Brazilian producers of ethanol agree to merge
By Jonathan Wheatley in São Paulo
Published: February 19 2010 03:02 | Last updated: February 19 2010 03:02
Two Brazilian sugar and ethanol producers on Thursday agreed to merge to create what they hope will be the country's biggest biofuels company.
Thursday's deal is between ETH Bioenergia, part of the Odebrecht group, a Brazilian conglomerate whose main activity is construction and engineering, and Brenco, a Brazilian renewable energy group whose backers include Ashmore Energy of Houston, Texas, an investor in energy projects in emerging markets.
It aims to process 40m tonnes of sugar cane by 2012, producing 3bn litres of ethanol and 2,700 GWh of electricity from co-generation plants, giving projected revenues of R$4bn.
This month the US Environmental Protection Agency (EPA) recognised sugar cane as a low carbon renewable fuel, reinforcing hopes that subsidies and tariffs that deter Brazilian ethanol exports could begin to fall in markets such as the US, Japan and Europe.
Mr Grubisich said the EPA's decision should lead to a removal of barriers in the US and Japan, followed later by Europe, and that the new company would seek investment opportunities in the Caribbean to serve the US market and in Africa to serve Japan.
Shell bets on ethanol in $21 billion deal with Brazil's Cosan
SAO PAULO (Reuters) - Royal Dutch Shell Plc plans to make the biggest-ever foray into biofuels by an oil major, striking a deal with Brazil's Cosan to create a $21 billion a year ethanol joint venture.
The venture, which will be the No. 3 fuel distributor in Latin America's largest country, marks Shell's entry into ethanol production and underscores the biofuel's lure as an alternative to gasoline. It also follows moves by British oil company BP Plc, which in 2008 took a stake in a Brazilian biofuel project and unveiled $1 billion in investments.
Cosan, which recently obtained a court injunction to remove its name from a government black list of companies with slave-like working conditions, said it had 180 days to discuss the nonbinding memorandum of understanding exclusively with Shell International Petroleum Co Ltd.
Notes to editors
Cosan and Shell would contribute the following to the joint venture: