GreenGold shows the jatropha way

A little-known company GreenGold Ray Energies, Inc. (Other OTC:GRYE) issued a press release yesterday that its biodiesel refinery in Nasipit, Agusan del Norte should be opening within 90 days. The GRYE Processing and Refinery Plant which is capable of producing 680 million liters (180 million gallons) of biodiesel a year is designed to use jatropha oil as its feedstock.

To support its plant, GreenGold has been acquiring lands and growing jatropha plants in plantations in Mindanao and Marinduque and has forged supply agreements with local jatropha planters. It has also established a research and development center for jatropha in Cagayan de Oro City.

A model of GreenGold's biodiesel refinery

The investment is seen as a response to Republic Act 9367 or the Biofuels Act of 2006, which requires the use of biofuel blends of up to 10% on vehicle engines within four years. The Philippines is projected to need 150 million liters of biodiesel a year for the next few years to meet the Biofuels Act mandate.

While there are several biofuel plants in various stages of development in the country, the only other large-scale biofuel plant in operation is that of Chemrez Technologies Inc. (PSE: COAT) which uses coconut oil as feedstock. It has a capacity of only a third of GreenGold’s refinery.

Jatropha (Jatropha curcas) has been touted as a viable biodiesel plant since it grows almost anywhere, even on marginal lands. Proponents have endorsed it since the oil is inedible, and should be exempt from the food for fuel controversy.

However, agronomists from the UP Los Baños have shown a few years back that jatropha that grows on marginal lands cannot yield commercially-viable biodiesel, and the only way to increase the yield is to grow it as if it were like any other agricultural crop: fertile land, irrigation and use of fertilizers.

The government, through the PNOC Alternative Fuels Corporation has an ongoing jatropha initiative although it has not yet entered into the commercial phase.

Jatropha as biodiesel

Among the advantages of jatropha crude oil over fossil diesel cited by GreenGold engineers are: (1) it is biodegradable; (2) has higher flash point than petrodiesel ; (3) emits less carbon dioxide;  and (4) can be used alone or mixed with other fuels for vehicle use.

The disadvantages cited are: (1) it is more expensive than petrodiesel; (2) less suitable in cold weather because it may form a gel; and (3) tends to reduce fuel economy on vehicles running using pure biodiesel.

The potential of jatropha as a viable fule was recently demonstrated when Air New Zealand used a 50/50 mix of jatropha oil and jet fuel is a successful test flight. Last month, Houston-based Continental Airlines tested jatropha fuel on one of its jetliners.

If anything, GreenGold is trying to show that the jatropha plant can be made viable as a source biodiesel if grown scientifically and provided with proper requirements just like any other agricultural crop—and not just letting it grow on marginal lands as the government planners originally proposed.