South Bend ethanol plant files for Chapter 11 Bankruptcy - Fox 28: South Bend, Elkhart IN News, Weather, Sports

South Bend ethanol plant files for Chapter 11 Bankruptcy

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South Bend-based New Energy Corporation, which runs Indiana's oldest ethanol plant, has filed for Chapter 11 Bankruptcy.

New Energy made the filing in a federal bankruptcy court on Friday.

According to court documents, the company says the amount it can sell the ethanol it produces has been consistently less than the corn it takes to make it since late 2011.

In October, New Energy says the Department of Energy, to which the company owes approximately $33.3 million dollars, requested the company sell its assets in bankruptcy. The company says the DOE agreed to the Chapter 11 filing in order to maximize the value of the company in a sale. A Chapter 11 filing allows the company to restructure.

The company says it has taken several steps to try and get back to profitability, including cutting its workforce from 126 to 90 in June 2011, cutting payroll by 20% in July of 2012, to buying ethanol instead of making it to meet customer commitments.

The South Bend plant has been in operation since 1984. The company says it is capable of producing 100 million gallons of ethanol a year.

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