PETROJAM ETHANOL LIMITED is a wholly owned subsidiary of Petrojam Limited which is a subsidiary of the Petroleum Corporation of Jamaica a statutory body of the Government of Jamaica. The business office is located at the Petrojam Limited Refinery compound at 96 Marcus Garvey Drive in Kingston Jamaica. The company’s primary involvement is in the procurement of ethanol feedstock (hydrous alcohol), the dehydration process to fuel ethanol (anhydrous alcohol) and the marketing of fuel ethanol in the United States or other markets. The dehydration facility was established in 1986 but started consistent operations in 1990 when ethanol feedstock became available through the European Commission (EC). The plant has a capacity of 41.8 million US gallons per year but has been mothballed since 1997. The company is presently in the process of modernizing and rehabilitating the plant to its current capacity. Production is expected to resume within the 1st quarter of 2005.


Ethanol is a renewable fuel currently made from abundant agricultural and biomass feedstocks. It is an alcohol-based alternative fuel produced by fermenting and distilling starch crops that have been converted into simple sugars. The feedstock (hydrous alcohol or wet ethanol) for this fuel contains a larger proportion of water and is produced from a range of agricultural products including sugar cane, corn and grapes. Ethanol can also be produced from "cellulosic biomass" such as trees and grasses and is called bioethanol.

The fuel grade ethanol (Anhydrous Alcohol or dry ethanol) contains no more than 0.5% water. It is used as an octane enhancer for motor gasoline.

In the U.S., ethanol is primarily from the starch in grains such as corn and grain sorghum through a fermentation and distillation process that converts sugars to alcohol. In Brazil, ethanol is primarily from sugar cane through the same process that converts the sugars to alcohol. On average, 2.7 gallons of ethanol are produced from a bushel of corn and 85 litres (22.5 gallons) of ethanol are produced from a ton of cane. The production process is extremely efficient, resulting in a positive fossil energy gain.


Ethanol is most commonly used to increase octane and improve the emissions quality of gasoline. In some areas of the United States, ethanol is blended with gasoline to form an E10 blend (10% ethanol and 90% gasoline), but it can be used in higher concentrations such as E85 or E95. Original equipment manufacturers produce flexible-fuel vehicles that can run on E85 or any other combination of ethanol and gasoline.

Ethanol’s high octane content helps your car run more smoothly. Ethanol keeps a car’s fuel system clean for optimal performance.

• Gasoline blended with up to 10% ethanol is approved under the warranties of all auto manufacturers marketing vehicles in the U.S. Many even recommended ethanol because of its clean air benefits. Approval of ethanol blends is found in the owners' manuals under references to refueling or gasoline.

• Ethanol-blended fuels can also be used in your yard care equipment, motorcycles and boats.


Ethanol is one of the best tools we have to fight air pollution from vehicles. Ethanol contains oxygen, which improves fuel combustion and reduces exhaust emissions.

• Ethanol reduces carbon monoxide, volatile organic compounds, toxics and fine-particulate emission that pose a health threat, particularly to children and seniors.

• Adding ethanol to gasoline displaces toxic gasoline components.

• Ethanol is quickly biodegradable in surface water, groundwater and soil.

• As a renewable fuel ethanol helps reduce emissions of greenhouse gases that contribute to global warming.

• Ethanol helps to reduce pollution from “gross polluters,” which are responsible for more than half of all vehicle emissions while making up only 10% of the vehicle fleet.


Ethanol has gained popularity in recent years as the preferred octane booster for gasoline blending in North America and several other regions of the world. This has followed a phase-out of lead as an additive due to its polluting effects in areas of high population and motor car density, particularly in the United States of America.
In Jamaica, several pre-conditions exist to encourage the production of ethanol. Sugar cane, one of the crops from which ethanol can be produced, is widely grown in Jamaica and other Caribbean territories. The technology and skilled manpower are available.
In 1984, ethanol was included in a list of commodities for which duty-free access to the United States was allowed under the Caribbean Basin Initiative. The then stated intention of the U.S. legislation was to facilitate Caribbean economic development by allowing duty-free access to the U.S. for certain commodities produced in the Caribbean, provided that there was at least 35% value added to the commodity within the Caribbean. This meant that Caribbean ethanol can enter the United States without paying the present US$0.54 per gallon import duty.


In 1985, Petrojam Ethanol Limited decided to take advantage of this opportunity and developed plans to establish an ethanol plant on its Kingston refinery site. Construction of the plant was completed in 1986 and it began operation in 1987, utilizing ethanol feedstock sourced in the Caribbean, Europe and Brazil.

