ConocoPhilips and Tyson Foods Partner to Make Diesel Fuel

Houston-based ConocoPhilips has signed an agreement with meat producer Tyson Foods to make diesel fuel from animal fat. Houston Public Radio Business reporter Ed Mayberry has more.

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Houston-based ConocoPhillips and Arkansas-based Tyson Foods will use beef, pork and poultry by-product fat to manufacture the fuel. Starting in the fourth quarter, the companies plan to make as much as 175 million gallons per year of renewable diesel, according to ConocoPhillips chairman and CEO Jim Mulva.

"Between now and then we plan to make some refining capital investments to accomodate this new feedstock. And then following the start-up we'll market the renewable fuel in the midwest area. By volume, the renewable fuel will comprise about three percent of ConocoPhillips' total diesel production in the United States. At first, that doesn't sound like much, but it is very significant."

ConocoPhillips will invest in facilities so that it can produce the fuel in several of its refineries. Tyson's Dick Bond says his company will also make capital improvements this summer so that it can start preprocessing animal fat from some of its North American rendering facilities later in the year.

"When I started working in the food business more than 30 years ago, I never dreamed that a food company would someday partner with a major energy company to produce fuel. However, times have changed, and the need for our nation to produce new sources of energy is greater than ever."

Mulva says there's been an evolution of understanding about climate change.

"We certainly ramped up our awareness and understanding as well as the science of climate change, and we've incorporated into our plans as a company--our operating plans, as well as our capital spending plans--how we address climate change. And that's the reason we came forth this past week, last week, to announce a very pro-active approach by ConocoPhillips joining U.S. CAP as well as indicating that our belief that we need to go beyond voluntary measures to address climate change. We need to have a national mandatory framework."

ConocoPhillips and several other corporations are now urging Congress to require limits on greenhouse gases tied to global warming.

"And the reason we, we like the approach to a national mandatory framework, there's some very fundamental principles at stake. One is that we think we don't want to have something like boutique fuels, where you have, in our industry we make the better part of a hundred different fuels meeting specifications in different regions of the country from one season of time to the other. We don't think it's necessarily the best thing to have 50 different states come up with an approach to climate change."

ConocoPhillips says it supports further energy efficiency and conservation and also support of research and technology. Ed Mayberry, Houston Public Radio News.

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