BP has agreed to take full ownership of its Brazilian biofuels joint venture with Bunge—BP Bunge Bioenergia—for $1.4 billion, the energy company said June 20.

The acquisition, expected to close by year-end 2024 pending regulatory approvals, will give BP the capacity to produce about 50,000 bbl/d of ethanol equivalent from sugarcane across five Brazilian states. BP said it believes complete ownership will unlock further growth opportunities in the region.

The move came, however, as BP scales back plans to develop new sustainable aviation fuel and renewable diesel biofuels projects at other existing sites. Targeting value and returns, the company said it will pause plans for two projects it was considering and assess three others.

“Taken together, these changes can enable us to deliver the growth and returns we expect from biofuels, but in a simpler, more focused way,” Emma Delaney, BP’s executive vice president, customers and products, said in a news release. “This is fully in line with BP’s priorities of driving focus into the business and growing shareholder returns.”

BP said the acquisition of Bunge’s 50% interest in BP Bunge Bioenergia meets its expected returns threshold for bioenergy of more than 15% and is within its existing annual capex framework of about $16 billion in both 2024 and 2025.

The acquisition includes the consolidation of Bioenergia’s net debt and lease obligations of about $1.2 billion. The JV was formed in 2019 when the bioenergy and sugar businesses of BP and Bunge were combined.

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