OMAHA (DTN) -- DowDuPont plans to sell its 30-million-gallon-per-year capacity cellulosic ethanol plant in Nevada, Iowa, nearly two years to the day after the company hosted a grand opening.
The company held a grand opening on Oct. 30, 2015, during which then-Gov. Terry Branstad and other dignitaries were in attendance.
The $225 million plant, which is still in the start-up process, was expected to demand about 375,000 tons of corn stover from about 500 local farmers within a 30-mile radius of the plant. The plant was to create about 85 full-time jobs and more than 150 seasonal jobs.
In a statement provided to DTN, the company said it will continue to be involved in the broader cellulosic ethanol industry, focusing its business on enzymes and yeasts.
"As part of DowDuPont's intent to create a leading specialty products company, we are making a strategic shift in how we participate in the cellulosic biofuels market," the company said.
"While we still believe in the future of cellulosic biofuels, we have concluded it is in our long-term interest to find a strategic buyer for our technology including the Nevada, Iowa, biorefinery," the company stated. "We will continue to participate in the overall biofuels market through specialty offerings including biofuel enzymes and engineered yeast solutions that improve yield and productivity for biofuel producers. We plan to work closely with local, state and federal partners to assure a smooth transition as we pursue the sale of the business. All affected employees will receive support services during this transition."
In a news release from 2015, the company said it intended to sell the fuel in California as part of the state's low-carbon fuel standard.
The company's decision to sell is part of an ongoing cost-reduction strategy undertaken following the DuPont and Dow merger.
According to a filing with the U.S. Securities Exchange Commission on Thursday, the company's board of directors approved a "synergy program" that is "anticipated to deliver run rate cost synergies" of about $3 billion within 24 months.
"The synergy program includes certain asset actions, including strategic decisions regarding the cellulosic biofuel business reflected in the preliminary fair value measurement of DuPont's assets as of the merger date," according to the SEC filing.
"Current estimated total pretax restructuring charges could be impacted by future adjustments to the preliminary fair value of DuPont's assets."
Todd Neeley can be reached at email@example.com
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