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D1 Oils Plc (NEOS)

  Print      Mail a friend       Annual reports

Tuesday 31 May, 2005

D1 Oils Plc

Prelim results and Placing

D1 Oils Plc
31 May 2005



                                  D1 Oils plc

Preliminary Results for the year ended 31 December 2004 and Placing of 9,732,617
                   New Ordinary Shares raising £25.8 million

D1 Oils plc ('D1 Oils'), the UK-based global low cost producer of biodiesel,
announces its results for the year ended 31 December 2004 and Placing of
9,732,617 New Ordinary Shares at a price of 265p (the 'Placing'), raising funds
of £25.8 million (gross of expenses).

D1 Oils is expanding its operations in new and existing territories to meet the
increasing scale of opportunity in the biodiesel market. The net proceeds of the
Placing of £24.3 million will be used to leverage these opportunities and meet
the growing demand for biodiesel as a sustainable renewable fuel resource,
assisting D1 Oils in its objective to become a leading producer of biodiesel and
related feedstocks.

Results and Placing:

   • Net proceeds from Initial Public Offering in October 2004 were £11.5m
   • Operational expenditure was in line with expectations, despite
     acceleration in D1 Oils' business plans leading to loss on ordinary
     activities before taxation for the year ended 31 December 2004 of £3.1m
   • Cash balance was £9.6m on 31 December 2004
   • The Placing announced today raised £24.3 million (net of expenses)
   • 9,732,617 New Ordinary Shares have been placed at a price of 265p per
     Ordinary Share

2004 and Q1 2005 operational highlights:

   • Indian joint venture company, D1 Mohan Bio Oils Limited, expanded its
     initial planting target of 5,000 hectares to 100,000 hectares
   • Joint venture with Jazeera Modern Technology of Saudi Arabia announced
     to oversee planting of 5,000 hectares and up to 100,000 hectares of 
     Jatropha in the desert outside Riyadh
   • Secured £25 million of third party financing for D1 Oils' global
     operations
   • Current specification of D1 20 refinery successfully completed its 24/7
     test
   • Original planting programme expanded to cover in excess of 267,000
     hectares, a seven fold increase over the 37,000 hectares of land stated in
     D1 Oils' Admission document
   • D1 Oils intends to deploy up to 9 D1 20 refineries by the end of 2006 as
     against a previous target of 3 stated in its Admission document


New developments not previously announced:

D1 Oils also announces today details of new joint ventures in China and Saudi
Arabia highlighting the additional global opportunities D1 Oils is pursuing.

   • In China, D1 Oils has entered into a conditional 50 year joint venture
     agreement with Sichuan Yangtze River Technology Company Limited, Chengdu, 
     to develop a Jatropha biodiesel refining and feedstock supply business for 
     the Chinese and International markets with a target of producing 500,000 
     tonnes per annum from the region as soon as practical. A minimum of 150,000
     hectares and up to 2 million hectares of land is to be procured for the
     project
   • In Saudi Arabia, D1 Oils has entered into a strategic alliance agreement
     with Abdullatef Al-Rajhi International Group for the design, development 
     and implementation of waste water management facilities and infrastructure 
     for the reclamation of up to 300,000 hectares of land suitable for 
     producing Jatopha crops


Current trading and Outlook

Since the financial year-end, D1 Oils' business has continued to trade in line
with the Directors' expectations and the Board remains confident about the
prospects of D1 Oils during 2005. Certain key business goals have been
accelerated, including the extension of planned planting programmes and
expansion of D1 Oils' operations in existing and new territories. D1 Oils will
continue to implement and execute its business plan and will continue to
strengthen the security of its supplies by expanding its portfolio of sources of
oil.

Commenting on the results and Placing, Karl Watkin, Chairman of D1 Oils said:

'I am pleased to be able to report that D1 Oils is making excellent progress and
has accelerated certain key components of its business plan. D1 Oils has further
increased its opportunities worldwide as the market is getting stronger, partly
through Kyoto and International government policy initiatives, giving us the
opportunity to gain a further competitive advantage in key markets. The Placing
announced today will help D1 Oils to secure a leadership position through
enabling the company to pursue a more aggressive expansion policy and is a key
step towards our objective of becoming a leading sustainable global low cost
producer of biodiesel.'

Philip Wood, Chief Executive of D1 Oils said:

'The Placing and new joint ventures announced today will enable us to expand
much more rapidly. We have increased our total planting targets seven fold since
last October. We expect China and India to be two of the largest markets in the
world for biodiesel. In addition to the expansion of our business in India where
planting targets have increased twenty fold, we now have an exciting new joint
venture in China with the potential to put us in a market leadership position.
Mirroring the substantial increase in our capacity to produce oil bearing seeds,
we intend to significantly expand our access to refining capacity, including
increased deployment of our proprietary D1 20 refining technology.'

Enquires:
D1 Oils plc        Karl Watkin, Chairman                020 7321 3885
                   Philip Wood, CEO
Brunswick          Gill Ackers                          020 7404 5959
                   Kevin Byram
                   Anisha Patel

Notes to editors:
D1 Oils plc is the owner of technical, marketing, logistical and other
intellectual property related to the establishment, development and harvesting
of jatropha plantations, the extraction of oil from the harvested seed and the
production of biodiesel and other valuable by-products from the vegetable oil.


Background to and reasons for the Placing

D1 Oils was admitted to trading on AIM in October 2004 with the principal
objective of becoming a leading, sustainable, global, low cost producer of
biodiesel and related feedstocks. Since the publication of the Admission
Document, there has been a demonstrable escalation in activity in the renewable
energy sector generally and, more specifically, heightened awareness of
corresponding key global policy drivers and legislative changes. The Company
continues to monitor the rapidly evolving, emerging global biodiesel market and
has identified a number of potentially significant commercial opportunities of
which it wishes to take immediate advantage.

Since Admission, the emerging global biodiesel market has been reinforced by
several key events and related policy initiatives. The Kyoto Protocol came into
force on 16 February 2005 and its agreed mechanisms and corresponding targets
are now capable of being enforced. EU countries are continuing to implement the
European Biofuels Directive, which has set indicative targets for a minimum
level of biofuels (5.75 per cent. by 2010). A number of European countries are
in the process of discussing, or have already implemented, fuel duty exemptions
for the use of biofuels. The Directors believe that these initiatives and
mechanisms, combined with a higher global price of mineral-based oil and the
move by a number of other non-EU countries towards setting biofuels targets and
tax exemptions, are creating substantial continued global interest in the
renewable fuels market.

The Company now wishes to raise additional finance to expand its existing
capital base to implement a number of specific projects and initiatives, taking
advantage of the increasing global acceptance of biodiesel as a sustainable
renewable fuel resource. The Company announces today that it proposes to raise
approximately £25.8 million (before expenses) by the Placing of 9,732,617 New
Ordinary Shares at a price of 265p per Ordinary Share.

Since the Company's admission to AIM, the Directors have accelerated certain key
components of the business strategy in order to exploit available opportunities
and further enhance the Group's competitive advantage. Substantial progress is
being made, consistent with the Group's phased roll-out strategy, including the
following:

   • strategic joint ventures and commercial relationships
     D1 Oils Trading has established, in both new and existing territories,
     additional strategic joint venture arrangements and commercial 
     relationships, expanding the Group's plantation rights, land portfolio and 
     global operational presence.

   • planting programme
     the existing planting programme (including that of its joint venture 
     companies) has been expanded to cover in excess of 267,000 hectares of land 
     (to be planted by the fourth quarter of 2006), a seven fold increase over 
     the 37,000 hectares of land stated in the Admission Document. The Group 
     (including its joint venture companies) has also now secured options to 
     contract over a total of approximately 9.2 million hectares of land 
     (subject, generally, to the successful completion of initial plantation 
     projects). This is an increase of approximately 3.3 million hectares of 
     land, almost 56 per cent. over the original amount of 5.9 million hectares 
     of land under option as at the date of the Admission Document.

   • crude oil supply contracts
     D1 Oils Trading has negotiated further 10 year oil purchase contracts and
     commercial arrangements for the delivery of up to 78,000 tonnes per annum 
     of crude Jatropha oil (more than triple the original 24,000 tonnes per 
     annum stated in the Admission Document) from third parties in India and 
     Africa (approximately 29,000 hectares equivalent), with first delivery 
     expected during the course of the fourth quarter of 2005. The Group 
     currently intends to either transport this crude Jatropha oil to its 
     UK refinery operation or those operations expected to be commissioned 
     during the course of 2005 in Port of Durban, South Africa and Port of 
     Chennai, India.

   • research and development activity
     D1 Oils Trading has expanded and invested in research and development 
     activities designed to enhance quality and performance across the supply 
     chain, from initial cultivation through to biodiesel production.

   • D1 20 refinery
     D1 (UK) has continued the successful on-going testing of the Group's D1 20
     modular, refining technology. In particular, the company has accelerated 
     the development programme in order to enable the refinery to process a 
     broader range of type and quality of oil. Over the course of the next 
     18 months, the Group (including its joint venture companies) intends to 
     install up to 9 D1 20 refineries (as against the 3 D1 20 refineries stated 
     in the Admission Document).

   • financing arrangements
     D1 Oils Trading (or certain of its joint venture companies) has obtained 
     third party equity investment or financing arrangements (totalling 
     approximately £25 million) with banks and commercial partners.

Target markets and operations

The Group has substantially developed and progressed its activities within the 4
regions of Africa, Asia Pacific, Europe and India (in which it operated at the
time of the publication of the Admission Document) and has established a number
of new operations, strategic alliances and commercial relationships, principally
in China and the Middle East. A number of the Group's more significant
developments are set out in detail below.

Africa

On 19 January 2005, D1 Oils announced that it had identified approximately
17,000 hectares of existing Jatropha plantations in Madagascar and was in the
process of making arrangements to access the output from these plantations.
These Jatropha trees, currently used as supports for growing vanilla, are
already yielding seeds and the Directors expect the harvesting of this crop to
begin during December 2005.

