Heron Lake BioEnergy, LLC Finalizes an Industrial Water Supply and Distribution Agreement with the City of Heron Lake, Minnesota
October 04, 2019 at 05:21 pm EDT
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On September 30, 2019, Heron Lake BioEnergy, LLC (the “Company”) finalized an Industrial Water Supply and Distribution Agreement (the “New Agreement”) with the City of Heron Lake, Minnesota (the “City”). The Company and the City previously entered into an Industrial Water Supply and Distribution Agreement, dated October 27, 2003 (the “Original Agreement”), under which the City supplied untreated industrial water to the Company. The Original Agreement expired on February 1, 2019, and, prior to such expiration, the Company and the City agreed to negotiate in good faith to replace the Original Agreement and extend the Original Agreement until a new agreement could be finalized. The New Agreement, which is effective as of February 1, 2019, has a term of ten (10) years, and requires the City to provide certain amounts of industrial water to the Company from the City’s well facilities. In return, the Company will pay both a fixed charge and flow charges to the City. In addition, the Company is required to pay for certain maintenance costs related to the wellfield, well facilities and related distribution infrastructure, to the extent such costs exceed a certain threshold.
Heron Lake BioEnergy, LLC owns and operates an ethanol plant near Heron Lake, Minnesota with a permitted capacity of approximately 72.3 million gallons per year of undenatured ethanol on a twelve-month rolling sum basis. In addition, Heron Lake BioEnergy, LLC produces and sells distillersâ grains with solubles and corn oil as co-products of ethanol production. The Companyâs segments include Ethanol Production and Natural Gas Pipeline. Heron Lake BioEnergy, LLCâs wholly owned subsidiary, HLBE Pipeline Company, LLC (HLBE Pipeline Company), is the sole owner of Agrinatural Gas, LLC (Agrinatural). Agrinatural, is a natural gas pipeline company that owns and operates the natural gas pipeline that provides natural gas to the Companyâs ethanol production facility and other customers through a connection with the natural gas pipeline facilities of Northern Border Pipeline Company in Cottonwood County, Minnesota.