GS Agrifuels, Global Ethanol form biodiesel venture

New York's GS AgriFuels (OTC: GSGF) announced that it formed a corn oil biodiesel joint venture with Minneapolis, Minn.-based Global Ethanol.

The two plan to build a 30 million gallon per year corn oil biodiesel plant in Lakota, Iowa.

GS AgriFuels is a unit of GreenShift (OTC: GSHF), also based in New York.

"Global Ethanol is a leading producer of renewable fuels and is committed to increased production efficiencies and diversifying our commodities mix," said Trevor Bourne, CEO of Global Ethanol.

"GreenShift's corn oil extraction and biodiesel production technologies have proven themselves to be the best solution available to achieve this."

The companies plan to extract about 10 million gallons per year of crude corn oil from the distillers grain co-product of Global Ethanol's 100 million gallon per year ethanol facility in Lakota and 57 million gallon per year ethanol facility in Riga, Mich.

The crude will be converted into biodiesel at the new Lakota plant, to be built at the Global Ethanol site.

The joint venture, called GS Global Biodiesel, will build, own and operate the corn oil biodiesel plant, which will initially be sized for 10 million gallons per year, then scaled up to 30 million gallons.

GS AgriFuels said it would raise and provide the financing for the $35 million project, covering construction of the corn oil extraction systems at Global Ethanol's Lakota and Riga ethanol facilities, as well as the financing for the construction and operation of the GS Global Biodiesel facility.

Global Ethanol will manage and operate the new plant and market all of the biodiesel produced.

The GS Global Biodiesel facility is expected to be commissioned during the fourth quarter of 2008.

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