GEISMAR, La., May 19, 2008 (PRIME NEWSWIRE) -- Dynamic Fuels LLC has secured preliminary approval from the Louisiana State Bond Commission (SBC) of its application to issue tax exempt Gulf Opportunity Zone (GO Zone) Bonds to fund the building of the company's first renewable synthetic fuels facility in Geismar, Louisiana. Dynamic is a 50:50 venture between Syntroleum Corporation (Nasdaq:SYNM) and Tyson Foods, Inc. (NYSE:TSN) to convert low grade, inedible fats and greases into renewable synthetic diesel, jet and military fuel.
While the amount requested on the application was $135 million, rules recently adopted by the SBC may limit the actual allocation for any single project to $100 million. Dynamic Fuels and its underwriter, SunTrust, will submit terms for the bond sale for final approval by the SBC at its June 19th meeting. The total estimated cost of the project is $150 million. Remaining funding needed to finance the project will be provided by Tyson and Syntroleum.
The availability of the tax exempt Go Zone bonds is the result of the Gulf Opportunity Zone Act of 2005, which is designed to help rebuild economies devastated by hurricanes Katrina and Rita. The Dynamic Fuels venture is expected to generate approximately 250 short-term construction jobs and 65 highly skilled permanent jobs.
"We appreciate the Commission's decision to approve the bonds, which will provide beneficial financing for this project," Jeff Webster, senior vice president of Tyson's Renewable Products Division. "In addition to creating jobs, this value-added venture will give animal agriculture an opportunity to participate in the production of renewable fuels and is also an environmentally sound way to contribute to America's energy security."
"Approval of our application by the Bond Commission is a key milestone in our efforts to build a new industry in this country," said Jeff Bigger, senior vice president of business development for Syntroleum. "Timely action by the Bond Commission permits us to maintain our project schedule and targeted first production in early 2010."
Engineering and environmental work are in progress and equipment requiring a long lead time has been ordered. Construction is expected to begin in the fall of 2008 with completion targeted for the end of 2009. Once in operation, the plant is expected to produce about 75 million gallons of renewable synthetic fuel annually.
The fuel produced by the venture will offer the same benefits of synthetic fuels derived from coal or natural gas while providing substantial performance and environmental advantages over petroleum-based fuels. These benefits include higher cetane levels, which are a measure of combustion quality, and superior thermal stability, making it effective for advanced military applications. In addition, replacing traditional petroleum fuel with this fuel substantially reduces total greenhouse gas emissions.
Various non-food grade animal fats produced or procured by Tyson Foods, such as beef tallow, pork lard, chicken fat and greases, are expected to be used as renewable feedstock for this venture.
About Syntroleum (Nasdaq:SYNM)
Syntroleum Corporation owns the Syntroleum(r) Process for converting synthesis gas derived from biomass, coal, natural gas and other carbon-based feedstocks, and the Bio-Synfining technology for converting animal fat and vegetable oil feedstocks into synthetic liquid hydrocarbons. The Company plans to use its technology to develop and participate in synthetic and renewable fuel projects utilizing the Company's technology in a number of global locations.
About Tyson Foods, Inc. (NYSE:TSN)
Tyson Foods, Inc. (NYSE:TSN), founded in 1935 with headquarters in Springdale, Arkansas, is the world's largest processor and marketer of chicken, beef, and pork, the second-largest food production company in the Fortune 500 and a member of the S&P 500. The company produces a wide variety of protein-based and prepared food products and is the recognized market leader in the retail and foodservice markets it serves. Tyson provides products and service to customers throughout the United States and more than 80 countries. The company has approximately 104,000 Team Members employed at more than 300 facilities and offices in the United States and around the world. Through its Core Values, Code of Conduct and Team Member Bill of Rights, Tyson strives to operate with integrity and trust and is committed to creating value for its shareholders, customers and Team Members. The company also strives to be faith-friendly, provide a safe work environment and serve as stewards of the animals, land and environment entrusted to it.
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Forward Looking Statements
This document includes forward-looking statements as well as historical information. These forward looking statements may include statements relating to costs, timing and production of the fuel plant; job creation from plant; and fuel characteristics, benefits and uses.