Artist's rendering of proposed Fulcrum Centerpoint facility in Gary

Fulcrum BioEnergy's financial woes deflate promises for clean fuels

Contributed By: The 411 News

Setback for Gary facility promising to convert household garbage into jet fuel

Fulcrum BioEnergy, the company that promised to build the world’s largest facility converting household trash into jet fuel in Gary is now on the verge of collapse, according to Bloomberg News.

Bloomberg News report on Fulcrum BioEnergy’s future ran Tuesday under the headline “Waste-to-Fuel Company That Raised $1 Billion Verges on Collapse.”

Fulcrum BioEnergy’s woes come on the heels of the Indiana Dept. of Environmental Management giving it the go-ahead to construct Fulcrum Centerpoint near the Lake Michigan shoreline in Gary’s Buffington Harbor.

Bloomberg reported, “The company recently laid off nearly all of its staff of about 100 and halted most of its operations, according to more than a half-dozen former employees.” The layoffs came on May 17 and Fulcrum’s website also stopped working, Bloomberg said.

Also from Bloomberg, “The dire turn of events raises questions about the future of Fulcrum’s flagship plant in Nevada, located 20 miles outside of Reno, which cost more than $200 million to build and has been plagued by costly technical problems since it began operations in 2022. It also casts doubt on Fulcrum’s garbage-to-fuels plants planned for Indiana, Texas and the UK.”

Fulcrum’s financial problems surfaced in October 2023 with its default on the bonds that paid for the construction of the Sierra BioFuels plant in Reno. The company also announced it was returning to Indiana the $500 million in state backed municipal bonds it was offering to investors to build the Centerpoint plant in Gary.

In a statement from then, Fulcrum’s Rick Barraza said, “Fulcrum's decision to not move forward with the Centerpoint bonds has no relation to the Sierra bonds.” Regarding the bonds for the Reno project, Barraza said, “Fulcrum is working closely with UMB (the Trustee) and the Sierra bondholders to finalize a forbearance agreement to resolve the current matter with UMB.”

Bloomberg said it also learned that Fulcrum was misstating its production of clean fuels at the Reno plant.

A February 2023 press release from Fulcrum stated, “Earlier this month, Fulcrum’s Sierra BioFuels plant in Nevada shipped its first railcar of syncrude made from landfill waste to Marathon Petroleum for upgrading into fuel.”

Bloomberg reported, “Production of fuel had been so limited that the railcar was nearly empty, containing just 350 gallons of fuel, according to four people familiar with the shipment, as well as the delivery’s bill of lading.”

Story Posted:05/29/2024

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