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South China Morning Post July 15, 2008 Tuesday Oil firms get go-ahead to build biodiesel plants using jatropha BYLINE: Eric Ng Beijing has given the approval to the nation's three largest oil producers to build three demonstration biodiesel plants using jatropha as raw material, to spur sustainable development of the nascent clean energy industry. The approval came as the industry is hurt by rising cost of feedstock waste vegetable and cooking oil. Jatropha, a non-food plant, is an alternative feedstock. The National Development and Reform Commission said it had approved PetroChina's 60,000 tonne-a-year biodiesel project developed by its refining and petrochemical unit in Nanchong, Sichuan province. The project costs 180 million yuan ($205HK.8 million) and is scheduled to come on stream by the end of the year. China's 50,000 tonne-a-year plant in Guizhou province and China National Offshore Oil Corp's 60,000 tonne-a-year plant in Hainan were also approved. All three projects use jatropha as feedstock. Discovered in southern China, jatropha is a hardy plant that can grow in harsh environment and tolerate dry and hot weather. Investment in biodiesel has been growing on the mainland as the government encourages the use of clean energy. Total output capacity was estimated to rise to 4 million tonnes this year from 3 million tonnes last year, China Agricultural Products Trading Centre said. However, due to surging waste vegetable oil prices and fuel price control, many developers had suspended or scaled back their projects, it added. Britain-listed China Biodiesel International Holdings and US-listed China Clean Energy, caught by surging material costs, have switched some of their diesel production capacity to more lucrative chemicals production after profit declined. The nation's largest biodiesel producer, Gushan Environmental Energy, which has procurement contracts for up to three years, has however kept expanding capacity and continued to post profit growth. China Biodiesel's share price slumped 42.86 per cent year-to-date, compared to a 63.78 per cent plunge in China Clean Energy and a 20.64 per cent gain in Gushan. -- GRANOVSKAYA,YELENA Environmental and Life Sciences