VANCOUVER, Feb. 13, 2014 /CNW/ - Lignol Energy Corporation
(TSXV: LEC) ("LEC" or the "Company") today announced the signing of
a formal Memorandum of Understanding ("MOU") between Milio
International ("Milio") and LEC's subsidiary, Territory Biofuels
Limited ("TBF"), for the development of a joint venture ("JV").
Under the terms of the planned JV, it is anticipated that Milio
will fund up to 120,000 tons of feedstock per year as well as
facilitate the marketing and sales of the production from TBF's 140
million litre per year biodiesel plant located in Darwin,
Australia. At full
production capacity this funding is expected to provide working
capital funding of approximately US$25
million.
"This joint venture will provide a creative and
important funding mechanism for the working capital necessary to
make the Darwin project robust and sustainable in the years to
come", said Ross MacLachlan,
Chairman and CEO of Lignol Energy Corporation. "Milio has agreed to
provide us with support at a critical juncture as we bring the
Darwin plant back online. Having a partner as creative and
motivated as Milio is already proving to be a tremendous asset, and
we look forward to working together in seeking ways to optimize the
profitability of our world-scale plant."
At full production Milio will provide funding
for up to 120,000 tons of feedstock per year and will receive 25%
of the net profits earned on the sale of related production. In
addition, Milio has agreed to assist in the restart of the Darwin
plant with the funding of 1,500 tons of feedstock for an initial
startup campaign and up to 10,000 tons for an initial commercial
campaign. As additional consideration for this support, Milio will
receive funds sufficient to recover Milio's costs and also the
provision of $600,000 in shares of
LEC or cash by mutual agreement.
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
About Milio International ("Milio")
Milio International is a Commodity Trading and
Investment Company, specialising in upstream, midstream and
downstream fuel operations and infrastructure. Milio's upstream
capability encompasses the technical assessment, licensing,
exploration, development, management and commercialisation of
assets across the E&P sector, including those in Milio's own
portfolio. The company maintains strong, established relationships
with all the major oil producers, suppliers and refiners. The
company has a proven track record of directly purchasing crude at
the wellhead, valuing and marketing new crudes into the market and
structuring volume crude-product swaps. Milio sources and purchases
commercial and defence grade fuels from across the world and on
variety of Incoterms. Milio also offers complete commercial support
services through risk management, structured finance, insurance and
investment expertise. Further information is available at
www.milio.com.
About Territory Biofuels Limited
("TBF")
TBF owns a large-scale biorefining facility
located in Darwin, Northern Territory which includes a
Lurgi-designed biodiesel plant and the largest glycerine refinery
in Australia. The facility was
commissioned in 2008 at a cost of A$80
million, along with 38 million litres of related tankage,
now leased by TBF. The biodiesel plant is the largest in
Australia with a rated capacity of
140 million litres per year. The plant was originally built to run
on palm oil and food-grade vegetable oil, however the plant was
shut down in 2009 due to challenging technical and economic
conditions. TBF is in the process of raising funds to restart the
existing facility in the latter part of 2014 utilizing
environmentally certified, Refined Bleached & Deodorized (RBD)
palm oil. In 2015, TBF plans to integrate new feedstock
pre-treatment technologies and catalysts to process a broader range
of feedstocks such as lower quality tallow, used cooking oil and
palm sludge oil; a waste product from palm oil mill extraction.
About Lignol Energy Corporation
("LEC")
Lignol Energy Corporation is an emerging
producer of biofuels, biochemicals and renewable materials from
waste. LEC owns 100% of Lignol Innovations Ltd. ("LIL"), 100% of
Territory Biofuels Limited ("TBF"), 21% of Australian Renewable
Fuels Limited ("ARW"), 51% of Neutral Fuels (Melbourne) Pty Ltd ("Neutral Fuels Melbourne")
and 20% of Neutral Fuels Parent Company Ltd ("Neutral Fuels"). The
Company intends to invest in, or otherwise obtain, equity interests
in energy related projects, which have synergies with the Company
and have the potential to generate near term cash flow. Further
information is available on the Company's website at
www.lignol.ca.
