British Petroleum is acquiring a 50 percent stake in Tropical BioEnergia SA, a Brazilian company that's currently building a new ethanol plant in Edéia, Goias State, Brazil and planning a second plant. The new plant will have a capacity of 115 million gallons of ethanol a year from sugarcane. The combined investment in the two plants will be approximately $1 billion. Tropical BioEnergia SA is already a joint venture between Santelisa Vale and Maeda Group and the two original partners will each maintain a 25 percent stake in the company. BP is paying $60 million for its share.
The first refinery should start operations in the second half of this year and should hit full capacity in 2010. Supplies from the plants will be targeted at the domestic Brazilian market and could eventually be exported. The plants will both feature cogeneration capabilities using leftover materials after the sugar cane is crushed. The two plants are each expected to have 30MW of surplus electricity that they can sell in addition to the ethanol.