12/24/2012 08:04 EST | Updated 02/23/2013 05:12 EST

Ontario biodiesel company jetisons plan for production plant in New York Harbor

TORONTO - Biox Corp. (TSX:BX) has terminated plans for a new biodiesel production facility in New York Harbor.

The Toronto-area company says the market dynamics have changed significantly since it signed a land lease agreement with International-Matex Tank Terminals.

As a result of the decision, IMIT will reimburse two-thirds of the US$2.1-million upfront payment made by Biox.

Biox will record the remaining $700,000 as an expense in its fiscal first quarter.

The Oakville-headquartered company says it believes the challenges affecting the biodiesel market in 2012 are short-term.

Biox chief executive says the company remains confident in the value of its production facility in Hamilton, Ont.