GREEN fuels company D1 Oils said last night it was aiming for profit next year as it posted an expected loss of £7.5m.

Chief executive Elliott Mannis also hinted that more expansion could be on the cards at its new Middlesbrough headquarters.

In its first full year as a public company, D1 planted hundreds of thousands of hectares of the non-edible, oil-bearing weed jatropha across Asia and Africa.

The plant's seeds are crushed to release oil, which can then be turned into biodiesel. The first, limited harvest of jatropha will be this year.

D1 recently established its new global headquarters in Middlesbrough and moved its first refinery there.

Several more refineries, which are being manufactured in Sunderland, will be shipped to Middlesbrough and D1 will begin refining biodiesel there for commercial use by the summer.

Mr Mannis said: "Those refineries will only take up a small part of the eight-acre site. So although I haven't taken the decision just yet, we will be looking to expand our refining capability even more up there."

He said that would lead to more jobs, but it was unclear how many.

D1 said the Middlesbrough site was ideal for the company because of the skills base in the region, and its proximity to the River Tees for transport purposes.

From the summer, it will manufacture up to 32,000 tonnes of biodiesel a year through four new refineries on the site.

Research, development, testing and training will be carried out at the Middlesbrough offices, which also serve as a showcase for the company's technology when international clients visit.

D1 saw pre-tax losses widen from £3.1m to £7.5m, with turnover at £400,000.

But Mr Mannis said the company was aiming for profit in the next financial year, with strong demand for biodiesel being driven by high energy prices and Government support.

Chairman Karl Watkin said: "We have made excellent progress in developing D1's agronomy and refining strengths against the backdrop of growing worldwide awareness of the potential of renewable fuels to meet future energy needs. D1's strategy has been built on an 'earth to engine' approach."

He said there was also now a third section to the business - trading seeds, crude vegetable oils and biodiesel.

He added: "Our efforts are now focused on building on this solid foundation to develop the global business footprint and achieve profitability in 2007.