CHENNAI, INDIA — (Marketwire) — 11/30/10 – Clenergen Corporation (OTCQB: CRGE)(FRANKFURT: 9CE) has entered into a Memorandum of Agreement (“MOA”) with SV Sugar Mills Limited (“SVS”) to take over operations of an existing 27MW/h biomass power plant (the “Plant”), which has the ability increase Clenergen’s operating capacity to 51.5MW/h by the end of 2011 and projected run rate revenues to circa $40 million per annum.
The biomass power plant is located next to the Clenergen’s own 18MW/h plant in Kancheepuram, Tamilnadu, India. SVS will be responsible for funding all capital expenditure relating to the plant and, through an operating lease, Clenergen will be responsible for running the Plant and supplying SVS with a proportion of the power output.
Once certain refurbishment works are complete, it is expected that the Plant will operate at 80% capacity and generate a net 22MW/h of electricity per annum, operating on a 24 hour basis, with the balance of which will be sold through merchant power trading contracts at premium tariffs.
In addition to operating the Plant, Clenergen intends to contract with SVS for the supply of bagasse from its sugar mill during the six month sugar cane season. Clenergen will use the bagasse as sustainable feedstock for its 18MW biomass plant and due to the proximity of the 2 plants transport costs will be dramatically reduced. The quantity of bagasse biomass in season is sufficient to operate the power plant throughout the year.
Further collaboration between SVS and Clenergen is also being explored whereby Clenergen intends to procure the biogas (methane) from SVS to fuel a 2MW/h gas generator to be located at its existing 18MW/h biomass power plant site. Also, as SVS’s operations extend to the procurement of wood chips from West Africa, SE Asia and South America. Clenergen and SVS are exploring the options for collaboration on fuel stock supplies.
Commenting on the MOA, Mark Quinn, Executive Chairman of Clenergen Corporation, said “The agreement provides us a turnkey operation which will be managed by our team already based in Kancheepuram. The supply of bagasse biomass at a fixed cost to per annum allows the company to maximise its profit margins at the capacity levels being projected”.
About Clenergen Corporation
Clenergen Corporation is a publicly-traded company with its common stock quoted in the USA on the OTC Market (Symbol: CRGE) and in Germany on the First Quotation Board, Open Market of the Frankfurt Stock Exchange (Symbol : 9CE) Clenergen offers strategic clean energy generation and supply of biomass feedstock to address the requirement for renewable and sustainable supplies of electricity. Clenergen has developed a unique modular system for gasification and localized plantation management. Clenergen also plans to provide biomass feedstock for producing wood pellets for co firing with coal to produce low emission electricity.
Clenergen Corporation uses biomass feedstock to implement sustainable supplies of clean energy for captive end users, islands, mining companies, government or privately-owned power grid systems and other end users. The “Distributed Environmental Power System” marries significant proprietary advancements in plant science with proven long standing engineering technologies to achieve this goal. For further information on Clenergen Corporation and its products and services, go to: www.clenergen.com.