LONDON: Active Energy Group Plc, an international biomass based renewable energy business, has agreed terms for the issuance of its first CoalSwitch Licence Agreement to RMD Environmentals, Inc. (RMDE) to develop and manage projects involving the use of CoalSwitch technology in each of the Crown Provinces of Alberta and British Columbia in Canada.

RMDE is a British Columbia based forestry management and environmental engineering and consultancy business.

AEG has executed a 20-year exclusive License Agreement with RMDE, Inc., a commercially focused environmental engineering, and production company with a focus on developing forestry residuals and low/no value fibre waste into biomass fuel products.

Under the terms of this License Agreement, AEG has granted and RMDE has purchased exclusivity over the sale and commercial development of all opportunities to which the CoalSwitch technology may be applied in the Territories.

RMDE has paid to AEG an upfront fee license fee of US$1.8m (CAD 2.4million) and has agreed to make future royalty payments of US$5.00 per tonne to AEG for the Licensed CoalSwitch Product that is produced using the CoalSwitch technology and know-how.

It is anticipated that RMDE will commission its first plant within the next 18 months, subject to environmental and other permitting processes being finalised. To this end, RMDE has commenced initial preparatory and pre-engineering work in Alberta for its first plant and is working on additional projects using the CoalSwitch technology in the Territories.

Active Energy CEO, Michael Rowan said, “This inaugural Licence Agreement with RMDE is a significant strategic milestone for AEG as the Company focusses on the commercial roll-out of the CoalSwitch and black pellet biomass technology, which it has invested in and developed over the last four years.

“AEG’s Directors believe the existing and future market opportunity for advanced biomass fuels and fuel additives, which utilise waste wood, including forestry residuals, fire, insect, disease affected timber and other legacy forestry industry waste, and which have significant renewable and sustainability advantages, has never been more relevant.

“To capitalise on these opportunities, AEG recognises that it needs to accelerate market development through the construction of operating, high volume, production facilities in various regions. This will be achieved both through wholly owned production facilities, such as the Lumberton site in North Carolina (the “Lumberton Facility”) and through commercial partnerships worldwide. RMDE is AEG’s first Licensed Partner; the Directors believe collaborations of this nature will expedite the commercial roll-out of CoalSwitch.

“AEG has commenced discussions with several other potential licensees to license and utilise the CoalSwitch technology in other regions of the world to take advantage of the increasing demand for advanced biomass fuels.”

RMDE Chairman, Grand Chief Ronald Derrickson said, “RMDE is pleased to become the first Licensee Partner for AEG’s CoalSwitch technology in Canada. Following an intensive period of due diligence, AEG has demonstrated to RMDE, that it can provide the technical and IP support required to give us, our partners and outside investors the confidence to build, commission and operate reliable plants, with high quality equipment manufactured and delivered with AEG’s assistance. This has given us the confidence to invest in the License for two key territories involved in the forestry and wood processing industry in Canada and to complete negotiations with a major off taker for up to 1 million tonnes of CoalSwitch per annuum from installations in the Territories.”