Biodiesel producer suffers another setback

A major multinational oil company has terminated advanced negotiations with Australian Renewable Fuels Ltd., based in Perth, to supply its Western Australian (WA) retail service stations with blended biodiesel. ARF Chief Executive John Lillywhite said the company was told that complexity with the logistics of blending biodiesel with bulk petroleum diesel fuel at the oil companys WA terminal was the reason behind the decision. Interestingly, the company remains in negotiations with the same oil company over a supply agreement from its Adelaide plant. The agreement is dependent on terminalling logistics. Lillywhite said while there was plenty of demand for biodiesel in the WA markets, particularly from major oil companies, the company has been met with uncooperative fuel suppliers. He said changes to the fuel tax legislation had forced producers to blend biodiesel with regular diesel at licensed blending sites, either controlled by or tied to major oil companies. (August 24, 2007)