12 Juli 2007

UK: US$400 million investment in new Bioethanol and Biobutanol plant

BP, ABF and DuPont announce plans for production and demonstration facility

BP, Associated British Foods (ABF) and DuPont have announced major investment plans, totalling around US$400 million, for the construction of a world scale bioethanol plant alongside a high technology demonstration plant to advance development work on the next generation of biofuels. The bioethanol plant, in which BP and ABF subsidiary British Sugar would each hold 45 per cent with DuPont owning the remaining 10 per cent, will be built on BP’s existing chemicals site at Saltend, Hull. Due to be commissioned in late 2009, it will have an annual production capacity of some 420 million litres from wheat feedstock.

Although initial production would be bioethanol, the partners will look at the feasibility of converting it to biobutanol once the required technology is available. “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, chief executive officer of BP’s refining and marketing business. “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.”

Discussions are currently underway to explore strategic partnerships with grain trading business Frontier Agriculture for the supply of locally grown wheat feedstocks and with co-product marketing company AB Agri in relation to DDGS, a byproduct of bioethanol manufacture. It is expected that formal agreements would be finalised after regulatory approvals are obtained.

“We are delighted that this exciting new project has achieved this important milestone, and are confident that construction work will commence early next year after the required regulatory approvals are obtained,” said Mark Carr, CEO of British Sugar. “Front end engineering and design work will commence immediately with Aker Kvaerner leading the project and their joint venture partner Praj providing the technology expertise.”

Although the plant will be built from scratch, it will have access to the existing infrastructure at the BP site for essential supporting services. Once operational it will provide around 70 new full-time posts in addition to the employment opportunities generated by the construction phase.

Biobutanol demonstration plant planmned
The BP site in Hull has also been selected as the preferred location for a planned biobutanol demonstration plant, funded and owned equally by BP and DuPont which could produce around 20,000 litres of biobutanol a year from a wide variety of feedstocks.

“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. 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.”

Introduction of biobutanol from China
To begin market development of biobutanol, BP and DuPont are also establishing initial introduction plans for biobutanol in the UK. The companies will import small quantities of biobutanol, sourced from an existing first generation manufacturing facility in China. The first product is expected to arrive by the end of the year and will be used to carry out infrastructure and advanced vehicle testing.

This testing will build upon initial laboratory engine tests using conventional butanol which indicated that butanol has similar fuel performance properties to unleaded petrol. In addition, work will be undertaken to gather comprehensive data on the environmental footprint and sustainability of this next generation fuel.

The press release is available here as PDF-document.

(Cf. news of 2006-06-22, 2006-04-25 and 2007-05-30.)

Source: BP, press release, 2007-06-26.

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