State-run oil giant Petrobras (PETR4.SA)(PBR.N) and General Electric Co (GE.N), which helped design the plant, are betting that increased use of ethanol generation by green-conscious countries will boost demand for the product.

Brazil, the top global ethanol exporter, is already in talks with Japan to develop biofuels power generation there.

“We have great expectations to show the viability and economy of generating electricity from … an alternative feedstock to fossil fuels,” Maria das Gracas Foster, head of Petrobras’ natural gas division, said.

Petrobras with the help of GE upgraded the 87-megawatt power plant to switch between running on natural gas or ethanol instantaneously. Brazil primarily relies on hydroelectric power but needs backup thermoelectric generation during the dry season.

John Ingham, Latin America Products Director for GE, said tests showed switching the plant to ethanol reduced carbon dioxide emissions without lowering energy output.

GE has around 770 turbines like those used in the Juiz de Fora plant, including many in Japan, that could be converted to run on ethanol, he said.

“A plant like that consumes a lot of ethanol, so it has to be in a place that makes sense (such as) places that have no access to gas, like Japan, some islands, or places that depend heavily on diesel like the Amazon region,” he said.

Brazil is expected to produce a record 27.8 billion liters of ethanol in the 2009/2010 season. It began its biofuels program 30 years ago and now mandates a minimum 20 percent of ethanol in gasoline.

Petrobras itself is only starting to enter the ethanol market. Brazil’s ethanol production comes from sugar cane milled by companies such as Cosan (CZZ.N) or commodities giants including Cargill Inc [CARG.UL], Bunge (BG.N) and ADM Co (ADM.N).

Domestic demand for ethanol is being driven by the popularity of the flex-fuel car technology that was launched in 2003 and now makes up around 90 percent of new vehicle sales. (Writing by Brian Ellsworth; Editing by Marguerita Choy).

By Denise Luna

Source: Reuters

Progress in the use of biofuels for power generation..

On May 20 the government announced the GENREÂ program (Renewable Generation), by which the state company ENARSA will call for tender the purchase of electricity produced through renewable energy.

The ceremony held at Government House in the presence of the President of the Nation-Cristina F. Kirchner, the Secretary of Energy Daniel Cameron, the Secretary General of the Presidency, Oscar Parrilli, the Governors of San Juan, Santiago del Estero, La Rioja, other officials and businessmen linked to the industry.

This program sets the purchase of 1000MW of electric power (which will be tendered) produced on the basis of various renewable energies, from this total: 500MW will be generated from wind power, 120 MW from waste, 100MW from biomass, 30MW from geothermal; 60 MW from small hydro electrics, 20 MW from solar, 20 MW from biogas and 150MW that will be generated based on biofuels (mainly biodiesel).

The president of CARBIO, Ing Fernando Pelaez, said, “The incorporation of renewable energies in the national matrix contribute to its diversification into non-fossil fuel dependence, as well as reduces the emission of greenhouse gas which results in an environmental benefit. ” He concluded that this measure will have a positive impact in the biofuels sector as it involves both a reactivation in the production of biodiesel, and the imminent need to resort to alternative sources of energy generation.

CARBIO is a nonprofit civil association whose main objective is the development and promotion of production and marketing of biofuels and its industry, to contribute actively to a sustainable and economic growth of the country. Is formed by companies of recognized prestige in Argentina that produce over 95% of biofuels in our country.

Courtesy Carbio for Nextfuel Argentina / www.biodiesel.com.ar

Developer. De Souza Meirelles is leading a project for expansion of ethanol.

Interview with brazilian producer Joao Carlos de Souza Meirelles.

His company, Frontera Norte, is working on the development of new agricultural zones, founded three cities and colonized one million hectares, mostly in Mato Grosso. Strong commitment to energy sugar cane.

Frontera Norte Ingeniería de Desarrollo Limitada is a company with over 30 years in the development of large zones of new agricultural frontiers of Brazil. “We did what we call in Portuguese, colonization.” said to “La Voz del Campo” the engineer Joao Carlos de Souza Meirelles, group member and former secretary of agriculture of the state of San Pablo. Coming from a family of Portuguese immigrants but with several generations among Brazilian farmers, De Souza Meirelles is one of the “fathers” of the raise of Brazil as the first world exporter of beef.