In addition, D1 Oils is in the process of agreeing contracts with several farmer
associations and NGOs whereby stand alone Jatropha plantations will be developed
in up to five regions within Madagascar. The Group's target is for a minimum of
5,000 hectares to be planted in each of these regions during the course of the
next 18 months and for a total of up to 200,000 hectares to be planted during
the course of the next five years. Initial planting will commence in two regions
during the course of the second half of 2005. D1 Oils intends, subject to
agreement of acceptable commercial terms and appropriate fiscal incentives, to
introduce refining operations as soon as practical utilising its proprietary D1
20 refinery technology. The Directors anticipate that crude Jatropha oil not
required for local refining will be exported.

On 22 February 2005, the Company announced that it had agreed terms with
Rolls-Royce to provide a US$1  million finance facility for the D1 20 refinery
(to be located in the Port of Durban, South Africa) which is expected to be
built and fully operational by the end of 2005. The Directors continue to
believe that such arrangements are an attractive method of financing and
expanding the Group's (including its joint venture companies) portfolio of
refineries.

The Company has reviewed its commercial activities in Burkina Faso and now
proposes to expand the scope of operations through a joint venture between D1
Oils Trading and Biodiesel Corporation. The parties are still in negotiations as
to the precise detail, including their respective equity participations. Should
these negotiations not be concluded, the Company's Burkina Faso operations will
continue on the basis as previously agreed and described in the Admission
Document. Further details of the proposed joint venture are set out below in
detail in the section headed 'Current developments'.

The Company is currently in the process of setting up D1 Oils Ghana in order to
assist with the restructuring of existing Ghanaian operations. On completion of
the restructuring, the Directors believe that title to identified land which is
being developed to grow Jatropha, including the existing 12,000 hectare pilot
project, will be transferred to the Group whereby the entire farm management and
production process is controlled, managed and operated direct by the Group. The
Directors are confident that this would result in greater returns on D1 Oils'
investment, enhanced flexibility and improved control over the project and
expect that seed planting will commence in June 2005.

India

On 19 November 2004, the Company announced that Jatropha trees owned by the
Coimbature Jatropha Producers Association ('CJPA'), grown on 300 hectares in
Tamil Nadu had reached oil bearing stage within a year of planting, more than
six months ahead of expectation. The Directors consider it to be best practice
to prune the trees to encourage further growth, particularly in order to
increase seed productivity, and not to harvest these initial oil bearing seeds.
Accordingly, the Directors continue to anticipate that the first commercial
harvests of oil bearing seeds on D1 Oils' plantations (or those of its joint
venture companies) will be, on average, within a period of approximately 24
months from first planting. The Group is also entering into a research and
development project with the CJPA in terms of which the parties are in the
process of establishing a 250 hectare model farm, a 5 hectare pilot plantation
and training centre in the region.

D1 Oils announced, on 24 January 2005, that D1 Mohan had increased its 2005
planting target from 5,000 to 100,000 hectares. D1 Mohan also reconfirmed its
cumulative target of 5 million hectares to be planted over the course of the
next 5 years. The Directors anticipate that, on maturity, this initial 100,000
hectare plantation project could yield approximately 270,000 tonnes of crude
Jatropha oil per annum. The Company now has the option to export 25 per cent. of
the crude Jatropha oil produced by D1 Mohan for sale to international customers
or refining in its own D1 20 refineries. Previously, all crude Jatropha oil
produced by D1 Mohan was to be retained for domestic biodiesel production. D1
Mohan intends to commission at least one D1 20 refinery, at the Port of Chennai,
India, during the course of the second half of 2005.

On the same date, the Company also announced new third party off-take agreements
for the supply of crude Jatropha oil through to 2015. D1 Oils Trading has also
entered into a number of 10 year crude Jatropha oil supply agreements with
independent contractors who will be responsible for planting, maintenance,
harvesting, expelling, crushing and delivery of the resulting crude Jatropha oil
to D1 Oils Trading. The Company anticipates that these new contracts will
provide an additional 10,000 tonnes per annum of crude Jatropha oil for export
during the course of 2006, rising to approximately 50,000 tonnes per annum
during the course of 2009.

On 14 April 2005, the Company announced that D1 Mohan had signed a memorandum of
understanding with the State Bank of India ('SBI') to provide a 1.3 billion
Indian Rupees non-recourse finance facility (approximately £15 million) to local
farmers in Tamil Nadu to facilitate the planting of up to 40,000  hectares of
Jatropha. D1 Mohan will purchase the harvested seeds and payments will be
released to the local farmers following deduction of SBI's repayment
instalments. At the time of its admission to AIM, D1 Oils assumed that
proprietary seed and growing medium supplies would be provided at D1 Oils' cost.
However, with the availability of these types of banking facilities, the farmers
are now purchasing these supplies. This development provides D1 Mohan with
additional revenue and enables the business to expand more rapidly as the
working capital requirements for each hectare are reduced. D1 Mohan is currently
in discussions regarding similar funding arrangements in respect of the
remaining 60,000 hectares of this initial project.

Asia Pacific

The Board's strategy in this region has evolved whereby the Group intends, prior
to the commencement of larger scale plantations (including the 10,000 hectare
inter-cropping project detailed in the Admission Document), to initially promote
the establishment of model farms. The Directors are confident that this will
demonstrate the physical characteristics of Jatropha and intend to launch a
visible training and marketing centre to raise regional crop awareness. To date,
four model farms (generally over approximately 5 hectare sites) are being
established in different regions of The Philippines by stakeholders who include
government, industry and agriculture groups. In addition, the Group is
continuing to negotiate with relevant third parties and seek strategic partners
to help it secure and develop more significant areas of land for larger Jatropha
plantations.

The Philippines Coconut Authority continues to be committed to the original
10,000 hectare project. However, the parties have verbally agreed to modify the
original agreement such that a full scale planting programme will not commence
until the initial model farm projects have created greater regional awareness of
the characteristics and potential commercial benefits of Jatropha. The initial
D1 20 refinery intended to be installed in the Port of Subic Bay, The
Philippines, during the course of 2005, will now be commissioned when sufficient
volumes of feedstock are available to be processed.

On 5 May 2005, the Company announced that D1 Oils and Atlas Mines Corporation
('Atlas Mines'), an established mining and resource company based in The
Philippines, had agreed to undertake an initial study in order to assess the
possibility of planting Jatropha on the company's mining sites and producing
biodiesel, on site, using the D1 20 refining technology. The project will
utilise bioremediation, a means of restoring soil that has suffered erosion and
pollution in the mining process, by using Jatropha to help replace lost
nutrients. The President of The Philippines planted the first seedling at the
project site in Toldeo, Cebu Province. If the results of the study are positive,
a model farm will be established within the course of the next 6 months and,
thereafter, a seed bank. Atlas Mines has agreed to fund the entire costs of this
initial project. In addition, Atlas Mines has already identified an initial
7,000 hectares of degraded land where Jatropha will be planted in order to
produce fuel for power generation to operate off-grid mining facilities.

The Group has also identified Thailand as an attractive market within the Asia
Pacific region which has the additional benefit of well established government
policies supporting the development of biofuels. The Thai Ministry of Energy and
the UK Department of Trade and Industry have jointly sponsored a pilot
plantation in the region to raise the awareness of Jatropha as part of
Thailand's biofuels strategy. D1 Oils Asia Pacific is in advanced negotiations
to plant and manage the pilot project (using D1 Oils' proprietary seeds and
growing medium) and to have full rights to the harvested seeds.

D1 Oils intends that its operations in the Asia Pacific region will be executed
on a similar basis to its activities in other territories. Accordingly, D1 Oils
is in the course of pursuing a number of commercial and industrial opportunities
and is currently in discussions with several large corporate entities with the
intention of securing appropriate joint venture partners.

Europe

D1 20 refinery update

On 8 April 2005, the Company announced the successful completion of a rigorous
24 hour per day, 7 day, continuous production trial of the latest specification
of the D1 20 refinery. During this trial, the refinery produced biodiesel
meeting EN 14214 standard which was subsequently sold, on commercial terms, to
Graystone Automotive Limited, a UK transportation and logistics company. The
trial was witnessed and independently audited by Mott MacDonald, a global power
engineering consultancy. The trial was conducted using rape seed oil and the
Company stated that crude Jatropha oil would be processed by the D1 20 refinery
as soon as sufficient quantity of raw feedstock was available and pre-processing
units designed to process a wider range of both food and non-food grade
vegetable oils, currently under construction, were completed. This was initially
anticipated to be during the second half of 2005.

Since the date of this announcement, the Company has completed fabrication of
the pre-processing units which are now subject to testing and commissioning.
These units will be deployed in combination with the D1 20 refinery, allowing
for a wider variety of type and quality of oil to be processed. The Company has
also bought out the existing D1 20 refinery asset finance lease from Grovefield
Finance Limited (in respect of the UK-based D1 20 refinery). It is intended that
crude Jatropha oil will be processed once sufficient volumes of raw feedstock
are available from the Group's supply contracts. D1 (UK) Limited has scheduled a
further 24 hour per day, 7 day, continuous production trial of the D1 20 and its
pre-processing units, using crude Jatropha oil, for the second half of 2005.

Refining strategy

In the Admission Document, the Group originally identified a refinery capacity
requiring 3 D1 20 refineries. On the basis of the expanded 2006 cumulative
planting target of approximately 267,000 hectares, the Directors anticipate that
there will be a requirement for larger scale refineries. Accordingly, the
Directors are currently evaluating a number of options with a view to securing
larger scale refining capacity, including the following:

   • building larger scale refineries using the D1 20 technology;
   • designing and commissioning new, bespoke, larger scale refineries, which
     may utilise existing, 'off-the-shelf' refining technology;
   • entering into joint venture arrangements with third parties for refining
     capacity; and
   • selling surplus crude Jatropha oil to third party refinery operations.

