A Thai major oil refiner, Bangchak Petroleum Plc, has launched a project to buy used vegetable oil from consumers to produce biodiesel to help recycle vegetable oil that would otherwise provide a health risk and disposal problem.

Bangchak president Anusorn Saengnimnuan and Prince of Songkhla University (PSU), Hat Yai Campus Rector Boonsom Siribamrungsuk signed an agreement to cooperate in producing biodiesel from used vegetable oil, Thai News Agency reported Monday.

Anusorn said Bangchak is now constructing biodiesel refinery which has a capacity of 20,000 liters per day which is expected to be completed in November.

The biodiesel refinery would use technology developed by PSU and biodiesel from the plant would be sold at Bangchak's gas stations, he said.

Five Bangchak petrol stations in Bangkok will initially buy used vegetable oil from consumers at 12 baht per kilogram if the oil passes the company's acceptance criteria such as bright color and not being contaminated with water or food.

One liter of used vegetable oil can produce 0.9 liter of biodiesel fuel, according to the company.

The program is in response to the Thai government policy to promote the use of biodiesel to 8.5 million liters per day, Anusorn said, as Bangchak expects to have 100 biodiesel stations operational by the end of this year.