SAO PAULO (Dow Jones)--U.S. investment fund Comanche Clean Energy has signed a memorandum of understanding with the state government of Maranhao to invest $300 million to build an ethanol mill and biodiesel plant, a person linked to Comanche said Wednesday.
Comanche, an investment fund based in New York, intends to build a mill with the capacity to process 300 million metric liters of ethanol each harvest, while the biodiesel plant should process 100 million liters per year.
The two facilities should come into operation by 2010, the person said.
Comanche selected the Balsas region in Maranhao, traditionally known as a grain producing area, because of good access to Itaqui port and the low cost of production, daily financial newspaper Valor Economico reported.
Comanche invested $150 million last year to acquire two ethanol mills in Sao Paulo state and a biodiesel plant in the northeastern state of Bahia.
Brazil is one of the world's leading biofuel producers and exporters, principally of cane-based ethanol.
Starting January 2008, the country will start mixing an obligatory 2% mix of biodiesel in all diesel fuel, or roughly 800 million liters of biodiesel per year.
Source: Tony Danby; Dow Jones Newswires; 55-11-3145-1489; brazil@dowjones.com