02/08/2012 (The Nation) - Shell Thailand has drawn up a two-year plan to transition to purchasing only palm oil that has been certified by the Roundtable on Sustainable Palm Oil (RSPO) for the production of bio diesel.

The company signed an agreement with Patum Vegetable Oil Co Ltd to provide financial, personnel and technical support to achieve the RSPO certification.

Pissawan Achanapornkul, country chairperson for Shell Thailand, said the firm could not reveal the amount of funding provided to Patum Vegetable Oil, saying only that it was sufficient to achieve RSPO certification within the next two years. The funding would also enable the sending of technicians to assist in supply chain development, from the planting of palm trees and delivery of palms to crushing mills, to the palm-oil manufacturing process.

"Shell has applied for membership in RSPO since 2007 and has a clear policy to purchase palm oil only from factories certified by RSPO, including in Malaysia. In Thailand, there are no palm oil factories certified by RSPO at this moment, forcing the company to provide such support to local factories," Pissawan said.

She said that local farmers would directly benefit from the RSPO certification through larger market size and the reduction of environmental impacts.

Sanin Triyanond, director of Patum Vegetable Co, said the firm is the biggest local purchaser of raw palm oil from crushing mills, with annual demand of between 300,000 and 400,000 tonnes per annum, or about 20 per cent of total raw palm oil to be used in the country for consumption and production of bio diesel. The company aims to support sustainable production of palm oil under RSPO certification.

Under the support from Shell Thailand, the company, in cooperation with eight crushing mills and more than 1,000 farmers, will take about two years to produce 50 kilo-tonnes of palm oil under the RSPO standard, sufficient to supply Shell.

Darrel Webber, secretary-general of RSPO, which is an international non-profit organisation, said Thailand is one of the major countries for the plantation of palm trees. RSPO itself wants to encourage sustainability in the palm oil industry and its total supply chain, which will have significant effects for the economy, society, environment and labour, Webber said.

RSPO was established in 2003 as a certifying body for international standards. It has more than 900 members around the world.