PetroChina aims for 600 Mgy in ethanol capacity; announces $109 million investment in ethanol plant in Sichaun province

PetroChina announced that it will invest $109 million in a 33 Mgy non-grain ethanol plant in Nanchong, Sichuan.

PetroChina said that its ultimate aim is to construct 600 Mgy in non-grain ethanol capacity and 52 Mgy of wood-based biodiesel capacity from China’s forest resources.

The Ministry of Finance recently announced policies to promote the production of biofuels from non-food feedstocks. The subsidies will be flexible, and tied to the price of crude oil. Farmers will receive up to $878 per acre planted with forest products for biofuels, and up to $791 per acre for crops planted for biofuels.

China has recently announced abandonment of ethanol projects that use foodstocks, excepting existing plants and those already under construction. China is the third-largest ethanol producer, behind Brazil and the US.

In China, the Ministry of Agriculture is reviewing the land allocations for biofuels crops, with clear indications that food would be given priority over fuel. COFCO, operator of a 200,000 ton ethanol plant in Guangxi, is seeking feedstocks from Vietnam and Thailand. But biodiesel producers, who depend largely on non-food crops, expect to be largely spared from curbs on production.

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