In mid-September, East Fork Biodiesel, LLC began construction on its biodiesel refinery near Algona in northern Iowa. The facility will process soybean oil and animal fats into 60 million gallons of biodiesel and 6 million gallons of glycerin annually. It will be the first 60 million-gallon plant in Iowa.

"East Fork Biodiesel has certainly raised the bar for biodiesel production in Iowa," says Monte Shaw, executive director of the Iowa Renewable Fuels Association. "This locally owned project will be the largest biodiesel producer in Iowa and one of the largest in the entire U.S. The positive economic impact of this state-of-the-art facility will be felt throughout the Algona region."

East Fork Biodiesel President Ken Clark says, "Our goal is to provide an excellent investment opportunity for Iowans, manufacture high quality renewable energy to reduce demand for foreign oil and create good paying jobs. We believe East Fork Biodiesel will accomplish all of these things."


East Fork is still accepting investors

East Fork held an equity drive earlier this year, holding information meetings and selling stock to farmers and other Iowa investors who wanted to buy shares in the plant. In late September, the East Fork board of directors announced they still needed to raise another $2 to $3 million and would hold a public equity drive and informational meeting on October 2 at Algona.

"Things are going very well and we are continuing to build the plant," Clark told the crowd at that meeting. "We have had an increase in costs to build the plant. Because of that, we are going to keep our equity drive open to invite people to invest more money in the project. We need another $2 to $3 million.

"Previously, we had not officially closed our equity drive last summer," he says. "We just weren't accepting anymore money until we knew where we were at. Now we know how much more we need. All the benefits of building this plant are still here. It will produce 60 million gallons of biodiesel per year. It will provide 36 good jobs. The only difference is that the cost is $77.6 million to build the plant. The return on investment is still projected to be excellent—around 20%."

The minimum investment is $10,000. "You have to be a legal resident of Iowa," says Clark. "This is an Iowa project for the benefit of Iowans." If you are a current investor, can you increase your number of shares? "Yes, you can buy more shares," he explains. "You've already been accepted as a shareholder so all you'd need to do is increase your number of shares."


REG reorganizes as a biodiesel firm

The refinery is being built by the Renewable Energy Group, Inc. (REG), a company formed through the combination of West Central Cooperative's biodiesel business and REG LLC—an entity that is in the biodiesel plant construction business.

With this reorganization, REG is now the leading marketer of B100 and is the only full service biodiesel firm offering plant management, risk management, raw material procurement, plant construction, and biodiesel marketing.

"Renewable Energy Group is proud to partner with the members of East Fork Biodiesel to construct Iowa's largest commercial scale, state-of-the-art biodiesel plant," says Jeff Stroburg. He is CEO of Renewable Energy Group, Inc. "We look forward to working with East Fork to market high quality biodiesel as well as managing the operations of this 60 million gallon per year facility."


REG has minority interest in East Fork

REG is taking a minority interest in the plant and providing construction services. Construction is underway for the $70 million plant and production is expected to begin in approximately 12 months. The plant will use soybean oil as its primary feedstock. Construction plans also call for the development of a pre-treatment area for other types of feedstock, including animal fats or other oils.

Overall, the project is expected to net about 100 jobs during the construction phase and more than 25 new jobs as the plant opens. Forecasted annual biodiesel sales for East Fork Biodiesel are $144.6 million.

As East Fork Biodiesel joins the REG network of plants, East Fork President Ken Clark says, "This groundbreaking signifies the beginning of a great partnership with Renewable Energy Group. In about a year, we will be producing a renewable fuel which will help reduce this nation's dependence on foreign oil, burns clean, and offers exciting opportunities for Iowa investors and the development of our local, state and national economies."

Nile Ramsbottom, president of REG, shares this enthusiasm, "REG is proud to partner with East Fork Biodiesel to build Iowa's largest biodiesel plant. The construction of a commercial-scale, state-of-the-art, and highly efficient plant will help move this state and this nation toward their goals of energy independence."

This announcement comes on the heels of a successful initial private equity financing drive for REG and the announcement of key strategic partnerships in August 2006. This previous investment, and recent partnerships, is planned to create 496 jobs by 2010 in its network of plants nationwide and to market approximately 640 million gallons of high quality biodiesel. To learn more about Renewable Energy Group, Inc., visit www.regfuel.com.