MARKET DEVELOPMENT
UPDATE - DekelOil\'s Palm Oil Plant on Course to Generate First Revenues in January
UPDATE - DekelOil\'s Palm Oil Plant on Course to Generate First Revenues in January
24/10/2013 (Proactive Investors Australia) - Shares in DekelOil (LON:DKL) surged 20% on Tuesday as it further advances its goal of becoming a significant producer of Crude Palm Oil (CPO) in the Ivory Coast.
Its 60-tonnes-per-hour palm oil extraction mill is on course to generate revenues in January next year, it told investors.
In a progress update, the company said an empty run test of all equipment is scheduled in January next year followed by a full capacity test ahead of the peak fruit harvesting season beginning in March.
The plant in the Ivory Coast is set to become one of West Africa's largest with a capacity to produce 70,000 tonnes a year.
Lincoln Moore, executive director, told investors: "As demonstrated by the strong progress made with the construction of the mill, we remain on course to start operations in January 2014 and generate material revenues from CPO production in the peak harvesting season between March and June 2014.
"We are currently putting an efficient logistics network in place to ensure the mill receives a constant supply of fruit and we are advancing these plans in tandem with our off-take discussions with a number of third parties, including leading international buyers of palm oil."
Talking to Proactive Investors about the plant, he added: "The aim for 2014 is to produce 35,000 to 40,000 tonnes of CPO. In order to do that we need to put through roughly about 150-180,000 tonnes of fresh fruit bunches to get that 22% extraction rate, which therefore gets your 35,000 to 40,000 tonnes of CPO."
Broker Optiva Securities, which rates the shares a 'buy', said: "DekelOil is now a step closer to becoming a significant producer of Crude Palm Oil (CPO) in Cote D’Ivoire.
"DekelOil is sourcing palm oil crops from smallholder plantations covering 27,000 hectares. With the final jigsaw piece almost in place, the completion of the 60t/hr CPO extraction mill, it will be ready to produce sustainable revenues and sizeable cash flows."
Optiva has a target price of 1.63p on the stock, which is a more than 55% increase on where the shares are now - at 1.05p.
Its 60-tonnes-per-hour palm oil extraction mill is on course to generate revenues in January next year, it told investors.
In a progress update, the company said an empty run test of all equipment is scheduled in January next year followed by a full capacity test ahead of the peak fruit harvesting season beginning in March.
The plant in the Ivory Coast is set to become one of West Africa's largest with a capacity to produce 70,000 tonnes a year.
Lincoln Moore, executive director, told investors: "As demonstrated by the strong progress made with the construction of the mill, we remain on course to start operations in January 2014 and generate material revenues from CPO production in the peak harvesting season between March and June 2014.
"We are currently putting an efficient logistics network in place to ensure the mill receives a constant supply of fruit and we are advancing these plans in tandem with our off-take discussions with a number of third parties, including leading international buyers of palm oil."
Talking to Proactive Investors about the plant, he added: "The aim for 2014 is to produce 35,000 to 40,000 tonnes of CPO. In order to do that we need to put through roughly about 150-180,000 tonnes of fresh fruit bunches to get that 22% extraction rate, which therefore gets your 35,000 to 40,000 tonnes of CPO."
Broker Optiva Securities, which rates the shares a 'buy', said: "DekelOil is now a step closer to becoming a significant producer of Crude Palm Oil (CPO) in Cote D’Ivoire.
"DekelOil is sourcing palm oil crops from smallholder plantations covering 27,000 hectares. With the final jigsaw piece almost in place, the completion of the 60t/hr CPO extraction mill, it will be ready to produce sustainable revenues and sizeable cash flows."
Optiva has a target price of 1.63p on the stock, which is a more than 55% increase on where the shares are now - at 1.05p.