BIOFUELS

Vietnam beckons biofuels beginner

NEWLY listed Jatoil has reached an agreement to produce biofuel feedstock in Vietnam.

Vietnam beckons biofuels beginner

The company, which floated on the Australian Securities Exchange on January 30, said it had signed a binding memorandum of understanding with Green Energy Biofuel to produce Jatropha oil in Vietnam.

Under the deal, Jatoil will have a 50.6% interest in the joint venture and invest up to $3 million to grow up to 5000 hectares of jatropha.

According to Jatoil, Green Energy Biofuel became the first company to move into the emerging Vietnamese biofuels market and now has two pilot refineries using waste oil.

“The JV will work with Vietnamese government authorities and local communities to establish jatropha production in areas that are currently marginal for agriculture and where biofuel crop cultivation easily quantifies as ‘best use’ for the land,” Jatoil said.

“The new jatropha tree crops are expected to provide much-needed employment in areas of rural Vietnam.

“Vietnamese authorities have acknowledged the potential environmental benefits from development of plantations in these regions, which will not affect forested areas.”

The development in Vietnam adds to Jatoil’s portfolio of Asian projects. The company has already acquired 50% of Indonesian-based PT Biodiesel Austindo and has begun planning its Indonesian jatropha production.

Following an oversubscribed float, Jatoil listed last week at a 20% discount to its 20c offer price.

The company issued 35 million shares at 20 cents each to raise up to $7 million for its initial public offer.

The strong float was followed by a weak ASX debut – Jatoil, trading under the code JAT, hit the boards at 16 cents and fell as low as 12 cents before closing at 13.5 cents, down 6.5 cents on its offer price.

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