Hugoton, Kan., August 19, 2011 — The Department of Energy's Loan Programs Office offered a conditional commitment for a $133.9 million federal loan guarantee to Abengoa for the construction of a commercial-scale biorefinery facility to produce renewable liquid fuel from plant fiber, or cellulosic biomass.
Upon successful satisfaction of the conditions precedent and approval of the loan guarantee, the company expects DOE to issue a guarantee of the loan from the Federal Financing Bank up to the amount ultimately approved by DOE.
With the offer of a conditional commitment now received, Abengoa Bioenergy has announced that they intend to start construction on the site, which is located near Hugoton, in Stephens County, Kansas, in the near future.
The DOE has been a supporter of Abengoa Bioenergy's efforts to develop new ethanol production technologies since 2003. The Department's Office of Energy Efficiency and Renewable Energy's Biomass Program originally supported the construction of the Abengoa pilot plant in York, Nebraska, with a $34 million cost matching award, then entered into a cooperative agreement with Abengoa Bioenergy in 2007 to provide up to $100 million towards the construction of the commercial facility in Hugoton, as one of six second generation biofuels facilities chosen for support in the DOE's biofuels initiative.
The plant is also designed to produce about 23 million gallons of cellulosic ethanol each year, as well as enough energy to meet the electric power needs of the plant.