The Company is currently in negotiations with a third party which has excess
biodiesel refining capacity, with a view to it processing crude oil on the
Group's behalf. The Directors believe that, if negotiations are successfully
concluded, this arrangement will assist to complement the Group's capacity and
help to create shorter term revenues from the second half of 2005.

Middle East

On 16 February 2005, D1 Oils announced that it was developing a renewable
biodiesel business in the Kingdom of Saudi Arabia ('KSA') in partnership with
Jazeera For Modern Technology ('JMT'). A newly created 50/50 joint venture, D1
Oils Arabia, will manage the plantation of Jatropha trees to provide feedstock
to produce renewable biodiesel from former desert land. Initially, 5,000
hectares of land, to be owned by the joint venture, will be provided by JMT. JMT
will also provide D1 Oils Arabia with access to an additional 100,000 hectares
on successful completion of the initial project. The commissioning of the first
D1 20 refinery in the KSA will take place when there are sufficient quantities
of feedstock available to be processed.

Research and development

The Group continues to be committed to achieving quality control and security of
supply throughout its supply chain and has made progress in this regard,
securing large scale volumes of planting seeds, developing customized growing
media for Jatropha and researching the possibility of producing higher oil
yielding Jatropha seeds.

D1 Oils Trading has substantially expanded the research facility carrying out
the Group's ongoing seed testing research and development programme in order to
provide D1 Oils with a secure and quality supply of seeds for the cultivation of
Jatropha. The Group's Indian based product development centre, the PDC, has
collected over 100 different genotypes of Jatropha and is currently cultivating
and testing these specimens for quality and adaptability to different growing
regions globally. D1 Oils Trading has also entered into a separate research and
development agreement with a third party who will help to support the research
at the PDC in the production of custom-designed, region and site-specific
Jatropha seedlings which enhance germination, survival and yield
characteristics.

On 12 August 2004, D1 Oils Trading entered into an agreement with an Indian
research facility for the supply of 50 tonnes of planting seeds (which have been
delivered and paid for) and for the incremental supply of 25,000 seedlings
developed from a tissue culture process (at a cost of 18 Indian Rupees per
seedling). D1 Oils Trading has now cancelled the tissue culture element of this
contract, at no cost to the Group, and has placed secure orders for a total of 9
million tissue cultured seedlings with an existing laboratory specialising in
quality micro-propagation (at a price of 3.6 Indian Rupees per seedling). These
contracts are being supplied 'motherstock' material by the PDC in order to
ensure suitable quality control and Group management. These orders will be
financed and used by the D1 Oils Arabia joint venture, further details of which
are set out below in the section headed 'Middle East'.

Current developments

Since the date of the Admission Document, the Company has continued to execute
its business strategy in the Group's existing territories, while pursuing a
number of additional opportunities, in new and existing territories, to purchase
vegetable oil and enter into joint ventures or strategic alliances to develop
additional biodiesel and related businesses. The Directors are of the view that,
at this stage in the Company's development, and in order to quickly seize upon
available, already identified expansion opportunities, additional equity funding
is required. This, taken in tandem with the leveraged finance made available by,
or in the course of being negotiated with, a variety of third party financial
institutions and strategic joint venture parties will allow the Group to
maintain its current growth.

It is possible that, where negotiations are ongoing, agreement may not be
concluded in the short term or, indeed, at all, and Shareholders should be aware
that there can be no guarantee that the Company will be able to enter into
contractually binding arrangements in the foreseeable future. The principal
terms on which the material opportunities are being negotiated or have been
concluded are summarised below.

   • China

     On 19 November 2004 the Company announced that it had entered into a heads 
     of terms with the Sichuan Yangtze River Technology Company Limited, Chengdu
     ('Sichuan') to form a new joint venture operation, D1 Oils China.

     D1 Oils Trading today announces that it has entered into a conditional 50 
     year joint venture agreement to develop a Jatropha biodiesel refining and 
     feedstock supply business for the Chinese market. The first stage in this 
     venture is for D1 Oils China to assess and audit the volume and quality of 
     existing Jatropha growing in the region. Following this investigation, D1 
     Oils China will identify the extent of the first area required to be 
     planted in order to reach its stated 500,000 tonnes target from the region 
     as soon as practical. Lance Browne, a member of D1 Oils' Consultancy Panel 
     has been assisting the Company in conducting these negotiations. This joint 
     venture includes the following elements:

     • initial equity contribution of 49 million RMB (approximately £3.1
       million) by Sichuan and 51  million RMB (approximately £3.22 million) by 
       D1 Oils, in order to capitalise the joint venture and provide sufficient
       initial working capital facilities, with an equity participation split of 
       49 per cent. and 51 per cent. respectively;
     • Sichuan to procure the assignation of a minimum of 150,000 hectares and
       up to 2 million hectares of suitable land for the cultivation of 
       Jatropha;
     • D1 Oils Trading to provide technical personnel, training for agronomy
       and refinery activities; and
     • D1 Oils Trading to supply certain agronomy technology, input supplies
       and management services.

D1 Oils China will evaluate the appropriate refinery strategy to match its
expected feedstock production.

   • India

     The Company is currently involved in advanced negotiations with a third 
     party with a view to developing a joint venture, on an exclusive basis, 
     within the North East of India for the purposes of developing a biodiesel 
     business. Although the details of the arrangement are still the subject of 
     negotiation and have yet to be finally agreed, the Directors intend that, 
     if negotiations are concluded, the joint venture arrangement will include 
     substantially all of the following elements:

     • equity contribution by each of D1 Oils Trading and the third party, in
       order to capitalise on the joint venture, with a view to agreeing a split 
       of equity participation whereby D1 Oils Trading retains the majority 
       share;
     • the assignation, by the third party, to the joint venture of sufficient
       land to commence at least a 10,000 hectare project and an option to 
       acquire or lease additional land of up to approximately 1  million 
       hectares;
     • a royalty secured by D1 Oils Trading, payable by the joint venture,
       based on a percentage of the sales value of the biodiesel produced;
     • at least one D1 20 refinery to be purchased by the joint venture;
     • the supply of certain agronomy technology, input supplies and management
       services by D1 Oils Trading;
     • a long term guarantee to purchase the resulting biodiesel produced to be
       provided by the third party; and
     • non-recourse banking facilities, on economic terms, to be provided by
       the third party in order to purchase capital equipment, input supplies 
       and project financing for the joint venture.

The Directors believe that D1 Oils is currently considered to be a leading
promoter of biodiesel by the Indian Government and, taken together with its
existing D1 Mohan joint venture, it is a leading biodiesel company in India. D1
Oils has recently been granted an export licence by the Indian Government in
respect of Jatropha seeds. D1 Oils has also approached The National Oilseeds and
Vegetable Oils Board, a Ministry of Agriculture Department, seeking its
recognition and accreditation of the PDC as an official Indian Research and
Development Centre.

The Company also announces today that it has reached agreement with a third
party crude Jatropha oil producer with a view to entering into arrangements to
supply D1 Oils Trading with crude Jatropha oil, at commercial rates, with an
option to export the oil. It is anticipated that the supply of up to 60,000
tonnes per annum of crude Jatropha oil will commence during the course of 2007
(for a period of a minimum of 10 years).

   • Middle East

     D1 Oils Trading today announces that it has entered in to a strategic 
     alliance agreement with Abdullatef Al-Rajhi International Group ('AAIG') 
     for the design, development and implementation of waste water management 
     facilities and infrastructure for the reclamation of up to 300,000 hectares 
     of land suitable for producing energy crops in the KSA.

     Pursuant to the strategic alliance, AAIG will be responsible for the 
     following elements:

     • paying all costs or provide the necessary financing to implement the
       plantation element of the proposed project, including leasing up to 
       300,000 hectares of land suitable for the commercial production of 
       Jatropha crops for a minimum lease period of 20 years. Leasing fees will 
       be compensated  for under a revenue sharing arrangement as mutually 
       agreed upon by both parties; and
     • all KSA permits, certificates and local and federal government
       authorisations related to the project.

D1 Oils Trading will be responsible for supplying, on commercial terms, the
following elements:

     • access to tissue cultured Jatropha seedlings, suitable for the
       cultivation of up to 300,000 hectares of land, and agri-extension kits,
       including growing media, bio-fertilisers, nursery supplies, planting 
       tools and planting instructions required to cultivate Jatropha; and
     • technical personnel, training in agronomy and refinery techniques,
       certain agronomy technology, input supplies and management services, 
       product specifications, to produce organic fertiliser domestically from 
       Jatropha oil seedcake, and design specifications for the construction and 
       design of regional composting units.

It is intended that the strategic alliance will be operated by D1 Oils Arabia
which will purchase one D1 20 refinery and corresponding pre-processing units,
located at a site to be designated by AAIG.

   • Africa

     As previously mentioned above in the section headed 'Africa', the Company 
     has reviewed its commercial activities in Burkina Faso and intends that a 
     new joint venture operation, D1 Oils Burkina Faso, be set up between D1 
     Oils Trading and Biodiesel Corporation. The Directors intend that, if 
     negotiations are concluded, the agreement will include substantially the 
     following elements:

     • Biodiesel Corporation will transfer to the joint venture, its rights to
       the pilot plantation land of 10,000 hectares and the corresponding option 
       to contract approximately an additional 990,000 hectares of land;
     • D1 Oils Burkina Faso will contract to purchase D1 Oils' branded seeds,
       seedlings and growing media at commercial rates and to purchase a minimum 
       of two D1 20 refineries at market rates;
     • Biodiesel Corporation will provide farm management services and sell the
       harvested seeds back to the joint venture at US$50 per tonne; and
     • D1 Oils Burkina Faso will be responsible for producing crude Jatropha
       oil and converting that oil into biodiesel which it intends to sell into 
       the local market (planting is currently scheduled to commence during the 
       third quarter of 2005).

