BIOFUEL CLASSIFIEDS: Six U.S Fuel Ethanol Plants for Sale; Federal Tax Credit Included

Researched by Industrial Info Resources (Sugar Land, Texas)--Checking the biofuel classified section of the U.S. Bankruptcy Court, Prime Clerk LLC (New York, New York), the solicitation agent filed by Abengoa Bioenergy Holding LLC, a subsidiary of Abengoa S.A. (NASDAQ:ABGB) (Seville, Spain), will be waiting in April for firm bids to purchase the company's bankrupt fuel ethanol plants located in Kansas, New Mexico, Illinois, Indiana and Nebraska.

Industry speculation is that there are four to six parties expressing possible interest in buying Abengoa Bioenergy's plants. Of the six U.S. plants, only those in Madison, Illinois, and Mount Vernon, Indiana, remain in production. Chances remain favorable that buyers will be found and the plants will eventually be back in production.

On March 1, involuntary Chapter 7 bankruptcy cases filed in Nebraska and Kansas were terminated, and motion for a Chapter 11 bankruptcy filing will proceed. This will allow Abengoa Bioenergy to continue to operate under the direction of Prime Clerk.

The six plants have a combined production capacity of an estimated 375 million gallons per year of fuel ethanol production. The 25 million gallon-per-year plant in Hugoton, Kansas, which went into operation in mid-2014, is considered an advanced biofuel or second-generation production facility and produces biofuel from cellulosic biomass feedstock. The plant also incorporates cogeneration technology that generates 20 megawatts (MW) of electricity and provides internal process steam for production equipment.

The Abengoa plants are estimated to represent $850 to $900 million in assets, but selling the plants at cost will be a challenge. One could come in and buy the plants at bargain prices with a federal fuel tax credit included.

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