Agrebon Inc., a Colorado-based manufacturer of renewable fertilizers, announced that it has entered into an agreement with Progressive Nutrient Systems LLC (PNS) to build several small-scale nitrogen fertilizer plants in North Dakota.
The plants will be developed by PNS, a new company based in Fargo, N.D., and will be located adjacent to ethanol production facilities throughout North Dakota. The facilities will be managed by Agrebon and will use the company’s technology, which converts ethanol byproducts and other waste streams into low-carbon, nitrogen-based fertilizer.
Agrebon said the goal of the project is to reduce the carbon footprint of corn-based ethanol production while also providing a local supply of fertilizer to area farmers.
“Agrebon offers a disruptive technology to drastically improve how ethanol is produced and how farmers gain access to fertilizer,” said Justin Eisenach, Agrebon CEO. “It has global potential to change the way we live. That’s why we like to call it the ‘iPad of the industry.’”
The first two plants, which the companies describe as “modules,” will be located at ethanol production facilities near the North Dakota towns of Casselton and Hankinson. Eisenach told Green Markets that the plants will be capable of producing 20 st/d of ammonia or 35 st/d of urea, with the end product determined by the local market.
“One plant will do about 70,000 acres of corn, but we can design the fertilizer for that growing region,” he said. “What farmers need in eastern North Dakota is different than what they need in western North Dakota.”
Plans are for the first facilities to be up and running by the first quarter of 2014. The companies hope to construct more plants throughout North Dakota, and Eisenach said there are also plans pending for one location in Illinois.
“This type of distributed concept is new for the fertilizer industry, meaning it goes where there’s an underutilized methane source, whether it’s an ethanol plant or stranded natural gas or a covered lagoon from a food processing plant,” Eisenach said. “When you take stranded methane resources that are undervalued and underutilized, you can get attractive pricing that is not subject to the volatility of natural gas.”
North Dakota’s six-member Renewable Energy Council (REC) voted unanimously in November 2012 to approve a $431,000 grant to PNS for the $1 million engineering phase of the project, pending the completion of a feasibility study and the receipt of letters of support from ethanol producers and the Energy and Environmental Research Center in Grand Forks, N.D. Eisenach said those contingencies have been met and the funding has been awarded.
At the REC meeting in November, Dan Olson, CEO of PNS, was queried on how many nitrogen plants the company plans for North Dakota, what effect the plants would have on local fertilizer prices, and whether CHS Inc.’s plan to build a major nitrogen facility in the state (GM Sept. 13, 2012) would impact demand and prices for the fertilizer products produced by the smaller plants.
“The only concern is regarding the economic feasibility of the fertilizer production,” one REC member said. “Will the applicants’ production of bio]fertilizer be cost]competitive with fertilizer produced by larger manufacturers? Will local farmers be willing to pay a slightly higher price for fertilizer produced by PNS/Agrebon compared to fertilizer prepared by larger manufacturers?”
Olson told the REC that PSN and Agrebon expect to build up to 15 of the plants in North Dakota, with multiple modules at some ethanol production sites. While acknowledging that fertilizer prices might be slightly higher from the smaller plants, he said local farmers will have eq