Mission Biofuels signs massive 25 Mgy biodiesel supply contract

In Australia, Mission Biofuels has signed a one-year contract with an undisclosed global oil trading firm to supply up to 25 Mgy of biodiesel, while work on an additional 38 Mgy biodiesel refinery in Malaysia, the firm’s second, is reported to be on schedule for completion.

Mission Biofuels said it will commence production at its Kuantun plant to fulfill European orders. Mission recently announced that it would cease producing biodiesel at-risk and would produce as a jobber to specific orders. The 28 Mgy palm oil biodiesel plant will commence deliveries in June. Mission has contracted to produce more than 200 million gallons of biodiesel through 2013 to European traders.

The company will establish a second plant to meet those needs, and will utilize jatropha oil from 2009 in its production. Mission expects to contract for jatropha from 2.5 million acres of production land by 2010.

Earlier this month, Mission Biofuels said that it would only produce biodiesel in the near future on a “jobber” basis, citing the high price of feedstocks. The company said that it was in the process of converting from palm-oil based biodiesel production to jatropha, and added that it expected to produce 1.1 million gallons of biodiesel this month, while increasing production of glycerine.

In India, Mission Biofuels signed an exclusive jatropha oil acquisition deal. Under the agreement, a cooperative group in an undisclosed district will provide jatropha from 37,500 acres on an exclusive basis to Mission Biofuels.

The company will provide nurseries, technical expertise and a local processing center., The district will plant additional jatropha acreage over the multi-year exclusive partnership.

Mission has been in the news of late seeking alternative sources, and also for a biofuels contract with an unnamed major oil producer that failed to close. Jatropha production has been ramping up strongly in India, and the deal by Mission is with an entire district of production. In September, Mission Biofuels signed a three-year deal for exclusive rights to jatropha oil produced from 12,500 acres in India.

In other Mission news, HSBC recently provided funding for a $59 million Mission Biofuels biodiesel project in Malaysia that will include two plants in Malaysia. The company said $9.55 million would be used to complete the first plant, and $27 million would be used to build the second plant. The company did not offer details on the usage of the remaining $23 million. The first biodiesel plant, in Kuantan, Pahang, Malaysia, will produce up to 18 Mgy per year of palm-oil biodiesel which will be exported to Germany under a five-year contract.

The company has indicated that it intends to convert from palm oil to jatropha oil.

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