The money comes from the Government’s Biofuels Capital Grants Program and has been approved for the 40,000 tonnes per annum biodiesel project which will be located in Port Adelaide.

Last week ARF managing director Darryl Butcher said the Government’s new policy was relatively neutral to the development of biodiesel in Australia but continued to leave the industry well behind European standards.

"ARF is committed to the development of a large commercial biodiesel industry in Australia but note that the relative benefits provided in places such as the European Community, are substantially greater than those available here and that will retard the expansion of the industry."

ARF committed to order the first biodiesel plant, to be located at Birkenhead, South Australia in May with the Adelaide plant to be the largest producer of biodiesel in Australia at full capacity. This is the first of five plants planned to be established Australia-wide. At present, worldwide production of biodiesel is 3.5 billion litres pa.