20-06-2024
bp to acquire full ownership of bp Bunge Bioenergia while refocusing plans for new biofuels projects
bp has agreed to acquire Bunge’s 50% holding interest in its bp Bunge Bioenergia S.A. joint venture, one of Brazil’s leading biofuels-producing companies.
Upon completion, bp will become sole owner of the industrial scale sugarcane and ethanol business, enabling bp to accelerate value creation through integration with bp’s trading and technology capabilities.
The enterprise value of the stake to be acquired is approximately $1.4 billion. The acquisition will result in consolidation of 100% of the venture’s financial results, including net debt of approximately $0.5 billion and lease obligations of approximately $0.7 billion.
The acquisition meets bp’s expected returns threshold for bioenergy of more than 15% and is fully accommodated within bp’s disciplined financial framework, including capex targets of around $16 billion in each of 2024 and 2025.
Following completion, bp will have the capacity to produce around 50,000 barrels a day of ethanol equivalent from sugarcane through bp Bunge Bioenergia’s 11 agro-industrial units across five Brazilian states. The company operates with an integrated business model that covers the entire production chain through to sales of ethanol and sugar.
bp believes ownership will also offer the potential to unlock further growth opportunities in the region, and to develop new platforms for bioenergy such as next generation ethanol, sustainable aviation fuel (SAF) and biogas.
Focusing biofuels development plans
In parallel to this acquisition, bp is scaling back plans for development of new SAF and renewable diesel biofuels projects at its existing sites, pausing planning for two potential projects while continuing to assess three for progression. This is aligned with bp’s drive to simplify its portfolio, focusing on value and returns.
Emma Delaney, bp’s executive vice president, customers and products said: "bp Bunge Bioenergia is widely recognised as a leader in the industry. I am excited by the opportunity for bp to now add further value from our trading and technology capabilities. bp was an early entrant into the bioenergy business in Brazil and we look forward to continuing to grow and develop here.
“Focusing our plans to develop new biofuels projects is also driven by value. Taken together, these changes can enable us to deliver the growth and returns we expect from biofuels, but in a simpler, more focused way. This is fully in line with bp’s priorities of driving focus into the business and growing shareholder returns.“
This acquisition and focusing on key biofuels production projects are expected to support the continuing growth of bp’s strategic bioenergy business which includes both biofuels and biogas. They contribute to bp’s unchanged 2025 targets of delivering around $2bn EBITDA from bioenergy and $3-4bn across all its transition growth engines.
Subject to regulatory approvals, the transaction is currently anticipated to close by end 2024.
News Category:
-
A new approach to catalyst recycling & sulfur recovery
(Webinar) - Evonik’s catalyst reuse technologies enable today’s sulfur recovery unit operators to gain the activity they require while minimizing cost and environmental ...
24-10-2024
-
Gevo secures conditional commitment from DOE for its Net-Zero 1 SAF plant in South Dakota
Gevo Inc, a leading developer of net-zero hydrocarbon fuels and chemicals, is pleased to announce it received a conditional commitment for a loan guarantee with ...
17-10-2024
-
Wood leads industry project to accelerate CCUS with guidelines for CO2 specifications
Wood, a global leader in consulting and engineering, is leading a Joint Industry Partnership (JIP) to create industry guidelines for CO2 specifications to accelerate ...
17-10-2024
-
Travertine partners with Sabin Metal to build demonstration plant in Upstate New York
Travertine Technologies Inc, an award-winning startup scaling a process for carbon-negative, minimal-waste critical element production, today announced a partnership ...
17-10-2024
-
Valero to supply sustainable aviation fuel to Southwest Airlines
Southwest Airlines Co, today announced a sustainable aviation fuel supply agreement with Valero Marketing and Supply Company, a subsidiary of Valero Energy Corporation, ...
17-10-2024
-
Sweco supports Norsk e-Fuel in the development of e-fuel production sites
Sweco provides engineering services for synthetic Sustainable Aviation Fuel (SAF) projects in Finland, which will have a crucial role in the green transition of the transport ...
17-10-2024
-
Cepsa and Sonatrach sign a Memorandum of Understanding on green hydrogen
Cepsa and Sonatrach have signed today a memorandum of understanding to jointly carry out a feasibility study for the development of an integrated project for green hydrogen ...
17-10-2024
-
Wood leads industry project to accelerate CCUS with guidelines for CO2 specifications
Wood, a global leader in consulting and engineering, is leading a Joint Industry Partnership to create industry guidelines for CO2 specifications to accelerate ...
16-10-2024
-
Neste MY renewable diesel to power Verne data centers back-up generators in Finland
Neste’s renewable diesel helps Verne, a provider of sustainable data center solutions for high intensity computing, to transition its operations from fossil to renewable ...
16-10-2024
-
Lhyfe, one of the world’s pioneers in the production of green and renewable hydrogen*, and Elyse Energy, a European specialist in the production of low-carbon molecules, ...
16-10-2024