Remember how BP decided to pass on its fines for not meeting its bioethanol sales quotas onto its customers? It raised prices at the pump so as not to cut into its profit margins.
However, the oil giant has apparently taken the lesson to heart – BP just bought the biofuel firm Tropical BioEnergia S.A. in Brazil to the tune of $71 million (American). BioEnergia has two ethanol production sites, both of which will come under sole management of BP. Where there was one site owned by BP and one site managed by BP, there will now be three.
Stated goals are to double the current annual production of bioethanol in the “near future,” to a grand total of 119 million gallons, all produced from millions of tons of crushed sugar cane. The fuel will supply both Brazilian and international markets, and the on-site mills themselves will also be able to supply electricity to Brazil’s grid. On paper, it sounds pretty good.
BP Biofuels VP may look at this acquisition as a “…significant milestone in BP’s global biofuel strategy,” but production of bioethanol wasn’t the issue for BP – it was selling it. BP has yet to show that it can not only produce but also effectively market and sell sustainable and competitive biofuels.