$45M biomass refinery seeks home

MILLINOCKET – Several areas in Maine are being considered for a $45 million refinery, the state’s first and the world’s largest, that would turn forest products into clean-burning oil that would fuel electrical plants, according to a developer.

As envisioned by the Fractionation Development Center, a Rumford-based nonprofit firm promoting Maine biomass technologies, the full-scale pyrolysis plant would be the first of several eventually built in the state that each would create at least 60 jobs for processing 800 to 900 tons of wood a day into bio-oil, center Executive Director Scott Christiansen said Monday.

The bio-oil would fuel the creation of electricity about as cleanly as does natural gas in specially designed plants located near the refineries, he said.

FDC has been reviewing possible host areas for several months. It is considering Baileyville in Washington County, Down East Maine, Madison, the Katahdin region, Old Town, Presque Isle and Skowhegan among others, Christiansen said. Company workers will be in Baileyville on Jan. 16 and Millinocket on Jan. 17 to conduct informational meetings.

“Approval is a big deal,” Christiansen said Monday. “The citizens have to want it. You don’t want to mess with anybody who doesn’t want you.”

Such a facility would have a huge impact on the economy of the host site’s region, if not the state, Christiansen said. In the biorefinery industry, which has several similar plants operating in Canada, “there is nothing out there that even begins to compare to it in terms of [production].”

Christiansen said funding the first plant would be critical to making the plan a reality.

“What can’t be ignored is that the first one carries a lot of risk. When you do the first one, there has to be a significant return on investment. It’s got to be a high number, a 35 to 40 percent ROI,” he said.

“We haven’t found the slam-dunk spot that guarantees the first investment. There are a lot of investors who want to be a fast second. There aren’t that many to plunk down $35 [million] to $40 million on the first,” Christiansen added. “The questions that are left are: How tough is permitting going to be? How can we reduce costs everywhere to attract a first investor? Everybody within a community would have to help.”

If all goes well, site selection will occur by June, with local and state permitting afterward, construction beginning by year’s end, and operations starting within two years, he said.

Pyrolysis is defined as the reduction of matter into char, tars, oil and hydrocarbon gas in the absence of oxygen. Its end products are carbon black, oil that can be sent back to a refiner, and some hydrocarbon gases that can be used to make steam or electricity.

Bio-oil is the material from which carbon, in the form of charcoal, and a combustible gas are recovered through “biomass refining,” which is similar to the refining of petroleum crudes which produces a broad spectrum of liquid fuels and value-added petrochemicals.

Charcoal briquettes and some types of tires are made from pyrolysis processes.

Ensyn Corp. and Dynamotive Energy Systems Corp. are two Canadian firms that are among the world leaders in biomass technologies, Christiansen said. Ensyn’s current bio-oil production capacity is 5 million gallons annually, according to the company’s Web site, ensyn.com.

FDC released a report in February 2006 predicting that biofuel eventually could account for 50 percent of the fuel used in Maine annually if the state followed a blueprint the firm has developed, generating thousands of jobs and hefty profits for pioneering companies.

As part of an 18-month study funded by the U.S. Department of Energy and the Maine Technology Institute, the center calls for construction of 50 bioconversion plants in the state during the next 15 to 20 years, paid for largely by private energy companies.

“We don’t see more than a dozen coming into Maine, but we’re not worried about anything more than number one right now,” Christiansen said.

FDC has an as-yet unnamed technology partner that will handle plant operations. The center is also in discussions with investors, he said.

The siting is crucial. FDC officials have visited Millinocket twice. They were drawn to the Katahdin region, Christiansen said, for its rich woodlands and many experienced forestry workers.

“It’s got good infrastructure, access to an awful lot of forest area, and it is at a unique junction of land ownership so that we could deal with more than one owner of large tracts of land,” he said.

Town Manager Eugene Conlogue welcomed FDC’s interest in the Katahdin area, where about 50 percent of residents live at or below the poverty line and which has an unemployment rate about twice the state average.

“It’s a great thing for Millinocket, especially when you consider the level of forest resources we have in this general area that could supply this refinery,” Conlogue said. “It speaks loudly as well to the need to keep the forests in Maine working forests and not to block them away from future use.

“I am just looking forward to the presentation, and, hopefully, this project will come on line,” he added.

Conlogue invited the Town Council to attend FDC’s meeting, which will be held at the former Aroostook Avenue School from 10 a.m. to noon.

“All we can engage in at this point is preliminary conversations, but we are doing that fairly aggressively,” Christiansen said.