NEW YORK, July 10 (Reuters) - Private equity firm Riverstone Holdings on Monday said it plans to link up with Blackstone Energy Inc. to build a 15 million-gallon-per-year ethanol plant in Ontario.
The investors will convert an existing starch production facility in Collingwood, Ontario, to ethanol production expected to come online in mid-2007 pending provincial and federal approval.
The Carlyle/Riverstone Renewable Energy Infrastructure Fund will buy a 77 percent interest in the plant, known as Collingwood Ethanol GP.
Buyout firm Carlyle Group and Riverstone have teamed up to invest in the renewable energy space, having just raised a $685 million renewable energy fund. The fund will invest in wind, solar, geothermal, biomass, ethanol and biodiesel.
Soaring energy prices have prompted state and federal governments to explore alternative fuel sources such as ethanol -- a renewable, corn-based fuel additive. That in turn has created hot investing opportunities and pushed up stock prices tied to the sector.
"The ethanol production from the Collingwood facility will help meet national and provincial renewable fuel targets, and the corn supply and labor will be drawn from the local community," said Curtis Chandler, executive director of Blackstone Energy. Blackstone Energy is a Canadian energy group that has developed and operated commodity brokerages, natural gas marketing companies and natural gas storage facilities. It is not affiliated with New York private equity firm Blackstone Group.
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