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Monday, September 11, 2006

Recycling the past: rehabilitating Congo's colonial palm and rubber plantations

In this fascinating guest essay, Dr Fadjay Kindela looks at the potential of Congo's old plantations. The Democratic Republic of Congo, a vast country the size of Western Europe, just came out of a 10 year civil war, which has had a devastating effect on the plantation sector. The former Belgian colony once used to be a world leading palm oil and natural rubber producer. But after three decades of dictatorship and a decade of war, not much is left of the once thriving plantations.
In this first part of our three part essay, we look at the historic context of the palm and rubber industry in Congo. The story takes us from King Leopold's private colony, over the industrialisation under Belgian rule, to the disastrous "zaïrianisation" under dictator Mobutu. These plantations represent a dense history in which memories of violence, terror, immense wealth, and hope intertwine. The world is gradually coming back to 'bio-based economies' in which energy plantations will play a major role. This is why a look at the past might teach us a few things about our future.

From Leopold to Unilever - darkness and Sunlight soap
Leopold II, king of the Belgians, fervently believed that overseas colonies were the key to a country's greatness, and he worked tirelessly to acquire colonial territory for Belgium. The Belgian people and the Belgian government flatly refused to become colonialists, however, and Leopold eventually began trying to acquire a colony in his private capacity as an ordinary citizen.
After a number of unsuccessful schemes for colonies in Africa or Asia, in 1876 he organized a private holding company disguised as an international scientific and philanthropic association, which he called the "International African Society". In 1879, under the auspices of the holding company, he hired the famous explorer Henry Morton Stanley to establish a colony in the Congo region. Much diplomatic maneuvering resulted in the Berlin Conference of 1884–85, at which representatives of thirteen European countries and the United States recognized Leopold as sovereign of most of the area he and Stanley had laid claim to. On February 5, 1885, the "Congo Free State" was founded - an area 76 times larger than Belgium, which Leopold ruled as a personal domain. With the Congo Free State, a dark page in the history of colonialism was opened.

Leopold spent a fortune trying to manage his private state, but his funds quickly dried up because of expensive military campaigns. This led him to create a ruthless economic system based on quota, which forced the native population to harvest a certain amount of rubber and palm oil or be punished. The King wanted his private colony to be profitable, and native people were just an abundant 'natural resource' to be used like any other raw material.

The rubber that was first harvested in the Congo was latex coming from the vines of wild trees in the jungle, unlike the rubber from Brazil, which was tapped from hevea trees. To extract the rubber, instead of tapping the vines, the natives would slash them and lather their bodies with the rubber latex. When the latex hardened, it would be scraped off the skin in a painful manner, as it took off the natives' hair with it. This killing of the vines made it even harder to locate sources of rubber as time went on, but Leopold's quota system knew no mercy: the slaves had to penetrate ever deeper into the jungles to satisfy the King's greed.
To enforce the rubber quotas, the Force Publique (FP) was called in. The FP was an army, but its aim was not to defend the country, but to terrorise the local population into compliance. Armed with modern weapons and the chicotte — a bull whip made of hippopotamus hide — the Force Publique routinely took and tortured hostages (mostly women), flogged and raped countless villagers. They also burned recalcitrant villages, and above all, took human hands as trophies on the orders of white officers to show that bullets hadn't been wasted. (As officers were concerned that their subordinates might waste their ammunition on hunting animals for sport, they required soldiers to submit one hand for every bullet spent.)

In 1892, the State prohibits the technique of cutting rubber vines and decrees that for each ton of latex harvested, 500 vines have to be planted. This is the first attempt at creating genuine plantations. In 1910, around 20 million vines had been put into the ground, distributed over some 700 semi-industrial plantations.
Meanwhile, the much easier to manage hevea brasilensis was introduced and the first professional plantations were established in 1906, with material coming from Brazil and later from Sri Lanka. Due to a lack of agronomic knowledge, the yields of those plantations were disappointing, and so the system of harvesting wild latex -- using forced labor -- continued. The Congo Free State's record export of 6,000 tons in 1904, consisted mainly of "red rubber". The predatory extraction practises had made many a fortune, but had resulted in the death of countless Congolese.

