OEPG floats EoI for procurement of 300 cr litres ethanol every year

What could prove to be a good push to the efforts of enhancing the clean fuel in the country, the government owned oil marketing companies (OMCs) will be procuring more than 300 crore liters of ethanol from upcoming biofuel manufacturing facilities in eight states and two union territories.

The OMCs Ethanol Procurement Group (OEPG) has issued an expression of interest (EOI) to attract bidders for long-term off-take agreements with forthcoming Dedicated Ethanol Plants (DEP) in eight Indian states.

The states included in this ethanol procurement initiative by OEPG are Tamil Nadu, Kerala, Andhra Pradesh, Telangana, Gujarat, Rajasthan, Goa, Odisha, along with the Union Territories of Jammu & Kashmir and Ladakh.

As per the EoI floated by OEPG, denatured anhydrous ethanol will be procured by the OMCs.

Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL), and Hindustan Petroleum Corporation (HPCL), collectively, will procure 301 crore liters of ethanol annually from plants scheduled to commence commercial operations within two years from the signing of the off-take agreement.

As per the document, bidders must commit to commissioning the proposed dedicated ethanol plant (DEP) within two years from the issuance date of the letter of intent (LoI).

The highest annual procurement of 97 crore liters will be from Tamil Nadu, followed by Kerala (55 crore liters), Rajasthan (44 crore liters), Gujarat (33 crore liters), and Andhra Pradesh (30 crore liters), said OEPG EoI.

According to the EOI document, shortlisted bidders entering into Long-Term Offtake Agreements and seeking financial assistance from banks/financial institutions will sign a Tripartite Agreement (TPA).

Prospective project proponents, including PSUs other than IOCL, BPCL & HPCL, intending to establish or in the process of setting up DEP, are eligible to apply through this EOI. Bidders who have established plants but have not commenced production prior to the publication date of this EOI are also eligible.

OMCs have introduced a marking system where preference is given to corn or maize. A bidder opting for sugarcane-based feedstocks is required to supply from all three types of feedstocks—Sugarcane Juice/sugar syrup/sugar, B-Heavy, and C-heavy molasses. They would also maintain a consistent supply throughout the year with adequate storage capacity at the plant.