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Company Plans First Texas Fuel Ethanol Plant

Company Plans First Texas Fuel Ethanol Plant
HOUSTON - In a state legendary for its oil industry, a company is planning to begin construction early next year of the first plant in Texas to make non-petrochemical, pollution-reducing ethanol.

Panhandle Energies of Dumas LP plans to begin building a 36-million-gallon ethanol plant in the Texas Panhandle, north of Amarillo, and far from the state's refining centers on the coast of the Gulf of Mexico.

The location offers easy access by rail to Midwest grain, from which ethanol, an alcohol, is made. Nearby feedlots offer a secondary market for byproducts from the ethanol production process, said Robert Worley, executive director of the Dumas Economic Development Corp. and a member of the board of Panhandle Energies.

"There is such a beauty to ethanol," Worley said. "It's a renewable resource and it's right for rural areas."

US demand for ethanol continues to grow as, one by one, states ban the gasoline pollution-control additive called methyl tertiary butyl ether or MTBE, which is a hydrocarbon made by refiners.

Ethanol, like MTBE, reduces tailpipe emissions by raising oxygen levels in an automobile's carburetor and burning more gasoline.

Ethanol is shipped by train. What the Panhandle produces probably would be shipped to fuel terminals in western US states like California, the largest so far to adopt ethanol, Worley said.

Eco-Energy Inc., a US marketer of ethanol, said it has signed an agreement to sell the Panhandle's ethanol output.

The $40 million Dumas plant is expected to be complete by early 2006, Worley said.

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