22/01/2016 (Proactive Investors.co.uk) - The agreement is part of a plan to increase CPO production towards the mill's 70,000 tonnes per annum capacity.

Ivory Coast-based palm oil supplier DekelOil (LON:DKL) has agreed a six months processing deal with a smallholder to be partly paid in shares at a substantial market premium.

DekelOil said the small holder, who owns 1,000ha of mature estates, asked for half of the consideration in shares at 1.52p each against yesterday’s close of 1.1p.

The agreement is subject to a minimum stock settlement equivalent to £117,000 and a cap of £235,000.

The smallholder will supply fresh fruit bunches for processing through DekelOil’s 60t/hr crude palm oil (CPO) processing plant.

Lincoln Moore, executive director, said: "We view the smallholder's request to be partially paid in shares of DekelOil priced at a premium to the current market price as a strong endorsement of our company and its near term valuation potential."

DekelOil added the agreement was part of a plan to increase CPO production towards the mill's 70,000 tonnes per annum capacity.  CPO production was 35,770 tonnes in 2015, a 150% increase.