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Monday December 15, 5:05 pm Eastern Time
Company Press Release
SOURCE: High Plains Corporation
High Plains Corporation Announces Acquisition of New Mexico Ethanol
Plant
WICHITA, Kan., Dec. 15 /PRNewswire/ -- High Plains Corporation (Nasdaq: HIPC - news) today announced that it has
completed the acquisition of a 15 million gallon per year Ethanol plant located in Portales, New Mexico. The plant was
acquired for $4 million cash from Giant Industries Arizona, Inc., a petroleum refiner and marketer which had operated the
plant from 1991 until record high grain prices forced a shut-down in 1995.
''This acquisition will increase our Company's Ethanol production capacity by 25% at an acquisition cost of less than $.30 per
gallon, even after the capitalization of expected refurbishment costs,'' said Raymond G. Friend, President. ''Some maintenance
and refurbishment of the plant is anticipated, but the total cost of these initial capital items is not currently expected to exceed
$500,000.''
''We plan an having the plant operational by the first week of February, 1998, and the location will give us an additional
gateway to the West for product distribution, including major sales into the Southwest. The location of this plant could become
even more important if California removes its oxygen cap, or if the National Academy of Sciences recommends a vapor
pressure waiver for Ethanol in the Reformulated Gasoline Program areas.''
''The Portales area grain market is inconsistent, but current crops are good, resulting in relatively low feedstock prices. With
the volume of grain purchased by High Plains, and our current hedging and risk management strategies we feel that we can
arrange grain supplies for the plant at economical numbers. We also anticipate that our experience and expertise in the industry
will allow us to make various changes to the Portales plant which will increase its efficiencies, making it potentially a very
valuable asset for High Plains.''
Financing for the acquisition was provided by the Company's existing lender, National Bank of Canada, at rates similar to the
Company's existing long-term debt.
Based in Wichita, Kansas, High Plains Corporation is the only publicly traded company whose sole business is Ethanol. It is
one of the largest producers of Ethanol with approximately 60 million gallons per year of current capacity. The acquisition of
the Portales facility will boost future production capacity to approximately 75 million gallons per year. Clean burning Ethanol
reduces pollutants in automotive gasoline and increases octane levels for better engine performance without increasing gas
pump prices.
''The Safe Harbor'' statement under the Private Securities Litigation Reform Act of 1995: This press release contains
forward-looking statements that involve risks and uncertainties, including but not limited to risks detailed from time to time in
the Company's Securities and Exchange Commission filings.
SOURCE: High Plains Corporation
More Quotes and News:
High Plains Corp (Nasdaq:HIPC - news)
Related News Categories: chemicals, oil/energy
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