Following the completion of an initial environmental assessment, the North West
Province Government of South Africa is in the process of establishing eight 100
hectare pilot plantations. Although there is no contractual commitment, the
Group is in discussions with the Government with a view to entering into an
arrangement for the purchase of harvested seeds.

Current trading, prospects and use of proceeds

The audited results for the period ended 31 December 2004 were announced earlier
today. Since the financial year end, the Group's business has continued to trade
in line with the Directors' expectations, and its expansion opportunities have
been increased by securing approximately £25 million of third party financing
for the Group's global operations. D1 Oils Trading (or certain of its joint
venture companies) is in negotiations to secure further equity investment or
financing arrangements with banks and commercial partners.

As at 31 March 2005, the Group's net cash balance was approximately £4.2
million. The Group's operational expenditure to date is in line with the
expectations outlined in the Admission Document, despite the acceleration of key
components of the business plan as outlined above.

The Directors believe that there are a number of positive variations from their
originally anticipated use of proceeds received at the time of the Company's
admission to AIM (as stated in the Admission Document) which can be broadly
summarised as follows:

   • the previous planting target of 37,000 hectares has been increased to
     267,000 hectares. In the Admission Document, the Directors anticipated that
     planting costs would be in the region of approximately £0.9 million,
     although the spend to date is actually approximately £0.4 million,
     principally on the advance purchase of seeds, pre-payments for seedlings 
     and land preparation costs;
   • the continuing development of the D1 20 refinery and, in particular, the
     research, design and fabrication of the pre-processing units has resulted 
     in an additional spend of approximately £0.7 million, compared to the 
     Board's previous estimate of approximately £200,000;
   • the Group spent approximately £0.9 million buying out the existing D1 20
     refinery asset finance lease from Grovefield Finance Limited (in respect of
     the UK-based D1 20 refinery);
   • the terms of the acquisition of the intellectual property and know-how
     in the D1 20 refinery technology from Mr Steve Davis were renegotiated. Mr
     Davis waived his right to the previously agreed £0.9 million payment in 
     lieu of the immediate sale of his and his family's entire holding of 
     1,385,000 Ordinary Shares to the trustee of the D1 Oils Employee Share 
     Trust for a total consideration of £3,462,500. The consideration for this 
     Ordinary Share purchase was loaned to the trustee direct by D1 Oils. 
     Further details of this arrangement are set out below in the section 
     headed 'D1 Oils Employee Share Trust'; and
   • the build out programme of the 3 D1 20 refineries planned for early 2005
     has been delayed, resulting in a net, short term saving of £0.5 million.

The Placing will raise approximately £25.8 million (before expenses). The
Placing will expand the Company's capital base, support the implementation of
the Company's strategy and, the Directors believe, enable the Group to
capitalise on the expansion and research and development opportunities in new
and existing territories. More specifically, your Directors intend that the net
proceeds of approximately £24.3 million raised by the Placing.

   • approximately £6  million in respect of equity investment and providing
     sufficient working capital for D1 Oils China in order to establish
     operations in this key market;
   • approximately £5  million in respect of equity investment and providing
     sufficient working capital for the proposed joint venture in North East
     India and for expanding the working capital base for D1 Mohan to fund the
     accelerated roll-out of its planting operations;
   • approximately £6 million building out the refinery strategy on a
     regional basis, the current expected roll-out programme (including up to 9
     new D1 20 refineries), further research and development and the proposed
     investment in larger scale refinery technology; and
   • approximately £7.3 million accelerating the implementation of additional
     global opportunities and corresponding operations and general working
     capital purposes.


Details of the Placing

The Placing is expected to raise approximately £24.3 million (net of expenses).
Pursuant to the Placing, 9,732,617 New Ordinary Shares are being placed firm
with certain institutional and other investors at a price of 265p per Ordinary
Share.

D1 Oils Employee Share Trust

The Directors believe that the success of the Group will depend to a high degree
on the future performance of the management team and recognise the importance of
ensuring that all employees are well motivated and identify closely with the
success of the Group. The Company has formed the D1 Oils Employee Share Trust, a
newly established employee share trust founded for the benefit of such of the
employees and former employees of D1 Oils and its subsidiaries and their
spouses, widows and widowers, children and step-children (under the age of 18)
and in such manner as the trustees may determine (from time to time). The
trustees are wholly independent of the Directors.

On 8 February 2005, D1 Oils announced that it intended to contest vigorously a
claim which had been lodged with the High Court for approximately £725,000 in
respect of a dispute over payment for services and intellectual property rights
with Mr Steve Davis and his wholly-owned company SIF. In the Admission Document,
D1 Oils provided for the payment of the disputed amount to be made using part of
the original placing proceeds. However, subsequently, on 6 April 2005, D1 Oils
announced that it had settled, at no additional cost to the Company, a claim
against it of approximately £1 million in respect of this dispute. Under the
terms of the settlement Mr Davis agreed to sell his and his family's entire
holding in D1 Oils of 1,385,000 Ordinary Shares to the trustees of the D1 Oils
Employee Share Trust for £2.50 per Ordinary Share, a significant discount to the
mid-market closing price of £3.70 on 31 March 2005, the last dealing day before
the settlement price was agreed. The £3,462,500 consideration for the purchase
of these Ordinary Shares was loaned to the trustees direct by D1 Oils.

EXPECTED TIMETABLE
                                                                          2005
Dealings expected to commence in the New Ordinary Shares  8.00 a.m. on 14 June
CREST Member accounts expected to be credited with New Ordinary        14 June
Shares
Share certificates for New Ordinary Shares expected to be              14 June
despatched on or after


Definitions
The following definitions apply throughout this document, unless otherwise
stated or the context requires otherwise:

'Act'               the Companies Act 1985 (as amended)

'Admission'         admission of the New Ordinary Shares to trading on AIM and
                    such admission becoming effective as provided in Rule 6 of
                    Part 1 of the AIM Rules

'Admission          the Company's AIM admission document dated 21 October 2004
Document'

'AIM'               AIM, a market operated by the London Stock Exchange

'AIM Rules'         the rules of the London Stock Exchange governing admission
                    to and the operation of AIM

'Articles'          the articles of association of the Company

'Bell Lawrie'       a division of Brewin Dolphin Securities, the Company's
                    Nominated Adviser and Broker

'Biodiesel          Biodiesel Corporation B.F Limited, a company registered and
Corporation'        incorporated in Burkina Faso, whose registered offices are
                    located at Ouagadougou, Burkina Faso

'Board' or          the board of directors of the Company
'Directors'

'Brewin Dolphin     Brewin Dolphin Securities Limited, which is authorised and
Securities'         regulated by the Financial Services Authority

'Business Day'      any day (excluding Saturdays and Sundays) on which banks are
                    open in London for general non-automated banking business

'Certified' or 'in  an Ordinary Share which is not in uncertificated form
certified form'

'CJPA'              Coimbature Jatropha Producers Association, formerly known as
                    Aavin Dairies and/or The Coimbature District Co-operative
                    Milk Producer's Union Limited

'Company' or 'D1    D1 Oils plc, a public limited company incorporated and
Oils'               registered in England and Wales with registered number
                    5212852

'CREST'             the computerised settlement system to facilitate the holding
                    of and the transfer of title of shares in uncertificated
                    form, operated by CRESTCo Limited

'CREST Member'      a person who has been admitted by CRESTCo Limited as a
                    System Member (as defined in the CREST Regulations)

'CREST              a person who is, in relation to CREST, a System-Participant
Participant'        (as defined in the CREST Regulations)

'CREST Participant  the identification code or membership number used in CREST
Code'               to identify a particular CREST Member or other CREST
                    Participant

'CREST              The Uncertificated Securities Regulations 2001 (SI 2001 No.
Regulations'        3755) as amended

'D1 Mohan'          D1 Mohan Bio Oils Limited, a company incorporated and
                    registered in India, under registered number
                    U74999TN2005PLC055668

'D1 Oils Africa'    D1 Oils Africa (Pty) Limited, a company incorporated and
                    registered in the Republic of South Africa under registered
                    number 2002/009707/07

'D1 Oils Arabia'    D1 Oils Arabia, a company in the process of being
                    incorporated and registered in Saudi Arabia

'D1 Oils Asia       D1 Oils Asia Pacific, Inc., a company incorporated and
Pacific'            registered in The Republic of The Philippines under
                    registered number CS200406183

'D1 Oils Burkina    D1 Oils Burkina Faso Limited, a company in the process of
Faso'               being incorporated and registered in Burkina Faso

'D1 Oils China'     D1 Oils China Limited, a company in the process of being
                    incorporated and registered in China

'D1 Oils Ghana'     D1 Oils Ghana Limited, a company in the process of being
                    incorporated and registered in Ghana

'D1 Oils India'     D1 Oils India (Private) Limited, a company incorporated and
                    registered in India under registered number
                    U74999DL2005PTC135699

'D1 Oils South      D1 Oils South Africa (Pty) Limited, a company incorporated
Africa'             and registered in The Republic of South Africa under
                    registered number 2002/017705/07

'D1 Oils Trading'   D1 Oils Trading Limited, a company incorporated and
                    registered in England and Wales with registered number
                    4645184

'D1 (UK) Limited'   D1 (UK) Limited, a company incorporated and registered in
                    England and Wales with registered number 4468088

'EU'                the European Union

'€' or 'Euro'       the Euro, currency of the EU

'FSMA'              the Financial Services and Markets Act 2000

'Group'             the Company and its subsidiary undertakings

'London Stock       London Stock Exchange plc
Exchange'

'New Ordinary       the 9,732,617 New Ordinary Shares to be issued in connection
Shares'             with the Placing at the Placing Price

