Stratos Renewables Corp. (SRNW.OB) views the biofuels market as an underserved but addressable market. The Peruvian government recently mandated that by 2010, 7.8 percent of gasoline include ethanol. The U.S. Renewable Fuel Standard is calling for 36 billions of renewable fuels by 2022. Despite the mandates and the obvious need for cleaner-burning fuels, production has fallen short of staying on track to meet these requirements.
Stratos intends on boosting production through its operations along the coast of Peru, which offers year-round harvest and low export transportation costs. Though Brazil has taken the lead in sugarcane ethanol production, Peru offers a tax-free trade, as compared to Brazil's 54 cents per gallon tariff. This is ideal for Stratos, as it eyes the United States as a primary market because of its close proximity to Peru and environmental advantages.
Stratos intends on executing its planned two-phase production and expansion strategy to nix fluctuating prices while delivering competitively high yields. The company has already acquired a sugar mill, The Estrella del Norte, and has launched operations to modify and relocate the mill for maximum production capacity.
The company estimates that its operations could create more than 2,000 jobs, as there is no other mass ethanol production or operation in Peru. The company is networking, leveraged by its business model, to attain the land needed to carry out its sugarcane-based ethanol production facilities.
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