Bangkok, Thailand -- Thailand will introduce E85 gasohol in the third quarter of this year, a full three years ahead of earlier plans, Finance Minister Surapong Suebwonglee declared yesterday. Authorities yesterday also told local oil refineries they must accept lower margins on diesel fuel in order to help finance a new stabilisation fund.
The announcements came in light of continuing gains in world oil prices, which topped $135 a barrel earlier this week but were trading around $132 in London markets yesterday.
Ethanol production, mostly from molasses and cassava, has jumped as authorities look to reduce the country's dependence on imported crude oil.
E85 is a blend of 85% ethanol and 15% premium petrol. E10, containing 10% ethanol, is already widely used in the local market. Authorities introduced E20 this year as local automakers began to offer E20-compatible cars.
It is not clear whether the country could produce enough ethanol to meet demand for E85 fuel.
''Accelerating the rollout of E85 ... is one of a package of new measures that we will adopt to help address the energy crisis,'' Dr Surapong said.
He said economic ministers would review details of the new energy package on Monday.
''E85 will help reduce fuel costs for consumers. Pump prices will be cheaper than standard petrol by as much as 10 baht per litre,'' he said.
Dr Surapong said world automakers already had developed E85-compatible engines overseas, and they could be imported into the country for local use. Carmakers with domestic production facilities could also open new lines to produce E85-compatible cars.
''We need to create new options for the public in using fuel, whether it be NGV (natural gas for vehicles), LPG (liquefied petroleum gas) or gasohol,'' Dr Surapong said.
Currently only Volvo offers E85- compatible cars in the local market, with its C30 sedan launched last year.
Pornchai Rujiprapa, the permanent secretary of the Energy Ministry, said the early introduction of E85 should not be a problem, as demand was likely to be low in the early stages.
''Very few cars can run on E85, so it shouldn't be a problem. If we are to encourage motorists to use E85, the automakers need to be ready as well,'' he said.
The listed refiner and retailer Bangchak Petroleum late last year began a pilot test of E85 fuel and is currently gearing up for a commercial launch.
Oil refineries, meanwhile, were told yesterday to accept lower margins on diesel, with the savings used to help finance a ''crisis management'' fund.
Energy Minister Poonpirom Liptapanlop said refineries were enjoying huge margins due to high oil prices.
The refineries, largely controlled by the majority state-owned PTT Plc, should help finance a new management fund using part of their refining profits, she said. No details on the policy or fund was announced.
Margins between Dubai crude prices and Singapore diesel prices rose to US$44 per barrel on Thursday, compared with an average $35 in April. Gross refining margins averaged $5 to $6 per barrel in April.
Lt-Gen Poonpirom said margins for refineries differed based on their technology and type of refined oil produced.
But she said the policy would cover Bangchak, Thai Oil Plc, PTT Aromatics and Refinery, and IRPC, which collectively account for 70% of the country's refining capacity of 995,000 barrels a day. Executives of the four companies will meet with the minister on Monday.''This is not market intervention. [The government] is asking for help for the poor amid high oil rice volatility,'' Lt Gen Poonpirom added.
Manoon Siriwan, a local energy expert, said margins were not unreasonably high, as they offset energy companies' losses from their sales of subsidised LPG and low-margin fuel oil.
The firms also used their refining profits to help offset losses from retail operations, he added.
[Source : Bangkok Post 24/05/2008]
The announcements came in light of continuing gains in world oil prices, which topped $135 a barrel earlier this week but were trading around $132 in London markets yesterday.
Ethanol production, mostly from molasses and cassava, has jumped as authorities look to reduce the country's dependence on imported crude oil.
E85 is a blend of 85% ethanol and 15% premium petrol. E10, containing 10% ethanol, is already widely used in the local market. Authorities introduced E20 this year as local automakers began to offer E20-compatible cars.
It is not clear whether the country could produce enough ethanol to meet demand for E85 fuel.
''Accelerating the rollout of E85 ... is one of a package of new measures that we will adopt to help address the energy crisis,'' Dr Surapong said.
He said economic ministers would review details of the new energy package on Monday.
''E85 will help reduce fuel costs for consumers. Pump prices will be cheaper than standard petrol by as much as 10 baht per litre,'' he said.
Dr Surapong said world automakers already had developed E85-compatible engines overseas, and they could be imported into the country for local use. Carmakers with domestic production facilities could also open new lines to produce E85-compatible cars.
''We need to create new options for the public in using fuel, whether it be NGV (natural gas for vehicles), LPG (liquefied petroleum gas) or gasohol,'' Dr Surapong said.
Currently only Volvo offers E85- compatible cars in the local market, with its C30 sedan launched last year.
Pornchai Rujiprapa, the permanent secretary of the Energy Ministry, said the early introduction of E85 should not be a problem, as demand was likely to be low in the early stages.
''Very few cars can run on E85, so it shouldn't be a problem. If we are to encourage motorists to use E85, the automakers need to be ready as well,'' he said.
The listed refiner and retailer Bangchak Petroleum late last year began a pilot test of E85 fuel and is currently gearing up for a commercial launch.
Oil refineries, meanwhile, were told yesterday to accept lower margins on diesel, with the savings used to help finance a ''crisis management'' fund.
Energy Minister Poonpirom Liptapanlop said refineries were enjoying huge margins due to high oil prices.
The refineries, largely controlled by the majority state-owned PTT Plc, should help finance a new management fund using part of their refining profits, she said. No details on the policy or fund was announced.
Margins between Dubai crude prices and Singapore diesel prices rose to US$44 per barrel on Thursday, compared with an average $35 in April. Gross refining margins averaged $5 to $6 per barrel in April.
Lt-Gen Poonpirom said margins for refineries differed based on their technology and type of refined oil produced.
But she said the policy would cover Bangchak, Thai Oil Plc, PTT Aromatics and Refinery, and IRPC, which collectively account for 70% of the country's refining capacity of 995,000 barrels a day. Executives of the four companies will meet with the minister on Monday.''This is not market intervention. [The government] is asking for help for the poor amid high oil rice volatility,'' Lt Gen Poonpirom added.
Manoon Siriwan, a local energy expert, said margins were not unreasonably high, as they offset energy companies' losses from their sales of subsidised LPG and low-margin fuel oil.
The firms also used their refining profits to help offset losses from retail operations, he added.
[Source : Bangkok Post 24/05/2008]
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