'NGO'               non-governmental organisation

'Official List'     the Official List of the United Kingdom Listing Authority

'Ordinary Shares'   ordinary shares of 1p each in the capital of the Company

'Overseas           Shareholders who have a registered address outside the UK
Shareholders'

'PDC'               the Global Product Development Centre, the Group's research
                    facility located at Coimbature, India

'Placees'           subscribers for the Placing Shares procured by Bell Lawrie
                    (as agent for the Company) pursuant to and on the terms of
                    the Placing Agreement

'Placing'           the arrangements for the procurement of subscribers for the
                    Placing Shares by Bell Lawrie pursuant to the Placing
                    Agreement

'Placing            the conditional agreement dated 31 May 2005 between (1) Bell
Agreement'          Lawrie and (2) the Company relating to the Placing

'Placing            the document published on 31 May 2005
Memorandum'

'Placing Price'     265p per New Ordinary Share

'Placing Shares'    the 9,732,617 New Ordinary Shares to be placed in connection
                    with the Placing at the Placing Price

'POS Regulations'   The Public Offers of Securities Regulations 1995, as
                    amended

'RMB'               China Yuan Renminbi

'Shareholder(s)'    the person(s) who are registered as holder(s) of Ordinary
                    Shares from time to time

'UK'                United Kingdom of Great Britain and Northern Ireland

'UK Listing         the Financial Services Authority acting in its capacity as
Authority'          the competent authority for the purposes of Part VI of the
                    Financial Services and Markets Act 2000

'uncertificated' or recorded on the register of Ordinary Shares as being held in
'in uncertificated  uncertificated form in CREST, entitlement to which by virtue
form'               of the CREST Regulations, may be transferred by means of
                    CREST

'US' or 'United     United States of America, each state thereof, its
States'             territories and possessions and the District of Columbia

'US$' or 'dollar'   United States dollar

'£'                 United Kingdom pounds sterling







The following financial information has been derived from the Annual Report and
Financial Statements for the year ending 31 December 2004 but does not
constitute statutory accounts for the periods ending 31 December 2004 or 2003.

The statutory accounts for the year ended 31 December 2004 will be delivered to
the Registrar of Companies following the company's annual general meeting. The
auditors have reported on those accounts; their reports were unqualified and did
not contain statements under s237(2) or (3) Companies Act 1985

Chairman's Statement

Review of the reporting period

I am pleased to announce our results for the year ended 31 December 2004, our
first results, since the Company's Ordinary Shares were admitted to AIM in
October last year. I can report that the Group is making good progress as it
seeks to establish itself as a leading sustainable global low cost producer of
biodiesel. Since its admission to AIM last year, the Group has continued to
implement its strategy. Certain key business goals have been accelerated,
including the extension of our planned planting programme and expansion of our
operations in existing and new territories.

Financial results

In the year ended 31 December 2004, the Group's loss on ordinary activities
before taxation was £3,064,277, which is a loss per share of 47.53p. The cash
balance at the end of this period was £9,562,364 after financing receipts of
£12,702,085 in the year. The working capital spend to date is in line with the
expectations outlined in the Admission Document, despite the acceleration of
certain key components of the business plan.

D1 Oils brand

D1 Oils is building a global brand. We are working closely with government and
industry stakeholders in territories, including India and Thailand, and continue
to expand the Group's presence and brand globally.

Employees, joint venture partners and Consultancy Panel

Much hard work and dedication has been applied throughout the Group to implement
our strategy and build our business. Our joint venture partners have assisted us
in creating our presence in our operational regions, while our Consultancy Panel
has also contributed to accessing new prospects, including opportunities in
China. I would like to thank all of our staff, joint venture partners and our
Consultancy Panel for their contribution throughout 2004 and into 2005.

Current trading and prospects

Since the financial year end, the Group's business has continued to trade in
line with the Directors' expectations. The Group has further increased its
expansion opportunities and has secured approximately £25 million of third party
financing for the Group's global operations and the Board remains confident
about the prospects of the Group during 2005.

Karl Watkin MBE
Chairman


Chief Executive's Report

Market drivers

The emerging global biodiesel market has been reinforced recently by the signing
of the Kyoto Protocol and the continuing implementation by EU member states of
the Biofuels Directive which has set indicative targets for a minimum level of
biofuels of 5.75 per cent. by 2010. We are also seeing other markets accept
biodiesel as a sustainable, renewable fuel resource and have identified China as
a new territory in which to pursue additional opportunities. We are also
continuing to seek expansion opportunities in India and elsewhere.

Strategy and overview of operations

We aim to take advantage of the increasing global acceptance of biodiesel as a
sustainable renewable fuel resource in pursuit of our strategy to become a
leading sustainable global low cost producer of biodiesel. This has meant that
since admission of the Company's ordinary shares to trading on AIM in October
last year we have been able to expand our planting targets and pursue new
opportunities which have been made available to us, including securing third
party financing.

On 14 April 2005 we announced that our Indian joint venture company, D1 Mohan
Bio Oils Limited, had expanded its initial Plantation planting target of 5,000
hectares to 100,000 hectares by the end of 2005. D1 Mohan has also secured £15
million of third party funding for farmers to take up the planting and
cultivation of Jatropha which will fund the planting of up to 40,000 hectares of
Jatropha.

On 16 February 2005 we announced that a new joint venture with Jazeera Modern
Technology of Saudi Arabia will soon oversee the planting of 5,000 hectares of
Jatropha in the desert outside Riyadh. The joint venture company has an option
to expand the territory available for planting to 100,000 hectares. We believe
this is an example of our ability to customise our business in individual
operational regions.

Refining capacity

The current specification of the D1 20 refinery has completed its 24/7 test and
we have completed the fabrication of additional pre-processing units (which are
subject to commissioning and testing) and which will allow us to process a wider
variety of type and quality of oils. We are pursuing options to achieve
additional refining capacity to meet the anticipated increased refining demand
resulting from crude Jatropha oil to be produced pursuant to the increased
planting targets.

Outlook

We believe that the Group is well placed to benefit from the many opportunities
that are expected to arise. The Group will continue to implement and execute its
business plan and will continue to strengthen the security of its supplies by
expanding its portfolio of sources of oil.

Philip Wood
Chief Executive


CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the year ended 31 December 2004

                                          Note      Year ended         49 week
                                                   31 December    period ended
                                                          2004     31 December
                                                          Note            2003
                                                             £               £
                                                                             
Administrative expenses                             (3,024,838)       (704,478)
                                                 --------------- ---------------
                                                             
OPERATING LOSS                               4      (3,024,838)       (704,478)
Interest receivable and similar income                  77,155               -
Interest payable and similar charges                  (116,594)              -
                                                 --------------- ---------------
                                                             
LOSS ON ORDINARY ACTIVITIES
BEFORE TAXATION                                     (3,064,277)       (704,478)
Tax on loss on ordinary activities           7               -               -
                                                 --------------- ---------------
                                                             
RETAINED LOSS FOR THE FINANCIAL           
YEAR WITHDRAWN FROM RESERVES              8,17      (3,064,277)       (704,478)
                                                 =============== ===============
LOSS PER ORDINARY SHARE                      
Basic and diluted loss per ordinary share    9           47.53p      £7,044.78
                                                 =============== ===============

All activities derive from continuing operations.

The Group has no recognised gains and losses other than the loss for the current
financial year and preceding financial period and therefore no separate
Statement of Total Recognised Gains and Losses has been presented.

During the period the holding company, D1 Oils plc, acquired a new subsidiary D1
Oils Trading Limited. The profit and loss account has been prepared using merger
accounting and is presented on a pro forma basis as if the Group had been in
existence throughout both the current and prior periods. Further information is
given in note 1.

A consolidated profit and loss account from the date of incorporation of the
holding company is given in note 26.











CONSOLIDATED BALANCE SHEET
As at 31 December 2004
                                                                     Pro forma
                                      Note     31 December         31 December  
                                                      2004                2003
                                                         £                   £
                                                                             
FIXED ASSETS            
Intangible assets                       10          67,580                   -
Tangible assets                         11         831,120               1,410
                                             ---------------     ---------------
                                                   898,700               1,410
                                             ---------------     ---------------

CURRENT ASSETS                          
Debtors                                 13          79,350                   -        
Cash at bank and in hand                         9,562,364               2,908
                                             ---------------     ---------------
                                                 9,641,714               2,908
CREDITORS: amounts falling due within
one year                                14        (816,283)           (708,795)
                                             ---------------     ---------------
NET CURRENT ASSETS/(LIABILITIES)                 8,825,431            (705,887)
                                             ---------------     ---------------

TOTAL ASSETS LESS CURRENT LIABILITIES            9,724,131            (704,477)
CREDITORS: amounts falling due after
more than one year                      15         (31,845)                  -
                                             ---------------     ---------------
NET ASSETS/(LIABILITIES)                         9,692,286            (704,477)
                                             ===============     ===============
CAPITAL AND RESERVES                    
Called up share capital                 16         214,929                   1
Share premium                           17      12,808,410                   - 
Merger reserve                          17         437,702                   -
Profit and loss account                 17      (3,768,755)           (704,478)
                                             ---------------     ---------------
TOTAL EQUITY SHAREHOLDERS'
FUNDS/(DEFICIT)                         18       9,692,286            (704,477)
                                             ===============     ===============





COMPANY BALANCE SHEET
As at 31 December 2004

                                                      Note         31 December
                                                                          2004
                                                                             £
FIXED ASSETS
Investments                                             12             125,000
                                                                 ---------------

CURRENT ASSETS                                         
Debtors                                                 13           3,421,554              
Cash at bank and in hand                                             9,381,606
                                                                 ---------------

                                                                    12,803,160
CREDITORS: amounts falling due within one year          14            (360,695)
                                                                 ---------------

NET CURRENT ASSETS                                                  12,442,465
                                                                 ---------------

