SINGAPORE, June 25 Brazilian miner Vale SA
is planning to build the world's largest single
processing plant to turn palm oil into biofuel by 2015 in a bid
to cut its vast fuel costs and to develop the Amazon region, the
Financial Times said on Monday.
Under the project, which will cost more than $500 million,
Vale has acquired an area of cleared land in the Amazon
rainforest bigger than London. The biodiesel will be used to run
the company's machinery, ships, trains and trucks, the paper
Vale opened its first palm oil factory this month in
Brazil's Amazonian state of Para and will sell its output to
food producers in the market until it the processing plant is
completed, Eduardo Ieda, head of the miner's biodiesel company
Biopalma was quoted as saying.
Vale will probably break even next year and Biopalma's plant
will allow the miner to reduce its huge energy bill by producing
biodiesel at a cost that is about 30 per cent cheaper than
current market prices, the official was quoted as saying.
Energy accounted for 13.4 per cent of the company's total
cost of goods sold last year, according to a recent filing to
the US Securities and Exchange Commission, it said.
The project, which is spread out over a total area of
175,000 hectares in Para, is expected to produce about 600,000
tonnes of palm oil a year by 2019, Ieda was quoted as saying.
Last week, Vale also announced plans to invest $315 million
jointly with Australia's Pacific Hydro to build two wind farms
in Brazil's northeast to help meet the miner's electricity
(Writing by Naveen Thukral; Editing by Edwina Gibbs)