Anaerobic Digestion Agreement

30 Apr 2008 07:00

Bioganix PLC30 April 2008 April 30th 2008 BIOGANIX PLC Anaerobic Digestion Strategic Alliance Bioganix plc ('Bioganix' or 'the Group'), the AIM listed waste managementservices group, is pleased to announce that the Bioganix directors have enteredinto an agreement with Kompogas AG ("Kompogas"), a Swiss-based manufacturer ofanaerobic digestion systems, and Kuttner GmbH ("Kuttner"), a German engineeringcontractor, for the production of renewable energy from waste. The objective ofthe agreement is for all three parties to jointly develop the UKAD market placeusing a combination of each of the parties' skills and expertise. Anaerobic Digestion Anaerobic Digestion is the process whereby biodegradable material is broken downin the absence of oxygen inside an enclosed vessel by micro organisms. Theprocess results in the generation of methane, carbon-dioxide (CO2) and othergases. The process also generates solid and liquid residues known as digestate.AD plants designed to produce gas for electricity generation have been operatingin Continental Europe and elsewhere for many years. UK uptake of AD technologyhas historically been limited. The recent concerns over both waste disposal andthe desire to produce "green" electricity and heat have given rise to renewedinterest in AD technology in the UK. The UK Government is highly supportive ofthe development of AD facilities. New grant schemes for AD have recently beenannounced by DEFRA in addition to the recent Government announcement that energyproduced from anaerobic digestion of waste is most likely going to be eligiblefor double Renewable Obligation Certificates ("ROC"s) in the near future. Kompogas http://www.kompogas.ch/index.php?id=13&L=1 Kompogas has been active in the AD sector since the early 1980s. The company, inconjunction with its partner companies, has built over fifty AD plants worldwidewith the majority in Switzerland and Germany. Kompogas is also the operator ofmany of these plants. The proven plug-flow, thermophilic, dry digestiontechnology ensures high gas yields, reliable operation and a high qualityend-product digestate. Gas from plants is used in a number of applicationsincluding: • Generation and sale of electricity using gas engines; • Export to the Gas Grid for domestic and commercial use; • Use as a road fuel in specially converted vehicles. Kompogas plants from the outside resemble typical industrial premises. Allprocessing activities take place inside a sealed building with sophisticatedodour management techniques in place. A typical 30,000 tonnes per year plantwill have a footprint of approximately 1.5 Ha. with a processing building sitedthereon of approximately 4,000 square metres. Electrical and heat power outputfrom such a plant is used to power the AD process and make available a typicalsurplus output of 7 Mw hours of electricity per year for sale and export to theElectricity Grid and 6 Mw hours of heat per year for export to other users. Axpo, a leading Swiss electric power producer, holds a 49 % stake in Kompogas. Kuttner http://www.kuettner.de/e-home.html Kuttner is a German engineering contractor, which has experience of installingKompogas AD plants. Kuttner is based in Essen in Germany and has operatingdivisions in approximately 12 countries worldwide. The company employs about 260people and in 2007 had sales of €85 million. Kuttner has recently entered into alicensing agreement with Kompogas for the design and construction of Kompogasbased facilities in the United Kingdom and Ireland. UK Business Plan In conjunction with Kuttner, Bioganix intends to build, own and operate KompogasAD plants in the UK fed by a variety of waste streams similar to those alreadyprocessed by Bioganix in the Group's existing composting facilities. Bioganix sees significant synergies between the Bioganix and Kompogastechnologies, both from operational and technical perspectives. Kompogastechnology is likely to be combined with some elements of the Bioganix IVC(in-vessel composting) and associated processes, depending on waste streams andrequirements. Under the terms of the agreement Bioganix has been granted thefirst option of offering service provision using Kompogas technology withrespect to any public tenders or enquiries received by Kuttner or Kompogas, forwaste recycling or AD facilities within the UK. UK-based Bioganix/Kompogas plants, like their overseas equivalents, are likelyto be sited on industrial land near to large centres of population and foodmanufacturing activity. Access to farm land will be important for digestatedisposal as fertiliser. Bioganix Managing Director, Nick Helme commented: "We see this as a major opportunity for both Bioganix and Kompogas. The abilityto leverage our technical development skills and knowledge of the organic wasterecycling industry in UK to launch the Kompogas technology gives the jointventure a significant head start. To combine the Bioganix process with atechnology that is able to generate renewable energy is an important progressionfor us. "We are obviously delighted that a large and experienced builder and operator ofwaste recycling plants within Europe has recognised the similar skills andtechnology of Bioganix and selected us to be their partner to develop the UKmarket for recycling and renewable energy." Contacts: Nick Helme 01568 619115Managing Director - Bioganix Plc Julian Morgan 01568 619101Finance and Commercial Director - Bioganix Plc Mike Coe 0117 933 0020Blue Oar Securities Plc Tom Cooper / Paul Vann 020 3043 4162Winningtons 0797 122 1972 This information is provided by RNS The company news service from the London Stock Exchange