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    PetroChina Co Ltd, the country's largest oil and gas producer, plans to invest 800 million yuan to build an ethanol plant in Nanchong, in the southwestern province of Sichuan, its parent China National Petroleum Corp said. The ethanol plant has a designed annual capacity of 100,000 tons. ABCMoneyNews - December 21, 2007.

    Mexico passed legislation to promote biofuels last week, offering unspecified support to farmers that grow crops for the production of any renewable fuel. Agriculture Minister Alberto Cardenas said Mexico could expand biodiesel faster than ethanol. More soon. Reuters - December 20, 2007.

    Oxford Catalysts has placed an order worth approximately €700,000 (US$1 million) with the German company Amtec for the purchase of two Spider16 high throughput screening reactors. The first will be used to speed up the development of catalysts for hydrodesulphurisation (HDS). The second will be used to further the development of catalysts for use in gas to liquid (GTL) and Fischer-Tropsch processes which can be applied to next generation biofuels. AlphaGalileo - December 18, 2007.

    According to the Instituto Brasileiro de Geografia e Estatística (IBGE), Brazil's production of sugarcane will increase from 514,1 million tonnes this season, to a record 561,8 million tonnes in the 2008/09 cyclus - an increase of 9.3%. New numbers are also out for the 2007 harvest in Brazil's main sugarcane growing region, the Central-South: a record 425 million tonnes compared to 372,7 million tonnes in 2006, or a 14% increase. The estimate was provided by Unica – the União da Indústria de Cana-de-Açúcar. Jornal Cana - December 16, 2007.

    The University of East Anglia and the UK Met Office's Hadley Centre have today released preliminary global temperature figures for 2007, which show the top 11 warmest years all occurring in the last 13 years. The provisional global figure for 2007 using data from January to November, currently places the year as the seventh warmest on records dating back to 1850. The announcement comes as the Secretary-General of the World Meteorological Organization (WMO), Michel Jarraud, speaks at the Conference of the Parties (COP) in Bali. Eurekalert - December 13, 2007.

    The Royal Society of Chemistry has announced it will launch a new journal in summer 2008, Energy & Environmental Science, which will distinctly address both energy and environmental issues. In recognition of the importance of research in this subject, and the need for knowledge transfer between scientists throughout the world, from launch the RSC will make issues of Energy & Environmental Science available free of charge to readers via its website, for the first 18 months of publication. This journal will highlight the important role that the chemical sciences have in solving the energy problems we are facing today. It will link all aspects of energy and the environment by publishing research relating to energy conversion and storage, alternative fuel technologies, and environmental science. AlphaGalileo - December 10, 2007.

    Dutch researcher Bas Bougie has developed a laser system to investigate soot development in diesel engines. Small soot particles are not retained by a soot filter but are, however, more harmful than larger soot particles. Therefore, soot development needs to be tackled at the source. Laser Induced Incandescence is a technique that reveals exactly where soot is generated and can be used by project partners to develop cleaner diesel engines. Terry Meyer, an Iowa State University assistant professor of mechanical engineering, is using similar laser technology to develop advanced sensors capable of screening the combustion behavior and soot characteristics specifically of biofuels. Eurekalert - December 7, 2007.

    Lithuania's first dedicated biofuel terminal has started operating in Klaipeda port. At the end of November 2007, the stevedoring company Vakaru krova (VK) started activities to manage transshipments. The infrastructure of the biodiesel complex allows for storage of up to 4000 cubic meters of products. During the first year, the terminal plans to transship about 70.000 tonnes of methyl ether, after that the capacities of the terminal would be increased. Investments to the project totaled €2.3 million. Agrimarket - December 5, 2007.

    New Holland supports the use of B100 biodiesel in all equipment with New Holland-manufactured diesel engines, including electronic injection engines with common rail technology. Overall, nearly 80 percent of the tractor and equipment manufacturer's New Holland-branded products with diesel engines are now available to operate on B100 biodiesel. Tractor and equipment maker John Deere meanwhile clarified its position for customers that want to use biodiesel blends up to B20. Grainnet - December 5, 2007.

    According to Wetlands International, an NGO, the Kyoto Protocol as it currently stands does not take into account possible emissions from palm oil grown on a particular type of land found in Indonesia and Malaysia, namely peatlands. Mongabay - December 5, 2007.

