DATA

1. Biofuel Production in the Philippines

Biodiesel Production

Select Biodiesel Plants to view and download operating plant data.

Biodiesel can be made from new or used vegetable oils and animal fats, which are
nontoxic, biodegradable, and renewable. Fats and oils are chemically reacted with an
alcohol (methanol is most commonly used in the United States) to produce chemical
compounds known as fatty acid methyl esters. Biodiesel is the name given to these
esters when they are intended for use as fuel. Glycerin (used in pharmaceuticals and
cosmetics, among other markets) is produced as a co-product.

Biodiesel can be produced using a variety of esterification technologies. The oils and
fats are filtered and preprocessed to remove water and contaminants. If free fatty
acids are present, they can be removed or transformed into biodiesel using special
pretreatment technologies. The pretreated oils and fats are then mixed with an
alcohol (usually methanol) and a catalyst (usually sodium hydroxide or potassium
hydroxide). The oil molecules (triglycerides) are broken apart and reformed into
methyl esters and glycerin, which are then separated from each other and purified.
Roughly speaking, 100 pounds of oil or fat are reacted with 10 pounds of a short-
chain alcohol (usually methanol) with a catalyst to form 100 pounds of biodiesel and
10 pounds of glycerin.

Schematic of biodiesel production path.

Although the process is relatively simple, homemade biodiesel is not recommended.
Diesel engines are expensive, and it is not worth risking damage or even minor
operational problems from fuel that does not meet rigorous ASTM D6751
specifications. Section 3.1 of the Biodiesel Handling and Use Guidelines provides a
summary of this standard. The full standard can be purchased from ASTM
International.

Do not use raw vegetable oil in a diesel engine. Fats and oils (triglycerides) are much
more viscous than biodiesel, and low-level vegetable oil blends can cause long-term
engine deposits, ring sticking, lube oil gelling, and other maintenance problems that
can reduce engine life.

Much of the original biodiesel production capacity comes from companies already
making products from vegetable oil or animal fat in the detergent industry among
others. More than half the biodiesel industry can use any fat or oil feedstock,
including recycled cooking grease. The other half of the industry is limited to
vegetable oils; soy oil is the most common source in the United States today. The
soy industry has been the driving force behind biodiesel commercialization because
of excess production capacity, product surpluses, and declining prices. Similar issues
apply to the recycled grease and animal fats industry, even though these feedstocks
are less expensive than soy oils. A possibly limiting factor for biodiesel industry
growth is potential saturation of the market for glycerin.

Enough virgin soy oil, recycled restaurant grease, and other feedstocks are readily
available in the United States to provide feedstock for about 1.7 billion gallons of
biodiesel per year (under policies designed to encourage biodiesel use). This
represents roughly 5% of on-road diesel used in the United States.

http://www.afdc.energy.gov/afdc/fuels/biodiesel_production.html

APEC biofuels in the Philippines

• The Philippines Biofuels Activities
Background
The Philippines embraced the development of biofuels a few years ago with hopes of
achieving future energy security, augmenting farmers' income, and generating rural
employment. The member economy also hopes to position itself as a leading biofuels
producer in the region. The main challenge facing the industry is the availability of
feedstock and the processing facilities to meet the demand of the government's
National Biofuels Program.

Production
Biofuels production in the Philippines is currently limited to just biodiesel. The
member economy had seven biodiesel production plants as of August 2007, with a
total output of 257 million liters a year. This production capacity exceeds the
requirement of the mandatory volumes set by the Biofuels Act, thus the biodiesel
producers see it as an excellent export opportunity.

Production of fuel ethanol will commence in late 2008, in time for its mandated use
in 2009. Several ethanol plants are under construction, but their scheduled
completion, inclusive of their corresponding feedstock supply-base, is uncertain
(USDA 2007).

Feedstock
Primary feedstock for biodiesel production in the Philippines is coconut oil. The
Philippines is one of the largest producers of coconut oil in the world - approximately
1,400 million liters per year. Nearly 20% (400 million liters) of this production is
used for domestic consumption, and the balance of 80% is exported. Mindanao
accounts for almost 60% of the economy's total coconut oil production (Embassy of
the Republic of the Philippines 2007). Potential biodiesel feedstocks in the Philippines
are jatropha and palm oil. The government has announced its plan to launch massive
propagation and cultivation of jatropha seeds covering around 2 million hectares (ha)
of unproductive and idle public and private lands nationwide. This effort will produce
about 5,600 million liters of biofuel in the next 10 to 12 years (Bulatlat 2007). There
are few pilot plantations growing oil palm.

In the Philippines, sugarcane is considered a primary source for ethanol production.

The government sees it as the most reliable feedstock due to its well-established
farming technologies and the highest yield per hectare compared to other feedstock
(corn, cassava, and sweet sorghum). Sugarcane production in the Philippines is
expected to increase to meet the requirements of the Biofuels Act. At present, the
sugar industry can only supply 79% of the needs of the 5% ethanol blend, which is
between 200 and 400 million litres per year. The Philippines, therefore, needs to
expand its current 167,300 sugarcane farms covering a total area of 344,700
hectares to meet the ethanol demand. The Sugar Regulatory Administration (SRA)
already identified 237,748 hectares of new sugar fields, mostly in Mindanao, that can
be tapped to produce fuel ethanol (Bulatlat 2007). Additional ethanol feedstocks
considered by the government are sweet sorghum and cassava.

Infrastructure and Vehicles

B1 is available through all service stations in the Philippines, and it has been
successfully used by thousands of vehicles in the Philippines since 2002. E10 is
currently offered by all Seaoil stations nationwide. It is expected that in 2008 more
gas stations will be offering E10 (Biofuels Philippines 2007).

In 2007, Ford Philippines opened a plant that manufactures flexible fuel engines in
Santa Rosa, Laguna. These engines are designed to run on a mix of up to 20%
ethanol. Production output of the Ford facility reportedly is estimated at 105,000 FFV
engines in the next five years, with some units intended for export to South Africa
and other Association of Southeast Asian Nations (ASEAN) countries. The Ford
plant's opening is expected to enhance and accelerate the adoption of biofuels in the
economy (USDA 2007).

Trade
Chemrez Inc. has exported 500,000 liters of coconut-based biodiesel to Germany
and to Asian markets including China, Chinese Taipei, South Korea, and Malaysia. If
the mandated biodiesel blend increases to 2% in the next two years, as specified in
the Biofuels Act, biodiesel companies in the Philippines may concentrate on supplying
the domestic market and export only excess volumes.

http://www.biofuels.apec.org/me_philippines.html
 *Copyright APEC 2008. All Rights Reserved. For Web site inquiries,
contact the webmaster. This site is hosted and maintained by the National
Renewable Energy Laboratory (NREL).

• Biodisel Plant
17 January 2007- Energy Secretary Raphael Lotilla today welcomed Bioenergy 8
Corporation’s announcement to build a new biodiesel plant in Sasa, Davao, highlighting
that this is the first biodiesel production facility sited in Mindanao and is therefore
expected to enhance access to biodiesel supply and boost agricultural productivity in the
region.

The biodiesel plant is jointly owned by independent oil players Flying V, Eastern
Petroleum, Seaoil Philippines and Unioil. The total investment of about P50 million will
initially produce 30 million liters of coco-biodiesel annually. Its annual production is
expandable to 90 million liters.

Secretary Lotilla expressed optimism that with four biodiesel producers already
onstream and several others undergoing accreditation with the DOE, including the new
Biodiesel 6 plant, issues on monopoly of biodiesel supply will continue to be addressed
as private investments respond to the mandate provided by the recently signed Biofuels
Act.

DOE is especially optimistic about the Bioenergy 8’s facility being located in
Mindanao
expecting that production will serve Southern Philippines. The Secretary said that
Bioenergy 8 investment ensures geographical distribution of blended biodiesel at reduced
costs for Mindanao consumers.

The Biofuels Act mandates a nationwide minimum 1 % biodiesel blend in all

diesel-fed engines within three months from the effectivity of the Act.

The Philippines is one of the largest producers of coconut oil. The country’s
coconut oil production is approximately 1.4 billion liters per year. Twenty percent or 400
million liters of this is used for domestic consumption while the balance of 80 percent is
exported. Mindanao accounts for almost 60 percent of the country’s total coconut oil
production.

Biodiesel production capacity within the Philippines exceeds the requirement of

the mandatory volumes from the Biofuels Act and biodiesel producers have been eyeing
the growing market for clean fuels overseas.

