KiOR planning to start Natchez construction in January

Published 12:04 am Tuesday, May 15, 2012

NATCHEZ — If all goes according to plans in Columbus, construction on a KiOR plant in Natchez should begin in January, Natchez Inc. Executive Director Chandler Russ said.

And 14 to 18 months after ground breaks at the former Belwood County Club site, the company will be ready to use 1,500 tons of dry wood chips a day to make 2,300 barrels of Recrude, or renewable crude oil.

The company will then refine the oil at the Natchez site to make gasoline, jet fuel or diesel. Those products will be sold to companies like Chevron and Fed-Ex, both of which have already committed to buying the KiOR product from the company’s Columbus plant once it’s made.

Email newsletter signup

Russ spoke Monday evening at a meeting at the Adams County Extension Center attended mostly by local businessmen with their pulse on the timber industry.

KiOR’s mid-south fiber supply manager, Roy West, also gave a presentation to approximately 100 local foresters and potential timber suppliers on how the company’s process works.

“Our black magic is in that catalyst,” West said during a power point presentation, referring to the technology.

West said when he was hired he was one of approximately 70 employees, and 30 of his coworkers had PhDs.

“We have more than 100 patent applications filed,” West said.

West said the company’s process can create its product from materials other than timber, but the Natchez facility will use timber only.

Russ said KiOR plans to begin production in July at its Columbus site, and how smoothly that facility operates will determine whether the Natchez plans kick off on time.

West said the pilot and demonstration KiOR facilities in California and the Houston area, respectively, are producing the product successfully.

The Columbus plant will be 500 times larger in scale than the demo plant, West said, so it’s possible unforeseen issues could occur when scaling to that level.

“We feel confident we have a scalable process,” West said.

The Natchez facility will be three times larger than the Columbus facility, West said.

Some vocal attendees left the meeting in want of more from a supplier’s standpoint.

Richard Whitney, the former International Paper land manager and owner of Whitney Forestry Management Services, asked about the specific requirements for the timber.

West said the company would take timber in all forms — chips, long wood and tops, but that the wood must meet Engineered Wood Association, or APA, standards, which is a “constantly changing scenario.”

“We need to know a whole lot more a lot sooner than 14 months (ahead),” Whitney said.

Russ said those interested in tracking KiOR should pay attention to the performance of the Columbus plant as it ramps up in a facility of its scale.

Regardless of possible changes in the timeline, Russ said, the eventual operation of the KiOR plant will be using a significant amount — more than half a million tons of dry wood chips — from local timber sources a year.

KiOR, a publicly traded company, announced in late March during the company’s fourth-quarter investors’ conference call that it would locate its second Mississippi production facility in Natchez, a move the company originally said will create 300 jobs. The company has since said it has not yet estimated number of jobs related to its Natchez development.

In addition to Natchez’s access to river transportation, the area’s proximity to wood production areas played a role in KiOR’s decision to locate in Natchez, KiOR CEO Fred Cannon said in the initial announcement.