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Central Indiana biodiesel producer files for bankruptcy

April 11, 2012

A biodiesel producer located east of Anderson has declared bankruptcy, citing $17.3 million in debts.

E-biofuels LLC in Middletown filed for Chapter 7 liquidation on April 4. The company lists $11.4 million in assets consisting of equipment and property.

Secured liabilities include loans in the amount of $7.4 million from First Merchants Bank in Muncie, $3 million from Ultra Green Energy Services in Chicago and $1.5 million from Ciena Capital LLC in Greenville, S.C.

E-biofuels began operating in 2007 and had the capacity to produce 10 million gallons of biodiesel per year, according to the Indiana Department of Agriculture.

Whether the company ever came close to producing that amount is unclear. A federal lawsuit filed in 2008 against E-biofuels by Houston-based Vinmar Overseas Ltd. suggests it didn't.

A federal judge ordered E-biofuels to pay Vinmar $930,546 for its claim that E-biofuels failed to supply it 500,000 gallons of biodiesel. E-biofuels paid off the judgment in 2011, the bankruptcy filing said.

Biodiesel is a renewable fuel manufactured from vegetable oils, animal fats or recycled restaurant greases. It can be used as a diesel fuel or mixed with regular diesel to be used in diesel vehicles.

Indiana has four remaining biodiesel plants, in Kosciusko, Lake, LaPorte and Shelby counties, that together are capable of producing more than 100 million gallons of the fuel annually.

Including the E-biofuels plant, the five biodiesel facilities were expected to create 620 jobs in the state, according to the Department of Agriculture.

E-biofuels is owned by Evansville-based Imperial Petroleum Inc, whose subsidiaries include Arrakis Oil Recovery LLC and Ridgepointe Mining Co. Shares of the thinly traded public company are fetching 9 cents each.
 

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