The extraction of palm oil from natural palm trees (Elaeis guineensis) which covered vast areas, followed a similar path. Local people who traditionally used the different parts of the tree for a whole range of purposes (leaves for roofs, clothes, tools, baskets; fruits for oil and as an ingredient in cuisine; nuts for cooking and heating, sap to make wine...), were now suddenly introduced to the concept of brutal capitalism and 'free trade' and saw their trees and themselves being treated as mere commodities.
In the Congo Free State there were but a few attempts at creating palm plantations, mainly in the Bas Congo region, from where the first exports of palm oil and palm nuts departed for Europe and America. But between 1885 and 1908, most of the companies and private traders still used "hit and run" extraction tactics, just as in the rubber trade.

The historical research covering this era, with books such as Red Rubber, King Leopold's Ghost or even Joseph Conrad's novel Heart of Darkness (on which Coppola's movie "Apocalypse Now" is based), guarantee that this horrific history is not forgotten.

In 1908, after an international human rights campaign against the King's brutal quota system had reached a high point, Leopold was forced by the Belgian parliament to hand over his private crown colony to the Belgian state, which thus became a colonial power against its will. From then on, palm oil and rubber became genuine plantation crops on which a vast industry and the world's first multinational was built:

In a first phase, the Belgian colonizer focused on the development of hevea rubber, coffee and cacao plantations. In 1910, the state formally abolished the quota system and established hevea plantations, discouraging the exploitation of wild rubber. The astonishing development of the automobile industry led to a real demand explosion for natural rubber: millions of radial tyres had to be manufactured to keep up with the revolution that swept the planet. From the 1920s onwards, hevea production in Congo skyrocketed, with companies like Belgika, the Société Anonyme Belge pour le Commerce du haut Congo and the Kreglinger Group establishing vast plantations and making fortunes:

Rubber acreage and production in Congo after the global economic crisis

The oil palm sector only began to expand when on april 29, 1911, the state signed an agreement with the famous 'Lever Brothers', William and James, granting them the licence to create vast palm plantations and to build modern processing facilities.
The Lever Brothers had become famous and rich with their production of "Sunlight" soap. The feedstock for it came from palm oil which they sourced mainly in British West Africa (now Nigeria, Liberia and Sierra Leone). However, when they wanted to expand their plantations in order to meet rapidly increasing demand, the British government refused to grant them new concessions. Conditions at the Lever plantations were deemed to be 'problematic' and criticism from missionaries against these bad labor conditions was mounting. So the Lever Brothers looked elsewhere. To their great satisfaction, they found the Congo.

Through their company 'Huileries du Congo Belge', the Lever Brothers obtained the monopoly to harvest and process all palm fruits in the Congo, within five "circles" with a radius of 60 kilometres around the towns of Bumba, Barumbu, Basongo, Lusanga, Ruki/Momboyo. (The town of Lusanga was actually called "Leverville", where the company's Congolese headquarters were.) Thus, they obtained an area of 67,800 square kilometres (roughly two times the size of Belgium, or three times the state of New Jersey) where they created something akin to a 'state within the state'. Leverland. The use of local labor on the plantations was deemed 'free' but no coercion would be tolerated. However, historical research shows that forced labor was practised on a massive scale and for decades [*dutch/french].

The results of this convention between the Belgian Congo and the Lever Brothers were spectacular: from 1910 until 1920, palm oil exports increased from 2,160 to 7,624 tons, and palm nuts from 4,224 to 39,457 tons. By the year 1922, more than 50,000 hectares of natural palm plantations were exploited. In 1930, the Lever Brothers company had become one of the world's most profitable corporations and fused with the Dutch Margarine Unie to form Unilever, the world's first modern multinational. Today, the Anglo-Dutch company controls many of the world's food brands, and "Sunlight" soap is still used by many of us...

Other agro-industrial companies run by European colonists quickly saw the palm oil opportunity too. Around 1928, the first large corporations were formed in Mayumbe, such as the Société de Colonisation Agricole du Mayumbe (SCAM), the Société forestière et agricole du Mayumbe ( AGRIFOR), the Compagnie du Congo Belge (CCB) and the Plantation des Frères Egger. The Groupe Kreglinger from Antwerp installed itself alongside the Mongala river in the Equateur Province.
The expansion of the colonists' plantations looks like this:

Palm oil acreage and production of the agro-industrial sector in colonial Congo

Economic crisis, war, rubber as a strategic resource
The Wall Street Crash and the economic crisis of the 1930s was felt in the colonies too. In 1933 the price of palm oil had collapsed and was a mere third of what it was in 1929. Natural rubber faced a similar fate - and the small-scale exploitation of wild rubber, on which many thousands still depended, was entirely abandoned.