To ensure an adequate supply of Caribbean sourced feedstock, two initiatives were taken. In 1985, Petrojam's parent corporation, the Petroleum Corporation of Jamaica (PCJ) acquired the Bernard Lodge sugar factory which was slated for closure. The factory was rehabilitated where fermentation and distillation facilities were installed with the capacity to produce some 15 million gallons of hydrous ethanol each year for use by the Petrojam Ethanol facility.

In 1986, the CBI legislation was modified to require more CBI sourced feedstock than Jamaica could produce. Petrojam then identified a recently closed sugar factory at Libertad in Belize, with a capacity similar to that at Bernard Lodge, and having access to abundant sugar cane production capacity.

Petrojam leased the Libertad factory for five years initially with a purchase option, and undertook a program of growing sugar cane and making high grade molasses. The operation commenced in 1989 and continued until 1997.

Originally at Petrojam, the feedstock was processed in dehydration facility consisting of two plants with a combined capacity of 52 million gallons of ethanol per year. The first plant, purchased from Conger in Brazil, was installed in 1985, and has an annual capacity of 10 million gallons. The second plant, purchased from APV in the United States, was installed in 1986 and has a capacity of 42 million gallons per year. Both plants have similar operating conditions, using azeotropic distillation.

Currently, the Conger plant is obsolete and the APV plant has been mothballed since 1997 because of inefficiencies in production and environmental concerns from the use of benzene. However, Petrojam Ethanol maintained its stake in the ethanol business through a fobbing and tolling arrangement with ED&F Man, a commodity trading company from Europe, which owns and operate the two ethanol dehydration plants in Rockfort, Kingston. The source of the feedstock for this existing arrangement is the European Commission (EC) under a tendering system for surplus wine alcohol. The volume which Petrojam is able to access under this arrangement is limited to approximately 5 million US gallons per year and the entire supply has recently been discontinued as Europe is now developing their own biofuels programme.


Petrojam Ethanol being a processor of ethanol in Jamaica qualifies under the Caribbean Basin Economic Recovery Act (CBERA) of 1983, for the exemption of duty in the exportation of fuel grade ethanol into the USA. The USA market for ethanol has grown significantly over the past few years and with New York, Connecticut and California banning MTBE in January 2004 along with the pending Renewable Fuels Standards (RFS) from the passing of the US Energy Bill that is currently in US Congress, the market is poised for continued significant growth over the next few years. At present the quota into the USA market for ethanol from countries under the CBERA is projected at about 200M USG per year of which only about 50% was exported in 2003.

As a result, Petrojam Ethanol sought to identify reliable sources of feedstock at competitive prices in order to economically rehabilitate the dehydration plant. Since Brazil is among the highest producers of alcohol in the world today, it was advantageous that Petrojam Ethanol establish a strategic alliance with potential investors/operators that will provide access to a reliable source of feedstock preferably from Brazil where there is an abundant supply of sugar cane.
Plans are in now in place to resume production of fuel grade ethanol by the first quarter of 2005 using feedstock initially from Brazil and later from domestic production

The rehabilitation project will include the following:

• Finding reliable feedstock sources
• Source Financing
• Modernization of the dehydration technology from the azeotropic
  (benzene) process to molecular sieve
• Construction of the new plant
• Installation of additional storage tanks and pipelines
• Installation of a cooling water system

Utilities such as electrical power, water supply, steam and dry compressed air will be sourced from the parent company Petrojam Limited. The Petrojam Limited dock facilities will be used for making ethanol shipments.


• Molasses or cane-juice is first fermented using yeast to produce mash containing 7-10% by volume ethanol.

• This mash is then distilled using steam to produce rectified spirit (hydrous ethanol) having about 5% by volume water in it.

• This rectified spirit is further dehydrated either by distillation or by PSA (MSDH) techniques.


  • Azeotropic Distillation
  • Extractive Distillation
  • Membrane Separation
  • Molecular Sieve Dehydration

    Azeotropic Technology:

    • Uses benzene or cyclohexane
    • High energy usage
    • Traces of entrainer in product
    • Complex installation and operation

    Why Molecular Sieve Technology:

    • Lower operating cost
    • No external chemical required making the product suitable for:
      • Pharmaceutical Grade
      • Perfumery Grade Alcohol
    • Highly automated plant
    • High alcohol recovery

Molecular sieve dehydration technology utilizes micro-porous particles such as alumino-silicates, processing a very precise pore size. The pores make it possible to separate small molecules form large ones through selective adsorption. For example, ethanol dehydration is accomplished with molecular sieves which have a diameter of 3Å, which entraps water molecules which have a diameter of 2.5Å. Ethanol molecules which have a diameter of 4Å cannot enter and therefore flow around the material.

