Valero Renewable Fuels Company, LLC, a wholly owned subsidiary of Valero Energy Corporation, announced it has purchased a corn ethanol plant in Mount Vernon, Ind., from Aventine Renewable Energy-Mt. Vernon, LLC, a wholly owned subsidiary of Aventine Renewable Energy Holdings, Inc.

The plant has an annual production capacity of 110 million gallons and uses Delta-T technology, similar to the process already in use at Valero Renewables' ethanol plant in Jefferson, Wis. The plant has been shut down for approximately two years, but Valero Renewables plans to begin a restart program and resume production within the next several months, it was announced.

The Mount Vernon plant is the 11th corn ethanol plant in Valero Renewables' system and its second in Indiana. The addition will give Valero more than 1.3 billion gallons per year in ethanol production.

This announcement makes it quite obvious that oil companies are seeing the value of continued diversification into ethanol production, especially with the economic forecast that ethanol profits will be easy to obtain with projected corn prices for the next few years. A recent report showed that ethanol plant profits are running at all time highs.  

Valero Renewables noted that the Mount Vernon plant's logistical advantages include ready access to corn suppliers as well as strong rail, truck and barge transportation. The plant is at the Port of Indiana-Mount Vernon on a location leased from Ports of Indiana, the state port authority. That relationship will continue, it was stated.

If the logistics are so good, lower-priced corn is available and ethanol production profits nationally are running high, why was the ethanol plant closed? There was no explanation from Aventine officials. 

Valero Energy Corporation, through its subsidiaries, is an international manufacturer and marketer of transportation fuels, other petrochemical products and power. Through subsidiaries, Valero owns the general partner of Valero Energy Partners LP, a midstream master limited partnership. Approximately 7,400 outlets carry the Valero, Diamond Shamrock, Shamrock and Beacon brands in the United States and the Caribbean; Ultramar in Canada; and Texaco in the United Kingdom and Ireland. Valero is a Fortune 500 company based in San Antonio.