BP takes a step toward investing in nonfood biofuel

BP’s announcement Wednesday that it will invest $90 million in a U.S. biofuels company could boost efforts to bring nonfood-based ethanol out of the laboratory and into the fuel tanks of American drivers.

It also may be a catalyst to other oil companies to enter the so-called cellulosic ethanol business in a bigger way.

“It’s a big signal to the industry that this technology is one to pay attention to,” said Gary Adams, vice chairman of Deloitte’s oil and gas industry consulting practice in Houston.

BP’s investment will fund a partnership between the London-based oil giant and Verenium Corp., a Cambridge, Mass.-based company that has developed technology to make ethanol from sugar cane and other “energy” crops including miscanthus, a perennial grass.

Houston Chronicle