GreenWood, ZeaChem strike poplar deal

February 17, 2008: Boardman, OR

GreenWood Resources, new operator of the 17,000-acre tree farm near Boardman, has signed a non-binding letter of intent to supply poplar feed stock to ZeaChem Inc.

The long-term agreement is intended to support an initial 1.5-million-gallon-per-year cellulosic biorefinery ZeaChem plans to build at the Port of Morrow. Plant engineering already has started.

Additionally, ZeaChem and GreenWood agreed to explore increasing the scope of the relationship to accommodate additional capacity at the proposed refinery and other future sites through the potential development of short-rotation poplar biomass energy tree farms integrated with ethanol conversion technology.

Jeff Nuss, GreenWood's president and chief executive officer, said his company is eager to commit "a portion of the existing residual fiber from the GreenWood Tree Farms."

GreenWood and Collins Companies of Portland are building a mill amid the poplar plantation. It is expected to be in operation later this year.

Nuss also said GreenWood plans to use its expertise in silviculture, germplasm, irrigation technology and global organization together with ZeaChem's approach to producing cellulosic-based chemicals and ethanol.

"We look forward to working with ZeaChem as it commercializes its process," Nuss said.

James Imbler, president and chief executive officer of ZeaChem, said the letter of intent is a win-win for both companies.

"It allows GreenWood to benefit from the development of the growing market demand for cellulosic-based chemicals and ethanol, while providing ZeaChem with a dedicated long-term cellulosic feed stock source from the leader in intensively-managed hybrid poplar trees."

Hunter Brown, a spokesman for GreenWood Resources, said his company also talked with Pacific Ethanol, which has announced intentions to build a cellulosic ethanol plant near its Boardman plant.

"GreenWood Resources believes that hybrid poplar will be a feedstock of choice for dedicated energy crops, for cellulosic ethanol," he said.

The firm also is considering expanding the farm.

"The Boardman tree farm, as it exists today, could not supply all of the feedstock for the products that are contemplated out there," Brown said.

He expects cellulosic ethanol plants will use other feedstocks as well.

"We don't think poplar's going to be the only one," he said, "but we think it's going to be one of the important ones."

By Dean Brickey, for the East Oregonian