Phnom Penh - A North Korean company said it would launch Cambodia's first biofuel factory, specializing in cassava conversion, by October, a newspaper reported Wednesday.

Rasmei Kampuchea daily reported MH Bio-energy Group's director Choi Wee Sung said he had already advised Prime Minister Hun Sen of the factory's inauguration date at a site on the outskirts of the capital and hoped it would help Cambodia go green.

The factory will buy a minimum of 30,000 tons of locally grown cassava per year to convert into ethanol for use as biofuel, and is expected to reach full capacity by next year, the paper quoted Choi as saying.

MH Bio-Energy Group describes itself on trading website Alibaba. com as "the biggest Korean investment company in Cambodia."

"We will produce bio-ethanol in 2008, we can supply all kinds of agricultural product especially cassava chip, cassava starch in the world market," it says.

The paper quoted the prime minister's spokesman Eng Sophalet as welcoming the company's ambitions, and Choi said he has already been invited to expand nationally.

Cambodia maintains warm relations with North Korea, where former king Norodom Sihanouk maintains a residence.

It has thrown open its threadbare secondary industry market to all competitors willing to invest in factories, which are sparse and currently almost exclusively devoted to garments, leaving Cambodia to export its agricultural products and buy them back once processed. (dpa)