BEIJING, Sept 18 (Reuters) - Beihai Gofar Marine Biological Industry Co Ltd (600538.SS), in China’s southern region of Guangxi, plans to build a 100,000 tonne-per-year fuel ethanol plant using cassava as feedstock, the company said on Tuesday.
The Shanghai-listed company also plans to raise about 560 million yuan ($74.5 million) in a share placement to finance the project and boost its cash flow, it said in a statement published in the China Securities Journal.
The plant, to be located in the port city of Beihai, will be close to a 200,000 tonne-per-year ethanol plant under construction by China Agri-Industries Holdings Ltd (0606.HK), the listed arm of the country’s largest trading house, COFCO.
The Gofar project is still pending approval from the country’s top planning body, the National Development and Reform Commission, a company official told Reuters.
“But we are confident it would get approval,” he said, adding that operation of the plant was planned for late next year.
COFCO’s project will start operating early next year.
The NDRC, worried by food security and inflation, late last year banned construction of grains-based fuel ethanol projects and is encouraging new projects using non-grain resources, such as cassava and sweet potatoes.
The Gofar official said the company would switch its current 100,000 tonne-per-year distilling facility to fuel ethanol, which will eventually have total capacity of 200,000 tonnes a year after the new plant comes on stream.
Gofar shares rose their 10 percent daily limit to 9.77 yuan on Tuesday. The shares have risen by nearly one-fifth so far this month.
Beijing is promoting the use of environmentally friendly biofuels for blending in cars in nine provinces, including Jilin and Henan, but not in the Guangxi region.
Gofar, founded in 1993, also produces pesticides, fertilisers and pharmaceuticals, the company said on its Web site (www.gofar.com.cn). ($1=7.523 Yuan)