JACKSONVILLE, Fla. -- Some retailers are content to sell E85. Buzz Hoover wants more.
Hoover, president of Jacksonville, Fla.-based Gate Petroleum, talks like an expecting father when asked about the $150 million ethanol plant Gate is building in Florida. It's like a big still, he told CSP Daily News. I began exploring the idea in April 2005. By December, we decided to go full speed ahead to find out how much it would cost to build.
Gate, which operates 100 stores and supplies another 250, plans to be up and running by 2008. The [image-nocss] plant will sit on 85 acres and produce 50 million gallons of ethanol each year.
It's the first ethanol plant that's been built as part of a vertical-integration strategy by a petroleum marketer, Hoover said. It's also the first ethanol plant to be powered by woodchips, and that requires us building a pretty big boiler and a storage facility for the woodchips.
About 800 tons of woodchips per day will keep the plant running. No fossil fuels will be consumed, said Hoover.
In addition to the woodchips, the plant will guzzle 650,000 gallons of water and consume 60,000 bushels of corn each day. A 75-car train arrives every five days from the Midwest with a corn delivery, he said, so we have a pretty elaborate rail yard there as well.
Half of the plant's production will be used for Gate's own retail system. We'll be selling E85 at all 40 of our Jacksonville Metro locations and some of the other North Florida stations, Hoover said. And we're going to have E10 at all of our North Florida locations.
So you believe in ethanol, Buzz?
Either that or we're crazy, he said. There can't be much volume potential right away, but we think it will ramp up. We've had a number of calls and letters from people asking if we're going to offer E85.
Florida is the third-largest oil-consuming state behind California and Texas, but, he said, it has the least secure supply because everything comes via water and the hurricanes mess that up. Even if there's a hurricane brewing out in the Gulf, it disrupts the barge traffic in the Atlantic.
Ethanol isn't the only product the plant will produce. We're the first to license a process that produces high-value co-products, Hoover said. We get high-value animal feed out of it. About 25%-30% of the revenue will come from co-products and that's about twice as much as a typical ethanol plant.
The plant is an investment in the future. I think it will take several years, but it's worthwhile, he said. It's a way to stretch our energy supply, it cleans the air, and it makes us less worried about what's going in the Middle East.
To read more about how retailers are working E85 into their offerings, watch for the October issue of CSP magazine.
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