The Department of Environment and Natural Resources (DENR) launched yesterday a large-scale biodiesel project, which involves the planting of tuba-tuba or jatropha plants in thousands of hectares of idle land.

The project aims to supplement the country's fuel supply and help cushion the impact of soaring prices of oil in the world market.

DENR Secretary Angelo Reyes, on President Arroyo's orders, gave the go-signal for the massive planting of jatropha plants nationwide through the agency's newly created corporate arm, the Philippine Forest Corp.

The plants will serve as the country's major source of biodiesel.

The commercial cultivation of tuba-tuba-a drought-resistant, perennial shrub that grows throughout the Philippines-will be an integral part of the government's ongoing reforestation program aimed at addressing deforestation and denudation of forested areas across the country.

Philforest president and chief executive officer Rodolfo Lozada told reporters during yesterday's weekly Kapihan sa Sulo Hotel forum that the state-owned firm has been mandated to distribute property and usufructuary rights over public agricultural and forest lands as well as provide support to the beneficiaries of such land to fast-track the development of the tuba-tuba plantations.

"The tuba-tuba needs little or no maintenance and grows quickly, the seeds from which the oil is extracted can usually be harvested after one year," he said.

Lozada said tests conducted by the Industrial Technology Development Institute of the Department of Science and Technology showed that jatropha seeds have a 28.60 percent oil content. One hectare of land planted to tuba-tuba can yield as much as 1,500 liters of biodiesel.

Lozada said that within the next three years, they expect to begin producing commercial biodiesel extract from their jatropha harvest.

Based on the experience of Philforest at its pilot tuba-tuba plantation in the Kalinga sa Kawal Village at Fort Magsaysay in Nueva Ecija, Lozada said the start-up capital to develop a one hectare plantation amounts to P32, 778 but with a crude extraction setup, the initial investment could rise to P59, 578.

"Such plantation begins to earn on the second year period, turning in an average annual income of P42, 202 over a 10-year period or a return on investment of 35 percent," he said.

The projected revenue was based on the tuba-tuba plants' oil output. Excluded from this projection is the possible additional income from its by-products: the oil sediment for soap making as well as the pressed cake that can serve as organic fertilizer and animal fodder.

Besides its pilot plantation at Fort Magsaysay, Philforest has also signed agreements with local government units and state-owned colleges and universities to develop nurseries in their respective areas of jurisdiction.

Lozada also said that as soon they begin harvesting, they will coordinate with the Philippine National Oil Corp. to become the government's marketing arm for the biofuel products they produce from tuba-tuba.

Reyes said in a statement that with this program, the government hopes to make productive vast tract of idle public and private lands unfit for food crop production, generate jobs and livelihood opportunities in the countryside and address ecological concerns, as well as eventually develop a renewable source of energy to help shield the country from the impact of the surging crude oil prices.

Global oil market expert have predicted that crude prices could shortly hit the $100 percent supply amidst a rising demand and regional conflicts, particularly in the Middle East.