(RALEIGH) -- A company that wants to turn grass grown on North Carolina hog farms into motor fuel is getting the federal backing it wants to build an ethanol plant. The USDA is giving Wilmington-based Chemtex International a loan guarantee worth nearly $100 million.

Chemtex plans to build an ethanol plant in Sampson County that will convert high-energy grass varieties into ethanol. USDA Under Secretary for Rural Development Dallas Tonsager said this marks the culmination of a long process.

"They had to go through a very substantial process with us," said Tonsager.  "It took a few years to get through. Obviously, we have to have a feasible business plan.  They have to prove that their technology works.  They have to show us that it's going to be environmentally sound for the community."

The company is signing up hog farms to grow the grasses on spray fields, turning that land into a new cash crop for farmers. North Carolina is the nation's second largest hog producer behind Iowa.