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Mission NewEnergy ships commercial scale jatropha oil to Malaysia
Added 70 days ago - Australia-listed Mission NewEnergy said Thursday that it has shipped commercial quantities of jatropha oil from its extensive network across India to its biodiesel refinery in Malaysia.
Mission said it has aggregated approximately 1,500 mt of seed and believed that to be the single largest ever compilation of jatropha seeds, the company said in a statement filed to the Australian Securities Exchange.
"We are extremely pleased with the Indian operation's ability to effectively consolidate mass quantities of seeds from such a wide geographic dispersion," said Subhas Pattnaik, general manager of Mission's Indian operations.
"The achievement of this milestone clearly demonstrates Mission's logistical capability to harvest commercial quantities of jatropha from the network built over the last three years," he said.
Utilizing only basic oil expelling techniques, Mission has thus far extracted and shipped approximately 188 mt of crude jatropha oil, the company said, adding that it is now introducing solvent extraction methods which have shown will lead to a material increase in oil yield realization, from the current 16% to a range of 20%-30%.
Based on Mission's long-term contract farming rates, oil yields using solvent extraction processes and after byproduct realization, Mission's cost base for jatropha-based biodiesel, landed in Houston, is about $64/barrel, or $1.53/gal. This cost basis represents a 34% discount to the current price of ultra low sulfur diesel, which trades at a premium to unrefined crude oil, it said.
It added that this cost basis does not include the proposed biodiesel blender credit in the US, which would further lower the effective cost to approximately $23/b, or 54 cents/gal.
Biodiesel production in the US has been cut to minimal levels and some plants have shut since the expiry of a $1/gal biodiesel tax credit on December 31, 2009. Last week, the US Senate defeated a bill that included a measure to increase oil industry fees and extend the tax credit through December 31.
Mission NewEnergy owns and operates a 100,000 mt/year biodiesel plant at Kuantan, Malaysia, and is currently commissioning a 250,000 mt/year biodiesel plant - built adjacent to the first facility - that has been delayed many times since work first began in 2007.
Mission was thrown a lifeline in December, when a new supply deal signed with US-based Valero Marketing and Supply Company, a unit of Valero Energy Corp., presented a chance to turn its business around after raking up a A$7.5
million ($6.5 million) loss for the fiscal year to June 30, 2009 in its refining business.
Mission had said the initial supply to Valero will be biodiesel made from palm oil but later jatropha-based biodiesel will comprise a larger share of the total as Mission's supply of the crop in India grows.
So far, Valero has not yet received its first shipment, which Mission had earlier said was expected to take place during the second quarter of this year.
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