Problem-plagued INEOS closing down; plant for sale
The $130 million INEOS biofuel plant on Oslo Road – which opened with great fanfare and huge government subsidies in 2013 – will close its doors in six months, according to informed sources. In the meantime, INEOS’ parent company is seeking a buyer for the property.
County Administrator Jason Brown confirmed that the plant, recipient of the second largest taxpayer investment in Indian River County history, is indeed shutting down. The closure looks to put between 50 and 60 well-paid employees out of work.
After a heads-up on the planned closure from a former INEOS worker, Vero Beach 32963 contacted the local plant, and was referred to the company's Houston operation, where Manager of External Affairs Charles Saunders relayed a terse official statement: Plant owner INEOS Group Limited is “seeking potential buyers” for its local facility.
INEOS Group Limited is a global manufacturer of petrochemicals based in the United Kingdom. It sold government officials on its Indian River County plant, INEOS Bio, with promises to produce up to 8 million gallons of ethanol per year from fermenting yard waste, securing $50 million from the U.S. Department of Energy, millions more from Rick Scott’s economic development team, as well as almost $1.2 million in county job incentives and tax credits.
In the three years since the grand opening, the plant has been plagued by a series of miscues and malfunctions and has never produced marketable quantities of ethanol, a fact state government officials and company executives attempted to conceal behind a cloak of secrecy that got thicker as time went on.
From the beginning, the plant was caught in a roller coaster cycle of repeated start-ups and shut-downs as employees tried to get the cellulosic ethanol production technology online.
Shortly after a Florida Department of Environmental Regulation report revealed that INEOS had produced no biofuel in 2013, the department's general council decided specifics on how much fuel – or whether any fuel – had been produced at the plant would be considered proprietary information (aka trade secrets) and, thus, no longer available to the public – despite the tens of millions in taxpayer dollars invested in the operation.
With local company employees forbidden to talk to the press on pain of firing, obtaining information about what was happening at the plant became increasingly difficult.
In September 2014, INEOS Bio reported its Vero Beach facility had “recently completed a major turn-around” that included technology upgrades intended to bring the facility back on-line. A scrubber was installed to remove impurities from a “process stream that was negatively impacting operations.”
However, in January 2015, Vero Beach 32963 discovered that operations had again been halted, mainly because bio-organisms essential to the fermentation process were being destroyed by high levels of hydrogen cyanide created during ethanol production, and rumors began to swirl of employee health and safety issues at the plant – claims management has always denied.
In the wake of revelations by Vero Beach 32963 that the plant had generated little if any of the product it was built to produce, informed sources said plant operators were given a deadline by the company’s owner: Get the ethanol flowing soon or you will all be looking for work.
According to sources, a new manager was brought in to help solve boiler and turbine problems, and in July 2015 INEOS management apparently decided Indian River County yard waste it was using as fermentation feedstock was to blame for the plant's failure and considered importing feedstock from out-of-county or even out-of-country.
Now, three years after announcing its grand plans to produce a river of eco-friendly biofuel, INEOS has thrown in the towel. What some experts in the industry have found to be true seems to apply here: So far, cellulosic ethanol technology seems to work in the pilot project phase, but falters when it is scaled up to a commercial-size operation.
The failure of INEOS “is not another Digital Domain,” said County Administrator Brown, referring to what might be the largest jobs incentive failure in state history: Digital Domain Media Group declared bankruptcy and closed its Port St. Lucie animation studio in 2012, putting hundreds of people out of work and creating a bond payback burden for St. Lucie County, as well as tens of millions of dollars in losses from defaulted state and private loans and incentives.
Since starting operations in Indian River County, Brown says, INEOS has received $1,167,000 in County tax credits and job incentive payments, but has paid $1.4 million in local property taxes.
The County funding INEOS received, Brown explains, has been no more than what is available to any new business that qualifies for the County's incentive programs.
He says INEOS intends to keep its facility open for the time being so potential buyers can see it as an active facility. Yard waste mulching will also continue for now.
Of the INEOS experience, Brown simply says, with only a touch of weariness in his voice, “We wish them the best.”