Interline Resources Corp. Signs Exclusive Licensing Agreement for Contaminated Oil Reprocessing Technology

Strategic Insights -

Interline Resources Corp., a diversified oil and natural gas company, has signed a significant licensing agreement with Gadgil Western Corp. (formerly Western India Group) for the exclusive use of its contaminated oil reprocessing technology in Bahrain and Singapore. This agreement marks a major milestone for both companies, with Gadgil Western agreeing to pay Interline $1 million by August 31, 1995, as part of the licensing deal. The technology, which has already been successfully implemented in a refinery in Dubai, United Arab Emirates, allows for the upgrading of low-value, heavy refinery hydrocarbons to middle distillates, such as gasoline and diesel fuels.

Key Takeaways:

  • Interline Resources Corp. has signed an exclusive licensing agreement with Gadgil Western Corp. for its contaminated oil reprocessing technology in Bahrain and Singapore.
  • Gadgil Western Corp. has agreed to pay Interline $1 million by August 31, 1995, as part of the licensing deal.
  • The technology has already been implemented in a refinery in Dubai, United Arab Emirates, with a capacity of about 13 million gallons per year.
  • Gadgil Western Corp. intends to use the technology in an 82 million gallon per year refinery in Bahrain and a 165 million gallon per year refinery in Singapore.
  • The royalties from these plants would contribute to the anticipated $6 million per year royalties announced in June.
  • The licensing agreement brings the total number of countries in which Gadgil Western Corp. can exclusively use Interline's technology to 12.
  • In December 1993, Interline signed a licensing agreement with Gadgil Western for 10 Middle Eastern and Far Eastern countries.
  • In March 1995, Interline granted stock options to Gadgil Western for 888,889 shares of Interline common stock exercisable at $4.50 per share.
  • Gadgil Western has exercised 288,888 shares of the options, which include the options that would have expired by June 30, 1995.
  • Interline owns a patented technology for processing and cleaning contaminated hydrocarbons, including crank case oil, refinery bottoms, waste crude streams, and other heavy oils.

Statistics:

  • 12 countries in which Gadgil Western Corp. can exclusively use Interline's technology.
  • $1 million paid by Gadgil Western Corp. to Interline as part of the licensing deal.
  • August 31, 1995, the deadline for Gadgil Western Corp. to pay the $1 million licensing fee.
  • 13 million gallons per year, the capacity of the Interline refinery in Dubai, United Arab Emirates.
  • 82 million gallons per year, the capacity of the refinery in Bahrain.
  • 165 million gallons per year, the capacity of the refinery in Singapore.
  • $6 million per year, the anticipated royalties from the plants in Bahrain and Singapore.
  • 888,889 shares, the number of stock options granted to Gadgil Western Corp. in March 1995.
  • 288,888 shares, the number of stock options exercised by Gadgil Western Corp.
  • $4.50 per share, the exercise price of the stock options.
  • 66,667 shares, the number of stock options that will expire each month from August 1995 to March 1996.

Sources:

  • Press Release, Interline Resources Corp., "Interline Resources Corp. Signs Exclusive Licensing Agreement for Contaminated Oil Reprocessing Technology," July 26, 1995.
  • PRNewswire, "Interline Resources Corp. Signs Exclusive Agreement with Gadgil Western Corp.," July 26, 1995.
  • Interline Resources Corp. press release, "Gadgil Western Corp. Exercises Stock Options," March 1995.