Plant Manager Jay Holthus of Hermiston guides Gov. Ted Kulongoski, Rep. Greg Walden, R-Ore., and state Rep. Jackie Dingelder, D-Portland, on a 2007 tour of the Pacific Ethanol Columbia Plant in Boardman. <br><I>EO file photo

Pacific Ethanol has placed four production facilities, including its Columbia plant at the Port of Morrow, in Chapter 11 bankruptcy protection, the company announced Monday.

In a press release, Pacific Ethanol said the parent company and its marketing subsidiaries, Kinergy Marketing LLC and Pacific Ag Products, did not file for bankruptcy and will continue to manage the ethanol production plants under an asset management agreement.

The company and its primary lender, WestLB AG, have agreed to first priority secured debtor-in- possession (DIP) financing, which will infuse Pacific Ethanol with another $20 million to support operations at the Columbia Plant – the only one running – and three other closed ethanol plants.

“We have worked well with our creditors to develop a plan that we believe allows us to continue operations and meet our commitments to our customers and vendors,” said Pacific Ethanol’s CEO and President, Neil Koehler, in the press release.

Pacific Ethanol has been showing signs of trouble for several months. In late February, the company announced it was closing ethanol plants in Burley, Idaho and Stockton, Calif. because of a declining market for ethanol. It closed its first plant, in Madera, Calif., in January.

In March, Pacific Ethanol’s lenders agreed to give the company more time to negotiate new loan terms, but those agreements expired at the end of April.

Pacific Ethanol produces 40 million gallons of ethanol a year at the Columbia plant, and has plans to build a $50 million cellulosic ethanol demonstration plant there. The East Oregonian could not reach a spokesperson for the company who was willing to talk about what the bankruptcy means for the plant and Pacific Ethanol’s $25 million matching grant from the U.S. Department of Energy.

The news sent Pacific Ethanol stock tumbling, dropping 45 percent to 31 cents per share.