Malanyaon, GMA witness signing of $200M investment for Davao Oriental

Philippine-based company Guidance Management Corporation (GMC) signed an agreement with the Spain-based firm Green Fuel Corporation for a joint venture that will undertake several bio-fuel projects in Davao Oriental.
 
The agreement was signed at a business meeting last December 4 in Spain's capital, Madrid. The signing was witnessed by President Arroyo, Gov. Malanyaon, Trade and Industry Secretary Peter Favila, Senator Miguel Zubiri who authored the the Philippine Biofuels Act and top officials of the Spanish Confederation of Business Organizations.
 
The project's investment in its initial phase is estimated at $150 million which will be allocated to planting of at least 60,000 hectares of palm in Davao Oriental, creating jobs for some 10,000 families in the province.
 
Green Fuel Corporation is a biodiesel company whose shareholders include Spanish utility Endesa and Tecnicas Reunidas, one of the world's largest general contractors. The unprecedented and historic link-up between a European and Philippine companies is by far the most comprehensive joint venture agreement signed to date for the Philippine biodiesel industry as the joint venture will develop the entire value chain, encompassing the procurement of feedstock, oil crushing, extraction and refining as well as the production of biodiesel.
 
 The Chairman of GMC, Jack Rodríguez, defined the relations with GFC, as “strategic for the joint development of vertically integrated biodiesel projects in the Philippines”. President Arroyo has pledged her full support for the joint venture, while Senator Zubiri and Governor Malanyaon have underlined their commitment to facilitating the development of this milestone biodiesel project. For his part, the President of GFC, José Luis del Val, stated “that the presence in the Philippines, apart from expanding the raw material base required for our projects, opens up the path to a region, Asia, with enormous economic growth potential, where more than half of the world’s population live, from a country (the Philippines) historically rooted with Spain.”
 
As part of the agreement, both companies have constituted a joint-venture, open to the incorporation of other local partners from the fuel distribution sector, as well as companies that can add value to the biodiesel production chain, with the objective of securing raw materials (coconut, palm and jatropha oils) via mass cultivation of oleaginous plants, the construction of an oil crushing, extraction and refining unit with an annual vegetable oil processing capacity of 200,000 tons and a biodiesel plant with a production capacity of 110,000 tons per year. This will be followed by the gradual expansion of the company to other countries in Southeast Asia.
 
The initial steps of the project are directed towards the extraction of coconut oil, of which there are plenty in Davao Oriental, and the planting of a high-yielding variety of oil palm for feedstock, to be followed by the sowing of jatropha, once its economic viability and availability in sufficiently large quantities can be guaranteed.
 
The project’s investment in its initial phase is estimated at US$ 150 million, which will be allocated to planting 60,000 hectares of oil palm on ancestral and public lands in Davao Oriental, creating jobs for some 10,000 families of indigenous people.
 
Davao Oriental Gov. Corazon Malanyaon said that she was "grateful no end" to President Arroyo for her "all-out support" to their efforts to sell the province's investment and tourism sites to the world market. She also said that another "big amount of investment" is set to be poured in the province by investors from China who have planned to put up a fish processing plant in Davao Oriental.
 
However, top officials of the local government here are jubilant upon hearing the news of a big biofuel investment in Davao Oriental. "Good news for the people of Davao Oriental!," says the mayor of the City of Mati, Michelle Nakpil Rabat. Davao Oriental Second District Rep. Thelma Almario said many people in the province will finally get "much needed" employment with the entry of a big biofuel investor here as majority of the people here are heavily dependent on the ailing coconut industry.

ABOUT GREEN FUEL:
Green Fuel Corporación, which counts as shareholders Spanish multinationals Endesa, Técnicas Reunicas, Tepro Consultores and Asturian engineering group TSK, is leading the development of the biodiesel sector in Spain through a vertical integration model, and aspires to convert itself in the global reference in the sector, through the signing of agreements in raw material-producing countries, such as the Philippines, Argentina, Bulgaria or Rumania, among others. The company has initiated a strategic development plan, which will culminate in the construction of 6 biodiesel plants in Spain: Extremadura (already in construction), Andalusia, Aragon, Castilla y León, Castilla La Mancha and Catalonia. Its investment program totals some 350 million Euros distributed among Spain, Portugal, Eastern Europe, South America and Southeast Asia.
 
ABOUT GUIDANCE MANAGEMENT:
Guidance Management Corporation (GMC) is a Philippine conglomerate with interests in the mining, agriculture, and energy sectors, among others. Its entry into the Philippine biodiesel industry follows the opportunities detected by the company, and which it plans to jointly development with Green Fuel. (Ferdinand Zuasola, Davao Oriental Information Office)

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