KEY POINTS:
New Zealand biofuel technology could become a primary industry with the power to transform the economy, according to Singapore-based company Pure Power.
The renewable energy company was formed about two years ago and has offices in Singapore with a technology centre in New Zealand.
Pure Power's Jim Watson says New Zealand's economy is firmly based on the dairy industry.
"We have to develop another sizeable industry and probably the energy opportunity is the one big global opportunity we might have to put in place another industry which has a chance of truly transforming our economy," Watson says.
"This is a primary industry, it has its roots in everything that we have done in the last 150 years."
Pure Power last year bought Genesis Research & Development subsidiary BioJoule with its advanced lignocellulosics technology and aims to build refineries globally.
Last week, Pure Power announced its first commercial offering in New Zealand of a biofuel crop Salix - a variety of willow.
The crops will provide the lignocellulosics feed-stock for Pure Power to use its patented technology to produce biofuels and a range of products used in making paints, resins, adhesives and bioplastics.
Watson, who founded Genesis Research, says 48 per cent of oil goes into transport fuels but the other 52 per cent goes into chemicals which drive the plastics industry.
Watson says, there is virtually no government support for the development of a domestic biofuel industry.
Most nations developing biofuels do so for energy security and used incentives to encourage industrial development, he says.
A bill passed in June has set an obligation for 0.5 per cent of total fuel sales to be biofuel in 2008 and 2.5 per cent in 2012.
The danger of petroleum companies buying biofuel from overseas is it could inhibit investment in New Zealand because contracts will be established and supply chains will be hard to break, Watson says.
Pure Power co-founder David Milroy says the company will use crops grown on marginal land and avoid using feed-stock that competes with food.
Pure Power will have Salix cuttings ready for commercial farming in 2009, with a pilot processing plant expected to be built in Asia by the middle of next year at a cost of about US$20 million ($26 million).
The first refinery is expected to open by the end of 2009 at a cost of about US$60 million.
Pure Power is intending to float the company in 2010 and has business models for the building of anywhere between three and 20 refineries.
PURE POWER
* Renewable energy company based in Singapore.
* Has a technology centre in New Zealand.
* Bought Genesis Research & Development subsidiary BioJoule last year.
* Its first New Zealand commercial offering is a Salix willow-based biofuel.
