Mumbai, Dec. 30: The sugar industry couldn’t have had it sweeter. Thanks to the Centre’s decision making the doping of petrol with 5 per cent ethanol mandatory in nine states and four Union Territories starting Wednesday, sugar manufacturers are now being actively courted by petroleum firms.
Oil companies are queuing up to sign long-term deals with sugar manufacturers that will assure them of feedstock supplies, ethanol being a major by-product in the making of sugar. The government diktat follows the success of pilot projects in Maharashtra and Uttar Pradesh.
Gasohol — ethanol-blended petrol—will be launched across the country by the oil marketing companies in the presence of petroleum minister Ram Naik and consumer affairs, food and public distribution minister Sharad Yadav on January 1.
Already, a leading private sector oil refinery major has tied up with south-based sugar manufacturers for the feedstock. PSU oil refineries are not lagging behind either, as they have entered into tieups with manufacturers for the crucial by-product.
Oil industry sources said many refiners based on the western coast and the southern region have tapped sugar companies based in the south and also those in western Maharashtra.
A private refiner has even arranged for transporting ethanol via sea route as it works out to be economical. Sources also say the new arrangement will be a win-win situation for both industries. While the sugar industry will naturally benefit demand perks up, margins of petroleum companies for Gasohol are enough to ensure co-operation from the refineries.
Ethanol-blended petrol was initially introduced in Bareilly, Miraj, Manmad, Aonla, Rajamundhry and Pathankot. It will be available in Maharashtra, Gujarat, Goa, UP, Haryana, Punjab, Karnataka, Tamil Nadu, Andhra Pradesh, Pondicherry, Chandigarh, Dadra & Nagar Haveli and Daman & Diu from January 1.