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BP to Produce Jet Fuel From Crops and Waste at Cherry Point

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BP plc’s (BP - Free Report) Cherry Point oil refinery is set to launch a new sustainable energy program that will produce jet fuel from biomass feedstocks, including crops, compost, municipal waste and other by-products. As U.S. Senator Maria Cantwell announced recently, this initiative is supported by a nearly $27 million federal grant from the Federal Aviation Administration's sustainable aviation fuel (SAF) initiative.

BP’s New Era of Sustainable Fuel Production

The program is aimed at producing jet fuel from various sources such as beef tallow, soybean oil and used cooking oil. These sources are considered more sustainable compared to traditional petroleum-based fuels, as they are derived from renewable resources. BP's Cherry Point refinery, located west of Ferndale, will be the center of this innovative project.

The funding should enable BP to arrange the infrastructure and equipment needed to produce SAF for the first time. This initiative is part of a larger effort, which was led by Senator Cantwell and supported by the Inflation Reduction Act, signed into law by President Joe Biden two years ago.

Economic and Environmental Benefits of BP’s Initiative

The sustainable jet fuel project is expected to have significant economic and environmental benefits. BP officials estimate that the refinery could produce up to 10 million gallons of green jet fuel annually. This shift is not only aimed at reducing carbon emissions associated with aviation but also at supporting local economies by creating approximately 96 new jobs.

In addition to producing cleaner fuel, the project will supply airports across the Pacific Northwest via the Olympic Pipeline, which extends from Ferndale to Portland. This pipeline also supplies fuel to Seattle-Tacoma International Airport, a major hub for regional and international travel.

BP Advances Cleaner Air Travel With SAF

Senator Cantwell emphasized the significance of these projects in promoting the shift toward more sustainable air travel. She noted that the grants will initiate the production of sustainable aviation fuel to supply airports across the Pacific Northwest, aid the development of low-emission engines for cleaner regional flights, and advance technologies to reduce fuel consumption and lower costs.

With this initiative, BP's Cherry Point refinery is not only taking a significant step toward sustainability but also setting an example for the energy and aviation industries on how to adapt to the growing demand for greener solutions.

BP’s efforts at Cherry Point mark an important development in the company’s strategy to diversify energy sources and contribute to the global transition toward cleaner, more sustainable fuels.

BP’s Zacks Rank & Key Picks

BP currently carries a Zack Rank #3 (Hold).

Investors interested in the energy sector may look at some better-ranked stocks like Core Laboratories Inc. (CLB - Free Report) , MPLX LP (MPLX - Free Report) and TechnipFMC plc (FTI - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Core Laboratories, an oilfield services company, has a deep portfolio of sophisticated, proprietary products and services that positions it to take advantage of the growing maturity in the global hydrocarbon reserve base. CLB’s expanding international upstream projects indicate a positive trajectory for revenue and profitability, especially as oil demand continues to rise globally.

The Zacks Consensus Estimate for CLB’s 2024 EPS is pegged at $0.95. The company has a Zacks Style Score of B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.

MPLX derives stable fee-based revenues from long-term contracts, with minimal exposure to commodity-price fluctuations. The partnership’s robust capital expenditure forecast for 2024, along with significant expansion initiatives, underscores its commitment to sustainable growth.

The Zacks Consensus Estimate for MPLX’s 2024 EPS is pegged at $4.29. The company has a Zacks Style Score of B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.

TechnipFMC is a leading manufacturer and supplier of products, services and fully integrated technology solutions for the energy industry, with a focus on the subsea segment in offshore basins worldwide. FTI’s growing backlog ensures strong revenue visibility and supports margin improvements.

The Zacks Consensus Estimate for FTI’s 2024 EPS is pegged at $1.34. The company has a Zacks Style Score of B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.


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