HUGE PROSPECT ON D1 OILS

D1 was originally established in 2002 to focus on the development of a portable refinery technology to produce biodiesel for the UK transport industry. During this period, it was concluded that the high cost of rape seed oil, the main feedstock for biodiesel production in Europe, renders its use commercially unattractive. As a result, D1 explored the economics, suitability and yields of a variety of specific energy crops. During 2003, jatropha curcas was identified as its feedstock of choice and the focus turned to securing output from jatropha plantations.

Jatropha was selected as D1's primary energy crop due to it's high productivity, durability and longevity. Jatropha trees can be grown on marginalised land and are durable to the elements. Furthermore, jatropha can grow in areas of minimal rainfall, although it grows better in areas of higher annual rainfall. Jatropha trees produce nuts, which contain oil, for an average of thirty years and generally have their first harvest within two years of planting. Biodiesel refined from jatropha oil complies with EN 14214, the current European standard for biodiesel. Biodiesel meeting EN 14121 specification is an approved blend when mixed with petroleum diesel.

D1 is now commercialising its D1 20 refinery able to produce eight million litres of biodiesel per annum and will utilise jatropha oil as its main feedstock. D1 believes it can maintain low production costs and produce consistent, high volume quality output through sourcing existing feedstock supplies, cultivating new yields of jatropha on existing plantations and setting up D1 20 refineries regionally. D1 is working with highly regarded agronomy and biotechnology research and development facilities in India and South East Asia and is participating in the establishment of nurseries in a variety of locations in the Asia Pacific region. These nurseries will test imported jatropha seeds against indigenous varieties to determine which will grow best under a region's climatic conditions. In addition, D1 has recently acquired the rights to a proprietary growing media which targets the specific nutritional requirements of jatropha.

The global market demand for biodiesel is growing. International energy and environmental policies have helped to create a demand for biodiesel which is estimated to reach at least 10.5 billion litres by 2010 in the European Union alone. Based on current capacity, feedstock availability and positioning in the market, the global production of biodiesel is expected to reach approximately
3 billion litres by 2010, less than one third of the projected demand in the European Union.

D1 Oils aims to become a global, sustainable, low cost producer of biodiesel and supplier of crude vegetable oil used in the production of biodiesel. To reach this objective, D1 will manage its operations regionally, securing plantation rights and establishing refinery operations in each region, thus controlling aspects of the supply chain from seed selection through to the sale of biodiesel to end customers.

To this end, D1 has established four regional operations:
UK (Teesside and London) South Africa (Johannesburg) Asia Pacific (Manila, the Philippines) and India (New Delhi).

Taken from advfn

GREAT COVERAGE IN TODAYS FT, GUARDIAN,TIMES,EXPRESS,INDEPENDANT AND DAILY MAIL ALL VERY POSITIVE WHICH AGAIN BODES WELL FOR NEXT WEEK. BELOW FT COMMENT


BP invests 56m in biodiesel crops
By Ed Crooksand Andrew Jack

Published: June 30 2007 03:00 | Last updated: June 30 2007 03:00

BP has made its second biofuels investment of the week, committing at least 56m to a joint venture with D1 Oils, the Aim-listed biodiesel producer.

The two companies are to set up a joint venture that will take over and develop D1's plantations of jatropha, a crop that can be grownon land not suitable forfood production. D1's shares rose 7.6 per cent yesterday to their highest level in almost a year, as investors welcomed a deal that put BP's vastly greater financial strength and global reach behind D1's product.

Elliott Mannis, chief executive of D1, said: "This is a transforming event for D1 . . . It is a huge validation of our business model."

Unlike some rival biodiesel producers - which buy vegetable oil on the open market and refine it into fuel - D1 aims to be a fully integrated business, planting and harvesting the oil-producing jatropha crop to provide it with feedstock.

The strategy appears to have paid off, as rising prices for rape seed, soya and other vegetable oils have heightened concerns over the viability of biodiesel companies.

