Tuesday, June 15, 2010

In Production

American Process (private) is making progress with at least one project in its biorefinery portfolio, even if not the cellulosic ethanol demonstration plant proposed for location in Alpena, Michigan. We first wrote about American Process in our January 26, 2010 post, “BioChemistry Set.” The Company and its partner Valero Energy Corp. (VLO: NYSE). American is getting $17.9 million to produce biofuel and potassium acetate using pulping by products from the Decorative Panels International Mill located near Alpena.

Valero (through its subsidiary Diamond Alternative Energy) and American Process started production at another demonstration plant in Thomaston-Upson County in Georgia. That plant is also demonstrating American Process’ cellulosic ethanol technologies.

Trademarked AVAP, an acronym for American Value Added Pulping, the Company’s technology is deployed to co-produce pulp and ethanol from wood in biorefineries integrated with operations producing the woody mass feedstock as a co-product. AVAP utilizes alcohol sulfite cooking liquor to fractionate softwood chips into three lignocellulosic components that are subsequently used for ethanol production or channeled as supplemental energy back into the process.

According to American Process, the key to success for both projects is process integration with the feedstock source and successful recovery and utilization of all chemicals. The AVAP process is run concurrently with the pulping process at the Georgia plant and that lowers cost.

American Process still plans to have the Alpena demonstration plant in operation by the end of 2011. We expect the success in Georgia to provide a good roadmap.


Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.
$VLO

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