BioNitrogen Corp., a Florida company that has developed proprietary technology to convert biomass waste into urea fertilizer, announced on Aug. 15 that it has signed an agreement with United Suppliers Inc., giving the Eldora, Iowa-based wholesale fertilizer company the right of first refusal for biomass-based urea produced by any future BioNitrogen plants in North America. The agreement also provides for urea purchases by third-party customers of United Suppliers.
“The support and backing of such an important fertilizer supplier is a testament to the validity of our business model and mission,” said Carlos Contreras, president and CEO of BioNitrogen. “This relationship provides us access to 735 ag retailers in United Suppliers’ footprint in North America. Our intent is to build plants in the U.S. that allow the North American ag retailers and farmers to use domestic urea fertilizer made from U.S. biomass. Our partnership with United Suppliers creates a true win for our company, and for the North American ag retailer and the farmers that United Suppliers represents.”
Earlier this year, BioNitrogen entered into a letter of intent with United Suppliers (GM Feb. 6, p. 12) for the purchase of up to 300,000 st of urea annually, in granular or prill form, for an initial term of three years. BioNitrogen reported then that its small, modular urea plants can produce up to 124,200 st/y and can be located in high agricultural areas, where they can buy biomass (plant stalks, husks, household garbage, etc.) from farmers, and in turn supply them with urea.
A source with United Suppliers said more details of the agreement will be released soon.
BioNitrogen also reported on Aug. 10 that it has signed an agreement to purchase biomass – including tree trimmings, agricultural waste, and woodchips – from 40 acres of land in Florida’s Hardee County. The company said the Hardee County property is part of a larger parcel on which BioNitrogen plans to construct its first biomass-to-urea production facility. The land is currently owned by Larry Davis, a partner in Florida Fertilizer Company, and is being leased to BioNitrogen for a period of two years with an automatic two-year renewal provision.
As a result of the Florida deal, BioNitrogen said it has decided to postpone plans announced earlier to construct a fertilizer plant in West Texas, and instead focus its resources and capital in Hardee County. BioNitrogen said the decision was based on “a reassessment of both the availability of appropriate biomass and the potential market for urea” in Hardee County.
The company noted that Florida is one of the largest producers of tree trimmings as well as other sustainable biomass, and that the availability of this feedstock is year-round and not subject to declines due to changes in weather. BioNitrogen also said rapid and sustained development in Florida, along with the growth in the number of golf courses, has increased the amount of land producing biomass, and that companies disposing of biomass are paying large “tipping fees” to collection centers where the trimmings are disposed. BioNitrogen said it also intends to collect tipping fees for the disposal of biomass waste.
“The biomass, or plant feedstock, is a material cost in our plant business model,” said Contreras. “In the planned operation being set up in Hardee County we can source the biomass and generate revenues at the same time, on a year-round basis.”
BioNitrogen noted that it may review the feasibility of a plant in West Texas at some point in the future.