D&L mulls 2nd biodiesel plant

MANILA, Philippines — D&L Industries Inc., the country’s leading specialty food ingredients and oleochemicals producer, plans to build a second biodiesel plant to support a further increase in the country’s mandated biodiesel blend.

Through wholly owned subsidiary Chemrez Technologies Inc. (CTI), D&L said it is studying the feasibility of putting up a new biodiesel facility in the country, in line with its continuing efforts to champion the local biodiesel industry.

“D&L is currently in the final stages of evaluating the risks and returns of building a new biodiesel plant, with the decision largely contingent on how well it aligns with the company’s strategic growth objectives and the goal of maximizing long-term shareholder value,” the company said.

D&L said positive regulatory developments coupled with a greater recognition of the economic and environmental benefits of a higher biodiesel blend presents an opportune time to invest and capitalize on the industry’s potential.

A second biodiesel plant will support the government’s plan to further raise the biodiesel blend from three percent (B3) to four percent (B4) by Oct. 1, 2025 and eventually to five percent (B5) by Oct. 1, 2026.

CTI has previously funded many technical research data on the fuel features of biodiesel from both local and foreign laboratories.

The company built Asia’s first continuous coconut biodiesel plant in 2006 and is now the largest biodiesel manufacturer in the country.

Recognizing the significant benefits that an increased biodiesel blend can offer to the economy, environment and consumers, D&L said that it maintains a positive long-term outlook on the local biodiesel sector.

“By developing the industry, several facets of the economy are set to benefit,” D&L said.

“With at least 20 percent of the Philippine population directly or indirectly benefiting from the coconut industry, the potential for economic value creation in the form of additional investments and jobs in both the agriculture and the manufacturing sectors are significant,” it said.

Further, the company said the push toward biodiesel translates into greater use of indigenous fuel, which reduces the country’s dependence on imported fossil fuels and supports energy self-sufficiency.

“With less reliance on imported fuels, the fluctuations in global oil prices would have a lesser impact on the country’s foreign exchange reserves. This stabilization can lead to a more predictable economic environment for currency management,” D&L said.

From a sustainability perspective, D&L said coco-biodiesel offers a meaningful avenue to collectively cut carbon emissions.

Citing a study by the University of the Philippines Los Baños, D&L said coco-biodiesel emits 78 percent less emissions versus petroleum diesel.

An increase in biodiesel blend from B2 to B5 is also estimated to yield an estimated 10 percent mileage increase, which directly translates to consumer savings.

“With the Batangas plant now completed and no other major capital expenditures in the pipeline, D&L has the financial flexibility to potentially undertake the construction of a new biodiesel facility, which would require much smaller capex compared to the amount spent on the Batangas plant,” the company said.

D&L’s P10.5-billion manufacturing facility in Batangas opened in 2023. The Batangas plant allows the company to venture into new global markets and manufacture higher value added products.

“While the company is cognizant of the risks, D&L believes that the essential nature of biodiesel alongside a favorable regulatory environment ensures consistent and growing demand, mitigating risks associated with economic fluctuations,” it said.