Action was taken to cut over-production and to halt further expansion of the acreage of palm and rubber plantations. But the crisis also launched an era of "rationalisation", whereby Fordian principles of production were introduced: cutting labor costs by streamlining and automating work methods. In a sector where manual labor was the main cost, this had the dramatic effect that many Congolese who already worked under harsh conditions, were laid off, to join the ranks of the global mass of unemployed.

The Belgian colonial government was relatively successful in fighting the crisis by implementing a series of financial and economic policies to keep the plantation sector alive: suppression of the right to export agricultural products, a radical tax reduction on transport costs, the creation of a temporary fund to finance the maintenance of plantations that were no longer actively exploited, and a halt of the ongoing process of social reform aimed to better the labor conditions on the plantations.
The economic revival came around 1934 with a rise in oil and rubber prices, and with the devaluation of 1938, which led to a 40% increase in export prices.

Just when the sector came back to its previous levels, the Second World War broke out, and trade between the colonies and Europe temporarily came to a standstill. But events in the East quickly turned the tide: the invasion and occupation of South-East Asia by the Japanese resulted in the allies losing a significant part of their palm oil and rubber resource, which meant that the Belgian Congo became of strategic importance to the allies. The production of rubber was absolutely essential to the war effort - the allied armies depended on it.

Therefor, in 1942 the colonial government issued an ordonnance forcing each Congolese citizen to devote 60 days per year to gathering forest products as part of the war effort. The targetted products were wild rubber, plantation rubber, palm fruits from natural palm forests and palm nuts from plantations.

This "Plan Hallet", as it was called, was extremely difficult to implement, because the memories of the Leopoldian terror regime were still fresh. Forcing the population back into the jungles to harvest wild rubber vines evoked fear; the message that their labor would ensure the colonial masters and their allies to win the World War that was being fought many thousand miles away, did not really convince the Congolese. Still, wild rubber production from this forced labor program increased from 2,000 tons in 1942 to 9,861 tons in 1943 and 9,263 tons in 1944.

Agro-industrial rubber enterprises attempted to comply with the decree by creating village-based plantations. The idea was to plant rubber trees in high densities, and tap them very rapidly (normally it takes around 5 to 7 years before a tree gets its first cut). The method showed disappointing results when it came to actual rubber yields per tree, but the sheer number of hectares planted was impressive: from 2000ha in 1941 to 28000ha by the end of the war.

Meanwhile, the plantations of the agro-industrial companies and private colonists themselves expanded very rapidly too, now that they had become the most important resource for the allies: they increased from 56,000 hectares in 1939 to 84,000 hectares in 1944.

Rubber exports from Congo, 1940 - 1950, showing a peak near the end of the Second World War, when rubber production in the colony was part of the "war effort".

Post-war colonisation and Indepedence
After the war, the government took measures to increase the number of colonists in the Congo. The immense country counted only around 10,000 of them in 1958, some 2000 of whom were involved in agriculture. Three quarters of those were Belgians. The plantation sector now became a well organised agro-industrial business, at the time the world's largest, from which the Belgian Congo derived impressive amounts of wealth.

Palm oil was mainly cultivated in the lower Congo basin, but the Mayumbe region and the Kwilu district in the Bandundu province remained prime zones of private sector initiatives - despite their less favorable climatic conditions. A considerable amount of the palm production was still based on extraction from natural palm forests, though. At the beginning of the 20th century, these covered more than 1 million hectares, some 250,000 of which were considered to be exploitable on a semi-intensive level. For years, the Kwilu district in Bandundu Province counted as the country's biggest producer of palm oil from natural forests.
At the beginning of the 1950s there were around a hundred industrial and semi-industrial palm oil producers in the colony who relied on these natural palm forests, of which 50,000 hectares had been 'cleared' of other plants to make their exploitation more efficient. The tonnage of palm fruits sold to those factories increased from 540,000 tons in 1949 to 780,000 tons in 1958.

From 1945 to 1958, natural rubber saw another boom because of rapidly increasing world prices, fuelled by the War in Korea. The temporary war effort decree was terminated, and agro-industrial companies now increased production by an unprecedented investment in productivity, in streamlining harvesting methods, and in investing in new processing facilities.

Obligatory smallholder plantings
Another way of extracting the natural resources of the Congo consisted of organising small plantation units around villages - private family plots run by native smallholders. The Congo Free State had already forced the plantation of palm and rubber trees around villages, even though a real policy of "cultures obligatoires" ("obligatory cultivation") dates from 1917.

