|Monday, September 22, 2014||Search Our Site|
Comment on This Story / Send This Article to a Friend
Business North - The Daily Briefing - Business Newspaper Online
IRRRB funds biochemistry opportunity in Hoyt Lakes
The Iron Range Resources and Rehabilitation Board on April 22 approved $21.2 million in funding to renewable biochemical company Segetis, Inc.
Segetis, a green chemistry business based in Golden Valley, will receive a $20 million loan from the Douglas J. Johnson Trust Fund, which IRRRB administers, to construct a facility at Laskin Energy Park in Hoyt Lakes. The company plans initially to extract and refine sugars from corn grown in southern Minnesota. It will transition by 2018 to extracting sugars from about 90,000 cords of wood annually harvested in a seven-county area. Those sugars can be used to make biochemicals, which are considered more ecologically friendly than petrochemicals.
“Segetis is on the leading edge of the biochemical economy and will add value to our timber and forest products economy,” IRRRB Commissioner Tony Sertich said following the board action. “This innovative company’s presence in our region will help position the Iron Range as a national leader in the biochemical economy.”
IRRRB also will provide a $1.2 million loan to Hoyt Lakes to buy an existing structure from Nott Corp., which ceased light manufacturing operations in Laskin Park during the recession. Segetis would use that structure during its start-up phase.
ALLETE Inc., which generates electricity at the park, will invest $3 million for infrastructure improvements, including a utility building, steam boilers and storage for industrial gases needed by Segetis and future tenants. The Minnesota Department of Employment and Economic Development is providing a $7.1 million grant.
“Segetis will provide an economic stimulus and badly needed jobs,” said Al Hodnik, ALLETE chairman, president and CEO, “and I could not be more pleased for the East Range area. More importantly, it sends a powerful message to those joined with us in sustaining our way of life, just how enduring and transformational our abundant natural resources can be."
Segetis represents the third significant investment into Northeast Minnesota’s new biochemical industry, following Sappi’s production of cellulosic fiber in Cloquet and Lonza’s production of larch arabinogalactan in Cohasset, said Minnesota Power Director of Regional Development Nancy Aronson Norr.
“This is exciting because it identifies emerging technology to promote the sustainable use of our massive wood basket,” she said. “This also puts Minnesota on the radar for other international opportunities.”
UPM, owner of Blandin Paper in Grand Rapids, also has entered the biochemical market. Last June, the Helsinki-based corporation entered into a joint development agreement with U.S.-based Renmatix, which manufactures celluslosic sugar for the biochemical and biofuels markets. The long-term goal is to make cost-competitive bio-based alternatives to petrochemicals. Area officials have declined to comment on how the development might play out regionally.
The Segetis project is forecasted to have an annual $55 million economic impact on the region, supporting over 545 jobs, according to an independent study from the University of Minnesota Extension Center for Community Vitality.
Previous Daily Briefing Articles:
BusinessNorth - The business news source for Northeastern Minnesota and Northwestern Wisconsin.|
P.O. Box 16223, Duluth, MN 55816
Phone: 218-720-3060 Fax: 218-720-3068 firstname.lastname@example.org