BP makes big investment in Brazilian biofuels
BP has made a $680 million (£424 million) investment in Brazil with a purchase of one of the nation's leading biofuels companies.
The British energy giant now owns 83 per cent of the shares of the Companhia Nacional de Açúcar e Álcool (CNAA), which is one of the world's leading producers of sugar cane and ethanol biofuel.
The vice-president of BP Biofuels, Philip New, said that their investment in the company was a different order of magnitude to their previous biofuel efforts in Brazil, which include a 50 per cent stake in Tropical BioEnergia.
"This is a watershed moment," he said. "It is a foundation step for turning biofuels into a fully fledged business in BP."
The purchase of CNAA means BP gains the company's 2,500 employees, two functioning ethanol mills and another that is currently under construction. The deal also includes the necessary sources of sugar cane to supply the mills which, at full capacity, will be able to process 15 million tons of sugar cane every year, generating more than 1.4 billion litres of ethanol.
Mr New said that this investment indicated the important role that Brazil is playing in the realistic development of biofuels as alternatives to fossil fuels.
"Biofuels are the only real alternative to crude oil if we are looking for decarbonised transport fuels and a broader set of supply options," he explained.