The so-called "Paysannat" programme which had "educative" purposes was intended to exploit the vast pool of rural labor that was not being used. Model villages, cooperatives and missions were built, but in general, the system came down to forced labor.

Between 1927 and 1930, each farmer in the Equator Province had to plant 10 palm trees per year with the result that by 1935 these small privately run plantations started to contribute to the colonial economy. By the end of 1936, 1,600 hectares had been planted in the Léopoldville Province (today known as Bas Congo and Bandundu), 1000 ha in the Equator Province, 2,000ha in the Oriental Province and 1000ha in both Kasaï Provinces. For rubber, the situation was similar: in 1941 some 2000ha had been planted, and by the end of the war, some 28,000ha had been established, mainly in the Equator Province, in Kasaï and in the Orientale.

In the beginning, the results of this policy of obligatory planting were rather disappointing. The local colonial administration didn't care much about the program, a myriad of customary and 'native' laws about land ownership and utilization acted was a barrier to the forced plantings, and the Congolese farmers themselves resisted this imposed form of labor.

Over the years, the resistance to the program waned, because villagers derived certain monetary benefits from it. In 1939 some 18,500 hectares were planted under the program, and 5 years later the hectarage had increased to 40,000. The program eventually contributed significantly to the colonial economy, and after the independence it was more or less continued.

On June 30, 1960, the Belgian Congo obtains its independence from the Metropolis. The vast country is rapidly thrown into chaos, with several resistance movements and political factions trying to cessede. Especially the mineral rich East and South of the country wanted to break away to create an independent state, mainly to keep the revenues from the mining industry for itself. These separatist movements were backed by Belgian industrialists and the U.S.

The chaos and war affected the palm industry and around 30,000 hectares were lost. Luckily, most of those (60%) were older than 25 years and had to be replaced. The rebellions in the rural areas had a devastating effect on the smallholder rubber sector, which went entirely into decline. The production in this sector dropped from 3,500 tons in 1960, to a mere 200 tons in 1973.

In 1965 General Mobutu takes power, suspends the Constitution and dissolves the parliament. In 1966 he turns Congo into a One Party state, with the Mouvement Populaire de la Révolution, the presidential party usurping all power. The country becomes Zaïre. A dictatorship that will last longer than 3 decades was born.

"Zaïrianisation" - an economic disaster
Dictator Mobutu had been brought to power by the Americans and the Belgians, in an attempt to get rid of the nationalist and democratically elected leftist leaders who talked about social justice and economic equality (especially Lumumba, who was assassinated). Macchiavellistic Mobutu was the man who had clearly shown his aversion towards these "communists" (this is the era of the Cold War), and from being a mediocre journalist, he was propelled to becoming the leader of the immense country. With successful and ruthless military campaigns, he succeeded in keeping Congo united and relatively stable.

Less than a decade after his investiture, though, he surprised his Western masters by nationalising Congo's natural resources. The so-called "Zaïrianisation" (1973) ousted all foreign enterprises and brought the thriving economy under the guardianship of the state. Over the longterm, the move will prove to be disastrous.

All foreign enterprises were nationalised, except... Lever's plantations. Mobutu struck a deal with Unilever, because it was one of the most powerful forces in the country, employing tens of thousands of people. For the other agro-industrial companies, the Zaïrianisation simply meant that Mobutu's own friends took over the sector, and basically looted it. Loyal to the party, but totally incompetent when it comes to agriculture and running a business, they assured that the exploitation and production of palm oil and rubber came to a halt.

Rubber production right after the decolonisation (1960-65), under Mobutu, and before and after his "Zaïrianisation" policy.

In less than 5 years, the majority of the nationalised plantation companies ceased operations and went bankrupt, processing facilities and transport infrastructure decayed and was plundered - entire factories, railways and truck fleets were disassembled and their parts sold on the black market. Stocks to replace or repair the infrastructure were depleted and no policy or action was taken to halt the looting. The social consequences of the nationalisation were disastrous as well. In most of the plantations, the laborers were no longer paid, and mass unemployment was the result.

The economic decline could no longer be stopped and spiralled out of control. Attempts to de-nationalise the sector and to reinvite the former owners or new investors came too late: nobody dared investing in the country again. Moreover, several of Mobutu's own "barons" refused to hand back the capital and the production factors they were supposed to manage, even though they had become worthless anyways.

