Stratos Renewables Energy Corp. has a two phase plan to dominate the sugarcane ethanol market in Peru, with intentions to become the lowest cost and leading producer of sugarcane ethanol in the region. The company plans to take advantage of the locally grown sugarcane feedstock, as well as the country's free trade agreements with the United States and Canada to reach its goals.

The first phase calls for the expansion and operation of ethanol production facilities. This includes developing the proper infrastructure, as well as a modernized and expanded mill and distillery. In September 2007, Stratos acquired the Estrella del Norte mill in Peru. The company is relocating and expanding the mill to boost its milling capacity to 360,000 tons of sugarcane annually, which results in the production of 20 million liters of ethanol each year.

Stratos also plans to establish a seeding nursery as part of phase I, and has launched a seedling program to evaluate the best suited sugarcane plantlet for the highest yield possible. To meet phase II operations, the company plans to acquire 48,000 ha land holdings, which calls for the expansion of development and operations in strategic locations along the Peruvian coast.

Stratos intends to develop two greenfield sugar mills and distilleries, cultivating its own sugarcane on 24,000 ha of land. The company anticipates the operation of its mills and distilleries to produce about 180 million gallons of ethanol each year by the fourth quarter of 2014.

The price tag is unsurprisingly quite high, but the company has already secured $11.6 million in private financing. It has also entered lease agreements for the needed land, initiated its first sugar mill conversion, and has entered into agreements with Biotecnologia for the seedling laboratory, as well as with RNK Capital for the sale of future carbon credits.

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