HARARE: British firm Sunbird Bioenergy has partnered government to set up a $150 million ethanol operation in Zimbabwe next year, an official has said.
The deal will see the establishment of an ethanol plant with capacity to produce up to 120 million litres of ethanol annually and generate 33 megawatts of electricity from biomass. Zimbabwe will hold a 10 percent stake in the operation which will progressively be increased to 51 percent over 10 years.
Speaking after signing a Memorandum of Understanding with government officials on Thursday, Sunbird Bio Energy chief executive Richard Bennet said $60 million would go towards plant construction while $90 million would finance an agriculture development programme. Bennet said the ethanol would be extracted from cassava.
“We intend to put 40,000 hectares under cultivation and half of that will be set aside for out-growers. We will encourage small scale farmers to grow cassava. Our ambition is to have 20,000 small-scale farmers involved,” he said.
Agriculture secretary Ringson Chitsiko said Zimbabwe had a desperate need for power and that ethanol production would go a long way in reducing fuel costs as well as giving income to small-scale farmers in the rural areas In 2013, Zimbabwe’s government introduced mandatory blending in a bid to contain the country’s ballooning fuel bill and increased the blending threshold to E15 from E10 early last year.
Currently, Green Fuel, a joint venture between the government’s Agricultural and Rural Development Authority (Arda) and businessman Billy Rautenbach’s Macdom and Rating Investments, is the country’s sole producer of ethanol for blending purposes and has in several instances failed to meet demand. It has instead, undertaken to set up a $500 million ethanol producing plant in Zambia.
Sugar processor Hippo Valley has made known its intentions to enter the ethanol producing industry and is currently engaged with Zimbabwe’s energy regulator to acquire the relevant licences.
