Tuesday, December 6, 2005

Nine Licences Issued For Production Of Bio-diesel - Malaysian National News Agency :: BERNAMA

December 06, 2005 16:28 PM E-mail this news to a friend Printable version of this news

Nine Licences Issued For Production Of Bio-diesel

KUALA LUMPUR, Dec 6 (Bernama) -- Nine licences have been issued for the production of bio-diesel, said Plantation Industries and Commodities Minister, Datuk Peter Chin Fah Kui Tuesday.

Speaking to reporters after officiating a biodiesel symposium on Renewables Made in Germany here, he said investment proposals had been submitted to the Malaysian Industrial Development Authority (MIDA) from various parties including from Singapore and Italy.

Currently, three bio-diesel companies have been chosen to partner Malaysian Palm Oil Board (MPOB) to build three bio-diesel plants, which will have a combined capacity of 180,000 tonnes of bio-diesel a year.

The plants which would cost a total RM120 million would be built primarily for export to the world market and to help reduce dependence on fossil fuel, he said.

It was reported that work on the Carotino plant had started on Nov 1, 2005 and due commissioning at end-2006 while the other two plants (Golden Hope and Fima), due to commission by early 2007, were in the process of selecting the engineering contractors.

In his address, Chin said there was a high demand for biodiesel from the West especially in Europe such as Germany and Italy as well as other countries like Turkey, South Korea, India and Colombia.

Global demand for biodiesel is expected to touch 10.5 million in the next few years and Malaysia has the potential to capture 10 percent of that market by producing up to one million tonnes.

Germany alone has an annual demand of two million tonnes, he said.

"Its train operator Prignitzer Eisenbahn (PE) Arriva which had earlier purchased 50 tonnes of Malaysia's biodiesel, has displayed satisfaction with their trial run early September this year and has placed additional palm oil order for another 100 tonnes of the fuel," he said.

Germany is today the largest producer and user of biofuel and its technology holds a leading position in the fields of biofuel production based on sources like rapeseed, sunflowers, soya bean and palm oil.

"With the supply of palm oil continuously and readily available, it is hoped that the Malaysian palm oil industry will be able to participate extensively in the development of the fuel industry in time to come," the minister said.

The same goes for other commodities, whereby Brazil had diverted its sugar production for ethanol as well as part of the supply of the corn industry in the United States.

Europe's rapeseed industry is starting to divert supply for fuel in accounting for 40 percent of production, and with greater demand, the price of the commodity too had increased by RM1,000 more than palm oil.

The Malaysian government itself had in August unveiled more proposals for medium-term implementation in the National Biofuel Policy.

It was decided that the palm oil composition in the biofuel blend will be at 5.0 percent processed palm oil and 95 percent petroleum diesel.

The blending of 5.0 percent, he said, would require 500,000 tonnes of palm oil annually which would cause the stock to be short by 40-50 percent and in turn would increase the price of palm oil accordingly.

During the press conference, the minister was also asked on the outlook and other developments for palm oil.

He said demand was good this year and expected to pick up because of biodiesel needs.

Chin said he would also be going to China to talk to his counterpart as well as meet the importing agencies there with regard to the conditions as well as limitations on the importation of palm oil despite the lifting of the quotas.

The import tariff rate quota on edible oil in China will be eliminated next year as part of its commitment to the World Trade Organisation (WTO) since becoming a member in December 2001.

China's palm oil quota had expanded from 2.4 million tonnes in 2002 to 3.168 million tonnes in 2005.

-- BERNAMA


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