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On January 26, 2012, ZeaChem, Inc. announced that it had received a $235 million loan guarantee from the U.S. Department of Agriculture to finance construction of a biofuel refinery in Boardman, Oregon. The facility, which will be operational by the end of 2014, will produce up to 25 million gallons of cellulosic ethanol per year.
Cellulosic ethanol is produced from non-edible biomass sources, such as agricultural residues, trees, and grasses. It costs about half as much as corn ethanol to produce and reduces greenhouse emissions 85% over reformulated gasoline. Since cellulose is so abundant, it is estimated that 323 million tons of cellulose-containing raw materials are thrown away each year in the U.S. If converted to ethanol, those materials could be used to supply as much as 30% of the nation’s fuel needs.
The ready supply of forest trimmings and agricultural residue in Oregon could make the state a leader in the biofuel industry. Oregon already offers tax credits for suppliers of the feedstocks used to make the fuel. ZeaChem’s biomass mix will contain 30% agricultural residue of which 70% will come from a 28,000 acre poplar plantation in Boardman owned by GreenWood Resources of Portland.
Boardman is located about three hours east of Portland on Interstate 84. Since the town is located on the Columbia River, ZeaChem’s ethanol likely will be transported to Portland and Seattle by barge and distributed along the west coast. The facility is expected to create 65 local jobs and 118 construction jobs.
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