Vega Promotional Systems has entered into a joint venture (JV) agreement with Global Capital Market (GCM) to build multiple manufacturing plants throughout China to produce alternative energy using torrefaction technology.
The firm’s JV with GCM is moving forward with its plan to build up to 10 manufacturing plants throughout China. The manufacturing plants will use special torrefaction technology to produce briquettes from organic waste products that will then be sold through agreements with European power generating companies.
Torrefaction is a partial carbonization process that takes place at temperatures between 475 – 575 degrees in a low temperature environment which makes physical and energetic properties of the biomass more comparable to traditional coal. The biomass is then compressed into briquettes to be sold to the end user. Torrefaction has the added benefit of reducing or eliminating undesirable volatiles, such as nitrous oxides and sulfur dioxides and is considered carbon neutral to the environment.
By accounting for positive environmental impact of not allowing biomass to decay and providing a positive impact through renewable energy under an approved methodology from the Clean Development Mechanism (CDM) under the United Nations Framework Convention on Climate Change (UNFCCC), the production and sale of carbon credits from the burning of biomass for CO2 production will guarantee additional income to the JV.
The target markets for the company’s products are power plants that face mandates to increase biomass usage in their coal burning plants. Firing in existing coal plants will not require any retrofitting of existing power plants.
GCM is providing the land for the manufacturing facilities, the factories, and the necessary biomass resources to produce 100,000 metric tons of torrefaction pellets annually in each plant, generating approximately $14m in annual revenue, per location.
Vega is currently in discussions with various funding sources to help fund the company’s participation in the project. In addition, the company is planning a private placement of its securities that would include the sale of restricted stock.
Michael Molen, chairman of Vega, said: “We have had significant interest from all over the world to participate in this venture. This is a very progressive project and if we reach our goals, we will become one of the largest biomass manufacturing companies in China. We will have engineers traveling to China during the month of January and look forward to providing additional details of the project at that time.”
In addition to China, Vega now has active projects under way in Western Indiana, South Georgia and Brazil.