The Daily Tribune <<< Without Fear or Favor >>>

»HEADLINES

»NATION

100,000 has in Quezon set for jathropa farm

By Riza Recio

05/22/2008

The government is speeding up the development of 100,000 hectares of land in Quezon for the planting of jathropa, a feedstock for biofuel, as crude oil prices soar to dizzying heights.

State firm Philippine National Oil Co. biofuel unit PNOC-Alternative Fuels Corp. (PNOC-AFC) signed a tripartite agreement with the provincial government of Quezon and the LandBank of the Philippines (LBP) for an integrated jathropa development including nurseries, plantations, processing and refineries.

“The local government of Quezon has committed an initial area of 100,000 hectares of land to undergo development study under the agreement,” PNOC-AFC president Peter Anthony Abaya said.

The agreement binds also the Quezon province with the Landbank to identify growers, cooperatives, individuals, people’s organizations, small medium enterprises and corporations that will undertake the production of jatropha and related activities.

The financing fund through LBP will ensure PNOC-AFC’s establishment of additional processing plants and refineries, and will extend loans to growers based on the approved farm plan and budget subject to the bank’s existing credit policies and guidelines.

The accreditation of seedlings suppliers will be undertaken by the nurseries.

The PNOC-AFC will purchase in commercial quantities the seeds produced by growers at a guaranteed floor price subject to upward price adjustment as stipulated in the production, technical and marketing agreement with the growers.

PNOC-AFC said it will withhold and remit to LBP the portion of its payments to growers equivalent to the amount of the loan amortization.

The agreement was made to establish the formal working relationship of the three parties to synchronize and strengthen all existing efforts supporting the development of alternative and renewable energy sector in the country,” Abaya said.

On Aug. 15 last year, the provincial government of Quezon signed an agreement with PNOC-AFC for the promotion, production and processing of jatropha in the province.

Consequently, LBP signed an agreement with PNOC-AFC on Aug. 28 last year for the financing and marketing of jatropha.

Both agreements were in line with Republic Act 9367, otherwise known as the “Biofuels Act of 2006.”

Under this law, government financing institutions, including LBP, are mandated to accord high priority to extend financing to Filipino citizens and entities engaged in activities involving, among others, the production of biofuels.