D&L Industries eyes second biodiesel plant

Chemicals giant D&L Industries Inc., through its wholly owned unit Chemrez Technologies, is planning to build a second biodiesel plant as it anticipates increased demand once the government lifts the suspension of the implementation of a 4% biodiesel blend requirement.

“What we announced was that we are planning and studying that second plant. We’re still there. It's still in the planning stages,” said D&L president and CEO Alvin Lao.

“I would say it's probably a matter of when, not if. Meaning, there's a high probability we will make a second plant. But, in terms of when, how big, and how much we'll spend, we still do not have that information since we are still in the planning stage,” he said.

The National Biofuels Board earlier suspended the implementation of the 4% (B4) and 5% (B5) biodiesel blend mandates originally scheduled to take effect by October 1, 2025, and October 1, 2026, respectively.

The government’s decision was "in view of the anticipated significant impact on pump prices and the potential inflationary effects on the national economy" as coconut oil prices remain high due to supply challenges faced by coconut farmers.

Lao said that the plan to build a second biodiesel plant was “something we're very serious about.”

“We believe, for many reasons, it makes sense for us to consider a second plant even if the increase in the mandated blend has been postponed,” added the D&L chief.

“The increase has been postponed and not canceled. So, this means it will still push through at a later date. So, in that sense, it would still make sense to proceed with more capacity for biodiesel."

He said that with D&L’s Batangas plant now completed and no other major capital expenditures in the pipeline, the firm has the financial flexibility to potentially undertake the construction of a new biodiesel facility, which would require much smaller capex. –VBL, GMA Integrated News