Delay in commercial operation of San Carlos ethanol plant expected

Due to a possible delay in the commercial operation of San Carlos ethanol plant, Petron Corp. is likely to source its ethanol requirement from abroad, a top company official said.

Petron chairman Nicasio Alcantara said there may be some delay in the construction of the San Carlos plant which is contracted by the oil firm for its ethanol supply.

“We may have to import our requirement for ethanol blend of five percent for 2009 from Brazil, India and Thailand. Just to comply with the law, we have to import. These three possible sources, offer cheaper prices of ethanol,” Alcantara said.

The importation of the ethanol requirement, he said, is still being studied.”We have to determine our next big step on ethanol blend.”

According to Alcantara, they have already made a trial importation. “We have received a tender for two containers for trial importation.”

The San Carlos plant is expected to serve the ethanol requirements of Petron Corp. The plant, a project of British firm Bronze Oak, will supply 100,000 liters of ethanol, can also generate 9MW of electricity and another 5 mw for export to the grid.

Ethanol, also known as ethyl alcohol or grain alcohol is a type of alternative fuel being groomed to substitute traditional, oil-based fuels like gasoline and diesel.

Earlier, Petron has estimated that it would allot  some P260-million budget for ethanol compliance under the Biofuels Act.

Petron has already tied up with San Carlos Bioenergy, which is supposed to come on stream by early 2009, for its supply of ethanol to be blended on its gasoline products.

The Biofuels law mandates a nationwide minimum one-percent biodiesel blend in all diesel-fed engines within three months upon effectivity of the Act.

It also mandates at least five percent bioethanol blend within two years upon effectivity of the Act. The percentage blends would be increased to two percent for biodiesel and 10 percent for bioethanol within two years and four years, respectively upon the effectivity of the Act.

Early last year, President Arroyo signed into law Republic Act  9367, also known as the “Biofuels Act of 2006,” that promotes the use of alternative transport fuels.

The Biofuels Act of 2006 seeks to reduce the country’s dependence on imported fuels with due regard to the protection of public health, the environment and natural ecosystems consistent with the country’s sustainable economic growth that would expand opportunities for livelihood.

The Act mandates the use of biofuels as a measure to develop and utilize indigenous renewable and sustainably-sourced clean energy sources to reduce dependence on imported oil.