The Missouri Department of Natural Resources has granted a preconstruction waiver for a proposed ethanol plant in Scott City that will allow construction of the $200 million facility to begin after the start of the year.

The waiver grants Ethanex at SEMO Port that authority to begin construction immediately, but president and CEO Al Knapp said that will start sometime after Jan. 1. The company will start hiring employees in the first or second quarter of 2008, he said, with production to begin later that year.

"It's a huge step in the process," Knapp said. "But I want to stress we do not have an official permit yet. But the state has reviewed our application and they're satisfied enough with that application to give us a waiver."

The department must complete a technical review of Ethanex's permit application before production starts, according to DNR spokeswoman Renee Bungart. Knapp was hopeful they'd have full permit approval in the next few weeks, he said.

The ethanol plant is a joint venture between SEMO Milling, a corn mill expected to begin operations next month, and Kansas-based Ethanex Energy North America Inc., which designs and develops ethanol plants.

Bungart said the department's air pollution control program granted the requested waiver, but that does not automatically guarantee the plant will get full approval. She said the waiver means that the state is satisfied with plans so far. A construction permit must be on file before a waiver can be granted, she said.

"We're just looking to protect air quality," she said.

After a construction permit is granted and the plant is completed, the plant will operate for a time without an operational permit while the state reviews the plant's operations. If the plant meets all air quality standards, it will be granted an operational permit, she said.

"But based on the information we have now, they are meeting the requirements," she said.

Knapp said the plans are in the design stage. Fill work on the plant site was recently finished. The company was required to fill 431,000 cubic yards to raise the plant above the 500-year flood plain. The plant, according to the state, is expected to be a state-of-the-art plant producing 132 million gallons of fuel-grade ethanol per year. Ethanol is a corn-based renewable fuel being used to increase octane and improve the emissions quality of gasoline.

The plant is expected to create between 90 and 100 jobs. The plant will be a "food/fuel" facility, meaning it will create ethanol as well as human-grade corn products.

Seventy-five to 80 percent production will be geared toward ethanol production for companies like Chevron, and 20 to 25 percent will be food-grade products, such as cereals, brewer grits, fish batter and breading for companies like Kellogg and Gilster-Mary Lee.

Port's largest customer

Port authority executive director Dan Overbey said the port has been in extensive discussions with Ethanex about how the port can best provide barge, rail and truck access.

"It involves a lot of considerations for them and us," Overbey said. "They will be our largest customer at the port. We have to figure out what's needed to serve them, while also taking care of our existing customers."

As part of Ethanex's land lease for 28 acres, the company has access to the Mississippi River harbor and some barge spots to unload corn and to ship ethanol, Overbey said. The company's main plan, however, is to ship ethanol largely by rail car and some by truck, he said.

The port has added a street entrance, which will be the main entrance to the ethanol plant, he said. That will help relieve some of the traffic on Route AB into the port.

Ethanex will be building some additional railroad tracks, but the port and the company are still looking at how much and where it will actually go, Overbey said.

"We've been fortunate, I guess," Overbey said. "There's been some good planning and some dumb luck. But things are going really well so far."

The plant will be to the west of the harbor, north of the railroad track and south of the river, Overbey said.

smoyers@semissourian.com

335-6611, extension 137