bp has announced the acquisition of Bunge’s 50% stake in the bp Bunge Bioenergia joint venture, making bp the sole proprietor of the biofuels producer. Valued at $1.4 billion, this strategic move enables bp to consolidate the financial results of the venture, including net debt of around $0.5 billion and lease obligations of approximately $0.7 billion. With this acquisition, bp gains full control of 11 agro-industrial units across five Brazilian states, with the capacity to produce about 50,000 barrels of ethanol equivalent per day from sugarcane.
Emma Delaney, bp’s executive vice president of customers and products, stated, “bp Bunge Bioenergia is widely recognized as a leader in the industry. I am excited by the opportunity for bp to now add further value from our trading and technology capabilities.”
Alongside this acquisition, bp is reevaluating its development plans for new biofuels projects. The company is pausing the planning of two potential projects while continuing to assess three others, reflecting its strategy to simplify its portfolio and focus on high-return opportunities. Delaney added, “Focusing our plans to develop new biofuels projects is also driven by value. Taken together, these changes can enable us to deliver the growth and returns we expect from biofuels, but in a simpler, more focused way.”
These strategic changes are aimed at supporting the growth of bp’s bioenergy business, which includes both biofuels and biogas. This move aligns with bp’s target of achieving approximately $2 billion in EBITDA from bioenergy by 2025 and $3-4 billion from its transition growth engines.
The transaction is expected to close by the end of 2024, pending regulatory approval.