The Hindu Business Line : Oil cos ask biodiesel producers to submit expressions of interest

But since the bio fuel projects themselves are at a nascent stage the oil companies are first assessing the quantity of bio fuel that can be sourced.

Chennai , Dec. 2

BIO DIESEL, the automobile fuel from plant sources, will get a much needed boost with oil companies announcing a programme to procure bio diesel from manufacturers.

Indian Oil Corporation, Hindustan Petroleum, Bharat Petroleum and IBP have asked bio diesel manufacturers to put in proposals and expressions of interest on their capacity to supply the fuel.

Suppliers will have to provide a range of information on their production capacity, technology, product quality, acreage of bio fuel crops such as jatropha, and their cultivation — captive and contract farmed.

Oil company officials said that the move is in line with the Government's policy of encouraging alternatives to fossil fuels.

But since the bio fuel projects themselves are at a nascent stage the oil companies are first assessing the quantity of bio fuel that can be sourced. Initially, they will only look at bulk suppliers — those who can supply the bio fuel in tanker loads. They are yet to take a decision on small-scale suppliers who now dominate the market, they said.

Since the volume of diesel consumption is huge — in Tamil Nadu alone about two lakh tonnes a month — a five per cent blend of bio fuel presents huge savings. Annual consumption across the country is about 400 lakh tonnes a year, according to sources.

Meanwhile, industry sources welcomed the move as a further step towards using renewable sources of fuel. But it is only a token step in deference to the policy announced by the Centre, which has said that the programme has to be launched in January 2006.

There are no large-scale producers of bio diesel as yet. There are just a few pilot projects with IOC and the Indian Railways that produce a few hundred litres a day.

There are a few traditional oil mills supplying non-edible oils but as of now it is unlikely that bio diesel of fuel quality will be available in bulk, they said.

The oil companies have announced that suppliers in Tamil Nadu, Pondicherry, Karnataka, and Andhra Pradesh are eligible to submit the expressions of interest.

Purchase centres have been set up at Korukkupet, Chennai (IOC) and Narimanam (IBP) and Karur (BPC), Tamil Nadu; Devangonthi, Bangalore (IOC), Mangalore (IOC) in Karnataka; and Ghatkesar (HPC), Andhra Pradesh.

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