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Australian Biodiesel Group
Opportunities for biodiesel
AOF Forum - 11 October 2006
Randal Jitts – General Manager ABF
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ü ABG is the nation’s largest producer, founded in 2001
ü Two Australian facilities with a capacity of 200 million litres pa.
ü Internally developed technology, offering feedstock flexibility.
ü Vertical integration strategy to secure feedstock supply
ü JV established in North America to develop production facilities.
About ABG Limited
Existing customer base• Independent fuel distributors & retailers• Trucking fleet operators• Local governments• Transport and marine operators
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Why Biodiesel ? – Peak Oil
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Global Markets … not a level playing field
ü Europe – High diesel prices, farmers subsidized for growing energy crops. Importing Canola to meet demand.
ü USA – Gov’t support for Biodiesel use, Soy being replaced by Corn for Ethanol production, changing traditional market forces.
ü Malaysia – Large producer of Palm Oil, building over 12 biodiesel plants currently, pushing up world Palm prices.
ü India – Rapid development of tree plantation based Biodiesel feedstock and biodiesel plants to meet domestic demand.
ü Australia – Limited Biodiesel production and viable feedstocks. Lack of Gov’t incentive for Biodiesel use by growers.
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Australian Biodiesel production ... an update
New expected: circa 650ml pa(Australia only)
Operational: circa 500ml paTOTALS
Barnawartha, VIC – 60ml paBiodiesel Producers
Rutherford, NSW – 12ml paBiodiesel Industries
Narangba, QLD – 45ml paEcotech
Deniliquin, NSW – 125ml paRiverina Biofuels
Geelong, VIC – 150 ml paPort Botany, NSW
Axiom Energy
Port Botany, NSW Darwin, NT – 147ml pa**(near completion)
Natural Fuel Australia
Brisbane feasibility – 45ml Largs Bay, SA – 45ml paPicton, WA – 45ml pa
Aust. Renewable Fuel
North America X 3 sitesNarangba, QLD - 160ml paBerkeley Vale, NSW – 40ml pa
ABG Limited
Construction or DevelopmentOperational CapacityCompany
Other producers/proposals: SA Farmers Fuel, Future Fuels, Evergreen, Biosel
700-800ml per annum of domestic production by 2009 or around 5% diesel market share. (Patersons Securities 2006).
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How is Biodiesel manufactured ?
TrygliceridesUsed
Cooking Oil Tallow
CanolaOil Methanol
CH2
CH
CH2
R'"COO
R"COO
R'COO
3 CH3OH
catalyst
CH2
CH
CH2
HO
HO
HO
+
R'''COOCH3
R'COOCH3
R''COOCH3
triglyceride methyl esters(biodiesel)
glycerol
Methyl Esters
Summer grade Biodiesel
Winter grade Biodiesel
Glycerin
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External pressures on the Biodiesel industry
Feed Qty* UCO
* Tallow* New oil
Feed Price* Weather
* Trade
Oil Price* Peak Oil* Oil wars
Offtake* End User* Oil Co.* Quality
Govt Policy* Tax
* Environment* Specs
BiodieselIndustry
80% of cost
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-4-5137191-5Cloud Point (°C)
$750$950$700$500$550$900$950Approximate Cost MT
33.143.098.393.582.696.597.7FAME (>96%w/w)
114121156165162150155Flash Point (>120 °C)
1352831.279Oxidation stab. (>6h)
Canola
CottonPK Olein
Coconut
UCOTallow
Palm oil
Feedstock considerationsfor Australia
Expensive Limited Qty Imported
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0
50
100
150
200
250
1961
1965
1969
1973
1977
1981
1985
1989
Chickpeas
Triticale
Canola
Soybean
Sunflower
Mushrooms
Lupins
Cotton
Value of ProductionA$ Million
New Crops Since 1960New Crops Since 1960
Australia can not wait for traditionalcrop development programs
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Key requirements for Australia's Future energy crops ?
ü Economic for Growers (realistic sell price and rotational benefits)
ü Economic for Processors (realistic buy price and sell price)
ü Sustainable land use (not competing with food chain)
ü High yield (over 50% oil in seed)
ü Maximum use of by-products (meal, biofumigation)
ü Suit dry land conditions (Drought, greater WUE)
ü Rapid expansion capability (dedicated GM regions)
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Challenges and Opportunitiesfor Biodiesel
ü Supportive Gov’t policy (level playing field for on/off road users)
ü Source of viable feedstock (Limited domestic soft oil supply)
ü Petrodiesel supply chain uptake (Efficient storage, blending, retail)
ü Consistent product quality (Biodiesel code)
ü Support from Engine manufacturers (B20 to B100)
ü Support from all associations (BAA, RFA, AOF, NFF, etc etc…)
ü Support for growers (Regional Sustainable Model)
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Biodiesel Plant
Biodiesel
Crush Mill Glycerin
Oil
Meal
Stock feed
Seed100%
Feed Mill
UCO Tallow
Short term
Medium term
Long term
Oil100%
Regional Sustainable Model
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Questions ?