This was highlighted this week as Biofuels Corporation, which has opened one of Europe's biggest biodiesel plants on Teesside, said shareholders faced a choice of a restructuring under which Barclayswould take over the business, or insolvency.

Under its deal with D1,BP will provide working capital for the joint venture through an initial 32m investment, while D1 will include its 172,000 hectares of plantations in India, Southern Africa and South East Asia.

The plan is to invest 80m over five years to accelerate the planting of jatropha. D1 had planned to add an extra 600,000 hectares to its plantations by 2011; the joint venture will add an extra 1m hectares, meaning that in four years' time the joint venture should have 1.2m hectares planted.

The appeal of jatropha, which grows in tropical and sub-tropical areas, is that it can be planted on wasteland and marginal land.

Philip New, BP president of biofuels, said: "In the field of biodiesel, clearly our view is jatropha is the key feedstock."

D1 has also granted BP an option to subscribe for new shares representing up to 16 per cent of its share capital at an average price of 251p a share, to raise up to 30m. D1's shares rose 18p to 259p yesterday.

However, Mr New said investors should notexpect a full bid for D1from BP.

The move also followsthis week's announcementof BP's investment, with Associated British Foods and DuPont, in a 200m project including a plant to produce ethanol from wheat and research into biobutanol, a more advanced biofuel.

anissut - 30 Jun'07 - 09:43 - 8432 of 8441

Great stuff. I think we will see some serious buying come Monday morning.

bonsoir - 30 Jun'07 - 10:14 - 8433 of 8441

FAB

fillyourboot - 30 Jun'07 - 10:22 - 8434 of 8441

LOCAL NEWCASTLE 'PAPER THE JOURNAL SAYS THAT SHARES SHOT UP 30% YESTERDAY DO THEY KNOW SOMETHING WE DON'T !!!! SEE NOTE AT BOTTOM FROM EVOLUTION SECURITIES EXTREMELY GOOD NEWS FORECASTING 25 MILLION BARRELS

SEE POST 8427 FOR FT COMMENT

BP invests in North green fuel producerJun 30 2007
By Iain Laing, The Journal

Alternative fuels producer D1 Oils has signed an 80m joint venture agreement with global oil giant BP to plant crops to turn into biodiesel.

The Middlesbrough company's shares shot up 30% yesterday after unveiling the deal to speed up production of jatropha, a fuel crop which can be easily grown on soil too poor for other useful plants.

It is huge vote of confidence in D1. Although the Teesside business is giving half of the planting programme to BP, together they will plant a million hectares over five years instead of the 600,000 planned.

D1, which has already planted more than 172,000 hectares in more than 20 countries, largely in Asia and Africa, will keep the science which transforms the plants into fuel.

BP will put in an initial 31.75m, and the companies will split the remaining investment in the 80m plan. D1 said it would sell some of the biodiesel, BP was likely to sell some and some would also be sold to third parties.

Under the deal, BP also has an option to buy new D1 shares, representing about a sixth of the enlarged company, at an average price of 251p.

D1 chief executive Elliott Mannis said: "This is a transforming event for D1. BP's decision to join us in this new venture is a significant endorsement of our strategy to develop jatropha for the production of sustainable biodiesel.

"It shows we have come a long way. BP's proven logistical, managerial and financial support will enable a significant enhancement and acceleration of the scope and pace of jatropha planting."

BP was one of a number of companies rumoured to be talking to D1 with a view to a possible takeover last July. But D1 never named any suitor and abandoned talks five months later, although leaving the way open for an oil company to take a large stake.


Firms like BP and other large petroleum companies are keen to secure a supply of biofuel to meet UK government regulations that 5% of automotive fuel must be made up of biofuels by 2010.


But biofuels are becoming controversial because they have put up food prices as farmers swap from producing food crops to biofuels that are often subsidised.


