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Biofuels firm wins verdict over Colwich ethanol site

  • The Wichita Eagle
  • Published Monday, July 18, 2011, at 10:15 a.m.
  • Updated Tuesday, July 19, 2011, at 12:33 a.m.

Abengoa Bioenergy is still eyeing a new ethanol plant next to its existing one in Colwich as it works through a series of stiff legal and economic challenges.

Last week, a jury in St. Louis County, Mo., awarded Abengoa $48.4 million for what it decided was a 2006 mistake by Chicago Title Insurance Co. that caused Abengoa to build in Illinois rather than Kansas.

Abengoa was seeking a rezoning for a plant site in Colwich. The company hired Chicago Title to research all the property owners legally required to be notified for a rezoning by the city of Colwich.

But Abengoa said in the suit that Chicago Title left seven property owners off the list.

Some of the property owners used the mistake to challenge the rezoning. That case was settled in favor of the city in April, said Abengoa attorney Grant Davis, when the Kansas Supreme Court elected not to hear the case and let stand an earlier decision by the Kansas Court of Appeals.

Because of the lengthy court case over the rezoning, Abengoa built the plant in Granite City, Ill., rather than Colwich. The decision cost Abengoa $48.4 million, Davis said, because a plant in Colwich would have opened sooner and been less expensive to operate.

Chris Standlee, executive vice president for Abengoa Bioenergy U.S. Holding Co., said the company still likes the Colwich site.

The company had planned to build a plant that would produce up to 100 million gallons of ethanol a year and employ 78 people.

But, Standlee said, the company has no immediate plans to build.

The financial and ethanol markets have changed dramatically since 2006 when demand for ethanol was growing and financing was easy.

"We'd still like to do that," he said. "Whether or not that is financially feasible at this point is another question."

Chicago Title couldn't be reached for comment on Monday.

Attorneys representing the company told the St. Louis Post-Dispatch on Friday that they had no comment.

Reach Dan Voorhis at 316-268-6577 or dvoorhis@wichitaeagle.com.

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