Big Oil Looks to Biofuels

The Wall Street Journal
OCTOBER 19, 2009
By GUY CHAZAN

As low-carbon fuels get pushed, BP, Shell and others invest in alternatives

The biofuels industry, hit hard by the global credit crunch, is getting a shot in the arm from a new source–the oil majors.

Among the oil companies, BP PLC and Royal Dutch Shell PLC have been the most active investors in the sector. But it's even beginning to attract more-conservative companies like Exxon Mobil Corp., whose chief executive, Rex Tillerson, once famously dismissed corn-based ethanol as "moonshine." Exxon announced in July it was investing $600 million in an algae-to-fuel start-up, Synthetic Genomics Inc.

"It was a major signal to the biofuels industry," says Bruce Jamerson, chief executive of Mascoma Corp., a producer of cellulosic ethanol, which is made from inedible plant materials.

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