D1 said it hopes to raise production to 2.7 tonnes of oil per hectare from 1.7 tonnes when trees mature after five or six years.


Evolution Securities analysts said in a note that the D1 plantations should produce around 3 billion litres of crude jatropha oil per year when mature, which equalled 25 million barrels. They plan to raise forecasts as "D1 has now moved decisively to become an upstream producer".


Iain Conn, chief executive of BP's refining and marketing business, said: "This joint venture is a further milestone in our strategy to develop real avenues to contribute to global energy supplies in ways that are sustainable and progressive."

Evolution Securities analysts said in a note that the D1 plantations should produce around 3 billion litres of crude jatropha oil per year when mature, which equalled 25 million barrels. They plan to raise forecasts as "D1 has now moved decisively to become an upstream producer".

Guardian

D1 oiled up for big time

Heard of D1 Oils, the alternative fuels group? Thought not. Well listen up. It has set up a joint venture with BP to collaborate on the production of biodiesel. A company that grabs the attention of BP just three years after coming to the market is worth noting.

I was Cynic - but was too impatient to wait for JV and so sold at the bottom! Obviously regretting that now but I think a few months of dry newsflow should eventually create a buying op, this vertical curve has never been, in my experience, a good time to buy. So i will wait, or i will be proved disastrously wrong.

thanks for the updates barefoot.

Apperantly there is a large buy order that they are trying to fill......it didnt get filled today so roll on tmrw.....there is also another rumour on advfn....a guy said he was in SA recently and heard that the SA Govt had valued D1 SA at $200m dollars....if true ...and when announced....we should see another significant whooooosh!!!!

To me SA = South Africa and I cannot see for the life of me the connection between them and DOO .... to the best of my knowledge, DOO do not even have plantations there.

cynic- i was not aware of anything going on in SA re DOO either, but thinking about it it makes sense. There is plenty of (agricultural) land up there whilst SA relies a 100% on crude oil and petroleum products imports. A diversification into biofuels will politically be a massive boost

but again, so what???? ..... SA govnt may indeed promote the idea of jatropha cultivation, but that has no relevance at all to DOO

Not saying it will happen but DOO distillation units can be set up vitually anywhere and as there are plenty of hectacres to grow jatropha in SA I can see the prospects and advantages of having the units "next door". (have been out of DOO for a while but getting itchy feet again to join you lot)

don't try to rationalise DOO/SA govnt as a reason to buy ...... jatropha palm takes 7/10 years to reach full maturity i think.

that said, i am very happy with my investment in DOO, albeit that i bought (back in again) at 186 in mid Feb, and anticipate hanging in there for a while yet, though i may make a short term trade in either direction depending on the market

thot first crop after planting was about 3 years, but i stand to be corrected

you may be right, as may i be ..... asparagus are similar - lol!

cynic- just noticed that on the very first post on this thread it said "first harvest within 2 years of planting"

i think asparagus may be 3! ...... somewhere there is also a note about time to full maturity .... that apart, i repeat what i have oft said ..... this palm will grow almost anywhere and is not food stock, so double eco(nomic) advantage over ethanol from maize and/or sugar cane and/or sugar beet

so possibly the SA link is not so silly

as i wrote earlier, it's not silly that SA govnt may want to encourage the planting of jatropha, but it is far-fetched to link that somehow with DOO ...... of colurse it is not impossible that DOO will consider "making" plantations in SA, but that may not fit their game plan, given that there is plenty of room for expansion in both Saudi and India where they are already established

let's face it nobody knows so I guess time will tell. May be BP's weight will come into play as well. (just thinking up loud and not based upon anything concrete)

Excuse me guys ... but are yoo not aware that D1 are in SA....the govt valued D1 South Africa at $200m......:O)

Apparently they have done a detailed study of the company over there and that is what they value it at....

heres a link to the web site though this is not mentioned....someone who has been to SA recently heard it over there...

http://www.d1plc.com/globalZA.php