Plans for 36 million gallon Florida facility abandoned as oil giant focuses on R&D and licensing technology
26 Oct 2012
BP has pulled out of plans to build a $300m plant
in Florida that would have been capable of producing biofuel from hard
to break down crops, dealing a major blow to US efforts to deliver
so-called "second generation" biofuels.
The company announced in a statement yesterday that it would not be proceeding with the cellulosic ethanol plant in Highlands County, which was expected to be capable of producing 36 million gallons (136 million litres) of the fuel each year.
Instead, BP said it would refocus its US biofuels strategy on research and development as well as licensing its technology.
"Given the large and growing portfolio of investment opportunities available to BP globally, we believe it is in the best interest of our shareholders to redeploy the considerable capital required to build this facility into other more attractive projects," said Geoff Morrell, BP vice president of communications.
The move follows Shell's decision to back out of a similar commercial-scale plant in Canada intended to make ethanol from straw and plant waste. It also further shrinks BP's alternative energy business to just two main operations focused on US wind power and ethanol made from Brazilian sugar cane.
However, BP is also still working on plans to develop a plant in Hull, North-East England, capable of processing local feed wheat into 420 million litres of bioethanol, and a biobutanol plant on the same site in partnership with DuPont.
The decision to nix the Highlands plant is another blow to the Obama administration, which sees advanced biofuels as a way of weaning the country off expensive oil imports.
This year it has been forced to slash its mandate for second generation biofuels from 500 million gallons (1.9 billion litres) to just 8.65 million gallons (33 million litres) as manufacturers struggle to produce sufficient volumes. Republicans are campaigning to have the mandate abolished entirely.
Second generation biofuels are seen as a more sustainable way of cutting emissions from transport fuels, as unlike conventional biofuels they use feedstocks that do not compete for land with food crops, such as sorghum, agricultural residues, and other waste products.
Meanwhile, doubts have this week been cast over another feted potential second generation biofuel feedstock, algae, which the US National Research Council said on Wednesday needs unsustainable amounts of energy, water and fertiliser to produce fuel on a large scale.
Jennie Hunter-Cevera, a microbial physiologist who headed the research committee, told news agency Reuters the finding was not a definitive rejection of algae-derived fuels, but a reminder the technology is not yet ready to support commercial levels of production.
"Faced with today's technology, to scale up any more is going to put really big demands on ... not only energy input, but water, land and the nutrients you need, like carbon dioxide, nitrate and phosphate," she said. "Algal biofuels is still a teenager that needs to be developed and nurtured."
The company announced in a statement yesterday that it would not be proceeding with the cellulosic ethanol plant in Highlands County, which was expected to be capable of producing 36 million gallons (136 million litres) of the fuel each year.
"Given the large and growing portfolio of investment opportunities available to BP globally, we believe it is in the best interest of our shareholders to redeploy the considerable capital required to build this facility into other more attractive projects," said Geoff Morrell, BP vice president of communications.
The move follows Shell's decision to back out of a similar commercial-scale plant in Canada intended to make ethanol from straw and plant waste. It also further shrinks BP's alternative energy business to just two main operations focused on US wind power and ethanol made from Brazilian sugar cane.
However, BP is also still working on plans to develop a plant in Hull, North-East England, capable of processing local feed wheat into 420 million litres of bioethanol, and a biobutanol plant on the same site in partnership with DuPont.
The decision to nix the Highlands plant is another blow to the Obama administration, which sees advanced biofuels as a way of weaning the country off expensive oil imports.
This year it has been forced to slash its mandate for second generation biofuels from 500 million gallons (1.9 billion litres) to just 8.65 million gallons (33 million litres) as manufacturers struggle to produce sufficient volumes. Republicans are campaigning to have the mandate abolished entirely.
Second generation biofuels are seen as a more sustainable way of cutting emissions from transport fuels, as unlike conventional biofuels they use feedstocks that do not compete for land with food crops, such as sorghum, agricultural residues, and other waste products.
Meanwhile, doubts have this week been cast over another feted potential second generation biofuel feedstock, algae, which the US National Research Council said on Wednesday needs unsustainable amounts of energy, water and fertiliser to produce fuel on a large scale.
Jennie Hunter-Cevera, a microbial physiologist who headed the research committee, told news agency Reuters the finding was not a definitive rejection of algae-derived fuels, but a reminder the technology is not yet ready to support commercial levels of production.
"Faced with today's technology, to scale up any more is going to put really big demands on ... not only energy input, but water, land and the nutrients you need, like carbon dioxide, nitrate and phosphate," she said. "Algal biofuels is still a teenager that needs to be developed and nurtured."
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