So far, the country’s biggest coco-biodiesel plant is owned by by Chemrez

Technology Inc. which has 60,000,000 liters annual capacity. Senbel Fine Chemicals Inc
has a total annual capacity of 36,000,000 liters, Romtron Philippines located in
Odiongan, Romblon has 300,000 liters annual capacity while Mt. Holy Coco has
4,000,000 liters annual capacity.
 “This new biodiesel plant is a welcome development in our quest to attain energy
security and self sufficiency for the country through the utilization of locally produced
biofuels,” the Secretary stressed. He added that as anticipated, mandated market for
locally produced biofuels will jumpstart biofuels production in the country and eventually
allow the Philippines to even supply regional and global markets.

Chemrez has earlier announced that they are planning to export their biodiesel in
Japan and Germany while Bioenergy 8 Corporation is already talking with a Japanese
firm.
http://www.philippine-embassy.de/bln/index.php?
option=com_content&task=view&id=266&Itemid=74
*Written by Webmaster
Friday, 19 January 2007
(Embassy of the Republic of the Philippines, Berlin, Federal Republic of Germany) ©
2006 Embassy of the Republic of the Philippines
Uhlandstrasse 97, 10715 Berlin, Germany | Tel. +49 (30) 86 49 500 | Fax +49 (30) 87 32 551 | E-
Mail: [email protected]

food vs. fuel? Biofuel production in the Philippines

I've heard environmentalists battle it out pretty violently over biofuel. While I'm happy
to say that there have not been any heads ripped off just yet, surely some form of
explanation on the "hot issue" is enough to get your mind running.

Global food production must increase 50% by 2030, according to the UN Secretary
General. At the same time, the FAO warns that increase in global temperatures can cause
crop yields around the world to decrease by as high as 35%.

Meanwhile, organizations like Oxfam (and the usually conservative IMF!) are
giving us a picture on the impact of biofuels on the world. Global food costs are pushed
up by 30%. Biofuel policies in OECD countries have already pushed 30 million people
into poverty.

While we are left data-less again in the Philippines (it's not there, or we can't find
it), we can pretty much guess the possible impact on us. We know that oil prices are
skyrocketing, and in return, food prices (which include transport costs, along with
expenses for chemical fertilizer and pesticide, which are mostly petroleum-based) are
becoming pretty exorbitant.
The Philippines has one of the lowest levels of agricultural productivity in
Southeast Asia, and we've been importing rice since the 1800's. Even without biofuels,
our food systems have already been under stress. On the other hand, efficient and cheap
transport is essentially linked to distribution and spoilage issues. Because food is either
imported or grown outside city centers, we are affected by every gas price hike.

So what impact will biofuels have on this? Sure, we won't be subject to rising oil
prices. But as our population swells, and we'll need more and more land to grow food.
This means less land for fuel plants. Will we end up suffering from the same kind of
"price squeeze" that we are experiencing with oil? What if we end up importing biofuels
from mega-producers such as Brazil?

And it's not just food consumption that grows with population-- as we continue to
make poorly designed cities and ignore the potentials that high population has for
effective public transportation, fuel consumption for mobility's sake will continue to
increase.

To meet these needs without relying too much on the volatile oil market, our
government plans to attain 60% energy self-sufficiency by 2010. They are doing this by
encouraging biofuel production mostly from sugarcane and jatropha. Each potential crop
has its own issues to contend with.

For instance, jatropha needs a lot of land and water to produce a financially viable
amount of oil. And like food crops, anything planted in large monocultures will require a
lot of resources-- energy, chemicals, water-- and will ultimately be environmentally
destructive.

Personally, I feel that biofuels may have their use in replacing fossil fuels. We
need to exlore if small-scale production of biofuels may be harmonized with local food
production and processing. Otherwise, the large biofuel monster replace the large
petroleum monster. The only justifiable place that biofuel can hold for me is in small-
scale production for more varied energy uses.

However, there are far more pressing questions that have to do with how we get
around, and how we plan our cities.

Should we keep planning our cities with cars in mind, or should we start making
walkable, mixed-use areas that allow people to choose not to live with cars? Should we
develop local economies and stop farmers and producers from surviving only be
exporting to far-flung centers? Should we invest in making more fuel to power the
growing number of cars, or create better public transport to decrease the purchase and use
of cars?

One can almost imagine a "clean and green city" with millions of cars running on
biofuel. The invisible part is that, somewhere else, land for food production is shrinking
every year to accommodate increasing production of "clean fuel". Things are not so
simple. Renewable does not necessarily mean sustainable.
http://suspinoy.blogspot.com/2008/07/food-vs-fuel-biofuel-production-in.html
*Sustainable Pinoy, WEDNESDAY, JULY 2, 2008

Fuel for thought

By Massie Santos Ballon
Inquirer
First Posted 03:45:00 08/18/2007
Filed Under: Alternative energy

MANILA, Philippines -- Wheat can fuel cars, not just people. In the Aug. 3 issue of the
journal Biotechnology Progress, chemical engineer Apostolis Koutinas and his colleagues
at the University of Manchester in England describe a relatively energy-efficient process
to convert wheat into bioethanol. With help from researchers at Koutinas’ alma mater, the
University of Patras in Greece, the scientists hope that this new technique will help
increase biofuel production in Europe, where more wheat than corn is grown.

One major drawback to using crops such as wheat and corn as sources of biofuels,
however, is that they weren’t designed to feed cars. (For those of you looking for it, rice
isn’t on the list of good biofuel sources. Worry instead about what could happen if rice
farmers someday decide that biofuel crops are more profitable to grow and switch over.)
Wheat and corn have been bred to be high-yield sources of food for both people and
livestock. Using such food crops as fuel crops not only raises questions about who to feed
-- people or vehicles? -- but also how much it costs to turn these grains into gas.

3 major steps

The process of converting plants into biofuels involves three major steps, each of which
has obstacles that hinder cost-effective production. (It’s been argued that people are more
likely to consider the environment-friendly option if it becomes budget-friendly to be
green.) First the plants have to be processed into biomass. Then the biomass has to be
converted into sugar. Finally the sugar must be fermented to become biofuels such as
methanol and ethanol. Processing biofuels is like cooking vegetables; raw vegetables
have more nutrients (and more flavor) than those cooked for a long period of time.
Similarly, much energy goes into making biofuels but the current yields aren't very
impressive.

Koutinas and his colleagues say their method produces a kilogram of glucose sugar from
wheat for approximately US$0.13. The process of turning the glucose into ethanol
doesn’t raise the cost very much more since the fermentation process uses baker’s yeast.
As a means of comparison, US$0.13 is about P6 by current conversion rates, and is
roughly what Meralco charges per kilowatt hour.

Biofuel production

In the Philippines, the food issue is avoided by using the jatropha (tuba-tuba) plant. The
Biofuels Act of 2006 and implementation of the 1 percent biodiesel: 99 percent diesel
gasoline ratio has led to biofuel production from jatropha and coconut, among other
plants. Republic Act 9367 even calls for the National Biofuel Board to determine if
biofuel production is sufficient to recommend that bioethanol compose at least 10 percent
of all the gasoline (not limited to just diesel this time) sold in the country by 2011.

Three years could be enough time to increase biofuel production in the Philippines to
make the 10 percent bioethanol recommendation possible. The amount of land needed to
do so bears consideration though. A recent paper from Jesse Ausubel, the director of the
Program for the Human Environment at New York's Rockefeller University, argued that
planting enough crops to use as biofuels the world over isn't very eco-friendly. (Ausubel
also argues that the renewable energy sources aren’t actually “green” and that nuclear
energy is, but that’s a topic for another time.)

