Monday, Jan. 19

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Group proposing ethanol plant
asks for county support    
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[JAN. 19, 2004]  Representatives of a group interested in building an ethanol plant came before the Logan County Board last Thursday to provide an update and make a request.

It's been two to three years since the feasibility study began and it is nearing final decisions, Rick Kaesebier said. Plant construction could begin in 2004 and operation by 2006.

The proposed plant will operate by using Illinois coal and Illinois corn to produce 40 million gallons of ethanol per year.

New technology developed at Southern Illinois University allows the fine remnants of high-sulfur Illinois coal to be used in such a way that it is environmentally friendly. The use of coal will provide a lower production cost than that of natural gas.

Setting up a plant at the site of an already established coal mine, Turris Coal at Elkhart, will cut transportation costs. Corn is also readily available locally. So the plant will cut costs by reducing transportation costs of raw materials of coal and corn and using previously wasted coal remnants.

The ethanol produced at the proposed plant will be transported 8 miles by truck to Mount Pulaski, where it will continue its transportation by train. Most of it will travel the tracks to the East Coast. The East Coast is the biggest buyer of distilled grains.

To do this, the road to Mount Pulaski will need to be upgraded to an 80,000-pound limit. The 40 million gallons of ethanol per year, about 100 semitrailers per day, will travel the road from Elkhart to Mount Pulaski.

Leaders from the communities of Mount Pulaski and Elkhart are working to lend their support to the project. At Mount Pulaski they are committed to their portion of the cost to upgrade the Township Hall Road.

The county is being asked to supply an estimated $3.5 million to $6 million to upgrade the road.

Dale Voyles said that $1 million is already committed to the regular upkeep of the road, so this will lessen the amount needed to upgrade it.

The county has a financial commitment that they have in process with a Fifth Street Road project. But, they will also consider the possibility of alternative financing, such as federal transportation funds that they may be able to acquire.

Terry Werth and Chairman Dale Voyles said that they would move this up in priority.

Kaesebier said, "If there is something the county is able to do that we can have on paper, it would really be welcome."

 

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Mayor Dayle Eldredge has worked with Phil Mahler from the Regional Planning and Zoning office to look for ways to offer tax incentives to bring in the project. An attempt to get the property approved as an enterprise zone failed state approval. An appeal was filed with no known results.

Mayor Eldredge said that Elkhart is prepared to offer TIF benefits that she says will offset those of the enterprise zone that can't be approved.

In addition to contributing to the reduction in dependence on foreign oil, the plant will bring local economic strength. It will supply construction jobs during the construction phase, and later it will supply $50,000-per-year permanent jobs. It will supply employment income and tax revenue for the communities, county and state.

Some of the estimated benefits:

During the construction phase:

  • 750-1,250 construction jobs for three years
  • $1.8 million from the Coal Industrial Park in state and local taxes
  • $1 million project cost
  • $142.2 million total "demand in a local economy"
  • $45 million in new household income

For the life of the plant:

  • 20-45 high-paying production jobs
  • 500-700 spinoff jobs created by the plant's presence
  • $3.3 million per year in added cash flow associated with the Coal Industrial Park
  • $19.6 million in annual household income
  • $1.2 million in state and local taxes
  • $56 million in operating expenses in a 10-year period

Project cooperators include Turris Coal Company, Land of Lincoln Agricultural Coalition, Babcock and Wilcox, Illinois Coal Mines, and Southern Illinois University.

The feasibility study has been prepared by Y. Paul Chugh and Amit Patwardhan of the Department of Mining and Mineral Resources Engineering at SIU, Carbondale.

Elkhart remains the preferred location for the plant, though the group behind the project has considered other locations outside of Logan County. Locating the processing plant near the mine reduces transportation costs. The decision of whether to build the new coal-based ethanol processing plant at Elkhart will be made in the next two to three weeks.

[Jan Youngquist]

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