The new owner of a shuttered ethanol plant in Soperton plans to eventually add hundreds of jobs there to produce ethanol and other chemicals, a company official said this week.
That would boost Treutlen County employment even more than the plant’s former owner, Range Fuels, had promised in exchange for state and federal handouts.
Laurel Harmon, vice president for government relations of LanzaTech Inc., spoke to The Telegraph this week about her company’s plans for the plant owned by its Georgia subsidiary, LanzaTech Freedom Pines LLC.
The Soperton refinery was built by Colorado-based Range Fuels with the help of about $90 million in federal and state grants and loan guarantees. But Range’s catalytic technology failed to produce commercial amounts of cellulosic ethanol, made from Georgia wood chips.
After shutting down its limited operations early last year, Range attempted to transfer the plant and its $40 million federal loan guarantee to LanzaTech Freedom Pines. Instead of allowing that deal, the U.S. Department of Agriculture triggered foreclosure on Range Fuels late last year. LanzaTech Freedom Pines subsequently bought the plant on the courthouse steps Jan. 2 for just $5.1 million.
At other international locations, New Zealand-based parent company LanzaTech Inc. is involved in making ethanol and other chemicals from industrial and landfill waste gases. This will be its first U.S. project, Harmon said.
State and local officials say they plan to meet with LanzaTech leaders in about 10 days to discuss possible job creation commitments. The equipment, which made the plant attractive at auction, was purchased mostly through a $6.25 million Georgia grant that required Range to create more than 60 jobs by 2015.
“We’re looking at tens of jobs in the near term, and hundreds of jobs as we scale to commercial (production),” Harmon said. “I hate to be specific about dates and numbers at this time. The intent is certainly to fulfill and exceed the job commitments made formerly.
“The goal is to take this site and achieve what wasn’t achieved before.”
LanzaTech Freedom Pines has retained the handful of employees that were still working for Range Fuels and just rehired a former employee, Harmon said.
“Our commitment is to hire locally wherever possible, and people with experience at the plant are an added bonus for us,” she said.
Plans for the plant
Harmon said LanzaTech is still evaluating the condition of the plant and its equipment, particularly the gasifier that burns the wood chips. Until that process is completed, probably in three to six months, the company won’t know how much it will need to invest at the plant or how long that will take, she said.
“We’re happy to share those plans as they get more fully developed,” Harmon said.
Even if the gasifier doesn’t end up working for LanzaTech, the company will move to develop the Soperton plant, company spokesman John Williams said in an e-mail. He said the proximity of waste forest materials, existing infrastructure, local work force and the commitment shown by the state and the local community make the value of the plant purchase “greater than the sum of its parts.”
A few weeks ago LanzaTech Inc. raised a $55.8 million private equity investment, some of which will be used to proceed with the Soperton project, Harmon said. Among the major investors are the Malaysian national oil company and Vinod Khosla, a Silicon Valley venture capitalist who was the primary backer of Range Fuels. LanzaTech CEO Jennifer Holmgren told Bloomberg news a few weeks ago that the company is considering an initial public offering later this year.
In Soperton, LanzaTech plans to turn wood chips to gas just as Range did. But after that step, the two companies use very different technology.
Range’s process was based on catalytic conversion, while LanzaTech uses a patented microbe to convert carbon monoxide gas into fuels and chemicals. LanzaTech will need to reconstruct and add to the plant to accommodate its different process, Harmon said.
“As we plan multiple stages of buildout, we anticipate a number of different products,” Harmon said.
The possibilities include ethanol as well as chemicals such as butanediol, butanol, propanol and acetone. These have a variety of applications such as synthetic rubber and solvents, she said. LanzaTech also is trying to develop a “greener” jet fuel and could work on that project in Soperton, Harmon said.
She said the Soperton facility is an important investment for LanzaTech, most significantly because it is the first location where LanzaTech will have sole control over the process and the product. In New Zealand, China and India, LanzaTech is involved in various projects using its microbe technology. But in all those cases the company has a partner or licensing contracts that focus on a particular product.
“This gives us the opportunity to be in control and to use as a basis for building out our portfolio of future processes,” Harmon said.
Initially LanzaTech will build a demonstration-scale plant with the intent to increase to commercial production of 35 million to 50 million gallons a year, Harmon said.
LanzaTech engineers have been evaluating the plant, but company leaders also plan to visit in a few weeks. State and Treutlen County officials expect to meet with them.
Before the USDA decided not to transfer Range Fuels’ loan guarantee to LanzaTech, the state and the Treutlen County Development Authority had agreed to transfer the $6.25 million state grant -- and the attached job creation requirements -- to LanzaTech. John Lee, executive director of the Treutlen County Development Authority, said those negotiations now have to start again from scratch.
Before the foreclosure, the development authority actually owned the plant property and leased it to Range Fuels for $1 a year, which exempted Range from paying property taxes on it. Lee said LanzaTech may be interested in creating the same arrangement by deeding the land back to the authority.
“We’ll be receptive to that or whatever they want to do,” Lee said.Brian Williamson, assistant commissioner for community development in the Georgia Department of Community Affairs, said the department is discussing with its attorneys the status of that lease to clarify whether it was extinguished. If not, LanzaTech might still be on the hook for the same number of jobs Range promised, he said.
Lee said he hopes to learn soon how many workers LanzaTech expects to employ and the time frame for construction. Williamson, who noted that the state was very surprised at the plant’s sale price, said he also wants to know how much LanzaTech intends to invest in Georgia.
“We want to do as much as we can with the investment that Georgians have made already,” he said. “The good news is the state’s investment is still in place, and there’s now private money coming into it.”
To contact writer S. Heather Duncan, call 744-4225.