Third Off-take Agreement to Supply CPO Signed

RNS Number : 4660I

Dekeloil Public Limited

02 June 2014

 



DekelOil Public Limited / Index: AIM / Epic: DKL / Sector: Food Producers

2 June 2014

DekelOil Public Limited ('DekelOil' or 'the Company')

Third Off-take Agreement to Supply Crude Palm Oil from 60 t/hr extraction Mill in Côte d'Ivoire

DekelOil Public Limited, operator and 51% owner of an established vertically integrated palm oil project in Côte d'Ivoire, is pleased to announce it has signed an off-take agreement ('the Agreement') with Sania Cie ('Sania'), a local refining company in the Côte d'Ivoire, to supply Crude Palm Oil ('CPO') produced from its 60 t/hr extraction Mill ('the Mill').  This is the third off-take agreement DekelOil has signed and is in line with its strategy to diversify its customer base, commercialise its assets and in the process build a leading West African palm oil company.  

Under the terms of the Agreement, DekelOil will supply Sania with all available CPO that satisfies the following quality thresholds: no higher than 5% fatty acids; maximum 0.3% moisture and impurities content; 39 degrees Celsius melting point and an iodine value of 50-55.  In return for the CPO, DekelOil will receive the official AIPH price, which is similar to the CIF Rotterdam price.  The Agreement covers an initial period to 31 December 2014 at which point it will be renewed for successive twelve month periods unless a three month notice of termination is provided by either DekelOil or Sania.  By selling the CPO locally, the Company will benefit from reduced transportation, insurance and marketing costs. 

Dekeloil Executive Director Lincoln Moore said, "Having already secured buyers for our 2014 CPO production through off-take agreements with local refiner SAR and local manufacturer Adam-Afrique, we are delighted to further diversify our customer base with the addition Sania.  We have now signed three off-take agreements in 2014 all with local companies, demonstrating strong demand for CPO milling capacity in the Côte d'Ivoire.  Along with a demand / supply imbalance for CPO across West Africa, we believe there will be no shortage of additional buyers for our CPO as and when they are required."

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For further information please visit the Company's website www.dekeloil.com or contact:

Youval Rasin	DekelOil Public Limited	Tel: [phone]
Shai Kol	DekelOil Public Limited	Tel: [phone]
Lincoln Moore	DekelOil Public Limited	Tel: [phone]
Christian Dennis Jeremy King Roland Cornish Rosalind Hill Abrahams Elisabeth Cowell	Optiva Securities Limited Optiva Securities Limited Beaumont Cornish Limited Beaumont Cornish Limited St Brides Media & Finance Ltd	Tel: [phone] Tel: [phone] Tel: [phone] Tel: [phone] Tel: [phone]
Frank Buhagiar	St Brides Media & Finance Ltd	Tel: [phone]

Notes:

DekelOil Public Limited is a low cost producer of palm oil in West Africa, which it is focused on rapidly expanding.  To this end, it has a 51% interest in one of the largest oil processing mills ('the Mill') based in Côte d'Ivoire, which has a capacity of 70,000 tons of Crude Palm Oil ('CPO').  Feedstock for the Mill comes from 27,000 hectares of mature palm oil plantations that have been secured under long term contracts with smallholders, however it also has nearly 1,900 hectares of its own plantations.  Furthermore, it has a world-class nursery with a 1 million seedlings a year capacity.  Currently, it has one off-take agreement to deliver 24,000 tonnes of CPO per annum to a local refiner and is in discussions with other potential partners. 

 

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