desert burner
March 31st, 2010, 01:24 PM
At the dawn of this year, Sudan hit headlines with some serious ethanol exports from Kenana, a production plant located 250km south of Khartoum. The export, a 5 million litres batch of ethanol to the European Union, at an initial price of 450 Euros cubic metres, was just an initial step in an ambitious journey.
According to Sudan officials, Kenana, Sudan's largest sugar company, aims to produce 65 million litres a year of the biofuel.
Last year, Khartoum spoke about plans to construct 18 ethanol plants to boost production in the country, a move seen as one of the ways to introduce a new income stream, especially for the government that faces a likely secession by the Southerners in the next year’s referendum.
Currently, most of the unexploited oil fields are in Southern Sudan.
At the current price, the Kenana plant production would earn up to $39 million a year. Although dwarfed by the $11.6 billion the country earned from crude oil exports in 2008, Sudan’s venture into Ethanol seems a prudent long term investment. Only last year, Brazil, the world’s second largest producer of ethanol after the US, exported up to 23.4 billion litres that, at the export price of Sudan, would have earned it $13.6 billion. This points to a lucrative industry if well managed.
Government shares
In the Kenana project that uses sugarcane molasses, the Sudanese Government owns 35.33 per cent of the company capital, followed by the Kuwait Investment Authority, which holds 30.64 per cent, and the Saudi Arabian Government, which owns 10.97 per cent. The other owners are mostly foreign interests with minor shareholdings.
Eltayeb Mohamed Abdelgadir, a researcher at the Sudan-based Agricultural Research Corporation, said that in addition to Kenana, most of Sudan was well-suited for biofuel production because of its vast, uncultivated land and low agricultural and labour costs.
In pursuit of this green ambition, Sudan plans to increase its production of ethanol to 400 million litres every year when the White Nile and Blue Nile Sugar factories start generating the sugar by-product, said Sudan’s minister for Industry Ali Ahmed Osman.
Ethanol promises to be one of Africa’s first major fully processed export commodities, breaking a historical jinx that has seen Africa export low value unprocessed commodities to the international market. In the past, Africa, except in South Africa, has produced ethanol mainly for domestic consumption, a fact that plays out in the lack of production data even in the domestic markets. In Kenya, for instance, companies that produce ethanol, only sell to local and regional markets.
Climate change
Countries like Malawi are pioneering blending of ethanol and petrol that is already being done there. Malawi, Kenya, South Africa, Zimbabwe, Zambia, Mozambique and now Sudan, are some of the countries processing ethanol from sugar waste.
But with climate change, concerns and the potential of the carbon-free biodiesel to mitigate against the destructive phenomenon, coupled with political uncertainty in oil producing countries, are reasons that favour the increase of ethanol production in Africa.
Moving with the current trends, the European Union has set a target of blending its fossil fuel with 20 per cent biofuel, in principal ethanol by 2020. And this is how the African producers come into this market.
A study carried out last year by African biofuels trade association Partners for Euro-African Green Energy (PANGEA), showed that even with the planned construction of ethanol factories in the EU and its imports from Brazil, the bloc will still have a deficit of 5-8 billion litres of ethanol by 2020, and this could come from Africa.
Technology transfer
Data shows that ethanol import needs for EU are already changing. In 2008, EU imported an estimated 1.9 billion litres of ethanol, a substantial increase compared to 2007. Almost 1.5 billion litres of this came from Brazil.
EU seems to have made a long time bet to outsource its ethanol needs from Africa, counting on the continent’s potential to produce the commodity by growing bio fuel crops from its vast fertile, but idle land.
Last year, an Africa-EU Energy Partnership was signed to facilitate bio-energy processing technology transfer and the general cooperation on bio-energy.
