NDC to invest in ethanol program

The National Development Co. (NDC), an attached agency of the Department of Trade and Industry (DTI), will invest in the National Fuel Ethanol Program (NFEP).

The NFEP is an energy independence strategy in the Medium-Term Philippine Development Plan (MTPDP).

The NFEP aims to promote the production and commercialization of ethanol, a fuel additive made from sugar cane.

According to Trade and Industry Secretary Juan B. Santos, the MTPDP requires government and private financial institutions to provide credit to cooperatives and individual farmers who participate in the production of sugar cane for ethanol.

NDC General Manager Arthur N. Aguilar said the NDC Board recently approved the investment agreement between NDC and Bronzeoak Philippines, Inc. (BP), NFEP’s main private sector proponent.

Under the agreement, NDC will put up 40 percent of the initial capital structure of San Carlos Bio-Energy Inc., (SCBI) which will be formed to develop and operate a stand alone mill and distillery complex for ethanol, among others, while BP will put up the balance of 60 percent.

BP’s organization, design and structuring of the mill and distillery complex constitute the NFEP’s development phase.

The agreement also stipulates that NDC will put up 30 percent of the equity component of the project’s operation phase.

This phase will be financed through 30- percent equity participation and 70-percent loans.

Apart from NDC, the following entities will put up equity for the project operations: BP, 30 percent; sugar planters Group, 20 percent and other investors, 20 percent.

SCBI will supply fuel ethanol to the transport sector, electricity to the distribution grid, CO2 to the beverage industry and generate Carbon Emission Reduction Certificates for the Senate-ratified Kyoto Protocol Treaty.

The following are its components and corresponding capacity: Cane Milling Plant - cane milling facility with a through-put of 1,500 MT/day cane; Cogen Power Plant - capacity of about 9 MW, of which 4 MW will be sold to the grid; Ethanol Distillery Plant — capacity of 100,000 liters bio-ethanol per day; CO2 Plant - capacity of 17,000 MT alcohol-free CO2 per year.

The plant will be located in a duty free Agro-Industrial Export Processing Zone, in San Carlos, Negros Occidental.