Although they have not provided regular updates to town of Montezuma officials as once promised, the developers of a proposed biodiesel plant in the town said last week that their project is still on solid ground.
“The news is there is no news,” said David Colegrove, president of the Auburn BioDiesel Corp. “We haven't had any news to release.”
Colegrove's statements followed a town meeting days earlier when residents expressed concern about the viability of the project, given the lack of communication coming from the owners.
“We could have been back to the press every time our projections changed, but our basic purpose is to avoid the 'Destiny Model' of hyping our project at every turn and delivering something completely different at the end of a PR campaign that has already turned everyone completely cynical,” Colegrove said in an e-mail.
He was referring to the high-profile DestinyUSA project at the Syracuse Carousel Mall, which has seen years of promotion.
Colegrove said his company's initial projections for cost, anticipated starting dates and completion timetable were just that - projections.
“Many industry experts have complimented our plan and out team,” Colegrove said. “We have a concept and plan and team that will be funded. This is a strange market for investment of any kind, with contracting and evaporating investment over the past year.”
The three-phase reconstruction project based on 570 acres of the former Clinton Corn/Archer Daniels Midland corn syrup processing facility in Montezuma would establish a 30-million bushel soybean crushing plant to produce 30 million gallons of biodiesel fuel per year in its $100 million first phase. The company's earlier estimates had pegged the cost of that phase at $70 million.
The entire project would take about 40 months to complete, but the total cost for the project is yet to be disclosed.
The old ADM facility would be converted to biodiesel to make oil and meal. With water supplies in place, ABDC's startup would require a minimum of 78 employees, increasing to 200 at full operation.
The mechanical soybean crushing operation would also create high-quality, high-protein soy meal to be used for livestock feeds.
Auburn BioDiesel would also develop processes for making biodiesel from other sources, including algae.
Colegrove said the company would have avoided publicity until being fully-funded, but “it was important to take our project to the Town of Montezuma and to (Cayuga County Industrial Development Authority) when we did.” That happened last year, and it then became a public story.
“We are in pursuit of 100 percent private financing of our project,” Colegrove continued in the e-mail. “We have every good reason to believe the private sources we are pursuing will deliver full funding of our project soon.”
He cited factors beyond the company's control as preventing announcement of a definite deadline for the project. Who the private backers of the project are and why anticipated funding was held up was not publicized because Auburn BioDiesel Corp. entered into a non-disclosure agreement with funders, he said.
Once full private funding is in place, Colegrove said, the company would pursue IDA and other public funding sources, “but only to expand a project already as guaranteed as private funding can make it, and only to enable us to deliver a number of ‘community benefits' - water to towns and on-site generation leading the list of community benefits we believe we can deliver.”
George Farenthold, vice president of ABDC, also reinforced the viability of the project.
“We are moving forward in every direction; we are just suffering from the credit crisis,” he said. “That does not mean that we have quit or stopped asking. We are working hard to make this bear fruit. Don't stick a fork in it because we aren't done, yet.”
He indicated that the company envisions a business tied to agri-products: dairy people who need soy meal, for example. Also, it could supply diesel for boats using the Erie Canal and Seneca River, fuel trains running on the nearby CSX main line and buses. The oil could also substitute for No. 2 petroleum-based fuel oil now used in boilers, creating bioheat.
“We're hoping to produce 30 million gallons per year within five years and up to 150 million gallons in 20 years,” Farenthold said.
Colegrove qualified that statement by saying, “We believe the physical capacity of that facility will produce that amount, but it's really not knowable what would happen in 20 years, and until we do Phase I.”
Board of directors members for ABDC include: Jon Verbeck, CPA and financial consultant; Cynthia Day, secretary to the board; Pamela Kirkwood, CCC trustee and management consultant; and Farenthold, Aurora village trustee,
“All I can tell you is that CCIDA has passed the initial project resolution for officers and staff at IDA to work with ABDC,” said Steven Lynch, Cayuga County Industrial Development Agency president and director of Cayuga County economic development. He noted that benefits available through the IDA require public hearings to secure such arrangements as tax exemptions and other forms of financial assistance.
“The initial project resolution accepts their application to the IDA,” he said. “If the project came to fruition and went through the process, it could be eligible for a number of benefits,” he said.
The IDA also acts as a liaison to Empire State Development Corp., the state's economic development agency.
Lynch said the IDA is ready to assist the company when it says it's positioned to move forward.
“As an IDA we don't set a schedule for how the project will move forward,” Lynch said. “It's a tight time in markets now, and this is a tremendous, complex undertaking.”
He noted that the time varies to get from the initial application to closing on IDA benefits.
Some projects are ready to go in a month, while project startups for new companies often take more time.
“There's no reason for us to take any next steps until they (ABDC) say they're ready,” Lynch said. “We're patiently waiting.”
