Biodiesel fuel is produced from lipids including tallow and canola and is seen by its proponents as a replacement for diesel fuel in the transportation industry. The plant will be built in the picturesque southwest town of Picton with construction due to begin in May of this year.

A project proponent, Australian Renewable Fuels, which is a wholly-owned subsidiary of Amadeus Energy Ltd, said it is currently in negotiations with the South West Development Commission for the purchase of a 10-hectare site at Picton.

Australian Renewable Fuels also indicated that other biodiesel plants may be established around the State in the future.