SBBF to set up Rs 15 crore bio-diesel plant

Ties up with German company Lurgi for technology transfer

Our Regional Bureau in Hyderabad
Published : February 26, 2004

City-based Southern Biofe Bio Fuels (SBBF) is planning to set up a Rs 15 crore bio-diesel manufacturing plant near the city.

SBBF, founded by the promoters of city-based ISP (internet service provider) Southern Online Services, has entered into an alliance with German company Lurgi for technology transfer.

“In the first phase, we would like to set up the plant with a 30-tonne per day capacity which would be expanded to 300 tonne per day by the end of the fifth year,” N Satish Kumar, managing director of Southern Online, told Business Standard .

“Ours will be the first commercial bio-diesel production unit in the country. We have entered into a tie-up with Lurgi, a German-based company, for obtaining the technology for the plant,” Kumar said.

The company feels that the abundant availability of wastelands near the proposed plant site will make it easier for the procurement of oil-bearing seeds such as pongamia pinnata, jatropha curcas etc by entering into an arrangement with the local farmers and tribals. It has already acquired 10 acres of land to set up the plant near Choutuppal, 50 km from Hyderabad.

Explaining the advantages of bio-diesel, he said that it reduced pollution and increased the engine efficiency of the vehicles. “The production of bio-diesel brings wasteland under cultivation as production of bio-diesel requires oil producing vegetable seeds as raw material. This results in twin benefits – the green cover will increase and farmers can earn more,” he said, adding, “Unlike conventional diesel, bio-diesel is non-flammable.”

The fuel can be used in two forms – as a 100 per cent replacement to the normal fuel, which requires the fuel flowing rubber pipes to be replaced with Teflon pipes, and in the other form, the diesel can be mixed with the conventional diesel in the 20:80 ratio which requires no modification to the engines.

The company has already received an order from the Indian Railways for the proposed production of the fuel, subject to supplying it at a lower price than the conventional diesel. Additionally, SBBF's bio-diesel needs to conform to the American Society for Testing Materials Standards.

Out of the proposed Rs 15 crore project cost, the promoters plan to bring in Rs 4 crore and the rest will be obilized through a term loan from the German Technological Cooperation, a German financial institution.