D1 Oils founder resigns after share debacle; says media, analysts unable to distinguish sustainable and unsustainable fuels

In England, the founder of jatropha pioneer D1 Oils announced his resignation as a director after news of a new capital raise caused shares of the company to plunge 40 percent. Karl Watkin said that the media and analysts were unable to distinguish between sustainable fuels and unsustainable fuels, and were lumping D1 unfairly with companies with unsustainable practices.

Friends of the Earth told the UK’s Guardian newspaper that D1 was unrealistic about jatropha, and it was this that caused the share meltdown. The advocacy group said the jatropha was poisonous, grown in an unsustainable manner and were realizing smaller yields than initially projected.

D1 Oils said that it would raise up to $60 million in an additional sale of shares, to fund ongoing cash needs as it builds up its jatropha-based biodiesel production capacity. The company said that competition from subsidized US biodiesel had hit the company’s trading margins, resulting in the recent run-down in the share price as well as generating the need for new cash. The company reported a loss of $20 million in its most recent reporting period.

In February, the CEO of D1 Oil told the Reuters Global Agriculture and Biofuel Summit that the company can produce jatropha biodiesel profitably as long as the price of oil exceeds $65 per barrel. The company is planting 50,000 hectares of jatropha, in a joint venture with BP, in Africa, India and Southeast Asia, and the seedlings are expected to be fully mature in 5-6 years. With a projected yield of 650 gallons per hectare, the company will have developed more than 32 Mgy in jatropha capacity by 2012.

D1 Oil is planting 50,000 hectares of jatropha, in a joint venture with BP, in Africa, India and Southeast Asia. D1’s CEO said that the company can produce jatropha biodiesel profitably as long as the price of oil exceeds $65 per barrel, and will have developed more than 32 Mgy in jatropha capacity by 2012.

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