RenuEn announces biobased CNG purchase agreement
RenuEn Corp., a renewable energy development company, has announced the signing of a significant five-year agreement to purchase 3,750,000 gas gallon equivalent (GGE) from its St. Cloud compressed natural gas (CNG) facility.
Don Wood, CEO of RenuEn, stated, "Today I can finally announce a long awaited contract to purchase CNG from our soon to be completed St. Cloud landfill project. Our [executive vice president], J. Charles Nemes, has diligently negotiated this agreement for nearly three months and as a result of his efforts, we have now sold out a majority of the facility's natural production for the next five years. The contract, and accompanying promissory note, has a total value of $7,500,000 over the five year term."
Wood added, "Phase one of our designed facility is capable of producing approximately 62,500 GGE per month, or 750,000 GGE per year and this purchase agreement will account for 100 percent of the production from the first phase of the project. In phase two, which is currently in development, we will be adding a connection to a natural gas pipeline that runs parallel to the St. Cloud facility allowing us to mix natural gas with our renewable landfill gas. We will have the capability to blend 20 percent landfill gas with 80 percent natural gas, allowing us to increase our yearly production to over 3,000,000 GGE per year and still meet the federal government criteria of renewable gas."
Nemes has been working in collaboration with Elliot Kahana, senior consultant with KFV-LLC, a Florida based consulting firm and Wolfgang R. Geyer of Mocker & Co, Consult, Gmbh, a Stuttgart, Germany based consulting firm specializing in business development, vonsulting, investment, asset management, project management, technology transfer, renewable energy, raw materials and commodities. Nemes commented on the joint effort by saying, "Through this collaborative effort, we have entered into a five year gas purchase agreement with Al-Gahry Trading, a Dubai UAE based exporting firm to be used for their U.S. based trucking firms. This agreement will now facilitate the collaboration of a joint effort with RenuEn to bring MBM Brand CNG trucks and engines to the United States for use by many of the largest and respected trucking companies. As more and more trucking companies convert to CNG technology, RenuEn, through our international relationship with Mocker and Al Gahry, will be positioned to offer expanded CNG services to all of our clients. MBM trucks use German designed and engineered technology and they are capable of supplying CNG trucks and engines that meet full US specifications."
In an email to Mr. Nemes, Isam A. Osman, CEO of Al Gahry, wrote, "I am looking forward to a fruitful common business relationship with RenuEn."
CEO Don Wood concluded, "This off take agreement, and the relationship we have now forged, is the most significant component of our business plan. While we always expected to sell our gas after construction, this contract has now solidified our ability to generate revenue from the St. Cloud facility, pay down debt and continue with our overall plan to organically grow the RenuEn brand and bring added value to our shareholders. Our last achievement for completing the long awaited construction of the facility will be the approval from the City of St. Cloud for a short-term extension of the construction schedule. We anticipate that the City of St. Cloud will recognize the significance of this project, the financial benefit to the City, the international relationships we have established and the efforts put forth by Team Energy, RenuEn, the University of Central Florida and the staff of the City of St. Cloud. We are scheduled to appear at the next St. Cloud Council Meeting on Sept. 12, 2013."