The funding will allow the three firms to convert and market a number of stations throughout Queensland to ethanol blend fuels.

Queensland Deputy Premier Anna Bligh said the announcement was particularly pertinent given the record global oil price.

Bligh said Queensland was leading the Australian uptake of ethanol blend fuels but there was still much more to be done.

"The grants I'm announcing today will ultimately add 30 new outlets to the 128 service stations already offering ethanol blend fuels throughout the state," Bligh said.

"That's an incredible achievement by the Government and the fuel industry when you consider that just 18 months ago there were only 40 service stations stocking E10 in Queensland."

Bligh said the Government was determined for ethanol to gain a foothold in Queensland and would ultimately like it to be stocked at all fuel outlets.

The new grants consist of $365,000 to Freedom Fuels Retail to convert 13 service stations to ethanol; $300,000 to Neumann Petroleum to convert 17 stations; and $70,000 to United Petroleum to market E10 blend fuel at 24 outlets.

The funding was part of the Government's $7.3 million Queensland Ethanol Initiative 2005-07.

A $2.3 million marketing campaign as part of the program will be unveiled at the Ethanol 2006 Australia Conference in Brisbane.