He also participated in Cordoba as a speaker in the first Argentine-Brazilian Corporate Bioenergy Summit.

He explained that the ventures of Frontera Norte opened opportunities for farmers in southern Brazil with large families who sought new lands for themselves and their children. “To give an example, we have developed rural activities in the state of Mato Grosso in more than one million hectares. These were virgin lands, we did projects, soil´s studies, nature conservation and build cities. I have built three cities on this new frontier, ” De Souza boastful.

- What economic units are we talking about?

Near the cities are small plots for vegetables, fruit farmers who supply urban areas, ranging from one to five hectares. Then, properties that can range from 120 to 250 acres, and ranging from 250 to 2500 or 5000 acres. And more distant from these towns, properties can have 25 thousand acres.

- And in the field of bioenergy, which projects has the company?

In the past two years we have developed a very important project for forming a cluster of bioenergy, it is not a factory or an industry, but a set of three large projects. Each one will plant 60 thousand hectares of sugar cane, a total of 180 thousand hectares. The are about 80 kilometers from one another so the total production reaches one billion liters of ethanol per year, and also electricity will be produced. The industrial part is final study, the construction will be contracted in 2010 and the first unit will start producing in 2012, the second in 2014 and third in 2016.

There is a concern about relative prices, with oil at $ 57 a barrel and soybeans to more than $ 400 a tonne in Chicago. How does this affect the business of biofuels?

-First, the relative prices of oil impacting the entire side of farming inputs (fertilizers and defense derivates). Secondly, for us to produce ethanol and electricity in Brazil, if oil is above the $ 40 we are absolutely competitive with ethanol. And all the experts in the world are convinced that the level of oil prices will stabilize in the coming years around the $ 60. And we are looking increasingly competitive, in five to 10 years we can be competitive with oil $35 or $ 37 a barrel.

In Argentina, and in Córdoba there is great expertise in producing agricultural commodities.

 What do you recommended to guide investment in agro-bio?

-It would be much pretension to make recommendations, but I would allow myself a reflection: what are the problems that farmers, were they from Argentina, Brazil or anywhere, have experienced in the past. 50 years ago we were not the most important thing in our economy because our countries lived of our productions of wheat, corn, meat, coffee. What happened? The generations that came imagined that only the industry was the national salvation and peasants, were considered the second in importance. The great revolution is changing the notion that we are not producers of raw materials but a very important part of the production chain. And if we do not organize the production chain, we are always going to be the absorbers of international prices. The other always win, and we, the producers, are compressed in terms of prices. But if we participate in the organization of the productive chain, of the concepts of price formation and increased productivity, we will be the most important in the chain.

Carlos Petroli

Source: La Voz/ Córdoba / Argentina

Following the publication of the EPA’s draft Regulatory Impact Analysis this week which includes proposed changes to the Renewable Fuels Standards Program, the Argentine Renewable Energies Chamber expressed both concerns and optimism regarding the possible effects this will have on the export-driven Argentine biodiesel industry.

Buenos Aires, May 8, 2009 – A recent study published by the Environmental Protection Agency of the United Status (EPA) is promoting biofuels that reduce greenhouse gas (GHG) emissions by no less than 50% when compared to their fossil fuel counterparts. This same report classifies different categories of biofuels and concludes that soy-based biodiesel reduces GHG emissions by only 22%. If approved, the EPA’s proposal could cause grave harm to Argentine biodiesel producers, since more than 95% of Argentina’s biodiesel is made from soy oil. Additionally, the industry is export-driven and the United States is Argentina’s second largest export market after the European Union.

“The EPA’s analysis has the potential to drastically reduce Argentine biodiesel exports to the United States. It makes decisions regarding land use change for countries other than the U.S., yet doesn’t appear to take into consideration the positive effects of Argentina’s No-Till farming methods which plays a role in ensuring that Argentine soy biodiesel meets and exceeds the newly proposed stringent U.S. standards,” said Carlos St. James, president of the Chamber.

“While we fully understand and appreciate each nation’s right to establish standards and goals
for products consumed in their country, facts need to correct. We know that Argentine soybased
biodiesel is among the cleanest and environmentally-friendly options. This has been evidenced in scientific studies developed in the U.S. itself some years ago and more recently by our country’s National Institute of Agronomy Technology (INTA, by its initials in Spanish), both of which show reductions in GHG emissions that exceed 70%.”

