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Oil major British Petroleum (BP), following a leadership succession reportedly cancelled its renewable energy program and withdrew from its joint venture with the company D1 on biodiesel production.
Oil major British Petroleum (BP), following a leadership succession reportedly cancelled its renewable energy program and withdrew from its joint venture with the company D1 on biodiesel production. The joint venture was set to utilize the oil crop jatropha (Jatropha curcas) as feedstock.
Coincidentally, a research report concluded that jatropha utilized a rather large 20,000 liters of water to produce a liter of biodiesel compared with 14,000 for the other biodiesel crops soybean and rapeseed. The report questioned jatropha’s much-celebrated capacity to thrive on marginal soils, one of two planks (the other being its high oil yield) on which its allure for biodiesel production rests. Investment interest in jatropha, not surprisingly then, dipped slightly in the immediate aftermath of BP’s actions.
BP’s policy reversal however, may reflect more of a difference in focus between two corporate helmsmen than a death sentence by global investors on biodiesel and renewable energy. On the contrary, investment in biodiesel and renewables (which recently quadrupled in four years) will most likely show very steep growth for the next few years and for three main reasons. First, the current global climate change and other environmental protocols demand it. Secondly, growing concerns about constraints to future global crude oil production necessitate it; and finally, significant proportions of the current, massive stumulus packages around the world are being channeled into it to buoy up economies.