Singapore, 26 July (Argus) — Chinese private-sector energy firm China Integrated Energy plans to double its biodiesel production capacity to 200,000 t/yr (4,000 b/d) by the end of this year through internal expansions and an acquisition.

The firm has signed a letter of intent to buy a Sichuan-based company with a 50,000 t/yr capacity for an estimated $16.5mn. The Sichuan plant's feedstock is mainly waste cooking oil and vegetable oil residue. China Integrated will complete due diligence aiming for a final agreement by the end of the third quarter.

China Integrated also plans to build a new 50,000 t/yr biodiesel facility at Tongchuan in Shaanxi province, next to the company's existing 100,000 t/yr plant.

With China a net importer of vegetable oils, Beijing is not promoting biodiesel as a transport fuel. Biodiesel is neither officially distributed through retail outlets nor is there a national biodiesel standard. Producers sell it directly to users, without taxation or direct fuel subsidies.

China's biodiesel output will only be 2.5mn t this year, according to the country's economic planning agency, the NDRC.

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