Conestoga Energy Subsidiary Palmer Energy Puts Stalking Horse Bid on Texas Fuel Ethanol Plant

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Researched by Industrial Info Resources (Sugar Land, Texas)--Privately held Conestoga Energy Partners LLC (Liberal, Kansas) has formed Palmer Energy, which has put a $9.21 million stalking horse bid on the bankrupt and shuttered fuel ethanol plant, which was initially built for Levelland Hockley County Coop.

ICM Incorporated (Colwich, Kansas) built a 40 million-gallon-per-year plant that cost about $65 million to construct in 2007, and a "Storage Wars"-style bidding process had the low bidder at $9.2 million. Back-up bidder Western Plains Energy LLC (Oakley, Kansas) bid $8.9 million for the plant if Palmer is unable to seal the deal.

Conestoga is looking to add to its fuel ethanol portfolio, which includes an existing plant in Liberal, Kansas, that produces 110 million gallons per year of the renewable fuel. Bids have been submitted to the U.S. Bankruptcy Court Northern District in Dallas, Texas, and approval of the sale is expected by Thursday of this week.

The plant owes $32 million to GE Energy Financial Services on debt that was passed to GE when the company bought the Merrill Lynch division back on 2007. A spokesperson for GE said, "We have no intention of rejecting the winning bid."

The plant is one of six ethanol plants operating in Texas.

Industrial Info's databases provide a comprehensive outline of all current development activities in the emerging alternative fuels market. Our North American Biodiesel Database covers 150 operational plants and 86 plants in development. Our North American Ethanol Database covers 215 operational plants and 103 plants in various development phases. Our North American Wood Fuel Pellet Database includes 70 operational plants producing more than 25,000 tons annually and 36 projects in progress.

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