Mascoma and Valero sign deal

Mascoma has signed an agreement with Valero Energy to develop and operate a 20 million gallon a year commercial-size cellulosic ethanol facility that will be built in Kinross, Michigan, US.

The plant will cost about $232 million (€175 million) and the companies plan to expand the facility to produce a further 40 million gallons a year as part of a second phase.

The build is expected to begin within the next three to six months and scheduled for completion by the end of 2013.

The technology used at the plant will include Mascoma’s consolidated bioprocessing, which involves converting hardwood pulpwood into ethanol. The wood has been intentionally grown and harvested for this process and is found ‘in abundance’ in the local area, the companies say.

Valero is to supply the project management that will build the development and will hold the majority share of the project, although the company will only receive royalties for a certain time period based on ethanol yield milestones.

Valero will also be given the opportunity to further develop the facility to produce a further 80 million gallons a year.