Central Asia's Vast Biofuel Opportunity

Comments ยท 69 Views

The recent discoveries of a International Energy Administration whistleblower that the IEA may have distorted crucial oil projections under intense U.S.

The current revelations of a International Energy Administration whistleblower that the IEA may have misshaped crucial oil forecasts under extreme U.S. pressure is, if true (and whistleblowers hardly ever come forward to advance their careers), a slow-burning atomic explosion on future worldwide oil production. The Bush administration's actions in pressing the IEA to underplay the rate of decline from existing oil fields while overplaying the chances of discovering brand-new reserves have the potential to toss governments' long-term planning into turmoil.


Whatever the reality, rising long term global needs appear specific to overtake production in the next decade, particularly provided the high and rising costs of establishing brand-new super-fields such as Kazakhstan's offshore Kashagan and Brazil's southern Atlantic Jupiter and Carioca fields, which will require billions in financial investments before their first barrels of oil are produced.


In such a circumstance, ingredients and alternatives such as biofuels will play an ever-increasing function by extending beleaguered production quotas. As market forces and rising rates drive this technology to the leading edge, one of the richest prospective production locations has actually been completely neglected by financiers already - Central Asia. Formerly the USSR's cotton "plantation," the region is poised to become a significant player in the production of biofuels if sufficient foreign financial investment can be acquired. Unlike Brazil, where biofuel is produced mostly from sugarcane, or the United States, where it is mostly distilled from corn, Central Asia's ace resource is a native plant, Camelina sativa.


Of the previous Soviet Caucasian and Central Asian republics, those clustered around the coasts of the Caspian, Azerbaijan and Kazakhstan have actually seen their economies boom since of record-high energy rates, while Turkmenistan is waiting in the wings as a rising manufacturer of natural gas.


Farther to the east, in Uzbekistan, Kyrgyzstan and Tajikistan, geographical isolation and relatively little hydrocarbon resources relative to their Western Caspian next-door neighbors have actually largely prevented their ability to capitalize increasing international energy needs up to now. Mountainous Kyrgyzstan and Tajikistan remain largely reliant for their electrical requirements on their Soviet-era hydroelectric infrastructure, but their heightened requirement to produce winter season electricity has caused autumnal and winter season water discharges, in turn severely affecting the farming of their western downstream neighbors Uzbekistan, Kazakhstan and Turkmenistan.


What these 3 downstream countries do have nevertheless is a Soviet-era legacy of farming production, which in Uzbekistan's and Turkmenistan case was mainly directed towards cotton production, while Kazakhstan, starting in the 1950s with Khrushchev's "Virgin Lands" programs, has ended up being a significant manufacturer of wheat. Based upon my conversations with Central Asian government officials, given the thirsty needs of cotton monoculture, foreign proposals to diversify agrarian production towards biofuel would have terrific appeal in Astana, Ashgabat and Tashkent and to a lower extent Astana for those durable investors ready to bank on the future, specifically as a plant native to the region has currently shown itself in trials.


Known in the West as incorrect flax, wild flax, linseed dodder, German sesame and Siberian oilseed, camelina is attracting increased clinical interest for its oleaginous qualities, with numerous European and American companies currently examining how to produce it in industrial quantities for biofuel. In January Japan Airlines undertook a historical test flight using camelina-based bio-jet fuel, ending up being the first Asian carrier to experiment with flying on fuel obtained from sustainable feedstocks throughout a one-hour demonstration flight from Tokyo's Haneda Airport. The test was the culmination of a 12-month evaluation of camelina's functional efficiency ability and possible business practicality.


