Praj Industries Provides Technology to Build One of Europe's Largest Bio-Ethanol Plants

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Researched by Industrial Info Resources (Sugar Land, Texas)--Praj Industries (BOM:522205) (Pune, India) will work with a consortium of leading United Kingdom-based companies to construct one of the largest bio-ethanol plants in Europe. The consortium, formed by BP plc (NYSE:BP) (London, United Kingdom), Associated British Foods plc (LSE:ABF) (ABF) (London) and Dupont (NYSE:DD) (Wilmington, Delaware), will use the globally recognized technology developed by Praj Industries to convert feedstock, including sugar beets and wheat, into ethanol.

The production capacity of the plant, located 6 kilometers from Kingston upon Hull in the U.K., will be around 110 million gallons per year. The plant site will be the Salt End production complex, where BP's acetic acid production facility is also located. The Salt End plant is one of the largest acetic acid production facilities in Europe. A pilot plant for bio-butanol production will also be set up. The ethanol plant will be commissioned for operation by late 2009.

The technology developed by Praj Industries will produce ethanol by distilling wheat after fermentation. The ethanol produced will be mixed in different proportions with petrol and will be used as fuel for vehicles. In addition to ethanol, the process will also yield wet and dry distillers grains, which are used extensively in the animal feeds industry. Wheat will be procured from two subsidiaries of Associated British Foods: Associated British Agriculture (Peterborough, U.K.) and Frontier Agriculture (Lincoln, U.K.). The total investment on this project is estimated to be about $276 million. A loan from the European Investment Bank (Luxembourg) accounts for $82.8 million of this amount. In addition to creating jobs during the engineering and construction phase, the ethanol plant will also provide full time employment to over 70 people.

In December 2006, Aker Solutions ASA (OSL:AKSO) (Lysaker, Norway) and Praj Industries submitted the feasibility report, after which the front-end engineering and design (FEED) contract was also awarded to the company. Aker Solutions, in association with BioCnergy Europa (Zoetermeer, Netherlands), completed the FEED study. BioCnergy Europa is a joint venture between Praj Industries and Aker Solutions, with Praj Industries holding a 60% stake and Aker Solutions the remainder. Aker Solutions will also undertake the engineering, procurement and construction of the project. Plant equipment and other machinery will be supplied by Praj Industries.

Praj Industries is a global player in brewery and alcohol bio-processing and bio-engineering technology solutions. In December 2008, the company was named as one of "Asia's Best Under a Billion" by Forbes magazine for the second time. Praj has successfully completed projects in China, Columbia, Brazil, the United States and Europe. Recently, Pantaleon (Guatemala City, Guatemala), one of Central America's largest and oldest sugar-manufacturing groups, selected Praj Industries to design and develop two ethanol plants with a combined capacity of 67 million gallons per year.

In 2005, the United Kingdom announced the Renewable Transport Fuel Obligation, which will make it mandatory that at least 5% of the vehicles on the road in 2010 should use bio-fuels. In the long term, the use of bio-fuels will considerably reduce dependence on fossil fuels and bring down greenhouse-gas emissions.

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