Chinese Oil Giants Move to Biofuels

Manufacturing News, Source : The Manufacturer US
Zone : Energy business
Published : 16 Apr 2007 13:38

, CHINA--April 16, 2007--Researched by Industrial Info Resources (Sugar Land, Texas). China National Offshore Oil Corporation - CNOOC Limited (NYSE:CEO) (Hong Kong) announced recently that a biodiesel plant with an annual output of 60,000 tons will be built within the year in Dongfang City, Hainan Province. Plans also include planting 100,000 mu (about 25.7 square miles) of jatropha curcas (a tree whose seeds and nuts can be processed to produce biofuel) in Hainan to provide raw material for the biodiesel plant in the future.

BEIJINGSince growing jatropha curcas is a long process, usually taking three years to produce fruit and five years to harvest, raw materials for the facility will initially be imported from abroad.

The construction of the Hainan biomass refining base is just one of the projects by CNOOC in its movement toward the biomass fuel sector. In addition to its deployment in China, CNOOC also launched a plan in Indonesia. Oil giants with the same financial strength as CNOOC, China Petroleum and Chemical Corporation, also known as Sinopec (NYSE:SHI ) and China National Petroleum Corporation (CNPC) have ambitious strategic deployment plans too.

atropha curcas is mainly distributed in the Sichuan, Guizhou, Yunnan and Hainan provinces. The oil content of its seeds/nuts could be as high as 40%-60% and can be used to produce biodiesel with a better performance than commercial diesel in flash point, condensing point, sulfur content, CO2 emission and particle size.

In July 2006, Sinopec decided to build a biodiesel production plant with an annual output of 100,000 tons in Panzhihua, Sichuan Province, together with an auxiliary energy forest base of 400,000-500,000 mu (up to 128 square miles). Not long after, CNOOC signed an agreement with Panzhihua’s Municipal Government for the Jatropha Curcas Biodiesel Industry Development Project in the West Panzhihua area on September 12, 2006. The total investment is as high as $ 300 million. It is expected that CNOOC will have 500,000 mu of jatropha curcas plantation base with annual output of 100,000 tons of biodiesel in Panzhihua by 2010.

In January 2007, CNPC signed a total cooperative framework agreement on the development of biomass energy with China National Forest Bureau. Starting in 2007, both parties will launch one jatropha curcas demonstrating base with a scale not less than the raw material supply needed for an annual biodiesel output of 20,000-30,000 tons in Yunnan and Sichun respectively. The scale of CNPC’s plantation base in Yunnan might reach 400,000 mu this year. CNPC will actively participate in the development of biomass energy, said Jiang Jimin, President of CNPC. Its annual production capacity of non-grain ethanol will exceed 2 million tons, with an annual 200,000 tons of biodiesel from forests in a commercialized scale together with more than 400,000 hectares of a raw material biomass energy base by the end of 2011.

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