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KiOR’s offtake agreement a major step forward

March 9th, 2011 No comments

Double-shot of news about KiOR on a wet Wednesday morning, so let’s jump right into it.

First, a correction to our story that ran in the Feb. 28 edition about a study MSU did that determined there’s ample timber in Mississippi to support the three facilities KiOR plans to build here. We reported that each of the facilities — in Columbus, Newton County and Franklin County — would use between 2,500 and 3,750 tons of wood daily to produce the re-crude that can be later refined into diesel or gasoline.

That isn’t exactly right. The Columbus facility, which is under construction now, will only use about 500 tons of wood per day. The other two, while they are larger than the Columbus facility, will use “significantly less” than the 2,500 and 3,750 per-day total, according to a KiOR spokesperson. Sorry if we caused any confusion. There’s a lot of excitement across a range of industries about KiOR’s plans for Mississippi.

That was intensified Tuesday, when KiOR announced it had reached a purchase agreement with Tuscaloosa, Ala.-based Hunt Refining Company, which will buy and refine the renewable gasoline and diesel blendstocks and fuel oil produced in Columbus.

This is perhaps the biggest development since KiOR’s announcement last summer, because the company couldn’t take advantage of the $75 million in state incentives until it had reached an offtake agreement with a refinery.

No details were available about the length of the agreement.

Has KiOR reached a purchase agreement for its product? (Update)

October 26th, 2010 2 comments

Bluefire Renewables Inc., the California-based biofuel company that is building a facility in Fulton, has reached three major milestones recently.

The company has reached a feedstock agreement that will ensure it has the biomass it needs to produce ethanol, it has found a buyer for the ethanol, and it has let the contract to actually construct its facility.

Another biofuel company that plans to build in Mississippi, KiOR, will not receive any of the $75 million in benefits the Legislature approved for it in late summer until KiOR has reached a purchase agreement with an oil company (or companies) to buy the renewable crude oil and refine it.

KiOR CEO Fred Cannon said in late August that he and his team were “in final negotiations” with a buyer. With that in mind, Magnolia Marketplace has been trying since Monday morning to find out if an agreement has been finalized; and if not, how close one is to becoming finalized. Calls and emails to a KiOR spokesperson have not yet been returned. Gov. Haley Barbour’s spokesman Dan Turner was not exactly sure one way or the other. We’re currently awaiting a response from the Mississippi Development Authority.

It would seem nothing can move on this project until KiOR has found somebody to buy and refine the re-crude it plans to produce from timber. The bulk of the state money approved for the project will go toward construction costs and the equipment that will stock it.

So has a purchase agreement been reached? It’s not a hard question. When we get an answer, we’ll let you know.

UPDATE: A KiOR spokesperson just emailed Magnolia Marketplace and said there had been no off-take agreement reached, and that discussions between the company and potential buyers remain ongoing.

No firm timetable exists for executing a deal, but it’s our guess that they’d like to get one done as soon as possible.