Cherryvale Council passes resolution worth $ 900 million
■ Hopes high to net Canada-based bio-fuel manufacturer
The Cherryvale City Council met for their regular session meeting Monday evening. After the formalities were complete, the council members heard from Bill Webster, Vice President of Bartlett Savage regarding the proposed new facility that could be built adjacent to the soybean crushing facility south of Cherryvale.
Azure 2023 Sustainable Fuel Corporation is a privately-held corporation that focuses on sustainable aviation fuel- or SAF- focused renewable fuels production facilities. SAF will be required to meet both domestic and international mandates set in place related to reducing the amount of Carbon Dioxide emissions generated by the aviation sector, providing a cleaner environment, while promoting sustainability practices.
Webster opened up the presentation, outlining what the facility could bring into the area. The first of its kind in Kansas, it will be able to produce 135 million gallons per year of renewable fuels. If Azure choses the site, approximately 1,500 construction jobs will be made available and, once finished, the facility would employ more than 150 full-time employees.
'We're excited about the possibility and about the interest that Azure 2023 has,' stated Webster. He gave control over the podium to Stu Roberts, Vice President of Finance, CFO and Director of Azure 2023. Based out of Calgary, Alberta, Canada, the company was launched in the Spring of 2021 and was at that time solely focused on manufacturing SAF.
'The demand for the product is getting expeditiously higher,' he stated. By 2030, the United States government has set a target of manufacturing 300 billion gallons produced per year. By 2050, the global estimate is 350 billion gallons produced per year. Currently, there are 100 million gallons of SAF produced yearly. Azure's facility would double that number just in Phase 1 of the project.
Roberts indicated that he had been asked numerous times about why the company would venture looking at Kansas to become the U.S. headquarters of the company. 'If anything it was dumb luck, to be frank.' he joked. 'We've got a really good relationship with the guys at Bartlett and they're pretty convincing on pushing for the opportunity that was Kansas and what they were doing and [so] with them as the lead, they've shown us what this could be here. For the past... Eight to ten months, we've been looking at the opportunity that is right beside their facility.
'Considerable work has been done on engineering. They're currently out on site doing core holes for geo-tech and land stabilization work. We've got our environmental permitting regulatory process ongoing. We've successfully submitted and received our stormwater permit... Quite a lot of work is being done and it will just ramp up as we go into 2024.'
Roberts continued, 'Overall, the goal here is to produce a fuel that is as environmentally-friendly as possible and that's the value in that fuel and that's the market for that fuel.' The fuel produced at the facility will be blendin or drop-in ready, Roberts shared, 'Nothing more than pouring two jugs into a bucket. You don't have to change infrastructure at airports. You don't have to change the engines of planes. It makes sense.' There have been test flights with aircraft flying on SAF only and they have been successful. Virgin Atlantic announced recently that they would be booking a London to New York flight path using planes that run on 100% SAF.
With that in mind, Azure 2023 is looking toward the future, working hard to determine whether or not Montgomery County is a right fit for them. 'The goal is to continue due diligence on the site. Continue the engineering; work toward regulatory approval and, hopefully, we're targeting the end of the year coming up with a decision whether or not we go ahead and start.' Roberts indicated that there were a few locations that the corporation is eyeing in Canada, but the Montgomery County land is the only location they are looking at in the States. The location of the proposed new facility would be advantageous for both companies involved. Azure could build a state-of-the-art facility from scratch instead of retrofitting and refurbishing an existing facility; rail lines are already in place for transportation and Bartlett would have a receptacle for their byproduct practically on site. 'There's a lot of synergies between the two operations we hope to capitalize on,' Roberts stated Monday evening.
The proposed facility would require about 500,000 tons of soybean oil per year to create SAF and can utilize a number of different products to reach their end goal, including distillers corn oil and canola oil, as well as soybean oil provided by Bartlett. The company will not be strictly limited to aviation fuel products, but will also be equipped to produce regular bio-diesel fuel as well.
After Roberts was finished, Council members heard from City Administrator Jonathan Booe, who explained the ins and outs of the resolution, stating that, just that morning, the County issued taxable revenue bonds to finance the project, much like they did for Bartlett. The amount issued for the project was $900,000,000. 'A sizable amount,' Booe added. As with the Bartlett agreement, the County is the issuer of the bonds, but will not be held accountable for paying the monies back. 'The reason we have to approve and sign off on this,' Booe added, 'Is due to the proximity of the facility in relation to the City of Cherryvale.' All council members were in favor of adopting the resolution.
Moving on, the Council moved through the rest of the meeting quickly, approving the City holiday calendar for 2024, an ordinance setting Municipal Court costs and the consent agenda.
Minnick reminded those in attendance that City Hall will be closed Monday December 25 and Tuesday December 26 for the Christmas holiday. City hall will also be closed to the public all day Friday, December 29 for year-end close out and Monday, January 1 for New Years Day.