Central Asia's Vast Biofuel Opportunity

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

The recent discoveries of a International Energy Administration whistleblower that the IEA may have misshaped crucial oil projections under extreme U.S. pressure is, if true (and whistleblowers seldom step forward to advance their professions), a slow-burning atomic explosion on future international oil production. The Bush administration's actions in pushing the IEA to underplay the rate of decrease from existing oil fields while overplaying the chances of discovering new reserves have the potential to throw federal governments' long-lasting preparation into mayhem.


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


In such a scenario, ingredients and substitutes such as biofuels will play an ever-increasing function by stretching beleaguered production quotas. As market forces and rising rates drive this innovation to the leading edge, among the richest possible production areas has been absolutely neglected by financiers up to now - Central Asia. Formerly the USSR's cotton "plantation," the area is poised to end up being a major player in the production of biofuels if adequate foreign investment can be acquired. Unlike Brazil, where biofuel is produced mainly from sugarcane, or the United States, where it is mostly distilled from corn, Central Asia's ace resource is an indigenous 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 costs, while Turkmenistan is waiting in the wings as an increasing manufacturer of natural gas.


Farther to the east, in Uzbekistan, Kyrgyzstan and Tajikistan, geographical seclusion and reasonably little hydrocarbon resources relative to their Western Caspian next-door neighbors have actually mostly inhibited their capability to money in on rising worldwide energy needs already. Mountainous Kyrgyzstan and Tajikistan remain mostly reliant for their electrical needs on their Soviet-era hydroelectric facilities, but their increased need to generate winter season electrical power has actually resulted in autumnal and winter water discharges, in turn severely impacting the farming of their western downstream next-door neighbors Uzbekistan, Kazakhstan and Turkmenistan.


What these 3 downstream nations do have however is a Soviet-era tradition of agricultural production, which in Uzbekistan's and Turkmenistan case was mostly directed towards cotton production, while Kazakhstan, beginning in the 1950s with Khrushchev's "Virgin Lands" programs, has become a significant producer of wheat. Based upon my discussions with Central Asian federal government officials, offered the thirsty needs of cotton monoculture, foreign proposals to diversify agrarian production towards biofuel would have fantastic appeal in Astana, Ashgabat and Tashkent and to a lower extent Astana for those hardy investors happy to wager on the future, especially as a plant indigenous to the region has currently proven itself in trials.


Known in the West as false flax, wild flax, linseed dodder, German sesame and Siberian oilseed, camelina is bring in increased scientific interest for its oleaginous qualities, with numerous European and American business currently examining how to produce it in industrial quantities for biofuel. In January Japan Airlines undertook a historic test flight using camelina-based bio-jet fuel, becoming the very first Asian provider to explore flying on fuel derived from sustainable feedstocks throughout a one-hour presentation flight from Tokyo's Haneda Airport. The test was the conclusion of a 12-month evaluation of camelina's operational efficiency ability and prospective business viability.


As an alternative energy source, camelina has much to advise 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 used as a rotation crop with wheat, which would make it of particular interest in Kazakhstan, now Central Asia's major wheat exporter. Another benefit 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 load (1000 kg) of camelina will include 350 kg of oil, of which pushing can extract 250 kg. Nothing in camelina production is lost as after processing, the plant's debris can be used for livestock silage. Camelina silage has an especially attractive concentration of omega-3 fats that make it a particularly great animals feed candidate that is simply now gaining acknowledgment in the U.S. and Canada. Camelina is fast growing, produces its own natural herbicide (allelopathy) and competes well versus weeds when an even crop is established. According to Britain's Bangor University's Centre for Alternative Land Use, "Camelina might be a perfect 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 native to both Europe and Central Asia and barely a brand-new crop on the scene: historical proof suggests it has been cultivated in Europe for a minimum of 3 millennia to produce both veggie oil and animal fodder.


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


Camelina's potential might allow Uzbekistan to begin breaking out of its most dolorous tradition, the imposition of a cotton monoculture that has deformed the nation's attempts at agrarian reform since attaining independence in 1991. Beginning in the late 19th century, the Russian federal government determined that Central Asia would become its cotton plantation to feed Moscow's growing textile industry. The process was accelerated under the Soviets. While Azerbaijan, Kazakhstan, Tajikistan and Turkmenistan were likewise ordered by Moscow to sow cotton, Uzbekistan in particular 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 it had become a major exporter of cotton, producing more than one-fifth of the world's production, concentrated in Uzbekistan, which produced 70 percent of the Soviet Union's output.


Try as it might to diversify, in the absence of options Tashkent remains wedded to cotton, producing about 3.6 million loads yearly, which generates more than $1 billion while making up approximately 60 percent of the nation's hard cash earnings.


Beginning in the mid-1960s the Soviet federal government's regulations for Central Asian cotton production mostly bankrupted the area's scarcest resource, water. Cotton utilizes about 3.5 acre feet of water per acre of plants, leading Soviet planners to divert ever-increasing volumes of water from the area's two primary rivers, the Amu Darya and Syr Darya, into ineffective watering canals, resulting in the significant shrinkage 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 diminished to one-quarter its original size in among the 20th century's worst environmental catastrophes.


And now, the dollars and cents. Dr. Bill Schillinger at Washington State University recently explained camelina's organization model to Capital Press as: "At 1,400 pounds per acre at 16 cents a pound, camelina would bring in $224 per acre; 28-bushel white wheat at $8.23 per bushel would gather $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 is the foreign investment. U.S. financiers have the cash and access to the know-how of America's land grant universities. What is certain is that biofuel's market share will grow gradually; less particular is who will profit of establishing it as a feasible issue in Central Asia.


If the current past is anything to go by it is not likely to be American and European investors, fixated as they are on Caspian oil and gas.


But while the Japanese flight experiments suggest Asian interest, American financiers have the academic know-how, if they are ready to follow the Silk Road into establishing a brand-new market. Certainly anything that lessens water use and pesticides, diversifies crop production and enhances the lot of their agrarian population will receive most careful consideration from Central Asia's governments, and farming and grease processing plants are not just much cheaper than pipelines, they can be developed faster.


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

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