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Searing crude fuels BP's jatropha drive
1 Dec, 2007, 1238 hrs IST, TNN
NEW DELHI: The $274-billion oil major British Petroleum Plc (BP) is all set to tap the virgin bio-diesel market in India, the first global major to foray into the cost-effective supplies of sustainable transport fuel.
Middlesbrough Oils UK — an equal joint venture between BP and UK’s bio-diesel company D1 Oil — has sought government permission to undertake contract farming of jatropha — primary feedstock for bio-diesel production — in India.
The joint venture plans to have one million hectares of jatropha cultivation worldwide in four years, and the country would account for a significant chunk.
It also intends to manufacture, market and sell bio-diesel in the country. In an application to the government, the company has said, “Middlesbrough Oils will enter into contract farming agreements with Indian farmers and cooperatives in various parts of India through Carbon Sink Fuel Crops India Pvt Ltd.”
The proposal to get into large-scale jatropha farming in the country comes at a time when global crude oil prices are touching $100 mark. Efforts to promote non-conventional energy sources that can be doped with fuel like ethanol or jatropha makes imminent sense for a country like India which has to import 70% of its energy requirements.
The company would buy back or arrange buyers for the harvested oil-bearing seeds and crude oil from the farmers suitable for refining and production of bio-diesel.
Middlesbrough Oils is the holding company for non-UK business of D1-BP Fuel Crops JV. Middlesbrough Oils would manage its business in the country through its Delhi-based Indian subsidiary, Carbon Sink Fuel Corps.
BP’s JV partner D1 Oil has two joint ventures with Indian companies for jatropha projects. D1 Williamson Magor Bio Fuel and D1-Mohan Bio Oils have secured rights to plant jatropha in 81,000 hectares of land, which is 40% of its total global jatropha acreage.
Production of jatropha oil is expected to begin in 2008. Much of the jatropha oil produced from plantations will be used to meet local bio-diesel requirements and excess will be exported to Europe where domestic feedstock from rapeseed and waste oil is unlikely to be sufficient to meet anticipated regulatory-led demand of 11.2 mte per year from 2010, company sources said.
Jatropha curcas is a drought-resistant, inedible oilseed bearing tree which does not compete with food crops for good agricultural land or adversely impact rainforests. It is considered a sustainable bio-diesel feedstock. Founded in 2002, UK-based D1 Oils plc has been listed on the Alternative Investment Market of London Stock Exchange.
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