550 million litres to be sourced through open tender: Deora

New Delhi, Nov 8 (UNI) Petroleum and Natural Gas Minister Murli Deora today said 550 million litres of Ethanol required for domestic use would be sourced through open tenders which is currently under progress.

''The ministry is anxious to provide the right signals for promotion of alternative sources of energy to supplement liquid fossil fuels,'' Mr Deora said.

He said the government has notified that from November one 2006, subject to commercial availability, five per cent of ethanol blended petrol will be sold across the country except the North-east, Jammu-Kashmir and Andaman-Nicobar islands.

Speaking at the Economic Editors Conference here, the Minister said this measure would help the farmers with better returns and also supplement the availability of petroleum products in the country.

The bio-diesel policy prescribes that the oil marketing companies in the public sector shall purchase bio-diesel of prescribed BIS specification from registered authorised suppliers through 20 purchase centres at a uniform price, which is subject to review by oil companies every six months.

He said the present procurement price is Rs 26.50 litres (from Rs 26 litres fixed last year) which will be valid till December 2006.

Shree Renuka is one of about 120 companies in India that convert molasses -- a byproduct of sugar -- into ethanol. It plans to expand fuel ethanol output to 70 million litres in the next crop year, from 15 million this year.

''Ethanol is the only large viable biofuel in India -- it's building on an infrastructure and industry that is already quite large,'' he said. ''We see the (total) ethanol market growing to 2.3 million litres.'' India plans to soon remove a ban on sugar exports, on expectations of a record crop, after producing 19.3 million tonnes of sugar in the season that ended in September. Indians consume over 18 million tonnes of the sweetener annually.

UNI RT CS BS1812