Once the operation is completed, scheduled for the end of 2024, BP will acquire full ownership of Bioenergia of the Bunge brand
The oil company BP agreed with the cereal company Bunge to buy a 50% stake in the Brazilian sugar and ethanol joint venture BP Bunge Bioenergia for US$1.4 billionin a bid for the growing demand for low-carbon biofuels.
Once the operation is completed, scheduled for the end of 2024, BP will acquire full ownership of Bioenergia, which has a production capacity of about 50,000 barrels per day of ethanol equivalent from sugar cane.
BP will consolidate Bioenergia’s debt and obligations worth $1.2 billion, it said, which means it will pay a total of US$800 million to Bunge, according to Reuters calculations.
The acquisition comes as there is growing investor concern about BP’s strategy, after rating agency S&P Global revised its credit outlook downwards earlier this month, citing slower-than-expected debt reduction.