Ethanol facility powered by renewable energy from dairy waste planned for Fair Oaks Dairy Farm in Indiana
June 20, 2006
FAIR OAKS, Ind. -- Bion Environmental Technologies and Fair Oaks Dairy Farms, the largest dairy east of the Mississippi River and an industry leader in efforts to find a solution to dairy environmental issues, today announced a joint venture that will enable environmentally sustainable expansion of animal agriculture in concert with ethanol production. Bion’s patented animal waste technology supports the synergistic integration of ethanol production with animal agriculture by enabling herd concentration. Herd concentration both provides the scale needed to achieve the economically viable generation of renewable energy in support of ethanol production, and establishes a stable local market for the entire volume of produced co-product distiller grains without the need for drying.
Bion’s technology platform provides sufficient renewable energy from the associated animal waste stream to produce ethanol absent any outside fuel source such as natural gas or coal, while it directly addresses the growing long-term risk to distiller grains revenues as those markets become increasingly saturated by the continued expansion of U.S. ethanol production. The result of Bion’s unique integration of ethanol with animal agriculture is economic and environmental sustainability for both.
Early results indicate that implementation of Bion’s patented and proprietary technology improves the net energy balance in the production of ethanol from corn from 1.4 to 1 up to 2.5 to 1. In essence, Bion’s technology platform utilizes the inherent energy value of the cellulosic component of the manure stream to improve both net energy value and margins in the production of ethanol.
The integrated Bion platform incorporating ethanol production at Fair Oaks will be a balanced, closed-loop system that the company’s research indicates will create sufficient renewable energy to support one million gallons of ethanol for every 1,000 dairy cows. “Based on Bion’s ratio forecast between herd concentration and ethanol production, it appears that both heat energy and ethanol co-product can be in balance in an environmentally sustainable manner,” according to John Ewen of Ardour Capital, an advisor to Bion.
The two-stage joint venture announced today provides for the construction of a research center in Stage One to determine the economic and environmental sustainability of utilizing sand bedding in conjunction with Bion’s technology platform. Based upon that evaluation, Stage Two will include a Bion treatment system for Fair Oaks’ dairy herd and potentially other local dairy herds, along with an ethanol plant of a size to be determined by the number of participating dairy animals. Stage I construction is expected to commence shortly; Stage II is projected to commence in 2007.
End products from the animal waste stream in Bion’s proprietary system include renewable energy. and high-value biological solids to be marketed as either organic fertilizer or as a high-protein animal feed ingredient for other species.
Bion’s implementation plan projects a number of dairies located within a geographic area, each with modular waste treatment facilities capable of handling the waste stream of 10,000 dairy cows or more. Renewable energy produced by the Bion technology platform will meet the natural gas requirements of an ethanol plant on a ratio of 1,000 dairy cows to one million gallons of ethanol production. This model will enable Bion to secure burner-tip (retail) values for the renewable energy produced, instead of wellhead (wholesale) values presently being achieved by anaerobic digesters and other renewable energy technologies focused on the animal waste market.
Expanded herd concentration directly resulting from the implementation of Bion's patented technology platform can lower capital costs while significantly improving operating margins of expanding or new ethanol facilities. Ethanol production sites will not require dryers, eliminating both the capital and the imbedded energy costs in the corn co-products. In addition, the ability to create a local herd in immediate proximity to the ethanol plant essentially eliminates the distiller grains marketing and revenue risk, reducing transportation costs and eliminating the requirement for natural gas in the site selection process. It will enable existing older plants and East Coast facilities to “create” markets for their ethanol co-product, and therefore to remain competitive with newer larger facilities in the Midwest.
Bion’s patented technology significantly reduces environmental impacts of large-scale animal farming while enabling herd concentration required for economies of scale in the generation of renewable energy. The patented “microaerobic” process for treating dairy waste biologically converts most of the pollutants so they no longer escape into the air and water, reducing the nutrient content of the treated waste stream in the effluent discharge by 70-80% and air emissions by up to 99%. The closed-loop ethanol production system simultaneously provides an end user for the undried distiller grains and for the dairy’s waste stream.
The new research center at Fair Oaks will also test the closed-loop ethanol-production system with waste from other farm animals, such as hogs and beef cattle.
For more information on Bion’s system performance data, peer review team and test protocols, see http://www.biontech.com/technology/.
About Fair Oaks Dairy Farms: Dr. Michael J. McCloskey, one of the principals of Fair Oaks Dairy Farms, has held leadership roles at all levels of the dairy industry. A veterinarian by training, he is also active in the ownership and management of other dairies in New Mexico, Michigan, and Indiana, and previously operated two dairies in Southern California. He founded in 1992 and continues to co-own and manage Quality Milk Sales, which is responsible for marketing over 4 billion pounds of milk a year on behalf of Select Milk Producers and Continental Dairy Products, whose operations stretch through New Mexico, Texas, Oklahoma, Kansas, Indiana, Michigan, and Ohio. He was instrumental in the formation of the Southwest Agency, which controls the marketing and transportation of virtually all milk in Texas and New Mexico on behalf of private dairy farmer cooperatives. Its success has been viewed as a model for achieving price stability without government intervention in other parts of the country.
Dr. McCloskey is acting chairman of the Southwest Cheese Company, set up to handle 10 million pounds of milk per day, and serves on the board of the National Milk Producers Federation, participating in the Federal Order Policy and Dairy Export Policy committees. In 2004 he started a large-scale agri-tourism and brand-building experience, the Fair Oaks Dairy Adventure and Fair Oaks Dairy Products Partnerships.
About Bion: Bion Environmental Technologies, Inc.’s patented and proprietary technology for large dairy farms (as well as swine and other animal facilities) mitigates the nutrient releases to water and gaseous emissions to air created by the waste streams of such operations while enabling profitable integration of renewable energy production (methane and ethanol). Bion’s stock trades under the symbol “BNET” on the Pink Sheets. This material includes forward-looking statements based on management's current reasonable business expectations. In this document, the word “intends” and similar expressions identify certain forward-looking statements. These statements are made in reliance on the Private Securities Litigation Reform Act, Section 27A of the Securities act of 1933, as amended. There are numerous risks and uncertainties that could result in actual results differing materially from expected outcomes.
For further information, please visit the Bion website at www.biontech.com, or contact:
Mark Smith
President and General Counsel
(719) 256-5329 office
(303) 517-5302 cell
mas@biontech.com, or mas1@ctelco.netDavid Mager
Vice President – Public Policy
(413) 247-0120 office
(413) 427-1768 cell
dmager@biontech.comJohn Ewen
Ardour Capital Partners, LLC
(212) 375-2950, ext. 222 office
jewen@ardourcapital.com