Vega Biofuels, Inc. announced that it has entered into a Joint Venture Agreement to manufacture and market the green-energy product, Bio-Coal. The Joint Venture company includes Vega Biofuels and Laoc, Inc. The Joint Venture will operate under the name of LV, Inc. and will operate from Laoc's facility in Richlands, VA. Vega Biofuels recently entered into an Agreement with Vencor International, Inc. to manufacture the company's Bio-Coal energy product on an exclusive basis.

Vencor International has since ceased operations prompting Vega to go directly to Mr. Vance for production of its Bio-Coal product. The two companies have been working together recently to meet the requirements of Vega's clients and testing of the torrefied wood product exceeded the requirements to be called Bio-Coal. Manufactured from timber waste using torrefaction technology, Bio-Coal has a high energy density of up to 13,000 BTUs/Lb and is considered a renewable energy fuel that meets the Renewable Portfolio Standards and Renewable Energy Credits (RECs) in the United States.

Both Vega Biofuels and Laoc, Inc. will market products manufactured by the JV. Profits derived from the JV will be shared equally between the parties. Vega will be responsible for all decisions associated with marketing the products of the JV and Laoc, Inc. will be responsible for all decisions associated with production of the JV's products.

In order to finance the new venture, Vega Biofuels has undergone a reorganization of its securities and is planning a Private Placement of its common shares.