OF INDIA (Business Times)
Southern Online plans Rs 15-cr bio-diesel project.
By K V Ramana
TIMES NEWS NETWORK
Hyderabad: With the bio-fuel segment
attracting attention from several automobile majors, the industry
too is excited about the prospects in the segment. One of the
rst companies to jump into action is the citybased Southern
Online Bio Technologies Ltd (SBT). The company, which has been
a Category B Internet Service Provider (ISP), has begun its
research and development activity to produce bio-diesel.
"Being an ISP we started working
on diversillcation in 2002 and biotechnology was a clear option.
Production bio-fuel is part of biotechnology according to regulations
and we were excited about the prospects in the segment,"
the company's managing director N Satish Kumar said.
The company has networked with various
institutions including Indian Institute of Science, Indian Institute
of Technology, Indian Oil Corporation and Indian Institute of
Petroleum in addition to Icrisat for arriving at a bio-fuel
The company has finalised its plans to
set up a bio-diesel production centre near Hyderabad with an
in stalled capacity to produce 3,500 litres of bio-diesel per
day. The commercial production is expected to begin in April
"We will use a variety of raw mate
rial including acid oils, used cooking oil, distilled fatty
acids and the oils an extracted from Pongamia and Jatropha seeds.
We are in the process of signing up with suppliers basically
from villages in the state for supplies. Simultaneously, we
will also encourage waste land development project by encouraging
farmers to plant Pongamia or Jatropha," he explained.
The company is planning to buy the seeds
for Rs 4.50 a kg and sell a litre of bio-diesel for Rs 24, which
is about 50 paise less than the price of diesel. "It is
going to be a bulk sale for major organisations and fleet owners
and any vehicle running on diesel can use the fuel," he
The company claims to have secured letters
of interest for purchase of biD-diesel from various organisations
like Indian Railways, AP Lorry Owners Association, some hospitals,
road transport corporations and municipal corporations.
company's project is being executed with an outlay of Rs 15
crore. To fmance the project, the company is planning to go
in for a rights issue, which will help in raising Rs 6 crare.
The remaining would be met through debt. "We have tied
up with Lurgi, a German company for technology and another German
organisation called GTZ is giving a grant of Rs 50 lakh. GTZ
has also agreed to buy carbon from us," Kumar said.