WOODLAWN -- State authorities have charged a 32-year-old man with illegally selling his own brand of privately mixed diesel fuel, but the manufacturer said Monday it was all the result of a misunderstanding.

Samuel Floyd Bolt, who lives near Willis in Floyd County, said he was unaware that he needed a state license to sell his product.

"Biodiesel's what we're making," he said at his Carroll County location near Woodlawn, where he is also developing a mobile home park.

State Division of Motor Vehicles agents arrested Bolt on Aug. 22 on charges of dispensing fuels without being a licensed retailer and dispensing fuels into highway vehicles, both misdemeanors, and failure to pay fuel taxes, a felony.

Bolt immediately posted a $5,000 bond and worked with hazardous-materials people in making sure his ingredients were handled under federal Occupational Health and Safety Act standards.

He is scheduled to appear in Carroll County General District Court on Oct. 20.

"The only real issue that the DMV guys had over this was to have a tax certificate," Bolt said. He said he has since contacted the DMV office in Richmond and applied for it.

The investigation followed a tip by an informant. Assistant Special Agent Gene Reece and Senior Special Agent M.F. Hall began a six-week surveillance of the building owned by Bolt at 26 Cedar Brook Lane in Woodlawn, west of Hillsville in Carroll County. They were assisted by Assistant Special Agent Jim Crump of Staunton and Senior Special Agent Shannon Boyette of Roanoke.

Ken Smith, special agent in charge in the DMV Bristol office, said Monday that about 15 customers were observed receiving the homemade diesel fuel. He said charges against some of them are possible as the investigation continues.

"They should have been very aware of what they were getting because of the price he was charging," Smith said.

Investigators said Bolt was selling his fuel for about $1.86 a gallon. Diesel fuel is averaging slightly more than $3 a gallon nationally, according to the U.S. Energy Information Administration. Lower Atlantic and East Coast prices range from $2.85 to $2.89 a gallon.

Smith said the operation apparently attracted its customers by word of mouth. At the price for which it was being sold, he said, "Word spreads pretty quickly."

Bolt said he and his wife were making biodiesel for their own use, and he realized they were producing more than they needed. That was when he started selling it, he said.

He said he didn't know he was breaking the law by selling without a license.

"Obviously, we don't want to do that," Bolt said. He said it is a serious issue and, now that he understands the procedures, he wants to make his product legally.

He said the ingredients consisted of used vegetable oil collected from restaurants in Roanoke and North Carolina, and methanol and lye that combine as a catalyst to put the cooking oil back in its original state.

He said anyone can manufacture biodiesel. He used devices he ordered off the Internet, he said, but they could as easily have been bought off the shelf at hardware stores.

"It's less polluting than your fossil-fuel diesel," he said. "What we're doing now, it might be 300 gallons a week. But the potential of it in this area, it's phenomenal."

Smith said cleanup workers had to remove more than 450 gallons of methanol and 150 gallons of the other materials.

He said the materials might have been toxic or flammable. The location is near Woodlawn Intermediate School and the Southwest Virginia Training Center for the mentally handicapped, and in the middle of Bolt's trailer court.

"We're talking about some pretty hazardous materials," Smith said. "It was a dangerous situation with a potential for some really bad consequences."

Carroll County Commonwealth's Attorney Gregory Goad allowed DMV to release the building back to Bolt when he made bond, which made him responsible for the cleanup, Smith said. Bolt was required to sign a document promising to dispose of the chemicals in a manner meeting Occupational Health and Safety Act standards, which was done within a day.

Smith said this is the first case of its kind that he knows about.

"This is a very unusual circumstance," Smith said.

Bolt said he hopes to work out an agreement with Carroll County authorities in the future to sell them biodiesel fuel for their off-road vehicles, such as backhoes. He predicted more people will go to such alternative fuels as commercial costs continue to rise.

"I want more people to do this," Bolt said.