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Market News

 July 05, 2007
BP, ABF, and DuPont to Build $400M U.K. Bioethanol Plant

 London, UK --- BP, Associated British Foods, and DuPont announced last week plans to build a $400 million bioethanol plant in Hull, northern England.

BP and ABF subsidiary British Sugar will each own 45 percent of the plant, with DuPont owning the remaining 10 percent.

Construction of the plant, to be located on BP's existing chemical site, could begin in early 2008. It will produce an estimated 420 million litres, or 111 million gallons, of bioethanol from wheat feedstock. The bioethanol plant will employ about 70 people.

With an eye on a supply of locally grown wheat feedstocks, the partners are in discussions with Frontier Agriculture, a grain trading business.

"We are delighted to be announcing, subject to the necessary approvals, the construction of a world scale bioethanol plant in Hull with our partners ABF and DuPont to enable petrol biocomponents to be available to meet the 2010 Renewable Transport Fuel Obligation," said Iain Conn, BP's CEO of refining and marketing business, last week in a statement.

"In addition we have also selected Hull as the preferred location for a planned biobutanol demonstration plant as laboratory research work on the production of this first advanced biofuel that we and partners DuPont will bring to market is progressing well," he said.

When the technology becomes available, production at the plant may switch to biobutanol. BP and DuPont will fund and own equally the neighboring biobutanol demonstration plant.

"Over the last year, we have accelerated the commercial development of biobutanol," said John Ranieri, head of DuPont Biofuels. "The demonstration facility, which will begin operation in early 2009, will develop the processing parameters and further advance the commercial deployment of our new technology.

"At the same time, the growing market demand for biofuels is significant," he said. "We are concurrently investing in the Hull bioethanol facility with the intention to increase that investment once biobutanol process technology development is completed and conversion feasibility is validated."

BP and DuPont plan to import small batches of biobutanol from an existing plant in China as the partners begin market development and execute infrastructure and vehicle testing.

Biobutanol is similar to unleaded gasoline in terms of fuel performance.