via ‘Green Fuel needs $2bn to complete ethanol plants’ – DailyNews Live by Bernard Chiketo 31 MARCH 2014
Bio-fuel firm Green Fuel requires a whopping $1,8 billion in foreign direct investment (FDI) to complete the construction of four ethanol plants under its investment blueprint, the Daily News can reveal.
The first phase resulted in the construction of the Chisumbanje ethanol plant at the cost of $200 million.
Green Fuel is now looking at the construction of Condo Dam at the cost of $300m to broaden their source of irrigation water expected to increase following the roll out exercise of the remaining phases.
The company is currently taping its irrigation water supplies from Osborne Dam and Lesapi Dam more than 200km away from their site.
According to the investment blueprint document, the second phase — already in motion — attracts $260m while $450m and $1 billion will be injected for the third and final phase, respectively.
The ethanol project was established in 2008 under a partnership between the state-owned Agriculture Rural Development Association (Arda) and private companies, Macdom and Rating Investment.
Arda board chairperson Basil Nyabadza revealed that the total investment would attract more than $1,8 billion.
“The total investment of Chisumbanje ethanol plant will be over $1,8 billion dollars but under various phases. Plans are already there. We only have to finalise the terms of the money, the financing because it’s going to be done under foreign direct investment (FDI),” said Nyabadza.
He added; “The Green Fuel, Arda project is not an event, it’s a process. It has got four phases. We have just completed phase one, which started in 2008. Phase two started this year and the entire project will run up to Phase four.”
The Chisumbanje ethanol plant, expansion exercise runs up to 2020. It will trigger a sharp increase in the volume of ethanol produced, employment creation, power generation, irrigation scheme and mandatory blending ratio.
Ethanol production will increase from 120 million litres per annum to 450 litres thereby pushing the blending ratio to E20 from the current adopted E10.
The power generation will further rise from 18 megawatts to 86MW while employment creation will increase from the current 5 500 to 35 000.
Most importantly, the government will save $12m every month from the fuel importation bill from the current $4m.
The government will also be in a position to export anhydrous ethanol by then and generate up to $20m from export sales.
Moreover, 18 000 families will be feeding from the 4 500ha expected to go under irrigation, which is a sharp increase from the current 4 000 families utilising 1 000ha under irrigation.
Nyabadza said the Chisumbanje ethanol project has huge benefits for the communities and government at large.
“The Chisumbanje ethanol project is the best developmental project in the country at the moment. I understand that it might not be perfect but we should also understand that it is not an event, it’s a process, which will be perfected as time progresses,” he said.