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O2Diesel to Acquire Ethanol Producer Building 100 Million Gallon Plant

18 January 2007

O2Diesel Corporation, a developer of ethanol-diesel fuel blends, has entered into a definitive purchase agreement to acquire 80% of ProEco Energy Company, Inc., a privately held company that is developing an ethanol production facility in South Dakota with planned capacity of 100 million gallons per year. O2Diesel expects the acquisition to close during the second quarter of 2007.

Completion date for the first of two 50 million gallon production trains will be twelve months following project commencement. The second 50 million gallon train is scheduled for development and completion in 2008.

The acquisition will expand O2Diesel’s strategy of developing new markets for its ethanol-diesel blended fuel in the US. O2Diesel says that the consolidated company will expand and diversify its revenues, while providing stable and competitive pricing for ethanol supply for the production of O2Diesel for centrally fueled fleets.

By controlling ethanol supply at a competitive price, O2Diesel can offer its proprietary fuel blend at a price lower than regular diesel fuel, leveraging this advantage to gain further market share.

The definitive agreement requires ProEco Energy to complete a number of steps toward completion of the ethanol plant project in order for the closing of the share exchange to occur. At the time of the closing, ProEco Energy must have entered into a definitive engineering, procurement and construction contract with a reputable firm with extensive experience in implementing and completing projects similar to the ethanol plant project and executed marketing agreements for the sale of the production of the ethanol plant.

As a condition to the closing of the ProEco share exchange, O2Diesel is obligated to secure the financing necessary to complete the construction costs to build the ethanol plant. Accordingly, O2Diesel anticipates raising between $120 to $140 million in debt and between $60 to $80 million in equity in two tranches in 2007.

O2Diesel is also developing fuel blends with ethanol and biodiesel components as well as its ethanol-diesel mainstay. (Earlier post.)

January 18, 2007 in Diesel, Ethanol | Permalink | Comments (4) | TrackBack (0)

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Comments

Someone in another chat-hall asked me to explain where we are going with, "alternative energy".

This caused me to detach from our current discussions and to ponder for awhile.

I think we will see a good bit more thrashing about and many paths being taken. I really doubt that H2 and fuel cells - barring a major breakthrough - will become a significant source of energy for transportation or stationary power generation. Alcohol has some potential, but to realize it, engines will have to be developed that can extract the maximum efficiency from it.

At this moment in time, I really feel that Biodiesel has the most promise. Mixing it with alcohol as in the O2 process offers many benefits and may well become the most promising fuel of the future. A big plus is it can be transported and distributed by our existing infrastructure.

I would like to see those in the Genetic Modification (GM) business adapt existing plants to have some of the best characteristics of each of several plants. It would be really great to see, cold weather and salt tolerant plants that are capable of growing four harvests a year, and that add to the fertility of the soil. (like switchgrass) That don't have to be tilled and produce feedstock that can be processed into both diesel and alcohol (like corn)in a continuous process. The residual can be used to power the processing plant, much as it is done in Brazil's alcohol plants today.

Lucas,
_Fuel cells do not end with PEMs that use H2. SOFC and MCFC are two that can use carbon and hydrogen. Both can be scaled up as large stationary and mobile power supplies (ships, powerplants, locomotives).
_In addition to sugar cane, other C4 grasses (sweet sorghum), tubers (sweet potatoes), and weeds (tobacco) are prime candidates.

Depending on where the fuel is made should determine the type of fuel. There doesn’t have to be one cure. Ethanol Bio diesel, from corn or cellulosic, garbage or orange peels
Just make a lot of it and have a standard so autos can use it. I don’t think we in the USA
Will produce enough until Bush is out of office. Just today on read in MSNBC that congress is trying to get some of the money bush gave away in tax credits and so fourth
15 Billion dollars htp://www.msnbc.msn.com/id/16691568/
They stated most of this money will go to renewable fuels

From the oil companys

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