24-06-2024

New Energy Blue and ARCO/Murray to build out the New Energy biomass refinery

New Energy Blue, the clean-energy developer whose technology converts agricultural waste into lowest-carbon biofuels and biochemicals, and ARCO/Murray, one of America's largest, most experienced, and fastest-growing construction firms, today announce a partnership to build out the New Energy Biomass Refinery designed platform across the American Midwest.

ARCO/Murray will construct the flagship New Energy Freedom biomass refinery in Mason City, Iowa, to sustainably process corn stalks into second-generation fuel ethanol and clean lignin at large commercial capacity. The partners have agreed to a $650 million construction contract. In 2023, New Energy Blue completed the design engineering, obtained local permits to proceed, and conducted field trials of new harvesting methods and machinery; in 2024, the project entered the final investment decision (FID) phase. The partners plan to break ground later this year and start up the refinery in 2026.  

The significant economic impact anticipated is comparable to that typically seen with first-generation ethanol facilities. In Iowa, the state responsible for approximately one-quarter of U.S. production, the industry contributes about $8 billion to household incomes annually and 100,000 indirect and induced jobs. The construction of the Freedom refinery in Mason City is projected to generate between 400 and 500 high-paying construction positions over a 20-month period. Refinery operators and feedstock suppliers from New Energy Farmers aggregation team will hold about 70 permanent jobs carrying an annual payroll of $7 million. The economic ripple effects will likely support another 5,000 jobs. Local corn growers stand to benefit by not only selling their excess corn stalks to the refinery but also participating in profit-sharing through the New Energy Farmers business unit.

Patrick Hidder, Executive Vice President of ARCO/Murray's Green Infrastructure team, says, "We are excited to partner with New Energy Blue on this groundbreaking biomass refining project, reflecting our shared commitment to sustainability and innovation in the renewable energy sector. We welcome the opportunity to help launch a nascent industry dedicated to decarbonizing this country's fuel and chemicals."

James Foster, Vice President of Construction for New Energy Blue, says the selection of ARCO/Murray as engineering, procurement, and construction (EPC) contractor "has paid off immediately. Their involvement is letting us accelerate the project schedule, manage costs, and provide the necessary bonding capacity needed to satisfy finance. ARCO/Murray's expertise in process piping, water treatment, anaerobic digestion, and power solutions has already added significant value."  

Following Freedom's successful completion, New Energy Blue and ARCO/Murray have agreed to extend their partnership to four more New Energy biomass refineries in the next five years, clustered near the first to take advantage of the area's superabundance of corn stover. Harvesting within a 30-mile radius of each operation makes it possible to build refineries with twice the output of Freedom.   

As the refineries proliferate, New Energy Blue CEO Thomas Corle says he intends to license the technical and business model in order to allow faster replacement of fossil oil and gas-refined fuels and chemicals with biomass-refined. "ARCO/Murray is right-sized to handle the construction–$6.8 billion in revenue in 2023, and a history of 5500 finished projects."

Lee Stellakis, Chief Operating Officer of ARCO/Murray, believes the investment made in this partnership presents a huge growth potential in green infrastructure construction, which his management sees as essential to a sustainable future. He's especially enthusiastic about the important role carbon-zero renewable fuels will play in transforming auto and airline travel by reducing atmospheric emissions.    

The new partners envision exponential growth: 15 biomass refineries operating by 2030, 150 by 2040, and 500 by 2050—generating an annual total of 21 billion gallons of 2G ethanol from leftover stalks and straws as well as perennial energy grasses like miscanthus. Predictions based on New Energy Blue's latest independent life-cycle analysis are heartening: 500 refineries can keep more than 130 million tons of CO2 out of the atmosphere every year, an essential reduction in the effects of climate extremes on human health.   

In 2019, New Energy Blue purchased exclusive rights to its Inbicon technology from Ørsted, Denmark's largest energy company. "Many of us worked on the team to prove and market the original conversion technology and, in 2010, to construct our predecessor biomass refinery in Kalundborg, Denmark. It's now owned and managed by Meliora Bio, and still processes Danish wheat straw into 2G ethanol and various coproducts," Corle says.   

New Energy Blue has made important process optimizations over the years. To assure dependable execution of its design, it counts on longstanding relationships with proven suppliers like two European specialists: Processbio for its automated front-end bale-handling system and Valmet for the thermal reactors that cook the biomass. The cooking facilitates the release of cellulosic sugars and the extraction of clean lignin, the woody structure of the corn stalk. The cellulosic sugars are fermented into 2G ethanol for auto fuel or downstream conversion into biochemicals. The extracted lignin is used in the production of polymers and binders, serving as sustainable alternatives in road construction and replacing traditional oil and gas components in the manufacturing of eco-friendly polyesters, polyurethanes, and resins.