China Hainan Yedao to Build Fuel Ethanol Plant

Beijing, July 18 - Beverages manufacturer Hainan Yedao Co. Ltd, together with a state-owned oil company, plans to build a fuel ethanol plant with annual capacity of 100,000 tonnes using cassava as feedstock, Hainan Yedao said on Friday. The 350 million yuan ($50.89 million) project is still pending approval by the government authorities, the company added in a statement posted on the Shanghai Stock Exchange website. It did not name the oil company. To ensure enough supplies of feedstock, the company leased 4,498 hectares of land in Laos to plant cassava earlier this year, it said. The move followed a similar plan by Beihai Gofar Marine Bilogical Industry Co Ltd, which announced last year it would build a 100,000 tonne-per-year cassava-based ethanol plant in the Guangxi region. Beijing has banned the use of grains in fuel ethanol. Hainan Yedao, based in the southern island province of Hainan, did not say if the ethanol will be blended localled but warned investors of potential risks of markets as well as raw material supplies. China mandates use of ethanol-blended gasoline used in cars in 10 provinces, but not Hainan. The country aims to use 2 million tonnes of ethanol by 2010 to help ease its reliance on imported oil. China's current five ethanol plants produce about 1.3 million tonnes.