The EPA has proposed a 60-day window in which the various industry actors can better understand the assumptions in the study and to offer counterproposals and corrections to this data. “Argentina has sound scientific elements to defend its position. We need to work internally with all industry interests along with relevant government agencies to present a common voice to ensure we are heard properly,” affirmed Lucas Trotz, the Chamber’s Manager. The Chamber is requesting a 40-day extension to the initial window, and various Chamber members will travel to Washington to participate in the July 9-11 workshop being organized by the EPA to discuss the draft.

The Chamber will also seek this extension as member of the Global Renewable Fuels Alliance, a global association whose members represent 65% of world biofuels production. Bliss Baker, Executive Director of GRFA from its headquarters in Toronto added, “Argentina, as one of the world’s largest biodiesel producers and exporters, will undoubtedly play a key role in ensuring that the industry continues to grow sustainably and we will work with them to present our organization’s point of view regarding the EPA study.”

St. James concludes, “We are confident that at the end of the day common sense, a frank and open dialogue, and the facts will carry the day. If not, the ideals of fair and open trade as espoused by the U.S. will take a step backward in the ongoing task of creating global markets.”

Kyung Wook Hur, Vice Minister, Ministry of Strategy and Finance of Korea; and Luis Alberto Moreno, President, IDB, signed a memorandum of understanding to promote programs and projects that foster cooperation between them and, in particular, activities related to green growth, sustainable energy and climate change.

Photo: Árlette Pedraglio

The Export-Import Bank of Korea and the Inter-American Development Bank (IDB) will sign a an agreement to co-finance public and private sector projects worth as much as $2 billion in the next three years in Latin America and the Caribbean.

Kexim, as the Korean official export credit agency is known, and the IDB will work together to share information and identify and finance projects in infrastructure, information technology, trade finance and other areas. The accord will be signed in Medellín, Colombia, during the 50th Annual Meeting of the IDB’s Board of Governors.

Also during the annual meeting, the IDB and the Korean government, one of the Bank’s 48 member-countries, will also sign a cooperation agreement on Green Growth to develop and promote the use of renewable energy, efficient energy technologies and practices and carbon finance activities in Latin America and the Caribbean.

“We are honored by the presence in Medellín of Vice Minister Kyung Wook Hur and Kexim’s President Dong-soo Kim, whom on behalf of the Korean Government are making a special contribution to more sustainable economic growth in Latin America and the Caribbean by providing cutting-edge green technologies,”said IDB President Luis Alberto Moreno. “Kexim’s remarkable support with this large credit facility will allow the IDB to enhance its infrastructure financing during these difficult economic times”.

The accord also involves the creation of Green Growth Operations Steering Committee, formed by IDB officials, the Ministry of Strategy and Finance of Korea and members of Kexim. The committee will help in the formulation of policies that promote economic growth with environmental sustainability inn the region.

The IDB, the world’s largest regional development institution, and the Korean government are also strengthening its relations and partnering to provide advisory services in the areas of environmental protection, energy efficiency and sustainable finance.

Korea joined the IDB in 2005 as the Bank´s 47th member. The Asian nation has financed several IDB initiatives since then, including poverty alleviation programs and the development of small- and medium-sized enterprises in Latin America and the Caribbean.

The IDB, through its Office of Outreach and Partnerships (ORP) has facilitated the accomplishment of these partnerships that will provide additional financial and non-financial resources to its member countries and is now effectively becoming the platform for doing business in the region.

Source: BID

The jatropha (known as Barbados nut) and the biodiesel attract the interest of the markets of Asia and North America, through the promotion that two investigators carry out in United States on the plant and its yield.  Â

In October of 2008, a group of investigators visited the country interested in promoting the scientific investigation in the alternative energy field. Ryan Joon Hyeong Im and Ryan Choi wants to bring the scientific investigation on the jatropha and the biodiesel production to the country, at the same time of promoting Paraguay in the Asian and North American markets, explained Jerónimo Finestra, representative of the Association for scientific development of the Mercosur. Â

“It is to transform the country into a country of biodiesel production and another type of renewable energy. Through this association, they are promoting Paraguay among investors and in the universities of United States, to bring investigating teams”, Finestra commented.Â

