Tyson, ConocoPhillips to join in renewable fuel efforts
April 16, 2007
by FoodBusinessNews.net Staff
SPRINGDALE, ARK. — Officials with Tyson Foods, Inc. and Houston-based ConocoPhillips on Monday announced the companies’ plans to produce and sell renewable diesel fuel produced from Tyson’s supply of byproduct fat from its beef, pork and poultry processing facilities. The two companies said negotiations on the deal have been going on for the past year and now both companies are making capital investments at selected facilities to begin processing animal fat in a way that will produce renewable transportation fuel as a supplement to petroleum-type diesel fuel traditionally used. The companies said the mixture will be categorized as "ultra-low-sulfur diesel," and production goals are to begin making the fuel later this year and produce up to 175 million gallons of renewable diesel fuel per year by 2009.
"We are firmly committed to leveraging our leadership position in the food industry to identify and commercialize renewable energy opportunities," said Richard Bond, president and chief executive, Tyson. "This strategic alliance is a big win for the entire agricultural sector because it paves the way for greater participation of fats and oils in renewable fuels."
Mr. Bond said the diesel production part of the business will serve to boost its shareholders’ investments.
"Once at full production, we currently project between 4c and 16c per share in additional annual earnings," he said. "However, this will be driven by factors such as the prices of wholesale diesel and animal fat."
Jim Mulva, chairman and c.e.o. of ConocoPhillips, added, "ConocoPhillips believes the key to a secure energy future is the development and efficient use of diverse energy sources. This alliance will provide a new and significant contribution to our nation’s domestic renewable fuel supply. It also offers an excellent opportunity to use our company’s manufacturing expertise and advanced technology to help increase the supply of renewable fuels and to reduce greenhouse gas emissions."
The production process uses thermal depolymerization technology and the animal fats will be processed with hydrocarbon feedstocks to produce the diesel fuel. Officials said the addition of animal fat improves the fuel’s ignition properties and the processing step improves its storage stability and handling characteristics.