An Israeli consortium comprising Evogene Ltd. (TASE:EVGN), Ormat Industries Ltd. (TASE: ORMT) US unit Orfuel Inc. and Lev Leviev Biofuel Namibia (Pty) Ltd. will develop, raise, and commercialize the castor plant in Namibia for the production of biodiesel. Castor is a non-food crop.
Lev Leviev Biofuel owns half of the joint venture, Evogene owns 37.5%, and Orfuel 12.5%. The joint venture will examine a number of castor plant varieties at a trial farm in Namibia. After selecting the most suitable varieties for the region, it will seek to commercialize these varieties and raise them in Namibia or other countries.
Evogene will provide the castor varieties for testing, Lev Leviev Biofuel will provide the land and logistics. The Lev Leviev Group of Companies is active in the Namibian diamond industry and owns a number of mining concessions in the country.
The companies believe that castor-based biodiesel will be substantially cheaper than biodiesel developed from food crops such as canola and soybeans. Evogene and Orfuel are already collaborating on the development of non-food biodiesel crops with the help of a grant from Israel-United States Binational Industrial Research and Development Foundation (BIRD-F).
Lev Leviev Biofuel Namibia CEO Eli Nefussy said, "We consider alternative energy in general, and biofuels in particular, as an industry of primary importance. We're pleased to be partners in this innovative project and we hope that this collaboration will become an important part in the creation of alternative energy sources."
For Evogene, which leads the project on the practical level, the goal is to reach the commercial stage within two years at most, with eighteen months worth of research already behind it. "The plants we distribute at first won't be the best possible, and I believe that they will improve with time. Our ambition is to be a world leader in performance of castor varieties for biodiesel," Evogene CEO Ofer Haviv said.
"We aim to cultivate very large areas, or 250,000 to 500,000 acres, and for that we seek to work with mechanized harvesting. Today, castor harvesting is manual. Even if manpower in Africa is cheap, harvesting 250,000 to 500,000 acres manually is not a reasonable task," Haviv added.
Haviv refuses to disclose financial details, but market assessments are that to reach the extent of cultivation that the joint company aims at it will need financing of upwards of $10 million, and it is expected that the three companies in the project will put in the money themselves or raise it from financing bodies.
Published by Globes [online], Israel business news - www.globes-online.com - on September 10, 2008
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