CNE and Sunbird to develop bioethanol facilities in Zimbabwe and Zambia

China New Energy has entered into a Memorandum of Understanding with Sunbird Bioenergy Africa for the development of two biorefineries, one each in Zimbabwe and Zambia.

The Memorandum of Undestanding (MOU) was signed at the Forum on China-Africa Cooperation (FOCAC) 6th Ministerial Conference and Summit in Johannesburg, South Africa.

Under the terms of the MOU, China New Energy (CNE) will be responsible for designing the two biorefineries and supplying the key operating components including pre-treatment of feedstock, fermentation, distillation, and dehydration, as well as project management and support services.

Zimbabwe CNE will assist Sunbird Bioenergy to develop a bioenergy project that, at full capacity, is expected to deliver 120 million litres of fuel grade ethanol for the Zimbabwean government’s biofuel blending programme.

The Zimbabwe project draws upon CNE’s experience at the Ubon Bioethanol plant in Thailand and is expected to use mixed feedstocks including cassava and molasses that will primarily be sourced through an out-grower programme.

This project will help the government deliver on their Zim-Asset programme by creating local infrastructure, jobs, and energy security.

CNE estimates that the project cost for the plant of this nature is in the region of $50 million (€46.2m) over the two-year development period.

CNE is now set to begin a feasibility study and to draft up design specifications and an environmental impact assessment.

Commencement of development for each plant will also be subject to raising the necessary project finance.

If sufficient fund can be raised, construction is estimated to start in 2016 and commercial operations in late 2017.

Under the terms of the MOU, CNE has also undertaken to develop a similar project with Sunbird in Zambia.

Sunbird is at an advanced stage of negotiations with the Zambian government to develop a project on the Luena Farm block in Luapula province.

Whilst representatives of the Zambian government have publically stated that the project shall proceed, Sunbird is still finalising the terms of the transaction and the necessary contracts.

Zambia has a chronic energy and job shortage and the parties have all indicated that they would like the development of the project to commence in 2016, with commercial operations starting in 2017, to help mitigate these effects.

‘We are delighted to sign this MOU at the FOCAC Summit and bring these important projects the attention of Chinese and African Ministers and senior members of the investment community,’ says Yu Weijun, chairman of CNE.

‘We maintain our view that Africa provides a long-term opportunity for CNE as the development of its bioenergy industry helps African governments deliver on their goals of energy security, job creation and economic empowerment of rural communities,’ Yu states.