1st March 2010

Europe’s largest wheat refinery despatches first shipment of sustainably produced bioethanol

The first tanker of sustainably produced bioethanol has been despatched from the UK’s and Europe’s largest wheat biorefinery which recently started production.

The cargo, which has been sold to Shell as part of a long term deal, will help Britain cut carbon emissions from road transport and meet its renewable fuel obligations from UK sources. Annual production of the new £250 million Ensus biorefinery on Teesside is expected to meet about a third of the UK requirement under the Renewable Transport Fuels Obligation, which requires 3.5 percent of all transport fuel to come from biofuels in 2010-11. The saving in carbon emissions will be equivalent to taking 300,000 cars off the road. The plant will also produce 350,000 tonnes a year of high protein animal feed, which will replace imports.

Alwyn Hughes, Ensus CEO, said “This is a milestone for UK production of biofuels and a beacon of hope for the burgeoning green industry on Teesside. We congratulate all those who have been involved”.

“This is a win,win,win for the environment, UK jobs and the economy at large”.

“We are taking in animal feed wheat, of which the UK has a large surplus, and refining it into bioethanol and high protein animal feed. At the same time, we are capturing all the carbon dioxide we produce for use in the food and beverage industries.”

James Smith, the  Chairman of Shell UK, which is taking all the output of the plant on a ten year contract, said, “It is great to see the start up of this major new plant producing bioethanol to be used by Shell. The Ensus plant is a strong step in the right direction for UK energy security and CO2 emission reduction. It’s good for jobs and for the UK balance of payments.”

All the wheat for the plant will be supplied by Glencore Grain UK Ltd, who will also market the high protein animal feed. Keith Davies, MD of Glencore Grain UK Ltd said “this plant is a major boost for UK agriculture and will provide valuable support for both cereal growers and livestock farmers”.

The plant, at Wilton on Teesside has cost  in excess of £250 million with a further £60 million of investment from associated companies. It will use 1.2 million tonnes of wheat to produce over 400 million litres of bioethanol and 350,000 tonnes of high protein animal feed per year. It will support over 2,000 jobs directly and indirectly in agriculture, transport, engineering and supporting services.

It has been financed by private equity companies The Carlyle Group and Riverstone Holdings and a consortium of banks.

Under the Government’s Renewal Transport Fuels Obligation as amended in April 2009, all transport fuels must contain 3.5 percent of biofuels in 2010-11 rising to five percent in 2013. Currently most biofuels used in the UK are imported.