Flex Fuels Considers Cardiff Plant Options

The company said it will announce its decision on the preferred EPC contractor later this month.

The company said that demand is high and expected to remain so for both premium-value rape oil for use in the food processing industry, and for sustainably produced rape meal for supply to producers of livestock feed.

With these strong prevailing market conditions matched to an available feedstock supply, management is confident that the oilseed processing plant could be operated as a stand-alone unit pending greater clarity in the biofuels market.

Rigorous carbon and sustainability standards will be applied to all oil-seed rape (OSR) feedstock, the raw material for the plant, to ensure class-leading performance under the carbon score calculator, which is an integral element of the Renewable Transport Fuels Obligation (RTFO).

The precise timing of construction of a biodiesel plant at the site, is being kept under close review by the Company due to influential developments in its markets, notably the publication of the Gallagher Review on the Indirect Effects of Biofuels Production (July 2008), and the continuing, so-called splash and dash export credits operating in the US – subsidies which, in the view of the Company, artificially distort the market for biodiesel.

Management of the Company, which collectively has substantial experience in the energy, renewables, construction and agricultural sectors, anticipates that after 2010 more certainty is likely to emerge in the market for biofuels in the UK and Europe, and that sustainable, carbon-reducing biofuels will be increasingly accepted for their essential role in the future of road transport.

Flex Fuels Energy said it is confident of the strength of its business model in any currently foreseeable circumstances, as its commitment to carbon efficiency and sustainability is based on the use of predominantly locally produced feedstock, from fully traceable sources, processed in an integrated plant, operating from a single site, using shared energy and resource facilities.

Brian Barrows, Chief Executive of Flex Fuels Energy, said: "It is most encouraging that a number of blue-chip technology providers have responded to our tender process with high-quality submissions. Their response affirms the strength both of the overall opportunity and of our strategy for fulfilling it."

Graham Hilton, Non-Executive Director of Flex Fuels Energy, said: "I am pleased that the Company will be able to push ahead with such high-quality partners in the development of the Cardiff facility. This project will help to underpin a truly sustainable and efficient supply chain in the South-West of the UK whether the oil is used for food or fuel."

Mr Hilton, who in separate roles is Chair of the Environmental Industries Commission Road Transport Fuels Group and a member of a number of renewable industry groups, added: "The development of the integrated plant would also put Cardiff in a strong position for biodiesel production, assuming Europe commits to its own co-production of quality food and fuel rather than the current subsidised imports."

Flex Fuels has appointed Allerton Communications, a financial public relations consultancy, to advise on and help implement the Company's communications strategy.

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