Investment in the biofuels sector

1. INVESTMENT IN THE
BIOFUELS SECTOR
BIOFUELS IN COLOMBIA
In 2005, the National Government initiated policies oriented towards establishing
incentives for the production and use of biofuels in the country, with the goal of
promoting a productive development alternative for the formal use of the soil,
contributing to generating jobs, diversifying the offering of energy options in the
country and converting Colombia into an exporter of biofuels.
GROWTH, CONFIDENCE AND
OPPORTUNITIES TO INVEST
Libertad y Orden

2. RATE OF RETURN FOR ETHANOL
PRODUCTION (LT/HA/YEAR)
ETHANOL PRODUCTION
2005-2012 (THOUSANDS OF LITERS)
BIODIESEL PRODUCTION
2009-2012 (TONS)
RATE OF RETURN FOR BIODIESEL
PRODUCTION (LT/HA/YEAR)
A continuous increase in the production of biofuels will create a market for surpluses; Colombia will be able to supply the needs of other
countries where internal production is not sufficient and where the need for its use is growing.
Although the international trade in biofuels is not large and has exchange
barriers due to the existence of production subsidies, it is expected that in
the medium term it will grow, since many countries will not be able to meet
internal demand with domestic production.
2005 2006 2007 2008 2009
2009
2010
2010
2011 20112012
2012
The production of biodiesel and ethanol in Colombia has increased over
recent years thanks to the obligatory mixing policy. In 2012, 368 million
liters of ethanol and 489 thousand tons of biodiesel were produced.
Source: Fedebiocombustibles
27,034
265,684 255,584
327,705 337,398
369,722
271,773 291,286
169,411
337,713
443,037
489,991
SUGAR
CANE
BEETS
YUCCA
SWEET
SORGHUM
CORN 3,200
4,400
4,500
5,000
9,000
0 5,000 10,000
PALM OIL
COCONUT
CASTOR
AVOCADO
JATROPHA
COLZA
PEANUT
SUNFLOWER
SOY
5,550
4,200
2,600
2,460
1,559
1,100
990
890
840
0 2,000 4,000 6,000

3. MIXING POLICY: Diesel and gasoline sold in Colombia must
be mixed with biodiesel and ethanol. The amount of biofuels in
the mix would tend to increase over the years, depending on the
levels of supply and other variables. (Current mix: E8, B8 - B10).-
Fedecombustibles-2013). The mixing policy (map) could change
as result of an inter-sectoral biofuels mandate.
ESTABLISHMENT OF PRICES: The Ministry of Mines and
Energy establishes the prices for biodiesel and ethanol every
month. This price is one of the highest in the world. (Ministry
of Mines and Energy).
Based on the “Life Cycle Analysis, 2012”, the ethanol produced
in Colombia reduces GHG emissions by 74%, and biodiesel
reduces these levels by 83%. (EMPA and Universidad Pontificia
Bolivariana).
Palm oil and sugar cane used in Colombia for creating biofuels
have been proven to have higher yield than other raw materials
used around the world.
Once the domestic demand for biofuels is covered, any surplus
can be exported.
Source: National Federation of Biofuels
BIOFUELS
IN COLOMBIA
E0 - B0
E8 - B0
E8 - B8
E8 - B10

4. INVESTMENT OPPORTUNITIES
BUSINESS NETWORK
Five ethanol plants (in production): Incauca,
Ingenio Providencia, Manuelita (Palmira),
Manuelita (Candelaria), Ingenio Risaralda
and GPC.
The growing production of palm oil and
sugar cane requires the construction of
new bio-refineries, biomass plants and
development of transesterification, which
allow the transformation of sugar cane
and oil palm into biodiesel.
Colombian soil can be used for planting
crops aimed at biofuel production
(following a soil study).
Exports of biofuels to the United States
and the European Union under free trade
agreements are seen both as a challenge
and an enormous opportunity.
It is expected that the future demand for
biofuels in Colombia will be greater in
the next few years, to the extent that the
mixing policies are increased.
As a consequence, local demand will have
tobecoveredbyincreasingtheproduction
of ethanol and biodiesel.
Five biodiesel plants (in production):
Oleoflores, Biocombustibles Sostenibles
del Caribe, BioD, Ecodiesel de Colombia
and Aceites Manuelita.
Thirteen sugar mills and more than 50 palm
oil extraction plants.
5 5 13

5. BUSINESS NETWORK
BIODIESEL PLANT
ETHANOL PLANT
ETHANOL/
BIODIESEL PLANTS
Source: Fedebiocombustibles.
ETHANOL
REGION COMPANY CAPACITY (L/DAY)
Miranda, Cauca Incauca 350.000
Palmira, Valle Ingenio Providencia 300.000
Palmira, Valle Manuelita 250.000
Candelaria, Valle Manuelita 250.000
La Virginia, Risaralda Ingenio Risaralda 100.000
Pto López, Meta GPC* 25.000
TOTAL 1.275.000
BIODIESEL
REGION COMPANY CAPACITY (T/YEAR)
Codazzi, Norte Oleoflores 70.000
Santa Marta, Norte Biocombustibles
Sostenibles
100.000
Facatativá, Oeste Bio B 115.000
B/bermeja, Central Ecodiesel de Colombia 115.000
San Carlos de Guaroa,
Meta
Aceites Manuelita 120.000
TOTAL GPC* 520.000

6. LARGE FOREIGN COMPANIES HAVE CHOSEN
COLOMBIA AS A PLACE TO INVEST
MERHAV (ISRAEL):has invested in the development of an
ethanolproductionprojectinthenorthernpartofthecountry.
M I T S U B I S H I C O R P O R A T I O N ( J A P A N )
formalized its entrance into fuel alcohol production in Colombia
via the purchase of BioOriente’s share in BioEnergy, a company
that is building the largest fuel ethanol distillery in the country.
PROGRAM FOR PRODUCTIVE
TRANSFORMATION:
public-private alliance that promotes
productivity and competitiveness in
sectors with high export potential, by
means of more efficient coordination
betweenthepublicandprivatesectors.
FEDEBIOCOMBUSTIBLES:
the National Federation of Biofuels
is a non-profit organization that
gathers together leading entities
willing to work in the service of the
Nation for converting the biofuels
sector into means of leveraging
wealth in regions where industrial
centers are established.
PROCOLOMBIA:
the entity in charge of promoting
international tourism, foreign
investment and non-traditional
exports in Colombia.
INTER-SECTORAL
COMMISSION FOR BIOFUELS:
responsible for biofuel policy
management. It is made up of the
Ministry of Agriculture and Rural
Development, the Ministry of
Mines and Energy, the Ministry of
the Environment and Sustainable
Development, the Ministry of
Transportation, the Ministry of
Commerce, Industry and Tourism, and
the National Department of Planning.
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