Corporate News

URC starts taking fuel ethanol orders

Posted on December 22, 2014

LISTED food giant Universal Robina Corp. (URC) has started taking orders for ethanol fuel it produces from molasses from its sugar mills in Negros and that could be blended with gasoline.

A PLANTATION WORKER extracts juice to make unrefined sugar in La Castellana, on the central Philippine island of Negros, in this photo taken on Jan. 31, 2008. A law mandating a 10% blend of ethanol fuel -- a by-product of sugar -- has encouraged Philippine companies like Universal Robina Corp. to invest in a fuel ethanol plant.
Its first client is Flying V, a brand owned by TWA, Inc., the Gokongwei-owned conglomerate said in a statement over the weekend.

“Under an agreement signed on Dec. 8, URC will supply Flying V with fuel-grade anhydrous ethanol suitable for gasoline blending,” URC said in the statement.

Flying V -- which operates over 350 service stations nationwide -- will use the ethanol in a bid to meet the government-required bioethanol mix in its gasoline products.

The Biofuels Act of 2006 mandates a 10% ethanol blend on all gasoline products sold in the Philippines to cut the country’s dependence on imported fuel. Ethanol can be produced from common crops like sugar cane.

In the statement, URC said it will source the supply needs of Flying V from its newly inaugurated fuel ethanol plant in Barangay Tamisu, Bais City in Negros Oriental.

The facility can make 100,000 liters per day of fuel-grade ethanol using sugar molasses generated from three sugar mills in the province.

“URC fully supports the government’s renewable energy program,” Rene P. Cabati, general manager of URC’s sugar business unit, said in the statement.

The fuel supply deal would also help the domestic sugar industry to diversify especially in the face of stiffer competition when the Association of Southeast Asian Nations (ASEAN) becomes a single economic bloc next year, he said.

The tariff on imported sugar is seen to fall by 5% by 2015, URC said.

“This diversification into a higher-value product from a widely available crop in the Philippines will prepare the local sugar industry for ASEAN integration,” he added.

The fuel ethanol plant is one of two projects URC undertook to support the government’s renewable energy program and its search for alternative uses for sugarcane.

The company is also commissioning a 46-megawatt biomass cogeneration power plant in Negros Occidental, which will supply the power requirements of its facilities.

URC makes consumer food, grows poultry and hogs, as well as manufactures animal feeds, flour and sugar.

Shares of URC were last traded at P195 apiece, gaining P5 or 2.63%. -- Claire-Ann Marie C. Feliciano