    Malaysia's oil & gas giant Petronas considers entering the biofuels sector. Zamri Jusoh, senior manager of Petronas' petroleum development management unit told reporters "of course our focus is on oil and gas, but I think as we move into the future we cannot ignore the importance of biofuels." AFP - December 5, 2007.

    In just four months, the use of biodiesel in the transport sector has substantially improved air quality in Metro Manila, data from the Philippines Department of Environment and Natural Resources (DENR) showed. A blend of one percent coco-biodiesel is mandated by the Biofuels Act of 2007 which took effect last May. By 2009, it would be increased to two percent. Philippine Star - December 4, 2007.

    Kazakhstan will next year adopt laws to regulate its fledgling biofuel industry and plans to construct at least two more plants in the next 18 months to produce environmentally friendly fuel from crops, industry officials said. According to Akylbek Kurishbayev, vice-minister for agriculture, he Central Asian country has the potential to produce 300,000 tons a year of biodiesel and export half. Kazakhstan could also produce up to 1 billion liters of bioethanol, he said. "The potential is huge. If we use this potential wisely, we can become one of the world's top five producers of biofuels," Beisen Donenov, executive director of the Kazakhstan Biofuels Association, said on the sidelines of a grains forum. Reuters - November 30, 2007.

    SRI Consulting released a report on chemicals from biomass. The analysis highlights six major contributing sources of green and renewable chemicals: increasing production of biofuels will yield increasing amounts of biofuels by-products; partial decomposition of certain biomass fractions can yield organic chemicals or feedstocks for the manufacture of various chemicals; forestry has been and will continue to be a source of pine chemicals; evolving fermentation technology and new substrates will also produce an increasing number of chemicals. Chemical Online - November 27, 2007.

    German industrial conglomerate MAN AG plans to expand into renewable energies such as biofuels and solar power. Chief Executive Hakan Samuelsson said services unit Ferrostaal would lead the expansion. Reuters - November 24, 2007.

    Analysts think Vancouver-based Ballard Power Systems, which pumped hundreds of millions and decades of research into developing hydrogen fuel cells for cars, is going to sell its automotive division. Experts describe the development as "the death of the hydrogen highway". The problems with H2 fuel cell cars are manifold: hydrogen is a mere energy carrier and its production requires a primary energy input; production is expensive, as would be storage and distribution; finally, scaling fuel cells and storage tanks down to fit in cars remains a huge challenge. Meanwhile, critics have said that the primary energy for hydrogen can better be used for electricity and electric vehicles. On a well-to-wheel basis, the cleanest and most efficient way to produce hydrogen is via biomass, so the news is a set-back for the biohydrogen community. But then again, biomass can be used more efficiently as electricity for battery cars. Canada.com - November 21, 2007.

    South Korea plans to invest 20 billion won (€14.8/$21.8 million) by 2010 on securing technologies to develop synthetic fuels from biomass, coal and natural gas, as well as biobutanol. 29 private companies, research institutes and universities will join this first stage of the "next-generation clean energy development project" led by South Korea's Ministry of Commerce, Industry and Energy. Korea Times - November 19, 2007.

    OPEC leaders began a summit today with Venezuelan President Hugo Chavez issuing a chilling warning that crude prices could double to US$200 from their already-record level if the United States attacked Iran or Venezuela. He urged assembled leaders from the OPEC, meeting for only the third time in the cartel's 47-year history, to club together for geopolitical reasons. But the cartel is split between an 'anti-US' block including Venezuela, Iran, and soon to return ex-member Ecuador, and a 'neutral' group comprising most Gulf States. France24 - November 17, 2007.

    The article "Biofuels: What a Biopact between North and South could achieve" published in the scientific journal Energy Policy (Volume 35, Issue 7, 1 July 2007, Pages 3550-3570) ranks number 1 in the 'Top 25 hottest articles'. The article was written by professor John A. Mathews, Macquarie University (Sydney, Autralia), and presents a case for a win-win bioenergy relationship between the industrialised and the developing world. Mathews holds the Chair of Strategic Management at the university, and is a leading expert in the analysis of the evolution and emergence of disruptive technologies and their global strategic management. ScienceDirect - November 16, 2007.

