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'BioTown' ethanol firm files for bankruptcy

Norm Heikens
November 1, 2008
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The ethanol producer that planned to build a plant in Reynolds, the town where Gov. Mitch Daniels is attempting to showcase energy independence, has filed for Chapter 11 bankruptcy protection.

VeraSun Energy Corp. announced yesterday that it and 24 of its subsidiaries filed the voluntary petition yesterday in U.S. Bankruptcy Court in Delaware.

The Sioux Falls, S.D., company blamed the move on losses resulting from rising corn prices and tight credit. It said it intends to continue operating as usual.

VeraSun opened a plant in August 2007 at Linden, which is between Lafayette and Crawfordsville.

VeraSun's project in Reynolds, which is north of Lafayette, started in April last year. However, the company announced months later that it would suspend construction because ethanol prices had fallen. The plant was to have capacity to produce 110 million gallons a year.

In September this year, VeraSun said it had hired Wall Street firm Morgan Stanley to evaluate strategic options.

VeraSun trades on the New York Stock Exchange, where its shares have plummeted to 48 cents each from $17.75 as recently as December last year.

Not long after entering office in 2005, Daniels designated Reynolds "BioTown" and planned to demonstrate technology that could make the town independent of foreign oil. Reynolds also was to have shown how waste from nearby livestock farms could be used to generate electricity.

VeraSun operates plants in seven other Midwestern states.

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  1. How much you wanna bet, that 70% of the jobs created there (after construction) are minimum wage? And Harvey is correct, the vast majority of residents in this project will drive to their jobs, and to think otherwise, is like Harvey says, a pipe dream. Someone working at a restaurant or retail store will not be able to afford living there. What ever happened to people who wanted to build buildings, paying for it themselves? Not a fan of these tax deals.

  2. Uh, no GeorgeP. The project is supposed to bring on 1,000 jobs and those people along with the people that will be living in the new residential will be driving to their jobs. The walkable stuff is a pipe dream. Besides, walkable is defined as having all daily necessities within 1/2 mile. That's not the case here. Never will be.

  3. Brad is on to something there. The merger of the Formula E and IndyCar Series would give IndyCar access to International markets and Formula E access the Indianapolis 500, not to mention some other events in the USA. Maybe after 2016 but before the new Dallara is rolled out for 2018. This give IndyCar two more seasons to run the DW12 and Formula E to get charged up, pun intended. Then shock the racing world, pun intended, but making the 101st Indianapolis 500 a stellar, groundbreaking event: The first all-electric Indy 500, and use that platform to promote the future of the sport.

  4. No, HarveyF, the exact opposite. Greater density and closeness to retail and everyday necessities reduces traffic. When one has to drive miles for necessities, all those cars are on the roads for many miles. When reasonable density is built, low rise in this case, in the middle of a thriving retail area, one has to drive far less, actually reducing the number of cars on the road.

  5. The Indy Star announced today the appointment of a new Beverage Reporter! So instead of insightful reports on Indy pro sports and Indiana college teams, you now get to read stories about the 432nd new brewery open or some obscure Hoosier winery winning a county fair blue ribbon. Yep, that's the coverage we Star readers crave. Not.

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