The opening of a new wheat ethanol plant at a farmer-owned grain terminal in northwestern Saskatchewan included confirmation of $2.5 million in provincial funds to support it.
Agriculture Minister Bob Bjornerud on Wednesday confirmed the province’s repayable contribution for North West Bio-Energy at Unity, about 90 km southwest of North Battleford. The money will flow through the Saskatchewan Biofuels Investment Opportunity (SaskBIO) program.
North West Bio-Energy, which will use wheat as its ethanol feedstock, also uses biomass to create the energy needed for ethanol production — a move the company said will improve its carbon footprint and reduce its operating costs compared to facilities burning fuels such as natural gas.
The province first pledged the SaskBIO money for the new plant in October 2007, since which time the plant’s owner, North West Terminal of Unity, has had to pass six steps, including the commissioning of the facility and the confirmation of a specific level of local community and farmer investment.
The company held the ethanol plant’s official opening Wednesday at Unity.
Funds available under SaskBIO are allocated based on a sliding scale from two to 10 cents per litre of production, based on the facility’s percentage of investment by the community and farmers, ranging from five to 50 per cent.
The four-year, $80 million program offers up to $10 million in repayable funds per project for the construction or expansion of transportation biofuels production facilities in Saskatchewan. Eligible applicants include corporations, co-ops, individuals and partnerships.
NWT began construction of the $54 million, 25 million-litre-per-year plant in September 2007 after securing $13.65 million from local investors, the company said in a separate release Wednesday.
The project’s remaining funding, apart from the SaskBIO money, came from senior debt facilities of $24.5 million from a group of lenders including BMO, Farm Credit Canada and Innovation Credit Union; a repayable $5 million contribution from the federal ecoABC biofuel incentive program; and working capital from NWT.