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Tuesday, January 01, 2008

Brazil's biodiesel mandate comes into effect - data show success of 'Social Fuel Program'

All diesel sold in Brazil's 35,000 fuel stations will contain 2% biodiesel from today onwards. The B2 blend announces the start of president Lula's Pro-Biodiesel Program, which tries to replicate the success of the country's much feted Pro-Alcool Program, but which also aims to bring social and rural development to the poor. Preliminary data from the Agência Nacional do Petróleo (ANP) now show that the so-called 'Social Fuel Program' which plays a key role in biodiesel supplies is becoming a success, benefiting tens of thousands of Brazil's poorest farmers.

According ANP, the B2 blend - the first step of the Programa Nacional de Produção e Uso de Biodiesel (PNPB, 'Pro-Biodiesel') - will mean savings of around US$410 million per annum and a reduction of Brazil's dependency on imported diesel from 7 to 5%. The biodiesel blend will not affect the price of the fuel for the consumer, who will pay the same for a liter at the pump. According to the minister of Mines and Energy, Nelson Hubner, the compulsory mixing of the biofuel won't increase costs for fuel marketing companies either.

Importantly, the Ministry for Agricultural Development announces that 99% of the volume of the most recent biodiesel auctions, commercializing 380 million liters in anticipation of the B2 mandate, were based on fuel produced by companies who have obtained the 'Social Fuel Seal' (Selo Combustível Social).

This social fuel stamp is granted to biodiesel producers who buy their feedstock from small, family-run farms located in some of the country's most impoverished regions. The policy is based on interesting incentives (tax breaks) and access to finance from the Brazilian Development Bank (BNDES) and other participating financial institutions. An estimated 90,000 families are now registered and benefiting from the program. They are united in cooperatives and trained by extension workers and agricultural experts. The program is one of president Lula's social inclusion policies aimed at alleviating poverty and hunger.

The preliminary data on the 'social fuel' supplies were offered by the ANP, which carried out the auctions on December 13 and 14 in Rio De Janeiro. Out of a total of 27 manufacturers participating in the auctions, 24 operated under the Social Fuel Seal. According to Arnoldo De Campos, director of the department of Income and Value Creation at the Secretariat of Family-Run Agriculture (Geração de Renda e Agregação de Valor da Secretaria da Agricultura Familiar), "this demonstrates that it is a sufficiently competitive mechanism".

Inclusion of the Nordeste
According to the Ministry for Agricultural Development, currently about 90,000 families are benefiting from the pro-poor Pro-Biodiesel program. Around half of them can be found in the semi-arid Northeast of the country (the Nordeste), Brazil's poorest region. The Nordeste is notoriously difficult when it comes to rooting out poverty, with successive governments failing to improve the livelihoods of the region's largely rural population. However, with the new program, the Nordeste families now have an opportunity to sell products to a new and growing market; they are directly involved in the production of oil-seed crops for the manufacture of biodiesel (such as castor and jatropha) and have guaranteed access to buyers.

What is more, during the auctions, biodiesel produced in the Nordeste even took the major share of the sales with a percentage of 27,4%, followed by fuel produced in the Center-West (27,1%). With regard to states, the biggest participation came from the Rio Grande Do Sul (with a percentage of 21,6), followed by Goiás (20%) and Bahia (16,1%).

"These data show the force of family-run agriculture, since these states have the highest concentration of small-scale farmers in the country", says Campos.

The first signs of major success for Brazil's 'Social Fuel Policy' are important, because the scheme provides a potential model for replication in developing countries that want to produce biofuels while including small farmers:
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The B2 blend now compulsory in Brazil is hailed as a step towards a new era of relying on low carbon fuels, combining the best aspects of the highly successful Pro-Alcool program (which led to all gasoline in Brazil currently containing 25% of sugarcane ethanol), with a new vision on social and environmental sustainability. The biofuel is said to have a positive impact on the environment, as it reduces greenhouse gas emissions responsible for climate change.

The government is so optimistic about the adaptation of the market to the B2 mixture that it predicts it could give permission for a non-compulsory 3% blend in 2008, ahead of schedule.

To support its optimism, the government says Brazilian manufacturers already produced 450 million liters of biodiesel in 2007 with Petrobras having managed a strategic supply of 100 million liters which it distributed to 35,000 fuel stations across the country. The main barriers to distribution have now been overcome.

Brazil wants to have a mandatory 5% biodiesel blend in place by 2013. According to Hubner, the capacity expansion needed to achieve this target is being planned and commitments have been made by several companies to build biodiesel plants (note, Petrobras will be one of those, as it recently announced it will be building 10 biodiesel facilities over the coming years).

