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June 20, 2010Valero Energy which is the US’s largest oil refiner has positioned itself strongly to take advantage of future shift in the fuel industry.The massive drop in Oil Price and the Global Financial Crisis had virtually destroyed the US ethanol industry in 2008.Valero Energy had used the depressed prices of the ethanol companies to its advantage,buying up a massive ethanol capacity from bankrupt biofuel leader Verasun Energy for a dirt cheap $477 million .Note at that time Valero Energy was the first Oil Refiner to buy/set up Ethanol Capacity.
Valero Energy, the Oil Refiner, Wins an Auction for 7 Ethanol Plants – NY Times
Valero Energy, the country’s largest independent refiner, said on Wednesday that it would buy seven ethanol plants from VeraSun Energy for $477 million, giving the biofuel industry a lift at a time when it is suffering from excess production capacity and falling gasoline consumption.VeraSun, the nation’s second-largest ethanol producer after Archer Daniels Midland, filed for Chapter 11 bankruptcy protection last fall. Valero’s purchase signals important new support for a flagging industry from an unexpected quarter. In recent years, refiners have opposed Congressional mandates for refineries to blend increasing amounts of ethanol in gasoline, arguing that it made neither economic nor environmental sense.
While I don’t think Biofuels from crops are a solution to peak oil and climate change, nonetheless Governments are still strongly supporting this industry.With the BP Oil Spill putting the focus back on Renewable Energy and Alternative Fuels,ethanol stands to make a comeback as the 22 Billion Gallons of Biofuel still needs to blended by the US Transportation Industry by 2022.
Verasun putting the money where its mouth is unlike other Oil Companies
Verasun Energy is not sitting on its ethanol laurels,but is actively looking at other biofuel areas like biodiesel and algae based biofuels.Exxon,Chevron has made only token promises in supporting biofuels committing a minuscule portions of their vast resources in supporting biofuels.Now the Oil Companies are busy trying to evade questions about their Green commitment in the wake of the BP disaster.However Valero with smaller resources has been much more proactive in the green fuel area.It has partnered with one of the US largest food processors to set up a biodiesel plant in Louisiana.It has also invested in a algae based biofuel startup Algenol though Algae based biofuel still remains an nonviable commercial technology as of now. Terrabon a waste to fuel startup has seen a small investments from Valero Energy
Valero plans JV biodiesel plant with Darling International – CleanTech.com
The largest independent refiner in North America teams up with the processor of food by-products for the plant that would make 10,000 barrels of fuel per day from used cooking oil and animal fat.San Antonio, Texas-based refiner Valero Energy said it plans to grow its diesel production through a joint venture with Irving, Texas-based Darling International which processes by-products of the food industry.The proposed biodiesel plant in Louisiana is expected to produce 10,000 gallons per day, or 135 million gallons per year. The companies declined to reveal financial terms of the venture or a time line, but said they want to secure a loan guarantee from the U.S. Department of Energy.
Algenol partners Valero to commercialize algae biofuels – Brighterenergy
Florida company Algenol Biofuels, Inc., has agreed to work with a subsidiary of oil and gas giant Valero Energy Corporation to pursue commercial-scale algae biofuels production.Algenol, which is based in Bonita Springs, southern Florida, signed a joint development deal with Valero Services, Inc., to combine its “Direct to Ethanol” algae technology with Valero’s expertise in fuel production and distribution infrastructure.The collaboration has the potential to result in a joint venture to develop commercial scale algae-based biofuels production facilities, the companies said.Paul Woods, CEO and founder of Algenol, said: “We are excited and encouraged to be working with Valero on this initiative, bringing together Valero’s industrial expertise and Algenol’s revolutionary technology. This collaborative effort is a significant step on the road to the commercialization of algae-based biofuels and biochemicals.”
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[…] is still a decade away,as the technology is far from mature.However major Oil Refiners like Valero are already positioning themselves in this space.All the Oil Majors like Chevron,Shell,Exxon have made investments in biofuels in order to hedge […]
[…] been the biggest investor in Biofuels with a $12 Billion tie up with Brazilian Sugar Giant Cosan.Valero has also smartly invested in a number of biofuel startups despite being one of the strongest opponents of Green Energy.Exxon has only promised huge […]