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December 18, 2006
BLUE SUN RISES OVER PANHANDLE

By stressing quality, Blue Sun Biodiesel has continued to grow and benefit Nebraska farmers since its founding in 2001. The company sells a high performance biodiesel, Blue Sun Fusion, a diesel blend that's 20% vegetable oil.

The company has been contracting with Nebraska farmers since 2004 to grow canola, brown mustard and, more recently, camelina. The oilseeds produce quality vegetable oil for the fuel.

Air standards and diesel prices have many diesel users trying biodiesel for the first time. Company strategy, says Ryan Lafferty, research associate with the Westminster, Colo., firm, is to offer a quality, branded product users can learn to rely on. Name recognition helps.

"We're very quality-oriented," says Lafferty. "There's a lot of technology out there, but only one right way to do it for us." Blue Sun Fusion is sold in retail stations and by authorized distributors in Colorado, New Mexico, Wyoming and Nebraska.

In Nebraska, it is sold in the Panhandle by United Farmers Cooperative. Farmers and private users can buy Blue Sun Biodiesel for their own storage tanks.

Biodiesel is produced by chemically modifying vegetable oil or animal fat for fuel use. It is generally blended with petroleum diesel. Blue Sun's quality standards are too high to allow use of animal fat or recycled restaurant cooking oil in its blend, Lafferty says.

Blue Sun is building infrastructure, with the hopes of soon being "vertically integrated" all the way to the farm gate.

The cooperative began inviting farmers to join and to grow oilseeds in 2003.

Charlie Rife, Torrington, Wyo., is the cooperative's oilseed breeder. He works with farmers and researchers in Nebraska, Wyoming and Colorado, trying to come up with the oilseed varieties and best-management practices to give farmers the highest-quality oilseeds for their growing conditions.

His interest centers on canola, brown mustard and camelina because, he says, they produce a high-quality biodiesel fuel. After the oil is removed, it is turned into fuel by a transesterification process that removes the glycerin in the oil.

Blue Sun currently has no oilseed processing facilities. Oilseeds for company use are custom-processed at a crushing plant in Lamar, Colo. Because demand for Biodiesel has outpaced the area's supply

of oilseeds, which producers are just learning to grow, Blue Sun also buys soybean oil to meet its production needs.

Rife says the company would eventually like to build an oilseed plant or make an arrangement with a producer group that builds one. Two farmer groups showing an interest in producing oil from

the oilseeds they grow to save transportation costs are Progressive Producers Non-stock Cooperative of Sidney and Blue Sun Producers, a Colorado producer group.

By Ann Toner; Nebraska Farmer; December 2006

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