Florida company plans to launch biodiesel plant in S.A.

By Patrice Stewart
San Antonio Business Journal - June 1, 2007

Orlando, Fla.-based Xenerga Inc. is planning to develop four biodiesel plants in the Lone Star state, including one in San Antonio.

The company's $1.95 million 7,000-square-foot San Antonio plant is expected to be up and running by as early as the end of the year. The plants, including San Antonio, are expected to record net profits of at least $2 million during the first year of operation, according to company officials.

Xenerga will bring its first plant in Florida online in July and the company is planning an additional 40 plants across the nation. Other Texas markets on its expansion map over the next two years include Houston, Dallas and Austin.

Xenerga, which was founded in 2006, markets a turnkey investment opportunity that provides the rights and the equipment to individuals or companies to produce biodiesel through partnerships. The company has 25 employees.

According to Dave Jarrett, chief communication officer for Xenerga, executives are interviewing partners for the San Antonio location but decline to release further details until the deal is finalized. He did say the company expects to have a letter of intent signed for the Alamo City market by mid-June.

Jarrett says the company already has a letter of intent to construct a plant in the Dallas area. "We have had a lot of interest from Texas," Jarrett says. "It's going to be a big state for us."

Xenerga has mandated that each of its facilities achieve BQ-9000 accreditation from the National Biodiesel Board. BQ-9000 is a quality assurance program that includes procedures for fuel storage, handling and management.

Biodiesel is a cleaner burning fuel alternative. It can be used in any diesel engine with little or no need for modifications and is made from used cooking oil as well as many other fresh oils -- such as vegetable oil, palm oil and animal fats.

Xenerga has exclusive, long term contracts to purchase waste cooking oil, called feedstock, in the areas where the plants will be located. Jarrett says Xenerga can provide up to 100 percent of the plant's feedstock for producing the biodiesel.

Xenerga, Jarrett says, will receive royalties from the sale of the finished product, which will be a percentage based on how much the plant produces. He adds the plants can produce up to five million gallons of fuel per year.

"Our model is different from other models," says Jason Sayers, founder and CEO of Xenerga. "Many of the plants being built today are 100 million-gallon-per-year plants that require a huge investment and have complicated logistics. We've cut out the logistical problems and we distribute the biodiesel locally without a lot of the distribution costs."

Sayers says the equipment and the facility itself are manufactured and packaged into containers in Germany and shipped to the sites for construction. The plant can be built and up and running in about five days. The local plant will employ about eight people for a 24-hour operation.