So much land would be required, he says, that more of the environment would be
disturbed, as parks and forests give way to biofuel crop farms. The wheat to gas
technique Koutinas et al. propose could be of use in Europe, but it still raises questions
about who, or what, the farms should be feeding. This biofuels issue is, if you’ll forgive
the expression, food for thought.

http://showbizandstyle.inquirer.net/lifestyle/lifestyle/view/20070818-
83319/Fuel_for_thought

*© Copyright 2001-2011 INQUIRER.net, An INQUIRER Company(Inquirer.net)

2. Environmental Degradation in the Philippines

Rural poverty and environmental degradation in the Philippines: A system
dynamics approach
Poverty among the small cultivators in the Philippines remains widespread
despite a general increase in per capita income during the last three decades. At
the same time, the degradation of agricultural land resources, as sources of daily
subsistence for the rural workers, is progressing. Past policy studies on the
alleviation of rural poverty in the developing countries have centered on the issue
of increasing food production and expanding economic growth but gave little
attention to the issue of constraints imposed by degradation of agricultural land
resources. Only in recent years have there been increasing focus on the
relationship between rural poverty and environmental degradation. Inquiry is,
however, often done by simplistic one way causal relationships which, although
often illuminating, does not provide a comprehensive understanding of the
different interacting processes that create rural poverty and land degradation.
Thus, policies ensuing from such analyses provide only short-term gains without
effecting lasting improvement in the living conditions of the small cultivators.
This dissertation examines the complex interrelationships between rural poverty
and land degradation and attempts to explain the inefficacy of broad development
programs implemented in alleviating rural poverty and reversing deterioration of
land resources. The study uses the case of the Philippines for empirical validation.
The analysis employs computer simulation experiments with a system dynamics
model of a developing economy consisting of an agricultural sector whose
microstructure incorporates processes influencing: agricultural production;
disbursement of income; changes in the quality of agricultural land resources;
demographic behavior; and rural-urban transfer of real and monetary resources.
The system dynamics model used in this study extends the wage and income
distribution model of Saeed (1988) by adding to it decision structures concerning
changes in the quality of agricultural land resources and rural-urban interaction.
 The study concludes that development programs advancing growth in agricultural
production and providing technological, organizational, and financial assistance to
target poor groups would not deliver long-term improvement in the economic
conditions of the poor peasants unless distribution of land is altered. Similarly,
policies promoting land improvement and conservation measures in an economic
environment where land ownership remains skewed do not produce lasting
betterment of agricultural land quality. It has been shown that a policy, which
discourages the separation of land ownership from cultivatorship by imposing a
tax on income accrued from absentee ownership, is therefore very critical in
promoting land ownership among small cultivators and changing unequal land
and income distribution. However, in order to sustain the improvement in the
economic and environmental conditions of the small cultivators, this policy of
taxing rent income must be complemented by policies that: (1) promote increases
in agricultural production; (2) provide technological, organizational, and financial
assistance to the small farmers; and (3) promote land improvement measures.
*Phares Penuliar Parayno, "Rural poverty and environmental degradation in the
Philippines: A system dynamics approach" (January 1, 1997). Dissertations available from
ProQuest. Paper AAI9727272.
http://repository.upenn.edu/dissertations/AAI9727272

Effects of Environmental Degradation:

One of the greatest challenges facing humanity is environmental degradation,

including deforestation, desertification, pollution, and climate change – an issue
of increasing concern for the international community. Environmental
degradation increases the vulnerability of the societies it affects and contributes to
the scarcity of resources.

Climate change will lead to an increase in the intensity and frequency of weather
extremes, such as heat waves, floods, droughts and tropical cyclones. The people
hardest hit by climate change and environmental degradation are those living in
the most vulnerable areas, including coastal communities, small island nations,
Sub-Saharan Africa and Asian delta regions. It is the poorest of the poor, who
lack the resources to prepare, adapt and rebuild, that are most affected.

Environmental degradation can lead to a scarcity of resources, such as water and

farmable.

Extreme weather events, such as severe flooding, increase the spread of

waterborne diseases, such as malaria and diarrhoea.

The effects of the major environmental problems on both health and productivity
are:

a. Water pollution and water scarcity: As per the estimation of UN, more than
two million deaths and billions of illnesses a year are attributable to water
pollution. Water scarcity compounds these health problems. Productivity is
affected by the costs of providing safe water, by constraints on economic activity
caused by water shortages, and by the adverse effects of water pollution and
shortages on other environmental resources such as, declining fisheries and
acquifer depletion leading to irreversible compaction.

b. Air pollution: As per the estimation of UN, urban air pollution is responsible
for 300,000—700,000 deaths annually and creates chronic health problems for
many more people. Restrictions on vehicles and industrial activity during critical
periods affect productivity, as does the effect of acid rain on forests and water
bodies.

c. Solid and hazardous wastes: Diseases are spread by uncollected garbage and
blocked drains; the health risks from hazardous wastes are typically more
localized, but often acute. Wastes affect productivity through the pollution of
groundwater resources.

d. Soil degradation: Depleted soils increase the risks of malnutrition for farmers.
Productivity losses on tropical soils are estimated to be in the range of 0.5-1.5 per
cent of GNP, while secondary productivity losses are due to siltation of reservoirs,
transportation channels and other hydrologic investments.

e. Deforestation: Death and disease can result from the localized flooding caused
by deforestation. Loss of sustainable logging potential and of erosion prevention,
watershed stability and carbon sequestration provided by forests are among the
productivity impacts of deforestation.

f. Loss of biodiversity: The extinction of plant and animal species will

potentially affect the development of new drugs; it will reduce ecosystem
adaptability and lead to the loss of genetic resources.

g. Atmospheric changes: Ozone depletion is responsible for perhaps 300,000

additional cases of skin cancer a year and 1.7 million cases of cataracts. Global
warming may lead to increase in the risk of climatic natural disasters. Productivity
impacts may include sea-rise damage to coastal investments, regional changes in
agricultural productivity and disruption of the marine food chain.

Conclusion: The impact of environmental disasters can be devastating on the

social, economic, and environmental systems of a country or region as well as the
global ecosystem. Environmental disasters do not recognise man-made borders,
and threaten the legacy left to future generations of a clean and supportive
environment. Because of the interdependency of earth ecosystems international
co-operation is paramount to prevent, and when disaster strikes, respond to relieve
quickly and effectively the effects of environmental disasters. Thus,
Governments, International organizations and communities must work together –
at all levels – to lessen the risks associated with environmental degradation and its
 contributing factors, such as climate change, and ensure that vulnerable people are
prepared to survive and adapt. At the same time, companies, organizations and
individuals must also ensure that their work is environmentally friendly and
sustainable.

http://saferenvironment.wordpress.com/2008/08/18/effects-of-
environmental-degradation/
*Posted by: saferenvironment | August 18, 2008 (Partha Das Sharma’s
Weblog “keeping world Environment Safer and Greaaner”.

• CAUSES OF ENVIRONMENTAL DEGRADATION

Like other parts of Ecuador's rural economy (Scobie "et al." 1990), the shrimp
industry feels the impacts of governmental interference with market forces.
Exports are subject to a 1% tax. Also, imports of high-quality feed have been
restricted at times (Rosenberry 1990).

Over-valuation of the Ecuadorian sucre can discourage production and

impinge on industry earnings. However, the main effect is to encourage
smuggling. In 1984, when the official exchange rate was only 80% of the market
rate, a fifth of the national shrimp harvest was shipped illicitly to Peru, where it
was in turn sent to the United States and other countries (LiPuma and Meltzoff
1985, 20).

Since smuggling is relatively easy, the impacts of currency distortions on

shrimp industry performance are not all that great. Two other elements of the
policy environment have a much stronger influence on maricultural enterprises'
use and management of coastal resources. The first is property arrangements.
The second element is inadequate investment in the shrimp industry's scientific
base.

Inappropriate Property Arrangements

Depletive management of Ecuador's coastal ecosystems has much to do with the

legal standing of resources. By law, coastal beaches, salt-water marshes, and
everything else below the high tide line is a national patrimony. But for all
intents and purposes, access to most of that land is completely free. For
example, no public agency attempts to keep an accurate count of PL collectors
in different parts of the country. Never, it seems, have there been any
serious proposals to subject that group's activities to legal control.

Permanent settlement in coastal wetlands is also unregulated. For example, a

community of crab fishers has established itself, without any sort of
governmental approval or interference, in the Churute Ecological Reserve, a
mangrove swamp 40 KM south of Guayaquil. Similarly, expansion of the port
city's slums into adjacent wetlands is totally uncontrolled.

There is some regulation of shrimp pond construction along the shore.

Specifically, a 10-year use permit must be obtained from the General Merchant
Marine Directorate. Depending on the pond's location, approvals might be
needed from the Ministry of Agriculture and Livestock, the Ecuadorian Institute
of Agrarian Reform, and other public agencies. Annual fees charged permit
holders amount to 11% of the minimum monthly wage for each hectare.
Generally, this works out to less than $10/ha./year.

