Malaysia’s Lereno to finally start up biodiesel plant

13 July 2007 08:06  [Source: ICIS news]

SINGAPORE (ICIS news)--Malaysian biodiesel producer Lereno plans to go ahead with production at its delayed 60,000 tonne/year facility despite the challenging conditions brought about by current high feedstock crude palm oil prices, a company executive said on Friday.

 

It will start up its new plant in Perak state in one or two weeks’ time, two months later than originally scheduled due to mechanical issues, said managing director Giorgio Vanalli.

 

Lereno earlier said it planned to start up the plant in May.

 

The facility was at the pre-commission stage, he said, adding that it would start producing at 30% capacity and scale up to 100% within a month.

 

“The selling price of biodiesel has not moved proportionally higher…its taking time to adjust,” he said, acknowledging that the “situation [was] very difficult” for the biodiesel industry worldwide with the prices of other vegetable oils soaring over the last few months.

 

Vanalli, however, expected some reprieve soon due to surging crude oil prices, which have gone over $70 per bbl over the past two weeks as well as its Singapore parent

Lereno Bio-chem’s latest strategy to vertically integrate.

 

The company said on Thursday it had acquired two palm oil plantations in Indonesia to secure feedstock for its biofuels business.

 

“This will allow Lereno to have better flexibility in securing forward contracts at better prices, but the effect [of the acquisition will not be reflected] immediately,” he said.

By: Jeanne Lim
+65 6780 4359

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