$650 million contract between New Energy Blue, ARCO/Murray for biomass refineries

America’s clean-energy developer New Energy Blue and construction conglomerate ARCO/Murray have announced partnership to build out the New Energy Biomass Refinery designed platform across the American Midwest. New Energy Blue owns technology that converts agricultural waste into lowest-carbon biofuels and biochemicals.

ARCO/Murray will construct the flagship New Energy Freedom biomass refinery in Mason City, Iowa, to sustainably process corn stalks into second-generation fuel ethanol and clean lignin at large commercial capacity. The partners have agreed to a $650 million construction contract.

In 2023, New Energy Blue completed the design engineering, obtained local permits to proceed, and conducted field trials of new harvesting methods and machinery; in 2024, the project entered the final investment decision (FID) phase. The partners plan to break ground later this year and start up the refinery in 2026.

The significant economic impact anticipated is comparable to that typically seen with first-generation ethanol facilities. Local corn growers stand to benefit by not only selling their excess corn stalks to the refinery but also participating in profit-sharing through the New Energy Farmers business unit.

Patrick Hidder, EVP of ARCO/Murray, says, “We are excited to partner with New Energy Blue on this groundbreaking biomass refining project, reflecting our shared commitment to sustainability and innovation in the renewable energy sector. We welcome the opportunity to help launch a nascent industry dedicated to decarbonizing this country’s fuel and chemicals.”

James Foster, Vice President of Construction for New Energy Blue, says the selection of ARCO/Murray as engineering, procurement, and construction (EPC) contractor “has paid off immediately. Their involvement is letting us accelerate the project schedule, manage costs, and provide the necessary bonding capacity needed to satisfy finance. ARCO/Murray’s expertise in process piping, water treatment, anaerobic digestion, and power solutions has already added significant value.”

Following Freedom’s successful completion, New Energy Blue and ARCO/Murray have agreed to extend their partnership to four more New Energy biomass refineries in the next five years, clustered near the first to take advantage of the area’s superabundance of corn stover. Harvesting within a 30-mile radius of each operation makes it possible to build refineries with twice the output of Freedom.

The new partners envision exponential growth: 15 biomass refineries operating by 2030, 150 by 2040, and 500 by 2050—generating an annual total of 21 billion gallons of 2G ethanol from leftover stalks and straws as well as perennial energy grasses like miscanthus. Predictions based on New Energy Blue’s latest independent life-cycle analysis are heartening: 500 refineries can keep more than 130 million tons of CO2 out of the atmosphere every year, an essential reduction in the effects of climate extremes on human health.