Some individuals have been able to construct ponds without permits and, once
operations have begun, to claim that the site was above the high tide line (and
therefore not subject to public control). Others have found it useful to take
on a government official as a partner. The advantage of this is that the many
months normally spent waiting for a permit to be approved can be avoided.
Another option is to offer bribes, which are reported to have reached $100/ha.
(LiPuma and Meltzoff 1985, 9).

The tenurial roots of coastal ecosystem degradation can be described as a

mixture of a tragedy of the commons (Hardin 1968) and rent capture. Excessive
collection along beaches, in mangrove swamps, and in other habitats, like over-
fishing in the ocean, is a clear example of over-exploitation of an open access
resource. Fishers know that they can capture the benefits of extra fishing
effort (in the form of payments for their catch). By contrast, the costs
associated with decreased breeding populations and other forms of fishery
depletion are shared by all who make their living, directly or indirectly, from
coastal ecosystems.

Water pollution from shrimp ponds and other sources is, likewise, a tragedy of
the commons. The benefits of releasing saline water rich in nutrients into
public waterways are internalized by the individual operator (in the form of
avoided treatment costs) while the costs of emissions (associated with damage
to ecosystems) are an externality.

Habitat destruction involves negative externalities as well. However, the

conversion of wetlands and other coastal ecosystems is also an example of rent
capture. A rudimentary analysis shows that the net revenues generated by a
shrimp pond far exceed the costs associated with obtaining use permits. For a
semi-intensive operation yielding only 1.80 MT/ha./year, average costs are a
little less than $4,000/ha./year (LiPuma and Meltzoff 1985, 17). With shrimp
prices currently exceeding $4,000/MT, annual net returns are more than
$3,000/ha. Clearly, a significant portion of coastal ecosystem destruction is
motivated by individuals' desire to capture that income stream in exchange for
an initial payment of $100/ha. followed by annual fees of less than $10/ha.
Inadequate Investment in Human Capital and Scientific Base

The property arrangements contributing to the conversion of coastal ecosystems

into shrimp ponds are similar to those that accelerate agricultural
colonization of natural ecosystems elsewhere. There is another parallel
between mariculture's geographic expansion and agriculture's, which is that
both are a consequence of inadequate investment in human capital, research, and
extension.

The history of the Ecuadorian shrimp industry is a classic illustration of

Hayami and Ruttan's (1985) thesis that geographic expansion usually precedes
productivity-enhancing investment in agriculture and other parts of the rural
economy. The first shrimp ponds, in which extensive technology was employed,
were built close to shore. Dikes by the sea could be opened to let in clean
seawater and the PL and nutrients it contains. Yields were minimal. But costs
were also low, neither supplementary stocking nor fertilization nor feeding
being required.

As the sites best suited to extensive mariculture have been occupied,

production technology has changed. Ponds located farther from and a little
above the ocean have to be stocked and fertilized artificially. As noted
earlier in this paper, this makes mechanized exchange of pond water for sea
water necessary. The transition to semi-extensive technology has also been
accelerated by subsidization of the diesel fuel used to operate pumps. If
Ecuadorian energy prices were to rise to international levels, expenditures on
diesel fuel would no longer account for 12% of the operating costs of a semi-
extensive maricultural enterprise (LiPuma and Meltzoff 1985, 17). Instead,
diesel prices would be at least three times higher and fuel expenditures would
amount to more than a quarter of those costs.

Although spending on pumps and other machinery can be considerable,

management
of many semi-extensive operations is still rudimentary. Stocking,
fertilization, and application of antibiotics (to combat disease) are usually
haphazard. In addition, many enterprises do not employ competent biologists or
maintain records that would, over time, allow them to achieve efficient mixes
of inputs and outputs.

In recent years, semi-intensive technology has begun to be adopted. Ponds are

being designed and operated so as to achieve efficient water exchange and
aeration. The number of biologists employed to manage PL stocking and
application of feed and nutrients is also increasing. In addition, stocking
 densities in semi-intensive ponds are higher, as are yields.

Further improvement in shrimp production technology can be expected in

Ecuador,
with more enterprises undertaking the careful management that characterizes a
semi-intensive operation. Aside from firms located close to Guayaquil, the
industry's access to laboratories where water quality can be tested and where
shrimp diseases can be assessed remains minimal. Accordingly, there are
opportunities to achieve more precision in the application of fertilizers,
feed, and antibiotics and also in water exchange.

Additional spending on research would also ease Ecuadorian mariculture's

dependence on PL captured in the wild. In particular, more widespread
understanding of the factors influencing shrimp reproduction ("i.e.",
temperature, water chemistry, and above all, nutrition) would allow more
hatcheries to become self-contained. That is, those facilities would be able
to breed PL from mature adults instead of merely extracting eggs from gravid
females. Once this is done, the problem of excessive PL collection will be
solved.

http://epat.wisc.edu/.res-price/.shrimp/.format/.causes.html
*Converted from gopher on 8/6/1999

3. Farms Converted to biofuel production

Food, Fuels and our Futures: A Critique on the

Philippines’ Biofuel Guidelines

Posted by Jae on April 13, 2009

* Something I wrote recently that I feel very strongly about. Wala pa kaming org website, so I’m

putting it here in the hope that it comes up when anyone does a google-search for biofuel policies in

the Philippines. It’s long and boring, and if you don’t want to read it, you won’t hurt my feelings.

Joint Administrative Order No. 2008-1, Series of 2008 – or the Guidelines Governing the Biofuel

Feedstocks Production and Biofuels and Biofuel Blends Production, Distribution and Sale under RA

9367 — could not have come at a worse time. It became effective on March 20, 2009 without much

fanfare and escaping the public scrutiny that usually attends laws and administrative orders of a

controversial nature.
In essence, JAO 2008-1 outlines the process to be followed by landowners who wish to use their

agricultural lands as biofuel production sites. It enumerates the requirements needed before a

certification is issued to biofuel producers and biofuel feedstock producers, and sets the parameters

to be followed in biofuel production, distribution and sale.

The Administrative Order was jointly signed by the Departments of Energy, Agrarian Reform,

Agriculture, Environment and Natural Resources, Finance, Labor and Employment, Science and

Technology, Trade and Industry, Transportation and Communication, the National Commission on

Indigenous Peoples, the Philippine Coconut Authority, the Sugar Regulatory Administration and the

National Biofuels Board.

Amidst the backdrop of massive food insecurity being faced by the entire nation, the current

precarious state of the agrarian reform program and the widespread dislocation of farmers and farm

workers all over the country, the Center for Agrarian Reform Empowerment and Transformation,

Inc. (CARET, Inc.) and the Rural Poor Institute for Land and Human Rights, Inc. (RIGHTS, Inc.)

believe that the wisdom of JAO No. 2008-1 needs to be rethought.

Land for food: Shifting priorities and muddling the rules on land use conversion

The rhetoric of agrarian reform is often rife with invocations of social justice and peasant rights, for

indeed at the heart of any land redistribution program is the desire to improve the situation of

landless farmers all over the country and eradicate rural poverty. However, agrarian reform also

operates as an insurance policy over agricultural lands and works to ensure that these lands would

continue to be a source of food for the population.

As it stands, many experts have already spoken of the negative impact of biofuel production on food

security in cases wherein biofuels and food may both be the end-use of the same crop. Future

increases in the world prices of food have been speculated to result from the boom in biofuel

production (IFPRI, 2006). In countries like the Philippines that do not enjoy a large land size, the

threat to food security is less speculative and more certain.

One of the objectives of JAO 2008-1 is “to ensure that lands devoted to food crops shall not be

utilized for biofuel feedstocks production except in cases provided therein.” A more careful perusal

of the specific provisions of the Guidelines, however, demonstrates how this particular objective is

not only ignored, it is also being flouted.

First, JAO 2008-1 expands the coverage of lands that may be converted to bio-fuel production from

its original use as a source of food crops.

The Rules on Land Conversion[1] sets as non-negotiable for conversion all agricultural lands with

irrigation facilities. This means that for as long as the land in question is agricultural in nature and

has facilities for irrigation, its use should remain devoted to the planting of crops and may not be

converted to any other use. However, Section 4.1D of JAO 2008-1 does not include this exemption

in its list of agricultural areas that shall not be utilized for biofuel feedstock production, and exempts

practically only those lands where the irrigation facilities are government-funded, covered by

irrigation projects with firm funding commitments and are utilized for rice and corn. Effectively,

agricultural lands with irrigation facilities that do not fall under any of the categories mentioned

above are fair game for bio-fuel production.

