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ConocoPhillips [NYSE:COP] and Tyson Foods, Inc. [NYSE:TSN] will announce a strategic
alliance at 12 p.m. CDT today to produce and market the next generation of renewable
diesel fuel, which will help supplement the traditional petroleum-based diesel fuel
supply. The alliance plans to use beef, pork and poultry by-product fat to create
a transportation fuel. This fuel will contribute to America’s energy security and
help to address climate change concerns.
Over the last year, the companies have been collaborating on ways to leverage Tyson’s
advanced knowledge in protein chemistry and production with ConocoPhillips’ processing
and marketing expertise to introduce a renewable diesel to the United States. Tyson
will make capital improvements this summer in order to begin pre-processing animal
fat from some of its North American rendering facilities later in the year. ConocoPhillips
also will begin the necessary capital expenditures to enable it to produce the fuel
in several of its refineries. The finished product will be renewable diesel fuel
mixtures that meet all federal standards for ultra-low-sulfur diesel. Production
is expected to ramp up over time to as much as 175 million gallons per year of renewable
diesel.
“We are firmly committed to leveraging our leadership position in the food industry
to identify and commercialize renewable energy opportunities,” said Richard L. Bond,
Tyson president and chief executive officer. “This strategic alliance is a big win
for the entire agricultural sector because it paves the way for greater participation
of fats and oils in renewable fuels.”
“ConocoPhillips believes the key to a secure energy future is the development and
efficient use of diverse energy sources,” said Jim Mulva, ConocoPhillips chairman
and chief executive officer. “This alliance will provide a new and significant contribution
to our nation’s domestic renewable fuel supply. It also offers an excellent opportunity
to use our company’s manufacturing expertise and advanced technology to help increase
the supply of renewable fuels and to reduce greenhouse gas emissions.”
Using a proprietary thermal depolymerization production technology, the animal fats
will be processed with hydrocarbon feedstocks to produce a high-quality diesel fuel
that meets all federal standards for ultra-low-sulfur diesel. The addition of animal
fat also improves the fuel’s ignition properties, while the processing step improves
its storage stability and handling characteristics.
Investments made by ConocoPhillips and Tyson will allow for the processing and handling
of fat and enhance the ability of the United States to produce energy from a variety
of sources, including domestically-produced vegetable oils.
The processing technology was developed at ConocoPhillips, culminating in a successful
test at the company’s Whitegate Refinery in Cork, Ireland. ConocoPhillips began
commercial production of renewable diesel using soybean oil in Ireland late last
year.
This alliance is expected to be a positive step for Tyson’s long term financial
performance. “Production is expected to begin in late calendar year 2007, ramping
up through spring 2009,” Bond said. “Once at full production, we currently project
between $0.04 and $0.16 cents per share in additional annual earnings. However,
this will be driven by factors such as the prices of wholesale diesel and animal
fat."
Benefits of Renewable Diesel
•Produces lower life-cycle carbon emissions
•Increases energy security by using a domestic and renewable energy source
•Can be used in today’s vehicles
•Can be produced and distributed with existing refineries and fuel distribution
systems
•Refinery quality control systems ensure product quality
ConocoPhillips
ConocoPhillips is an integrated energy company with interests around the world.
For more information, go to www.conocophillips.com.
Tyson Foods
Tyson Foods, Inc. (NYSE:TSN), founded in 1935 with headquarters in Springdale, Arkansas,
is the world's largest processor and marketer of chicken, beef, and pork, the second-largest
food production company in the Fortune 500 and a member of the S&P 500. The company
produces a wide variety of protein-based and prepared food products, which are marketed
under the "Powered by Tyson(tm)" strategy. Tyson is the recognized market leader
in the retail and foodservice markets it serves, providing products and service
to customers throughout the United States and more than 80 countries. The company
has approximately 107,000 Team Members employed at more than 300 facilities and
offices in the United States and around the world. Through its Core Values, Code
of Conduct and Team Member Bill of Rights, Tyson strives to operate with integrity
and trust and is committed to creating value for its shareholders, customers and
Team Members. The company also strives to be faith-friendly, provide a safe work
environment and serve as stewards of the animals, land and environment entrusted
to it.
ConocoPhillips and Tyson Foods Inc. will hold a press conference at 12 p.m. CDT.
To access the live audio broadcast, go to www.conocophillips.com or http://ir.tyson.com.
For additional information about the ConocoPhillips-Tyson alliance, go to www.conocophillips.com/et/tyson-cop/
or www.tyson.com/tyson-cop.
CONTACTS (ConocoPhillips):
Bill Tanner (news media) 281-293-2801
Gary Russell (investors) 212-207-1996
CONTACTS (Tyson):
Gary Mickelson (news media) 479-290-6111 or 479-236-9022
Ruth Ann Wisener (investors) 479-290-4235
CAUTIONARY STATEMENT FOR THE PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995
This press release contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are statements that contain projections about revenues,
income, earnings and other financial items, plans and objectives for the future,
future economic performance, or other projections or estimates about assumptions
relating to these types of statements. These statements usually relate to future
events and anticipated revenues, earnings, business strategies, competitive position
or other aspects of operations or operating results. In many cases you can identify
forward-looking statements by terminology such as “anticipate,” “estimate,” “believe,”
“continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “should,”
“will,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,”
“effort,” “target” and other similar words. However, the absence of these words
does not mean that the statements are not forward-looking. The forward-looking statements
are based on the expectations, estimates and projections of Tyson and ConocoPhillips
about their respective businesses and industries in general on the date this statement
was released. These statements are not guarantees of future performance and involve
certain risks, uncertainties and assumptions that are difficult to predict. Further,
certain forward-looking statements are based on assumptions as to future events
that may not prove to be accurate. Therefore, actual outcomes and results may differ
materially from what is expressed or forecast in such forward-looking statements.
Economic, business, competitive and regulatory factors that may affect Tyson’s and
ConocoPhillips’ business are generally as set forth in their filings with the Securities
and Exchange Commission (SEC). Neither Tyson or ConocoPhillips are under any obligation
(and expressly disclaim any such obligation) to update or alter these forward-looking
statements whether as a result of new information, future events or otherwise.
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