Feed&Grain.com |

VeraSun receives DIP financing for $196.6 million

The U.S. Bankruptcy Court has granted VeraSun Energy Corp. final approval for debtor-in-possession (DIP) financing totaling $196.6 million. The incremental financing will be available, subject to certain conditions, to fund operations at ethanol production facilities in Aurora, SD and Fort Dodge, Charles City and Hartley, IA, and to maintain the idled Welcome, MN facility. VeraSun continues efforts to secure longterm financing for its facility in Marion, SD. Its facility in Janesville, MN remains idle.

The Court approved the company’s request to reject certain corn contracts for delivery through December at the idled Welcome and Janesville facilities. The Company also intends to reject corn contracts for delivery through Jan. 31, 2009 at those facilities. In addition, because the company does not expect to operate the production facilities located in Central City, Ord, Dyersville, Albert City, Hankinson, and Woodbury through January 15, 2009, the company intends to reject contracts for delivery of corn scheduled at these facilities during this period. This action was taken to responds to a number of requests by producers to gain certainty on the status of their corn contracts and will allow them to move forward to remarket their corn.

VeraSun and 24 of its subsidiaries filed petitions for relief under chapter 11 of the U.S. Bankruptcy Code on Oct. 31, 2008.

Energy producers launch Growth Energy

A group of ethanol producers from around the country including POET, Green Plains Renewable Energy, Hawkeye Energy and ICM launched a new organization, Growth Energy, to combat claims that ethanol has driven food prices upward. The new organization released an ad campaign to set the record straight on food prices, at a time when corn prices have decreased by more than 50% and oil prices have been tumbling, while food prices continue to soar. The cost of food has increased 7.6% in the past year, the worst rate in nearly 20 years, and has continued to increase while the cost of corn and other commodities have fallen.

“The assertion by critics that ethanol production is the root cause of high food prices has been proven false,” said Dave Vander Griend, CEO of ICM. “Corn and commodities prices are significantly lower now so according to GMA’s argument, if biofuels were forcing food prices up previously, the lower cost of corn should have already brought food prices back down.”

Ceres announces new chief financial officer

Ceres, Inc. named Paul M. Kuc to be the energy crop company’s chief financial officer. Kuc will oversee Ceres’ capital management and financial systems, among other responsibilities. Ceres, which is developing new crops for next-generation biofuels and biopower, plans to commercialize its first seed products under the trade name Blade Energy Crops.

SunEthanol raises $25 million, changes name to Qteros

SunEthanol raised $25 million in Series B financing from a consortium including BP and Soros Fund Management LLC, and is changing its name to Qteros. The new name refers to its breakthrough Q Microbe technology for producing sustainable liquid fuel from nonfood plants and wastes. Massachusetts Gov. Deval Patrick announced Qteros’ new name in a speech in Boston.

The biofuels start-up that began with a professor’s discovery of an exceptionally efficient microbe for making cellulosic ethanol will now scale up from the pilot plant to commercial operations.