MFC fund invests B20m in biodiesel maker in Chiang Rai

INVESTMENT / ALTERNATIVE ENERGY

MFC fund invests B20m in biodiesel maker in Chiang Rai

KRISSANA PARNSOONTHORN

Chiang Rai _ MFC Energy Fund has invested 20 million baht to acquire a 25% stake in E-Ester Co, a mid-sized producer of biodiesel in Chiang Rai.

The E-Ester acquisition is the first investment made by the 2.5-billion-baht MFC Energy, a fund focusing on investment in energy businesses.

Pichit Akrathit, the president of MFC, the energy fund manager, said that investing in E-Ester would help the country reduce dependence on imported energy and promote the use of biodiesel.

Moreover, E-Ester has developed its own technology, which is being used to produce V Gen biodiesel at its well-equipped plant in Chiang Rai. The biodiesel production uses palm oil as the raw material.

E-Ester began producing biodiesel on Monday at the rate of about 50,000 litres per day when the plant was officially opened by Prime Minister Surayud Chulanont. ''After a strict assessment, we found that E-Ester is a good investment. It will generate a return as high as 40%,'' Dr Pichit said.

E-Ester has paid-up capital of 80 million baht. Its three co-founders are Surathian Chakthranont, the former president of SC Asset Corp; Viroon Kumpilo, the owner of Viroon Business and Technology Chiang Rai School; and Wichai Jaivisuthunsa, the former dean of the Science and Technology Faculty at Rajabhat Kampangpetch University.

The three had researched V Gen biodiesel in a small laboratory at V-BAC for two years before it was ready for commercial sale.

Mr Surathian, who is also the E-Ester chairman, said the maximum production capacity at the Chiang Rai plant would rise to 100,000 litres a day in the future when local supply of palm oil increased.

Currently, Chiang Rai has about 15,000 rai of palm-tree plantations and up to 120,000 rai could used to grow palm trees by 2010, given rising palm-oil prices.

''Biodiesel is priced lower than diesel and the supply is still limited. So, we're confident that many motorists, especially 10-wheel trucks, will switch to use our V Gen bio-diesel,'' he said.

Chiang Rai consumes about 700,000 litres of diesel a day. Mr Surathian said E-Ester planned to build the second production plant in the Phetkasem area in Bangkok later this year.

The location for the third plant could be in the South or the Eastern Seaboard. When the three plants operate at their full capacities, the combined output will be 300,000 litres a day.