TOTAL ASSETS LESS CURRENT LIABILITIES                               12,567,465
                                                                 ---------------

NET ASSETS                                                          12,567,465
                                                                 ===============
CAPITAL AND RESERVES                                    
Called up share capital                                 16             214,929
Share premium                                                       12,808,410            
Profit and loss account                                 17            (455,874)
                                                                 ---------------

TOTAL EQUITY SHAREHOLDERS' FUNDS                        18          12,567,465
                                                                 ===============

CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 December 2004

                                                                       49 week 
                      Note                Year ended           period ended 31 
                                         31 December                  December        
                                                2004                      2003
                                                   £                         £
Net cash
(outflow)/inflow
from operating
activities              19                (3,064,960)                    4,317
Return on
investment and
servicing of
finance                 20                   (39,439)                        -
Capital
expenditure &
financial
investment              20                   (38,230)                   (1,410)
                                       ---------------           ---------------

Cash outflow
before financing                          (3,142,629)                    2,907
Financing               20                12,702,085                         1
                                       ---------------           ---------------

Increase in cash
in the period                              9,559,456                     2,908
                                       ===============           ===============

(A)Reconciliation of Net Cash Flow to Movement in Net Funds
                                                                      49 week
                                    Year ended 31             period ended 31
                                    December 2004               December 2003       
                                                £                           £
Increase in
cash in the
period                                  9,559,456                       2,908
Repayment of
principal
under finance
leases                                    758,955                           -
                                    --------------              --------------
Change in net
funds
resulting from
cash flows                             10,318,411                       2,908
New finance
leases                                   (750,000)                          -
New finance
leases
obtained on
acquisition of
subsidiary                                (52,742)                          -
Net funds at 1
January                                     2,908                           -
                                    --------------              --------------
Net funds at
31 December                             9,518,577                       2,908
                                    ==============              ==============

(B)Analysis of Changes in Net Funds

                  At 1 January    Cash flows      Other non-  At 31 December
                        2004                    cash changes            2004                        
                           £               £               £               £
                                                           
Cash at bank
and in hand            2,908       9,559,456               -       9,562,364
               --------------  --------------  --------------  --------------
                       2,908       9,559,456               -       9,562,364

Finance leases             -         758,955        (802,742)        (43,787)
               --------------  --------------  --------------  --------------
                       2,908      10,318,411        (802,742)      9,518,577
               ==============  ==============  ==============  ==============


NOTES TO THE FINANCIAL INFORMATION

1. ACCOUNTING POLICIES

The financial information is prepared in accordance with United Kingdom
applicable accounting standards. The particular accounting policies adopted are
described below.

Basis of preparation

(i) Acquisition

D1 Oils plc was incorporated on 24 August 2004 and, on 14 September 2004, the
company acquired the entire share capital of D1 Oils Trading Limited in
consideration for the D1 Oils Trading Limited shareholders receiving ordinary
shares in D1 Oils plc. In accordance with the principles set out in Financial
Reporting Standard ('FRS') 6 'Acquisitions and Mergers', 100% of the shares
acquired have been accounted for under merger accounting. All other acquisitions
are accounted for under the acquisition method. Consequently, although D1 Oils
plc was not incorporated until 24 August 2004 and the combination did not take
place until 14 September 2004, the financial information is presented as though
the merged business had always been a single group.

(ii) Basis of pro forma information

The pro forma consolidated profit and loss accounts have been presented as if
the merger took place on the first day of each financial period presented and as
though the Group, as presently constituted, had been in existence throughout
those periods. The figures for the year to 31 December 2003 have been extracted
from the audited D1 Oils Trading Limited accounts adjusted for the notional 1
share issued in exchange for 100% of the share capital of D1 Oils Trading
Limited. The pro forma cash flow and comparative balance sheet have been
prepared on the same basis. All other acquisitions are accounted for under the
acquisition method.

Accounting convention

The financial information is prepared under the historical cost convention.

Investments

Investments held as fixed assets are stated at cost less provision for any
impairment.

Intangible assets - goodwill

Goodwill arising on the acquisition of subsidiary undertakings and businesses,
representing any excess of the fair value of the consideration given over the
fair value of the identifiable assets and liabilities acquired, is capitalised
and written off on a straight line basis over its useful economic life which is
20 years. Provision is made for any impairment.

Tangible fixed assets and depreciation

Depreciation on fixed assets is calculated to write off their cost, less
estimated residual value, over their expected useful lives at the following
annual rates using the straight line method.

Plant and machinery              3 - 10 years
Fixtures, fittings and equipment 3 - 5  years



Foreign currencies

Monetary assets and liabilities denominated in overseas currencies are
translated into sterling at the rate of exchange ruling at the balance sheet
date. Individual transactions are translated at the rate of exchange ruling on
the date of transaction. All exchange differences are included in the profit and
loss account.

Deferred taxation

Deferred taxation is provided in full on timing differences that result in an
obligation at the balance sheet date to pay more tax, or a right to pay less
tax, at rates expected to apply when they crystallise based on current tax rates
and law. Timing differences arise from the inclusion of items of income and
expenditure in taxation computations in periods different from those in which
they are included in financial statements. Deferred tax assets are recognised to
the extent that it is regarded as more likely than not that they will be
recovered. Deferred tax assets and liabilities are not discounted.

Finance leases and hire purchase contracts

Assets held under finance leases and hire purchase contracts are capitalised at
their fair value on the inception of the leases and depreciated over the shorter
of the period of the lease and the estimated useful economic lives of the
assets. The finance charges are allocated over the period of the lease in
proportion to the capital amount outstanding and are charged to the profit and
loss account. Operating lease rentals are charged to profit and loss in equal
annual amounts over the lease term.

Research and development

Research and development expenditure is charged to the profit and loss account
as incurred.

Share options

In accordance with the provisions of UITF17, the difference between the exercise
price and nominal value of share options granted is credited to the shares to be
issued reserve. Charges are made to the profit and loss account in the period in
which the options are granted.

2. SEGMENTAL INFORMATION

The geographical split of the business is as follows:

                       United Kingdom  South Africa   Philippines        Group
                                   £              £             £            £

Loss on ordinary
activities - year         
ended
31 December 2004          (2,991,719)      (131,012)      (44,706)  (3,064,277)
                          ==========     ==========    ==========   ==========
Loss on ordinary
activities - 49 week
period                      
ended 31 December
2003                        (683,796)       (20,682)            -     (704,478)
                          ==========     ==========    ==========   ==========
Net Assets /
(liabilities)             
- 2004                     9,498,208       (151,686)      (42,392)   9,692,286
                          ==========     ==========    ==========   ==========
Net Liabilities - 2003      (683,803)       (20,674)            -     (704,477)



3. ACQUISITIONS AND MERGER ACCOUNTING

Merger accounting

On 14 September 2004 the company acquired 100% of the issued share capital of D1
Oils Trading Limited and in consideration the D1 Oils Trading Limited
shareholders received ordinary shares in D1 Oils plc. This acquisition has been
accounted for under the rules of merger accounting as a group reorganisation.

The following table sets out the book value of the identifiable assets and
liabilities at the date of the merger. The Directors consider that no
adjustments to fair value are required.

                                                                 Book value to
                                                                         Group
                                                                             £

Fixed assets
Tangible fixed assets                                                  754,581
                                                                 ---------------
                                                                       554,581
Current assets
Debtors                                                                146,199
Cash                                                                    35,940
                                                                 ---------------
Total assets                                                           936,720
                                                                 ---------------
Creditors
Creditors                                                             (158,816)
Overdraft                                                               (8,387)
Accruals                                                              (879,153)
Other creditors                                                     (1,151,458)
                                                                 ---------------
Total liabilities                                                   (2,197,814)
                                                                 ---------------
Net liabilities                                                     (1,261,094)
                                                                 ===============
Share capital                                                          125,000
Share premium                                                          437,702
Profit and loss account                                             (1,823,786)
                                                                 ---------------
                                                                    (1,261,094)
                                                                 ===============

Under the principles of merger accounting the share premium account has been
adjusted through the merger reserve.

Net cash outflows in respect of the acquisition comprised:

                                                                             £

Cash at bank and in hand acquired                                       35,940
Costs of acquisition                                                         -
Bank overdrafts acquired                                                (8,387)
                                                                 ---------------
                                                                        27,553
                                                                 ===============

D1 Oils Trading Limited incurred a loss after taxation of £1,678,220 for the
year ended 31 December 2004.

                                                                          2004
                                                                             £

Other operating expenses (net)                                      (1,561,682)
                                                                 ---------------
Operating loss                                                      (1,561,682)
Finance charges (net)                                                 (116,538)
                                                                 ---------------
Loss on ordinary activities before taxation                         (1,678,220)
Tax on loss on ordinary activities                                           -
                                                                 ---------------
Loss for the financial period                                       (1,678,220)
                                                                 ===============

Acquisition Accounting

On 25 March 2004, D1 Oils Trading Limited acquired the whole of the share
capital of D1 Oil Subsidiary Limited. The following table sets out the book
values of the identified assets and liabilities acquired. No adjustments were
made for fair value. Separate presentations of the results in the profit and
loss account have not been provided on the grounds of materiality.

                                                                          2004
                                                                             £

Tangible fixed assets                                                   53,443
Debtors                                                                143,892
Creditors                                                             (213,806)
Finance leases                                                         (52,743)
                                                                 ---------------
Net liabilities                                                        (69,214)
                                                                 ---------------
Satisfied by:                                                              
Settlement of borrowings                                                   999
                                                                 ---------------
Goodwill on acquisition                                                 70,213
                                                                 ---------------













4. OPERATING LOSS

                                   Year ended 31                49 week period
                                   December 2004                      ended 31
                                                                 December 2003
                               £               £             £               £

Operating loss is
stated after
charging:

Directors'
remuneration
(see note 6)                             254,833                         5,208
Bad debts (see
note 27)                                 149,770                             -
Depreciation:
- owned assets             1,507                             -
- leased assets           10,456                             -
                     -----------                   -----------
                                          11,963                             -
Amortisation
of goodwill                                2,633                             -
Research and
development                              484,738
Auditors'
remuneration
Audit services                            53,000                         5,000
Non audit services
Taxation
advisory                  76,375                             -
Other advisory
services                 124,088                             -
Charged to
share premium           (200,463)              -             -               -
                     -----------         =======   -----------         =======
5. INFORMATION REGARDING EMPLOYEES

                                                 Year ended 31  49 week period
                                                 December 2004        ended 31
                                                                 December 2003
                                                           No.             No.

