Okanagan Ethanol Plant

Release

WORLDS FIRST FOSSIL FUEL FREE AND ENERGY INDEPENDENT ETHANOL MANUFACTURING FACILITY TO BE BUILT IN KELOWNA


Wednesday’s announcement that Okanagan Biofuels Inc. intends to build BC’s first ethanol manufacturing facility in Kelowna, is an important step in the country’s efforts to address global climate change. The event takes place on the same date that the protocol for the Kyoto Accord – an international agreement aimed at reducing greenhouse gas emissions – becomes binding for 30 industrialized countries including Canada. This will be followed by the Okanagan Biofuels, Inc.’s official groundbreaking in March, 2005.


Okanagan Biofuels, Inc. is one of only seven projects from across Canada chosen to receive Federal Government funding – a $10 million grant – through the Federal Ethanol Expansion Program (EEP) announced in 2003. The EEP is intended to expand fuel ethanol production and use in Canada and reduce transportation-related greenhouse gas (GHG) emissions that contribute to climate change.

The Okanagan Biofuels facility will produce ethanol fuel from grains such as wheat, corn and barley. Up to 60 jobs, mostly trades positions are expected to be created at the local plant within a year, and 400 to 600 additional jobs will be created within a 150-mile radius of the facility related to farming, transportation and other aspects of ethanol production and delivery. The company is expected to develop important collaborative relationships with local universities, equipment manufacturers and technology providers.

The Okanagan Biofuels manufacturing facility will be constructed at the site of the former Hiram Walker distillery using state-of-the-art technologies. This unique facility will combine a traditional front-end ethanol facility with a patented backend anaerobic digestion system aimed at revolutionizing the ethanol industry around the world. In addition to producing 115 million litres of ethanol, the plant will produce 15MW of residual green power – enough to satisfy approximately 20% of Kelowna’s power requirements. It will also produce 130,000 tons of concentrated liquid and solid organic fertilizers – by-products of ethanol production.

The company was subject to stringent criteria during the EEP selection process. Twenty-seven proposals were submitted initially of these, 17 met the criteria for technical and financial viability. From the latter group, Okanagan Biofuels was among the final seven companies selected to receive grants in the first round of the program, with a total of $78 million awarded. It has since met final criteria of obtaining financial commitment for the remainder of funds required for plant construction, and completion of an environmental assessment.

Canadian demand for fuel ethanol currently surpasses supply. The federal government announced a target in August 2003 requiring that 1/3 of all gasoline sold in Canada will contain 10% ethanol by 2010. The resulting reduction in greenhouse gas emissions is equivalent to taking 400,000 cars off the road. Saskatchewan, Manitoba and Ontario have set mandates of blending all gasoline sold in those provinces with 5-10% ethanol by 2007, and in July, 2004, the BC government made ethanol excise-tax exempt.

The company’s initial target market is refiners and distributors in western Canada. Easy access to rail and highway transportation from the plant’s Central Okanagan location provide the opportunity to distribute to markets in Manitoba, Saskatchewan, California, Washington and Alaska in future.

The Ethanol Expansion Program underscores the positive impact that increased ethanol production will have on the environment, as well as the economic opportunities it will provide. The Canadian Renewable Fuels Association reports that, “Ethanol is one of the best tools we have to fight vehicular air pollution.” Almost one in three cars in the United States runs on ethanol-blended gasoline. In Brazil, every car is required to do so.

Okanagan Biofuels President, Alexander Kopp describes the facility as, “An economic and environmental template for the emerging Canadian ethanol industry.”

Adds Steve Burns, 2005 Chair of the Central Okanagan Economic Development Commission, “The new Okanagan Biofuels facility is an important addition to the Central Okanagan economy. The job creation, environmental leadership and technological innovation associated with this venture fit well with the long-term goals set out through the Okanagan Partnership for a sustainable, environmentally-responsible economy.”