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Sunoco Inc. (SUN) is considering delving further into the biofuel business after purchasing an ethanol plant earlier this year, Chief Executive and President Lynn Elsenhans said Thursday.

The Philadelphia-based company would be interested in buying a plant near their other assets that could be upgraded to run more advance biofuels than corned-based ethanol, Elsenhans said Thursday afternoon during a conference call with analysts.

In June, Sunoco completed the purchased of a 100 million gallons-per-year ethanol plant in upstate New York. Sunoco bought the facility, which has never been started, for $8.5 and plans to invest up to $20 million to get it running.

The plant could provide 25% of the ethanol Sunoco needs to meet blending requirements.

Sunoco would eventually like to produce 50% of the ethanol it needs and purchased the rest, Elsenhans said Thursday.

"At the end of the day we would not be looking to cover 100% of our blending needs," she said.

Sunoco's move into the ethanol business, follows competitor Valero Energy Corp. (VLO).

Valero recently purchased several Midwestern ethanol plans and is now the second-largest producer of the corn-based fuel in the U.S.

-By Susan Daker, Dow Jones Newswires; 713-547-9208; susan.daker@dowjones.com