C1 Energy (Shanghai) – Sep 7, 2010 －－－Three state-owned oil giants Sinopec, PetroChina and CNOOC plan to supply B5 biogasoil to replace petroleum-based gasoil in South China's Hainan Province before Oct 1, making it pioneer of all provincial areas, C1's survey found.
In Hainan, only CNOOC has biogasoil plant at present, capable of producing 60,000mt per year with jatropha curcas oil as feedstock.
The other two oil majors would purchase jatropha curcas oil from CNOOC to blend B5 biogasoil.
Ex-refinery price of biogasoil was Yuan 5,943/mt in Hainan at present, versus wholesale ceiling of Yuan 7,350/mt.
The National Development & Reform Commission prescribed ex-refinery price of biogasoil should be 92% of petroleum-based gasoil, while the two products share the same wholesale ceiling.
Private petrol stations in Hainan mostly took wait-and-see attitudes, anxious about sales margins of biogasoil.
A private trader told C1 that the company had plan to sell biogasoil, but it was yet to reach purchase agreement with CNOOC due to divergence in price.
The government gives subsidies to just biogasoil producers instead of sellers at the moment.
The Hainan provincial government promulgated the Blending Standard for B5 Biogasoil as Fuel on Aug 1 and urged prompt implementation.
B5 biogasoil is basically a blend of 95% regular petroleum-based gasoil and 5% biogasoil.
Hazardous chemical content of emissions from an engine burning biogasoil is 50% lower than that consuming petroleum-based gasoil.
