ETHANOL PROJECT UPDATE
Maple Energy (AIM: MPLE; LIMA: MPLE), an integrated energy company with assets in Peru, is pleased to give an update on its ethanol project (the "Ethanol Project").
Ethanol Project Overview
The Company is developing an estimated US$ 254 million, greenfield ethanol project on the northern coast of Peru consisting of (i) a 7,800 hectare sugar cane plantation in the initial phase which will provide sugar cane feedstock to the Ethanol Project and which includes main water delivery and drip irrigation systems, (ii) an ethanol plant (the “Ethanol Plant”) with capacity to process up to 5,000 tons per day of sugar cane and produce up to 35 million gallons of ethanol per year, (iii) a 37-megawatt ("MW") power plant to supply all of the Ethanol Project's power requirements with the sale of any excess power, expected to be approximately 17 MW, to the Peruvian national power grid, (iv) a 60-kilovolt electric transmission line to connect the Ethanol Project facilities to the power grid and a 33/22.9-kilovolt distribution system for the plantation and pump stations, and (v) third-party operated and owned ethanol storage, loading, and shipping facilities near the Port of Paita.
The Company is in advanced stages of developing the Ethanol Project and has expended approximately US$ 146 million to date for the development and construction of the Ethanol Project. Maple currently expects to commence commercial operations of the Ethanol Project during the second half of 2011.
Agriculture and Irrigation
The Company plans to plant 7,800 hectares of sugar cane in the main estate in the first phase of development of its land in the Ethanol Project area, and 7,300 hectares of the land for this first phase have been cleared. Primary and secondary seed cane farms totaling 345 hectares have already been developed, and Maple expects to begin the commercial planting of sugar cane on the main estate by the end of this year using seed cane from these farms.
The Macacara Pump Station is substantially completed and is currently in operation extracting water from the Chira River for delivery through a pipeline and canal system to the 660,000 cubic metre Macacara Reservoir which is completed and in operation. The El Arenal Reservoir, with a capacity of 110,000 cubic metres, is also completed, and the El Arenal Pump Station is currently under construction with a significant portion of the civil works completed. The two river pump stations will be used to supply all the water requirements for the 7,800 hectares being developed in the first phase.
Construction is in progress on the approximate 43-kilometre water pipeline system which forms part of the main water delivery system for the Ethanol Project, and approximately 30 kilometres of this pipeline system are already installed. The main water delivery system will supply water to 13 drip irrigation system pumping stations which will deliver water to the drip irrigation systems for the sugar cane plantation. To date, the civil works for nine drip irrigation system pumping stations have been completed, and one of these stations has been put into operation. The drip irrigation systems for the Ethanol Project have been installed in over 900 hectares of the plantation including the systems for the seed cane farms.
Industrial Facilities
Uni-systems, Inc. has manufactured approximately 70% of the sugar cane handling, juice extraction, and juice treatment equipment required for the Ethanol Plant, and the fermentation, distillation, and dehydration equipment necessary to produce fuel-grade ethanol has already been manufactured by Praj Industries Limited and delivered to Peru.
The boiler and steam generation equipment currently being manufactured by Uni-systems and Allsoft Engenharia e Informatica Industrial Limitada (also know as Mitre) is 75% completed, and the first shipment of this equipment is expected to depart to Peru by the end of this year.
The turbogeneration equipment with a capacity to produce up to approximately 37 MW has already been manufactured by Siemens, and the first shipment of this equipment is expected to depart to Peru by the end of this year.
By the end of the first quarter of 2011, all the major equipment packages described above are expected to have been delivered to the Ethanol Project site. Haug S.A., the contractor in charge of the construction of the Ethanol Plant, has commenced the construction activities for the installation of these major equipment packages as well as the 60-kilovolt transmission line. In addition, Penta Tanks Terminals S.A. has begun construction activities on the ethanol storage, loading, and shipping facilities near the Port of Paita, and these facilities are expected to be in operation and available for use when the Ethanol Project commences commercial operation.
Expected Low Cost Ethanol Production
As a result of the Ethanol Project's particular characteristics, Maple believes it possesses a significant competitive advantage relative to most other ethanol producers around the world. Maple estimates that its production costs per gallon of ethanol produced may be significantly below the reported production costs of many other producers of ethanol. The use of an efficient feedstock, sugar cane, combined with the Peruvian climate, which allows year round growing and harvesting of sugar cane, and modern operational techniques, including automation and the use of drip irrigation to fertilize and irrigate the sugar cane, are primary reasons Maple expects the Ethanol Project to maintain this advantage. In addition, the location of the Ethanol Plant within the sugar cane plantation, as well as its proximity to a seaport, should enable Maple to reduce transportation costs.
Company Presentation
The Company has posted a presentation on its website (
www.maple-energy.com) describing its ongoing business and operations which provides further detail on the progress of the Company’s exciting Ethanol Project.
Rex Canon, CEO of Maple Energy, commented today:
"While there is a great deal of work ahead of us, Maple is making excellent progress with the Ethanol Project, and we are confident that we will commence commercial production of ethanol in the second half of 2011. We are using sophisticated technology and expect to be a low-cost, globally competitive producer of ethanol, a fuel that is growing in popularity worldwide. As a result, I believe that 2011 will prove to be the most exciting year yet for Maple and look forward to updating shareholders with news of our progress as we head towards commercial production.”
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