Boston Beer’s Brewery Costs Rise

The potential costs of building a Massachusetts brewery have continued to increase for The Boston Beer Co., and the company now says it probably won’t make a final decision about the project until the summer.

The company said that it expects a new brewery that could produce 1 million barrels of beer a year would cost $170 million to $210 million. That’s a significant increase from the $120 million to $160 million range that the company provided last August when it signed a purchase and sale agreement for 50 acres in Freetown, Massachusetts south of Boston.

Boston Beer, in its latest quarterly earnings release, said that its evaluation of the site will be completed by ”midyear 2007.” The dollar figure provided includes land acquisition, development, equipment and other startup costs. If the company builds the plant, it would employ 75 to 100 people there.

Boston Beer brews most of its beer at its brewery in Cincinnati. The company also has brewing contracts with three outside plants, but one of those arrangements – a contract with a Miller Brewing plant in North Carolina – is set to expire in October 2008.

Michelle Sullivan, a spokeswoman for Boston Beer, said the company is also continuing to evaluate other options that include expansions of its two existing breweries, possibly buying another brewery, or relying on other brewing contracts. She said a final solution to the company’s brewing needs may include more than one option.

”Everything is on the table,” Sullivan said. ”Ultimately, what’s likely to happen is a combination of these things and not just one.”