20th Jun 2006 14:02
BP PLC20 June 2006 June 20, 2006 BP AND DUPONT ANNOUNCE PARTNERSHIP TO DEVELOP ADVANCED BIOFUELS DuPont bio-based science and BP fuels technology expertise will bring next generation biofuels to market BP and DuPont today announce the creation of a partnership to develop, produceand market a next generation of biofuels to help meet increasing global demandfor renewable transport fuels. BP and DuPont have been working together since 2003 to develop advanced biofuelswith properties that can help overcome the limitations of existing biofuels.That work has now progressed to the point where they are able to bring the firstjointly developed product to market. The companies' joint strategy is to deliveradvanced biofuels that will provide improved options for expanding energysupplies and accelerate the move to renewable transportation fuels which loweroverall greenhouse gas emissions. The companies are leveraging DuPont's world-class biotechnology andbio-manufacturing capabilities with BP's fuels technology expertise and marketknow-how. By pooling their knowledge and expertise, the two companies aim to bethe world leaders in the development and production of advanced biofuels,driving the growth of biofuels, which today account for less than two percent ofglobal transportation fuels. Current projections show that biofuels could becomea significant part of the transport fuel mix in the future - possibly up to20-30 per cent in key markets. The first product to market will be biobutanol, which will be introduced in theUnited Kingdom as a gasoline bio-component. Initial introduction is targeted inthe UK in 2007 where BP and DuPont are working with British Sugar, a subsidiaryof Associated British Foods plc, to convert the country's first ethanolfermentation facility to produce biobutanol. Additional global capacity will beintroduced as market conditions dictate and a feasibility study in conjunctionwith British Sugar is already underway to examine the possibility ofconstructing larger facilities in the UK. "DuPont firmly believes that biology will help us reduce global reliance onfossil fuels," said DuPont Chairman and Chief Executive Officer Charles O.Holliday, Jr. "Today we are demonstrating how DuPont's unique scientificcapability provides solutions that are sustainable, renewable and matched toreal world needs. Biobutanol is just the beginning of new solutions DuPont canoffer to transform global economies by improving our use of renewableingredients and natural processes to deliver products for a better, safer,healthier world." "BP has a history of seeking, and delivering, ways to reduce greenhouse gasemissions both from our own operations and from the products we sell," said LordBrowne, chief executive officer of BP. "Transportation is an important area toaddress since it accounts for around 20 per cent of global emissions and in theshort to medium term increased blending of biocomponents represents one of thefew real options for progress in this area on a global scale." Both companies recognize that while existing biocomponents have proven to be anexcellent starting point for the introduction of biofuels and will continue toplay a role in the future, there are issues that need to be addressed toincrease market penetration. In particular, compatibility with existing fuelsupply and distribution systems, the ability to blend in higher concentrationswithout requiring vehicle modifications, and fuel economy were identified asareas where improvements are needed. This next generation of biofuels will help deliver on these targets.Biobutanol's low vapour pressure and its tolerance to water contamination ingasoline blends facilitate its use in existing gasoline supply and distributionchannels. It has the potential to be blended into gasoline at largerconcentrations than existing biofuels without the need to retrofit vehicles andit offers better fuel economy than gasoline-ethanol blends, improving a car'sfuel efficiency and mileage. Biobutanol also enhances the performance of ethanol blends in gasoline by,amongst other things, reducing ethanol's impact on vapour pressure, one of theissues which hampers a wider use of ethanol in existing gasoline distributionchannels. Initial production of biobutanol will be based on an existing technology,enabling early commercial market introduction. In addition, development work ona new biotechnology process which aims to produce biobutanol competitively withethanol is already underway. Production is planned to utilize a range offeedstocks such as sugar cane or beet, corn, wheat, or cassava and, in thefuture, cellulosic feedstocks from fast growing "energy crops" such as grassesor agricultural byproducts such as straw and corn stalks. Since production ofbiobutanol is similar to ethanol and uses similar feedstocks, existing ethanolcapacity can be retrofitted to produce biobutanol. Like most biofuels, biobutanol will provide significant environmental benefitsover petroleum-derived transportation fuels, reducing overall environmentalemissions of greenhouse gases. Biofuels reduce the overall volume of carbondioxide emissions entering the atmosphere by absorbing carbon dioxide asagricultural crops grow, while emitting roughly the same amount of carbondioxide as conventional fuels when they are burned. While greenhouse gases arealso generated in the production of biofuels, the net effect is still lower thanusing conventional fossil fuels. Notes to Editors: • This partnership is consistent with DuPont's strategy to deliversustainable growth by increasing shareholder and societal value while reducingthe environmental footprint along the value chains where DuPont operates. Toimplement this strategy, the company has conducted leading-edge biotechnologyresearch for more than 10 years. In 2003, the U.S. Environmental ProtectionAgency presented DuPont with its annual "Presidential Green Chemistry Award" forthe company's research leading to the development of its first bio-basedproduct, Bio-PDOTM, a key ingredient in DuPontTM Sorona(R), the company's latestpolymer innovation. The partnership with BP extends the technologicalcapabilities demonstrated with Bio-PDOTM to an even larger and more urgentmarket opportunity for biofuels. • BP's decision to devote a significant level of resources into wideningthe availability of biofuels is part of its strategy of identifying low carbonor renewable fuels for the future. It follows on from the company's announcementof BP Alternative Energy - a dedicated alternative energy business which isactive in solar, wind, hydrogen and combined-cycle-gas-turbine (CCGT) powergeneration - and the establishment of a biofuels business within its Refining &Marketing Business. The company also recently announced its intention to fund anEnergy Biosciences Institute attached to a major academic centre, the first suchfacility of its kind in the world. • DuPont is a science company. Founded in 1802, DuPont puts science to workby creating sustainable solutions essential to a better, safer, healthier lifefor people everywhere. Operating in more than 70 countries, DuPont offers a widerange of innovative products and services for markets including agriculture,nutrition, electronics, communications, safety and protection, home andconstruction, transportation and apparel. • BP is of one of the world's largest energy companies, providing itscustomers with fuel for transportation, energy for heat and light, retailservices and petrochemicals products for everyday items. It is the largest oiland gas producer in the U.S. and one of the largest refiners. BP also has aglobal network of around 25,000 service stations. Further information: BP Press Office, London, UK, tel: +44 (0)207 496 4358DuPont Press Office, Wilmington, Delaware, tel: +1 302 774 7447 Forward-Looking Statements: This news release contains forward-lookingstatements based on management's current expectations, estimates andprojections. All statements that address expectations or projections about thefuture, including statements about the company's strategy for growth, productdevelopment, market position, expected expenditures and financial results areforward-looking statements. Some of the forward-looking statements may beidentified by words like "expects," "anticipates," "plans," "intends,""projects," "indicates," and similar expressions. These statements are notguarantees of future performance and involve a number of risks, uncertaintiesand assumptions. Many factors, including those discussed more fully elsewherein this release and in DuPont's filings with the Securities and ExchangeCommission, particularly its latest annual report on Form 10-K, as well asothers, could cause results to differ materially from those stated. Thesefactors include, but are not limited to changes in the laws, regulations,policies and economic conditions of countries in which the company doesbusiness; competitive pressures; successful integration of structural changes,including acquisitions, divestitures and alliances; research and development ofnew products, including regulatory approval and market acceptance, andseasonality of sales of agricultural products. - ENDS - This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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