Total average number employed by the Group
including executive directors was:

Executive
directors and
administration
staff                                                        7               4
                                                 ==============  ===============
The costs incurred in respect of these employees             £               £
(including directors) were:

Wages and
salaries                                               377,898           5,208
Social
security costs                                          41,476               -
                                                 --------------- ---------------

                                                       419,374           5,208
                                                 ==============  ===============





6. DIRECTORS' REMUNERATION

                             Basic          Fees   Benefits in   Year ended 31
                          salaries                        kind   December 2004 
                                 £             £             £               £

Executive directors

Karl Watkin                 50,000             -             -          50,000
Mark Quinn                  50,000             -         4,000          54,000
Alex Worrall                33,333             -             -          33,333
Philip Wood                 50,000             -             -          50,000
Peter Campbell              40,000             -             -          40,000

Non-executive
directors

Barclay
Forrest                      4,000         5,167             -           9,167
Clive Morton                 4,000         5,167             -           9,167
Peter Davidson               4,000         5,167             -           9,167
                       -----------   -----------   -----------     -----------
                           235,333        15,500         4,000         254,833
                       ===========   ===========   ===========     ===========

Directors' share options:

                         Number of shares
Directors        Granted      Exercised    31 December   Exercise price Date from which    Expiry date
                                                  2004                     exercisable
            ------------   ------------   ------------    ------------   ------------- ---------------
                                                                                                 
Karl              39,062              -         39,062           £1.28    October 2005    October 2014
Watkin
Mark              39,062              -         39,062           £1.28    October 2005    October 2014
Quinn
Alex              39,062              -         39,062           £1.28    October 2005    October 2014
Worrall
Philip           234,374              -        234,374           £1.28    October 2005    October 2014
Wood
Peter             39,062              -         39,062           £1.28    October 2005    October 2014
Campbell
Barclay           78,125              -         78,125           £1.28    October 2005    October 2014
Forrest           
Peter            156,250              -        156,250           £1.28    October 2005    October 2014
Davidson
Clive            156,250              -        156,250           £1.28    October 2005    October 2014
Morton
            ------------   ------------   ------------
                 781,247              -        781,247
            ============   ============   ============




7. TAX ON LOSS ON ORDINARY ACTIVITIES

The tax credit during the year was £nil (49 weeks ended 31 December 2003: £nil).

(i) Factors affecting tax credit for the current year

The tax credit assessed for the year is lower than that resulting from applying
the standard rate of corporation tax in the UK - 30%. The differences are
explained below:

                                             Year ended 31      49 week period
                                             December 2004            ended 31
                                                                 December 2003
                                                         £                   £
Loss on
ordinary
activities
before tax                                      (3,064,277)           (704,478)
                                             ===============     ===============
Tax at 30%
thereon                                           (919,268)           (211,343)
Expenses not
deductible for
tax purposes                                       213,648              80,489
Losses for
which no tax
relief
available                                          653,844             124,650
Losses of
overseas
subsidiaries
for which no
tax relief
available                                           51,776               6,204
                                             ---------------     ---------------
Current tax credit for the period                        -                   -
                                             ===============     ===============
At 31 December 2004 the Group has estimated management expenses of £330,000
(2003:£Nil) to carry forward to set off against future income and gains of the
parent company and has estimated expenditure of £2,264,000 (2003: £415,000)
which will be available to set against future trading profits of UK subsidiary
companies. In addition overseas subsidiary companies have estimated expenditure
of £198,000 (2003: £21,000) to set against future trading profits. A UK deferred
tax asset of £778,000 (2003:£131,000) has not been recognised in respect of the
management expenses and expenditure carried forward as there is insufficient
evidence that the asset will be recovered.

8. LOSS OF PARENT COMPANY

As permitted by Section 230 of the Companies Act, the profit and loss account of
the parent company is not presented as part of these accounts. The parent
company's loss for the 18 week financial period ended 31 December 2004 amounted
to £455,874.

9. LOSS PER ORDINARY SHARE

Loss per share has been calculated using the weighted average number of shares
in issue during the relevant financial periods in accordance with FRS 14 for
merged results. The weighted average number of shares in issue is as detailed
below and the earnings, being loss on ordinary activities after taxation, are
£3,064,277 (49 weeks ended 31 December 2003: £704,478).

No diluted loss per share has been disclosed as the share options are
anti-dilutive.

                                           Year ended 31       49 Week period
                                           December 2004             ended 31
                                                                December 2003
                                                     No.                  No.
Weighted
average number
of shares                                      6,447,640                  100
                                             ===========          ===========
                                                    2004                 2003
                                                   Pence                    £
Loss per
ordinary share - basic and diluted                47.53p            £7,044.78
                                             ===========          ===========

10. INTANGIBLE ASSETS

                                                Goodwill                Total
                                                       £                    £

Cost
Additions during the year                         70,213               70,213

At 31 December 2004                               70,213               70,213
                                             ===========          ===========
Accumulated depreciation
Charge for the year                                2,633                2,633

At 31 December 2004                                2,633                2,633
                                             ===========          ===========
Net book value
At 31 December 2004                               67,580               67,580
                                             ===========          ===========
At 31 December 2003                                    -                    -
                                             ===========          ===========

11. TANGIBLE FIXED ASSETS

               Leased vehicles Motor vehicles        Plant and   Fixtures and        Total
                                                   machinery       fittings
                           £               £               £              £              £
The Group

Cost
At 1 January
2004                       -               -               -          1,410          1,410
Acquisition of
subsidiary
undertaking           53,443               -               -              -         53,443
Additions                  -           3,535         769,876         14,819        788,230
                  ----------   --------------- -------------   ------------   ------------

At 31 December
2004                  53,443           3,535         769,876         16,229        843,083
                  ----------   --------------- -------------   ------------   ------------

Accumulated
depreciation
At 1 January               
2004                       -               -               -              -              -
Charge for the
year                  10,456               -               -          1,507         11,963
                  ----------   --------------- -------------   ------------   ------------

At 31 December
2004                  10,456               -               -          1,507         11,963
                  ----------   --------------- -------------   ------------   ------------

Net book
value
At 31 December
2004                  42,987           3,535         769,876         14,722        831,120
                 ===========  ================ =============   ============   =============
At 31 December
2003                       -               -               -          1,410          1,410
                 ===========  ================ =============   ============   =============





12. INVESTMENTS IN GROUP UNDERTAKINGS

On 14 September 2004, D1 Oils plc acquired the entire issued share capital of D1
Oils Trading Limited in consideration for the D1 Oils Trading shareholders
receiving 12,500,000 ordinary shares of 1p each in aggregate on the basis of one
hundred ordinary shares for every one ordinary share of £1 each in the capital
of D1 Oils Trading Limited.

                                                                          2004
                                                                             £

Shares in subsidiary undertakings:
Nominal value
Additions                                                              125,000
                                                                 ---------------

At 31 December 2004                                                    125,000
                                                                 ===============
Provisions for impairment
Provided in the year                                                         -
                                                                 ---------------

At 31 December 2004                                                          -
                                                                 ===============
Net book value
At 31 December 2004                                                    125,000
                                                                 ===============

The Company owns more than 10% of the share capital of the following subsidiary
companies:

Name            Nature of           Country of     shareholder       Percentage
                Business         Registration           class

D1 Oils         Biodiesel                 UK        Ordinary               100%
Trading Ltd     trading
D1 Oils         Biodiesel                 UK        Ordinary               100%
Subsidiary Ltd  trading
D1 (UK) Ltd     Biodiesel                 UK        Ordinary               100%
                trading
D1 Oils Asia    Biodiesel        Philippines        Ordinary                40%
Pacific Inc     trading
D1 Oils South   Biodiesel       South Africa        Ordinary                75%
Africa (PTY)    trading
Ltd             
D1 Oils Africa  Dormant         South Africa        Ordinary               100%
(PTY) Ltd       
D1 Oils         Dormant             Tanzania        Ordinary                90%
Tanzania Ltd    













13. DEBTORS

                                   Group              Group            Company
                                    2004               2003               2004
                                       £                  £                  £

Other debtors                     78,156                  -             11,718
Amounts owed by subsidiary
undertakings                           -                  -          3,409,836
Prepayments                        1,194                  -                  -
                           --------------     --------------     --------------
                                  79,350                  -          3,421,554
                           ==============     ==============     ==============

14. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

                                  Group              Group            Company
                                   2004               2003               2004
                                      £                  £                  £

Obligations under finance
leases                           11,942                  -                  -
Trade creditors                 555,321              2,618            333,633
Other creditors                  84,095                  -             27,062
Directors loans                  55,204            262,778                  -
Other loans                      65,788             27,824                  -
Amounts owed to related
companies                             -            313,125                  -
Accruals and deferred
income                           43,933            102,450                  -
                          --------------     --------------     --------------
                                816,283            708,795            360,695
                          ==============     ==============     ==============

15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

                                          Group          Group        Company
                                           2004           2003           2004
                                              £              £              £

Obligations under finance leases         31,845              -              -
                                       ========       ========       ========
Obligations under finance leases are secured on the assets to which they relate.
All amounts are due within five years.