In July of this year, Im will arrive to the country to continue with his scientific investigation on the jatropha. The novelty will be that he will carry out laboratory studies and will investigate on how to improve the yield per hectare of the plant.Â

Mr. Ryan Choi lived in Paraguay some time ago and today works, together with Im, in an investment fund in United States. This is how they began to investigate on the plant and discovered that in Paraguay the land is capable for the production.Â

The investigators want Paraguay to be, for the first time, energy salesperson, besides the electric one. For that, bonds are being settled with local authorities and foreign investigators, according to the representative of the association in the country.Â

“Mr. Im is the scientific brain of the project, while Mr. Ryan Choi is the economic boss of it”, Finestra specified.Â

Im and Choi are working in the investments acquisition for plantations of the Barbados nut, as well as for the installation of a factory to process it. For the factory and the plantations that can supply it is said that at first they will require of about 5 million dollars. For the investigation it could start with 100 thousand to 200 thousand dollars.Â

“The project is jatropha and its production in the Paraguay” it is the name of this enterprise. Another of the projects is, once consolidated in Paraguay, to launch the project to the Mercosur, but having the country as operation headquarters.Â

They chose the country because they consider that it has ideal lazy lands for this cultivation, there is enough manpower, and the lands are economically accessible, among other reasons.Â

Source: Ultima Hora

It would begin with the super and common types due to the lack of the capacity to process alcohol.Â

The 5% bioethanol mix in the naphtha won’t reach to all the varieties in January of 2010 as it was foreseen, but rather it will begin with the super and ultra types due to the lack of dehydrating plants to transform the alcohol. As confirmed to La Nacion by sugar companies involved in the business and the Argentinean Sugar Center that pointed out that May 15 will conquer the term to present the projects for the bioethanol quota before the Secretary of Energy. Fernando Nebbia, president of the Argentinean Sugar Center, said: “For January there will be an important quantity of dehydrated alcohol to begin the operative with two types of naphtha: common and ultra. Â

Starting from the second semester, when other plants enter in regime, the super naphtha will be included.”Â

“We are speaking of this and negotiating with the Secretary of Energy and the oil companies. Everything is clear and spoken”, he affirmed. From an important sugar industry, they also pointed out the segmentation by naphtha type as the most immediate alternative. LA NACION consulted the Energy portfolio, but had no answer at all.Â

The plant that will cause a pothole in the production and won’t be operative the first days of 2010, will be the one projected by Atanor, Refinor and other sugar factories of Tucumán that will have a annual production capacity superior to 130.000 cubic meters. Jorge Domínguez, industrial director of Atanor, explained: “The construction of this type of projects demands a year and half and didn’t still begin because there are some numbers yet to be defined. It will be ready to start towards the end of 2010, not at the beginning of January.”Â

“The sugar industry is the natural bioethanol supplier and Tucuman is the biggest producer. Then, I don’t believe that the 270.000 m3 or 270 million liters that are considered to achieve the 5% mix will be met. The Secretary of Energy can defer the implementation of the law, it can define imports or, even, delimit the application”, he said.. In the same line, sources of Ledesma highlighted: “An interesting volume will be achieved with the foreseen plants, but without that of Atanor the 5 percent that was foreseen won’t be met.”Â

Projects and capacitiesÂ

The dehydrating plants of the big players that will be ready to satisfy to the oil companies will be those of Ledesma, Tabacal and The Florida, as they pointed out both of the first ones.Â
From Tabacal, they specified that the company would make off with 10 percent of the quota. In that line, they detailed that “the company began before with the investment and the construction. The plant will have capacity to process 45 million liters per year, and our quota would be of 27 millions”. on the other hand, in Ledesma, that is “working strongly to reach January with the plant”, they explained that it will produce in 2010 around 55 million liters of alcohol to destine to the internal hydrating market and to the new market of fuel alcohol. “The dehydrator will have the same capacity and the idea is to buy alcohols to other sugar factories”, they added.Â

Mercedes García BarteltÂ

Source: La Nación

WASHINGTON, (Reuters). – The future of the biodiesel market is in unstable land, because the closing of the legal lagoon of a fiscal credit and new European import tariffs could reduce the trade, said the Energy Information Administration. Â

It is expected that in 2009 in United States and with the standards of the renewable fuel, 500 million gallons (1900 million liters) of biodiesel be blended with diesel, a biofuel elaborated starting from oils or of animal fats. Â

