Malaysian-German Partnership To Build Biodiesel Plants

February 16, 2006 Johor Bahru, Malaysia [RenewableEnergyAccess.com] Two new biodiesel plants to be built by a Malaysian-German partnership will be located on a 20 hectare site at Tanjung Langsat Industrial Area in Johor Bahru and the other at Singapore's petrochemical hub of Jurong Island. The biofuel partnerships call for Kulim holding 51% in the Johor plant while CremerOleo would take up the rest. The German company would have majority stake in the Singapore facility.

Diversified palm oil group, Kulim (Malaysia) Berhad, sealed its partnership with Germany's CremerOleo GmbH & Co., as they plan to set up plants in Johor and Singapore to produce biofuel and other downstream specialty chemical derivatives this year.

"Seen through the eyes of a producer and raw Thmaterial supplier, biodiesel is a local business around the world. However, as a fuel it is also part of the global energy network. With our production and trade of bio commercialize fuels we help to integrate and commercialize renewable energy in these global markets," said Thomas Cremer, managing director of Cremer Gruppe.

The plants will have total capacity of 200,000 tons per annum -- 100,000 tons in Tanjung Langsat and 100,000 tons in Jurong -- producing methyl esters for biodiesel and glycerin as byproduct bound for the export markets, mainly the European Union countries. Both plants are expected to be in production as early as 2007.

According to the release, as global demand for biodiesel is expected to exceed 10 million tons in the next few years. Datuk Peter Chin Fah Kui, a Plantation Industries and Commodities Minister, said recently that Malaysia can be positioned to capture at least 10% of the overall market.

"We definitely want to have a slice of this lucrative market," said Ahamad Mohamad, managing director of Kulim. "In the European Union for example, biodiesel production almost doubled from 1.06 million tons in 2002 to 1.93 million tons last year. In the U.S., biodiesel output has gone from 500,000 gallons in 1999 to 25 million gallons in 2004."

The Malaysian government, in public support of its country's biodiesel production capacity, is drafting a national biofuel policy and will trial biodiesel on state-owned diesel-powered transport vehicles from three of its ministries: defense, transport and plantation.