UK company to exit biofuel production - citing heavy losses, US imports
Middlesbrough, England-based D1 Oils is getting out of the biodiesel production game, blaming subsidized U.S. biodiesel imports for the move.
The company plans to shut down its newly built biodiesel refineries in Middlesbrough and Bromborough, focusing its ongoing operations on plant science and planting.
Elliott Mannis, CEO of D1 Oils, said, "2007 brought significant challenges for the biofuels industry, including rising feedstock prices, growing concerns on sustainability and imports of heavily subsidised U.S. biodiesel."
"These challenges have reinforced the imperative at the heart of D1's business strategy: the need to develop low-cost supplies of alternative, sustainable raw materials for biofuels that are not subject to the same price pressures as food-grade cereals and oil seeds."
In its preliminary results, the company reported a loss of £46.1 million for 2007, widened from a loss of £12.6 million the previous year.
The company also announced a proposed placing to raise £14.9 million to support its new strategy.
D1 Oils said it has an established plant science and planting program for jatropha, which produces an inedible oil feedstock for biodiesel and is able to make use of land not suitable for arable agriculture.
The company said subsidized biodiesel began to enter the EU in volume in the form of a 99 percent soya biodiesel and a 1 percent mineral diesel blend around the middle of 2007.
The so-called B99 is also known as "spash and dash" because of accusations that a significant amount of it is shipped to the U.S. just to add a small amount of ordinary diesel, taking advantage of government subsidies on any refining done in the States, and then shipped right back out.
D1 Oils said that it is estimated that up to one million tonnes of B99 entered the EU during 2007.
The company plans to shut down its newly built biodiesel refineries in Middlesbrough and Bromborough, focusing its ongoing operations on plant science and planting.
Elliott Mannis, CEO of D1 Oils, said, "2007 brought significant challenges for the biofuels industry, including rising feedstock prices, growing concerns on sustainability and imports of heavily subsidised U.S. biodiesel."
"These challenges have reinforced the imperative at the heart of D1's business strategy: the need to develop low-cost supplies of alternative, sustainable raw materials for biofuels that are not subject to the same price pressures as food-grade cereals and oil seeds."
In its preliminary results, the company reported a loss of £46.1 million for 2007, widened from a loss of £12.6 million the previous year.
The company also announced a proposed placing to raise £14.9 million to support its new strategy.
D1 Oils said it has an established plant science and planting program for jatropha, which produces an inedible oil feedstock for biodiesel and is able to make use of land not suitable for arable agriculture.
The company said subsidized biodiesel began to enter the EU in volume in the form of a 99 percent soya biodiesel and a 1 percent mineral diesel blend around the middle of 2007.
The so-called B99 is also known as "spash and dash" because of accusations that a significant amount of it is shipped to the U.S. just to add a small amount of ordinary diesel, taking advantage of government subsidies on any refining done in the States, and then shipped right back out.
D1 Oils said that it is estimated that up to one million tonnes of B99 entered the EU during 2007.