November 4, 2005
by Julie Buntjer - Daily Globe

HLBE breaks new ground; Construction ready to begin on Heron Lake ethanol plant

HERON LAKE — It was a day of celebration in Heron Lake Friday, as board members of Heron Lake BioEnergy and numerous dignitaries broke ground on Minnesota’s first ever coal-fired ethanol plant.

The 50-million-gallon facility is slated for completion by April 2007.

In an afternoon ceremony at the Heron Lake Community Center, HLBE president Robert Ferguson talked of the length of time to reach this day — from the initial concept for the plant in December 2001, more than 100 equity meetings, completing the plant’s design in January 2004 and enduring the lengthy permitting process that followed.

“Today, we’re pretty darned excited,” Ferguson said as construction was set to begin on the $104 million project, which is located in a Minnesota JOBZ zone. Most of the facility’s 1,000-plus investors hail from the state.

“It’s a State of Minnesota project, a southwest Minnesota project, a Jackson County project and a Heron Lake project,” he added.

Heron Lake Mayor John Hay said HLBE, when completed, will be the largest business project in the town’s history.

“This is a much anticipated day,” said Hay, who commended HLBE board members for their perseverance and tenacity in bringing their idea of turning corn into ethanol a reality.

Reaching the day of groundbreaking was not an easy task for the board which, according to HLBE capital consultant Jack Porter, “went to war and back for this project.”

Porter, who has worked with numerous ethanol plant projects, said, “When you start one of these equity drives, you never know if you’re going to get here.”

He commended the board for sticking with the project, especially after seeing the impact on fuel prices wrought on by recent hurricanes.

“Look at what Katrina did for oil prices,” Porter said. “The future of (the ethanol) industry will be more powerful than we anticipated.”

Fagen Inc., of Granite Falls, designed the HLBE project and will construct the facility. Its president, Ron Fagen, said the HLBE board went through more in getting this plant off the ground than any other he’s worked with.

“This board had a vision, and they wanted to do something different,” he said of plans to fuel the plant with coal. “Coal-fired plants are pretty expensive, but the payback will come pretty darned quick.”

Fagen said his company is involved with two coal-fired ethanol plants now under construction in Iowa. Both of those facilities will be online before HLBE, which he said will give them a chance to work out some of the kinks in the process.

Rep. Greg Davids, a Preston native and chair of the House agriculture committee, was touted by Ferguson as one of the biggest champions of ethanol in Minnesota. Davids spoke of work done at the state level to ensure the ethanol industry’s success, from the 1997 legislation calling for a 10 percent ethanol blend in all gasoline sold in the state to this year’s passage of E-20 legislation.

“Timing’s everything, and this is perfect timing,” he said of HLBE’s groundbreaking.

Davids commended Reps. Doug Magnus, R-Slayton, and Rod Hamilton, R-Mountain Lake, for working tirelessly to get the HLBE project and E-20 legislation passed this session.

“Southwest Minnesota has become the renewable energy capitol in the U.S. … and the world,” Magnus said. Hamilton echoed those comments moments later.

Minnesota Agriculture Commissioner Gene Hugoson brought a message of congratulations from Gov. Tim Pawlenty and said the state will continue to work hard for ethanol.

“Gov. Pawlenty has it as a high priority to establish a national energy policy that isn’t so dependent on foreign oil,” Hugoson said.

As he commented on the abundant harvest and numerous corn piles throughout the state, Hugoson said, “(Corn) can just as well be turned into something that we need — energy.”

The HLBE plant is expected to use 19 million bushels of corn annually once the plant is in production, Ferguson said.

Gerald Tumbleson, a Sherburn farmer now serving as president of the National Corn Growers Association, and Hills farmer Gene Sandager, president of the Minnesota Corn Growers Association, also spoke during the hour-long ceremony.