Peoria Station

Peoria area railroads got an early Christmas present yesterday upon news that MGP Ingredients of Illinois’ Pekin distillery, shuttered since February, will reopen sometime next year under a partnership with Houston-based SEACOR Energy, Inc. Press releases and articles published by newspapers offered the following details:

- The distillery will be owned and operated by a joint venture called Illinois Corn Processing LLC. SEACOR Energy paid $15 million for its 50% stake.

- Full production of 90 million gallons annually will be dedicated to producing beverage, fuel-grade and industrial alcohol. SEACOR Energy will market the fuel-grade alcohol and MGP Ingredients will market the beverage and industrial alcohol.

- 60 workers laid off in February will be recalled.

- Their are no plans to resume operations at the Protein & Starch facility, which closed in November 2008.

- The Pekin Daily Times reporter apparently asked whether alcohol for San Francisco-based Skyy Vodka would resume production at Pekin. An MGP official could not say.

MY TAKE: This being a transportation blog, the obvious question is how will area railroads benefit from the resumption of a major rail-dependent industry? Full production at 90 million gallons-a-year translates to 3,000 annual carloads if shipped in 30,000-gallon tank cars. Similarly, some 315,000 tons of distillers grains (DDGS) equals 2,600 carloads if shipped in 120-ton covered hoppers. The amount of corn needed would equal about 6,700 carloads if shipped in 100-ton covered hoppers.

In the past, the actual number of carloads generated by MGP’s Pekin distillery was actually far less as most corn will arrive by truck and much of, but not all, alcohol and DDGS will leave by truck, or in the case of alcohol, by barge as well. (Corn sometimes arrives by rail during the summer months when local stocks are exhausted, and shipping distances from suppliers justify rail transportation.) Nevertheless, area railroads will benefit from the return of several thousand annual carloads.

One other benefit to area railroads is that Praxair’s adjacent carbon dioxide gas processing plant should resume production. Praxair likely loaded at least several railcars a week.

The Tazewell & Peoria Railroad served MGP Ingredients’ distillery via industrial trackage along Pekin’s riverfront. That railroad will serve Illinois Corn Processing LLC. Sister Illinois & Midland Railroad has access to MGP from the other end of the plant.

- David P. Jordan