The US$28 million plant would employ 400 people and use 300,000 tonnes of cassava grown in the province to produce 100,000 tonnes of ethanol (equivalent to 120 million litres) annually, as a biofuel alternative to petrol, said Dong Xanh director Nguyen Van Khanh.

Cassava growers in the districts of Dai Loc,Thang Binh, Duy Xuyen and Que Son Districts could earn as much as VND300 billion ($16.8 million) supplying the plant, Khanh noted.

The ethanol produced at the plant was expected to reach the domestic market by the end of this month at a price of VND2,000 cheaper than A92 petrol, said Vu Thanh Ha, director of the PetroVietnam Bio-ethanol Co, which is in charge of distributing the ethanol produced by Dong Xanh.

Dong Xanh has joined forces with PetroVietnam to sell ethanol-blended petrol on a trial basis in some provinces.

The Prime Minister’s biofuel development programme, ratified in November 2007, targets ethanol production nationwide of over 250,000 tonnes per year by 2015 and 1.5 million tonnes per year by 2025.

The nation is also seeking foreign investment in at least 20 projects to increase biofuels production, as well as official development assistance funds to promote development of the alternative fuels sector.