Lignol signs agreement with Australian biofuels firm
March 11, 2013
March 11, 2013 Vancouver, BC – Lignol Energy Corporation announced that it had made an investment in and signed a agreement to collaborate with Australia’s Territory Biofuels Limited.
Lignol has subscribed for convertible notes with a principal value of A$1.18 million issued by Territory Biofuels and signed a Technology Collaboration Agreement that includes a package of technical and further assistance to aid in the restart of Territory Biofuels’ 150 million litre per year biodiesel plant and glycerine refinery located in Darwin, Australia.
"We are proud to be working with TBF on this important, large scale project", said Ross MacLachlan, Chairman and CEO of Lignol Energy. "The Darwin plant is an impressive industrial facility and the TBF team has developed a compelling business model with strong commercial partnerships with which to become a major regional player in the biodiesel market in the Pacific Rim. This transaction reinforces the commitment to our strategy of selective investments in energy related projects which have synergies with our Company and have the potential to generate near term cash flow."
The terms of the Notes provide for conversion into an equity position for LEC of between 20% to 40% in TBF, depending on a range of criteria related to the development of the Darwin facility. This investment will be funded, in part, from Lignol's recently announced line of credit with its major shareholder, Difference Capital Funding Ltd. The terms of the Technology Collaboration Agreement provide for technical assistance from Lignol and its partners with respect to both the restart of the facility and the potential integration of new pretreatment technologies and catalysts to facilitate the processing of a broad range of low cost feedstocks.
"Lignol's financial investment and support from its partners is an important step in the restart of our world class facility", said Chris Hart, Chairman of Territory Biofuels. "Having toured the Lignol facilities and met with their scientists, engineers and partners, I am also confident that our new technology collaboration will assist in an efficient recommissioning of our project and lead to the implementation of advanced technologies that maximize plant performance."
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