Rocky Mountain Sustainable Enterprises Signs Biodiesel Fuel Supply Agreement With Gray Oil Co, Inc.

[Jen Scherpenseel]

$45 million contract to be supplied from new state-of-the-art Colorado bioXchange™ refinery in Fort Morgan

Rocky Mountain Sustainable Enterprises, LLC (RMSE), a leading provider of smart, sustainable biofuels, announced today that it has entered into a biodiesel fuel supply agreement with fuel distributor Gray Oil Company, Inc., to supply up to 4.5 million gallons per year of biodiesel fuel for a three year term.

The agreement has an estimated revenue value of $45 million over the three-year term, according to RMSE CEO Aaron Perry, adding that the revenue value could be millions of dollars higher if energy market prices trend upward.

The biodiesel will be supplied from RMSE’s Colorado bioXchange refinery, a $5 million plant that breaks ground this fall and will be the state’s only producer of premium biodiesel from sustainable resources, producing fuel that meets federal ASTM standards.

“We are excited to be working with Gray Oil, a premier fuel distributor in the Rocky Mountain region, and market leader in the adoption and promotion of biofuels,” said Perry. “This agreement helps us close the loop on truly sustainable biodiesel supplies that are regionally sourced, produced and used, while delivering highest value to our restaurant and commercial facility customers.”

Gray Oil chose to work with Rocky Mountain Sustainable Enterprises because RMSE’s product delivers much higher value than other biodiesel fuels on the market.

“The fact that RMSE is deploying state of the art biodiesel production technology that can produce the fuel from recycled feedstocks such as used cooking oil while maintaining the highest quality and fuel performance specifications, allows us to deliver a premium biodiesel fuel product to our customers at price points much more competitive with petroleum diesel,” said Tom Gray, CFO of Gray Oil.

Colorado bioXchange™ plant coming on-line
After a three-year due diligence technology period, RMSE selected the advanced multi-feedstock production technology from a European company for its Colorado bioXchange™ biodiesel production facility under development in Fort Morgan, Colorado. At the time of commissioning – expected to be in the summer of 2010 – the Colorado bioXchange ™ production facility will have an initial annual production capacity of 4.5 million gallons per year – the equivalent of 0.5% of the diesel fuel consumed per year in the Colorado market.

Supplied in significant part by RMSE’s vertically integrated recycOil® commercial cooking oil recycling service and managed through the Cleantech company’s total supply chain, IT and logistics technologies, the Colorado bioXchange™ will close the loop by converting a significant waste-resource stream into an environmentally friendly and economically competitive energy product.