Empire Diversified Energy, Inc. (EDE) is currently developing a hybrid alternative fuel pellet (HAFP) that is intended to allow utilities and other enterprises that currently burn solid and gaseous fuel sources to transition from these traditional sources to HAFP’s. HAFP’s are produced using a proprietary blend of environmentally friendly chemicals, coal fines (reclaimed coal from past coal mining) and silica, producing a fuel source that has similar characteristics to thermal steam coal. The HAFP’s can also employ wood chips in its blend to make the HAFP’s even more flexible in its uses and allow for export to Europe, where wood pellets are utilized but produce a significantly lower energy output.

The Company is currently testing and working with blends of coal and wood mixtures to create the perfect hybrid pellet for international distribution, and firmly believes it can achieve an early-mover advantage in this space. EDE is in negotiations to secure a multi-million dollar financial guarantee to acquire the land and mineral rights to the refuse coal being used to produce the pellets

Additionally, EDE is currently developing its own proprietary binding agent that will be filed with the appropriate worldwide patent agencies to become patent protected. This binding agent will allow HAFP’s to be utilized across a broader range of platforms, allowing EDE to introduce its HAFP’s to older utilities, cement manufacturers, aluminum and steel manufacturers.

It is anticipated EDE will be in extensive negotiations and testing with major power plants throughout the southeastern United States in the near future, and it is Management’s belief that the Company will enter into a long-term contract to provide pellets to a major public utility in late 2016.

EDE is also currently negotiating with several potential logistics partners to transport the pellets from Appalachia to a storage location near southern Georgia or Northeast Florida for immediate distribution to our customers. The Company has also identified several ports on the southeastern seaboard and is in negotiations to consummate joint venture relationships for distribution and exportation.