BioFuels Journal

Grapevine, TX—GREENHUNTER ENERGY, INC. (AMEX: GRH), announced September 15 the results of a preliminary damage assessment at its Renewable Fuels Campus in Houston, Texas, which includes the nation’s largest biodiesel refinery.

The facility had been completely shut down in the 48 hours prior to the hurricane strike, and all personnel had been evacuated.

Damages sustained at the facility were largely due to floodwater, which crested the 100-year flood plain level, rather than anticipated wind damage from Hurricane Ike.

Structural losses at the facility include damages to offices, piping between some reagent tanks, some small and intermediate tank foundations, two bulk storage tanks - one vegetable oil feedstock tank and one methanol tank.

The vegetable oil tank contained edible canola oil and the facility released some canola oil off-site due to high water.

The release of canola oil to the environment was estimated at less than 50 barrels.

In response to the release of the vegetable oils into the environment, the Company promptly notified all appropriate local, state, and federal agencies, as well as the Company’s third-party oil spill response organization.

GreenHunter Energy’s Renewable Fuels Campus is currently without power or utility service, and will likely be out of operations for six to eight weeks.

This estimate includes the expected timeframe in which the Company’s local utility in Houston, Center Point Energy, is able to restore electricity and natural gas service to the location.

In the short term, temporary interruptible power will be provided by diesel and gasoline-powered generators with 600 kW and 5 kW capacities, respectively.

Over the weekend, the Company was able to procure from the Gulf Coast of Louisiana, these generators which previously had been shipped there as backup power supply in the wake of Hurricane Gustav.

Commenting on the structural damage at GreenHunter Energy’s Renewable Fuels Campus, Bruce Baughman, Senior Vice President of Technology and Engineering for GreenHunter BioFuels, stated, “So far in our assessment of this disaster, we have concluded that fortunately, damage to major process equipment is minimal.

"We have discovered damage to smaller reagent tanks, intermediate tanks and their interconnecting piping and pumps, as well as damage to the foundations of smaller tanks.

"Given the sheer volume of water and the extreme flood levels that we faced, our initial assessment is that we sustained overall minor to moderate impact to the Renewable Fuels Campus from Hurricane Ike.”

Gary C. Evans, Chairman, President, and Chief Executive Officer of GreenHunter Energy, Inc., stated, “Our first concern has been the lives and well-being of our employees and their family members who are located in Houston.

"We have notified our respective property insurance carriers who are in the process of sending response team adjusters to Houston.

"With an understanding of our visual assessment of water damage and knowing firsthand the commitment and dedication of our people employed at our Renewable Fuels Campus, I am highly confident in our ability to return the nation’s largest biodiesel refinery back to operational status as soon as possible.

"We are dedicating all of our Company resources deemed necessary to ensure this is accomplished as quickly as possible for the benefit of our shareholders.” For more information, call 972-410-1044.

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