Powers given another month in quest for trash-to-ethanol plant financing

2012-07-19T21:30:00Z 2012-07-20T17:40:05Z Powers given another month in quest for trash-to-ethanol plant financingBy Marc Chase marc.chase@nwi.com, (219) 662-5330 nwitimes.com

Powers Energy of America remained in breach of contract with Lake County's solid waste board but was given another month to try to prove it can finance its long proposed trash-to-ethanol plant.

The extension until the Aug. 16 meeting of the Lake County Solid Waste Management District Board is the latest in a long line of reprieves given to Powers Energy, which inked a contract with the board in 2008 to build a trash-to-ethanol facility but has yet to deliver.

In April, the district gave Powers Energy 90 days — a deadline that expired Thursday — to secure all financing or risk losing the contract. At that time, Powers Energy officials agreed to those terms after having already missed a previous 60-day deadline with the same stipulations.

However, with none of the money in hand Thursday night, Powers officials claimed they had received a letter from national firm Marathon Petroleum Co. at 10:06 a.m. that day.

Powers Energy owner Earl Powers told board members he was not prepared to provide copies or divulge the contents of the letter. But he did claim the letter indicated that Marathon was considering providing equity financing for the plant's construction in the range of $45 million to $90 million.

Powers admitted his company was still negotiating terms of Marathon's participation and claimed they are committed to his project.

In a 16-8 vote and not knowing the specific contents of the letter, the board agreed to give Powers until the next board meeting, at which time representatives from Marathon and financial firm Raymond James will be expected to address the extent of their commitment to Powers Energy in person.

Ed Cleveland, who represents the construction firms that would build the Powers Energy plant in Schneider, made an impassioned plea to the board for the extension, arguing a Marathon representative could provide a potentially clearer timeline for financing the project.

The largely undisclosed Marathon letter was a far cry from the $300 million-plus that Powers had said he could secure at the end of the 90-day deadline, said waste district board Vice Chairman and Griffith Clerk-Treasurer George Jerome.

"We have granted extension after extension after extension," Jerome said. "We were adamant. ... The 90-day benchmark has not been met."

Jerome was among the eight board members who voted against an extension.

Board Chairman Rick Niemeyer, a Lake County councilman, also voted against the extension.

But Crown Point Councilman Bob Clemons and Merrillville Councilman Tom Goralczyk both argued that the company deserved more time to arrange for potential financiers to address the board.

Niemeyer disagreed.

"We were very emphatic 90 days ago. ... We were assured we would have it (all of the financing) 90 days ago tonight. Everybody agreed to that," Niemeyer said. "Now we have this (letter) coming at the end, and nobody has had time to look at it."

Marathon representatives were not present at the Thursday meeting and could not be reached for comment.

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