Fledgling bioethanol firm Green Spirit Fuels has announced radical changes to its management board.

Managing director Malcolm Shepherd and finance director Arthur Llewellyn have stepped down on agreed terms following a “strategy review” with Green Spirit’s parent company Wessex Grain.

Mr Shepherd and Mr Llewellyn led the development of Green Spirit Fuels in June 2005 and attracted £1.7m in early funding from merchant banker Tudor Capital and bank Credit Suisse.

The project secured planning permission and supply, engineering and construction contracts for its site at Henstridge, Somerset, through its subsidiary Wessex Biofuels.

The two men also agreed a deal with HSBC to fund the debt element of the £85m project cost.

In a statement, they said that parent company Wessex Grain was continuing negotiations for improvements to the equity offer put forward.

Mr Llewellyn has an established consultancy business, HFH Management, based in Somerset. Mr Shepherd is also understood to be pursuing consultancy interests, particularly in the renewable energy sector.

New Green Spirit chairman Owen Yeatman praised their “tremendous” efforts in establishing Green Spirit Fuels.

Simon Wilcox, formerly managing director of Wessex Grain, joins Green Spirit Fuels as chief executive. In a statement he said: “GSF has a really strong and experienced operational team who are all very motivated, but perhaps lacked the experience necessary in financial project management and operating in the City that will be required for this project.”

Mr Wilcox said the firm was progressing on raising equity to begin construction on the Henstridge plant later this year. If successful, the factory is expected to begin bioethanol production in autumn 2008.