Agifish has been using the fuel, made from fat left over from processing, to run pumps at its fish ponds in the Mekong Delta province of An Giang in southern Vietnam.

Nguyen Dinh Huan, Agifish deputy director, said : "We are planning to commercialise the fuel based on the result of pilot tests. The fuel is as good as diesel oil."

Ho Xuan Thien, the chief engineer of the project, said the firm planned to build a a new factory next year to mass produce the fuel for domestic markets.

A kilogramme of catfish fat could produce 1.13 litres of biofuel, Thien said.

Vietnam currently produces around 30,000 tonnes of catfish annually, mainly for export to the United States and Europe.

Although Vietnam is Southeast Asia's third largest crude oil producer after Indonesia and Malaysia, it still relies on oil product imports for fuel because it lacks major refineries.

Malaysia concerns

Meanwhile in Malaysia, authorities have suspended giving new licenses for biodiesel production projects, after concerns that an excess of projects could deprive the food market of palm oil, widely used in cooking, a report said on Monday.

Spurred by the interest in the fuel, touted as a cheaper substitute for petrol and diesel, the government has so far approved 32 projects.

But it announced last week that it will stop issuing licenses for new projects until it completes a study of the palm oil downstream industry.