HUN.L Regulatory News (HUN)

14 Feb 2008 07:01

GEM BioFuels Plc14 February 2008 14 February 2008 AIM: GBF GEM BioFuels Signs Offtake Agreement GEM BioFuels Plc ("GEM" or the "Company") (AIM: GBF), a company established tosupply feedstock to the rapidly growing global biodiesel market, is pleased toannounce that it has signed a long-term Off-take Agreement (the "Agreement")with Natural Fuel Limited ("NFL"), under which GEM will supply NFL with crudeJatropha oil as feedstock for its Singapore biodiesel facility. Under the terms of the Agreement, for which a letter of intent was signed andannounced by NFL in October 2007, GEM will supply 55% of its crude Jatropha oilproduction in Madagascar to NFL. The Agreement is for a 10 year period, startingin January 2009, at a free on board delivery price of US$500 per tonne, adjustedfor inflation, for the first 5 years. NFL, which is listed on Australian StockExchange, is developing biodiesel refining facilities with production capacityin excess of 700,000 tonnes per annum (t.p.a.). GEM also announces the conclusion of its 2007/2008 planting season during whichmore than 30,000 hectares of further plantations have been established. TheCompany believes that, had sufficient seed been available, it would have beenable to achieve the plantation levels indicated in its October 2007 AdmissionDocument. The Company expects to have sufficient seed available in 2009 toachieve its programmed plantation work in this year. GEM expects to producearound 20,000 tonnes of crude Jatropha oil by 2009. Paul Benetti, CEO of GEM BioFuels commented: "We are pleased to have signed thisagreement with NFL which cements a constant demand for the term of the Agreementand highlights the incentive for purchasers of Jatropha oil in securing thesupply of biodiesel feedstocks at agreed prices, an agreement which benefitsboth the purchaser and supplier therein." For further information, please contact: GEM BioFuels PLC Paul Benetti + 61 (0) 40 7039 379WH Ireland Limited Tim Cofman-Nicoresti / Nicola Rayner + 44 (0) 121 616 2101Parkgreen Communications Justine Howarth / Louise Goodeve + 44 (0) 20 7851 7480 NOTES TO EDITORS About GEM BioFuels GEM BioFuels was founded in 2004 to capitalise on the opportunity presented bythe local agricultural and socio-economic conditions in Madagascar to produceJatropha oil for use as a biodiesel feedstock. Operations are based in the Southof the island where the Jatropha tree grows wild. The Company has secured 50 year agreements giving exclusive rights over 452,500hectares (in excess of 1 million acres) to establish plantations, ranging insize from 2,500 - 50,000 hectares with a further 40,000 hectares of naturalforest containing substantial numbers of mature Jatropha trees. To date the Company has planted 43,500 hectares of Jatropha and a total of200,000 hectares is expected to be planted by 2010. Based on this, the Group'sproduction is expected to be 20,000 t.p.a. of crude Jatropha oil in 2009 risingto 210,000 t.p.a. in 2014, after its trees mature. GEM BioFuels Plc was admitted to trading on AIM in October 2007. Jatropha Jatropha is a small tree/shrub, growing to about 5 metres in height and is wellsuited for use in the production of biodiesel. Jatropha trees are relativelydrought resistant and suitable for cultivation in sub tropical regions. Thehigh oil yielding seeds are mildly toxic and as such Jatropha is not a food andits use in biodiesel production does not affect the cost of living of theindigenous population. Biodiesel refined from Jatropha oil complies withinternational standards, including EN14214 in Europe, the major market forbiodiesel. Whilst the current production of Jatropha seed for commercial purposes is small,it is substantially increasing due to its attractiveness as a biodieselfeedstock because of its ability to grow on marginal land and the fact that itis non-edible. This information is provided by RNS The company news service from the London Stock Exchange