Delorean (ASX:DEL) entered into a binding long-term agreement with Supagas for the supply of biogenic food-grade liquid carbon dioxide, according to a Monday Australian bourse filing.
The carbon dioxide will be produced from Delorean's SA1 bioenergy facility in South Australia, which is currently under construction.
The facility will process 70,000 tonnes per annum of commercial and municipal organic waste diverted from landfills, using anaerobic digestion to produce biogas for renewable electricity and gas.
Liquid carbon dioxide will be produced as a byproduct of the conversion of biogas to biomethane for injection into the gas network.
The agreement is subject to the firm's final investment decision on the installation of biomethane upgrade and carbon dioxide processing equipment at the facility.
Delorean and Supagas will equally share any carbon credits generated from the production of the biogenic liquid carbon dioxide.
The firm's shares rose 11% in recent trading on Monday.
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