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    Cuban livestock farmers are buying distillers dried grains (DDG), the main byproduct of ethanol, from biofuel producers in the U.S. During a trade mission of Iowan officials to Cuba, trade officials there said the communist state will double its purchases of the dried grains this year. DesMoines Register - October 9, 2007.

    Singapore water treatment firm Hyflux has teamed up with BP and the Dalian Institute of Chemical Physics to develop and commercialise membranes for the production of biofuels. A first project involves using a zeolite to dewater bio-ethanol. Reuters - October 9, 2007.

    Brasil Ecodiesel, the leading Brazilian biodiesel producer company, recorded an increase of 57.7% in sales in the third quarter of the current year, in comparison with the previous three months. Sales volume stood at 53,000 cubic metres from August until September, against 34,000 cubic metres of the biofuel between April and June. The company is also concluding negotiations to export between 1,000 to 2,000 tonnes of glycerine per month to the Asian market. ANBA - October 4, 2007.

    PolyOne Corporation, the US supplier of specialised polymer materials, has opened a new colour concentrates manufacturing plant in Kutno, Poland. Located in central Poland, the new plant will produce colour products in the first instance, although the company says the facility can be expanded to handle other products. In March, the Ohio-based firm launched a range of of liquid colourants for use in bioplastics in biodegradable applications. The concentrates are European food contact compliant and can be used in polylactic acid (PLA) or starch-based blends. Plastics & Rubber Weekly - October 2, 2007.

    A turbo-charged, spray-guided direct-injection engine running on pure ethanol (E100) can achieve very high specific output, and shows “significant potential for aggressive engine downsizing for a dedicated or dual-fuel solution”, according to engineers at Orbital Corporation. GreenCarCongress - October 2, 2007.

    UK-based NiTech Solutions receives £800,000 in private funding to commercialize a cost-saving industrial mixing system, dubbed the Continuous Oscillatory Baffled Reactor (COBR), which can lower costs by 50 per cent and reduce process time by as much as 90 per cent during the manufacture of a range of commodities including chemicals, drugs and biofuels. Scotsman - October 2, 2007.

    A group of Spanish investors is building a new bioethanol plant in the western region of Extremadura that should be producing fuel from maize in 2009. Alcoholes Biocarburantes de Extremadura (Albiex) has already started work on the site near Badajoz and expects to spend €42/$59 million on the plant in the next two years. It will produce 110 million litres a year of bioethanol and 87 million kg of grain byproduct that can be used for animal feed. Europapress - September 28, 2007.

    Portuguese fuel company Prio SA and UK based FCL Biofuels have joined forces to launch the Portuguese consumer biodiesel brand, PrioBio, in the UK. PrioBio is scheduled to be available in the UK from 1st November. By the end of this year (2007), says FCL Biofuel, the partnership’s two biodiesel refineries will have a total capacity of 200,000 tonnes which will is set to grow to 400,000 tonnes by the end of 2010. Biofuel Review - September 27, 2007.

    According to Tarja Halonen, the Finnish president, one third of the value of all of Finland's exports consists of environmentally friendly technologies. Finland has invested in climate and energy technologies, particularly in combined heat and power production from biomass, bioenergy and wind power, the president said at the UN secretary-general's high-level event on climate change. Newroom Finland - September 25, 2007.

    Spanish engineering and energy company Abengoa says it had suspended bioethanol production at the biggest of its three Spanish plants because it was unprofitable. It cited high grain prices and uncertainty about the national market for ethanol. Earlier this year, the plant, located in Salamanca, ceased production for similar reasons. To Biopact this is yet another indication that biofuel production in the EU/US does not make sense and must be relocated to the Global South, where the biofuel can be produced competitively and sustainably, without relying on food crops. Reuters - September 24, 2007.

    The Midlands Consortium, comprised of the universities of Birmingham, Loughborough and Nottingham, is chosen to host Britain's new Energy Technologies Institute, a £1 billion national organisation which will aim to develop cleaner energies. University of Nottingham - September 21, 2007.

    The EGGER group, one of the leading European manufacturers of chipboard, MDF and OSB boards has begun work on installing a 50MW biomass boiler for its production site in Rion. The new furnace will recycle 60,000 tonnes of offcuts to be used in the new combined heat and power (CHP) station as an ecological fuel. The facility will reduce consumption of natural gas by 75%. IHB Network - September 21, 2007.

    Analysts fear that record oil prices will fuel general inflation in Kenya, particularly hitting the poorest hard. They call for the development of new policies and strategies to cope with sustained high oil prices. Such policies include alternative fuels like biofuels, conservation measures, and more investments in oil and gas exploration. The poor in Kenya are hit hardest by the sharp increase, because they spend most of their budget on fuel and transport. Furthermore, in oil intensive economies like Kenya, high oil prices push up prices for food and most other basic goods. All Africa - September 20, 2007.

