NATCHEZ — KiOR company officials announced reaching a milestone Monday with the first shipments of cellulostic diesel from biofuels production facility in Columbus.

Achieving production at the Columbus facility — KiOR’s first commercial-scale plant — was a required benchmark to be reached before the company could begin work on its proposed Natchez facility, which is expected to create 320 direct and indirect jobs, company officials said.

“This is a major step forward for KiOR, the biofuels industry and the entire renewable fuels sector,” KiOR President and Chief Executive Officer Fred Cannon said. “With first production at Columbus, KiOR has technology with the potential to resurrect each and every shut down paper mill in the country and to replace imported oil on a cost effective basis while creating American jobs.

“We are proud to be making history in Mississippi. The technology is simply scalable, and we believe sufficient excess feedstock exists in the Southeast alone to build almost 50 KiOR commercial scale facilities.”

Natchez Inc. Chair Sue Stedman said Monday’s announcement was exciting news.

“We knew that any time you build a facility of that size, it takes a little while to get it cleared away, but we are thrilled they have finally gotten production under way, because that should signal the beginning of construction for us,” she said.

The Columbus facility is a smaller-scale version of what the company plans in Natchez, a cellulostic fuel plant that uses pine wood chips as feed stock.

The Columbus plant is a converted paper mill, which had been closed. In Natchez, the plant will be built from the ground up.

The announcement coincided with the company’s fourth quarter 2012 earnings call.

During the call, Cannon said commitments from important investors in the company have given Kior a “clear line of sight, depending on market conditions” that could mean starting construction of the Natchez facility in the second half of the year, and as the Columbus facility gains traction in its production, the company will continue to solicit investors for Natchez.

Cannon said the company will focus on achieving “steady state operations” in Columbus, and expects to produce between 3 and 5 million gallons for the year at that plant.

“We have learned a lot at Columbus over the last several months, and we believe we can apply the learnings from Columbus to the engineering and design of Natchez,” Cannon said.

Chief Financial Officer John Karnes said the company’s management believes that within 60 to 90 days of raising the funding, KiOR will be ready to break ground and move forward.

“Everything we’ve learned from Columbus has all been confirmatory,” Karnes said. “We have learned a lot, but it gives us more confidence on our ability to execute Natchez on time and on budget.

“After a quarter of production (in Columbus), we should have enough data for us to know more about utilization and more about yield and know exactly how to advance with Natchez.”

For the year, the company experienced a net loss of $96.4 million but saw its first revenues since startup — $87,000 related to the sale of blended cellulostic diesel from its research and development facility.

KiOR made $6 million in capital investments during the fourth quarter, which according to the company were primarily related to the Natchez project.

The Natchez facility will be built on the former Belwood golf course.

The Adams County Board of Supervisors have committed to building a levee estimated to cost $5 million to protect the property, which floods during high-water events.