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The BP Biofuels Story

Perspectives from the president on RFS2, Florida and green beginnings
| October 24, 2011

The call from President Obama for the U.S. to develop a clean energy economy seemed like the perfect rallying cry for rival energy crop companies and competing advanced biofuel developers, giving virtually everyone in the bioenergy world an idea to agree on. That idea, to move away from nonrenewable energy sources, to create jobs through wind farms, solar complexes, biomass power plants or biorefinieries seem to include the oil majors. But Sue Ellerbusch, president of BP Biofuels North America, didn’t care, and she didn’t need a call for action from the president. Ellerbusch, who has been with BP for 20-plus years mostly in the chemical and the fuels industries, joined the biofuels business five years ago at BP when she says it was about a dozen people in the U.K. trying to figure out who or what they wanted to be. “I came to the U.S. four years ago to really make what we wanted to be on a piece of paper a reality,” she tells Biorefining Magazine.

That reality for Ellerbusch, who admits she gets passionate about and excited to explain, is all about cellulosic ethanol production and her team’s quest to make it happen in the U.S. Ellerbusch discusses her passion, her role as president of a company whose name doesn’t seem to fit with the word biofuels and what she believes BP’s presence in the biofuels landscape can mean for the country—and how it might play into that idea of a clean energy economy. She talks about the story of Highlands Ethanol and what it reveals about BP Biofuels’ dedication to the advanced biofuels industry. 

Green Beginnings

The best way to describe the landscape of Highlands County, Fla., is with images of vast green, grassy fields, grazed through by roaming cattle or matted down by heavy rain, scrub trees scattered across the land in no relevant pattern and marsh acres mingled throughout. The story of Ellerbusch and her team starts there—sort of. Through a partnership that includes one of the country’s largest landowners, BP Biofuels is working to build a cellulosic ethanol facility that many may not even know of, which will put roughly 20,000 acres previously unused or unable to sustain consistent agricultural practice into use as an energy cane farm, and a location for a 1,000-ton-per-day, 36 MMgy cellulosic ethanol plant. The facility represents the center of Ellerbusch’s current universe.

Chuck Grawey, general manager for the Highlands project, says the venture is made up of the best of both worlds, and he even says that the team is solving problems that other competitors don’t even know they have yet. As Grawey infers, the work at Highlands is a team effort, and although the facility will be the first advanced biofuel production site ever constructed in the U.S. by an oil major, the story of BP Biofuels is also about a demonstration facility in Jennings, La., and a global technology research and development site in San Diego. Or, as Ellerbusch says, the story of Highlands shows that even companies with a “B” and a “P” in the name believe that cellulosic biomass has a place in the renewable fuel pool. To the critics, Ellerbusch says: “This is an industry that is ready to be built up, and the technology is viable today. We are making cellulosic ethanol in Jennings  so we know it can work,” she says. “We are proving that the feedstocks exist and you can farm this and make it very viable—and I want people to know that.”

The facility in Jennings, which BP bought from then partner Verenium for $98.3 million, gave Ellerbusch and her team a unique opportunity, she says, which was also something they were focused on well before the disaster in the Gulf. In addition to the 1.4 MMgy demo facility, BP also acquired the rights to research and development facility in San Diego, now named BP Biofuels Global Technology Centre. “With San Diego and Jennings, we have the ability to prove things out at a small research scale and then we can bring it to an operating facility and scale it up, and learn about operations that then transfer to an engineering team.” She says the engineers can then use all that information in combination with BP’s long heritage of engineering and constructing refineries across the world to design and build the Highlands facility. “It is a unique capability in the industry,” she says, “and one that we are trying to continue to build on and leverage within the U.S.”
It’s that sentiment that helps reveal the passion of Ellerbusch and why her role as president could last longer than the time it takes to build the facility in Florida. “We can build a series of units along the Gulf Coast so that we can bring this industry to material scale as soon as possible,” she says.

