UK oil giant BP and UK biofuels producer D1 Oils are forming a 50/50 joint venture, to be called D1-BP Fuel Crops Limited, to accelerate the planting of jatropha curcas in order to make more sustainable biodiesel feedstock available on a larger scale.
Jatropha curcas is a drought-resistant, inedible oilseed-bearing tree that does not compete with food crops for good agricultural land or adversely impact the rainforest, and will also provide employment for local communities, BP said.
Under the terms of the agreement, BP and D1 Oils intend to invest around $160 million over the next five years. D1 Oils will contribute into its 172,000 hectares of existing plantations in India, southern Africa and southeast Asia, and the joint venture will have exclusive access to the elite jatropha seedlings produced through D1 Oils's plant science program.
The joint venture will focus on jatropha cultivation in southeast Asia, southern Africa, Central and South America and India. It is anticipated that some one million hectares will be planted over the next four years, with an estimated 300,000 hectares per year thereafter.
Jatropha oil produced from the plantations will be used to meet both local biodiesel requirements and for export to markets such as Europe, where domestic feedstock produced from rapeseed and waste oil is unlikely to be sufficient to meet anticipated regulatory led demand for biodiesel of around 11 million tonnes a year from 2010.
"Once all the planned plantations are established, the joint venture is expected to become the world's largest commercial producer of jatropha feedstock, producing up to two million tonnes of jatropha oil a year," said Phil New, head of BP Biofuels.
"As this hardy crop can be grown on a wide range of land types, it can make a significant impact on employment in rural areas of developing countries where planting takes place, a benefit which fits well with BP's aspiration to pursue relationships which are mutually advantageous," Mr New continued.
