What we know: 

- $16.5 million pilot project

- If pilot is successful a $100 million commercial plant will be constructed

- The commercial plant will produce 200 million litres of advanced biofuels a year

- Used by US Navy, Australian Navy, airlines and logistics companies

QUEENSLAND Premier Annastacia Palaszczuk has stolen an advanced biofuels plant from under the nose of New South Wales and plonked it in Gladstone where she believes it will spark the next industry boom.

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The government offered Southern Oil Refinery, owners of Northern Oil Refinery at Yarwun, $3.5 million in conditional grants to run its $16.5 million advanced biofuels pilot plant.

The pilot plant was ready to go in New South Wales but after the government's announcement yesterday, it will be moved to Gladstone after civil works are completed at the Yarwun site.

Southern Oil Refinery general manager Tim Rose said the intention was to run the plant in Wagga Wagga but the "Queensland government wanted it more".

The premier announced $16 million in funding for a new project at Yarwun's Northern oil Refinery.
The premier announced $16 million in funding for a new project at Yarwun's Northern oil Refinery.

The pilot plant will employ six people with the aim to produce advanced biofuels of high enough quality to be used in US Navy ships, airlines, and transport vehicles.

If it is successful, a $150 million plant will be constructed on the site, employing about 60 people full time once it is built.

The push comes nine months after Ms Palaszczuk met with US Navy officials at the Pentagon in Washington DC to discuss how Queensland's biofuels industry could help it reach its renewable energy goals.

She said the project had the potential to create thousands of jobs around Queensland.

"We are talking about jobs up and down the coast and out west from Bundaberg, Mackay, Clermont," she said.

"We are seeking out investment whether it is overseas or from other states. I am prepared to fight New South Wales and get those jobs here."

Gladstone member Glenn Butcher said the new industry would support workers and bring more infrastructures to town.

He said it was a "great day for Gladstone" but it wasn't great news for Wagga Wagga mayor Rod Kendall who had been hearing about the biofuel plant starting up in his city. Mr Kendall said he had been speaking with Mr Rose about the development for some time.

"This demonstrates what a state government can do with a positive attitude to industrial development can have in a regional areas," he said.

"We will certainly be using this as an example of what (New South Wales) government need to do to help development in regional areas."

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