The Heron Lake ethanol plant project has reached its funding goal, but shares are still available.

By RAHN LARSON

The $100 million Heron Lake Bioenergy plant is moving forward full-speed ahead.

Bob Ferguson, chairman of the Heron Lake Bioenergy board, said the plant has reached its funding goal. But there is still room for more.

"We have 1,034 investors," Ferguson said. "The thing that is really exciting is that as we look at the breakdown of investors, a large chunk of the investment base comes from the four surrounding counties.

"That tells me that the people of this area are excited about the project and are willing to step up and support it financially."

Because this is a publicly held company, there are limitations on how it can proceed financially. For instance, it cannot exceed the equity amount listed in the prospectus.

However, a major investor has allowed what Ferguson calls an "elastic backfill." In other words, he will reduce his investment as additional investors are added.

No cutoff date has been established for the last day to invest in the project, but Ferguson said a decision could be coming soon. The Bioenergy board meets Friday and it is possible it will address the issue at that time.

Here are a few rules regarding investments:

• The buyer must be from Minnesota for the initial investment.
• The current share price is $2 per share with a minimum investment of $20,000.
• Investors must provide a down payment of 10% and the remaining 90% is due by mid-March.

Ferguson noted that share sales remain strong, despite the fact that the plant has done no advertising or soliciting since Dec. 8.

"We get calls every day," Ferguson said. "People know we have a viable project and that the funds are there. Now it is just a matter of whether they want to invest in the project."

Choosing a lender
Speaking of financing, Ferguson said the board is getting set to select a primary lender.

The board is working from a list of four lenders that have expressed interest in handling this project. The board has already met with one of those and expects to meet with another lender on Friday.

The other two candidates will meet with the board later this month. The lender will be dealing with a project that requires about $50-plus million in borrowed funds.

"We need a decision sometime in January," Ferguson said. "If everything goes well, we would like to be moving dirt by April 15. That’s providing the permitting and other things go well for us."

Permit process
Ferguson is confident that Heron Lake Bioenergy has met the requirements for the Minnesota Pollution Control Agency’s permit.

The board will discuss this issue at Friday’s meeting.

A public meeting regarding the permit is set for Feb. 17 at the Heron Lake Community Center. The close of the public comment period is March 1.

"As of last Thursday, we received word that things have gone really well with it," Ferguson said. "We’ve done our due diligence to protect the environment. That’s what we do here.

"You have to remember that Minnesota is second only to California in its permit requirements. We are in the upper echelon in environmental protection as a state."

Friday’s meeting is sure to include discussions on a variety of other topics, including employment, procurement agreements and other matters. A full update on that meeting will appear in the Jan. 19 Citizen.

(This story was provided courtesy of the Cottonwood County Citizen and Citizen Online www.windomnews.com.)