Repsol YPF Will Invest $30 Million to Build Biodiesel Plant in Argentina, an Industrialinfo.com News Alert.

CORDOBA, Argentina -- Through its Applied Technology Center (CTA), located near the La Plata Refinery in Buenos Aires (Argentina), Repsol YPF (NYSE:REP) has established the Argentinean Bio Fuel Investigation Center. Repsol YPF, the Spanish-Argentinean petroleum company, estimates that it will begin making biodiesel at the plant in 2007. Repsol YPF hopes to become the first major producer of this renewable fuel in Argentina.

Biodiesel is an alternative fuel for diesel engines of renewable origin derived from vegetable oils (soy, colza, sunflower, etc) and/or animal fat. It is one of the fuels used to reduce pollution and could serve as one of the replacements for petroleum fuels in the future.

Repsol YPF will invest $30 million to build the Argentinean Bio Fuel Investigation Center. The plant is expected to produce 120 thousand cubic meters of biodiesel per year, which will initially be combined with diesel fuel in a 5% proportion. In the future, biodiesel will comprise 10% of diesel fuel.

Enrique Locutura, President of Repsol YPF for Argentina, Bolivia, and Brazil, announced that construction of the biodiesel plant will begin in 2006 in Ensenada (a suburb of Buenos Aires). Locutura also stated that the bio fuel plant will run at full capacity by the end of 2007.

Currently, 98% of the biodiesel produced in the world is produced in Europe. Germany is the country with the highest production capacity. Through the Argentinean bio fuel project, YPF is ensuring South America follows in Europe's footsteps by integrating bio fuels into currently used fuels in order to take better care of the environment.

In Argentina, one of the most common alternative fuels is Compressed Natural Gas (CNG), which is a mixture of propane and butane. It is a gas, but it becomes a liquid at high pressures, and it is stored as a liquid in automobiles. CNG reduces carbon monoxide emissions by 70%. In Argentina there are two million vehicles that are CNG compatible, making it one of the largest users of CNG in the world.

Other Similar Experiences with Bio Fuel in Argentina

A group of researchers at the Facultad Regional Villa Maria, Universidad Nacional Tecnologica (UTN) (National Technologic University in Cordoba, Argentina), started biodiesel production in October 2005 within a plant they designed. The plant has a capacity of four thousand liters per day and is twenty meters in length and twenty meters wide. It basically has two modules: one that extracts colza oil, and the other, which transforms the colza oil to produce biodiesel. The fuel is of superb quality and it replaces diesel fuel used in trucks and farm tractors.

The project was launched in Tancacha, Cordoba, Argentina, together with the Argentinean Agrarian Confederation, an entity that also participates in the project. More than fifty farmers were invited to the production of the first 500 liters of biodiesel.

In Argentina, biodiesel is not taxed, unlike fuels that are derived from petroleum. Apart from that, its production cost is lower. That is why, from an economic point of view, biodiesel is considered a diesel fuel substitute of superb quality.

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