Shell, Iogen drop plans biofuel plant in Manitoba

Shell, Iogen drop plans for biofuel plant in Manitoba

6:40 AM, 15th May 2012
Shell, Iogen drop plans for biofuel plant in Manitoba

LONDON, UK/OTTAWA, CANADA: Royal Dutch Shell and Iogen Corp have scrapped plans for a commercial-scale biofuel plant in Manitoba, spelling the loss of 150 jobs and raising questions about widespread and near-term use of fuel made from agricultural waste in Canada. Cellulosic ethanol is made from the non-food portion of crops. Ethanol production from food grains, especially corn, has generated debate about the ethics of diverting food for use in fuel and has been a key reason why US corn stocks are projected to fall to a 16-year low this summer. Chicago corn futures prices hit a record peak last summer and remain historically high.

The Iogen Energy joint venture had been studying building a plant to make ethanol from straw and other plant waste, rather than from food crops such as corn and sugar. Shell first invested in Iogen 10 years ago and the partners have operated a demonstration plant in the Ottawa area since 2004. “The decision by Shell and Iogen doesn’t threaten the future Canadian biofuels production, it’s just like any other fuel, and it takes time to build up the necessary capital to implement. While I am personally disappointed, I don’t see this decision as a threat to the industry in general,” said Scott Thurlow, President, Canadian Renewable Fuels Association.

© Reuters News

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