Staff writer Kathleen Barran can be reached at 253-5311 ext. 238 or kathleen.barran@lee.net
Colegrove's statements followed a town meeting days earlier when residents expressed concern about the viability of the project, given the lack of communication coming from the owners.
“We could have been back to the press every time our projections changed, but our basic purpose is to avoid the 'Destiny Model' of hyping our project at every turn and delivering something completely different at the end of a PR campaign that has already turned everyone completely cynical,” Colegrove said in an e-mail.
He was referring to the high-profile DestinyUSA project at the Syracuse Carousel Mall, which has seen years of promotion.
Colegrove said his company's initial projections for cost, anticipated starting dates and completion timetable were just that - projections.
“Many industry experts have complimented our plan and out team,” Colegrove said. “We have a concept and plan and team that will be funded. This is a strange market for investment of any kind, with contracting and evaporating investment over the past year.”
The three-phase reconstruction project based on 570 acres of the former Clinton Corn/Archer Daniels Midland corn syrup processing facility in Montezuma would establish a 30-million bushel soybean crushing plant to produce 30 million gallons of biodiesel fuel per year in its $100 million first phase. The company's earlier estimates had pegged the cost of that phase at $70 million.
The entire project would take about 40 months to complete, but the total cost for the project is yet to be disclosed.
The old ADM facility would be converted to biodiesel to make oil and meal. With water supplies in place, ABDC's startup would require a minimum of 78 employees, increasing to 200 at full operation.
The mechanical soybean crushing operation would also create high-quality, high-protein soy meal to be used for livestock feeds.
Auburn BioDiesel would also develop processes for making biodiesel from other sources, including algae.
Colegrove said the company would have avoided publicity until being fully-funded, but “it was important to take our project to the Town of Montezuma and to (Cayuga County Industrial Development Authority) when we did.” That happened last year, and it then became a public story.
“We are in pursuit of 100 percent private financing of our project,” Colegrove continued in the e-mail. “We have every good reason to believe the private sources we are pursuing will deliver full funding of our project soon.”
He cited factors beyond the company's control as preventing announcement of a definite deadline for the project. Who the private backers of the project are and why anticipated funding was held up was not publicized because Auburn BioDiesel Corp. entered into a non-disclosure agreement with funders, he said.
Once full private funding is in place, Colegrove said, the company would pursue IDA and other public funding sources, “but only to expand a project already as guaranteed as private funding can make it, and only to enable us to deliver a number of ‘community benefits' - water to towns and on-site generation leading the list of community benefits we believe we can deliver.”
George Farenthold, vice president of ABDC, also reinforced the viability of the project.
“We are moving forward in every direction; we are just suffering from the credit crisis,” he said. “That does not mean that we have quit or stopped asking. We are working hard to make this bear fruit. Don't stick a fork in it because we aren't done, yet.”
He indicated that the company envisions a business tied to agri-products: dairy people who need soy meal, for example. Also, it could supply diesel for boats using the Erie Canal and Seneca River, fuel trains running on the nearby CSX main line and buses. The oil could also substitute for No. 2 petroleum-based fuel oil now used in boilers, creating bioheat.
“We're hoping to produce 30 million gallons per year within five years and up to 150 million gallons in 20 years,” Farenthold said.
Colegrove qualified that statement by saying, “We believe the physical capacity of that facility will produce that amount, but it's really not knowable what would happen in 20 years, and until we do Phase I.”
Board of directors members for ABDC include: Jon Verbeck, CPA and financial consultant; Cynthia Day, secretary to the board; Pamela Kirkwood, CCC trustee and management consultant; and Farenthold, Aurora village trustee,
“All I can tell you is that CCIDA has passed the initial project resolution for officers and staff at IDA to work with ABDC,” said Steven Lynch, Cayuga County Industrial Development Agency president and director of Cayuga County economic development. He noted that benefits available through the IDA require public hearings to secure such arrangements as tax exemptions and other forms of financial assistance.
“The initial project resolution accepts their application to the IDA,” he said. “If the project came to fruition and went through the process, it could be eligible for a number of benefits,” he said.
The IDA also acts as a liaison to Empire State Development Corp., the state's economic development agency.
Lynch said the IDA is ready to assist the company when it says it's positioned to move forward.
“As an IDA we don't set a schedule for how the project will move forward,” Lynch said. “It's a tight time in markets now, and this is a tremendous, complex undertaking.”
He noted that the time varies to get from the initial application to closing on IDA benefits.
Some projects are ready to go in a month, while project startups for new companies often take more time.
“There's no reason for us to take any next steps until they (ABDC) say they're ready,” Lynch said. “We're patiently waiting.”
Staff writer Kathleen Barran can be reached at 253-5311 ext. 238 or kathleen.barran@lee.net
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