Junior Fuel Additive Producer Receives Purchase Order from Multinational Company
Wednesday, June 22, 2011
The biodiesel industry is as subtly growing as any hot sector in the markets. The growth is non-linear as the always expensive first generation of products are a thing of the past resulting in exponential growth today and in the foreseeable future. Nearly ten years ago, production and capacity of biofuel-producing products were running hand-in-hand at about 2 million tons per year, but that is no longer true as in 2008 capacity was far outpacing production at a rate of approximately three to one (32.6 million tons per year as compared to 11.1 million tons per year, respectively).
The direction that leading biodiesel nations are taking should be perceived as a bellwether for the future of biodiesel growth. China has an area the size of England to produce non-food plants to generate biodiesel. India has more than 60 million hectares dedicated to produce jatropha or other plants for biodiesels as well. But, if a country is going to be a big dog in the industry, they will be comparing themselves to Brazil, the world's number one player in the renewable fuels market.
Brazil set forth on its path of action by not only promoting, but mandating, the use of alternative fuels back in 1975 with its National Alcohol Program. At that time, the initiative was the largest fossil fuel substitution program on the planet; demanding the use of sugarcane ethanol to power autos. Although no longer in effect, the mandate set the tone for Brazil’s proactive approach towards green fuels. To date, ethanol still represents over 50 percent of every liter of gasoline consumed in Brazil.
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A company looking to greatly benefit from the Brazilian initiatives is St. Louis, Missouri-based International Fuel Technology, Inc. (OTCBB:IFUE). Rapidly emerging as a leader in fuel performance enhancement, International Fuel Tech is focused on providing its two product lines, DiesoLiFT™ and PerfoLiFT BD-Series, to large, industrial consumers of diesel fuel and bio-diesel fuel blends in the rail, stationary power generation and road transport industries globally.
Both products are scientifically proven to provide significant benefits to diesel fuel and biodiesel fuel blends. DiesoLiFT™ 10 delivers improvements in fuel economy, a reduction in harmful emissions, increased fuel lubricity, it provides detergency benefits and co-solves normal amounts of free water, which collectively reduce maintenance costs for the end user. The PerfoLiFT BD-Series is a series of fuel additive formulations specifically developed to provide superior oxidation stability and deposit formation control to bio-diesel and bio-diesel fuel blends.
If receiving an order from any company is a single, then today International Fuel Technology hit a home run through a new purchase order from international behemoth Petrobras (NYSE:PBR). The publicly-held Brazilian-based company has deep ties to the “green push” of the Brazilian government, a fact easily discerned through the Brazilian government being the majority shareholder in Petrobras. The IFUE product is slated to be used in Petrobras three wholly-owned biodiesel manufacturing plants in Brazil which collectively produce over 150 million liters of biodiesel per year.
One would surely make the assumption that this may lead to major contracts and substantial revenue for Int’l Fuel Tech. Apparently those that draw those conclusions are on the same page as the IFUE team. Dr. Sergio C. Trindade, Int’l Fuel Technology’s Director of Science and Technology and Nobel Co-Laureate, commented in the press release, “We are confident that our additive will continue to perform on a superior level, as it has in past testing with Petrobras. IFT believes it is in a position to supply Petrobras with most, if not all, of its additive needs for their entire bio-diesel production.”
Investors have apparently been seeing the potential of the Company since it touched lows of 7 cents less than two months ago. The price has been mounting a ladder-like climb now for the last six weeks. As trading ended for the day, volume for IFUE is ranking as one of the top days in the last year and shares touched 20 cents for the first time since February after closing at $0.195. Holding the majority of its daily gains and virtually all of its gains since the rise from $0.07, International Fuel Technology certainly appears to be slowly, but surely grabbing the attention of not only major industry players such as Petrobras, but also the investment community.