Husky to get federal subsidy for ethanol plant

WINNIPEG, Manitoba (Reuters) - Husky Energy will collect an operating subsidy of up to C$72.8 million ($67.4 million) for its ethanol plant in Minnedosa, Manitoba, the Canadian government announced on Monday.

The money comes from a federal fund established in 2008 to boost production of renewable fuels. Ethanol from grain, such as that produced at the Minnedosa plant, generates up to 40 percent less greenhouse gas emissions than gasoline, the government said.

The government did not say how long the subsidy for Husky would be in place. Under Ottawa's renewable fuel program, ethanol facilities are eligible for up to seven years.

Canada will require 5 percent renewable fuel content in the gasoline pool by 2010 and 2 percent renewable content in diesel and heating oil by 2011.

($1=$1.08 Canadian)

(Reporting by Rod Nickel; editing by Rob Wilson)