Chevron getting into biodiesel production

| 2/27/2007

Chevron Technology Ventures, a subsidiary of oil company giant Chevron Corp., will enter the biodiesel production ring in March with a 22-percent stake in a renewable-fuels plant opening in Galveston, TX.

The $10-million Galveston Bay Biodiesel plant is expected to generate about 20 million gallons per year from soybeans, Chevron officials said in a statement.

Chevron officials say the operation could grow to 100 million gallons per year within a couple of years, which would make it a frontrunner among U.S. plants either under development or currently operating.

Biodiesel production in the United States hit 75 million gallons in 2005, according to the National Biodiesel Board, but that number doubled in 2006. Approximately 86 plants currently online or in development will result in that number doubling again in the next few years.

Big oil has been dabbling in the development of biodiesel production up to this point, but Chevron's move into production is a first, officials said.

Other investors in the Galveston plant include Contango Capital Biofuels Partners, Galveston Bay Biodiesel Management, Sultex, Mobius Risk Group and Beaver Creek Fund.

Chevron Corp. and its subsidiaries have invested $1 billion in renewable energy sources including hydrogen, geothermal technology, biofuels, battery systems and solar power, according to the company.