TEG.L Regulatory News (TEG)

The TEG GROUP PLC (TEG/L)

("TEG" or "the Company")

TEG Concludes Contract for

Food Waste with May Gurney

The TEG Group Plc, the AIM-listed cutting edge green technology company, which develops and operates organic composting and energy plants, is pleased to announce that its subsidiary TEG Environmental Limited has concluded a contract with May Gurney Integrated Services plc ("May Gurney") to process food waste collected by May Gurney under its Bridgend Council contract. It is intended that the food waste will be processed at the facility under development by TEG at Stormy Down near Bridgend. Until that plant is constructed, TEG will sub-contract the services within its network of plants and third party facilities. 

The contract commenced on 14 June 2010, is for an initial 3-year period and will generate estimated revenues of approximately £500,000 - £800,000 over the contract lifetime, depending upon the rate of waste arisings.

The Stormy Down development, a collaboration to develop a co-located anaerobic digestion ("AD") and in-vessel composting ("IVC") facility, was announced by the Company on 12 October 2009. The site currently benefits from planning permission for an AD plant and TEG has recently been granted planning approval to construct a TEG Silo Cage IVC plant. It is intended that construction at the facility will commence in 2010 and will ultimately provide up to 70,000 tonnes per annum of organic waste treatment capacity.

Commenting for TEG, Chief Executive Mick Fishwick said:"We are delighted to have been awarded the food waste contract by May Gurney and to be providing a service locally in Bridgend. The contract will provide the first waste stream and revenues into the Stormy Down facility and with the high level of market interest in Wales, we are confident of significant further contract wins in 2010 and beyond."

Nicola Peake, Managing Director at May Gurney Environmental Services said: "One of May Gurney's core skills is to bring together the best expertise and resources to deliver transformational front-line services for clients. Food waste processing is a key element in the new collection and recycling services we've introduced for Bridgend residents and TEG is the leader in its field."

ENDS

Editor's Notes:

TEG

TEG provides an in-vessel composting technology, which is one of the few approved technologies capable of treating animal by-product (ABP) waste, and is now providing an anaerobic digestion (AD) technology to produce power from food waste. Plant economics are predominantly driven by the gate fees charged, rather than the value of the end product (compost). The AD plants also benefit from power sales and Renewable Obligations Certificates ("ROCS") or Feed-in Tariffs ("FITs"). TEG owns its composting technology and has an agreement with UTS Biogastechnik GmbH ("UTS") for the provision of AD technology into the UK waste markets. The TEG processes are an economic alternative to landfill.

The TEG Silo Cage System

The Silo Cage system, one of the few technologies in Europe capable of treating this waste, is a natural process producing compost as an end product. The compost is an excellent soil conditioner that fertilises, retains moisture, provides structure and reduces the incidence of plant disease. TEG's Silo-Cages are housed in self-contained buildings, are not unsightly and are environmentally friendly.

Collaboration with UTS

Having supplied equipment to more than 1,500 equipped biogas plants, UTS Biogastechnik GmbH is one of the world's leading biogas companies. The UTS group of companies offers services in the planning, construction, delivery and installation of biogas plants and their key components. The company has its own production facilities and service shops, technical design and development departments as well as mobile mechanical and biological customer service technicians to support the international client base. UTS also develops and sells specialized mixers, pumps and a variety of solid/liquid separating devices related to the biogas and agro/food markets. The company is headquartered near Munich, Germany with subsidiaries in Italy, Hungary, Spain, the Czech Republic and now a rapidly developing company UTS Biogas Limited. to service the United Kingdom & Ireland markets.

General

Customers include local authorities, waste management companies, food processors, farmers and landowners. The Company's expanding market is driven by increasingly stringent EU and UK legislation regulating the treatment and disposal of organic waste. Statutory targets for the diversion of waste from landfill increase annually through to 2020, increasing TEG's market opportunity year on year. 

The Natural Organic Fertiliser Company Limited ("NOFCO"), a subsidiary of TEG, is a marketing company specialising in the development of end markets for compost products, an important aspect of all plant developments and key to local authority development. The company has an expertise in the development of agricultural and horticultural markets and this capability is provided to customers to enhance TEG's overall service offering.