Listed D&L Industries, through its wholly-owned subsidiary Chemrez Technologies Inc. (CTI), is considering the construction of a second biodiesel plant to meet an anticipated rise in demand as the government moves to increase the biodiesel blend starting in October.
The company confirmed over the weekend that it is in the final stages of evaluating the risks and returns of the expansion.
“With the Batangas plant now completed and no other major capital expenditures in the pipeline, D&L has the financial flexibility to potentially undertake the construction of a new biodiesel facility, which would require much smaller capex compared to the amount spent on the Batangas plant,” D&L said.
However, it noted that any expansion plan requiring substantial spending would need shareholders’ approval.
By October, the government will raise the biodiesel blend from 3 percent to 4 percent, with a further increase to 5 percent by October 2026.
D&L pointed out that the expansion of biodiesel could boost the economy and the environment by driving new investments and job opportunities in agriculture and manufacturing.
The company also noted that a shift to a higher blend is also expected to enhance the country’s energy security by reducing dependence on imported fossil fuels.