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South Africa: Sugar group has 200m litre bioethanol vision

Agricultural group Tongaat-Hulett believes that it has the potential to contribute 200-million litres of biofuel within Southern Africa, as South Africa eyes the production of 1,2-billion litres of fuel-grade ethanol a year, the company disclosed on Monday July 31, 2006.
“Bioethanol is not going to disappear,” Tongaat-Hulett CEO Peter Staude enthused at the company's announcement of its half-year results.

He pointed out that the company had the potential at its Triangle operations, in Zimbabwe, to produce 40-million litres of biofuel a year, some 60% more than its current production rate of 25-million litres a year.

In addition, Tongaat-Hulett had plans to include a 17,6-million-litres-a-year ethanol plant at its Xinavane plant, in Mozambique, where it was planning a R895-million second-phase expansion of its sugar and biofuel facilities.

It was also considering bioethanol in South Africa and Swaziland, and was also looking at biofuel spinoffs from its nonsugar agricultural businesses, which fell under African Products.

Bioethanol is an octane-enhancing petrol/diesel additive that is produced from crops, including maize, sugar cane and cassava.

There are global initiatives to tap fuel from agricultural commodities, given crude oil supply concerns, as well as rising oil prices.

The world's top maize producer, the US, which exports some 20% of its output, was aggressively pursuing biofuel options.

Its exports were expected to drop to 10% over the next few years as a result of its drive to source nonoil-based alternatives, and the volume of US maize used to produce ethanol was likely to exceed export volumes in 2007. Stuade said that US ethanol output was expected to more than double from the 3,5-billion gallons in 2005, to 7,5-billion gallons by 2012.

Discussing South Africa's drive to increase the use of renewable energy, Staude said that government was targeting 10 000 GWh of local power supply to be generated from renewable resources by 2013, which is equivalent to 1 870 MW.

The Department of Minerals and Energy pegged local electricity demand to be 42 000 MW by 2013.

Tongaat-Hulett currently supplied 9 MW into the South African national electricity grid, although Staude said that it had the potential to supply up to 120 MW of renewable energy.

Another South African biofuels company, Ethanol Africa, began with the construction of its first ethanol plant in July, and was due to erect at least another eight, over the next six years.

Additional information:
News date: 31/07/2006

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