BP is strengthening its global biofuel portfolio by investing close to $100 million in two separate Brazilian producers of sugar-based ethanol.
The British oil and gas company has invested $71 million for the remaining 50 percent of Tropical BioEnergia it did not control. It’s also buying another 3 percent in Companhia Nacional de Acucar e Alcool (CNAA). BP purchased the CNAA stake from LDC Bioenergia. Once CNAA’s long-term debt is converted into equity, BP will control 99.97 percent of the company.
These two separate investments confirm BP’s biofuel-focused renewable energy strategy. Over the past five years BP has invested more than $2 billion in biofuels opportunities, acquiring refineries in Europe, Brazil and the U.S. These investments come as the U.S. and other industrial economies are increasing their blending requirements.
On the Tropical BioEnergia and CNAA investments Philip New, vice president of BP Biofuels, said they represented ”another significant milestone in BP’s global biofuel strategy.” New added that the investments also “demonstrate our genuine commitment to Brazil’s ethanol industry, which can deliver sustainable and competitive biofuels into the global market.”
Earlier this year BP CEO Bob Dudley committed to invest $1 billion in 2011 in its renewable energy business, which besides biofuel, also includes a growing wind and solar portfolio.
Outside Brazil, in the U.S., BP is developing the Vercipia cellulosic ethanol facility in Highlands County, Florida. During the summer of 2010 the company purchased Verenium Corps cellulosic biofuels business for $98 million. It’s also a venture investor in Qteros, a Marlborough, Mass., developer of cellulosic ethanol.