The biofuels sector’s growing mainstream attraction may be a relatively recent phenomenon, but local company Blue Diesel’s involvement in the business can be traced back to well before the current debate over alternative fuels began.
The biofuels sector’s growing mainstream attraction may be a relatively recent phenomenon, but local company Blue Diesel’s involvement in the business can be traced back to well before the current debate over alternative fuels began.
Blue Diesel, a private pty ltd company, is the brainchild of founder and current director Andrew Wharton, who concluded after the 2001 Californian energy crisis that the world was likely to enter a period of rising oil prices.
Mr Wharton has worked in the oil industry since 1988 and began looking into alternative energy sources in the early 2000s, not sure of the best way forward.
He told WA Business News that he began seriously looking at biodiesel in his backyard in 2003, and through a process of ongoing experimen-tation developed an efficient process for the manufacture of biodiesel in March 2005.
“This coincided with the increase in the price of oil and we were able to attract some substantial investors to come on-board,” Mr Wharton said.
The Blue Diesel name was incorporated as a business in August.
Mike Burrows joined the company in December as a director, and is presiding over an exciting period for Blue Diesel as it gears up to commence production from its pilot plant at Welshpool.
The facility, which cost $500,000 to build, will produce about one million litres of biodiesel per year, with production due to start from the end of July.
Blue Diesel will use the pilot facility to test and refine its process before embarking on a commercial scale plant, which it hopes to have operational in 12 months’ time.
“The commercial plant will initially have an 18 million litre per year capacity for the production of biodiesel, and we will then look to expand it to 40 million litres a year,” Mr Burrows said.
Blue Diesel believes canola is the best quality feed stock for the manufacture of biodiesel and plans to use it in preference to other options, such as tallow and palm oil.
“Canola is about 14 cents a litre more expensive, because you can only extract about 40 per cent oil from the crop and there isn’t a great demand for the remaining feed from a canola crop,” Mr Burrows said.
“Also, there is ‘pour-point’ problems associated palm oil based-biodiesel, where the pouring consistency of the fuel becomes congested at cooler temperatures and it doesn’t flow through engines very well.”
Mr Burrows said Blue Diesel was focusing on a canola-based product as it gave the company a better opportunity to market its fuel directly to end users, like mining companies, instead of distributing via major oil companies, which use biodiesel in a blend with petroleum diesel.
“We hope the mining sector take it up in a big way and that we can sell it direct as the margins will be greater, but we may also have to sell to the oil companies,” he said.
Messrs Wharton and Burrows see a bright future for the biofuels industry and predict it will develop into a well-established business in WA as a complement to fossil fuels and other emerging energy sources.
“The price of oil is likely to remain high. Biodiesel will only ever replace a fraction of fossil fuel use, but it will be a valuable complement to other alternatives,” Mr Wharton said.