$500 million to fund new Bio Fuels/Alternative energy research at two top campuses announced

BERKELEY, Calif., Feb. 1 /PRNewswire/ — BP today announced it has
selected the University of California Berkeley and its partners the University
of Illinois, Urbana-Champaign and the Lawrence Berkeley National Laboratory to
join in a $500 million research program that will explore how bioscience can be
used to increase energy production and reduce the impact of energy consumption
on the environment.

BP Selects Strategic Partners for Energy Biosciences Institute

The Energy Biosciences Institute will perform ground-breaking research aimed
at the production of new and cleaner energy, initially focusing on renewable
biofuels for road transport. The EBI will also pursue bioscience- based research
in three other key areas; the conversion of heavy hydrocarbons to clean fuels,
improved recovery from existing oil and gas reservoirs, and carbon
sequestration.

‘The proposal from UC Berkeley and its partners was selected in large part
because these institutions have excellent track records of delivering ‘Big
Science’ — large and complex developments predicated on both scientific
breakthroughs and engineering applications that can be deployed in the real
world,’ said BP Group Chief Executive John Browne. ‘This program will further
both basic and applied biological research relevant to energy. In short, it will
create the discipline of Energy Biosciences. The Institute will be unique in
both its scale and its partnership between BP, academia and others in the
private sector.’

Dedicated facilities on the campuses of UC Berkeley and the University of
Illinois will house EBI research laboratories and staff. The Lawrence Berkeley
National Laboratory will carry out supporting research. Up to 50 BP staff
located on the two campuses will work in partnership with university faculty and
researchers. BP and its partners will share governance of the EBI and guidance
of its research programs.

‘We are delighted to welcome UC Berkeley, the University of Illinois and the
Lawrence Berkeley Lab to this effort,’ said Bob Malone, chairman and president
of BP America Inc. ‘We are joining with some of the world’s best science and
engineering talent to meet the world’s demand for low carbon energy. As part of
that effort we will be working to improve and expand the production of clean,
renewable energy through the integrated development of better crops, better
processing technologies, and new biofuels.’

‘BP’s award is a tribute to the scientific excellence of the Department of
Energy’s Lawrence Berkeley National Laboratory and its academic partners at the
University of California, Berkeley, and the University of Illinois at
Urbana-Champaign,’ said U.S. Secretary of Energy Samuel W. Bodman. ‘As we
continue to promote alternative energy as a means to strengthen our nation’s
energy security, it is important that private industry join in support of
research to advance President Bush’s goal of making clean [tag]energy[/tag] sources, like
bioenergy and biofuels, commercially available.’

‘We are extremely pleased that BP has chosen to partner with the University
of California at Berkeley, Lawrence Berkeley National Laboratory and the
University of Illinois at Urbana-Champaign to create the Energy Biosciences
Institute,’ said Dr. Robert J. Birgeneau, chancellor of UC Berkeley.
‘Contributing our world-class expertise in the areas of alternative energy
research and policy with BP’s ambitious vision for EBI will harness the most
creative science and innovative technologies to develop viable solutions to
global energy challenges. We are tremendously excited at the possibility this
partnership holds for solving one of the most fundamental problems that
currently faces our nations and the world.’

‘I can’t tell you how excited I am that BP has chosen UC Berkeley and
California for its new $500 Million Energy Biosciences Institute,’ said
California Governor Arnold Schwarzenegger. ‘I’m proud that the private sector
has recognized California’s leadership and commitment to clean energy. This is a
perfect complement to our new low-carbon fuel standard which will cut carbon
emissions 10 percent from our cars by the year 2020, and with research
facilities like the Energy Biosciences Institute, California will continue to be
a leader in the Cleantech industry.’

‘I thank BP for engaging the University of California, Berkeley and the
University of Illinois at Urbana-Champaign in this noble enterprise,’ said
Richard Herman, chancellor of UIUC. ‘This exciting venture allows two of the
country’s greatest public universities to work together to develop renewable
energy — an initiative that will play a critical role in the success and
security of our nation. Addressing the problems facing society is the business
of our institution. The scientists leading this important work are continuing
Illinois’ rich heritage of paradigm-changing discovery and innovation.’

‘We are extremely pleased that Illinois and our flagship public-research
university is a part of BP’s exciting new Energy Biosciences Institute, which
will advance important new discoveries to protect our environment and expand our
economy,’ said Illinois Governor Rod Blagojevich. ‘If we make these kinds of
investments now in cleaner renewable [tag]biofuels[/tag] like [tag]ethanol[/tag] and other [tag]biodiesel[/tag],
within ten years we’ll be able to produce enough energy from our own natural
resources to dramatically cut our dependence on foreign energy and help fight
global warming. That means billions of our hard-earned dollars will stay here at
home, in our economy creating more jobs, rather than leaving our country
forever. As a national leader in corn and soybean production and world-class
biofuels research and development, Illinois is uniquely positioned to advance
the vision of this new Institute. We look forward to working together with BP
and our partners in the state of California to bring even more efficient and
effective renewable sources of energy to the marketplace,’ Gov. Blagojevich
said.

    Notes to editors:

    * BP is of one of the world’s largest energy companies, providing its

      customers with fuel for transportation, energy for heat and light,

      retail services and petrochemicals products for everyday items. It is

      the largest oil and gas producer in the U.S. and one of the largest

      refiners.  The company has operations in more than 100 countries.

    * BP’s decision to devote significant resources to widening the

      availability of biofuels is part of its strategy of identifying low

      carbon or renewable fuels for the future. It follows on from the

      company’s announcement of BP Alternative Energy – a dedicated

      alternative energy business which is active in solar, wind, hydrogen and

      combined-cycle-gas-turbine (CCGT) power generation – and the

      establishment of a biofuels business within its Refining & Marketing

      Business.
    * BP is already a top player in the global biofuels market, blending and

      distributing 590 million gallons of ethanol and 70 million gallons of

      biodiesel in 2005. In 2006 BP blended 718 million gallons of ethanol

      with gasoline — a 25 percent increase from the previous year. With the

      blending and marketing of these products, along with other refined

      products, BP accounts for about 10 percent of the global biofuels

      market.
    * With current production technology, only a fraction of the oil contained

      in most reservoirs is ever recovered. Depending on reservoir quality,

      recovery rates can vary from 20 to 70 percent.   The EBI will explore

      the possibility of using biological methods to improve recovery rates.
    * Plants and other organisms can remove CO2 from the atmosphere and

      transfer it to the soil or ocean. The EBI will work on techniques to

      enhance this process.

Source: BP
BioFuels

Alternative Energy HQ was in the house when this announcement was made this week. We bring you this release in its entirety for background on the effort. If you would like our take on this deal check out this page.