In South Dakota, KL Energy and Petrobras announced that they have entered into a Joint Development Agreement to jointly optimize KLE’s proprietary cellulosic ethanol process technology for sugarcane bagasse feedstock. As part of this agreement, The companies also said that they will develop a 4 Mgy bagasse-based cellulosic ethanol project that will be co-located with a Petrobras-owned sugarcane mill, which will come online in 2013.
In addition, Petrobras will provide $11 million to adapt KLE’s demonstration facility to the use of bagasse, validate the optimized process by producing cellulosic ethanol and lignin and license the validated technology.
The agreement has an initial term of 18 months and provides for mutual exclusivity in the area of developing cellulosic ethanol from bagasse. The latest generation of KLE’s process design provides for substantial enhancements over the first generation, implemented in 2008 at the company’s demonstration plant in Upton, Wyoming using Ponderosa Pine feedstock, including the ability to be optimized for multiple feedstocks.
KL Energy first annoucned that it was aiming to expand its cellulosic ethanol technology to Brazil and take on the problem of bagasse conversion, in April 2009, here.
KL’s recent S-1 registration
The company recently filed a S-1 registration for a fresh equity offering. In the S-1, the company said “as of the date of this report, approximately 83% ownership of KLEG stock is concentrated in 9 individuals and entities (including approximately 10% of outstanding common stock owned by current KLE management.) Since the Merger, less than 600 shares (out of over 47 million shares outstanding) have been traded.
Because its stock is thinly traded, the Company does not believe that these quotations, particularly at December 31, 2009, are indicative of the market value of the business. Recent private placement transactions by the Company have been at $1.10 per share.”
The $1.10 price would indicate a $51.86 million valuation for the comapny. The company also identified its strategic focus on “Developing and supplying the technologies for commercial application to produce cellulosic ethanol from wood waste or other feedstocks; Owning and operating its own cellulosic bioenergy facilities; Developing national and international strategic partnerships and strategic alliances; and improving existing ethanol production through KL Capacity, its engineering service for advanced biofuels.
KL Energy Background
KL Energy becomes first advanced biofuels producer to win approval under Biomass Crop Assistance Program
KL Energy, Fair Energy sign cellulosic ethanol off-take deal for US, Europe