Singapore, 28 July (Argus) — Indian state-owned refiner Hindustan Petroleum (HPCL) aims to produce ethanol by the end of the year from its Bihar sugar mills, part of efforts to meet the country's mandate on the gasoline blendstock.

The two sugar mills owned by HPCL will produce around 60 kl/d (380 b/d) of ethanol to meet the blending requirements of Bihar and other neighbouring states, a company official said. The mills have a crushing capacity of more than 3,700 t/d each.

Indian sugar mills have been able to divert excess sugarcane to ethanol production and adjust their production to meet growing demand from oil companies.

India has implemented a 5pc ethanol blending mandate in the country since 2006, but the implementation is only partially successful because of pricing issues. Blending at 5pc requires 600mn l/yr of ethanol.

A few states such as West Bengal, Tamil Nadu, Kerala, Madhya Pradesh, Jharkhand, Orissa and Bihar have had little success in implementing the mandate, market sources said. The rising cost of molasses, a key ethanol feedstock, has also made ethanol production unfeasible for some suppliers.

Send comments to feedback@argusmedia.com
nd/rjd 2.1

If you would like to review other ArgusMedia.com content options, request more information about Argus' energy news, data and analysis services.

Copyright © 2010 Argus Media Ltd - www.ArgusMedia.com - All rights reserved.