As an alternative energy source, camelina has much to recommend it. It has a high oil content low in saturated fat. In contrast to Central Asia's thirsty "king cotton," camelina is drought-resistant and immune to spring freezing, requires less fertilizer and herbicides, and can be utilized as a rotation crop with wheat, which would make it of particular interest in Kazakhstan, now Central Asia's significant wheat exporter. Another bonus offer of camelina is its tolerance of poorer, less fertile conditions. An acre planted with camelina can produce as much as 100 gallons of oil and when planted in rotation with wheat, camelina can increase wheat production by 15 percent. A heap (1000 kg) of camelina will include 350 kg of oil, of which pressing can draw out 250 kg. Nothing in camelina production is squandered as after processing, the plant's debris can be used for livestock silage. Camelina silage has a particularly attractive concentration of omega-3 fatty acids that make it an especially fine animals feed prospect that is simply now gaining recognition in the U.S. and Canada. Camelina is fast growing, produces its own natural herbicide (allelopathy) and completes well against weeds when an even crop is established. According to Britain's Bangor University's Centre for Alternative Land Use, "Camelina could be an ideal low-input crop suitable for bio-diesel production, due to its lower requirements for nitrogen fertilizer than oilseed rape."


Camelina, a branch of the mustard family, is indigenous to both Europe and Central Asia and hardly a new crop on the scene: historical proof suggests it has actually been cultivated in Europe for at least 3 millennia to produce both grease and animal fodder.


Field trials of production in Montana, presently the center of U.S. camelina research, showed a large variety of outcomes of 330-1,700 pounds of seed per acre, with oil material differing between 29 and 40%. Optimal seeding rates have actually been figured out to be in the 6-8 lb per acre range, as the seeds' little size of 400,000 seeds per pound can develop problems in germination to attain an ideal plant density of around 9 plants per sq. ft.


Camelina's potential could enable Uzbekistan to begin breaking out of its most dolorous tradition, the imposition of a cotton monoculture that has warped the nation's efforts at agrarian reform because attaining independence in 1991. Beginning in the late 19th century, the Russian government identified that Central Asia would become its cotton plantation to feed Moscow's growing fabric market. The process was sped up under the Soviets. While Azerbaijan, Kazakhstan, Tajikistan and Turkmenistan were likewise purchased by Moscow to sow cotton, Uzbekistan in specific was singled out to produce "white gold."


By the end of the 1930s the Soviet Union had actually ended up being self-sufficient in cotton; 5 decades later on it had become a major exporter of cotton, producing more than one-fifth of the world's production, focused in Uzbekistan, which produced 70 percent of the Soviet Union's output.


Try as it may to diversify, in the absence of alternatives Tashkent stays wedded to cotton, producing about 3.6 million heaps yearly, which brings in more than $1 billion while making up roughly 60 percent of the country's hard cash income.


Beginning in the mid-1960s the Soviet federal government's directives for Central Asian cotton production largely bankrupted the region's scarcest resource, water. Cotton utilizes about 3.5 acre feet of water per acre of plants, leading Soviet coordinators to divert ever-increasing volumes of water from the area's two main rivers, the Amu Darya and Syr Darya, into inefficient irrigation canals, resulting in the dramatic shrinking of the rivers' final location, the Aral Sea. The Aral, once the world's fourth-largest inland sea with an area of 26,000 square miles, has shrunk to one-quarter its original size in one of the 20th century's worst eco-friendly disasters.


And now, the dollars and cents. Dr. Bill Schillinger at Washington State University recently described camelina's company design to Capital Press as: "At 1,400 pounds per acre at 16 cents a pound, camelina would generate $224 per acre; 28-bushel white wheat at $8.23 per bushel would amass $230."


Central Asia has the land, the farms, the irrigation infrastructure and a modest wage scale in comparison to America or Europe - all that's missing out on is the foreign investment. U.S. financiers have the money and access to the expertise of America's land grant universities. What is particular is that biofuel's market share will grow over time; less certain is who will profit of establishing it as a viable concern in Central Asia.


If the recent past is anything to go by it is unlikely to be American and European financiers, focused as they are on Caspian oil and gas.


But while the Japanese flight experiments indicate Asian interest, American financiers have the academic expertise, if they want to follow the Silk Road into developing a new market. Certainly anything that decreases water usage and pesticides, diversifies crop production and improves the lot of their agrarian population will get most mindful consideration from Central Asia's governments, and farming and grease processing plants are not only more affordable than pipelines, they can be built faster.


And jatropha curcas's biofuel capacity? Another story for another time.

Comments