Dutch company eyes ethanol facility in PH

The Netherlands-based North Sea Group is considering building Asia’s biggest ethanol facility in the Philippines.

At the sidelines of a biofuels conference Thursday, Energy Undersecretary Jose M. Layug Jr. said the company was hoping to build an ethanol facility that would have the capacity to produce as much as 400 million liters.

“They can be bullish because we mandated 10-percent ethanol blending (fully effective February 2012). Given that production is insufficient to meet the government mandate, a lot of these biofuel producers are now looking into the Philippines,” Layug said.

The proposed facility, the feasibility of which is still being studied, will be multi-feedstock, meaning it can use different feedstock such as cassava, sorghum and sugarcane.

“Their technology allows for different types of feedstock. North Sea wants to build an ethanol plant but they also need to study the feasibility of the feedstock in the area.  Right now they said they’re looking around for potential areas,” Layug added.

At present, only three companies are producing ethanol—San Carlos Bioenergy Inc., Roxol Bioenergy and Leyte Agri Corp. Their capacities run up to 80 million liters but actual production was less.

Total demand for ethanol this year was estimated at 265 million liters while estimated supply remained marginal at 29 million liters, or only 10 percent of the requirement.

Currently, local ethanol producers are still awaiting the issuance of guidelines for pricing and the allocation of locally produced ethanol among oil companies.

The Department of Energy (DoE) said it was taking its time in signing the circular providing the guidelines to protect the public from unwarranted spikes in local pump prices.

“The oil companies and ethanol producers presented their position papers on the latest version of the circular. I asked them to consider the new comments that were submitted. We’re close to finalizing it. (We’re discussing) the pricing formula, whether it’s open ended or not,” said Energy Secretary Jose Rene D. Almendras.

“Our concern is the impact on pump prices. While we know they (investors) also need to make money, we also need to make sure that we will not have a situation where pump prices will go up too high,” he said.

“We want to enhance the development of the local ethanol industry but we don’t want to increase local gasoline prices, and that is the difficult part,” Layug said.

According to Layug, the DoE is hoping it could soon issue the circular as this was expected to help boost the ailing local ethanol industry.