Eastern Petroleum forms new firm for alternative fuel
EASTERN Petroleum Corp. is sinking an initial P100 million into a new subsidiary that will focus solely on alternative fuel projects, particularly ethanol.
In an interview with the Philippine Daily Inquirer, Eastern chair and chief executive Fernando Martinez said the new company, Eastern Renewables Corp., would be registered with the Securities and Exchange Commission within the week.
As early as now, however, he said Eastern was already in talks with a Chinese firm for a possible joint venture arrangement.
“We already have a draft agreement with the Chinese firm. They’re just waiting for me to sign it. We should be able to start planting by next month,” he said.
Unlike other planned ethanol facilities in the country, he said the ethanol plant that the new company would put up would use cassava as feedstock instead of sugarcane.
“We want to encourage the planting of cassava because one million hectares of the crop can yield one billion liters of ethanol, or around 20 percent of the country’s yearly consumption,” he said.
For these cassava plantations, he said the company could tap some of the more than 3 million hectares of idle land scattered all over the country.
The Department of Agriculture, through Secretary Arthur Yap, had already committed to provide aid in securing land for the plantations, as well as in providing financing schemes to cassava farmers.
He said Eastern was eyeing an initial 10,000 hectares of land located in various parts of the country, including Cagayan de Oro, Misamis Oriental, Bukidnon, General Santos, Saranggani and Davao.
Initially, the cassava to be harvested from these plantations would be shipped to China for processing, he said.
Shipments should start by December, he added.
“We’ll start a feasibility study on the project as soon as we sign an agreement (with the Chinese firm). When the company becomes more established and we’re already producing cassava in commercial quantities, or about 100,000 metric tons, we can already put up an ethanol plant here,” he said.
He said the plant should already be established within the next two years.
The entire project would entail at least P200 million in investments, he said, with Eastern having a 60-percent stake in it and the Chinese company a 40-percent share.
Information from: business.inquirer.net