Linas Agro Group, AB invests into biofuel production


The joint stock company Linas Agro Group has acquired Lignineko, UAB which owns
great quantities of lignin - a raw material for biofuel. Trade in lignin
biofuel will expand the range company's biofuel products and will strengthen
its position in the business of biofuel trade. 

Linas Agro, AB run by Linas Agro Group, AB has acquired 100 per cent of
Lignineko, UAB shares. The acquired company located in Zabieliskis village in
Kedainiai region has 800 thousand cubic metres of lignin. 

Lignin is a secondary raw material for wood industry. It is a complex molecular
compound found in dry wooden mass of plants. Former feedstuff additive producer
in Kedainiai Kedainiu biochemija used to make feed yeast from lignin, however,
the activities were terminated in 1992 after the rise of fuel and raw material
prices; thus, large quantities of lignin have remained unused. 

“The European Union has obliged to reduce CO2 emission into the atmosphere by
20 per cent until 2020 as compared to 1990 and increase effectiveness of power
usage as well as contribution of renewable energy sources at the same time. The
latter objective can be easily achieved only on account of biofuel usage. We
have been traded solid biofuel on the market since 2006. Also, we are
constantly looking for extraordinary raw material that can be used as biofuel.
For instance, in recent years we have been supplying sunflower husk granules
from Ukraine to Poland. 

Meanwhile, lignin as a raw material for biofuel caught our eye a couple of
years ago. We have been communicating with its suppliers and buyers in the
neighbouring countries. The European Union has recognised lignin as a raw
material for biofuel and included it into the standard EN 14961-1:2010 at the
end of 2009. This decision has given us an impetus to join the business of
lignin's preparation for biofuel and its trade, thus expanding our range of
solid biofuel. We plan to supply approximately 50 thousand tons of lignin for
LTL 7 million to the markets of Lithuania and neighbouring countries every
year. We have thoroughly analysed the market and expect high profitability of
this activity,” Linas Agro Group, AB Board Chairman Darius Zubas says. 

The company plans to dry and clean the acquired lignin until it is prepared for
biofuel; and additional equipment will be assembled for this purpose. The
general investments into this project will reach LTL 7 million. Investments are
calculated to pay off in 4 years. 

About Linas Agro Group, AB

Linas Agro Group, AB is an integrated agribusiness company engaged in
international agricultural business, production and trade in agricultural
produce and raw materials. It controls companies in Lithuania, Latvia and
Denmark. The Group consists of the following companies: Linas Agro, AB, a
Lithuanian company engaged in international trade in agricultural plant
produce; Linas Agro, UAB controlling grain storages; Grūdų centras, KŪB
(controlling grain storages in Kėdainiai, Kupiškis, Joniškis, Šiauliai and
Vilkaviškis), grain trade company in Latvia - Linas Agro, SIA; international
trade company in Denmark - Rosenkrantz A/S; Landvesta, ŽŪB, a group of
companies controlling agricultural land; and Linas Agro Konsultacijos, UAB
controlling agricultural companies. Financial year of the companies starts on
the 1st of July. According to the data of the first half of the financial year
the income stood at LTL 554,35 million while the net profit was LTL 25,7
million,  also, 59% of income was gained from the trade of grain as well as
oilseeds. In July-December 2009 the company sold 818 thousand tons of produce
which is by 6% more as compared to 2008. As of February 17, 2010 Linas Agro
Group, AB is listed on NASDAQ OMX Vilnius stock exchange. 

More information

Arūnas Jarmolavičius
Linas Agro, AB Project Director
Linas Agro Group, AB Board Member
Tel. 8 698 27855
Email a.jarmolavicius@linasagro.lt