Graphene Nanochem Regulatory News (GRPH)

30 Jul 2007 10:27

Biofutures International plc30 July 2007 For Immediate Release 30 July 2007 Biofutures International plc Annual General Meeting Trading Statement Biofutures International plc ("the Company"), a company established to invest inor acquire assets, businesses or companies in the renewable fuels industry,located in Asia and Europe, announces the following trading update, which willbe presented at the Company's AGM being held today at 11am at 3 Noble Street,London: The main feature affecting our business during the period since re-Admission hasbeen the behaviour of vegetable oil prices and specifically the price of crudepalm oil. Since October 2006, the price has increased from US$430 per metrictonne to around $750 per tonne today. In June the price peaked at over $850 pertonne. We believe that there are a number of reasons for the high price whichinclude seasonal climate effects and some speculative activity in trading of thecommodity. However, the fundamental macroeconomic driver of increased prices isrising global food demand. The increased use of corn to produce ethanol as abiofuel in the United States may also be having an effect on the availability ofvegetable oil supplies. The company has progressed with the business in three important areas since ourre-admission to trading in AIM in October 2006. Firstly, we have pursued thesenior debt required to fund the development of the biodiesel project in LahadDatu. We stated at the time of our admission, that we would not commit toexpenditure beyond our cash resources until sufficient bank funding was in placeand the Company upholds that commitment. The increased price of palm oil ismaking it difficult to secure the senior debt we require to run the project onterms acceptable to the Board. At the prevailing prices, it would not bepossible to operate the plant profitably. The work on raising debt has thereforetaken longer than originally envisaged Secondly, we have developed the project itself as far as possible, whilstlimiting the commitment of shareholders' funds in the absence of senior debt.Specifically, this has included progression of the contract with Lurgi for thesupply of biodiesel components to the plant, the development of a detaileddesign for the plant and site, and tendering for a main contractor to constructthe plant. This work is almost complete. Thirdly, we have progressed detailed discussions with both feed stock providersfor the supply of crude palm oil, and with off takers on sales contracts for ourbiodiesel and glycerine products. These discussions have progressed well and weare in a position to finalise these arrangements, though these will only befinalised once senior debt has been secured. We remain in discussion with banks regarding senior debt. Meanwhile the Board isalso assessing the current palm oil price behaviour and the implications thishas for the future. The Board will not sanction progress of the project toexecution if it feels the economics of the business will be unfavourable overthe long term. The Board is considering options for the business to maximiseshareholder value in the event that no debt offer is forthcoming. For further information: Nicholas GeeBiofutures International plc 0207 4665000 Joseph MarffyRuegg & Co Limited 0207 584 3663 Buchanan CommunicationsIsabel Hodges 0207 466 5000 This information is provided by RNS The company news service from the London Stock Exchange