A Texas company announced plans Wednesday to build a $90 million wood-pellet plant in Monticello that it said will add 52 jobs to the community's labor force.
Zilkha Biomass Energy LLC of Houston said the plant will manufacture an advanced kind of wood pellet used in biomass-fired power generating stations.
"This Monticello plant will expand and strengthen our ability to deliver this new next generation pellet to the energy industry," said Larry Weick, the company's senior vice president for business development, at an event announcing the project.
Zilkha said the advanced pellet -- which can be stored outside and transported like coal -- can also be used as a biomass fuel source for converted fossil fuel stations as well as integrated into the fuel stream of coal-fired plants to help energy companies meet air emission regulations.
Wood pellets are needed to supply growing demand for renewable fuel for energy industry, which has doubled in recent years particularly in Europe, said Weick. Wednesday's announcement was attended by Gov. Mike Beebe and Nita McDaniel, executive director of the Monticello Economic Development Commission.
"Many parts 0f the world are blessed with a lot of solar and a lot of wind and Arkansas is blessed with trees," Weick said in a video of the announcement posted by the online news site, Monticellolive.com. "This is a great way for Arkansas to participate in what we believe is a worldwide growing market for renewable energy."
Beebe pointed out that wood pellets are gaining popularity as companies and consumers look for sustainable fuel sources that are cleaner and cheaper to burn.
"South Arkansas has the renewable forests that this kind of enterprise requires to succeed," Beebe said in a statement.
Material used to make the pellets includes mill scraps and low-grade wood. The company said in a release that since forests cover more than 18.8 million acres in Arkansas, the state is "an ideal location for biomass production."
Jack Holmes, Zilkha's chief executive officer, said the new plant will manufacture the company's "Zilkha Black Pellet," described as having better resistance to water than traditional wood pellets.
Zilkha Biomass has a pellet plant in Crockett, Texas, that it used for pellet production but is now shifting into more of a research and development facility, said company spokesman Jonathan Ohueri. He said the company has a second plant now under construction in Selma, Ala., that it hopes to open by the end of the year that will be capable of producing 303,000 tons annually.
When complete, the Monticello plant will be capable of annually producing 413,000 tons, Ohueri said.
After the announcement, McDaniel said the Zilkha project has been in the works for two years and fits well with the region's efforts to maintain a sustainable and renewable forest products industry. She said wages for workers at the new plant are expected to average around $14 per hour.
"Every time you win 50 or more jobs that hit above the median, it strengthens 0ur economic base," McDaniel said, noting the median household annual income in Drew County is $26,815.
Lisa Cogbill, with the Arkansas Economic Development Commission, said the project qualifies for several state incentive programs, including a $1 million Community Development Block Grant that the city will use for infrastructure work at the site including roads and parking; the Advantage Arkansas program which provides an income tax credit based on the payroll generated by new jobs and the Tax Back program which provides sales tax refunds on building materials, taxable machinery and equipment associated with the project.
Business on 07/31/2014