BIOFUEL (ETHANOL & BIODIESEL) PRODUCTION BUSINESS PLAN

TABLE OF CONTENTS

 

1. EXECUTIVE SUMMARY

1.1 Business Concept Overview

1.2 Products and Output

1.3 Location Advantage – Lagos State

1.4 Market Opportunity

1.5 Financial Highlights (Summary)

1.6 Investment Proposition

2. COMPANY OVERVIEW

2.1 Business Name & Legal Structure

2.2 Registered & Operational Address (Proposed)

2.3 Vision Statement

2.4 Mission Statement

2.5 Core Objectives

2.6 Ownership & Governance (Proposed)

2.7 Business Model

3. INDUSTRY OVERVIEW

3.1 Global Biofuel Industry

3.2 African Biofuel Landscape

3.3 Nigeria Biofuel Industry

3.4 Ethanol Market in Nigeria

3.5 Biodiesel Market in Nigeria

4. POLICY, REGULATORY & INSTITUTIONAL FRAMEWORK

4.1 National Biofuel Policy

4.2 Key Regulatory Bodies

4.3 Licensing & Compliance Requirements

4.4 Incentives & Support (Potential)

5. PRODUCTS & TECHNOLOGY

5.1 Overview of Product Portfolio

5.2 Ethanol Products

5.2.1 Fuel-Grade Ethanol (99.5%)

5.2.2 Industrial-Grade Ethanol (95–96%)

5.3 Biodiesel Products

5.3.1 Biodiesel (B100)

5.3.2 Biodiesel Blends (B5–B20)

5.4 By-Products & Secondary Revenue Streams

6. FEEDSTOCK SUPPLY STRATEGY

6.1 Ethanol Feedstock Strategy

6.1.1 Primary Feedstock: Cassava

6.1.2 Secondary Feedstock: Sugar-Based Inputs

6.2 Biodiesel Feedstock Strategy

6.2.1 Palm Oil & Derivatives

6.2.2 Used Cooking Oil (UCO)

6.3 Feedstock Procurement Model

6.4 Feedstock Cost Assumptions (Indicative)

7. LOCATION & SITE ANALYSIS

7.1 Preferred Location: Agbara Industrial Axis

7.2 Land Requirement

7.3 Site Infrastructure Requirements

7.4 Environmental Considerations

8. PRODUCTION PROCESS FLOW

8.1 Ethanol Production Process

8.2 Biodiesel Production Process

8.3 Integrated Operations Advantage

9. PLANT CAPACITY, MACHINERY & UTILITIES

9.1 Installed Production Capacity (Medium-Scale)

9.2 Key Machinery & Equipment

9.3 Utilities Requirement

9.4 Maintenance Strategy

10. MARKET ANALYSIS & DEMAND FORECAST

10.1 Overview of Nigeria’s Energy Market

10.2 Ethanol Market Demand in Nigeria

10.2.1 Demand Segments

10.2.2 Estimated Ethanol Demand

10.3 Biodiesel Market Demand in Nigeria

10.3.1 Diesel Consumption Context

10.3.2 Biodiesel Demand Drivers

10.4 Lagos State as a Primary Market

10.5 Demand Forecast (Conservative)

11. COMPETITIVE LANDSCAPE

11.1 Nature of Competition

11.2 Key Competitor Categories

11.3 Competitive Advantage of GreenAxis Bioenergy

11.4 Barriers to Entry

12. PRICING STRATEGY

12.1 Pricing Philosophy

12.2 Indicative Selling Prices (₦)

12.3 Pricing Advantages vs Imports

13. SALES, DISTRIBUTION & OFF-TAKE STRATEGY

13.1 Target Customers

13.2 Sales Model

13.3 Distribution Channels

13.4 Off-Take Agreements

14. MARKETING & CUSTOMER ACQUISITION STRATEGY

14.1 Marketing Focus

14.2 Customer Acquisition Methods

14.3 Brand Positioning

14.4 Customer Retention Strategy

15. OPERATIONS & WORKFLOW DESIGN

