Domestic Fuel

BP has been marketing itself as “Beyond Petroleum” for several years now but it appears that Valero is vying for the top spot in “green energy”. Valero has now invested in Terrabon, a company that is developing technology to produce “green” gasoline through the conversion of trash from landfills to energy. Terrabon’s main technology for biofuels is MixAlco, an advanced bio-refining technology that converts inexpensive, non-food biomass into a “biocrude” that is then converted into chemicals and fuels such as ethanol and gasoline.

Just last month, Valero  became the largest player in ethanol ownership with its purchase of seven VeraSun Energy plants. Last year the company invested in two cellulosic companies Solix, a Fort Collins, Colorado-based company that makes biofuels from algae, and this past January, invested in ZeaChem, a Lakewood, Colorado-based company also using biomass to produce cellulosic ethanol.

Speculation about the affects of Valero’s major entry into the biofuels market is rampant. InfoCast recently hosted a Webinar, “Who Will Benefit from the Biofuel Industry’s Current Distress?” that in part discussed the industry impact of Valero’s ownership of ethanol plants. But the question is much broader than Valero’s impact. The bigger question is which of the seven sisters (Big Oil) will be next to enter the biofuels marketplace? Shell is already invested in cellulosic ethanol and Marathon has owenership in several ethanol plants. I’m not placing my bet on ExxonMobil.