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Monday, Mar 11, 2002

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Alfa Laval hopes to gain from ethanol in petrol

Our Bureau

NEW DELHI, March 10

ALFA LAVAL (India) Limited hopes to benefit significantly from the Government's decision to allow 5 per cent doping of petrol with anhydrous alcohol.

"We expect to sign orders with 3-4 sugar companies in the next couple of weeks for supplying and setting up anhydrous alcohol plants,'' the Managing Director of ALIL, Mr Satish Tandon, told Business Line.

The Rs 250 crore Pune-based process engineering company has already entered into a tie-up with the US-based Katzen International Inc for sourcing `molecular sieve' technology to manufacture anhydrous alcohol.

"We can supply and instal plants with capacities ranging from 25,000 litres per day (LPD) to 3 lakh LPD and designed to operate throughout the year,'' Mr Tandon said.

According to company officials, many sugar companies have evinced interest in setting up facilities to produce anhydrous alcohol. These include Triveni Engineers & Industries Ltd, Bajaj Hindustan, Daurala Sugar Works (DCM) and the K.K. Birla-group promoted Upper Ganges Sugar Mills at Seohara in Uttar Pradesh. A typical sugar plant with a capacity to crush 2,500 tonnes of cane per day (tcd) produces roughly 100 tonnes of molasses (assuming 4 per cent content). Considering that one tonne of molasses can generate up to 240 litres of alcohol, it would be possible for the plant to have a facility to produce 25,000 LPD of alcohol.

"The total capital cost of a 25,000 LPD anhydrous alcohol plant, incorporating molecular sieve technology, would be about Rs 1.6 crore,'' the officials said.

The country currently consumes nearly 10 million kilo-litres of petrol every year. At 5 per cent volume blending, this would require around 500 million litres of anhydrous alcohol, entailing an investment of around Rs 100 crore.

Anydrous alcohol differs from the ordinary industrial alcohol (rectified spirit) or potable, i.e. extra neutral, alcohol to the extent that it has a purity level of up to 99.8 per cent. As against this, rectified spirit has only about 95 per cent alcohol, the balance being water and various trace impurities.

While rectified spirit and potabale alcohol are produced through simple binary distillation, production of anhydrous alcohol, however, requires more complex processing techniques. "There are two kinds of processes for producing anhydrous alcohol - azeotropic distillation and molecular sieve technology. We have opted for the latter because it entails lower running cost on account of steam and other utility consumption,'' Mr Tandon said.

The only real competitor to ALIL in anyhdyrous alcohol technology is expected to be Praj Industries Ltd, which is also based in Pune.

The company has already installed two anhydrous alcohol plants for United Phosphorous and Ficom Organics Ltd with capacities of 15,000 LPD and 10,000 LPD, respectively, based on azeotropic distillation technology.

Praj has now tied-up with Delta T - yet another US-based company - for sourcing of molecular sieve technology. "This is a segment that offers tremendous business opportunities,'' Mr Tandon said.

The Indian Oil Corporation has recently issued a tender for purchase of 14.5 million litres of anhydrous alcohol for five of its blending stations in UP and Punjab.

The latest Budget has also provided a sop in the form of clamping a lower surcharge of Rs 5.25 per litre for ethanol-doped petrol, as against Rs 6 per litre for ordinary petrol.

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