(Ecofin Agency) - In Zimbabwe, as parts of effort to achieve a yearly output of 41 million litres, Hippo Valley Estates' ethanol production licence has been extended by the Government.

The company, which is a unit of Tongaat Hullett, a major agribusiness company in South Africa's, has begun ethanol production after years of suspension owing to the decline in prices.

Desperate to control the country's rising fuel bill, Zimbabwe launched compulsory blending of ethanol and unleaded petrol, increasing the blend starting point to E15 from E10 in early 2014.

Sydney Mutsambiwa Hippo’s Managing Director had in September revealed that the company was trying to get authorization from authorities in order to become an independent ethanol producer.

"We do have challenges with respect of the licences to enter into the fuel ethanol market and we are busy engaging with the regulator to get the requisite authority," he said.

As a matter of fact, Green Fuel is at this time the Zimbabwe's only producer of ethanol for blending purposes and has in a number of occasions, failed to feed growing demand as a result of unfavorable weather conditions. The company is a partnership between government's Agricultural and Rural Development Authority Billy Rautenbach's Macdom and Rating Investments,

Hippo's revenue for the half-year which ended in September dropped to $2.2 million from US$9 million. Last year at $70.2 million, Hippo's revenue decreased by 15%, representing weak consumer spending, Zimbabwe Independent reports.