Federated Co-operatives is set to lock in an ethanol supply for its member co-ops’ gas stations with a deal for a major Saskatchewan wheat ethanol producer.
FCL announced Wednesday it will buy the Terra Grain Fuels ethanol plant in the RM of Pense near Belle Plaine, about 25 km east of Moose Jaw, for an undisclosed sum.
TGF, owned by local investors and producers, has capacity to produce about 150 million litres of ethanol per year, requiring over 400,000 tonnes of grains and “starch-rich” crops from over 400 growers and producing up to 160,000 tonnes of dried distillers grains (DDG).
Cal Fichter, FCL’s vice-president for energy, said the deal, expected to close by the end of the month, “prepares us to meet the incoming national Clean Fuel Standard” while allowing local co-ops to provide transport fuels to members to meet existing renewable fuels standards.
The Co-operative Retailing System, which provides central wholesale services to FCL’s 200-odd member co-ops, currently includes 780 gas bar and card lock locations across Western Canada.
FCL on Wednesday also pledged to invest in “making the (TGF) plant more efficient and pursuing carbon capture and storage technologies.”
FCL said it will continue to operate TGF with its current staff of 45 employees, and the TGF business will also continue “working directly with all of its existing clients and partners.”
“This is a big win for TGF, FCL, the province of Saskatchewan and all of our stakeholders,” TGF president Calvin Eyben said in the same release. “To our valued customers, suppliers and other business partners, it will be business as usual for TGF and we don’t anticipate any interruptions during this transition period.”
Built starting in 2006 at a cost of about $130 million, TGF has been producing ethanol since 2008, contracting mainly for high-starch, low-protein such as CPS reds and whites, soft white wheats and winter wheats. The company currently bills itself as the largest wheat ethanol plant in North America. — Glacier FarmMedia Network