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Press Release

Lignol Project Awarded $2.06 Million in Additional Funding from SDTC

Canada NewsWire

VANCOUVER, Feb. 7, 2012 /CNW/ - Lignol Energy Corporation (TSXV: LEC) ("Lignol" or "the Company"), a leading technology company in the advanced biofuels and renewable chemical sector, today announced that a project led by its wholly-owned subsidiary, Lignol Innovations Ltd., has been awarded up to $2.06 million in additional funding contributions from Sustainable Development Technology Canada ("SDTC").

"Our Government is committed to supporting clean technology in Canada as an effective measure to reduce greenhouse gas emissions and create high-quality jobs for Canadians," said the Honourable Joe Oliver, Minister of Natural Resources. "This project demonstrates our leadership in driving clean technology innovation to help create viable new industries for Canada's economy."

"Lignol has a proven track record of innovation, a trend that will be made stronger with this new investment," said SDTC President and CEO Vicky J. Sharpe. "It is innovation like this that brings Canada ever closer to using key resources sustainably and creating the next generation of biofuels."

This award is in addition to the $4.72 million awarded to date from SDTC's SD Tech Fund™, representing an aggregate contribution to Lignol from SDTC of up to $6.78 million.  The duration of the current work plan, that commenced September, 2009 with the support from SDTC, will be extended until Q3 2013 with an overall total project cost estimated to be $20.4 million. The original project resulted in the establishment of a world-class integrated industrial scale facility for the production of cellulosic ethanol and unique renewable biochemicals. The additional scope of the project will result in further enhancement to Lignol's biorefinery technologies, focusing on greater utilization of hemicellulose-derived sugars and demonstration of industrial, value added applications for Lignol's high performance lignin ("HP-L™ Lignin") in the plastics and materials industries.

"The additional funding from SDTC is an important contribution that will enable us to enhance the economic viability of our biorefinery technologies, while maintaining significant GHG reduction benefits," said Ross MacLachlan, President and CEO of Lignol. "These enhancements will allow smaller, higher-yield biorefineries to be built with strong regional demand for Lignol's bioproducts, resulting in a more rapid and more diverse deployment of this transformative technology."

About Sustainable Development Technology Canada (SDTC)
SDTC is an arm's-length corporation created by the Government of Canada as part of the Government's commitment to create a healthy environment and a high quality of life for all Canadians. SDTC operates two funds aimed at the development and demonstration of innovative technological solutions. The $590 million SD Tech Fund™ supports projects that address climate change, air quality, clean water, and clean soil. The $500 million NextGen Biofuels Fund™ supports the establishment of first-of-kind large demonstration-scale facilities for the production of next-generation renewable fuels. SDTC operates as a not-for-profit corporation and has been working with the public and private sector including industry, academia, non-governmental organizations (NGOs), the financial community and all levels of government to achieve this mandate.

About Lignol
Lignol (TSXV: LEC) is a Canadian company undertaking the development of biorefining technologies for the production of advanced biofuels, including fuel-grade ethanol, and other renewable chemicals from non-food cellulosic biomass feedstocks. Lignol's modified solvent based pre-treatment technology facilitates the rapid, high-yield conversion of cellulose to ethanol and the production of value-added biochemical co-products, including high performance HP-L™ lignins. HP-L™ lignin represents a new class of high purity lignin extractives (and their subsequent derivatives) which can be engineered to meet the chemical properties and functional requirements of a range of industrial applications that until now has not been possible with traditional lignin by-products generated from other processes. Lignol is executing on its development plan through strategic partnerships to further develop and integrate its core technologies on a commercial scale. Lignol also intends to invest in, or otherwise obtain, equity interests in energy related projects which have synergies with its biorefining technology. For more information about Lignol, visit

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Caution concerning forward-looking statements:
Certain statements contained in this document may constitute forward-looking information within the meaning of applicable securities laws. Such forward-looking statements or information include, without limitation, statements or information about our ability to continue as a going concern and to raise additional financing to fund operations, our ability to complete the related work programs in respect of the project which is to be supported with additional funding from SDTC, and our ability to receive in full such additional funding related to this award, our ability to work with CIBC and Capital West to consider a range of sources of investment, including industry and financial investors who have a strategic, long term interest in advanced biofuels, renewable chemicals and forest industry transformation, our ability to successfully defend our patents and patent applications and to receive approval for the claims submitted in multiple jurisdictions, the development status of our fully integrated pilot-scale biorefinery in Burnaby, British Columbia, the planning and development of a commercial plant, our ability to exploit commercial opportunities and broaden our market opportunities for a range of cellulosic derivatives and environmentally sustainable biochemicals including our HP-L™ lignin and lignin derivatives, our ability to produce HP-L™ lignin that meets agreed customer specifications at commercial scale, and our ability to pursue these opportunities with strategic partners including establishing off-take agreements for our products and our ability to obtaining strategic partnership investments and government funding for initial commercial projects.  Often, but not always, forward-looking statements or information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes" or variations of such words and phrases or words and phrases that state or indicate that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Such statements or information reflect Lignol's current views with respect to future events and are subject to certain risks, uncertainties and assumptions including, without limitation, the technological challenges that remain to be surpassed in obtaining the necessary operating data from our pilot scale biorefinery that is required prior to completing the next scale-up of the technology, our ability to successfully scale our technology, our ability to successfully defend our current patent applications and to secure issued patents in respect of those claims in multiple jurisdictions, our ability to satisfy the conditions of existing government grants and to obtain new additional grants, the timely receipt of funding under various government awards and corporate contribution agreements, our ability to continue to finance our Baseline Operations and to finance and complete the development of a commercial demonstration plant, our ability to develop commercial products in collaboration with industry partners, our ability to obtain requisite regulatory approvals and our ability to enter into agreements with strategic partners on terms acceptable to us. Forward-looking statements and information are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies, and changes in government regulation. Many factors could cause Lignol's actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements or information, including among other things, the technological challenges that remain to be surpassed in obtaining the necessary operating data from our fully integrated biorefinery pilot plant that is required prior to completing the next scale-up of the technology, financial market conditions which will impact our ability to finance our operations and to finance the construction and operation of a commercial plant, the price of gasoline and demand for ethanol, the market pricing and demand for renewable chemicals, risks relating to the protection of Lignol's core technology from infringement and those risk factors which are discussed elsewhere in documents that Lignol files from time to time with securities regulatory authorities. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements or information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Except as required by law, the Company expressly disclaims any intention or obligation to update or revise any forward looking statements and information whether as a result of new information, future events or otherwise. All written and oral forward-looking statements and information attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements.