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A partnership between oil behemoth BP and U.S. ag-tech giant Corteva is eying a 10% share of the European Union market for green jet fuel, an optimistic signal for the broader biofuel industry facing an uncertain policy future.
“We believe renewable fuels represent one of most significant growth opportunities for agriculture, period,” Ignacio Conti, CEO of the joint venture, Etlas, told Agri-Pulse, providing fresh details on the new company announced Jan. 7.
Etlas seeks to combine Corteva’s century-old skill in seed genetics and BP’s worldwide fuel industry expertise to create a major supplier of oils from canola, sunflower and mustard for producing biofuels. Crops will be grown on existing farmland, between food and livestock feed growing seasons, similar to Indianapolis-based Corteva’s U.S. canola venture with Bunge and Chevron. Farmers will benefit from both additional revenue streams and better soil health, Conti said.
The aim is to work with farmers in growing canola and mustard in South America and sunflower in Europe starting in 2027. Crops will be crushed to create oil, which will then be tendered on the market to refiners for the production of biofuels. While the overall focus is both renewable diesel and sustainable aviation fuel (SAF), the initial push will be around SAF, according to Conti, who came to his new role from Corteva.
Ignacio Conti (Etlas photo)The attention on the hard-to-electrify aviation industry is timed to benefit from government mandates in the European Union and advanced agriculture markets and technology in South America, he said.
The EU’s mandate calls for 20% of airplane fuel to be SAF by 2035 and 70% by mid-century, up from 2% last year. “Our projections show there will be a shortage, so the time for Etlas to generate that supply is perfect,” Conti said.
"We've been monitoring the evolution of policy in different parts of the world and have very strong signals about demand and how big this could get,” he said, adding that the world likely will need 10 million tons of SAF by 2030, up from just 1 million in 2024.
Conti didn’t comment on North American biofuel policy, though he said Etlas plans to eventually start growing oilseeds in the U.S. and Canada. “We are doing the research and crops are looking promising," Conti said.
The Corteva-BP partnership follows a lull in agriculture-energy alliances compared to a flurry of such deals just a few years ago as investor interest in renewable fuels, driven by federal and state incentives, surged.
Chevron Corp.'s $3.15 billion purchase of Iowa-based Renewable Energy Group, a top biodiesel producer, in 2022 remains a high point in the convergence of Big Oil and farming. Two years later, in a blow to local growers of soybean -- a major biofuel feedstock -- Chevron closed two biodiesel plants in Iowa, citing poor market conditions amid a weak biofuel-use mandate. The oil and gas company cut biofuel jobs last year as policy uncertainty weakened demand.
Policy cloudiness
Etlas' focus on Europe and South America comes as regulatory uncertainty keeps biofuel producers and farmers on edge across the globe.
“It’s all about policy,” Advanced Biofuels Canada President Fred Ghatala said Tuesday at the Clean Fuels Alliance America conference in Orlando, Florida, when asked about Canada's biofuel growth outlook.
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“If we have policy reversal in any major renewable fuel market, then that cascades across the entire sector,” he said.
One recent example was Sweden, which reduced its renewable fuel blending rules from about 30% to 6% after electing a right-of-center government three years ago, Ghatala said.
Fred Ghatala (LinkedIn photo)Rohaise Low, director of biofuels and oleochemicals at GlobalData, agreed.
“We have seen a lot of strong indications across various different countries, but you never know, another election and things can be pulled back,” she said, noting that Brazil is able to pull back its mandate in the short term when faced with high prices.
But it’s the U.S. in the hot seat when it comes to policy frustrations voiced at this week’s gathering of Clean Fuels, a trade group representing the bio-based diesel and SAF industries.
“Let me be direct, 2025 was a brutal year for our industry,” Clean Fuels CEO Donnell Rehagen said in his opening remarks. Deep uncertainty over the so-called 45Z biofuel production tax credit “made it virtually impossible to plan and run a biodiesel business.”
Further, questions about EPA's biofuel-blending rules, along with the granting of small refinery exemptions, “created paralysis for the market” and sharply lower production, he said.
Montana Renewables CEO Bruce Fleming told Agri-Pulse earlier this month that lack of policy clarity means there's not funding for new U.S. biofuel projects.
“We are going to run into a supply shortage probably sooner than people think, particularly in SAF,” he said.
Kurt Kovarik, Clean Fuels vice president of federal affairs, said he had hoped 45Z guidance and EPA biofuel regulations would be out in time for his speech to the conference this week.
“Unfortunately, while I believe we're very close on both, neither have been delivered quite yet,” he said on Tuesday. “We can't let policy uncertainty become the new normal.”
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