BP boosts green credentials, no really

It is likely to take decades for BP to be regarded as anything other than the bête noire of US environmentalists, but the company yesterday took one small step towards rebuilding its battered green credentials, stumping up $98m (£64m) to acquire assets from biofuels specialist Verenium Corp.

At the same time as the company looks to offload $20bn of its more carbon-intensive assets in an effort to cover the costs of the disastrous Gulf of Mexico oil spill, BP announced it is to shell out $98.3m to acquire Verenium's cellulosic biofuels business, including its facilities in Jennings, Louisiana and San Diego, California.

Under the terms of deal, Verenium will retain select R&D activities as well its commercial enzyme business, including its biofuels enzymes products.

BP, meanwhile, will beef up its presence in the emerging cellulosic biofuels sector, which experts believe provides a more environmentally sustainable alternative to first-generation biofuels.

"This acquisition demonstrates BP's intent to be a leader in the cellulosic biofuels industry in the US and positions us as one of the few global companies with an integrated end-to-end capability, from R&D through commercialisation to distribution and blending," said Philip New, chief executive of BP Biofuels, in a statement.

"By acquiring Verenium's cellulosic biofuels technologies, BP Biofuels should be well placed to accelerate the delivery of low-cost, low-carbon, sustainable biofuels, at scale."

The deal completes a busy few weeks for the US biofuels sector, which has seen several big-name energy firms step up investment in the emerging industry.

The BP deal came just a day after the US-based oil giant similarly announced that it has opened a new facility as part of a $600m research programme designed to develop commercially viable biofuels from algae.

It also follows hot on the heels of news that Wisconsin-based Virent Energy Systems Inc, which specialises in the development of biofuels made from plant sugars, has raised $46.4m from a third funding round, including investment from oil giant Shell.