Moreover, the Land Conversion Rules contains an entire category of lands highly-restricted from

conversion such as lands with the potential of growing semi-temperate or high value crops, and

irrigable lands not covered by irrigation projects with firm funding commitment. This category of

highly-restricted lands is eliminated completely from JAO 2008-1.

Not content with expanding the scope of coverage of lands that may be converted, JAO 2008-1

exempts from DA certification landowners whose “effective area is twenty five (25) hectares or

less.” This means that all landowners with 25 hectares or less can arbitrarily and unilaterally decide

to convert his landholding to a biofuel production site. The DAR estimates that 1.3 hectares of land

are undistributed. If these hectares of lands are made up of landholdings bigger than the retention

limit of five hectares but less than 25 hectares, then they may immediately be converted into

biofuel sites, no questions asked and no certification process required.

Second, JAO 2008-1 makes it easier to convert the lands to biofuel sites and expedites the process

of acquiring a certification. Under the Joint Administrative Order, in Section 2.3, applicants for

biofuel feedstock production are required to submit to the DAR certain documents and information

required for conversion, such as performance bond, feasibility study, joint venture agreements,

affidavit of undertaking, etc. Curiously, however, a certification for the DAR is not required before

an Applicant is allowed to engage in the production of biofuel feedstock. According to Chapter II

Section 1 of the JAO 2008-1, the only requirements are an Environmental Compliance Certificate

(ECC), Certification Precondition issued by the NCIP and Certification issued by the DA. The non-

inclusion of the DAR Certification leads one to the conclusion that even absent that requirement, an

applicant may be granted a biofuel feedstock production permit.

By relaxing the rules on land conversion, agricultural lands are rendered vulnerable to the onslaught

of biofuel production. Because biofuel production is more lucrative than traditional food crop
production, and the government has made it easier for landowners to convert their lands to biofuel

production sites, there is little incentive to continue using the land for food.

Even before JAO 2008-1, the unabated conversion of lands is already taking its toll on our food

resources. As of December 2007, the DAR has approved 48,893.73 hectares of land for conversion

from agricultural to residential, commercial and industrial uses. Residential purposes take up the

bigger piece of the pie, with 37.5% of agricultural land converted to housing projects. 15.11% or

7,388.36 hectares out of 48,893.73 hectares of land were converted for industrial purposes, and

1.2% or 590.33 hectares out of 48,893.73 hectares of land were converted for commercial

purposes.

However, anecdotal evidence gathered on the ground reveals that more than 200,000 hectares of

land have been subjected to illegal conversions[2] – tying the hands of tenants and farmer

beneficiaries and preventing further agricultural production.

Vested Rights v. Vested Interests: Locating Peasant Rights within the Biofuel Boom

Simply stated, JAO 2008-1 appears to completely disregard the possibility – nay, the certainty –

that there are farmers cultivating the agricultural lands eyed as biofuel production sites.

Under the Rules on Conversion, many safeguards are in place to protect the rights of tenants and

farmers in the area, and ensure that conversion is not used as a mechanism to circumvent the

agrarian reform program. For example, applicants are required to accomplish an affidavit stating

the “number and names of the farmers, agricultural lessees, share tenants, farmworkers, actual

tillers and/or occupants” in the landholding, and should prove that they have paid disturbance

compensation to the farmers about to be dislocated.

No such requirements are in the JAO 2008-1. It makes no mention of the safeguards to be afforded

them, or the protections to which they are entitled. Admittedly, JAO 2008-1 adopts “in all aspect

not inconsistent therewith” DAR AO 1 Series of 2002; however, as long as compliance with the

latter is not made a requirement in the application for biofuel feedstock producer, then the rights of

the farmers in the area remain precarious and vulnerable. It may also be noted that while a Land

Use Conversion Certificate is required before the Department of Energy issues aCertification of

Registration with Notice to Proceed, such DOE certification is ALSO not a precondition to be a

Biofuels Livestock Producer.

For undistributed lands

JAO 2008-1 fails to take into consideration lands that are already in the process of acquisition. If for

example, a particular landholding has been issued a Notice of Coverage, will the process of

acquisition be halted in the event that the landowner applies to be Biofuels Livestock Producer? In

the Rules on Conversion, it is interesting to note that “lands issued with notice of valuation and

acquisition, or subject of a perfected agreement between the landowner and the beneficiaries under

the Voluntary Land Transfer (VLT)/ Direct Payment Scheme (DPS) under the CARP” are considered

Areas Highly Restricted from Conversion. This provision is not to be found anywhere in JAO 2008-1.

If the lands are tenanted, lawful tenants enjoy the right to cultivate the landholdings without fear

of dispossession. This is so even assuming that the landowner of a parcel of agricultural land leases

out his land to a biofuel producer or enters into a joint venture agreement for purposes of biofuel

production. Assuming it is a lease contract, the Supreme Court has ruled that the rights of the

farmers to the lands supersedes the terms of the lease, if such rights were in place upon the

perfection of the contract.

“… in case of transfer or in case of lease, as in the instant case, the tenancy relationship between

the landowner and his tenant should be preserved in order to insure the well-being of the tenant or

protect him from being unjustly dispossessed by the transferee or purchaser of the land; in other

words, the purpose of the law in question is to maintain the tenants in the peaceful possession and

cultivation of the land or afford them protection against unjustified dismissal from their

holdings. (Primero v. CAR, 101 Phil. 675);” (Coconut Cooperatives Marketing Association v.

CA. G.R. Nos. L-46281-83 August 19, 1988)

Even assuming it is not a lease contract, but a different kind of arrangement altogether, the right

of tenants not to be dispossessed should be guaranteed. Unfortunately, no such guarantee is made

explicit in the terms of the JAO 2008-1. Given that virtually any excuse is taken to circumvent the

provision of the CARL and given that we have an administration that inevitably takes the side of

industrial development, seemingly at any cost, no less than a guarantee in the Administrative Order

restating the government’s commitment to honor the farmers’ tenurial interests should be in place –

notwithstanding the basic rule that the laws of the land should be read into each and every policy

directive entered into and coming into force in this jurisdiction.

For distributed lands

As biofuel production sites require a land area larger than the standard farmlot size prescribed

under CARP, it is highly improbable that holders of Certificates of Land Ownership Awards (CLOA)

would be biofuel feedstock producers on their own. More likely is the possibility that the new biofuel
administrative order will encourage the facilitation of contractual arrangements and joint ventures

with agrarian reform beneficiaries – thus surfacing the very same objections that agrarian reform

advocates have against corporate farming and leaseback schemes.

Because of the disincentives on agricultural production and the dismal lack of support services,

farmers are often forced to enter into one-sided leaseback arrangements with corporations that may

or may not be the original landowner wherein effective management and control of the landholding

is ceded to the latter in exchange for a sum of money. Thus the principles of agrarian reform are

violated, land reconsolidation is once more in place, and farmers-beneficiaries are relegated to the

status of tenants again.

Worse, the protections afforded to farmers in these types of arrangements, as found in previous

administrative orders of the DAR, are not found in JAO 2008-1. DAR AO 9, Series of 2006[3] , for

instance, provides for rules intended to protect these lands and the ARB-owners thereof even while

the said lands are allowed to be leased (among other arrangements) for agribusiness purposes.

These are provisions on: (a) minimum amount rental – and the factors to arrive at that value; (b)

mandatory inputs from the investor, including an item on the investor’s assumption of the risk of

loss of agricultural operations, to include crop failure due to natural calamities or force majeure

(where the lessee -ARB is still assured of the payment of the lease rental); (c) specifics of tax

payments; (d) priority to qualified and willing ARBs and their dependents for employment in the

enterprise; (d) interim nature of the lease agreement – i.e. that the same shall only be intended to

enable the ARBs or their organization to develop skills necessary to assume general control and

management of the farm; (e) etc.

Bereft of these protections and uncertain of the security of their tenure, farmers are left on their

own to ride the winds of the market and the express provisions of the Constitution and the CARP

are left forgotten.

http://jaefever.wordpress.com/page/2/

4. By-products utilized in biofuel production

• Plants or crops we could utilize in What producing biodiesel and

bioethanol:
1. Coconut
2. Jatropha Curcas (Tuba-tuba)
3. Sugarcane
4. Sweet Sorghum
5. Cassava
6. Malunggay
7. Corn
8. Sugar Beet
9. Oil Palm
10. Soy Bean
11. Algae (This is highly considered and is into research and development stage in other
countries)
12. Wood, grasses, or the non-edible parts of plants

• Byproducts Of Biofuels Could Be Economically Viable For Growers

Animal scientist William Dozier, formerly with the ARS Poultry Research
Unit in Mississippi State, Miss., has been working with colleagues at the ARS
Swine Odor and Manure Management Research Unit in Ames, Iowa, and
Iowa State University (ISU) to find ways to supplement animal diets with
glycerin. Glycerin, a biofuel byproduct, contains energy-providing nutrients
for animals.

Dozier and ISU colleague Kristjan Bregendahl evaluated the use of glycerin
supplements in poultry feed. Dozier primarily dealt with broilers, which are
chickens raised specifically for meat production, and gave glycerin-
supplemented poultry feed to broilers that were 7 to 45 days old.

Dozier evaluated the apparent metabolizable energy (AME) intake—a

standard measure of energy—for the study group and for a control group that
ate a standard diet. The youngest chicks, aged 7 to 10 days, showed a higher
AME intake than the control group. However, the two groups showed no
significant differences in the amount of feed they consumed, body weight, or
the amount of energy lost in feces and urine (energy excretion).

The second group of broilers, aged 21 to 24 days old, that consumed glycerin
feed supplements showed no difference in body weight, energy excretion, and
AME. However, their feed intake and the amount of energy provided by the
diet intake (gross energy) increased when glycerin supplementation increased.
The oldest broilers, aged 42 to 45 days old, showed increases in feed
consumption, gross energy, and AME.
 Dozier notes that from a nutritional standpoint, this technology can serve as an
alternative dietary energy source that could result in lower feed costs. Swine
and poultry producers are very interested in supplementing livestock feed with
glycerin, in part because the corn grain and soybeans that used to be fed to
livestock are now being used for biofuel production. This way, the crops can
be used for both biofuels and for livestock feed.

http://www.sciencedaily.com/releases/2009/04/090419202443.htm

*ScienceDaily (Apr. 26, 2009) — Agricultural Research Service (ARS)

scientists have found environmentally and economically sound uses for the
byproducts of biofuel production. Copyright © 1995-2010 ScienceDaily LLC —
All rights reserved — Contact: [email protected]

5. Sources of Biofuel in the philppines

• Sugar as biofuel in the Philippines may not be as “sweet” as

promised 01.04.2009

Sugarcane conversion into biofuel is cost-effective with petroleum fuel when oil
prices are high; it reduces greenhouse gas emissions, and diversifies energy sources.
Ethanol production from sugarcane may look good at the outset but do these rewards true
to its form?
In an article published in the Philippine Agricultural Scientist, UPLB economist
Prof. U-Primo E. Rodriguez and Dr. Liborio Cabanilla, dean of the College of Economics
and Management, noted that using sugarcane as source of energy may have adverse
effects. Both examined the potential implications of using sugar as biofuel feedstock,
particularly on the country’s agriculture and food security.
Sugar is an important commodity in the Philippines, a major input in food
processing industries. In 2007, the Department of Agriculture reported that by 2001 about
8.5 M metric tons of sugarcane will be needed to fulfill the mandated blending of
gasoline with 10% ethanol. This represents around 37% of the total sugarcane produced
in the country in 2005.

Using a Computable General Equilibrium (CGE) model, the researchers found

that there would be several implications to the agricultural and food processing sectors if
sugar is to be used for biofuel production.

General implications

“Devoting sugarcane as biofuel feedstock would probably raise the average

domestic prices of agricultural, fishery and forest products, which in turn will make
production costs higher and therefore increase prices of food products in the market,”
Prof. Rodriguez stated.

They estimated that while value added and employment will grow in the
agriculture, fishery and forestry sector, it will be the opposite for the food processing
sector.

All in all, this would affect people’s spending behavior. Consumption is projected
to fall by 0.18%. Prof. Rodriguez also added that agricultural, fishery, forest and food
products export will decline.

Specific impacts to the sugar industry

According to the research’s simulation, there are significant impacts which would
greatly affect the sugar industry. First would be the increase of about 18.5% of sugar
prices due to the stimulating demand for sugarcane. This would induce significant
increases in the value added and employment in the sugar industry.

The big expansion of the sugar industry, however, will just be the only reason for
the general expansion of the agriculture, fishery and forestry sector. Rodriguez explained
that the expanding sugar industry will affect industries such as corn, livestock and
poultry, probably due to the possible allocation of resources to sugar planting.

Simulation results indicate also that some economic activities such as sugar
milling, petroleum refining and mining will contract.

More analysis needed

While the research results showed that sugar for biofuel will have adverse effects
on the economy, Prof. Rodriguez recommended more in-depth studies should be pursued
to get a better informed assessment. He further added that economists should also focus
on the other dimensions of economic development and environmental impact.

“Although our CGE model have provided sound economic frameworks for
analysis, a more rigorous economic evaluation of the food vs. fuel issue would definitely
need other studies using complementary analytical and quantitative tools,” Prof.
Rodriguez concluded.
http://www.innovations-
report.com/html/reports/environment_sciences/sugar_biofuel_philippines_sweet_promise
d_130291.html
Prof. U-Primo E. Rodriguez
College of Economics and Management
University of the Philippines Los Baños
Telephone: 049 536 2505
Telefax: 536 3641
Email: [email protected]
Florante A. Cruz | Source: Research asia research news
Further information: rdenews.uplb.edu.ph
www.researchsea.com

• DA Says Sweet Potato, Cassava Good Biofuel Sources

The Department of Agriculture (DA) has accredited some sweet potatoes and
cassava varieties as good sources for biofuels. Sweet potato and cassava are identified as
feedstock for ethanol, which is bound to replace fossil fuels as the world's environment-
friendly, renewable fuel for cars, vans and buses.
National Seed Inspection Committee executive assistant Dr. Vivencio Mamaril
said sweet potato and cassava, aside from sugarcane are the country's best feedstock for
biofuel. They are easy to grow and harvest for food even as they could just as easily be
processed into biofuel.

Mamaril said that the Philippines has the land, resources and manpower to ride the
alternative fuels boom. The country has 2.4-million hectares planted to corn, 3.2-million
hectares to coconut, 390,000 hectares to sugarcane, and 330,000 to cassava and camote.

He added that if there is no oil to drill in the country then Filipinos must grow oil from
the soil. Cassava is best not just as pie but petrol while corn can also fuel cars.

Biofuel is a fuel derived from living things or their metabolic byproducts. Thus biofuel is
a renewable energy source unlike petroleum, coal, and even nuclear fuel.

Mamaril said root crops are preferred for biofuel because they are rich in carbohydrates,
which can be broken down into alcohol through fermentation.

The government through the National Seed Industry Council of the DA, has accredited
some sweet potato and cassava varieties.
http://www.monsanto.co.uk/news/ukshowlib.phtml?uid=11158
Copyright 2007 Government of the Philippines All Rights Reserved

• Malunggay’s Moringa Oil Seen as Biofuel Source

As the Philippines seeks better ways to use its resources in combating climate
change, a new discovery by a Filipino biotechnology company based in the U.S.
has tapped a wonder plant in the country as a source of biofuel.

Malunggay, scientifically known as Moringa oleifera Lamk, which is widely

grown in the Philippines and is considered one the world’s most useful plants, is
found as a good source of Moringa oil. This oil is believed to be a biofuel source.

SECURA International announced that malunggay oil is being tapped by the

North American Biofuels Inc. (NABI) since January as possible raw material for
biodiesel production. As a result, the former is currently growing malunggay in
500,000-hectare farmland to meet the demands of NABI.
 Since malunggay can easily be grown in the country, SECURA International
president Danny Manayaga encouraged the Filipino farmers to take advantage of
the situation in meeting the demands of the world for the Moringa oil supply to be
used as biodiesel.

Manayaga said this business is sustainable since the market is very accessible.
Currently, there are 165 marketing companies in the U.S. for biodiesel using
soybean oil as raw material. It is expected that in the next 50 years, Japan and
Korea will be the biggest markets of Moringa oil for their automobiles that will
use biodiesel.

Others might be thinking of the real viability of Moringa oil as biodiesel. But the
NABI has already authenticated that it has passed the biofuels standards. This
means doubts of whether this can truly be used are over.

Earlier, the Philippine government is endorsing jatropha as a source of biofuel.

However, Manayaga said Moringa oil is more useful that jatropha. What makes
malunggay better than the jatropha is that malunggay is 100 percent usable; all
parts are biodegradable. Unlike jatropha, it has a toxic part. Once its oil is
extracted, the left-over part becomes a nuclear waste according to the findings.

With malunggay as a biofuel source in the Philippines, the country may in some
way help other countries reduce the impact of global warming by sharing the
benefits of Moringa oil.

http://www.meangreenbiofuels.com/malunggays-moringa-oil-seen-as-biofuel-
source/
Copyright © 2011 Mean Green All Rights Reserved.

6. oil imports and consumption

• Energy profile of Philippines
Under the leadership of President Gloria Macapagal Arroyo, the Philippines has
undergone an economic transformation, deregulating its energy sector and offering new
incentives for foreign investment. President Arroyo came into power when former
President Joseph Estrada was forced to resign in 2001, and in May 2004, she was
reelected to another six-year term. Her tenure has not been without controversy, however.
Most recently, in February 2006, President Arroyo decided to invoke a week-long state of
emergency after an apparent coup attempt. President Arroyo has also survived two
impeachment attempts over alleged corruption.

Despite some political instability, the Philippines has experienced strong

economic growth over the last two years. Real gross domestic product (GDP) grew at 5.0
percent in 2005, down somewhat from the 15-year high growth rate of 6.2 percent seen in
2004. The country is currently experiencing a minor cyclical downturn, driven by high
global oil prices and a slowing world economy. However, growth remains strong, with
the Philippine economy growing an estimated 5.5 percent during the first half of 2006. A
key driver of continued economic growth is overseas workers’ remittances, which help
sustain strong private consumption in the Philippines. During 2005, total remittances
from approximately seven million overseas workers stood at $10.7 billion, or about 11
percent of nominal GDP.

The Philippines is one of the claimants, along with China, Taiwan, Malaysia, and
Vietnam, to the Spratly Islands, located in the South China Sea. Potential oil and natural
gas reserves surrounding the islands have sparked the interest of all the littoral states. In
September 2004, the Chinese and Philippine governments reached an agreement to
jointly pursue seismic survey work in the Spratlys, but without giving up their respective
territorial claims. Vietnam joined the agreement in March 2005, and it was formalized
with a memorandum of understanding between the three governments.
Oil
Oil Production and Consumption in the Philippines, 1986-2006 (Jan-Sep only).
(Source: EIA International Energy Annual, Short-term Energy Outlook)
According to Oil and Gas Journal (OGJ), the Philippines had 138 million barrels
of proven oil reserves in January 2006. The country’s oil production is limited, averaging
just over 25,000 barrels per day (bbl/d) during the first nine months of 2006. Between
1996 and 2000, the Philippines had no oil production. During the last several years,
production has increased primarily due to the development of new offshore deepwater oil
deposits. The increased production volume is still modest, however, in relation to the
country's needs. The Energy Information Administration (EIA) estimates that the
Philippines will consume 349,000 bbl/d of oil during 2006.
Exploration and Production

Historically, the Philippines has not had significant domestic oil production.
Recently, exploration and production activities in deepwater areas off the Philippines
have increased the country’s domestic petroleum resources. This increase was due
primarily to the development of new deep-sea oil deposits in the Malampaya Oil Rim,
which are found underneath the large Malampaya natural gas field. The Malampaya
project is the country’s largest oil-producing area. Other recent exploration and
production activities have also focused on offshore oil prospects, and during 2005 the
DOE awarded eleven Service Contracts, mostly concentrated in the Mindoro, Salawan,
and Sulu Sea basins.
The Malampaya project was inaugurated in October 2001, with Shell as the
operator (45 percent stake), and Chevron (45 percent) and PNOC (10 percent) as project
partners. While natural gas production from the Malampaya area is significant, associated
oil production in the deepwater structure has been difficult to exploit. After committing
$2 billion in exploration and development costs, Shell and Chevron relinquished their
right to develop the oil rim project to PNOC in 2004, citing lack of sufficient oil reserves
and concerns over possible damage to the overlying natural gas-producing reservoir. In
June 2006, PNOC awarded a contract to Malaysia’s Mitra Energy to develop the
Malampaya Oil Rim. However, on August 10, 2006, President Gloria Macapagal-Arroyo
issued executive order 556, which declared that oil exploration and production activities
must occur through a strict bidding process rather than the farm-in deal that Mitra had
won. A spokesman for the Philippine DOE declared in September 2006 that PNOC will
open a new bidding round for the Malampaya oil rim project, which Mitra estimates put
recoverable oil reserves at 35 to 40 million barrels. While Philippine authorities hope to
conclude the new bidding round by year-end 2006, companies interested in the oil rim
have expressed concern that the project’s oil reserves are shrinking, as continued natural
gas production reduces the quantity of recoverable oil deposits.

PNOC has also engaged in exploration activities in the South China Sea, where
longstanding territorial disputes among countries in the region have limited development
of oil deposits. PNOC, the Chinese National Offshore Oil Corporation (CNOOC), and
PetroVietnam have signed an agreement to jointly explore the Joint Marine Seismic
Undertaking (JMSU) area. The companies have acquired initial seismic data, and will
reportedly decide whether or not to pursue the next phase of the JMSU project after
results from initial tests are released in November 2006.
Natural Gas

Philippine Natural Gas Production and Consumption, 2000-2004. (Source: EIA

International Energy Annual)
OGJ reported that the Philippines had 3.9 trillion cubic feet (Tcf) of proven
natural gas reserves as of January 2006, almost all of which is located in the Malampaya
natural gas field. The country had no significant natural gas production until 2001.
During 2004, natural gas production and consumption in the Philippines stood at 102
billion cubic feet (Bcf). Although natural gas consumption has ballooned in recent years,
in 2004 natural gas supplied less than 8 percent of the Philippines’ total energy
consumption.

A major impetus for changes in the country's natural gas sector has been the
Malampaya offshore natural gas field. Shell (the operator of the project, with a 45 percent
stake), Chevron (45 percent), and PNOC (10 percent) have come together to form the
$4.5-billion Malampaya Deepwater Gas-to-Power Project. The project is the largest
natural gas development project in Philippine history, and one of the largest-ever foreign
investments in the country. The Malampaya Project was officially inaugurated on
October 16, 2001 and holds an estimated 3.7 Tcf of natural gas reserves. Natural gas from
Malampaya is pumped via a 312-mile sub-sea pipeline to a natural gas processing facility
and three power plants in Batangas with a combined generating capacity of 2,700
megawatts.

In October 2006, Forum Energy announced that a natural gas prospect at the
Sampaguita field could hold up to 20 Tcf of possible natural gas reserves, based on
seismic data retrieved from the Sampaguita natural gas field. The field was originally
discovered in 1976, but never pursued because companies believed it to hold few
reserves. Some industry analysts question the 20 Tcf figure, saying that previous
exploration work at Sampaguita revealed a more likely range of 3.5 to 5 Tcf of natural
gas reserves. Forum Energy plans to test drill at Sampaguita in the future, and if testing
confirms substantial natural gas reserves, the company will reportedly consider a
liquefied natural gas (LNG) project.
http://www.eoearth.org/article/Energy_profile_of_Philippines
Published: September 23, 2008, 2:23 pm
Edited: September 23, 2008, 2:23 pm
This article has been reviewed by the following Topic Editor: Langdon D. Clough

Issues/Articles
Biodiesel – The Facts On What Is Going On
Any fuel made to drive a diesel engine is called diesel fuel. Most people
are familiar with petrodiesel, and don’t even bother to add the prefix. But
advances in physical and chemical biomass conversion and processing have made
the term biodiesel a term that may not yet be commonplace but has probably been
heard by most adults in developed nations. The usual sources for biodiesel are oils
and fats, which are mixed with a solution of methanol that contains sodium
hydroxide (lye, an extremely caustic substance). Amazingly, the eponymous
Rudolf Diesel demonstrated biodiesel at the 1900 Paris World Exposition using
an engine that ran on peanut oil. Gasoline engines rely on a spark to fire, and can
be quite finicky about fuel, but diesel engines depend on high cylinder
compression to heat and ignite the air/fuel mix, so many modern diesel engines
can run on 100 percent biodiesel and others can run on petro-bio mixes. That’s
good news for the air: according to the Department of Energy, pure biodiesel
emits 75 percent less CO2 than petrodiesel, and mixes by anywhere between 75
and 15 percent.

