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GEM BioFuels has been established to supply feedstock to the rapidly growing global biodiesel market. The Directors believe that one of the most significant potential constraints on the growth of this market is the relatively limited supply of biodiesel feedstock, and that this provides a significant commercial opportunity for the Company.
GEM BioFuels is initially focusing on the establishment of 'company managed' plantations of Jatropha trees in Madagascar and the extraction of the vegetable oil that is produced from its seeds as this oil is well suited to use in the production of biodiesel. To facilitate its plantation development, GEM BioFuels has entered into 18 agreements with Communes in relation to 452,500 hectares of land suitable for the establishment of plantations in Madagascar, which provide it with the exclusive right to establish Jatropha plantations on the land. To date approximately 55,700 hectares have been planted. In addition GEM BioFuels has an agreement in relation to 40,000 hectares containing natural forest, including significant numbers of mature wild Jatropha trees. Separately, the Company also has informal arrangements with a number of individuals for the delivery of wild seed to the Group’s storage facility. |
