Philippines launches coco biodiesel program under new task force

Hong Kong (Platts)--22Apr2004

The Philippines Wednesday formally launched its coconut methyl ester
initiative under the supervision of the newly created National Clean Diesel
Task Force as part of the government's effort to boost use of the environment
friendly fuel and lower its expensive oil imports bill. The task force was set
up to oversee the implementation of the program, which aims to promote the
product first to government-run organizations and then to the public, a
Department of Energy official said Thursday. The DOE earlier this month shelved
its plan requiring oil companies to market the environment-friendly coconut
methyl ester-diesel blend at their retail outlets due to opposition from the
firms. Oil firms rejected marketing the fuel blend saying it had not undergone
sufficient testing for quality, and due to the high price of CME. A 1% blend
of coco-methyl ester for every liter of diesel will result in an additional
minimum cost of Peso 0.50/l ($0.008/l) over diesel's current retail price of
around Peso 18/l, according to the DOE.

Meanwhile, UK-based D1 Oils Ltd will assist the Philippine Coconut Authority
in the coconut methyl ester production process. Under the agreement, the
government will have access to D1 Oils' biodiesel technology. Coconut methyl
ester or CME is derived from trans-esterification of coconut oil in the
presence of methanol and caustic soda. The UK firm will also offer government
staff training on the production of CME. The initiative is expected to take up
to three years, and would need funding to the tune of Peso 110-mil ($1.9-mil).
The government has however yet to work out where these funds would come from,
the DOE official added. Under Manila's Clean Air Act, effective 2003, oil
firms cut the maximum aromatics content in gasoline to 35% from 45%, while
lowering benzene to 2% from 4% by volume. The sulfur content of fuel oil has
also been cut to 0.8-1.0% from 3%, while diesel's sulfur content was lowered
to 0.05% from 0.2% in November 2003.

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