BP enters Brazil ethanol sector, buys JV stake


BP Plc entered Brazil’s booming ethanol sector on Thursday by taking a 50% stake in a big biofuels project and announcing ambitious investment in the sugar cane-based fuel.

It agreed to pay 100 million reais ($60 million) for the stake in Tropical Bioenergia SA -- a joint venture between Brazilian sugar and ethanol producer Santelisa Vale and Maeda, which grows cotton and soy and makes plant-based oils. The British energy company, better known as a world oil major, said that it and its partners in Tropical will invest 1.66 billion reais ($1 billion) in two new biofuels plants in Latin America’s largest country. Maeda and Santelisa Vale would each now hold 25% in the firm, providing the same share of the overall investment. “This investment is the biggest ever made by an international company in the Brazilian ethanol industry,” BP biofuels division chief Phil New told a news conference. “It represents a significant part in the strategy of BP, which believes in sustainable raw materials that do not have an impact on food supplies,” he added, referring to a heated global debate regarding the influence of biofuels on prices and general availability of food.

Brazil is actively defending its ethanol and biodiesel programs from critics questioning the environmental and social benefits of biofuels. The country says it has enough land to plant crops for energy-efficient fuels like ethanol without compromising crops destined for food. The BP deal comes at a time, when Brazil’s ethanol consumption is starting to exceed gasoline usage as a result of a huge new fleet of flex-fuel cars that can run on gasoline or sugar cane-based ethanol. Brazil is the world’s biggest ethanol exporter.

Ethanol is cheaper than gasoline even though Brazil’s gasoline prices have been frozen since 2005 and consumers have not felt most of the effect of the global oil price rally. Tropical is building an ethanol plant in the central Goias state with a capacity to produce 435 million liters (115 million gallons) a year and plans a second ethanol refinery. “Tropical is well positioned to become Brazil’s leading sustainable supplier of ethanol,” Tropical Bioenergia said on its website. (Reuters)

Alteo Shareholders Approve HUF 400/Share Dividend Green Energy

Alteo Shareholders Approve HUF 400/Share Dividend

Bulgaria's Household Income, Spending Rise 20% in 2023 World

Bulgaria's Household Income, Spending Rise 20% in 2023

MBH Bank’s Post-merger HR Vision HR

MBH Bank’s Post-merger HR Vision

Silvanus Hotel Under Reconstruction, Will Reopen in Fall Hotels

Silvanus Hotel Under Reconstruction, Will Reopen in Fall


Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.