SHERIDAN, Wyo., May 20, 2011 — Next Fuel, Inc. (OTCQB:NXFI) announced that it has signed a definitive agreement with San Ding Jiu Yuan (DBA “Future Fuel”) to field test Next Fuel‟s Coal to Gas technology (“CTG Technology”) in Inner Mongolia, People’s Republic of China, to determine the commercial viability of utilizing it to produce natural gas from lignite coal deposits. The two companies also agreed to negotiate a strategic arrangement for the entire China market, if field tests are positive.
The company also announced that persons affiliated with Future Fuel made the second part of a $2 million strategic investment in Next Fuel and now own 1 million shares of common stock, which exceeds 10% of Next Fuel’s outstanding shares and a representative of the investor group joined the Board of Directors.
Field testing is scheduled to begin by the end of July 2011. If the field tests are successful, the parties intend to negotiate a definitive long term license agreement.
Robert Craig, Chairman and CEO of Next Fuel, Inc., stated, “China is the largest producer of coal in the world. Our partner, Future Fuel, has access to lignite coal deposits in Inner Mongolia and views our CTG Technology as a potential breakthrough method to monetize these lignite assets by converting dirty “brown coal‟ into natural gas, the cleanest burning fossil fuel. Future Fuel management has extensive experience, and success, in the coal business in Asia.
“We welcome Mr. Guangwei Guo to our Board of Directors. His experience in the China coal market will add value to our business and will help ensure close cooperation between the two companies.”
Mr. Craig continued, “With pilot agreements in Indonesia and now China, Next Fuel has field tests commencing in two areas with significant under utilized coal resources, which positions us favorably as we look to evolve from the research and development stage to commercialization.”
Shares issued in the investment are subject to contractual lock-up restrictions and regulatory restrictions on re-sales. Future Fuel will have the right to require Next Fuel to file a registration statement with the Securities and Exchange Commission to register its shares for resale within sixty (60) days.
Both commercial and investment agreements are described in greater detail in filings with the Securities and Exchange Commission.
About Next Fuel, Inc.
Next Fuel has developed and is commercializing Coal to Gas technology. Next Fuel’s technology accelerates the creation of natural gas from coal, lignite and oil shale, thereby enabling owners of low grade coal fields the opportunity to monetize their asset by efficiently producing natural gas, and owners of higher grade coal beds the chance to enhance and resume commercial scale natural gas production from declining and/or depleted coal bed natural gas wells.
This announcement contains forward-looking statements, including statements regarding future business to be conducted by the Company in China and, all of which involve risks and uncertainties. Actual results could differ materially from those discussed. Factors that could cause or contribute to such differences include, but are not limited to, the results of field tests, receptiveness of the market to the Company’s technology and services, negotiations between the Company and its Chinese partners services and other factors discussed in our filings with the Securities and Exchange Commission. All forward-looking statements are based on information available to us on the date hereof, and we assume no obligation to update such statements.
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