From today onwards, the B2 will be distributed with chemical markers that allow laboratories to track both the fuel's original manufacturer as well as the raw materials used to produce it. In Brazil, biodiesel is made from a range of vegetable oil feedstocks, with sunflower, soya, jatropha, palm oil and castor being the leading crops.

Picture: Small farmer from the semi-arid, impoverished Nordeste state participating in the Social Fuel policy. Credit: Petrobras.

Ministério do Desenvolvimento Agrário: Empresas com Selo Combustível Social vendem 99% do biodiesel comercializado nos leilões - December 2007.

Globo: Diesel com 2% de biodiesel começa a ser vendido nos postos - January 1, 2007.

Biopact: An in-depth look at Brazil's "Social Fuel Seal" - March 23, 2007.

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Colombian government invests $342 million in three ethanol projects; to employ former refugees

The Colombian government announced it is planning to invest around US$342 million in three new biofuel plants in the country in a public private partnership. The facilities will provide around 1500 direct jobs for internally displaced people who will be employed and trained with a view on their social reintegration. The projects were developed jointly by Colombia's High Council for Reintegration, the U.S. government economic and humanitarian assistance agency USAID and the the inter-governmental International Organization for Migration (IMO).

Under the project titled 'Etanol Caribe Colombiano' 45,000 hectares of land will be set aside for the production of sugar, in the Bolivar, Cordoba and Sucre region. A daily production of 15,000 tonnes of sugar will be converted into 300,000 liters (79,250 gallons) per day of ethanol that will be used within Colombia and sold internationally.

About 1,500 former Colombian refugees who are undergoing a reintegration process will be employed at the plants, with 4000 indirect jobs expected in sectors related to the activities. The project contemplates the opportunity for the employees to become shareholders of the company, via the 3% share held by USAID, the IMO and the High Council for Integration.

According to the UNHCR, there are around 72,796 Colombian refugees, whereas the Internal Displacement Monitoring Center(IDMC) estimates there to be between 2 and 4 million internally displaced people (IDP) in the country as a result of the ongoing armed conflict (map, click to enlarge).

The High Advisor for Reintegration, Frank Pearl, indicated that the public private contract reflects the commitment that Colombians should have for the reintegration process in the country. La Paz hopes the biofuels project will show that socially responsible economic development will contribute to bringing peace to the Bolivar, Cordoba and Sucre region, through stimulating social stability.

However, notwithstanding the apparently good intentions driving this initiative, it must be said that biofuel projects in Colombia - especially the expansion of palm oil plantations - has played a negative role in the reintegration process. According to the IDMC, some palm oil cultivation projects are blocking the return of IDP's to their lands. This could be seen as an example of what Naomi Klein describes as the 'shock doctrine': after a catastrophy such as a civil war, people's lands, resources and livelihoods are taken over by large capital and the situation is presented as the only viable alternative to overcome the crisis.

This goes to show that biofuel projects can cut both ways: if implemented smartly and within a framework of strong social and environmental policies, with control and power over the decision making process shared with rural communities and civil society organisations, they can contribute to rural development, social integration and poverty alleviation; if they are merely the object of big business interests and controlled by powerful elites, they can lead to land grabs, social injustices and social disintegration:
:: :: :: :: :: :: :: :: :: :: :: :: ::

The new 'pro-integration' project was launched under the auspices of the High Advisor for Reintegration, the ambassador of the United States, William Brownfield, the Attached mission leader of the Organization the International for Migraciones (OIM), Christopher Gascon, the president of the Ethanol Consortium Board S.A., Juan Manuel Hernandez, and the president of Controlsud Internacional Group, Alberto Grosso Camera.

According to Brownfield the project is a classic example of a 'win win' situation, which delivers both social benefits as well as opening markets and addressing energy security in the region. The project ensures Colombia continues to be a key player in the emerging biofuels market in South America.

Colombia's goal is to have 20 operational biofuel plants within 10 years. The country has a tax incentive program and other regulations that require a five percent blend. Beginning in 2010, Colombian diesel will be blended with 10 percent biodiesel. That figure increases to 20 percent in 2012.

: armed conflict and IDPs in Colombia. Credit: IDMC.

Colombia, Presidencia de la Republica: Se firma contrato en el que trabajarán 1.500 personas en proceso de reintegración - December 18, 2007.

Internal Displacement Monitoring Center: Palm oil cultivation for biofuel blocks return of displaced people in Colombia [*.pdf] - November 5, 2007.

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