Mitr Phol ethanol unit to invest Bt2 bn to double capacity

Mitr Phol Sugar Corporation will invest Bt2.1 billion to double ethanol production capacity to nearly 1.4 million litres per day from 690,000 litres.

The move is in line with the government's policy to terminate the sale of gasoline 91 in October 2012, as well as the company's goal of increasing its proportion or production for export to tap rising demand in the world market.

Ethanol-production unit Petro Green drew up plans to double capacity as soon as the government announced that it would terminate sales of gasoline 91, Mitr Phol president Krisda Monthienvichienchai said last week.

The National Energy Policy Committee (NEPC) recently approved a resolution to terminate the use of gasoline 91 starting next October. Gasohol consumption will increase by 800,000 litres per day to 2 million litres. As a result, ethanol consumption is expected to skyrocket to 19 million to 21 million litres per month.

Krisda said the increased ethanol capacity would serve not only the domestic market, but also exports, as demand in the world market is rising. Brazil, which is the largest exporter of ethanol, is likely to export less. Meanwhile, demand is growing, particularly in Asia. The Philippines, for example, in August implemented a policy to add 10-per-cent ethanol to fuels.

"We [Mitr Phol] want Petro Green to be the leading ethanol exporter in this region. We aim to increase the export proportion from 30 per cent to 50 per cent by next year," Krisda said.

Prawit Prakitsri, managing director of Petro Green, said the company would invest to double capacity at its three wholly owned ethanol plants in Kalasin province, Phukieo in Chaiyaphum province and Dan Chang in Suphan Buri province. Each plant has production capacity of 230,000 litres per day, which will be doubled to 640,000.

He said the capacity expansion would take three years to complete. The first plant is scheduled to complete the expansion late next year. The company is seeking more clients overseas so that it can increase the export proportion to 50 per cent as targeted.

He said the expansion would allow each plant to generate an additional Bt1 billion in revenue per year. In 2010, Petro Green generated revenue of Bt3.5 billion. It expects the number to grow to Bt4 billion this year. Thus, the company should post revenue of at least Bt7 billion by 2012 after all three plants add new capacity.

source: nationmultimedia