16. CALLED UP SHARE CAPITAL

                                                                          2004
                                                                             £

Authorised
52,000,000 ordinary shares of 1p each                                  520,000
                                                                   ===========
Called up, allotted and fully paid
21,492,864 ordinary shares of 1p each                                  214,929
                                                                   ===========
            Acquisition of       Number of   Capitalisation             2004
                       D1   Placing Shares          of Debt              No.
             Oils Trading  
                      Ltd

Number of
ordinary
shares         12,500,000        8,125,000          867,864       21,492,864
            ---------------  ---------------  ---------------  ---------------

D1 Oils plc was incorporated on 24 August 2004 with an authorised share capital
of £50,000 divided into 50,000 ordinary shares of £1 each. Each of the issued
and unissued ordinary shares of £1 was sub-divided into 100 ordinary shares of 1
pence each. The authorised share capital of the company was increased to
£520,000 by the creation of an additional 47,000,000 ordinary shares of 1 pence
each.

On 14 September 2004, the Company acquired the entire issued share capital of D1
Oils Trading Ltd in consideration for the D1 Oils Trading Ltd shareholders
receiving 12,500,000 ordinary shares in aggregate, on the basis of one hundred
ordinary shares for every one ordinary share of £1 each in the capital of D1
Oils Trading Ltd.

On 29 October 2004, the Company placed 8,125,000 shares and was admitted to
trading on AIM. A further 867,864 shares were issued pursuant to the
capitalisation of Directors Loans at the placing price of £1.60.

17. MOVEMENT ON RESERVES

                 Merger reserve  Share premium   Share capital Profit and loss
                                       account                         account
                             £               £               £               £

Group

At 1 January
2004                         -               -               1        (704,478)
Loss for the
year                         -               -               -      (3,064,277)
Merger reserve
adjustment             437,702               -               -               -
Share issue                  -      14,298,655         214,928               -
Issue costs                  -      (1,490,245)              -               -
                 --------------  --------------  --------------  --------------
At 31 December
2004                   437,702      12,808,410         214,929      (3,768,755)
                 ==============  ==============  ==============  ==============
Company

On Incorporation             -               -               -               -
Share issue                  -      14,298,655         214,929               -
Issue costs                  -      (1,490,245)              -        (455,874)
                 --------------  --------------  --------------  --------------
At 31 December
2004                         -      12,808,410         214,929        (455,874)
                 ==============  ==============  ==============  ==============

18. RECONCILIATION OF MOVEMENT IN CONSOLIDATED EQUITY SHAREHOLDERS' FUNDS

                                    Year ended 31     49 Week period ended 31
                                    December 2004               December 2003       
                                                £                           £

Loss for the
year / period                          (3,064,277)                   (704,478)
Shares issued
in the period                          13,023,338                           1
Merger reserve
adjustment                                437,702                           -
                                    ---------------             ---------------
Net addition
to shareholders' funds                 10,396,763                    (704,477)

Opening equity
shareholders'
deficit                                  (704,477)                          -
                                    ---------------             ---------------

Closing equity
shareholders'
funds /
(deficit)                               9,692,286                    (704,477)
                                    ==============              ===============









19. RECONCILIATION OF OPERATING LOSS TO NET CASH (OUTFLOW) / INFLOW FROM
OPERATING ACTIVITIES

                                    Year ended 31     49 Week period ended 31
                                    December 2004               December 2003       
                                                £                           £

Operating loss                         (3,024,838)                   (704,478)
Depreciation
on tangible
fixed assets                               11,963                           -
Amortisation
of goodwill                                 2,633                           -
Decrease in
debtors                                    64,542                           -
(Decrease)/Increase in
creditors                                (119,260)                    708,795
                                    ---------------             ---------------

Net cash
(outflow)/inflow from
operating activities                   (3,064,960)                      4,317
                                   ================             ===============

20. GROSS CASH FLOWS

                                                          Year  49 Week period
                                                      ended 31        ended 31
                                                 December 2004   December 2003
                                                             £               £

Returns on investment and servicing of finance
Interest
received                                                77,155               -
Interest
element of
finance leases                                        (116,594)              -
                                                 --------------- ---------------
                                                       (39,439)              -
                                                 =============== ===============
Capital expenditure
Payments to
acquire
tangible fixed
assets                                                 (38,230)         (1,410)
                                                 =============== ===============
Financing
Issue of
ordinary share
capital                                             14,951,285               1
Costs of
raising
finance                                             (1,490,245)              -
Capital
element of
finance lease                                         (758,955)              -
                                                 --------------- ---------------
                                                    12,702,085               1
                                                 =============== ===============

21. NON CASH TRANSACTIONS

During the period the Group entered into finance lease arrangements in respect
of assets with a total capital value at inception of £750,000 and acquired a
finance lease with a subsidiary acquired with a capital value of £52,742. (49
weeks ended 31 December 2003: £nil).









22. FINANCIAL INSTRUMENTS

The main risks arising from the Group's operations are interest rate risk,
liquidity risk, foreign currency translation risk and certain commodity price
risks. The Group does not trade in financial instruments.

The Group's financial assets comprise only cash which earns interest at a
floating rate based on LIBOR. At 31 December 2004 the average interest earned on
the cash balance was 3.5% (49 weeks ended 31 December 2003 :nil).

Interest Rate Risk

The Group has one finance lease obligation the terms of which include a fixed
interest rate of 8%. The capital outstanding at 31 December 2004 was £43,787
(2003 :£nil)

Liquidity Risk

The Group seeks to manage financial risk, to ensure sufficient liquidity is
available to meet foreseeable needs while investing cash assets safely and
profitably.

Foreign Currency Translation Risk

The main functional currency of the Group is sterling. The Group's currency
exposure is limited to the purchase commitments referred to in note 24 which
represent an approximate exposure of $459 million over 20 years.

No significant currency risks arise through the consolidation of overseas
subsidiaries at 31 December 2004. The directors are actively developing an
appropriate means of mitigating the risk of these entities as they become a more
significant element of the business.

Commodity Price Risks

The Group does not engage in commodity hedging activities at present, though
will review its position in relation to the purchase commitments noted in note
24.

23. FINANCIAL COMMITMENTS

Obligations under finance leases and hire purchase contracts

                                                         Group           Group
                                                          2004            2003
                                                             £               £

The maturity of these amounts is as follows:

Amounts payable:
Within one year                                         11,942               -
Within one and two years                                11,942               -
Within two to five years                                19,903               -
                                                     =========       =========
Due within one year                                     11,942               -
Due after more than one year                            31,845               -
                                                     ---------       ---------
                                                        43,787
                                                     =========       =========
Capital commitments
Expenditure contracted for but not provided in               
these financial statements                                   -               -
                                                     =========       =========
24. FINANCIAL COMMITMENTS

The company has entered into contracts for the purchase of raw materials to
produce biosiesel to the value of £237 million over the next twenty years, of
which £4.9 million is due within one year, £35.7 million is due within two to
five years and £196.3 million is due after five years.

25. POST BALANCE SHEET EVENT

On 15 February 2005 D1 Oils plc acquired 50 per cent. at a cost of $1 million in
a joint venture in Saudi Arabia with Jazeera for Modern Technology. The Company
will be known as D1 Oils Arabia Limited.

On 20 January D1 Oils plc acquired a 50 per cent. share in D1 Mohan Bio Oils
Limited at a commitment of 60 million Indian Rupees, which is a joint venture
with D1 Oils plc and Mohan Breweries & Distilleries Limited in India.

26. STATUTORY CONSOLIDATED PROFIT AND LOSS
                                                                18 week Period
                                                                      ended 31
                                                                 December 2004
                                                                             £

Administrative expenses                                               (987,924)
                                                                 -------------
Operating loss                                                        (987,924)

Other interest receivable and similar income                            76,894
Interest payable and similar charges                                  (116,594)
                                                                 ---------------
                                                                          
Loss on ordinary activities before taxation                         (1,027,624)

Tax charge on loss on ordinary activities                                    -

Loss on ordinary activities after taxation                          (1,027,624)
                                                                 ---------------
                                                                          
Dividends paid and proposed                                                  -
                                                                 ---------------
                                                                          
Retained loss for the financial period transferred to
reserves                                                            (1,027,624)
                                                                 ===============

The profit and loss account above is required by the Companies Act 1985 and
covers the first statutory accounting reference period of D1 Oils plc from its
date of incorporation on 24 August 2004 to 31 December 2004.

Disclosure notes for this period are not presented as the directors do not
believe they would provide meaningful information to users of the accounts.

Directors' remuneration for this period is included within the amounts disclosed
in Note 6 which covers remuneration for the 52 weeks to 31 December 2004.
Amounts for the period 24 August 2004 to 31 December 2004 in respect of salaries
and other time related costs can be derived by apportioning the annual amounts.




27. RELATED PARTY TRANSACTIONS

During the year ended 31 December 2004 the Group incurred consultancy costs of
£100,000 to RedComm Limited, a company in which Karl Watkin is a director and
shareholder, £100,000 consultancy costs to Global Trading Group Limited, a
company in which M Quinn is a director and shareholder and £66,667 consultancy
costs to Almegar Solutions, a company in which A Worrall is a director and
shareholder. All transactions are at arms' length. At the year end RedComm
Limited owed the Group £5,512, Almegar Solutions Limited owed the Group £5,502
and Global Trading Group Limited owed the Group £22,055. There were no
equivalent transactions during the 49 weeks ended 31 December 2003.

In 2003 directors loans had been made to fund the operating expenses of the
company. The amounts owed to the directors at 31 December 2003 were K Watkin
£189,210; A Worrall £157,388 and M Quinn £48,568.

During the period the group reached an agreement to acquire intellectual
property rights relating to refineries from Steve Davis, a shareholder in the
company, for nil value and the group agreed to forego a debt of £149,770 owed to
Safety Issues (Fabrication) Limited, a company in which Steve Davis is a
director and shareholder.



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