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Velocys customer awarded grant for BTL plant

Hydrocarbon Engineering,

Velocys has announced that its customer, Red Rock Biofuels, has been awarded a US$ 70 million grant to construct a biomass-to-liquids (BTL) plant in Oregon, incorporating Velocys Fischer-Tropsch (FT) technology.

Commenting on the award, Roy Lipski, CEO said: "We are very pleased to see the Red Rock project moving ahead. This US$ 70 million government grant is set to make the Oregon project happen and will act as a catalyst for early adoption of BTL in North America. We are proud to be at the leading edge of this important market."

Red Rock Biofuels, a Fort Collins, Colorado based subsidiary of IR1 Group LLC (IR1), has extensive experience constructing and operating commercial-scale biofuels facilities. This new BTL plant in Oregon will convert approximately 170,000 tpa of forestry and sawmill waste into approximately 1100 bpd of ultra clean transportation fuels.

The grant is being awarded under phase 2 of the US Defense Production Act Title III Advanced Drop-in Biofuels project. In July 2013, Red Rock Biofuels was awarded US$ 4.1 million under phase 1 of the same program to conduct detailed engineering for the BTL facility, which is now complete.

Successful execution of Red Rock's project in Oregon is expected to result in revenues to Velocys in excess of US$ 15 million during construction, and an additional US$ 30 million or more over the life of the facility. Red Rock is targeting final investment decision on the project within 6 months, with construction lasting about 18-24 months.

Adapted from press release by Katie Woodward

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