The agro-industrial palm sector's output declined from 84,500 tons in 1973 to 70,300 tons in 1978, more than a 20% decline, whereas in the previous decade it had seen a consistent growth of more than 20%. The internal trade in palm fruits saw a similar drop, from 43,300 tons in 1973 to 34,900 tons five years later.

The rubber estate sector faced a similar fate. Plantations were abandoned and left to decay, resulting in a steep drop in the productive hectarage. Whereas in 1960 around 64,000 hectares were managed, in the mid-1970s only 30,000 hectares remained, 10,000 of which were no longer exploited because of a lack of labor.

The decline and fall of the Mobutu regime
The ruthless dictator's nationalisation policy was formally ended in 1978. But the plantation sector never regained its former production level. Several factors were to blame: the nature of plantation operations itself meant that the sector would need several years to revitalise itself. Once a plantation goes in decline and is managed badly, it is very difficult to revive it - and in Congo, the plantations were left to decay for more than a decade. Destroying it and replanting it with new trees is the most radical, but sometimes the only option. A new plantation takes at least 5 years to establish. At that time, world prices for agricultural commodities had reached new lows, which delayed the revitalisation efforts more. Moreover, low copper prices in the 1980s meant that Zaïre was gradually edging towards total bankruptcy, which meant that the financial means to replant were non-existent, the logistical infrastructure and the processing centres could not be rebuilt. Finally, popular resistance against the regime was rising, and the resentment could be observed in all social sectors. Nobody wanted to cooperate any longer with the dictator and his clique. Since 1978, the plantation sector declined some 3% per annum, never to recover.

The decline could also be observed in the villages, where smallholders gave up climbing their trees to harvest nuts for export (the system of "obligatory planting" in villages had been continued under Mobutu). They kept their products to themselves and traded them on local markets. So even this contribution was in decline.
On the other hand, given that large-scale processing was no longer possible, the production of palm oil became an affair of artisanal processing. Small oil mills in villages, most of them manually driven, had now become the main production centres of Congo's once thriving palm oil industry. This situation persists until this very day.

In the early 1990s, the economic crisis reaches its highpoint, with the collapse of the Zaïre, the national currency. The hyper-inflation sparked riots in 1991 and 1993. Kinshasa gets sacked and the many expats who still resided in the country, leave for good. Everyone feels that the end of the Mobutu regime is near. Quick political reforms and the promise of the establishment of multi-party elections, do not turn the tide.

In 1996, a rebel army led by old revolutionary Laurent-Désiré Kabila, who, together with Che Guevara, had already attempted to overthrow the military regime in the 1960s, starts its conquest of the country and marches to Kinshasa. The troops of the Alliance des Forces Démocratiques de Libération du Congo (AFDL) progress rapidly and capture Kinshasa on may 17, 1997. The old dictator Mobutu, now sick and gripped by cancer, had fled the country and died anonymously in Morrocco. A new chapter in Congo's tumultuous history was opened.

Fadjay Kindela & Laurens Rademakers,
CC, Biopact, some rights reserved, 2006.

Dr Kindela is a physics professor teaching in Paris and Kinshasa. In 2005 he led a research mission to assess the state of the plantations and formulated strategies to revive them. This entire dossier, in French, can be found here: Etude des Filières Huile de palme et Caoutchouc – Rapport d’Etape I (Diagnostic – Analyse) [*pdf].

More information:

BBC documentary: Congo: White King, Red Rubber, Black Death (Peter Bate, Belgium, 2003).

Jules Marchal. Travail forcé pour l’huile de palme de Lord Leverhulme L’Histoire du Congo 1910-1945, tome 3. Editions Paula Bellings. 396 blz. - about the practises of Lever Brothers and Unilever in Congo.

Michael Taussig (1991), Shamanism, Colonialism, and the Wild Man: A Study in Terror and Healing - an anthropological account of colonialism and resource extraction (both in Congo and in Latin America).

Edmund Dene Morel, Red Rubber: The Story of the Rubber Slave Trade Flourishing on the Congo on the Year of Grace 1906 - the original book that launched the first modern human rights campaign against the cruel practises in the Congo.

Adam Hochschild (1999), King Leopold’s Ghost: A Story of Greed, Terror, and Heroism in Colonial Africa - bestselling history book on the red rubber era.

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Interview about 'third generation' biofuels

It has become common to divide biofuels into 'generations', depending on the crop or the conversion technology involved. 'First generation' biofuels consist of unmodified sugar, starch or oil crops being used to make ethanol or biodiesel, by utilizing the easily fermentable parts of the crop (in the case of ethanol) or by transesterifying seed oil. 'Second generation' biofuels rely on advanced bioconversion techniques, such as the enzymatic breakdown of ligno-cellulose to make ethanol. That way, much more biomass is available as a feedstock. In 'third generation' biofuels, the energy crops or the bioconversion agents (bacteria, micro-organisms) themselves have been bio-engineered in such a way that the bioconversion process becomes more efficient. For woody crops for example, the lignin structure may be altered so that it breaks down 'on command' and releases the sugars needed, much easier.

In its "Young Innovator" series, the MIT Technology Review has an interesting interview with Michael Raab, a 33 year old bioengineer who is working on such 'third generation' biofuels.

In the US, fuel ethanol is made almost exclusively from corn kernels, and it provides little more energy than raising, harvesting, and processing the corn consumes. Determined to help wean the world off petroleum, Michael Raab is putting enzymes into corn that will make it easier and cheaper to convert the entire plant--kernels, husk, stalk, and leaves--into ethanol. These proteins allow processors to break the complex carbohydrates that make up most of the corn plant into simple sugars that can be easily fermented into ethanol.

What is your company, Agrivida, doing?



How does this process improve ethanol production?

Will this process work on other plants?

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India's next focus: hybrids on biofuels

DNAIndia. The Indian government's national liquid biofuels policy foresees mandatory blending of petrol with ethanol from November 1 onwards. Experts feel that the next stage will be to make alternative fuels and hybrid technology for automobiles commercially viable, and congruent.

Ethanol suppliers, comprising distillers and sugar companies, have been forced to agree to competitive bidding when it comes to supplying ethanol to oil companies for 5% blending with petrol. "Ethanol, on an average, costs about Rs 21.50 a litre [€0.36 per liter / US$1.74 per gallon] which is what we are expecting the distillers to quote," says one oil company official.

Buyers such as Indian Oil Corporation and other oil refiners may not mind the price though issues of taxation on ethanol, considered industrial alcohol in states, still exist. When it comes to biodiesel, currently being produced from non-edible oilseeds for blending with diesel, taxation is little better.

As far as automobiles are concerned, 5% blending of both petrol and diesel with ethanol does not require any change in vehicle engines. Beyond that level, though, automobile companies in India have to modify engines. They have, by and large, expressed their inability to invest in hybrids vehicles that improve fuel efficiency, citing the government’s apathy towards such technologies.

Hybrid vehicles run on more than one fuel simultaneously, with one engine mostly comprising electrical batteries. The Society of Indian Automobile Manufacturers (SIAM) is making some efforts to lead the way in alternate fuels. It has signed a technology transfer agreement with its German counterpart Verband der Automobilindustrie for developing alternate fuel-powered vehicles such as hybrids:

Says SIAM secretary general Dilip Chenoy: “We in India need to acquire technology which not only makes our vehicles more fuel-efficient but also provides us alternatives to traditional fuels such as petrol.” He cites the example of diesel that is a more thermally efficient fuel. The agreement with VDA will give our vehicle makers access to some of the most advanced technologies in alternate fuels and hybrid vehicles.”

Not only diesel, some preliminary work on other alternate fuels is also being done. The managing director of Tata Motors, Ravi Kant, said his company had been conducting a pilot project for running buses on biodiesel.

The company is operating 40 such buses for ferrying its own employees within Pune. Besides, the company has launched vehicles which can get CNG kits retro-fitted besides sporting diesel/petrol engines. The SIAM-VDA pact comes at a time when a host of car makers (including market leader Maruti Udyog and Hyundai Motor India) are preparing to come up with diesel cars. Also, Mahindra & Mahindra has taken the lead in developing an indigenous hybrid vehicle, the first of which should be commercially available within the next 18 months.

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Nigeria to make ethanol use mandatory, cooperation with Brazil

Nigerian President Olusegun Obasanjo has said that his administration would make the use of ethanol in fuel compulsory. Speaking when the Director of the Sao Paulo Federation of Industries, Mr Roberto Gianneti da Fonseca, paid him a courtesy visit in Abuja, Obasanjo likened the situation to the compulsory use of cassava flour in wheat for bread.

“Like we did for the introduction of cassava flour into bread, we shall gradually introduce ethanol into fuel soon. This is a serious project for us. NNPC [Nigeria's national petroleum company] is spearheading the project for now; but it will essentially be private sector driven”, the president said.

He said that six states were ready to commence the project in their respective domains, including Jigawa, Bauchi, Benue and Ondo. “Nigeria has the capacity to produce ethanol from both cassava and sugarcane; so we will take advantage of these natural endowments to provide jobs and cheaper fuel,” he added.

Earlier, Fonseca had said his organisation was already talking with NNPC and some private Nigerian companies as part of the effort to introduce ethanol to the Nigerian market. Nigeria welcomes Brazilian technology, expertise and sugar cane varieties.

The announcement came after the NNPC and the University of Agriculture, Makurdi, in Abuja signed a consultancy service agreement in the area of research for high yielding cassava and sugarcane in the country, to take the national ethanol programme forward.

The Group Managing Director of NNPC, Engineer Funso Kupolokun, also disclosed that a limited ethanol importation programme is being planned to seed the market. To him, this will not only help to form up the market, it will also provide the necessary experience in distribution and handling of infrastructure for the distribution of ethanol fuel in collaboration with petroleum marketers:

The objective of the ethanol fuel programme he said was to explore sources of biomass that can be used to produce fuel ethanol to improve automotive exhaust omissions in the country and reduce use of petrol, free up more crude for export and position Nigeria for development of green fuel.

On the research agreement with the Federal University of Agriculture, Makurdi, he stressed that for the implementation of the programme to be successful, the services of experts from the university will be required from time to time.

He, however, believed that the consultancy agreement will enable the corporation to establish the framework and set out the principles with Federal University of Agriculture, Makurdi, which will provide technical assistance to NNPC on the Automobile Bio-Mass Ethanol programme.

According to him “the success of the bio-fuel programme is anchored on local availability of high quality feedstock in sufficient quantity from both out-growers and integrated plantations to feed the ethanol plants on a sustainable basis.”

Towards this, a detailed feasibility studies for locations in Gombe and Benue States and a preliminary seedling strategy has been developed to provide sufficient and improved varietal material for 20,000 hectares of sugarcane plantations in the two cities.

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Branson invests $400 million in biofuels

We already knew that Richard Branson was interested in biofuels, when he said that he thinks all his "Virgin" airplanes will fly on green fuels by 2020. But now the billionaire serial investor made his previous suggestions concrete and launched an investment fund for environmentally friendly fuels. Branson says the new "Virgin Fuels" business will invest up to $400m (€315.6m) in renewable energy initiatives over the next three years. With his biofuel initiative, he follows in the footsteps of Bill Gates, the Google Boys and Vinod Khosla.

The first deal saw Branson back California-based Cilion, which was formed in June and will make bioethanol from corn. Cilion plans to build seven plants by 2009 with a total of 440 million gallons per year capacity (roughly 20,000 barrels of oil equivalent per day). The first three ethanol plants are expected to be in California.

Branson said it was important that transport groups such as airlines and train operators were at the forefront of developing environmentally friendly fuels. Other investors in Cilion include Silicon Valley entrepreneur Vinod Khosla and Los Angeles billionaire Ron Burkle. California is on an environmental crusade led by state governor Arnold Schwarzenegger to produce more of its own biofuels, which it already uses to fuel cars.

Most of the fuel is imported from the American Mid West and earlier this year the actor-turned-politician called for California to make a fifth of the fuel it uses by 2010. Sir Richard said: “This is a very exciting investment for Virgin and the new company will make a substantial contribution to meeting Governor Schwarzenegger’s goal as stated in his recent executive order, calling for California to produce a minimum of 20% of its own bio-fuels by 2010.”

He added: “We do not intend to limit ourselves to US bio-fuels as we believe that transportation companies have a responsibility to lead and fund research and development of new bio-fuels that can be produed, distributed and used with greater positive environmental impact than the current technologies used in the production of bio-fuels. “This is only the beginning of our investment programme which begins in the US and will expand to the UK, mainland Europe and other parts of the world.”

More information:
Bloomberg, Branson to Invest $400 Million in Renewable Energy, Biofuels - Sept. 10, 2006.
The Guardian, Virgin pumps £214m into 'green' fuel initiatives - Sept. 10, 2006.
Irish Examiner, Branson launches $400m eco-friendly fund - Sept. 10, 2006.

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