Atlantec BioEnergy says it hasn't ruled out Prince Edward Island as a location for an $85-million ethanol plant, despite suggestions this week it will be built in Nova Scotia.

Atlantec BioEnergy spokesman Ron Coles says no decision has been made on where the ethanol plant will go. (CBC)

On Thursday, the company said it is one of several companies in discussions with bankruptcy trustees about buying the TrentonWorks plant in Trenton, but company spokesman Ron Coles told CBC News Friday that initiative is far from a done deal.

Coles said the company is still in talks with the P.E.I. government about setting up the plant here.

"We're still working with the province of P.E.I. going through their committee process and they're doing their due diligence on their future for biofuels," he said.

"At the same point in time we're working on another siting, which happens to be Nova Scotia. We'll continue the process with P.E.I. and see what they have down the road.

Atlantec wants P.E.I. to pass provincial legislation mandating a minimum ethanol level of 10 per cent for fuel sold in this province. Coles said the company will ask Nova Scotia to pass a similar law if Nova Scotia is ultimately chosen as a site.

While the site for the plant is not confirmed, the company is trying to convince farmers in Nova Scotia to produce about 6,100 hectares of sugar beets, which would be used as the source of ethanol in the plant.

One P.E.I. farmer is already growing 30 hectares of sugar beets in a test plot for the company.