British oil and gas giant bp said in a press release last week that it is pausing two biofuels projects while continuing to assess three additional projects.
The two projects in question are its HEFA plants in Lingen, Germany and Cherry Point, Washington state, a spokesperson later confirmed.
The Cherry Point project has been the subject of pushback from the Lummi Nation, a local Native American tribe. According to news reports, bp would have spent around $1.5bn to make upgrades at the refinery.
“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,” the company said in the news release. “This is aligned with bp’s drive to simplify its portfolio, focusing on value and returns.”
The firm made the announcement in tandem with the news that it was acquiring 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.
