Lignol Energy signs US$30 million agreement with U.S. Department of Energy to build demonstration cellulosic ethanol plant

On October 28, 2008, Lignol Energy Corporation (TSX-V: LEC) announced that its U.S. subsidiary, Lignol Innovations Inc., had signed a US$30 million Cooperative Agreement with the U.S. Department of Energy ("DOE"). The agreement formalizes the DOE's previously announced financial assistance award to Lignol of up to US$30 million relating to the construction of a commercial demonstration cellulosic ethanol plant in Colorado.

Lignol Energy is a leading technology company in the cellulosic ethanol and biorefining sector working to develop technologies for the production of fuel-grade ethanol and other biochemical co-products from non-food cellulosic biomass feedstocks. Once the ethanol plant is completed, it will process non-food cellulosic biomass such as hardwood, softwood and agricultural residues, and is expected to produce in excess of two million gallons per year of cellulosic ethanol and other biochemical co-products.

Lignol Energy was advised in the negotiation of this agreement by Blair Horn and Bruce Tattrie of Fasken Martineau.