Firm to spend P8B on two ethanol plants

MANILA, Philippines - Bronzeoak Philippines, Inc. is spending P8 billion to build two more ethanol plants in the next two years here as it tries to meet the demand for clean energy pursuant to a law that mandates a cleaner fuel blend. Bronzeoak Philippines President and Chief Operating Officer Jose Maria T. Zabaleta told reporters the company was setting up the plants in Metro Manila and the Visayas to meet the demand of its major client, Petron Corp. Bronzeoak, through San Carlos Bionergy, Inc., supplies ethanol to the country's largest oil company for its E10 Premium oil brand. "We are looking at putting up two more plants somewhere near Metro Manila and in the Visayas in the next two years," Mr. Zabaleta said, noting that ethanol demand is expected to shoot up once the mandate for ethanol blend takes effect next year. UK-based Bronzeoak Ltd. is a leading developer of bioethanol and bioenergy production facilities worldwide. The group's businesses focus on bioethanol developments in Southeast Asia and Africa, and on bioenergy developments in Britain. Bronzeoak Philippines is a local company jointly owned by the British firm and Zabaleta & Co. It was set up in June 2003 to develop new renewable energy projects in the Philippines. San Carlos Bioenergy is a joint venture of the two firms. Mr. Zabaleta said an ethanol plant costs around P4 billion. He declined to give further details, but said that the company was partnering with local and foreign investors. Under the Biofuels Law, 5% ethanol should be mixed with gasoline to cut the country's dependence on imported oil by 2009. The ethanol blend will be hiked to 10% by 2011. Bronzeoak expects to sell 30 million liters of ethanol per year to Petron, which requires 70 million liters for its new fuel line. Ethanol is a high-octane, water-free alcohol produced from sugarcane and other crops such as corn, cassava and sweet sorghum. It is used as a blending component at 5% to 10%. The use of ethanol as an additive is said to reduce greenhouse gas emissions. Petron, the country's biggest oil firm, has launched E10 Premium in answer to the government's call for fuel cleanliness and affordability. Petron's E10 Premium, which has 10% ethanol and 90% Petron Premium unleaded gasoline and an enhanced fuel additive, is the first in the country to meet the required 5% ethanol blend in gasoline. It is available in 14 Petron gasoline stations in Metro Manila. Bronzeoak Philippines earlier said it was putting up a sugar mill, cogeneration plant and distillery complex for ethanol production in San Carlos, Negros Occidental. The facility can produce 125,000 liters of ethanol daily. The plant is expected to be operational by yearend. - Ava Kashima K. Austria, BusinessWorld