4 oil firms to put up Davao biodiesel plant

Four oil companies have banded together to put up a biodiesel plant in Coronon, Davao that will start operations in March. Flying V, Eastern Petroleum Corp., Seaoil Philippines and Unioil made the announcement less than a week after President Gloria Macapagal Arroyo said she had signed the Biofuels Act of 2006 into law. Flying V spokesman Macky Lopez said the group would infuse about P50 million for the plant, which is eyed to supply half of the country’s yearly biodiesel requirements. “The investment is roughly P50 million because there is already an oil mill in the area," Lopez said. The plant for methyl-ester, an oil product used to make alternative fuel, will initially produce 30 million liters annually to supply local needs. Lopez said they are also eyeing to export biodiesel to other parts of Asia. “Our primary target is Japan. We are already in talks with a Japanese firm," he said. The plant will be operated by Bioenergy8 Corp., a company jointly owned by Flying V and Enerfuse Holdings, Inc., which is owned by the three other oil companies involved in the Coronon project. Other shareholders are coconut producers Golden Asian Oil, Mt. Holly Coco Industrial Co., a foreign-owned oil and trading company and other local investors. "The biodiesel plant will help the government achieve its goal of energy independence. We, at the petroleum industry, remain committed in joining hands with the government to promote alternative fuels," Lopez said. The Flying V spokesman also noted that Mindanao will easily be able to supply the raw materials needed in the plant's production of methyl-ester because the Philippines’ second largest island accounts for 40 percent of local coconut plantations. Mindanao produces 58 percent of the 1.7 billion liters total coco oil produced by the country each year. Lopez added that Bioenergy8 Corp may also put up another plant in Luzon. The Biofuels Act of 2006 mandates the blending of biodiesel in gasoline. Estimates from the energy department show that use of 1 percent biodiesel and 5 percent bioethanol this year would save the country about $167 million annually. In 2010, use of 10 percent bioethanol and 2 percent biodiesel is sent to result in annual foreign exchange savings of about $389 million. -GMANews.TV