Seaoil sees local biofuel demand up by 2011

By Anna Valmero INQUIRER.net ORTIGAS City, Philippines -- Anticipating the growth in local demand for biofuel, Seaoil Philippines Inc. said it will increase its total number of filling stations from 114 to 500 units by 2011, an executive said. Biofuel is an alternative fuel that blends natural substances like ethanol from sugar cane and coco methyl ester (CME) from coconut to regular gasoline and diesel. Seaoil Philippines expects to grow their number of stations by 300 percent because of the anticipated increasing local demand following the signing of the Biofuels Act in 2006, which will become effective in February 2007, said Art Cruz, marketing director of Seaoil Philippines. “The consumers are more mature than before in exploring alternatives available to them. The youth, which are more open-minded in trying the biofuel, is creating the growing demand for it,” he said. The Biofuels Act mandates that 5 percent of the annual volume of gasoline fuel sold and distributed by each gasoline company in the country will comprise bioethanol. This will be required two years after the effectivity of the law or starting February 2009. By February 2011, the Department of Energy will mandate the increase in blend to at least 10 percent bioethanol (E10). A blend of 1 percent coco methyl ester (CME) extracted has taken effect in 2007 for biodiesel and will increase to 2 percent within the next two years. This year, Seaoil Philippines has conducted repiping of its biofuel distribution systems to eliminate localized corrosion from pipes, pumps and tanks, said Bernadette Raymundo, vice president of supply and QCPD. The company has invested P15 million for the project, excluding the costs for the depot sites. The company replaced underground G1 pipes of filling stations with flexy pipes of fluoropolymer base material (Polyvinylidene fluoride-PVDF) to prevent problems in chemical compatibility with the biofuel, said Raymundo. Tanks especially for CME were not coated because coated tanks tend to peel as CME or ethanol penetrates the undercoat adhesion, she added. “The repiping was done to prevent leaks in nearby water pipes to enter the biofuel storage,” said Raymundo. She said any water in the biofuel tank can contaminate the solution. This can cause phase separation of water and ethanol from gasoline. Moisture in gas can emulsify, resulting to a product with hazy appearance. In September, Raymundo presented Seaoil’s biofuel program at the 2008 Ethanol and Biofuels Asia Conference in Singapore. The program, which includes practices in transport, handling, blending, storage and other operational concerns, was recognized as model for adoption in Southeast Asia. “We are the only country in the Southeast Asia with a law on biofuels. This bodes well for the Philippines as it gives us three years advantage in refining the technology and its implementation. With further efforts for development, this creates opportunities for sustainable energy production and thus, achievement of national energy security,” said Cruz. Biofuels bring other benefits aside from cheaper cost, greater engine efficiency from cleaner burn and less air pollution. “Adoption of biofuels will also create market opportunities for the local coconut and sugar cane industries,” said Cruz. The upcoming Asian free trade will create surplus of global products in the local market, which can kill local industries if regulation of imported goods is not well implemented, said Cruz. By tapping the sugarcane and coconut for the production of ethanol and CME, respectively, Cruz said they are creating alternative markets for and support sustainability of the two local industries. In September 2007, the Department of Agriculture validated a total of 60,250 hectares of new sugarcane areas that can produce a combined 274 million liters of bioethanol, Raymundo said. This volume, she said, can meet the requirement under the Biofuels Act on the blending of crop-based alternative fuels with gasoline by 2009. She cited the Sugar Regulatory Administration identified the 60,250 hectares are on top of the existing 388,003 hectares of sugarcane farms that can meet the country's sugar requirements Seaoil has introduced biofuel, specifically the ethanol blended (E10) gasoline, through its 50 local filling stations in August 2005. Raymundo said marketing E10 a year earlier before the Act was signed was difficult. They launched a massive campaign to address the resistance of motorists especially those with carbureted and older model vehicles. “Our efforts to advocate the use of biofuels are gradually paying off,” said Raymundo. “Right now, countries are turning their attention to the Philippines as global biofuel supplier. Countries in Southeast Asia eye the Philippines as a model for starting and implementing a biofuel program.” Seaoil Philippines has teamed up with national Department of Energy, U.S. Department of Energy, U.S. Agency of International Development, Sustainable Energy Development Program and Chemrez Technologies in promoting biofuels. To build motorists’ confidence in biofuels, Seaoil inked an alliance with the Automobile Association of the Philippines in 2006. Up to this day, all cars racing in the Philippine Touring Car Championship run on Seaoil E10 fuels and drivers are impressed by the cleaner burn they get from E10. “Biofuels are preparing the world for the inevitable depletion of petroleum resources,” said Cruz. “And the Philippines is in a good position to reap the benefits of this growing market.