    Finland's Metso Power has won an order to supply Kalmar Energi Värme AB with a biomass-fired power boiler for the company’s new combined heat and power plant in Kalmar on the east coast of Sweden. Start-up for the plant is scheduled for the end of 2009. The value of the order is approximately EUR 55 million. The power boiler (90 MWth) will utilize bubbling fluidized bed technology and will burn biomass replacing old district heating boilers and reducing the consumption of oil. The delivery will also include a flue gas condensing system to increase plant's district heat production. Metso Corporation - September 19, 2007.

    Jo-Carroll Energy announced today its plan to build an 80 megawatt, biomass-fueled, renewable energy center in Illinois. The US$ 140 million plant will be fueled by various types of renewable biomass, such as clean waste wood, corn stover and switchgrass. Jo-Carroll Energy - September 18, 2007.

    Beihai Gofar Marine Biological Industry Co Ltd, in China's southern region of Guangxi, plans to build a 100,000 tonne-per-year fuel ethanol plant using cassava as feedstock. The Shanghai-listed company plans to raise about 560 million yuan ($74.5 million) in a share placement to finance the project and boost its cash flow. Reuters - September 18, 2007.

    The oil-dependent island state of Fiji has requested US company Avalor Capital, LLC, to invest in biodiesel and ethanol. The Fiji government has urged the company to move its $250million 'Fiji Biofuels Project' forward at the earliest possible date. Fiji Live - September 18, 2007.

    The Bowen Group, one of Ireland's biggest construction groups has announced a strategic move into the biomass energy sector. It is planning a €25 million investment over the next five years to fund up to 100 projects that will create electricity from biomass. Its ambition is to install up to 135 megawatts of biomass-fuelled heat from local forestry sources, which is equal to 50 million litres or about €25m worth of imported oil. Irish Examiner - September 16, 2007.

    According to Dr Niphon Poapongsakorn, dean of Economics at Thammasat University in Thailand, cassava-based ethanol is competitive when oil is above $40 per barrel. Thailand is the world's largest producer and exporter of cassava for industrial use. Bangkok Post - September 14, 2007.

    German biogas and biodiesel developer BKN BioKraftstoff Nord AG has generated gross proceeds totaling €5.5 million as part of its capital increase from authorized capital. Ad Hoc News - September 13, 2007.

    NewGen Technologies, Inc. announced that it and Titan Global Holdings, Inc. completed a definitive Biofuels Supply Agreement which will become effective upon Titan’s acquisition of Appalachian Oil Company. Given APPCO’s current distribution of over 225 million gallons of fuel products per year, the initial expected ethanol supply to APPCO should exceed 1 million gallons a month. Charlotte dBusinessNews - September 13, 2007.

    Oil prices reach record highs as the U.S. Energy Information Agency releases a report that showed crude oil inventories fell by more than seven million barrels last week. The rise comes despite a decision by the international oil cartel, OPEC, to raise its output quota by 500,000 barrels. Reuters - September 12, 2007.

    OPEC decided today to increase the volume of crude supplied to the market by Member Countries (excluding Angola and Iraq) by 500,000 b/d, effective 1 November 2007. The decision comes after oil reached near record-highs and after Saudi Aramco announced that last year's crude oil production declined by 1.7 percent, while exports declined by 3.1 percent. OPEC - September 11, 2007.

    GreenField Ethanol and Monsanto Canada launch the 'Gro-ethanol' program which invites Ontario's farmers to grow corn seed containing Monsanto traits, specifically for the ethanol market. The corn hybrids eligible for the program include Monsanto traits that produce higher yielding corn for ethanol production. MarketWire - September 11, 2007.

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Tuesday, October 09, 2007

Petrobras: ethanol sales to exceed gasoline in Brazil by 2020, Petrobras to shrink oil business to focus on biofuels

According to Sergio Gabrielli, chief executive of state-run oil firm Petroleo Brasileiro SA (Petrobras), Brazil could become the first country to consume more biofuels than gasoline in the near future. Brazilians will use more ethanol than the petroleum fuel by 2020 when flex-fuel cars will dominate the country's car fleet. The rapid rise in the sale of flex-fuel cars, which can run on any mixture of gasoline and ethanol, is the main reason behind the expected jump in ethanol sales.

