NEWSMerisol Buys Cresylic Acid Feedstock From SGI International's Encoal Plant
LA JOLLA, Calif., March 30 /PRNewswire/ -- SGI International (OTC Bulletin Board: SGII - news; SGII) announced today that SGII and Merichem - Sasol USA LLC (Merisol) have signed an agreement through which Merisol will purchase the entire output of cresylic acid feedstock to be produced by SGII at its ENCOAL Liquids From Coal (LFC) plant located near Gillette, Wyoming. Shipments under this agreement are expected to begin in late 2000 and continue through December 31, 2007. The feedstock will be shipped to Merisol's Houston, Texas, plant for further processing into pure cresylic acid. Cresylic acid is used in a variety of applications that range from antioxidants, coatings, cleaners and disinfectants to vitamin E intermediates.
The approximately two million annual pounds of feedstock from ENCOAL represents a new domestic source of supply to a market that relies partially on imported feedstock. The agreement anticipates that the parties will also contract for the cresylic acid feedstock from large-scale commercial plants that SGII may build in the future.
Michael L. Rose, SGII Chairman and CEO stated: ``We are pleased to have finalized this agreement with Merisol. To be associated with a company with such a great international reputation is a definite plus for SGII. Including the enhanced coal product (PDF), we now have two of the five products from ENCOAL under long-term agreements. The other three products are in the final stages of contract negotiations. Obtaining this contract further confirms the economics surrounding the operation of our ENCOAL plant and confirms the market interest in the products from the LFC process.'
Pete D. Alford, Merisol's Manager, Raw Materials, noted that: ``We are always looking for quality feedstocks at competitive prices. Our hope is that SGI International will be successful in developing a large-scale commercial plant that will provide additional feedstock quantities.'
SGII's business is developing proprietary technology to upgrade low-value carbon feedstocks (primarily low-rank coals, heavy crude oil and petroleum refinery resid) into valuable carbon fuels and products and into valuable specialty chemicals. Its corporate headquarters is in La Jolla, California.
(This news release contains forward-looking statements. Actual results could vary from those expected due to a variety of risk factors, including, but not limited to, the uncertainty of successful completion of contemplated or proposed business transactions.) |
