Eastern Petroleum eyes $30-million loan to finance ethanol project

MANILA, Philippines – Eastern Petroleum Corp. (EPC) is eyeing to raise $30 million through syndicated loans to finance its venture into ethanol processing, a top company official said.

EPC chairman Fernando Martinez said proceeds from the fund-raising exercise will be used to fund its ethanol-related projects.

Martinez said they will also tap into strategic funds should they fail to raise all the money they needed from the loan syndication.

 “We have asked some banks to help us get some syndicated loans or strategic funds,” he said.

EPC is putting up an ethanol processing plant in Isabela province capable of producing 30 million liters a year. The company plans to start its construction next year and finish by 2012.

“We are targeting next year if we can do the groundbreaking. It is a $30-million investment,” he said.

Martinez said they will use cassava as feedstock they will be developing for the plant.

He said they believe cassava will have better yield than any other feedstock, like sugarcane.

“Our model is growing cassava and that’s what we’re doing in Isabela. And just last week because of this project, there is a new board now – the Philippine Cassava Board. It is an organization of all cassava producers, farmers, processors,” he said.

EPC, through its subsidiary Eastern Renewables and Fuels Corp., has engaged in alternative fuels development.

Last year, ERFC has entered into a long- term contract with Guanxi Estates Corp. for the exports of cassava produce as feedstock for ethanol production at Guanxi province.

For every hectare, ERFC can harvest about 40,000 kilos of cassava and produce up to 6,000 liters of ethanol.

Martinez earlier said ERFC is currently focusing on its exports business in China until such time it could start supplying the local market.