So far, a number of African countries appear to have smelt the market and have in place, or are almost finalising their national biofuel targets such as South Africa, Egypt, Morocco, Kenya, Madagascar, Rwanda, Cape Verde and Mali.
http://www.africareview.com/Business%20&%20Finance/Khartoum%20looks%20beyond%20oil%20politics/-/825446/873358/-/vfh6gl/-/index.html
According to Sudan officials, Kenana, Sudan's largest sugar company, aims to produce 65 million litres a year of the biofuel.
Last year, Khartoum spoke about plans to construct 18 ethanol plants to boost production in the country, a move seen as one of the ways to introduce a new income stream, especially for the government that faces a likely secession by the Southerners in the next year’s referendum.
Currently, most of the unexploited oil fields are in Southern Sudan.
At the current price, the Kenana plant production would earn up to $39 million a year. Although dwarfed by the $11.6 billion the country earned from crude oil exports in 2008, Sudan’s venture into Ethanol seems a prudent long term investment. Only last year, Brazil, the world’s second largest producer of ethanol after the US, exported up to 23.4 billion litres that, at the export price of Sudan, would have earned it $13.6 billion. This points to a lucrative industry if well managed.
Government shares
In the Kenana project that uses sugarcane molasses, the Sudanese Government owns 35.33 per cent of the company capital, followed by the Kuwait Investment Authority, which holds 30.64 per cent, and the Saudi Arabian Government, which owns 10.97 per cent. The other owners are mostly foreign interests with minor shareholdings.
Eltayeb Mohamed Abdelgadir, a researcher at the Sudan-based Agricultural Research Corporation, said that in addition to Kenana, most of Sudan was well-suited for biofuel production because of its vast, uncultivated land and low agricultural and labour costs.
In pursuit of this green ambition, Sudan plans to increase its production of ethanol to 400 million litres every year when the White Nile and Blue Nile Sugar factories start generating the sugar by-product, said Sudan’s minister for Industry Ali Ahmed Osman.
Ethanol promises to be one of Africa’s first major fully processed export commodities, breaking a historical jinx that has seen Africa export low value unprocessed commodities to the international market. In the past, Africa, except in South Africa, has produced ethanol mainly for domestic consumption, a fact that plays out in the lack of production data even in the domestic markets. In Kenya, for instance, companies that produce ethanol, only sell to local and regional markets.
Climate change
Countries like Malawi are pioneering blending of ethanol and petrol that is already being done there. Malawi, Kenya, South Africa, Zimbabwe, Zambia, Mozambique and now Sudan, are some of the countries processing ethanol from sugar waste.
But with climate change, concerns and the potential of the carbon-free biodiesel to mitigate against the destructive phenomenon, coupled with political uncertainty in oil producing countries, are reasons that favour the increase of ethanol production in Africa.
Moving with the current trends, the European Union has set a target of blending its fossil fuel with 20 per cent biofuel, in principal ethanol by 2020. And this is how the African producers come into this market.
A study carried out last year by African biofuels trade association Partners for Euro-African Green Energy (PANGEA), showed that even with the planned construction of ethanol factories in the EU and its imports from Brazil, the bloc will still have a deficit of 5-8 billion litres of ethanol by 2020, and this could come from Africa.
Technology transfer
Data shows that ethanol import needs for EU are already changing. In 2008, EU imported an estimated 1.9 billion litres of ethanol, a substantial increase compared to 2007. Almost 1.5 billion litres of this came from Brazil.
EU seems to have made a long time bet to outsource its ethanol needs from Africa, counting on the continent’s potential to produce the commodity by growing bio fuel crops from its vast fertile, but idle land.
Last year, an Africa-EU Energy Partnership was signed to facilitate bio-energy processing technology transfer and the general cooperation on bio-energy.
So far, a number of African countries appear to have smelt the market and have in place, or are almost finalising their national biofuel targets such as South Africa, Egypt, Morocco, Kenya, Madagascar, Rwanda, Cape Verde and Mali.
http://www.africareview.com/Business%20&%20Finance/Khartoum%20looks%20beyond%20oil%20politics/-/825446/873358/-/vfh6gl/-/index.html