Velocys picks US site for commercial-scale biorefinery

Renewable fuels firm Velocys Plc (LON:VLS) confirmed today the site in the US where its first commercial-scale biorefinery will be located.

The company said it has signed site option agreement with Adams County in Mississippi for the plant to be situated in Natchez, after being offered a package of economic development incentives.

Velocys has said the plant is being designed to produce 19 million gallons (72 million litres) per year of renewable diesel fuel from woody biomass residues. Before picking Natchez, the company analysed 12 sites in the southeastern US, which it says may host future biorefineries.

"With its strategic location and close proximity to a major waterway, Natchez was a natural fit for this proposed capital investment of several hundred million dollars," said Billy Klauser of the Mississippi Development Authority.

As announced in June, Velocys was invited by the US Department of Agriculture (USDA) to submit a Phase II application for a loan guarantee of up to USD 200 million (EUR 170m). The agreement with Adams County completes one of the work packages required for the loan guarantee application. "Velocys and its partners are continuing to make significant progress towards completing other work packages needed to deliver a successful USDA loan guarantee application, which we are targeting in 2018," said chief executive David Pummell.

(USD 1 = EUR 0.848)

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