BP has agreed to increase its share in Brazilian biofuel company Tropical BioEnergia S.A. to 100 per cent, by acquiring the remaining 50 per cent of the company from its current joint venture partners for a total cash consideration of approximately US$71 million.
BP's current joint venture partners in Tropical BioEnergia S.A. are Maeda S.A. Agroindustrial (25 per cent) and LDC-SEV Bioenergia S.A. (25 per cent).
After the deal is completed, subject to regulatory approval and agreed closing conditions, BP will become the 100 per cent owner of Tropical BioEnergia S.A. and operator of its producing ethanol mill, located in Edéia, Goiás state. BP intends to double the size of the operations at Tropical BioEnergia to a capacity of five million tonnes of crushed cane, or 450 million litres of ethanol equivalent, per year and also to expand operations in the region.
This acquisition takes the number of producing mills in BP's Brazilian ethanol portfolio to three, all of which are located in Goiás and Minas Gerais states in the centre-south of the country.
Philip New, Vice President of BP Biofuels, commented, "This is another significant milestone in BP's global biofuel strategy as we expand our operations base and demonstrate our genuine commitment to Brazil's ethanol industry, which can deliver sustainable and competitive biofuels into the global market."
Mario Lindenhayn, who heads BP Biofuels in Brazil, continues: "We have a major growth agenda for our biofuels business in Brazil. This transaction, together with other recent acquisitions, gives us a strong platform from which to expand our capacity to supply both domestic and international fuels markets."