Ethanol is member of a class of compounds termed oxygenates, demonstrated by the U.S. Environmental Protection Agency to reduce urban pollution when blended with gasoline. Up to 10% oxygenate blends are being recommended. It is projected that the demand for ethanol will increase sharply as more and more regions of the United States, and further a field, mandate the use of oxygenates in gasoline blends.

With the continued efforts from several countries around the globe to develop their own biofuels programme, it will only be a matter of time before Jamaica complies with this international standard and launches a programme to ban MTBE and introduce ethanol as the replacement in gasoline. To this end, there are many opportunities available for the Sugar Industry in the development of this programme. Some potential benefits are as follows:

1. Opportunity to rehabilitate the Bernard Lodge alcohol distillery to produce hydrous alcohol from sugar cane for further dehydration at the Petrojam Ethanol plant for use in the domestic market or for export.

2. Upgrade other local sugar factories to produce hydrous alcohol either from molasses or directly from sugar cane.

3. Expand the local sugar cane production to meet the requirements of the ethanol plants. This will provide opportunities for increased investment in the Sugar Industry which should in turn provide opportunities for increased employment.

The ethanol feedstock (anhydrous alcohol) requirement for the introduction into motor gasoline is estimated at 15 million US gallons per annum. Based on this demand, it is understood that for Jamaica to produce all of the feedstock it will require a minimum of 9,000 hectares (90M sq. meter) of sugar cane farm lands. The primary supply of the feedstock (hydrous alcohol) could therefore be sourced from the local Sugar Industry and if there is a shortfall, this can be supplemented with imports from countries like Brazil. A study is therefore necessary to assess the state of the Sugar Industry as it relates to meeting the additional demand for alcohol production and the investment that will be necessary to achieve these objectives.


Primary Market

The United States market has been targeted for Jamaican ethanol in the short term. In 2004 the demand for fuel grade or anhydrous ethanol was estimated to be in excess of 3 billion gallons per year.

The US ethanol market has moved from an oversupply situation early in 2003 to a position of undersupply over the past months as a result of increased demand from California, New York and Connecticut, because of the MTBE bans in those states since January 1, 2004. The oversupply was due mainly to the construction of several new ethanol plants or the expansion of existing plants in 2001 and 2002 in response mainly to the California MTBE ban which was predicted to take effect in 2003 and which was expected to significantly increase the demand for ethanol.

According to the weekly Renewable Fuels News, the year 2002 saw US ethanol rack prices averaging just over US$1.00/USG, while in 2003 the prices jumped from a January average of about US$1.20/USG to US$1.31/USG in February. Throughout the rest of the year the US average prices rose steadily from a low of US$1.10/gallon in May to US$1.73/gal in December just 2 cents/gallon short of the all-time high of US$1.75/gallon. Since January 2004, the US average prices have been fluctuating from a low of US$1.36/USG to a high of US$1.92/USG.

Notwithstanding, ethanol production has been on the rise in the US as production rates have reached an all-time high of 210M gallons per month and with the continued growth of the market, there will soon be 100 fuel ethanol plants across the US.

In 2002 the industry grew by 14% with the US being the primary contributor at a growth rate of 9%. With California banning MTBE since January 2004 and the prohibition likely to follow in most north eastern states along with the Renewable Fuels Standards (RFS) from the Energy Bill, there will be sufficient driving force to maintain the growth rate up to 2012. The language in the final energy conference draft of the Energy Bill included a renewable fuel standard (RFS), requiring 3.1 billion gal/year of renewable fuels in gasoline starting 2005 and to increase to 5 billion gal/year by 2012.

Other Market

The European markets are also possible targets for ACP countries in due course as this group is exempted from duty into Europe, while for Brazilian ethanol into Europe there is duty of approximately US$0.44/gallon (denatured) and US$0.84/gallon (undenatured).

Included in the European Import Regulations is a directive for all biofuel imports into the European Union (EU). To this extent, standards are being developed which will govern all imports and effective January 1, 2005 the EU requirements for ethanol in gasoline will be 2% of sales and is expected to increase to 5% of sales by January 1, 2010. The German market was launched in January 2004 and the governing standards have already been developed and accepted.
In the long term, demand for lead-free additives and for environmentally benign octane enhancers combined with expected modification of the CBI legislation, should ensure the marketability of Caribbean ethanol.

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