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Logo of Phnom Penh Post newspaper Phnom Penh Post - First ethanol export marks start of lucrative industry, officials say

First ethanol export marks start of lucrative industry, officials say

090106_14_1.jpg
090106_14_1.jpg

Korea’s MH Bio-Energy opens the door to the possibility of lower fuel prices at home, but remains the target of pollution accusations

Photo by: SAM RITH

MH Bio-Energy, Cambodia’s first ethanol plant located in Kandal Province.

A KOREAN company says it completed Cambodia's first ethanol shipment last month, marking a major step forward for the local biofuel industry.

The 9,600-tonne load was produced by MH Bio-Energy Group and exported to Europe for use in gasohol fuel, said Ros Sopharith, senior manager of the company.

The company was formed with more than US$30 million in Korean investment, and includes a factory in Kandal province's Ponhea Loeu district.

Despite the recent success, the company is mired in controversy after being accused by area villagers of spilling toxins into a nearby lake.

The company denies any wrongdoing, and local authorities have not ruled on the villagers' complaints.

Ethanol is refined from dried tapioca supplied from the company's own fields, as well as local farmers'.

"Our ethanol is checked properly and the factory is equipped with high-tech facilities to comply with international standards," Ros Sopharith said.

Operations began in 2007 with a capacity of 120 tonnes per day. About 100,000 tonnes of dried tapioca are used to produce 36,000 tonnes of ethanol for export.

"We have a lot of foreign markets in Asia and Europe," Ros Sopharith said.

"I am prepared to ask government permission to sell ethanol locally because it can protect our environment. In the near future, we plan to double production capacity to meet global market demand."     

For export only

But even with local production in full swing, Cambodian consumers will have to wait for cheaper gasohol to become available at Cambodian pumps, officials say.

Ith Praing, a secretary of state at the Ministry of Industry, Mines and Energy, said that Cambodia does not have the means to produce gasohol locally.

"We hope that we will be able to blend this biofuel in the future to cut petrol costs," he said. 

Sok Sina, an independent economist, said that the factory represents the beginning of a potentially lucrative industry.

"The factory will increase exports and employ a lot of farmers to increase their tapioca capacity," he said,

Even though Cambodia has vast biofuel potential, while suffering at the same time from high petrol prices, the country lags far behind in production and availability.

In Thailand, for example, government support has  led to surging gasohol sales in recent years, with 85-percent ethanol fuel introduced last August.

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