15.1 Operating Philosophy

15.2 Integrated Operational Workflow

15.3 Production Scheduling

15.4 Quality Control & Assurance

15.5 Inventory Management

15.6 Utilities & Energy Management

16. ORGANISATIONAL STRUCTURE & STAFFING PLAN

16.1 Management Structure

16.2 Key Management Roles

16.3 Staffing Requirements (Estimated)

16.4 Shift Structure

17. HUMAN RESOURCE COST STRUCTURE

17.1 Monthly Salary Estimates (₦)

17.2 Annual HR Cost Estimate

17.3 Training & Capacity Building

18. HEALTH, SAFETY & ENVIRONMENTAL (HSE) MANAGEMENT

18.1 HSE Policy Objectives

18.2 Key HSE Risks

18.3 Environmental Management

18.4 Emergency Response Plan

19. ESG & SUSTAINABILITY FRAMEWORK

19.1 Environmental Impact

19.2 Social Impact

19.3 Governance

19.4 Sustainability Roadmap

20. CAPITAL EXPENDITURE (CAPEX)

20.1 CAPEX Philosophy

20.2 Summary CAPEX Estimate

21. STARTUP COST BREAKDOWN

21.1 Land & Site Development

21.2 Civil Works & Buildings

21.3 Process Plant & Equipment

21.4 Utilities & Power Systems

21.5 Pre-Operational & Other Costs

22. OPERATING COST STRUCTURE (OPEX ASSUMPTIONS)

22.1 OPEX Philosophy

22.2 Annual Operating Costs (Stabilised Year)

22.3 Total Annual OPEX

23. FUNDING STRUCTURE & CAPITAL MIX

23.1 Proposed Capital Structure

23.2 Debt Assumptions

23.3 Funding Sources (Indicative)

24. REVENUE ASSUMPTIONS

24.1 Core Assumptions

24.2 Selling Price Assumptions (Base Case)

24.3 Capacity Assumptions

25. PRODUCTION RAMP-UP PLAN

26. 5-YEAR REVENUE PROJECTIONS

26.1 Annual Sales Volume

26.2 Revenue by Product

26.3 Total Revenue

27. PROJECTED PROFIT & LOSS STATEMENT (₦)

27.1 Key Cost Assumptions

27.2 Projected P&L Summary

27.3 Interpretation

28. PROJECTED CASH FLOW STATEMENT (₦)

28.1 Cash Flow Assumptions

28.2 Cash Flow from Operations

28.3 Cash Flow from Investing

28.4 Cash Flow from Financing

28.5 Net Cash Position (Summary)

29. WORKING CAPITAL ANALYSIS

29.1 Working Capital Components

29.2 Estimated Working Capital Requirement

30. PROJECTED BALANCE SHEET (₦)

30.1 Balance Sheet Summary

Liabilities & Equity

30.2 Balance Sheet Strength

31. DEBT SERVICING & DSCR ANALYSIS

31.1 Debt Service Coverage Ratio (DSCR)

31.2 Interpretation

32. BREAK-EVEN ANALYSIS

32.1 Key Assumptions

32.2 Break-Even Volume

32.3 Interpretation

33. INVESTMENT APPRAISAL

33.1 Capital Structure Recap

33.3 Internal Rate of Return (IRR)

33.4 Payback Period

34. SENSITIVITY ANALYSIS

34.1 Sensitivity Variables Tested

34.2 Sensitivity Results (NPV Impact)

34.3 Interpretation

35. RISK ASSESSMENT & MITIGATION

35.1 Key Project Risks

35.2 ESG & Climate Upside

 

1. EXECUTIVE SUMMARY

1.1 Business Concept Overview

GreenAxis Bioenergy Limited is a proposed medium-scale integrated biofuel production company to be located in Lagos State, Nigeria, focused on the commercial production of fuel-grade ethanol and biodiesel for domestic and regional markets.

