Dutch firm quits ethanol plan, eyes liquid biogas

AMSTERDAM (Reuters) - Dutch firm Bioethanol Rotterdam expects to secure financing in the next two months for a liquefied biogas plant it wants to build in the Netherlands, after scrapping plans for a wheat-based bioethanol plant.

Managing Director Peter van der Gaag said on Monday the 90 million euro ($127.3 million) project would be funded partly by government subsidies but the company is also in talks with other firms and investors to secure additional funds.

Van der Gaag is applying for permits to build the plant in the northeastern Dutch town Delfzijl, where he sees more concentrated investment in energy projects compared with other cities such as Rotterdam.

He said the plant, which the firm hopes to bring online in 2011, would produce about 35,000 tonnes of liquefied biomethane annually, from feedstocks ranging from agricultural waste to sewage sludge and switch grass.

"Biomethane will be the cheapest, cleanest biofuel made from waste in the future," Van der Gaag said, adding that he would target Britain and Sweden as export markets and also expected liquefied biogas to become an important fuel for shipping.

(Reporting by Catherine Hornby; editing by Sue Thomas)