There are many potential biomass sources for making biodiesel. For example, the
Industrial Agricultural Products Center, which is part of the University of
Nebraska at Lincoln, recognized that its home state leads the nation in
commercial cattle slaughter. That process yields not only the steaks and burgers in
your grocery store but also 1 billion pounds a year of tallow. Accordingly, the
IAPC has developed a biodiesel that makes use of this largely unused material.

Food industry giant Perdue Incorporated (the chicken people) actually formed a
BioEnergy group dedicated to biofuels. Oddly enough, Perdue is the twelfth-
largest grain company in the United States and has three soybean crushing plants
and a deepwater port, so the company works with biodiesel and ethanol producers
to make feedstock (any raw material fed into an industrial process in this case, for
generating power).

Another food industry heavyweight, Tyson Foods, produces more leftover animal
fat (from chickens, cattle, and hogs) than any other company in the U.S. The
company recently announced a renewable energy division of its own to put to use
 the 2.3 billions pounds of chicken fat they create each year. That could make
around 300 million gallons of pure biodiesel, or go into the most popular petro-
bio mix, a B20 fuel 80 percent petrodiesel, and 20 percent biodiesel. Americans
use almost 40 billion gallons of diesel a year.

Biodiesel currently has a good news/bad news story. The good news is that it
exists, it works, and it’s getting easier: in 2000 there were 88 plants in the U.S.
producing 250 million gallons of biodiesel. The bad news is that most of the
biodiesel (and other biofuels) comes not from industry leftover but from energy
crops such as soybeans, which require significant farm acreage that could
otherwise be used to produce vegetables and grains for human consumption.

The Defense Energy Support Center, which handles securing fuel for the Depart
of Defense, is the single-largest consumer in the U.S. of biodiesel (5.2 million
gallons in 2003-2004; more recent figures are unavailable). The U.S. began using
B20 in its non-tactical vehicles in 2003. The military consumes between 120 and
145 million barrels of oil in a single year; according to the Department of
Defense, every $10 increase in the price per barrel of oil means another $1.3
billion the military needs to keep its fleets operational.
http://www.meangreenbiofuels.com/biodiesel-the-facts-on-what-is-going-on/
Copyright © 2011 Mean Green All Rights Reserved.

• First biodiesel plant for the

Philippines.

The first biodiesel production plant in the Philippines, located at Bagumbayan, Quezon City, is
due to come on stream in the first quarter of 2006 with a capacity of 60M litres/year, reports
Cocomunity.

Last year, President Gloria Macapagal Arroyo signed a circular memorandum directing that all
government diesel vehicles should be run on a blend containing 1% coconut biodiesel (coconut
oil methyl ester, CME), and the Department of Energy has since been promoting its use. It says
that, while the coco-biodiesel B1 is marginally more expensive than regular petroleum diesel, the
benefits gained include a 60% reduction in smoke emissions, lower maintenance costs and a
minimum of 10% improved mileage.

* Philippine motor fuel retailer Flying V says it will soon make a branded coco-biodiesel-Envirotek
Bio-Diesel Premium--available at all its fuel stations nationwide.

http://www.allbusiness.com/manufacturing/food-manufacturing-grain-oilseed-
milling/845934-1.html
Copyright © 1999 - 2011 AllBusiness.com, Inc. All rights reserved.

• Why we should produce Biodiesel and

Bioethanol in the Philippines?
With the Philippine Biofuels Act signed into Law also known as Republic Act 9637 by
President Gloria Macapagal Arroyo and with senate and congress also agree with it. The
Philippines is open now to wide opportunity on investments on biodiesel and biofuels.
According to the laws provisions call for a mandatory mixing of 1% of Biodiesel in
PetroDiesel and 5% of Ethanol in Gasoline for the first 4 years. It will then be increased
to2% for Biodiesel and 10% for Ethanol. It is said that the author of the bill is
Congressman Miguel Zubiri and lobbied the bill to be passed across senate and congress and
finally by our president. By the way, this was a good time for congressman Zubiri because he
was running for senatorial seat and he won because many farmers were happy with the bill he
authored and passed.
So lets be clear on this, because Philippine government has already passed a bill on biofuel
then we could say we have already government policy supported project. Which means
companies will now have confidence in investing in a project that our government is
supporting which is very important in a business feasibility of a venture company in any
industry. This is always taught on how to make a feasibility study in college. Government
policy should be researched and evaluated in entering a business. In 2006, it was signed by
President Gloria Macapagal with provisions of 1% biodiesel and and 5% bioethanol and after 4
years (2010) it will increase to 2% biodiesel and 10% bioethanol mandatory mixing with our
gas companies.
Example:
Flying V Gas Company has already used Coconut Methyl Ester (CME) as Biodiesel mixed in our
diesel gas for lesser pollution, better combustion and more engine power to our vehicles
according to Philippine Coconut Authority (PCA) in partnerhip with flying V.
Another company Chemrez has exported CME in Japan and other countries that also has a
mandatory mixing of biodiesel and bioethanol in there country and percentage are higher than
ours.
Plants or crops we could utilize in What producing biodiesel and bioethanol:
1. Coconut
2. Jatropha Curcas (Tuba-tuba)
3. Sugarcane
4. Sweet Sorghum
5. Cassava
6. Malunggay
7. Corn
8. Sugar Beet
9. Oil Palm
10. Soy Bean
11. Algae (This is highly considered and is into research and development stage in other
countries)
12. Wood, grasses, or the non-edible parts of plants
Production Process:
1. Bioethanol – grow crops high in sugar and use yeast fermentation to produce ethyl alcohol
(ethanol)
2. Biodiesel – vegetable based oils are heated, their viscosity is reduced, and they can be
burned directly in a diesel engine, or they can be chemically processed to produce fuels such
as biodiesel
3. Cellulosic ethanol (Ceetol) – here are two ways of producing alcohol from cellulose:
* Cellulolysis processes which consist of hydrolysis on pretreated lignocellulosic materials,
using enzymes to break complex cellulose into simple sugars such as glucose and followed by
fermentation and distillation.
* Gasification that transforms the lignocellulosic raw material into gaseous carbon monoxide
and hydrogen. These gases can be converted to ethanol by fermentation or chemical catalysis.
They both include distillation as the final step to isolate the pure ethanol.
Cellulolysis (biological approach)
There are four or five stages to produce ethanol using a biological approach:
1. A “pretreatment” phase, to make the lignocellulosic material such as wood or straw
amenable to hydrolysis,
2. Cellulose hydrolysis (cellulolysis), to break down the molecules into sugars;
3. Separation of the sugar solution from the residual materials, notably lignin;
4. Microbial fermentation of the sugar solution;
5. Distillation to produce 99.5% pure alcohol.
Issues to consider:
1. mitigation of carbon emissions levels and oil prices
2. the “food vs fuel” debate
3. deforestation and soil erosion
4. impact on water resources
5. and energy balance and efficiency
Demand drivers:
1. rising oil prices
2. concerns over the potential oil peak
3. greenhouse gas emissions (causing global warming and climate change)
4. rural development interests
5. and instability in the Middle East
Points to Ponder:
1. economical – Labor vs. Production vs. Price
2. sustainable – food security vs. commercial supply vs. steady supply
3. feasible – economical + sustainable + steady supply
Present Industry Situation:
1. Coconut has been one of our top export crop since the Spanish era. And at present we are
already producing Coco-biodiesel and is considered economical, sustainable, and feasible with
companies having already mixed CME with diesel gas and companies exporting to supply other
countries.
2. Sugarcane has also been one of our export crop with sugar as its by products. Like coconut
I consider the crop economical, sustainable, and feasible because of supply. Also sugarcane
producing province like Negros Occidental are investing billions of pesos for bioethanol plants.
Iam sure they know the potential of sugarcane. They have done there feasibility on this.
3. Jatropha, Corn, Sweet Sorghum, and other plants and crops will have a hard time to market
penetrate the Biofuel industry because of existing crops that have been used traditionally in
our country like coconut and sugarcane. I consider corn traditional crop but it will compete
with the feed industry and food security issue. So there is a big question for corn being used
for bioethanol. Jatropha and Sweet Sorghum are in the infant stage of R&D and also have
issues as one of the constraints to be used as biofuel source.
http://blog.agriculture.ph/tag/biofuel-in-the-philippines
www.da.gov.ph
www.pca.gov.ph
www.senbel.com.ph