The company will process locally sourced agricultural and waste-based feedstocks into renewable fuels that can be supplied to:

·       Fuel marketers (blending)

·       Industrial ethanol users

·       Power generation and transport operators

·       Government and institutional off-takers

The integrated model allows the company to:

·       Reduce dependence on a single feedstock

·       Diversify revenue streams

·       Hedge against regulatory or price shocks

·       Maximise asset utilisation

 

1.2 Products and Output

The business will produce:

1.     Fuel-Grade Ethanol (99.5%)

o   Derived primarily from cassava and sugar-based feedstock

o   Used for petrol blending (E10/E20), industrial solvents, pharmaceuticals, beverages, and manufacturing

2.     Biodiesel (B100)

o   Produced from palm oil derivatives, used cooking oil (UCO), and other vegetable oils

o   Supplied to fuel marketers, transport fleets, generators, and industrial users

3.     By-Products

o   Glycerin (from biodiesel process)

o   Distillers Dried Grains with Solubles (DDGS)

o   Carbon credits (medium-term opportunity)

 

1.3 Location Advantage – Lagos State

Lagos State provides strategic advantages:

·       Proximity to major fuel marketers and industrial users

·       Access to ports for equipment and export opportunities

·       Strong logistics and road networks

·       Large labour pool

·       Proximity to feedstock supply chains from the South-West and North-Central regions

The proposed plant will be sited within an industrial corridor in Lagos State, such as:

·       Badagry axis

·       Lekki–Epe industrial zone

·       Agbara industrial area (bordering Ogun State)

 

1.4 Market Opportunity

Nigeria imports a significant portion of its refined fuel additives and industrial ethanol despite:

·       Being the world’s largest cassava producer

·       Having abundant vegetable oils and waste oils

·       Facing rising fuel costs and FX pressure

Key demand drivers include:

·       Government push for fuel blending

·       FX scarcity increasing demand for local substitutes

·       Growth in manufacturing and FMCG sectors

·       Rising energy transition awareness

The integrated biofuel market remains underdeveloped, creating a strong first-mover and expansion advantage.

 

1.5 Financial Highlights (Summary)

Item	Estimate
Estimated Startup Capital	₦6.2 – ₦7.4 Billion
Plant Capacity	Ethanol: ~15–20 million litres/yearBiodiesel: ~8–10 million litres/year
Projected Annual Revenue (Year 3)	₦9.5 – ₦11.8 Billion
EBITDA Margin (Stabilised)	22% – 28%
Break-Even Period	4.2 – 4.8 years
Project Life	20+ years

 

1.6 Investment Proposition

GreenAxis Bioenergy Limited presents:

·       Strong alignment with Nigeria’s energy transition goals

·       Scalable production model

·       High local content utilisation

·       Attractive long-term returns

The project is suitable for:

·       Private investors

·       Development finance institutions (DFIs)

·       Strategic energy partners

·       Public–private partnerships

2. COMPANY OVERVIEW

2.1 Business Name & Legal Structure

Proposed Name: GreenAxis Bioenergy Limited

Legal Structure: Private Company Limited by Shares (Ltd)

Country of Incorporation: Nigeria

 

2.2 Registered & Operational Address (Proposed)

Registered Office:
GreenAxis Bioenergy Limited
Plot 18, Industrial Crescent,
Agbara Industrial Estate,
Lagos–Ogun Axis, Nigeria

2.3 Vision Statement

To become a leading indigenous producer of sustainable biofuels in Nigeria, supporting energy security, environmental sustainability, and economic growth.

 

2.4 Mission Statement

To produce high-quality ethanol and biodiesel using locally sourced feedstock through efficient, environmentally responsible processes that deliver value to customers, investors, and communities.

 

2.5 Core Objectives

·       Establish a commercially viable integrated biofuel plant within 24 months

·       Achieve minimum 80% capacity utilisation by Year 3

·       Replace imported ethanol and diesel additives with local production

·       Develop long-term feedstock partnerships with Nigerian farmers and aggregators

·       Expand into carbon credits and export markets within 5–7 years

 

2.6 Ownership & Governance (Proposed)

Role	Description
Promoters	Nigerian private investors
Board of Directors	3–5 members (energy, finance, operations)
Management Team	CEO, Operations Manager, Finance Manager, Sales & Compliance Leads

 

2.7 Business Model

The company will operate an integrated refinery model:

·       Long-term feedstock sourcing contracts

·       Centralised processing facility

·       B2B bulk sales model

·       Flexible production scheduling between ethanol and biodiesel

·       Emphasis on operational efficiency and cost control

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