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Buckeye Announces CottonFloZ Licensing Agreement with Chickasha of Georgia, LLC

MEMPHIS, TN November 8, 2004 - Buckeye Technologies Inc. (NYSE:BKI) announced today that CottonFloZ, LLC, BKI’s joint venture with Z Pellet Enterprises, Inc. of Weldon, NC, has entered into a licensing agreement with Chickasha of Georgia, LLC to produce FuzZpellets, a pelletized whole cottonseed for the dairy and beef feed industries. Under this agreement, Chickasha will begin producing FuzZpellets™ in the second quarter of calendar year 2005 after the manufacturing facility has been constructed.

Mr. John Crowe, President of Buckeye Technologies, commented that, “We are pleased to have Chickasha, a recognized leader in the oil milling industry, as a partner in this important venture. FuzZpellets™ offer significant advantages to the end-user. These include handling and bulk density improvements as well as better nutritional performance than whole cottonseed. We look forward to working with Chickasha to bring this valuable additional supply capacity to the marketplace.”

Michael Dunlow, President of Z Pellet Enterprises, Inc. stated, “This facility will help satisfy an increasing demand for the product from our customer base and help us expand into new markets that can be effectively served from the Georgia area.”

Andy Borem, President of Chickasha of Georgia, LLC is also optimistic about the partnership. Mr. Borem said, “We believe that this addition to our facility will provide a good complement to our existing whole cottonseed merchandising and oil mill operation and we look forward to expanding our presence in the feed markets with this product.”

Georgia Entrepreneurs Showing Stong Interest in the Alternative-fuels Industry

TIFTON — For years, Chickasha of Georgia has been converting cotton seeds into feed for dairy cows and producing cottonseed oil for the snack-food industry.

More recently, the Tifton-based cooperative owned by some 1,500 cotton farmers has begun processing seeds into a premium form of cellulose used to make flat screens for computers.

But what Chickasha President Andy Borem has been thinking most about lately is adding a step at the end of his seed-oil manufacturing process to turn the material into biodiesel fuel, an environmentally friendly alternative to diesel that is quickly becoming a less expensive choice for consumers.

“We’re already doing the hard part — taking a seed and converting it into oil,’’ Borem said after leading a tour of his plant off Interstate 75 last month. “That’s why we’re such a fit to do it, if anybody is.’’

Borem is among a growing number of Georgia entrepreneurs showing strong interest these days in the alternative-fuels industry. Politicians are taking notice, too. The push to develop alternative fuels using Georgia crops is playing a part in this year’s race for state agriculture commissioner, as might be expected.

Borem said producing biodiesel fuel from vegetable oil holds the most immediate promise because the technology is more advanced. “Everybody’s talking about making a fuel out of something else, but 98 percent of the industry today is vegetable oil,’’ he said. “That’s where the industry is today. That’s where the investment is.’’

While Chickasha is set up only to produce cottonseed oil, Borem said it would be easy enough to switch the biodiesel portion of his operation to making oil from peanuts. Since Chickasha already has the equipment, he said the plant could produce biodiesel fuel for much less than the $1.20 to $1.50 per gallon it costs to make it from scratch. But Borem said he still hasn’t decided whether to take the plunge. He said if oil prices stay high, he would lean strongly toward launching a biodiesel project.