Under the terms of the MoU, Shore Gold Inc. (“Shore Gold”) will provide waste timber from its mining activities to Nipawin Biomass Ethanol New Generation Co-operative Ltd. (“Nipawin Biomass”) which will process and convert the timber to cellulose ethanol at its proposed green fuel facility in the town of Nipawin, Saskatchewan, Canada.
Shore Gold is currently in the process of developing Saskatchewan's first diamond mine, the Star-Orion South Diamond Project, at a site in the Fort à la Corne forest which is approximately 60 kilometres west of the town of Nipawin, Saskatchewan. Shore Gold states that the proposed diamond mine site will require approximately 4,250 hectares to be cleared of timber, which is less than 4 percent of the forest.
Nipawin Biomass and the Saskatchewan Research Council have jointly developed a proprietary conversion technology which will process synthesis gas from waste wood and waste farm fibre, such as flax fibre or straw, into ethanol and other alcohols. Its proposed ethanol plant in Nipawin will require approximately 200,000 oven dried metric tonnes of cellulosic fibre per year, approximately two-thirds of which would come from forest waste product. Shore Gold's available supply would provide a significant volume, but only a fraction of the ethanol plant's needs.
The MoU provides that the parties will work together to achieve cost reduction for Shore Gold, a secure supply of cellulose at the best possible terms for Nipawin Biomass and seek involvement of First Nations people or businesses in the clearing, removal and transportation of the biomass.
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