Another major Jatropha project suffers setback

By Emmanuel K. Dogbevi

Another Jatropha biofuel project initiated by D1 Oils Plc has suffered a jolt as a major investor pulls out.

Reports reaching ghanabusinessnews.com from the US say, Europe’s second largest oil company BP Plc intends to exit its Jatropha biofuel project with D1 Oils Plc. BP, according to the reports is exiting the Jatropha project to focus on ethanol production in Brazil and the US and also to advance biobutanol development.

As a result of BP’s withdrawal, D1 agreed to acquire its 50% interest in their joint venture D1-BP Fuel Crops Ltd. venture which was set up in June 2007 to develop Jatropha. Jatropha is a drought-resistant tree whose seeds contain oil that can be used in biodiesel production.

The deal came to an end when the two companies failed to get a third investor for the project. The two began talking about dissolving the venture this year and bringing planting and plant-science operations under D1’s control.

BP and D1 had planned to plant 1 million hectares of Jatropha over four years, of which 220,000 hectares had been planted by April.

BP Alternative Energy earmarked $8 billion for the project investment in the decade through 2015. BP, which expects biofuels to account for 11 percent to 19 percent of the world’s transport-fuel market by 2030, supplied about 10 percent of global biofuels last year, according to company estimates.

London-based D1 however said it would be able to maintain the business at lower cost until market conditions allowed the injection of new capital.

This is the second time D1’s investments in Jatropha to produce biofuels has not gone well.

An ambitious Jatropha project in India involving 22 agribusiness colleges failed to yield projected targets, leading to disappointments and disillusionment.

The argument has been made that Jatropha would grow on wasteland or marginal land, but Indian researcher, Dr Suman Jha who worked on the D1 project disagrees. He says, “this is not a wasteland crop. It needs fertiliser, water and good management. Yes, it grows on wasteland, but it doesn’t give you any yield.”

D1 Oils planted about 257,000 hectares of Jatropha, mainly in India but it was unsuccessful and the company was compelled to move far too early.

For instance in 2006 D1 aimed to produce 2.7 tonnes of oil per hectare from areas planted with its new E1 variety, and 1.7 tonnes of oil from normal seed. That is equivalent to about 8 tonnes and 5 tonnes of seed per hectare respectively, or 3.5kg and 2kg a plant. But according to Pradip Bhar, who runs the company’s D1 Williamson Magor Bio Fuel joint venture in India’s north east, admits he has yet to achieve a fraction of that.

“Hitting 500g is the challenge,” he says. “Mortality is quite high. But if we can reach 500g in two years’ time, after that the bush will continue to grow. Our expectation is that after the fourth year we will hit 1kg. The 1.5kg mark we haven’t touched as yet.”

There has been consensus that the Indian experiment had been unsuccessful.

Meanwhile, in Ghana some biofuels companies who have announced investments in Jatropha to produce biofuels have been making projections that are yet to be seen.

Gold Star Farms Ltd. claims it intends to cultivate five million acres of land to plant Jatropha for the production of biofuels for export.

One of the company’s executives, Mr. Jack Holden has said that it has commitments from farmers to grow the crop on approximately five million acres of land in Ghana.

The company, he added, plans to begin producing biodiesel at its facility in Nkawkaw, in the Eastern region of Ghana, in 2009. It is July 2009, and it is not yet known if the company has produced its first litre of biofuel from Jatropha.

Another biodiesel company, Green Fuels Biodiesel which revived silos abandoned in Ghana for 43 years for its operations recently said it is investing in the multi-million cedi project to produce biodiesel from Jatropha seeds later in the year.

The Managing Director of Green Fuels, Mr. Joseph Karam, told the Daily Graphic newspaper that the initiative would contribute significantly towards reducing the importation of biodiesel and grease into the country.

According to him, “there is the potential to produce quality biodiesel from Jatropha, instead of spending huge sums of money to import these products, we can produce them here.”

He said 500,000 litres of biodiesel would be produced a day for the local market.

