Indian Oil, BPCL Fuel In More Funds For Ethanol Production
Indian Oil Marketing Companies (OMCs) in India now seems to have increased their funding for ethanol production in India. This biofuel is now used in the country to blend with petrol under the National Ethanol Blending Programme of the Ministry of Petroleum and Natural Gas.
In its latest spree, the oil marketing companies gave away orders to Modi Naturals Ltd to boost ethanol production. Modi Naturals Ltd. (MNL) announced a substantial order through its wholly-owned subsidiary, Modi Biotech Private Limited (MBPL). The company has successfully secured an order for 3.72 Crore Litres of ethanol, with an estimated value of approximately Rs. 240 Crores, from various Oil Manufacturing Companies (OMCs) including Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL).
This order aligns with the Ethanol Sugar Year (ESY) schedule, spanning November 2023 to October 2024, and will be fulfilled in four phases. Not only will Modi Naturals deliver on the ethanol requirements, but the byproducts generated during the production process will also be sold separately, contributing to additional revenues, it said. This cumulative volume of 3.72 Crore Litres, combined with the byproducts from production, sets the stage for a remarkable Total Revenue potential of 275 Crores.
Commenting on this significant development, Akshay Modi, Managing Director of Modi Naturals Ltd., said, “We are extremely happy with the successful commissioning of our ethanol facility and the progress achieved thus far. This latest order marks a transformative moment for Modi Naturals, promising positive impacts on our balance sheet. Our immediate focus is on stabilizing plant production in the coming weeks, paving the way for Phase II expansion to maximize the facility’s full capacity.”
As outlined by the Government of India, EBP aims to reduce import dependence, save foreign exchange, boost the domestic agriculture sector, and provide crucial environmental benefits.
The company recently inaugurated its state-of-the-art ethanol distillery in Raipur, Chhattisgarh. With boasting a robust production capacity of 210 KLD (thousand litres per day) and a 5.5 MW cogeneration power plant, this facility is poised to profoundly impact the biofuel landscape. The facility is planned to operate at 130 KLD in the first phase, with a capex of Rs 150 cr with debt of Rs. 105cr.
