Bangchak Petroleum has urged the government to put more effort into encouraging gasohol consumption in response to rising ethanol production capacity, its president Anusorn Sangnimnuan said.

He said the government should take the opportunity, now that the gasohol price is lower than the price of 95-octane petroleum, to increase gasohol use.

The National Energy Policy and Planning Office board announced the new ethanol price on February 5, which prompted a drop in the ethanol price to Bt19.30 per litre from Bt25.30 per litre.

As a result, the gap between the gasohol-95 price and the octane-95 gasoline price was further widened, seeing the former cheaper than the latter by Bt1.80 per litre, up from the previous Bt1.50 per litre.

"This has encouraged higher consumption of gasohol," Anusorn said.

He added that Bangchak planned to expand its number of petrol stations selling gasohol-91 to between 400 and 500 this year, from the existing 250.

However, several ethanol plants, which plan to or have already expanded their production capacity, are cautious about the domestic demand continuing to rise in line with their increasing production capacity.

It is not easy to export ethanol, given the complicated export procedure and the tough global market competition. "Therefore, the government should boost the domestic demand to absorb the planned increased supply of ethanol. It should also focus on promoting gasohol-91, which still has an ample room for growth when compared to gasohol-95," Anusorn added.

Bangchak is also interested in producing E20-gasohol - gasoline with 20-per-cent ethanol content - and it believes that it can offer the E20-gasohol at 30 satang per

litre cheaper than octane-95 gasoline.

Anusorn said the company realising its plan to produce E20-gasohol depended on the government's introduction of measures to encourage car-makers to produce or import E20-gasohol-operated vehicles.

"The government should not stop at gasoline with 10 per cent ethanol content, but should go further to promote sales of gasoline with a higher ethanol proportion to stimulate the demand for ethanol," he added.

He also hopes that the government will devise measures to widen the price gap between biodiesel and diesel in order to promote greater consumption of the former.

The price of biodiesel is slightly cheaper than diesel by 50 satang per litre. He added that its demand would be higher if the price gap was increased to Bt1 per litre.

To promote the alternative fuel this year, Anusorn said Bangchak aimed to have its 550 small gasoline stations operated by cooperatives countrywide promoting only the alternative fuel to benefit low-income consumers.

Talking about the trend of local retail oil prices, he

said there would be no adjustment this week, thanks to the appropriate level of the marketing fee, at Bt1.30 per litre for diesel and Bt1.50 per litre for gasoline.

Energy Reporters

The Nation