European investors delay Africa biofuels projects

by Shapi Shacinda

European investors have delayed projects for producing biofuels in African nations due to uncertainty over land tenure and lower oil prices, a senior official of a regional political bloc said recently.

Geoff Stiles, technical advisor on biofuels for the 15-member state Southern African Development Community (SADC), said the investors, who he declined to name, who had partnered with oil firms to produce biodiesel from jatropha, had suspended two projects in Zambia and Tanzania.

Jatropha is a non-food crop whose seeds yield oil.

"We are not saying they are not going to do it, but...they are only going to do it as soon as the policy environment, financial incentives that are available and the world financial situation becomes clearer," Stiles said in an interview at a biofuels conference in Midrand, South Africa.

"And these (investors) often have paired with big oil companies like Shell and BP, to do large scale jatropha development," Stiles said.

He said only South Africa and Mozambique had developed national strategies, which target large-scale production of biofuels and include plans to raise the economies of rural communities.

Brazil has said careful planning can ensure biofuels bring jobs, revenue and home-grown energy to African countries without gambling with food security.

But governments, including South Africa's, the continent's largest economy, fear that without proper strategies this could cause food insecurity.

Stiles said African countries needed to raise maize production so that the surplus could be used in producing bio-diesel and that African nations were not far from producing biofuels.

"I would say in the next year we will begin to see bio-diesel production primarily from small to medium scale jatropha (growing) ... and may be from sunflower and from palm oil, there is a lot of interest from that," Stiles said.

Stiles said the SADC would provide policy guides to its members to help them start bio-ethanol projects, mainly using sugarcane, although smaller projects have been going on for the last 25 years in Malawi and Zimbabwe.

Reuters