Ethanol project fuels optimism

Ethanol project fuels optimism

By Dan Cook

1111_EthanolProject
New management hopes to have the former Cascade Grain ethanol plant operational next year.

Seventy jobs may not seem like a lot. But to tiny Clatskanie (population: 1,710) in Columbia County, it’s 70 more people spending money locally who weren’t spending it before.

That’s how many the restarted ethanol plant in Clatskanie will employ once it’s up and running, perhaps as soon as January. Now operating as Cascade Kelly Holdings LLC, the former Cascade Grain project, located on 44 acres at Port Westward, had collapsed into bankruptcy seven months after its 2008 opening, taking with it millions in government subsidies and other investment dollars. The Longview, Wash.-based builder, JH Kelly, bought the assets out of bankruptcy in late 2009, brought on a new, experienced management team to run it, and made various modifications to make it more profitable than its predecessor.

Cascade Kelly has already hired workers to get the once mothballed facility ready to start producing ethanol again. “We felt a dramatic difference in the last couple of months” from their spending locally, Columbia County Commissioner Tony Hyde says.

Hyde thinks the experienced team now operating the plant is the key to the plant’s success.

“The experience level of the people in charge of Cascade Grain was zero,” he says.

Dan Luckett, the new general manager, has operated ethanol plants since 2006. He thinks the plant will surpass its original capacity of 108 million gallons a year by at least 12 million gallons. In addition, modifications to the plant and the production process will yield two new byproducts — corn oil and carbon dioxide — that Cascade Kelly can sell along with the ethanol.

To meet his goal of ramping up production by January, Luckett says the plant still needs “full buy-in from all stakeholders.” The process of negotiating new terms for operation of the facility has already pushed back the reopening about six months. At issue are a renegotiation of some terms of a sublease for the property with PGE; attempting to secure some $5 million in tax credits from the state granted to the original owner; and resolving water quality and road access issues with the Port of St. Helens, which supplies water and controls the roads to the area.

Luckett expects to start pumping out ethanol in the first quarter of  2012.