Plymouth Energy steams into production

Thursday, February 5, 2009
The Plymouth Energy Ethanol plant pours out steam over the Iowa landscape. The plant is currently producing about 120,000 gallons a day, enough to break even for now. Developers are optimistic about the future.

A cloud of steam has been steadily rolling out of the ethanol plant north of Merrill.

But steam isn't the only thing the Plymouth Energy Ethanol Plant is producing.

"We started grinding corn to make ethanol on Dec. 8," said Plymouth Energy President Dave Hoffman. "Right now we're producing 120,000 gallons a day."

The $100 million plant, he said, is still in the startup phase, preparing for the performance run, where any glitches or design flaws will be caught and eliminated.

"After that the contractors will leave and the plant will be all ours to run, probably around mid-February," Hoffman said. "We're ready for that."

Contractors have fixed a few snags.

"There are always some problems in start up, nothing catastrophic," Hoffman said.

Starting up in cold weather can also be challenging he said.

For the ethanol industry, the economic climate has also been challenging.

With corn prices skyrocketing earlier this year combined with swinging oil prices and the credit crunch, many of the nation's ethanol plants are sitting idle, and some companies are filing for bankruptcy.

During the period of volatile corn prices, the Plymouth Energy board decided to be conservative -- and that paid off for them, Hoffman said.

"We don't have any overpriced corn in our bins," he said. "Last summer corn prices were very high so we stayed out of the market until we started up."

Today, the plant's ethanol output is basically covering what it costs to make the fuel.

But company stockholders would like to see Plymouth Energy do more than break even.

The goal for Plymouth Energy, Hoffman said, is to increase output from 120,000 gallons per day to 150,000 per day.

"Nameplate (the plant's operational standard) is 144,000 gallons per day, but we expect to exceed that," he said.

Looking ahead, Hoffman projects confidence.

"Economic conditions are still tough today, but we're optimistic about the future," he said.

Company officials are predicting that corn prices will be more favorable to the ethanol industry in the coming year.

"Right now we see more opportunity for corn to decrease in value than increase," Hoffman said. "Some ethanol plants have cut down their output, livestock production is down and corn exports are down."

Still, he said, Plymouth Energy's board aims to be conservative.

Part of that is driven by partial owners Fleming Holdings USA, of Cork, Ireland.

"They've been good business partners. They've brought a lot of discipline to us as for our business practices," Hoffman said.

Fleming Holdings USA, he said, is a very conservative group which likes all the i's dotted and the t's crossed.

"In the U.S. we're more cavalier, cowboy. We do things with a handshake," Hoffman added. "They are very demanding with requests for daily production. We know all our costs per day and our budgets. If something is out of line, we make those changes."

Three people from the Irish group serve on Plymouth Energy's eight-member board. Hoffman said they fly in for monthly board meetings.

Ethanol isn't the only product created in the Plymouth Energy plant.

Byproducts of ethanol production are corn syrup as well as wet and dry distillers grains, which are used for livestock feed.

"A lot of cattle feeders in the area are getting some of their feed from us," Hoffman said.

Eventually, some of the corn byproduct will be fed into the nearby Plymouth Oil plant which, when complete, will produce food-grade corn oil.

"The plant is still under the development phase," Hoffman said. "It will employ 25 people."

The Plymouth Energy plant will employ 36 people in total.

Currently the plant is processing 50,000 bushels of corn a day, much bought from local elevators and farmers.

It takes 50 hours from kernel of corn to finished ethanol.

Ethanol and byproducts like distillers grains are two of three things produced in making ethanol. The third thing is carbon dioxide.

"Our goal as a company and with sister companies is to utilize all three products," Hoffman said.

The plan for the carbon dioxide is to collect it and use it to help produce another crop: algae.

"We'd send the carbon dioxide to a place that has warm water, it could be the city of Le Mars' waste water plant, and use it to help grow algae," Hoffman explained. "You can get fuel out of algae, and it can also be used for a value-added product like fish food pellets for fish and shrimp."

The carbon dioxide projects are still in the talking stage, Hoffman said, but he's anticipating good results.

As far as ethanol and the government, Hoffman is hoping the Environmental Protection Agency will allow 15-20 percent blends of ethanol in fuel for all vehicles.

"And I'd like to see every vehicle produced be equipped to be a flex fuel vehicle," he said, explaining that would make it able to run on ethanol blends. "It only costs $100 per vehicle and it allows consumers to have the choice."

Respond to this story

Posting a comment requires free registration: