Toyo Eng’g plans multi-billion peso biodiesel project in RP

Japanese firm Toyo Engineering Corp.’s (TEC) plans to put up an integrated coco methyl-ester (CME) manufacturing plant in Region I faces delay as the company has yet to raise funds for a feasibility study.

Officials of the Philippine Coconut Authority (PCA), said TEC is scouting for joint venture partners. It also plans to tap lenders to fund a feasiblity study on a CME plant with nucleus coconut plantations to ensure the supply of raw materials. TEC also wants to tap the Japan Bank for International Cooperation, they added.

TEC is principally involved in plant engineering services for the petroleum, natural gas, fossil fuel power, petrochemical, oil refinery plants and energy-related industries.

PCA deputy administrator Carlos B. Carpio said earlier that TEC’s grand plan is to establish an integrated CME facility, the entire output of which will be shipped to Japan to supply its growing demand for bio-fuels, both for fuel-dependent industries and manufacturing concerns, and also for its automotive industry which is now coming up with hybrid vehicles to reduce its dependence on soaring crude prices.

Japan is one of four Asian countries planning to mandate the blending of CME with petro diesel to cut their dependence on expensive oil. With its 40-billion liter diesel requirement, Japan is planning for a CME blend of five percent.

Besides its proven efficiency as a petro-diesel additive, CME use is expected to result in a mileage increase of 10 percent without any need to alter vehicle engines.

Carpio said TEC is initially planning to establish 600,000 hectares of coconut lands, possibly in new areas in Region I such as Pangasinan, Ilocos Sur, Ilocos Norte and La Union. An alternative is to utilize the wide coastal areas of these provinces. The CME plant will have to be in La Union, which has an international port.

Opening up new areas for coconut farms would mean an investment of about P1 million per hectare, while using coastal areas will require only P100,000 per hectare. This would require anywhere from P60 billion to P600 billion.

"It’s going to be a very expensive investment, but TEC is forward-looking, they are looking at supplying the CME requirements of Japan in the next 10 years and beyond," added Carpio.

The PCA has been advocating for the wide use of CME as substitute for expensive crude oil.

Currently, there is only one Filipino company that manufactures CME. Chemrez Inc. last year opened a biodiesel plant capable of producing 60 million liters of biodiesel per year, thus bringing up the country’s biodiesel production to 115 million liters, the biggest one in Asia. It’s Chemrez’s second facility since they started producing biodiesel in the 80s and selling their output to Australia, Japan, and Europe.

With this volume, Chemrez supplies just one percent of the country’s biodiesel requirement. The PCA however, pointed out the economic benefits of shifting to biodiesel.

Calculations show that a one-percent biodiesel blend could increase mileage from 10 to 30 percent. That could translate to at least a nine-percent reduction in fuel consumption or more than half a million liters of imported diesel each year. This translates to P17-billion annual savings in the country’s import bill.