TORONTO, ONTARIO -- (Marketwired) -- 06/06/13 -- Solutions4CO2 Inc. ("S4CO2" or the "Company") (TSX VENTURE: SFC) is pleased to announce that it has finalized a joint venture (the "JV") with Quinlan Brothers Ltd. ("Quinlan") previously announced by the parties under a Letter of Intent dated March 22, 2013. The JV will produce high value Omega 3/Astaxanthin enriched oils (the "Products") from cold water shrimp waste streams using S4CO2's Bio-Extraction Process TM (the "Process"). Quinlan Brothers Ltd is a Canadian processor of cold water shrimp and snow crab from its processing facility located at Bay de Verde, Newfoundland and Labrador.
Under the terms of the JV, the parties agree:
1) That Quinlan will provide the JV with exclusive rights to the Quinlan Feedstock under a Supply Agreement and the JV will seek to secure additional feedstock supply from global sources beginning Q3 2013.2) S4CO2 will grant all rights and usage of its Bio-Extraction Process, and all improvements thereto, to the JV for the purpose of conducting the Business, on an exclusive, no-fee basis covering North America.3) That the JV will outsource the majority of the processing of the Quinlan Feedstock to toll processors until December 1, 2013.4) The JV will negotiate global off-take contracts for the sale of the 2013 Products.5) The JV will negotiate the toll-processing contract(s) for the 2013 production of the Products with such contracts including quality assurance, packaging and labelling based on the off-take agreements.6) Quinlan and S4CO2 will refer all opportunities that come to its attention where the Bio-Extraction Process or the Quinlan Feedstock could be a viable solution exclusively to the JV.
Global Omega-3 Market
Omega-3 polyunsaturated fatty acids (PUFAs) such as eicosapentaenoic acid (EPA) and docosahexaenoic acid (DHA), are regarded as beneficial for preventing and treating a number of health conditions ranging from cardiovascular disease to autoimmune diseases and mental health disorders (Shahidi & Miraliakbari, 2004, 2005) and, recently, to inhibit the development and growth of breast cancer tumours (MacLennan et al, 2013). Omega-3 PUFAs have anti-inflammatory, anti-thrombotic, anti-arrhythmic, hypolipidemic and vasodilatory properties (Simopoulos, 2007). EPA and DHA from fish oil have been shown in clinical studies to help support cognitive health, brain function (Haag, 2003), cardiovascular health (Kris-Etherton, Harris, & Appel, 2003; Oh, 2005), to help reduce serum triglycerides (Sirtori et al., 1998) and, in conjunction with conventional therapy, to help reduce the pain of rheumatoid arthritis (Volker, Fitzgerald, Major, & Garg, 2000).
The supply of omega-3 has traditionally come from fish oils and other marine based sources such as krill, and from commercial microalgae production. The global market for omega-3 in 2011 was estimated at $25 billion with a 2016 forecast of $34 billion according to the food industry market research company, Packaged Facts.
"We are pleased to have entered into this JV with S4CO2. It offers an environmentally friendly revenue stream from our shrimp by-product," said Robin Quinlan, Vice President of Quinlan Brothers.
"We are delighted to be partnering with not only one of Canada's largest shrimp processors, but also a leading innovator in the use of all the components of their shrimp catch," said Randy Uens, VP Global Sales and Marketing of S4CO2 and President of the JV.
Global Demand for Astaxanthin
Astaxanthin has recently been identified as a powerful antioxidant and is quickly becoming a popular health supplement with the potential to prevent and treat several health conditions including neurodegenerative diseases (Nakagawa et al, 2011), diabetes (Naito et al, 2004), stress, inflammation and cardiovascular disease (Fassett & Coombes, 2009). It can also be used to improve the efficacy of muscle endurance, joint health, eye health and skin health (Keisuke et al, 2002).
The market for nutraceutical grade astaxanthin was estimated to be nearly $60 million in 2011 and is expected to grow to over $200 million by 2015 according to data from Frost & Sullivan.
Global Cold Water Shrimp Industry
Six species of cold water shrimp are caught in northern latitudes in the Atlantic and Pacific oceans. According to the Food and Agriculture Organization (FAO), cold water shrimp account for roughly 7% or 450,000 MT of the total global shrimp production of 6 million MT. Canada and Greenland account for an estimated 70% of global cold water shrimp landings followed by Norway and Iceland. This results in an estimated cold water shrimp by-product volume of well over 150,000 MT from Canada and Greenland.
In 2008, the northern shrimp fishery in eastern Canada received Sustainable Fishing Certification from the Marine Stewardship Council (MSC), an organization established in 1999 to improve the health of the world's oceans and create an international market for sustainable sea products. MSC certification represents a major accomplishment since harvesting northern shrimp is now recognized as sustainable throughout the world. This is the first Canadian fishery to obtain MSC certification.
About Solutions4CO2 Inc.:
Solutions4CO2 is a Canadian company that develops innovative waste-gas, water, biomass to high-value co-product solutions using proprietary and licensed technologies under the trademarks "Integrated Biogas Refinery ("IBR") and Bio-Extraction Process ("BEP"). The IBR integrates best in class technologies to convert various organic waste streams into high-value algae co-products. The BEP utilizes supercritical CO2 fluid extraction to extract and fractionate high-value co-products from shrimp by-products. Solution4CO2's business model allows the company to participate in joint-venture projects with partners across the waste-to-high-value co-product value chain, or sell projects on a design, build, operate and maintain basis.
About Quinlan Brothers Ltd.:
Quinlan Brothers Ltd. is a Canadian processor of cold water shrimp and snow crab at its plant located at Bay de Verde, Newfoundland and Labrador.
This news release may contain forward-looking statements that are based on Solutions4CO2's expectations, estimates and projections regarding its business and the economic environment in which it operates. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements and readers should not place undue reliance on such statements. Statements speak only as of the date on which they are made, and the Company undertakes no obligation to update them publicly to reflect new information or the occurrence of future events or circumstances, unless otherwise required to do so by law.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
VP Global Sales and Marketing