Cathay Forest to buy stake in Eco-Energy

Cathay Forest Products Corp. said it will pay C$2.9 million (US$2.55 million) to acquire 40% of Eco-Energy China Group, a private biodiesel producer based in China’s southwestern province of Guizhou. Canada-listed Cathay Forest, which is headquartered in Richmond Hill, Ontario, Canada, manages about one million hectares of standing timber and poplar plantations in China and Russia. The company said its forestry expertise and regional network will assist Eco-Energy in furthering its plantation expansion strategy to become a leading biodiesel producer in China. Eco-Energy’s assets include a 40,000 hectare plantation of jatropha curcas, a drought-resistant perennial plant that grows in poor soil, usually to a height of three to five meters. It also owns a recently completed biodiesel refinery. Cathay Forest’s investment in Eco-Energy, the company said, will allow it to advance into the world of biofuel production using forestry assets and by-products. (May 20, 2009)