The Philippines' Roxhol Bioenergy is aiming to start commercial operations at its 100,000 liter/day ethanol plant in Negros Occidental province in August, delayed from its earlier target date of July 1, a company source said Thursday.
Roxhol's plant, which uses molasses as a feedstock, started trial runs in late 2010 and early this year, and is now in the second stage of testing, the source said.
This will be followed by another round of evaluation and should there be other issues with the equipment or weather, operations could be delayed further to late August or early September, the source added.
The plant ran at 80% rates during trial production, confirming that its 100,000 liters/day capacity is achievable.
Talks have been held with several companies over the sale of ethanol from the plant, the source said, but thus far Roxhol has not concluded any long-term and exclusive agreements.
In addition, Roxhol has received offers for tolling agreements from various market participants but the company says it has not taken up any of these given that molasses are in plentiful supply in the Philippines and current prices are relatively low.
The tolling agreements stipulate that oil companies will procure and provide domestic producers with the required feedstock, pay the producers a processing fee and offtake all the ethanol production.
Demand for ethanol is set to rise in the Philippines, when the partial implementation of its E10 mandate starts in August. Full implementation of the the E10 mandate, which requires 10% of the total volume of gasoline sold in the country to be ethanol-blended gasoline, will begin on February 6, 2012.
Based on the Philippines' current gasoline consumption, the country will require around 400 million liters/year of ethanol to meet the E10 mandate.
In the light of the impending enforcement of the E10 mandate, the company source maintains that it will focus on the anhydrous market but it will also not rule out producing hydrous product -- food and beverage grade ethanol -- depending on economics.
