Chin Lakes Biodiesel Plant Marketing Strategy

Biodiesel

There are two prospective markets for biodiesel in Canada. The first market is the forthcoming market based on regulatory mandates in British Columbia in 2010 and nationally in 2012. BC's B5 mandate will require a minimum of 200 million litres per year for on road markets alone and may double if extended to all diesel markets in the province. The Federal Renewable Fuels Standard will require the delivery of about 1.5 billion litres starting in 2012.

Growing quickly is the non-mandate market consisting of large niche markets where customers are focused on making large reductions in greenhouse gases and use up to B30 blend levels of biodiesel. For example, niche customers in British Columbia currently use 40 million litres of biodiesel per year including users such as BC Transit, TSI Terminals, City of Vancouver and cruise ships as well as home heating and card locks. The volume estimates for the non-mandated market are at least the same amount as the prospective mandated market and large users have been operating under biodiesel supply agreements. Two primary off-take agreements, once secured, will consume up to 90% of the total facility production.

BFuel Canada Corp is developing a marketing and distribution strategy, which includes sales to a sizeable customer base of companies prior to the operation of its plant. BFuel Canada Corp has established relationships with large independent petroleum distributors, serving market niches such as the construction industry, trucking companies, farmers and agricultural producers, which have expressed their interest in a business relationship.

A large group of prospective customers are companies concerned with reducing their environmental impact by reducing Green House Gas emissions. These companies are interested in using biodiesel or higher blends that the mandate requires, since this alternative is more economical than replacing equipment or changing manufacturing processes.

To serve the local wholesale and retail market, BFuel Canada Corp plans to build a storage and blending card-lock facility on a 3.5 acres site in Lethbridge. As well, since November of 2006 BFuel Canada Corp. sponsored six information sessions in southern Alberta which were attended by approximately two hundred producers and interested participants. An informed potential biodiesel user is critical to ensure the wide acceptance and use of biodiesel in the Canadian market. BFuel Canada Corp. is uniquely planning, educating and developing the market for future supply from the proposed plant.

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Glycerine

There is a current value and market for glycerine. Bfuel is currently looking at technology to produce pharmaceutical grade glycerine, which has a much higher market value.

[BFuel Biodiesel Plant Marketing Strategy - top]

Canola Meal

Canola meal is the largest by-product from the crushing process. BFuel’s preferred market for the meal is cattle feed. The cattle industry is recognizing the high quality of protein in the canola meal, and is starting to fuel demand for the by-product.

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