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Grafton ethanol plant reaches end: Demolition begins for facility that was once owned by Jamestown businessman

Eric Hylden / Forum News Service Grafton City Administrator Nick Ziegelmann, left, and Mayor Chris West survey the site where demolition of the former ethanol plant is under way on the city's north side Wednesday.

GRAND FORKS -- The former Alchem ethanol plant in Grafton, N.D., is being dismantled, piece by piece, more than five years after it closed and about a year after a plan briefly surfaced about its possible reopening.

"They're scrapping the building out," Grafton City Administrator Nick Ziegelmann said Wednesday.

He said crews have been removing equipment from the complex for several weeks and parts of the building already have been dismantled.

The ethanol plant, which employed about 30 when it closed in 2007, has had a checkered history since the former Borden Foods potato flake processing facility was converted to ethanol in 1985.

At the time, it was one of two ethanol plants operating in North Dakota. The other, the former ADM Corn Processing facility in Walhalla, N.D., closed last year.

Grafton is a Walsh County city of 4,000, about 40 miles northwest of Grand Forks. Walhalla, with about 1,000 residents, is in Pembina County, about 100 miles northwest of Grand Forks.

Past plans

Harold Newman, a Jamestown businessman, was part of the original Alchem ownership group. He later bought out the other investors and invested several million dollars into the facility.

Newman sold the facility at an auction in 2010 to a Minnesota scrap dealer that had bought several other ethanol plants in recent years. At the time, the new owner said he would consider converting it to another use, such as production of other agricultural byproducts, including biofuels or pharmaceuticals.

However, that never materialized, and the property was taken over by a group called Northeast Energy LLC, whose registered agent was Rick Newman, a relative of Harold Newman.

Then in March 2012, Northeast Energy reached an agreement in principle to sell the facility to Energae LP, an investor group based in Clear Lake, Iowa. At that time, Energae officials announced plans at the time to convert the facility to produce ethanol from sugar beets and wheat.

The company had planned to contract directly with growers for 13,000 to 14,000 acres of sugar beets and begin producing ethanol as early as 2012 or 2013.

But the project never got off the ground.

Rick Newman could not be reached for comment Wednesday.

"We were hoping it would get going again," Ziegelmann said. "Those 30 jobs would really help the city. But now it's going to be gone."