BBGI Co, Asean's largest fully integrated biofuels maker, has announced its finalised development plan for manufacturing bio-based products starting this year.
BBGI is a joint venture of Bangchak Corporation Plc and Khon Kaen Sugar Industry Plc. Bangchak owns 60% and Khon Kaen Sugar 40%.
Together, the firms have five subsidiaries involved in ethanol and biodiesel production.
Ethanol and biodiesel are fundamental raw materials for bio-based products, which BBGI aims to develop in the next stage after listing on the stock market.
Newly named chief executive Pongchai Chaichirawiwat said the plan entails making higher-priced products, including biodegradable plastic polymers, food supplements, medicine, cosmetics and sweeteners.
BBGI has reached out to research and development houses around the world to test high-value products for industrial-scale production.
"There will be breakthrough technology in bio-based products that are cost-effective and match the huge volume of sugar cane and palm oil in the country," Mr Pongchai said. "BBGI will spend US$100 million (3.34 billion baht) on this plan once the study has been concluded."
BBGI will spent 1.5 billion baht to increase its ethanol production capacity to 800 kilolitres per day from 500 KPD. That capacity expansion is expected to be completed by 2019.
Mr Pongchai said financing for such efforts is expected to come partly from the initial public offering and annual operating results.
In the coming years, BBGI further plans to expand ethanol capacity to 1,000 KPD and will seek out a strategic partner or conduct a merger or acquisition to that end.
BBGI has also spent 50 million baht to expand its biodiesel or methyl ester (ME) production capacity to 1,000 KPD from 930.
Managing director Chalus Chinthammit said the company is waiting for energy policymakers to promote the use of higher ME content in biodiesel -- 10% or 20% -- up from the current 7% blend.
The higher content should drive up ME demand, as the country's utilisation rate for ME production is 75% or 6,000 KPD -- a figure set to rise to 7,000 KPD over the next few years.
Mr Chalus said that while global carmakers are keen to promote electric vehicles, a raft of next-generation vehicles set to take off after 2030 will leave plenty of room for biofuels as well.