Renewable Energy Group renews contract to stay in Newton
Renewable Energy Group announced its REG Newton, LLC loan with AgStar Financial Service, PCA was extended for one additional year. The extension meant that their 21 full-time jobs would remain in Newton.
REG Newton entered into a debt agreement with AgStar in conjunction with the March 2010 acquisition of the assets of Central Iowa Energy LLC.
Nationwide, the biodiesel industry employs around 64,000 workers, with about 7,300 in Iowa. This includes electricians and plant workers. REG has seven biodiesel locations throughout the United States, two of which are in Iowa, and employs 300.
In a press release, REG Chief Financial Officer Chad Stone stated the following about the agreement, which has a new maturity date in March 2014:
“We’re pleased that the lender syndicate saw fit to extend this note in a routine manner.”
Alicia Clancy, manager of corporate affairs, is happy that REG Energy is staying in Newton.
“REG Newton does have an excellent workforce,” Clancy said. “Having a workforce available that concentrates on safety is important. The State of Iowa is a great location for biodiesel.”
She said the reason Iowa has two REG locations is because of its suppliers. Biodiesel is made up from agriculture products such as animal fat and soybeans. REG can offer $16 per animal on beef products.
“It can create value per carcass,” Iowa Secretary of Agriculture Bill Northey said with regard to biodiesel’s impact on agriculture. “Farmers are likely to get a little more (money) in return.”
“Being In Iowa, we get a lot of animal biodiesel,” Clancy said with regard to on why Iowa has two facilities out of REG’s seven.
Iowa is the No. 1 producer of biodiesel in the U.S., which helps local farmers deal with the rising cost of agriculture.
Biodiesel has become increasingly popular over the years, and has helped lower the price of oil. Unlike fossil fuels, biodiesel is a renewable energy source, and does not put any land at risk. There is no drilling and no new land is needed.
One of biodiesel’s main suppliers is the soybean industry. The industry has seen a big increase in demand because of China. Northey said that out of the 20 billion agricultural exports from U.S. to China, 14 billion were soybeans.
“It (biodiesel) started off as using soybean oil,” Northey said. “It uses some corn and animal fat. It creates jobs and communities. It’s a nice way to create jobs and spreads around rural area like Newton.”
Soybean demand has been increasing, and other states have taken notice. Kansas and North Dakota have started contributing to the soybean demand.
Soybeans make food and oil products. As a result, many companies use biodiesel oils in their engines. Not only is the price cheaper then diesel, it helps lubricate the engine more than traditional oils, resulting in a longer life expectancy.
REG is a leading North American biodiesel producer with a nationwide distribution and logistics system. Utilizing an integrated value chain model, REG is focused on converting natural fats, oils and greases into advanced biofuels. With more than 225 million gallons of owned/operated annual production capacity at biorefineries across the country, REG is a proven biodiesel partner in the distillate marketplace.
Matthew Shepard can be contacted at (641) 792-3121 ext. 425 or via email at firstname.lastname@example.org.
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