Canada-based advanced biofuels and renewable chemicals company Lignol Energy has completed the previously announced credit facility of up to $5m with its shareholder Difference Capital Funding.

The company had earlier announced plans to undertake a share transaction and rights offering for stake in Australian Renewable Fuels (ARW); the transaction is expected to make Lignol Energy one of the largest shareholders in ARW.

Lignol Energy president and CEO Ross MacLachlan commented that this credit facility from Difference Capital Funding provides flexibility to the company’s financial planning to take advantage of strategic opportunities.

"The support from DCF as one of our major shareholders is very encouraging and reinforces LEC’s commitment to its strategy of taking significant equity stakes in companies such as ARW," MacLachlan added.

Australian biodiesel producer ARW operates three plants with a combined geeneration capacity of 150 million litres a year, and has recently announced its intention to raise A$12.3m ($12.63m) in cash.

Lignol Energy develops biorefining technologies for the production of advanced biofuels, biochemicals and biomaterials from non-food cellulosic biomass feed stocks.