By OGJ editors
HOUSTON, Nov. 5 -- A cooperative of rural municipalities signed a letter of intent with a subsidiary of Outlook Resources Inc., Toronto, to jointly develop and build an ethanol plant in the Dauphin and Roblin region of Manitoba.
Outlook's Atlantol Industries Inc. said the proposed plant, estimated at $50 million (Can.), would be capable of producing 80 million l./year of fuel grade ethanol.
The Parkland Agricultural Resource Cooperative (PARC) represents 5,200 farms consisting of 2.5 million acres of producing farmland. The agreement provides PARC's members with the option to acquire up to a 25% interest in Atlantol.
PARC agreed to pay $50,000 for an engineering feasibility study to be prepared by Dillon Consulting Ltd. Outlook, and PARC await the results of the engineering feasibility study before proceeding to the next stage.
Once the engineering feasibility study is completed, PARC can obtain its stakeholder's position by providing an additional $2.45 million for plant development and construction.
The agreement hinges upon Atlantol arranging financing to cover 25% of the project costs and obtaining a binding commitment for project financing equal to 70% of the project costs.