New Heaven Chemicals in Manly to start sodium methylate in February - Post Bulletin | Rochester Minnesota news, weather, sports

MANLY, Iowa — Iowa's first sodium methylate manufacturing facility will start production in early February. Construction at New Heaven Chemicals, located within the Manly Terminal area, is moving full

MANLY, Iowa — Iowa's first sodium methylate manufacturing facility will start production in early February.

Construction at New Heaven Chemicals, located within the Manly Terminal area, is moving full speed ahead. Prasad Devineni, director of New Heaven Chemical Inc., said work will be completed by February.

Devineni and H. Ramesh, managing director of TSS Group, of India, parent company of New Heaven Chemicals, led a news media tour of the site in December. Storage tanks were being assembled, work was underway around the distillation columns and boilers, and the control house was being built. Construction on the fully automated plant started in early 2015. It is the company's first location in the United States.

Sodium methylate is a catalyst used to convert soybean oil to biodiesel. The plant will produce 18,000 metric tons initially with an expansion to 24,000 metric tons in the future. Capital investment for the first phase is $15 million. Phase two will be another $5 million. New Heaven has signed a 30-year lease with Manly Terminal.

The Iowa Economic Development Authority and Worth County have provided incentives and tax breaks that were helpful, Devineni said.

IEDA gave the company a $128,000 loan, $64,000 of which is forgivable, and $402,000 in High Quality Jobs Program tax credits. The Worth County Supervisors provided a $30,000 cash incentive and a five-year tax increment financing rebate of 100 percent. The county also worked with Alliant Energy to bring natural gas and electrical infrastructure to the site.

Forty construction workers are on the job. Dean Snyder, of Clear Lake, Popp Excavating, of Manly, Plaas and Knobelsdorf, of Red Wing, Minn., and Construction Concepts and Eastern Iowa Builders, of Davenport, are among project contractors.

The plant will employ 16 to 20 local workers when it's operational. The jobs are medium to high paying, Devineni said. The company is seeking individuals with chemist, chemical engineering and other four-year science degrees as well as job experiences within the chemical or fuel industries.

Manly Terminal was the right location for the plant because methanol and caustic flakes, raw materials used in producing sodium methylate, are stored here, Devineni said. Raw materials will come by rail and the finished product, sodium methylate 30 percent solution, will be shipped out by trucks.

"The attractiveness of the Manly site is rail, trucks and raw materials all in one place," Devineni said. "Manly terminal is a biofuels hub, which complements our business interests. They support what we do, and we support what they do."

Manly Terminal has direct tariff access to the nation's Class I Rail Carriers through the Iowa Northern Railway Company.

Leanne Elwood, with sales and marketing at Manly Terminal, said the facility targets the ethanol and biodiesel industries.

"New Heaven Chemicals is a very good fit for us," she said.

"Our customers are biodiesel plants and most are located within 100 miles," Devineni said.

New Heaven Chemicals is the only firm manufacturing the biodiesel catalyst in the Upper Midwest and will be the second in the United States, Devineni said. The first is in Alabama. The firm recently announced it will build a second plant in Texas once the Manly facility is operating. They would have expanded in Manly but there are natural gas constraints.

A TSS Group subsidiary manufactures sodium methylate in Dammam, Saudi Arabia. That plant, which has a 48,000 ton capacity, has been selling product to U.S. customers.

"We do not want to do that any more," Devineni said. "We expect the U.S. biodiesel industry to be stable and sustainable. We want to manufacture catalyst where our customers are located."

Once the Manly plant is operating, product from Saudi Arabia will be shifted to customers in Southeast Asia, where there is a growing market, Devineni said.

Teresa Nicholson, executive director of Winnebago-Worth Betterment Council, said the economic impact from New Heaven Chemicals is big. Gross revenues at the site will be $15 to $20 million annually.

"During construction they are buying food and gas and staying in hotels," she said. "It will continue to be big."

It has been exciting to see New Heaven grow from the ground up in north Iowa, providing excellent paying jobs and producing a product that is used in the renewable fuels industry, Nicholson said.

For more information on the company visit newheavenchemicals.com.

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New Heaven Chemicals in Manly to start sodium methylate in February - Post Bulletin | Rochester Minnesota news, weather, sports