THE Philippine National Oil Company – Alternative Fuels Corporation (PNOC-AFC), a wholly-owned subsidiary of state-owned PNOC, has signed an agreement with South Korean biodiesel producer Eco Solutions Company Limited for the establishment of jatropha curcas plantations and oil mills.
PNOC-AFC president and chief executive officer Peter Anthony A. Abaya explained that the agreement is aimed at establishing a basic framework for collaboration, cooperation and coordination between PNOC-AFC and Eco Solutions thru a memorandum of understanding (MOU).
The agreement calls for both PNOC-AFC and Eco Solutions to pool their capabilities, experiences and resources together in forming a joint venture corporation that will produce crude jatropha oil and establish jatropha plantations at a minimum core area of 100,000 hectares.
"The PNOC-AFC will provide Eco Solutions the necessary assistance for the construction and operation of jatropha oil mills," Abaya noted.
"We will be the one to identify and consolidate a minimum of 100,000 hectares of land for long term use as jatropha plantations and for the construction of oil mills. We will also assist Eco Solutions in ensuring that feedstock supply agreements for the joint venture corporation are in place. The PNOC-AFC will also ensure the supply of Jatropha seedlings for the plantations," he explained.
Meantime, Eco Solutions will establish a corporation in the Philippines and transfer to such corporation its technology and capital necessary to launch its operations in the Philippines. It will provide equity investment through its local subsidiary to finance jatropha and oil mills, and plant a minimum of 100,000 hectares of Jatropha.
The company focuses on environmental engineering, construction and bioenergy. It intends to produce jatropha-related products and create the highest value added to its operations in the Philippines either via supplying organizations in the Philippines or by exporting jatropha products abroad.
In 2006, the Korean government promoted the use of biodiesel by revising guidelines and the mandatory usage and blending of 5% mix of biofuels in diesel. Ecosolutions unveiled investment plans in the Philippines this year to secure steady supply of such feedstocks for biodiesel production.
President Gloria Macapagal Arroyo signed into law Republic Act 936 on January 12, 2007 also known as the Biofuels Act of 2006 – the first of its kind in Southeast Asia. The Act mandates the blending of 1% locally-sourced biodiesel in all diesel products sold by May 2007 and 5% locally-sourced bioethanol blend in all gasoline products in 2009 and a 10% bioethanol by 2011.
