Panda Ethanol Inc. recently announced that it has successfully restructured the funding arrangements on the company’s 115-million gallon-per-year, biomass-fueled ethanol refinery, located in Hereford, Texas. The restructuring was made with the support of the project’s senior and subordinated lenders and will allow for the completion of construction and startup of the facility by late January 2009.
As a part of the restructuring, the Hereford project’s senior lenders waived all existing defaults occurring under the original financing agreements allowing the project to make construction-related borrowings of up to $31.5 million. The project can also draw upon $2.5 million in new proceeds received from the Hereford subsidiary’s subordinated lender. Panda Ethanol, the parent company of the Hereford project, will also receive $2.5 million in working capital as the result of a new equity investment from Panda Energy International, Panda Ethanol’s founder and single largest shareholder.
When completed, Panda Ethanol’s 115-million gallon-per-year ethanol refinery, located in Hereford, Texas, will be the largest biomass-fueled ethanol plant in the United States with one of the lowest carbon footprints of any similar-sized ethanol facility in the nation.