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Southern Oil Refining to build advanced biofuel pilot plant in Australia

Southern Oil Refining, an Australian oil recycling company, has secured a contract to build a AUS$16 million (€10.7m) biofuel pilot plant in Australia.

The facility, titled Northern Oil Advanced Biofuels Pilot Plant, will be built in Gladstone, Queensland, and will produce biodiesel from sugarcane bagasse.

The pilot plant is expected to be operational later in 2016 and will aim to produce one million litres of fuel within three years for use in field trials by the US and Australian navies.

Airlines Virgin and Qantas have also expressed interest in using the produced fuel to power their aircrafts.

There are eventual plans to expand the plant into a AUS$150 million commercial-scale refinery that would produce 200 million litres of advanced biofuel a year.

The facility was originally planned to be situated in Wagga Wagga, News South Wales, where Southern Oil is headquartered, but the Queensland state government offered the company a monetary grant to cover the costs of building the plant in Gladstone instead.

Queensland Premier Annastacia Palaszczuk said the "small amount of money" was worth it to bring the plant to Queensland.