Renewable Energy Group (REG) announced Friday that it will invest $31 million to upgrade and enhance the company’s biodiesel refinery in Danville, Illinois.

REG officials gathered in Danville with local and area leaders to break ground on the project. The most notable upgrade will be the addition of biodiesel distillation capabilities to the 45-million gallon nameplate capacity biorefinery. 

Other planned upgrades include pretreat capacity improvements, along with storage, logistics and other optimization enhancements.

“REG Danville already has a proven record of success as part of our network of multi-feedstock biorefineries,” said Daniel J. Oh, the company's CEO. “Enhancing the capabilities here, as we have done at several of our other plants, can allow REG to provide greater volumes of lower cost, lower carbon, higher quality advancedbiofuel to our customers that increases energy security, food security and environmental benefits for North America."

The distillation process removes impurities and leaves behind a pure form of biomass-based diesel that far exceeds industry quality standards, according to company officials, while meeting REG’s more rigorous REG-9000 specifications. The fuel also performs better in colder temperatures.

“These upgrades increase this biorefinery’s strong and healthy appetite for lower cost, waste feedstocks which are sourced locally and regionally from our supply chain partners,” said Brad Albin, vice president of manufacturing at REG.

Fifth Third Bank will reinvest in the REG Danville facility by financing up to $12 million of the cost of theproject. The existing loan facility, which was nearly paid off, will provide additional funds and the term will be extended to December 2017.

REG acquired the Danville biorefinery in 2010. The plant currently employs 34 full-time workers and the upgrade project will utilize an additional 80-100 full-time contract workers.

The Danville project marks the sixth major biorefinery enhancement REG has undertaken since late 2012, following completed upgrades at their Albert Lea, Minnesota; Seneca, Iillinois, Mason City and Newton, Iowa, biodiesel plants; and ongoing improvements at the company’s renewable hydrocarbon diesel biorefinery in Geismar, Louisiana.