There is certainly a potential for Jatropha as a biodiesel source, but why it is recording failures rather than successes needs to be critically looked into.

There is need for sober reflections and investments in R&D to determine the full potentials of Jatropha as a viable, cost-effective and efficient non-food crop for biofuels.

Source: www.ghanabusinessnews.com

Is the UK serious about halting e-waste dumping in Ghana?

By Emmanuel K. Dogbevi

The British colonized Ghana for many years, and succeeded in building their economy with Ghana’s natural and human resources. But now they have turned Ghana into a dumping ground for their out of use electronics equipment.

It is known that electronics waste or e-waste contains a dangerous cocktail of poisonous chemicals that pose grave dangers to human life and the environment.

It is therefore, hard to understand why citizens of an advanced country, with all the wealth and resources to handle the e-waste that they have generated instead chose a poor and struggling country like Ghana to dump.

There is now overwhelming evidence that the UK has turned Ghana into a dumping ground for its e-waste. Earlier investigations by British journalists found damaged computers at the Agbogbloshie dump site in Accra with labels of the National Health Service (NHS). Some other computers with NHS labels were also found to be on sale at secondhand electronics equipment dealers’ shops in Ghana’s capital Accra.

Some PCs were also found to have come from UK local councils and universities, including Kent County Council, Southampton County Council, Salford University and Richmond upon Thames College (RUTC) and recently, a Ministry of Defence computer has been found.

On February 18, 2009 authorities in the UK arrested a man over the export of e-waste into developing countries. The 46-year-old man was not named but he was identified as from West Sussex. The countries he was exporting the e-waste to were never mentioned, and he was released on bail until May 5, 2009. Nothing is known yet about his prosecution.

The Independent, a UK newspaper did a report based on investigations it has conducted which revealed that despite ongoing investigations in the matter, toxic wastes from the UK continue to be dumped in Ghana and Nigeria.

The report says tonnes of toxic waste collected from British municipal dumps are being sent illegally to Africa in flagrant breach of the country’s obligation to ensure its rapidly growing mountain of defunct televisions, computers and gadgets are disposed of safely.

Hundreds of thousands of discarded items, which under British law must be dismantled or recycled by specialist contractors, are being packaged into cargo containers and shipped to countries such as Nigeria and Ghana, where they are stripped of their raw metals by young men and children working on poisoned waste dumps, the report said.

According to The Independent, in a joint investigation it carried out together with Sky News, and Greenpeace, they found that a television set that had been broken beyond repair was tracked to an electronics market in Lagos, Nigeria, after being left at a civic amenity site in Basingstoke run by Hampshire Country Council.

The publication remarked that under environmental protection laws of the UK, the TV set was classified as hazardous waste and should never have left the country.

In the face of these evidences, the UK Environment Agency (EA) initiated investigations into the matter. In personal correspondence I have hard with the EA in October 2008, The Senior Press Officer responsible for environment protection, Scarlett Elworthy admitted to me by email that the EA was investigating the incidents of e-waste dumping into Ghana. She promised, “I will be happy to provide you with an update once the investigation has concluded.”

It appears while the investigation has been ongoing since last year, the dumping continues. While it does, I have made persistent enquiries at the UK Agency, but have received no information as they keep telling me their investigation team is still investigating the matter.

If the UK authorities fail to act to stop their citizens who obviously are doing these together with some Ghanaians, our Ghanaian authorities should act.

The situation of e-waste in Ghana is grave – as human life and the environment are endangered.

After Obama's Ghana visit, would American investors come?

By Emmanuel K. Dogbevi

President Barack Obama left Ghana Saturday night July 11, 2009, but the ripples of his visit still reverberate throughout the country and indeed the entire world. But one question that lingers on our minds at ghanabusinessnews.com is: would the historic visit serve as an encouragement to American investors to come to Ghana?

