Date:30/06/2007 URL: http://www.thehindu.com/2007/06/30/stories/2007063050771600.htm

Business

BP, D1 Oils form global JV for bio-fuel

Special Correspondent

To take up major jatropha plantation in India

NEW DELHI: The U.K.-based global producer of bio-diesel, D1 Oils, is planning to enter into a global joint venture with British Petroleum to create a world-leading business in jatropha with India being the focus country in view of the thrust on producing bio-fuel.

The new partnership envisages setting up of a 50:50 joint venture to undertake global planting of jatropha with a target to plant one million hectares over four years. British Petroleum will pump in working capital of £31.75 million through equity in the joint venture whose total funding requirement is about £80 million over five years.

D1 Oils will grant BP an option to subscribe for new shares, representing 16 per cent of its enlarged share capital at an average price of 251 pence.

Under the terms of agreement signed on Friday, D1 and BP will work together exclusively on the development of jatropha as a sustainable energy crop, including the planting of trees, harvesting jatropha grain, oil extraction and transport and logistics. Production of jatropha oil for refining into bio diesel is expected to begin in 2008.

According to D1 Oils India Limited CEO Simran Dass, DI Oils has already planted jatropha in around 46,000 hectares in Tamil Nadu, Andhra Pradesh and Northeast.