— Suncor Energy Inc. plans to spend C$120 million ($117.2 million) to double the capacity of its St. Clair ethanol plant near Sarnia, Ontario, the largest biofuel refinery in Canada.
The project will increase the plant's output to 400 million liters (105.5 million gallons) a year, the Calgary-based company said today in a statement. Construction will begin immediately, and the expansion is expected to be completed by late 2009.
Government environmental rules are boosting demand for ethanol, which is blended with gasoline to reduce emissions linked to global warming. Canada last year said gasoline and diesel must have renewable-energy content of 5 percent by 2010.
Suncor currently uses all of the St. Clair plant's output to meet its own needs, and the expansion will enable it to sell some ethanol to other refiners, spokesman Jason Vaillant said today in a telephone interview. The plant, which uses corn as a feedstock, begin operating in 2006.
The project is part of Suncor's plan to invest C$750 million on renewable-energy initiatives by 2012, according to the statement. The company is the second-largest producer from oil-sands deposits in northern Alberta after joint venture Syncrude Canada Ltd.
Suncor fell C$2.89, or 4.2 percent, to C$65.87 on the Toronto Stock Exchange. Before today, the stock rose 27 percent this year.