Available data shows that US businesses are not investing as much as they should generally in Africa and in Ghana in particular. A study that was published on May 20, 2009 by the US Chamber of Commerce says American businesses are not encouraged to invest in Africa for reasons among which are corruption, lawlessness, unstable governments and inadequate infrastructure.

Indeed, in President Obama’s speech to Ghana’s Parliament Saturday July 11, 2009, he specifically touched on the issues of corruption as a bane to development not only in Ghana, but the entire continent. He said: “Repression takes many forms, and too many nations are plagued by problems that condemn their people to poverty. No country is going to create wealth if its leaders exploit the economy to enrich themselves, or police can be bought off by drug traffickers.”

Adding, “no business wants to invest in a place where the government skims 20 percent off the top, or the head of the port authority is corrupt. No person wants to live in a society where the rule of law gives way to the rule of brutality and bribery. That is not democracy, that is tyranny, and now is the time for it to end.”

As a matter of fact, several studies conducted in Ghana by anti-corruption institutions over the years show the police as corrupt. The political institution has also been cited in surveys as being corrupt. Political corruption in Ghana has even been nicknamed “kickbacks”.

Another study published by the Bank of Ghana on foreign direct equity investments in Ghana also shows that Europe and not America is the leading investor in the country.

The highlights of the survey, shows Europe as making the highest foreign direct equity investments (FDEI) to Ghana representing 60.7%., while investments from the African continent consist of 38.0%.

America places fifth among the top ten investor nations in Ghana. According to the report, the top ten sources of FDEI inflows in 2007 were Mauritius, 27.9%; France 19.4%; British Virgin Islands 18.4%); United Kingdom 16.9%; United States 5.9%; Togo 3.4%; Norway 3.3%; Israel 3.2%; Nigeria 2.1%, and Switzerland 1.9%.

The US Chamber of Commerce study is titled ‘The conversation behind closed doors: Inside the Boardroom: How Corporate America Really views Africa’.

The Chamber is also the world’s largest business federation with a membership of more than three million businesses and organizations of every size, sector and region as well as 112 affiliates in 99 countries around the world, making the Chamber a crucial source of investment in any country.

Despite the enthusiasm and hope that heralded the institution of the African Growth and Opportunities Act (AGOA) on May 18, 2000 to offer “tangible incentives” for African countries to open their economies and build free markets, not many American businesses as expected are doing business in Ghana.

To the extent that reports indicate that Ghana’s exports to the US under the AGOA fell in 2008 and continued to fall into the first quarter of 2009.

Ghana’s total exports under AGOA to the US market stood at US$42.2 million in 2008, a 38.4 percent decline from the US$68.6 million recorded in 2007.

From January to March this year, the country’s total value exported under the scheme was US$2.5 million, representing a momentous 86 percent decline over the US$18.1 million recorded in the first quarter of 2008.

The US Chamber of Commerce cited some of the following reasons for not investing in Africa; the image of lawlessness, corruption, unstable governments, an inadequate infrastructure, uneducated or untrained people, and an unwelcoming government attitude toward business.

Hopefully, President Obama’s visit to Ghana, which he clearly said was his endorsement of the country’s democratic culture and stability, would change the perception and spur some more US businesses to enter Ghana and invest.

These businesses would be joining other major US investors like Coca-Cola, Newmont Mining, Lehman Brothers, CMS Energy and Cargill.

American investors can look at the following areas; aerospace/defense, agribusiness, consumer goods, health care and information and communications technology.

The others could be infrastructure, media, petrochemical/extractive, pharmaceutical and transportation.

Tema Oil Refinery to go into biofuels production

By Emmanuel K. Dogbevi

Ghana’s only oil refinery, the Tema Oil Refinery (TOR) intends to go into the production of biofuels in the next 18 months, in anticipation of the phasing out of conventional oil, its acting Managing Director has said, according to a GNA report.

Dr Kwame Ampofo, then stressed on the importance for African refiners to shift their focus from conventional fuels to biofuels so that they will be in a better position to satisfy the international market.

