Agritrade Resources : Announcements and Notices - Update on the Biodiesel Operation in the Usa

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

(Incorporated in Bermuda with limited liability)

(Stock Code: 1131)

This announcement is made by Agritrade Resources Limited (the "Company", together with its subsidiaries, collectively referred to as the "Group") on a voluntary basis to provide the shareholders and potential investors of the Company with the latest information on the recent development of the renewable energy business of the Group.

Reference is made to the announcements (the "Announcements") of the Company dated 14 December 2016 and 28 June 2017 in relation to the completion of the acquisition of the Biodiesel Plant located in Arkansas, the USA, on 14 December 2016 by the Company's 51%-owned subsidiary at a consideration of US$2.97 million and the commencement of the trial production of the Biodiesel Plant in June 2017. Terms used herein shall have the same meanings as those defined in the Announcements unless otherwise stated.

The Board is pleased to announce that following the commencement of trial production of the Biodiesel Plant in June 2017, it has started the sourcing of feedstock since June 2017 and the Biodiesel Plant has made its first delivery of biodiesel to major oil and gas trader customers located in the USA since September 2017 with its initial commercial sales being recorded in September 2017.

The maximum production capacity of the Biodiesel Plant is expected at 40 million gallons annually and the Biodiesel Plant is in the course of ramping up its current production capacity. The Board expects that upon the ramp-up of capacity, the Biodiesel Plant can reach 60% of its full production capacity in October 2017 and it can further achieve an 80% capacity utilization rate by the year 2018.

The Biodiesel Plant will continue to source feedstock and make sales of biodiesel to other sizeable customers in the USA in the second half of the financial year ending 31 March 2018, with further growth in production capacity and turnover thereafter expected. It is also the intention of the Biodiesel Plant to enter into major long-term contract(s) with biofuel leader(s) in the USA for its biodiesel. As at the date hereof, such discussion and negotiations are still at a preliminary stage and no final terms and conditions have been concluded. Further announcement(s) will be made by the Group in compliance with the Listing Rules to inform the shareholders of the Company in relation to the status of these contract(s) as and when appropriate. The Board believes that the production of the Biodiesel Plant will cater to the increasing demand for renewable energy in the USA market and will have positive contribution to the Group's overall turnover and performance for the coming years.

Hong Kong, 25 September 2017

As at the date of this announcement, the Board comprises Mr. Ng Say Pek (Chairman), Mr. Ng Xinwei, Ms. Lim Beng Kim, Lulu and Mr. Ashok Kumar Sahoo as executive Directors and Mr. Chong Lee Chang, Mr. Siu Kin Wai, Mr. Terence Chang Xiang Wen and Mr. Cheng Yu as independent non-executive Directors.