Southwest Iowa Renewable Energy, LLC and Bunge North America to build ethanol plant in Iowa
July 31, 2006 - Council Bluffs, Iowa and St. Louis, Missouri - Bunge North America, Inc., the North American operating arm of Bunge Limited (NYSE: BG) and Southwest Iowa Renewable Energy, LLC announced that they have agreed to build and operate a 110-million gallon per year ethanol production facility near Council Bluffs, Iowa.
Southwest Iowa Renewable Energy, LLC (SIRE) is an entity primarily owned by farmers in Southwest Iowa that was formed in 2005 for the purpose of developing and operating the proposed plant. On Saturday, SIRE formally closed a successful investment round to provide equity for the project. Under the agreement, SIRE’s farmer members would hold the majority of shares while Bunge would be the largest single shareholder. Bunge would market the by-products and provide other key services for the new facility. AGRI-Bunge, LLC, a joint venture between Bunge and AGRI Industries, an Iowa cooperative, would be responsible for grain origination to support plant operations.
SIRE recently purchased a 470-acre construction site from Pottawattamie County, which has ready access to transportation including two interstate highways and five rail carriers. The site is located adjacent to the MidAmerican Energy power plant and is near several petroleum distribution centers.
“Bunge operates the largest soybean processing facility in the country in Council Bluffs, creating a strong presence with local farmers and civic leaders,” said Tim Gallagher, senior vice president and general manager, Bunge Grain. “Through this venture with SIRE, we hope to add value to our existing operations and leverage our experience in origination, merchandising and logistics to benefit both the community and the venture.”
David Denne, chairman of SIRE agrees, “Our objective has been to establish a locally owned ethanol plant that can generate significant economic value for our region. We’re pleased to be able to align our business with an organization that has already demonstrated a longstanding commitment to our local ag economy, and that shares our sense of values, investment objectives, and support for our local community. The inclusion of Bunge as a strategic operating partner will allow our company to garner access to critical resources, and to operate with the economies of size and scale needed to optimize profitability for our members. To further leverage the economies of scale, we are preliminarily exploring the feasibility of increasing the facility’s capacity to up to 250 million gallons per year.”
SIRE has retained the services of ICM, Inc. of Colwich, Kansas to design and construct the proposed plant. ICM is recognized as a leader in the industry having designed more ethanol plants than any other firm. Site development is nearly complete with groundbreaking scheduled for fall 2006 and initial operations scheduled to begin in early 2008.
About Bunge North America
Bunge North America (www.bungenorthamerica.com), the North American operating arm of Bunge Limited (NYSE: BG), is a vertically integrated food and feed ingredient company, supplying raw and processed agricultural commodities and specialized food ingredients to a wide range of customers in the livestock, poultry, food processor, foodservice and bakery industries. With headquarters in St. Louis, Missouri, Bunge North America and its subsidiaries operate grain elevators, oilseed processing plants, edible oil refineries and packaging facilities, and corn dry mills in the U.S., Canada and Mexico.
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