Major Perspectives

Say what you will about the oil major’s involvement with biofuels, but according to Ellerbusch, the story of Highlands highlights what the energy giant thinks about biofuel use in the future. That story, however, isn’t just about what she and Grawey think—it’s about what they’ve learned.

Twenty years spent in the chemicals and fuels business didn’t leave a lot of time for Ellerbusch to spend in the agricultural sector, but her time in Florida, San Diego and Jennings has helped her catch up. “I didn’t know anything about farming before I came into this role,” she tells Biorefining Magazine, “and I’ve been tremendously impressed about the quality of people in that industry, their entrepreneurial nature and their real desire to bring a domestic energy source to the U.S.”

Lykes Bros. Inc., an agricultural partner in the Florida project and also one of the largest private landowners in the U.S., is one of the farming groups that Ellerbusch says her team has learned a lot from. Joe Collins, vice president of Lykes Bros., says he knew about growing energy crops for a long time, and the partnership with BP gave his company a reason to grow in Florida. Along with Lykes Bros., Ellerbusch says other farmers and landowners in the U.S. that she has met with have been really interested in trying to find a way to help create the new 12- to 15-foot tall energy cane farming approach, an effort that is a project in itself, she says. And it makes sense, given Ellerbusch’s indication of the impact of what such a farming approach and fuel production area could mean to the communities that adopt such practices; jobs and the resulting regional economic impact that come from them, or, as she characterizes it, the most exciting part about her biofuels work.

The team in Florida will have planted 1,500 acres by year’s end, and completed the preparation for 3,500 acres. Even as Ellerbusch was learning, she explained that owning the intellectual property and technology rights to the entire technology process, combined with her company project’s own farming model, does certainly give BP an advantage that very few other advanced biofuels companies can match. But she still sees the importance of partnering.

“I think this is an industry that will be built off of partnerships,” she says. “We chose to purchase our partner out, but when we first came together, we had envisioned the possibility of being in biofuels, but we never really had a way of getting there because we didn’t know the technology, we didn’t have any projects, and we didn’t have any feedstocks—so we found somebody that did.” She believes the partnerships between the oil majors that have already developed will only continue, a trend she says “is another proof point for the legitimacy and ability of this industry starting to form.”

It might seem like a perfect world for Ellerbusch, given the resources she has that include nearly every project developer’s wish-list items: an R&D facility, a large demonstration-scale facility to test out the work at the R&D facility, a farming model and the land to grow, and the heritage of a company with a nearly unrivaled ability to build facilities that take something in and churn product out, product that can affect a global marketplace, on top of two letters—BP—that would seemingly excite anyone to work with her team for name recognition alone. But Ellerbusch explains that this would be wrong because even BP needs to know that its products have a secure endpoint. “This is a nascent industry and we do need to see stability,” she says. “We are not going to invest with the hope of something—we need to see that there is a viable market.” The main thing they hope to see, she says, is a stable federal renewable fuel standard. And for other companies without the B and P in their name, they need this too.

“We need to see a clear path to the fact that there will be required volumes, targeted volumes for cellulosic,” she says. And for those who argue cellulosic fuels will never be, she would point to corn-based ethanol. “Give it some time,” she says. “They had 30 years and we have had four,” referring to her work at BP. From her perspective, very few game-changing technologies are born overnight, so she wants people to realize that the industry is still in its infancy. “Don’t think you can kick us out of the house and tell us it’s time to feed ourselves, we are not ready to do that yet, we need a little bit of support.”

An oil major asking for support, however contradictory, seems to fit the status quo, but Ellerbusch argues that what her team is doing isn’t about the now, it’s about the tomorrow, a time when each site will create more than 200 permanent jobs and 600 to 800 construction jobs during the build.  “I just ask people to believe in the idea that you have companies like us and others that are really making progress,” she says. The Highlands facility will begin major construction in 2012, which means the story of BP Biofuels is far from over. One could say it has only just begun.

Author: Luke Geiver
Associate Editor, Biorefining Magazine
(701) 738-4944
lgeiver@bbiinternational.com

 

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