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Plans for $350M ethanol plant in Mich. announced
Friday June 27, 1:11 pm ET

Michigan offficials announce plan to build big wood pulp energy production plant

LANSING, Mich. (AP) -- Michigan's Upper Peninsula is expected to be the host of a $250 million plant that would turn wood chips into fuel.

Gov. Jennifer Granholm and Boston-based Mascoma Corp. announced some details of the project Friday. The plant will be built at one of two sites under consideration in Chippewa County with the help of a $15 million grant from the state.

The facility could have more than 50 jobs when it hits full production in 2012. Hundreds of jobs could be created in its forest-based supply chain. Granholm said the project overall could help generate 500 to 700 jobs across the Upper Peninsula.

Investors in the project include General Motors Corp. and Marathon Oil Corp.

The ethanol plant is part of the state's strategy to help reduce dependence on oil. Granholm said Michigan's forests, wind and water put it in good position to be an alternative energy leader.

Granholm and Mascoma first announced they were working on a project last year. Friday's announcement provided more details of what they say would be the nation's first commercial scale operation using a particular kind of bioprocessing technology.

The factory will convert wood chips and other non-food fibers to make about 40 million gallons of wood ethanol a year.

The governor said that when Michigan and Mascoma officials first starting working on the project, oil sold for about $67 per barrel. The price was more than $140 per barrel Friday.

"The timing for this project is wonderful," Mascoma CEO Bruce Jamerson said.

Michigan State University and Michigan Technology University will be allied with the project, which could help further the state's alternative energy efforts.

Michigan's alternative energy push is intended to produce both less expensive fuels and jobs for the state's struggling economy.

Michigan's May unemployment rate, 8.5 percent, was highest in the nation.

Source: Associated Press

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