Suncor Energy Revives $113 Million Expansion Plan for Ontario Bioethanol Facility

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Canadian energy company Suncor Energy Incorporated (NYSE:SU) (Calgary, Alberta) has announced plans to resume the $113.3 million expansion of the St. Clair bioethanol production facility at Sarnia in Ontario. The company put the expansion plan on hold in January.

Suncor commenced operation of the St. Clair facility in June 2006. The firm will augment the production capacity of the corn-based bioethanol facility from 200 million liters per year to 400 million liters per year. The expansion project is also expected to increase the input of corn feed to 40 million bushels. The plant presently requires 20 million bushels of corn, which is sourced from local farmers.

After starch is extracted from the corn to manufacture ethanol, the remainder is used to produce dried distillers grains, which is used as a high-protein feed additive for cattle. The St. Clair facility is one of the largest bioethanol production units in the country. Suncor blends bioethanol with the Sunoco and Philipps-66 brands of gasoline. The expansion of this facility is expected to create 250 jobs in the Sarnia and Lambton areas during construction, and 15 jobs when operational.

Bioethanol is becoming a popular clean-fuel alternative to gasoline. It is widely used in the U.S. and Brazil as an automobile fuel. Bioethanol fuel is a renewable source of energy, and can be easily produced from common agricultural crops such as sugarcane, corn, sweet potatoes, wheat, barley, and sunflowers.

A study conducted by Pembina Institute for Appropriate Development (Calgary) has revealed that blending 10% of bioethanol to gasoline will reduce carbon-dioxide emissions by 300,000 tons per year. The proposed expansion of the facility will reduce greenhouse gas emissions by 600,000 tons per year.

Suncor is pioneering the renewable-energy drive in Canada. The company also operates four windfarms in the country and plans to expand wind power capacity. The windfarms include the 76-megawatt (MW) Ripley project in Ontario, the 30-MW windfarms in Magrath and Chin Chute in Alberta, and the 11-MW SunBridge wind power plant at Saskatchewan. These projects, with a combined capacity of 147 MW, help reduce carbon-dioxide emissions by 284,000 tons per year.

In August, Suncor Energy completed a merger with Petro Canada (Calgary) to become one of Canada's largest energy companies. The combined entity, which now operates under the name of Suncor Energy Incorporated, owns the largest oil sand deposits. Suncor Energy is North America's fifth-largest energy company in terms of market value.

Suncor's decision to resume the expansion program coincides with the federal government-backed eco-energy program, which has sanctioned incentives of $103.8 million to Suncor. Industry experts state that the funding is part of the contribution agreement signed in December last year. The eco-energy program has allocated $1.41 billion toward development and sustenance of biofuel production facilities.

In August, Husky Energy Incorporated (OTC:HUSKF) (Calgary) received $68.74 million for its bioethanol facility at Minnedosa, Manitoba. NorAmera Bio Energy (Moose Jaw, Saskatchewan), was allotted $12.95 million during a seven-year period for the development of a bioethanol plant in Weyburn, Saskatchewan. Canada has 16 operating bioethanol facilities, producing 1,731 million liters per year of bioethanol.

View Plant Profile - 1062579
View Project Report - 53002649

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy related markets. For more than 26 years, Industrial Info has provided plant and project opportunity databases, market forecasts, high resolution maps, and daily industry news.