SOURCE: KL Energy Corporation

KL Energy Corporation

June 25, 2012 09:00 ET

KL Energy Corporation Announces New Joint Development Agreement With Petrobras SA

RAPID CITY, SD--(Marketwire - Jun 25, 2012) - KL Energy Corporation (OTCQX: KLEG) (PINKSHEETS: KLEG) ("KLE") today announced that it has successfully completed the first phase of the work program under the Joint Development Agreement ("JDA") with Petrobras America, Inc. signed on August 23, 2010.

All cellulosic ethanol produced from sugarcane bagasse in KLE's demonstration plant in 2011 has been shipped to Petrobras SA ("Petrobras") in Brazil. KLE recorded the first cellulosic ethanol RIN credits issued by the Environmental Protection Agency ("EPA").

Having met all technology milestones and ethanol production targets, Petrobras and KLE decided to extend the scope of the JDA.

Under the terms of the extended JDA, KLE upgraded its demonstration plant, expanded production process validations and added on-site yeast production capabilities. The plant now represents the design of future commercial plants, with one tenth of the planned capacity, engineered for integration with Brazilian sugarcane mills. Throughout most of the balance of 2012, KLE will process sugarcane bagasse into fuel spec ethanol.

On April 17, 2012, as provided by the JDA, KLE signed a Technology and Patent License Agreement with Petrobras, which licenses KLE's cellulosic ethanol technology to Petrobras for the use in any of its Brazilian sugarcane production assets.

João Norberto Noschang, Petrobras Biocombustíveis, manager biofuels, commented: "Petrobras is committed to bringing the most advanced biofuels technologies to the Brazilian market. With the support of KLE we have made great advance in the area of cellulosic ethanol, which is best documented in the first industrial production of ethanol from sugarcane bagasse in 2011."

KLE's President and Chief Executive Officer Peter Gross said: "The last few years have been challenging for the entire advanced biofuels industry, but jointly with our partner Petrobras we have kept our heads down and worked hard towards achieving all of our technical and commercial goals. At the end of the 2012 sugarcane bagasse program we will have an industrially validated technology specifically designed for Brazilian sugar mills."

About Petrobras

Petrobras is a major integrated oil, gas, and energy company operating in the following segments of the industry: exploration and production; downstream, marketing, transportation and petrochemicals; distribution; natural gas, energy and biofuels. Established in 1953 as Brazil's National Oil Company, Petrobras today is a publicly traded company whose principal operations are still in Brazil, but where it now competes under an open and competitive regulatory framework. Recognized by its massive resource base and its global leadership in deep and ultra-deep water exploration, Petrobras is now one of the world's ten largest companies by market capitalization. The company operates in all five continents and in 29 countries. The company has also activities in renewable energies, especially in biofuels, for which Petrobras established a subsidiary company, Petrobras Biofuel.

About KL Energy Corporation

KL Energy Corporation develops and commercializes technology to convert biomass into fermentable sugars, lignin and ethanol. KLE operates a demonstration plant with a production capacity of up to 10,000 liters of fuel spec anhydrous ethanol per day. Since 2010, the company has focused on optimizing its technology for sugarcane bagasse feedstock working in close cooperation with Petrobras. KLE has developed a process technology designed especially for integration with Brazilian sugarcane mills, which it is commercializing in the form of a pre-engineered and ready-to-implement plant.

Contact Information

  • Peter Gross
    President & CEO