He argued that other countries are gradually focusing on biofuel, making it important for African refiners to go into its production. “It is renewable and regenerates itself,” he said.

Dr. Ampofo said these Thursday July 2, 2009 when he addressed the opening of a two-day meeting of heads of laboratories of oil refineries in Africa in Accra.

The meeting was organized by the Africa Refiners Association (ARA) in collaboration with TOR for 45 participants in the refineries from 10 African countries including Ghana.

The meeting, which is a follow up to a previous one held in Dakar, is aimed at reviewing discussions and mapping up strategies for the way forward.

Dr Ampofo warned that should African refineries fail to go into the production of biofuels they would lose their relevance when the use of conventional fuel finally fades out.

He said plans were underway to integrate TOR into the production of biofuels and that even though TOR has the staff to go into the production it would be fully ready to do so within 18 months.

Dr Ampofo said most economies would be consuming up to 50 percent of energy generated from petroleum in the next decade and the proper management of the sector would determine the future of the economy and appealed to refineries to come out with quality products to meet modern standards.

The global food and economic crisis, coupled with the global energy crisis is pushing most countries into considering alternative energy sources as the way out. Biofuels have been identified as the most appropriate alternative energy sources, but not without the attendant challenges that these pose.

For instance, the Guardian newspaper in London in July 2008 published a leaked World Bank report which says biofuels have forced global food prices up by 75% – far more than previously estimated. Indeed, the report was a sharp contradiction of the US government’s claims that biofuel contributes less than 3% to the food crisis.

In May 2008, the UN’s top adviser on food security, Olivier de Schutter made a scathing criticism against the investments that are being made in biofuels by some countries. In an interview with the BBC, he described the investment in biofuels as “irresponsible”, but his predecessor in the job, Jean Ziegler, had condemned biofuels as a “crime against humanity” and called for an immediate ban on their use. He went ahead to call for an immediate freeze of the policy and asked for restraint on investors whose speculation he says is driving food prices higher.

The World Bank report, however, pointed out that biofuels derived from sugarcane, which Brazil specializes in, have not had any dramatic impact on food prices.

The IMF Country Director in Ghana, Arnold McIntyre, had said at a World Bank Dialogue Series in Accra, Ghana, that countries are turning to biofuels in response to current global fuel crisis, adding that by 2005, the US overtook Brazil as the largest producer of ethanol. In the EU, he said, Germany is the largest producer of biofuel.

He added that, biofuel production in the US which is corn based, is less cost effective than the sugarcane based in Brazil. He therefore, called for policy change to address biofuels production and suggested that it is necessary to do more research in second generation biofuels production.

Currently, in Ghana over twenty companies say they are investing in biofuels, some are into the cultivation of Jatropha. But available evidence suggests that not much is known about the full potential of Jatropha as an alternative energy source. Indeed, the experience of India has shown that the crop does not yield as much as it has been said to.

The government of India announced a scheme to plant 13 million hectares, enough to generate nearly 500,000 barrels of Jatropha oil per day.

But as the country’s major investment in Jatropha neared its end, it was discovered that there was no yield. “While the literature said that with dry land, after four years’ growth, you can get a yield of 1kg per plant. For us, it is hardly 200g per plant,” said Professor R. R. Shah, Navsari Agricultural University’s dean of agribusiness, one of the 22 agribusiness colleges involved in the Indian project

D1 Oils, a London-listed biofuels company also planted about 257,000 hectares of Jatropha mainly in India, but it was unsuccessful.

The current global energy crisis makes the temptation to jump onto any bandwagon promoting any kind of alternative energy source stronger, but it is necessary to be careful.

Countries should invest in Research and Development until there is enough scientific evidence that would justify any appreciable investment in biofuels,because the evidence that biofuels both food crops and non-food crops are responsible for the current global food crisis is overwhelming.

The use of food crops like corn or soy for biofuels production impacts on the world, just as the cultivation of non-food crops like Jatropha which would be competing for arable land for food crops.