The figure should be increased by law to 1000 million biodiesel gallons for 2012. This, together with the rise of the fuel prices, generated an increase in the production in the last years, and the tributary incentives sent great part of the fuel to the foreigner, in accordance with the EIA.Â

“However, the perspectives for this year of the biodiesel market of United States continues being highly uncertain”, said the agency in their weekly revision of the petroleum market. The tax credit of 1 dollar per gallon for the biodiesel blended with petroleum diesel, known as the Blender Tax Credit (BTC), was extended until year end. But a legal lagoon in it that stimulated the trade was covered in October as part of the economic stabilization law of 2008.Â

The legal lagoon would allow the operators to add a small quantity of petroleum diesel to the imports of pure biodiesel and then to export the new mixture to take advantage of the fiscal credit.Â

“To add only 1 gallon of conventional diesel to 1000 gallons of biodiesel was enough as to qualify for the BTC”, specified the report of the EIA. While the legal lagoon existed, the biodiesel imports grew from 4 million gallons in 2004 up to 315 millions last year, as it was considered.Â

Source: La Nación

It will add industrial park in Terminal Las Palmas.Â

Terminal Las Palmas will invest u$s 10 M to enlarge its port complex of Zárate enabling the dispatch of liquid loads and a new general loads dock, that will be added to the grain and container portrising that today they already have. And also, in a 5 year term, they hope to lift an industrial park to attract the establishing of companies linked to the agri exporting business. Â

As it was announced yesterday by Federico Pellicer, manager of Terminal Puerto Feeder, of Terminal Las Palmas, a company of the Molinos Cañuelas Group, in the framework of the III Argentinean Encounter of Fluvial Transport that was carried out in the Board of Trade. Â

Right now, and in an 87 hectares property, Terminal Las Palmas has a grain dispatching port with capacity of 2.5 million tons/year and a port for feeders (containers) with capacity of operating 25 thousand a year.Â

“Due to the current economic situation, the grain port operates 1 million tons and we are moving 12 thousand containers a year”, the executive clarified.Â

Why the amplification?, asked punto biz.Â

The reasons are several. They are on-line with the objective of the group of growing integrating their business knowing the savings that it generates to be in all the tips. We saw it when we had an own port to dispatch grains. We already have the liquid load that we plan to dispatch and we are taking it out through other ports. And we are very aware that we need to take it out through ours, saving costs as for example of docking rights. Also, due to the crisis the investment costs have lowered, for example in the price of the steel to build the dock. Another example, a crane that we have just bought costs us u$s 900.000 less than the price that it had one year ago.Â

Pellicer said that the first step will be to enlarge for the liquid discharge to the grain port that they hope to have ready towards ends of this year and estimated that the investment will be around the u$s 6M.Â

“It is a quick work, mainly because we already have the pipes, and it can demand us 4 months of work”, the manager said. The port will have a storage capacity of 25.000 m3 for vegetable oils and fuels. As he said, he already has the executive project ready and the bid will be released in a very short term. The idea is to concentrate the dispatching of own load.Â

Then, the terminal plans to add a bulk loading dock of 200 meters. “We even already have the crane that we will use in that dock operating”, he got excited. In this case, the dock is thought to alternate the own load (bags of flours, for example) with loads of others. “This investment will cost some u$s 4M, but if we did it before the crisis we would have to add u$s 1M of costs to it”, he explained.Â
“For all these the works, the group has the financing of a German bank that didn’t stop due to the global financial crisis”, Pellicer highlighted.Â

New industrial park appearsÂ

Finally, the project of Terminal Las Pampas includes the formation of an own industrial and logistical park to move their industry beside the port, with the advantage of having the production beside the dock and avoiding the transporting costs .

“For next five years we want to have big advances and in five years more it to be a reality. It is a very ambitious industrial park, of many millions of dollars, work framed in a plan of important expansion”, he added.Â

The Cañuelas Group is a strong food producer: flours, cookies, oils, breadcrumbs and pastas. The idea is to move many of these factories to the new multipurpose port. But they will also tempt other companies out of the group that are interested in occupying a place in the new industrial park.Â

Courtesy of Punto Biz for Nextfuel Argentina/Biodiesel.com.ar