LOW MOOR — The board of directors of Nova Biosource Fuels, Inc., of Houston, Texas, owner of a refinery east of Low Moor in Clinton County, authorized its management Feb.26 to idle the company’s refinery in Seneca, Ill., and suspend plans for restarting the plant here.

The company has told the U.S. Securities and Exchange Commission that the actions were taken due to the unexpected breakdown of negotiations with a working capital source the evening of Feb. 22 and the inability to obtain financing from other sources in a timely fashion.

“The company is considering its options for restructuring its operations,” a press release said.

The Clinton plant was conceived by a group of local investors in 2004 to turn agricultural products into biodiesel fuel. Construction began in March 2006 and by mid-August 2007 production had begun, plant manager Dan Holesinger told the Clinton Herald in October 2007.

At that time he said local employees worked “hand and glove with the Nova team for nearly three years and were impressed with their technology and knowledge of the biodiesel industry.”.

Nova eventually purchased the plant, where 11 employees kept the refinery running 24 hours a day, seven days a week.

Then, at 2:40 a.m., Sept. 30, a fire broke out in the primary biodiesel recovery column.

“The fire was quickly extinguished by the local fire department,” according to a report to the Exchange.

It was believed the fire was caused by a build up and ignition of methanol vapors in the column during a ventilation process required as part of the maintenance activities.

“No refinery personnel were injured, although one firefighter received minor steam burns as a result of exposure to steam created during the firefighting efforts. Because the refinery was idled for maintenance, there was no biodiesel inventory on site.

The time period for repairs will likely exceed 60 to 90 days and may be combined with previously planned capital upgrades.”

But the Exchange recently notified the company that since Oct. 22, 2008, the company’s common stock has been trading below 25 cents per share and closed at 6 cents on Feb. 26.

The Exchange recommended a reverse stock split. Holesinger refused to comment today about suspension of operations.