JBS Swift Biogas Plant Receives Financing
US - Environmental Power Corporation's subsidiary, Microgy Grand Island is to finance the beef processor JBS Swift's biogas plant in Nebraska.
30 July 2008
2 minute read
Environmental Power has completed the sale of $7 million of tax-exempt bonds issued by the City of Grand Island, Nebraska and will use the proceeds to finance the construction of the Grand Island Biogas Project at the JBS Swift Plant in Grand Island, Nebraska.
The biogas facility, which is being developed by the Company's subsidiary, Microgy, Inc., is already under construction and is expected to begin producing biogas by the end of the year.
The bonds will bear interest at a rate of seven per cent per year and mature on June 2023. The bond proceeds will be applied to the construction of the project.
With this deal the Environmental Power has fully secured financing for the project.
"This represents another important step in the growth of our business and demonstrates that financing is available on competitive terms for our projects," said Rich Kessel, President and Chief Executive Officer of Environmental Power.
"The project backed, tax exempt financing markets remain accessible for our projects despite the recent troubles in the credit markets. Ultimately, the value of the gas that we produce and the waste solutions that we provide our partners are what drive the success of our projects.
"I also want to thank JBS Swift and the City of Grand Island for all their help and support though this process," continued Kessel.
The Grand Island Biogas Facility will produce and sell biogas to the adjacent JBS Swift beef processing plant pursuant to a 15-year biogas purchase agreement.
The facility will use proven anaerobic digester technology to convert animal waste and other byproducts of the JBS Swift plant into a methane-rich biogas to be used as fuel in the plant's existing boilers.
At capacity, the facility is expected to generate 235,000 MMBtu per year -- the energy equivalent of 1.7 million gallons of oil -- and will offset approximately 25 per cent of JBS Swift's annual purchase of natural gas.
In addition to reducing the plant's dependence on fossil fuels, JBS Swift will be able to reduce the land application of organic waste materials from its operations.
B.C. Ziegler and Company doing business as Ziegler Capital Markets Group served as the Underwriter for the placement of the bonds.
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