Across most of Brazil, ethanol made from sugar cane is considerably cheaper than gasoline on an energy equivalent basis. Record sugar harvests and ethanol output combined with very high oil prices have tilted the balance firmly in favor of the biofuel. The effect can be felt throughout the economy, as cheap ethanol has contributed to lowering inflation (earlier post). Moreover, as a highly efficient and environmentally sustainable biofuel, Brazilian ethanol is not confronted with the food versus fuel dilemma. In fact, world sugar prices have been falling despite record ethanol output (more here).

In theory, Brazil has the agro-ecological resources to produce enough biofuels to meet the entire world's gasoline demand (here). But some experts counter-intuitively fear abundant and cheap ethanol is becoming a problem for Brazil, as oversupplies cannot be absorbed fast enough by the local market. To avoid becoming a victim of its own success, the country must therefor urgently succeed in opening export markets (earlier post).

Petrobras wants to contribute to this effort. The company expects to become the first major oil producer to shift its core activities away from oil to open the era of bio-based fuels that can be grown over and over again. According to Gabrielli Petrobras is already 'announcing the shrinking' of its business of selling oil products.

Flex-fuel cars were introduced by major carmakers in Brazil in 2003, but sales have shot up spectacularly and now represent 85% of all new car sales (earlier post for 2006 figures). By 2020, Petrobras expects flex-fuel cars to make up 71.5% of Brazil's light-vehicle fleet, up from 12.8% in 2006. The fleet of gasoline cars is headed in the opposite direction, and is expected to shrink to 13.4% from 70.8% in the same period:
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Considering a likely continuation of price advantages for ethanol in the Brazilian market, ethanol will represent 57% of the consumption of flex-fuel cars in 2020, Gabrielli added.

The company recently said it plans to enter ethanol production and will buy stakes in up to 40 Brazilian ethanol mills. The company has already laid out plans to become a major ethanol exporter. Recently it commenced implementing its long term plan's first phase by investing in 20 new ethanol plants (earlier post).

Brazil is the world's second-largest producer of ethanol behind the U.S., and is the world's largest exporter. It also has the highest usage of biofuels of any country, accounting for almost 18% of liquid transport fuel needs, Energy Minster Nelson Hubner said Thursday.

Petrobras expects Brazil to consume 29.6 billion liters of ethanol in 2020, up from 12.5 billion from the 2006-2007 harvest season, Gabrielli said. The country's ethanol exports in the same period are expected to jump to 16.5 billion liters from the current 3.4 billion.

Despite the increasing use of ethanol among light vehicles, Petrobras estimated diesel fuel will retain its position as Brazil's most widely used transport fuel across all vehicle types, accounting for 50.5% of automotive fuels consumed in Brazil in 2020, down slightly from 52.5% in 2006.

The government has mandated that diesel, used mainly by trucks and buses, must be mixed with 2% biodiesel from 2008, rising to a 5% blend from 2013. Biodiesel, made from plants such as soy, castor beans, jatropha or sunflower seeds, is expected to represent 2.6% of automotive fuel sales in 2020.

Compressed natural gas, or CNG, will increase its market share from 4.3% in 2006 to 7.4% in 2020, Petrobras reckons. Brazil and neighboring Argentina currently have the world's largest fleets of vehicles running on CNG.

Petrobras also expects hybrid vehicles to gain a foothold in the Brazilian market early in the next decade, but doesn't think they will start playing a significant role in Brazil for a long time. Hybrid vehicles combine combustion engines running on fuels with electric motors in order to save fuel and reduce emissions of greenhouse gases.

: Brazil's President Lula showcasing a tri-fuel vehicle capable of running on ethanol, gasoline, and natural gas.

Dow Jones Newswires: Ethanol Sales To Exceed Gasoline In Brazil By 2020-Petrobras - October 8, 2007.

Biopact: Petrobras starts approving joint ventures worth $1 billion to set up 20 new ethanol plants - September 27, 2007

Biopact: Flex-fuel vehicles in Brazil hit 2 million mark, make up 77% of the market - August 18, 2006

Biopact: Inflation in Brazil decreased more than expected on lower ethanol, food prices - September 21, 2007

Biopact: Experts: Brazil victim of its own biofuels success, as ethanol price collapses - September 21, 2007

Biopact: Brazilian biofuels can meet world's total gasoline needs - expert - May 21, 2007

Biopact: Brazilian ethanol is sustainable and has a very positive energy balance - IEA report - October 08, 2006


rufus said...

So, One Question: Why haven't they pressured the auto companies to manufacture a "true" ethanol-optimized engine?

They have ethanol everywhere, and it would give much better performance, and "efficiency," than a flex-fuel engine optimized for gasoline, or, 20% ethanol (an engine I've heard that they DO have.)

4:54 PM  

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