BASEHOR, Kan. -- Ethanex Energy, Inc. has entered into a joint venture with Star Ethanol LLC for the construction and operation of an ethanol facility located in Franklin County, Illinois.



The facility will incorporate the fractionation technology developed at Ethanex's SEMO plant and will produce 132 million gallons of fuel-grade ethanol per year.



The joint-venture company will be known as Ethanex Southern Illinois. Initially the joint venture will be 85-percent owned by Ethanex Energy and 15-percent owned by Star Ethanol. Ethanex Energy will secure financing for the project as well as oversee the design and construction of the plant.



Construction is expected to begin during the first quarter of 2007 and the facility is expected to be completed during the second half of 2008. Once the plant is operational, Ethanex will operate and market the ethanol and ethanol related products produced. Star Ethanol has the right to secure an additional 10-percent ownership interest in the joint venture through further capital contributions made before mechanical completion of the facility.



"We are excited to announce the strategic relationship with Star Ethanol. This project incorporates all of the elements required to create a world-class ethanol manufacturing facility. The partnership with Star Ethanol will enable us to get this plant up quickly, benefiting everyone involved," said Al Knapp, president and CEO of Ethanex. "Ethanex Energy's technology, project development and operations expertise combined with Star Ethanol's current location creates a strategic partnership capable of implementing the project efficiently and cost effectively, adding value to Star Ethanol and Ethanex shareholders." .



Ethanex Energy Inc. is a renewable energy company whose mission is to become the ethanol industry's low-cost producer. Ethanex Energy is currently developing three ethanol production facilities located in the Midwest, with a combined production capacity of approximately 300 million gallons of ethanol per year. The company expects these three plants to be operational in 2008. Ethanex Energy is based in Basehor, Kan., with offices in Santa Rosa, Calif., and Charleston, S.C.



SOURCE: Ethanex Energy via Business Wire.