Caution concerning forward-looking
statements:
Certain statements contained in this document
may constitute forward-looking information within the meaning of
applicable securities laws. Such forward-looking statements or
information include, without limitation, statements or information
about LEC's and TBF's ability to finance, restart and profitably
operate its 140 million litre per year biodiesel plant and
glycerine refinery. Often, but not always, forward looking
statements or information can be identified by the use of words
such as "plans", "expects" or "does not expect", "is expected",
"budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates" or "does not anticipate", or "believes" or variations
of such words and phrases or words and phrases that state or
indicate that certain actions, events or results "may", "could",
"would", "might" or "will" be taken, occur or be achieved.
Such statements or information reflect LEC's
current views with respect to future events and are subject to
certain risks, uncertainties and assumptions including, without
limitation, TBF and Milio's ability to conclude and to enter into
definitive agreements with respect to the formation and operation
of a joint venture, TBF and Milio's ability to secure the supply of
suitable feedstock to be funded by Milio, TBF's ability to process
such feedstock and for Milio to facilitate the marketing and sales
of the production from the Darwin plant, LEC's ability to raise
additional capital to fund operations and to support the capital
requirements of its affiliates, TBF may in the future issue shares
in connection with the raising of capital or the repayment of debt
or other obligations, which could result in LEC owning less than
100% of TBF, TBF's ability to successfully operate the Darwin
facility commencing in the latter part of 2014 and to generate
revenues and cash flow, TBF's ability to integrate new pretreatment
technologies and catalysts to facilitate the processing of a broad
range of lower cost feedstocks, LEC's ability to continue as a
going concern and to raise additional finance to fund the
operations of LEC and its affiliates and LEC's planned investment
in Neutral Fuels, Neutral Fuels and Neutral Fuels Melbourne's
ability to maintain a profitable working relationship with
McDonald's restaurants, LEC's ability to invest in, or otherwise
obtain, equity interests in energy related projects which have
technical and commercial synergies with the Company and which have
the potential to generate future dividends and near term cash flow,
the requirements of the potential effect of changes in government
policy relating to the environment, and incentives for renewable
fuels, the potential impact of changes in the prices of feedstock
and the market price of liquid fuels including biodiesel, ethanol
and renewable chemicals, the ability of LEC and its affiliates to
generate future profits and to pay dividends, and to meet
increasing regulatory requirements, LIL's ability to finance and
complete the development of a commercial project, LIL's ability to
develop products and to obtain off-take agreements, LEC's reliance
on publically available information of ARW in its evaluation of its
acquisition of shares in ARW, the potential inability to divest the
ARW ordinary shares due to modest trading volumes, the potential
inability to divest the ordinary shares LEC owns of TBF, the
ability of ARW and Neutral Fuels to market their products and to
meet relevant regulatory requirements, the estimated cost of any
future TBF capital investment, the fluctuation of biodiesel and
feedstock prices, and the effect of changes in government policy
relating to the environment.
Many factors could cause LEC's actual
results, performance or achievements to be materially different
from any future results, performance or achievements that may be
expressed or implied by such forward looking statements or
information, including among other things, financial market
conditions which will impact LEC's ability to finance its
operations and to meet future capital and investment requirements,
the demand for the market price of liquid fuels including gasoline,
biodiesel, ethanol, the market price and demand for renewable
chemicals, risks relating to the protection of technology from
infringement and those risk factors which are discussed elsewhere
in documents that LEC files from time to time with securities and
other regulatory authorities. Should one or more of these risks or
uncertainties materialize, or should assumptions underlying the
forward-looking statements or information prove incorrect, actual
results may vary materially from those described herein as
intended, planned, anticipated, believed, estimated or expected.
Except as required by law, LEC expressly disclaims any intention or
obligation to update or revise any forward looking statements and
information whether as a result of new information, future events
or otherwise. All written and oral forward-looking statements and
information attributable to us or persons acting on our behalf are
expressly qualified in their entirety by the foregoing cautionary
statements.
SOURCE Lignol Energy Corporation