Territory Biofuels signs MOU with Milio for feedstock, marketing
Lignol Energy Corp.’s subsidiary, Territory Biofuels Ltd., recently signed a formal memorandum of understanding with Milio International for the development of a joint venture through which Milio will fund up to 120,000 tons of feedstock per year and facilitate the marketing and sales of the production from Territory Biofuels’ 140 million liter per year (37 MMgy) biodiesel plant in Darwin, Australia. Lignol says at full production capacity this funding is expected to provide working capital funding of approximately $25 million.
Lignol reports Milio will receive 25 percent of the net profits earned on the sale of related production. Milio has agreed to assist in the restart of the Darwin plant with the funding of 1,500 tons of feedstock for an initial startup campaign, and up to 10,000 tons for an initial commercial campaign. Lignol says as additional consideration for this support, Milio will receive funds to cover Milio's costs and also the provision of $600,000 in shares of LEC or cash by mutual agreement.
“This joint venture will provide a creative and important funding mechanism for the working capital necessary to make the Darwin project robust and sustainable in the years to come,” said Ross MacLachlan, chairman and CEO of Lignol Energy Corp. “Milio has agreed to provide us with support at a critical juncture as we bring the Darwin plant back online. Having a partner as creative and motivated as Milio is already proving to be a tremendous asset, and we look forward to working together in seeking ways to optimize the profitability of our world-scale plant.”