Lignol Energy Corporation today announced the signing of a formal Memorandum of Understanding (MOU) between M Energy Co., Ltd. (M Energy) and LEC establishing the framework by which the two companies will work together to restart LEC's 140 million litre per year biodiesel plant and incorporate M Energy's proprietary pre-treatment technology.
The Parties have been in discussions regarding an investment structure which, if successful, would provide sufficient capital for the Darwin project and an opportunity for M Energy to become an equity partner in the project.
The two companies have collaborated over the past several months to develop a technology and commercial feasibility study on the integration of M Energy’s patented pre-treatment solution with the Company’s Lurgi designed, biodiesel plant located in Darwin Australia. This has involved physical inspections of both the Darwin plant and of M Energy’s operating pre-treatment plant in Korea. Samples of feedstocks for the Darwin plant have also been tested and verified to work with the M Energy pre-treatment technology. The scope of the collaboration also covers marketing rights to M Energy’s technology in Australia as well as commercial synergies in feedstock procurement, offtakes and sales of biodiesel to export markets.
The Darwin project involves the completion of certain Lurgi upgrades to ensure operability as well as routine replacement and refurbishment of certain existing components, followed by implementation of M Energy’s proprietary pre-treatment package, which will allow the plant to process a range of low-cost, sustainably certified high free fatty acid waste feedstocks. Biodiesel produced from certified waste feedstocks that meet quality specifications can be sold into certain markets around the world at a premium price; especially those markets which have established mandates for environmentally sustainable fuels.