Revised, Nov. 15 -- Agrifood giant Archer Daniels Midland has stopped studying and started moving on plans for a biodiesel production plant next door to its canola crushing plant at Lloydminster, Alta.
ADM on Monday confirmed it will build a 265 million-litre capacity plant at the Alberta/Saskatchewan border city, having studied the idea since April 2009.
The project will operate as a joint venture, called Northern Biodiesel Limited Partnership, with Vancouver-based Canadian Bioenergy Corp., which started talks in 2009 with ADM toward a jointly-operated plant and took part in the feasibility study.
The plant is expected to increase ADM's own North American biodiesel production capacity by 50 per cent, and to help Canada fulfill its mandate for renewable diesel fuel, ADM said. A mandatory minimum took effect in July requiring two per cent biodiesel in all diesel sold in Canada.
Construction is expected to start next spring for completion in the fourth calendar quarter of 2013, ADM said Monday.
The Lloydminster site "will help optimize ADM's agricultural origination, transportation and processing assets in Canada," the company said. The company already runs a biodiesel plant next to its canola crushing facility at Velva in North Dakota.
"The same agricultural processing operations we use to transform canola into oil for food and meal for animal feed also provide ADM with the ability and scale to efficiently produce cleaner-burning, renewable biodiesel," Mike Livergood, ADM's vice-president for global oleo chemicals, said Monday.
"This new biodiesel facility will help support canola crush margins and capacity utilization at this facility."
Illinois-based ADM in August 2010 announced plans to add a second unloading bay and double its grading capacity at the Lloydminster crush plant, noting area farmers in a survey had said they "were concerned about the amount of time they spent waiting to unload."
The company in March this year also announced plans to add five more storage bins at the site, doubling its storage capacity to 100,000 tonnes, and to add a second receiving system with additional conveyors and other equipment.
The second receiving system was expected to double the plant's crop intake rate and cut farmers' wait times in half, the company said at the time.
"Biodiesel represents a smart investment for ADM and for Canada," said J.P. Montalvo, commercial manager at ADM's Lloydminster facility, said Monday.
"A robust Canadian biodiesel industry diversifies the fuel supply, provides environmental benefits and fosters increased local demand for canola, which creates value for rural communities."
Much of the Lloydminster crush plant's oil output is already destined for export to Europe for use as biodiesel feedstock, and to Asia for food applications.
Apart from its deliveries from area growers, the Lloydminster plant sources canola from ADM elevators at Carberry, Man., about 50 km east of Brandon, and at Watson, Sask., about 40 km east of Humboldt.
CLARIFICATION, Nov. 15, 2011: A previous version of this article stated that Canadian Bioenergy Corp. went unmentioned in ADM's Nov. 14 release. Canadian Bioenergy affirmed its participation in the Lloydminster project Nov. 14 in a separate statement which, until now, was not mentioned in our article. The editor regrets any confusion.