Adam J. Schubert


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Adam J. Schubert

  1. 1. Presentation title second line if required Introducing BP Bio fuels a growing alternative Adam J. Schubert Farm to Fuel Conference – August 31 st , 2006
  2. 2. BP Biofuels a growing alternative Questions for the Day <ul><li>What are the issues that biofuels can solve? </li></ul><ul><li>What is needed for biofuels to meaningfully address these issues? </li></ul><ul><li>What is BP doing to address these issues? </li></ul><ul><li>What public policies will encourage appropriate solutions in the marketplace? </li></ul><ul><li>What are the unique issues for Florida? </li></ul>
  3. 3. BP Biofuels a growing alternative Drivers for Change <ul><li>Key drivers in moving towards sustainable mobility solutions </li></ul><ul><ul><li>Security of supply & energy diversification </li></ul></ul><ul><ul><li>Climate change issues </li></ul></ul><ul><ul><li>Biofuels can address both these issues. </li></ul></ul>
  4. 4. BP Biofuels a growing alternative Security of Supply and Energy Diversification <ul><li>Biofuels will help governments achieve their energy security goals and reduce dependence on imported oil </li></ul><ul><ul><li>In the near-term, logistics play a key role in defining what is feasible and what increases supply security </li></ul></ul><ul><li>Biofuels have the added benefit of helping the agriculture sector </li></ul><ul><li>Current price environment brings popular focus to energy policy </li></ul>Imported Energy Dependency Profile 53% 64% 81% 89% 47% 72% 66% 84% 2004 2020 Transport N America EU China India
  5. 5. BP Biofuels a growing alternative <ul><li>Conventional biofuels are a positive first step in use of biomass </li></ul><ul><li>GHG reductions </li></ul><ul><li>Benefit rural economy </li></ul><ul><li>Limitations : </li></ul><ul><ul><li>Competing land use issues – food vs fuel </li></ul></ul><ul><ul><li>Not ideal fuel molecules: material compatibility; handling/quality issues </li></ul></ul><ul><li>Ethanol issues: </li></ul><ul><ul><li>Significant additional infrastructure costs due to Water Solubility </li></ul></ul><ul><ul><li>Success at scale requires ‘whole of market’ introduction </li></ul></ul>“ Conventional” bio-components sugar & starch crops Ethanol for gasoline Biodiesel (FAME) oil crops
  6. 6. BP Biofuels a growing alternative What is needed? <ul><li>Fuels that can be produced from domestic, renewable resources in high volume and reasonable cost. </li></ul><ul><li>Fuels that can be used in existing vehicles and existing infrastructure </li></ul><ul><li>Fuels that offer good value to consumers </li></ul><ul><li>Fuels that meet the evolving demands of vehicles </li></ul>
  7. 7. BP Biofuels a growing alternative BP’s bio-fuels activity <ul><li>Europe </li></ul><ul><li>British Sugar plant in UK for biobutanol production </li></ul><ul><li>First major to introduce 5% FAME blend in Germany </li></ul><ul><li>Across Europe ETBE replaces MTBE </li></ul><ul><li>EBI Institute University TBD </li></ul>India $9.4M project of Jatropha “oil bearing crops” for diesel fuel <ul><li>US </li></ul><ul><li>Largest user of Ethanol in gasoline </li></ul><ul><li>20 new markets added in 2005 </li></ul><ul><li>Biodiesel to small number of B2B, evaluating more widespread customer offer </li></ul><ul><li>EBI Institute University TBD </li></ul><ul><li>E85 introduction in selected markets by end of 2006 </li></ul><ul><li>Asia </li></ul><ul><li>Round table sustainable Palm Oil </li></ul><ul><li>ANZ </li></ul><ul><li>Supplying Ethanol to retail sites in QLD </li></ul><ul><li>Renewable diesel via tallow </li></ul>
  8. 8. BP Biofuels a growing alternative Issues for Florida <ul><li>Dependency on Waterborne Imports </li></ul><ul><ul><li>Maximize Utilization of Storage Capacity </li></ul></ul><ul><ul><li>Avoid Duplicative Boutique Fuel Burdens </li></ul></ul><ul><ul><li>Encourage Diversity of Supply Sources </li></ul></ul><ul><li>Hurricane Vulnerability </li></ul><ul><ul><li>Reduce Supply Disruption Potential </li></ul></ul><ul><ul><li>Prefer Fully Fungible Fuels </li></ul></ul><ul><li>High Price Sensitivity </li></ul><ul><ul><li>Focus on Low Cost Solutions </li></ul></ul><ul><ul><li>Minimize New Capital Requirements </li></ul></ul>
  9. 9. BP Biofuels a growing alternative Next generation Biofuels <ul><li>Advanced bio-fuels respond to all drivers - deliver on GHG, security of supply & support agriculture sector </li></ul><ul><li>Biobutanol has a number of attractive properties: </li></ul><ul><ul><li>Easily blended into gasoline </li></ul></ul><ul><ul><li>Can use existing fuel infrastructure without major modification </li></ul></ul><ul><ul><li>Potential to be used at higher blend concentrations than ethanol in unmodified vehicles </li></ul></ul><ul><ul><li>An energy content closer to that of gasoline than ethanol – reducing the impact on fuel economy for the consumer </li></ul></ul><ul><li>Biobutanol is complementary to ethanol: </li></ul><ul><ul><li>Can be used together with ethanol </li></ul></ul><ul><ul><li>It can enhance the performance of ethanol blends in gasoline </li></ul></ul><ul><ul><li>It can be produced from the same feeds as ethanol </li></ul></ul><ul><li>Other Advanced biofuels will be explored through Biomass gasification and lignocellulosics </li></ul>
  10. 10. BP Biofuels a growing alternative BP’s New Biofuels Business <ul><li>Formed a new Biofuels business in June </li></ul><ul><li>Announced plans to invest $500 M in new Energy Biosciences Institute to provide a pipeline of biofuels technology for the business </li></ul><ul><li>Will partner with science company DuPont to develop advanced biofuels-the first introduction is biobutanol. </li></ul><ul><li>BP & DuPont collaborating with British Sugar to convert an ethanol fermentation facility to produce biobutanol </li></ul><ul><li>Initial production targeted in the UK during 2007 </li></ul>
  11. 11. BP Biofuels a growing alternative Public Policy Framework <ul><li>Focus on goals </li></ul><ul><ul><li>Give the market room to develop innovative solutions </li></ul></ul><ul><ul><li>Flexibility provides space for quicker response to changing conditions </li></ul></ul><ul><li>Emphasize solutions that can be used in existing vehicles and delivered through existing infrastructure </li></ul><ul><ul><li>These will provide the quickest results at the lowest cost </li></ul></ul><ul><ul><li>These will minimize logistics requirements </li></ul></ul><ul><li>Make room for innovation </li></ul><ul><ul><li>Yesterday’s molecules may not be the best answer for today’s vehicles </li></ul></ul><ul><ul><li>Research can produce improved solutions for tomorrow – but only if they are allowed room to compete in the marketplace </li></ul></ul>
  12. 12. Presentation title second line if required BP Bio fuels a growing alternative