Gov. Blagojevich joins Gov. Schwarzenegger and top BP executives to celebrate launch of $500 million biosciences energy research partnership

First-of-its-kind Energy Biosciences Institute will help transform the global energy economy; builds on Blagojevich's Energy Independence Plan

[FEB. 2, 2007]  BERKELEY, Calif. -- Governor Rod R. Blagojevich joined California Governor Arnold Schwarzenegger and top executives from BP at the University of California Berkeley on Thursday to celebrate a new, innovative partnership through which BP will be investing $500 million over the next ten years to establish an Energy Biosciences Institute (EBI), the first of its kind facility in the world, to expand the energy supply and reduce the impact of energy use on the environment. BP selected the University of Illinois at Urbana-Champaign and the University of California Berkeley, two of the world's top public research institutions, along with the Lawrence Berkeley National Laboratory, to host this state-of-the-art institute, which will advance radical research aimed at probing the emerging secrets of bioscience and applying them to the production of new and cleaner energy.

University of Illinois Urbana-Champaign Chancellor Dr. Richard Herman and First Lady Patricia Blagojevich celebrated the news with state officials and university faculty at a simultaneous announcement event at the new Illinois home of the EBI on the campus of the University of Illinois Urbana-Champaign.

"We are extremely pleased that Illinois and our flagship public-research university is a part of BP's exciting new Energy Biosciences Institute, which will advance important new discoveries to protect our environment and expand our economy. If we make these kinds of investments now in cleaner renewable biofuels like ethanol and other biodiesel, within ten years we'll be able to produce enough energy from our own natural resources to dramatically cut our dependence on foreign energy and help fight global warming. That means billions of our hard-earned dollars will stay here at home, in our economy creating more jobs, rather than leaving our country forever. As a national leader in corn and soybean production and world-class biofuels research and development, Illinois is uniquely positioned to advance the vision of this new Institute. We look forward to working together with BP and our partners in the State of California to bring even more efficient and effective renewable sources of energy to the marketplace," Gov. Blagojevich said.

The Energy Biosciences Institute will perform ground-breaking research aimed at the production of new and cleaner energy, initially focusing on renewable biofuels for road transport. However, the EBI will also pursue research in three other key areas: the conversion of heavy hydrocarbons to clean fuels, improved recovery from existing oil and gas reservoirs, and carbon sequestration.

"I thank BP for engaging the University of California Berkeley and the University of Illinois at Urbana-Champaign in this noble enterprise," said Chancellor Richard Herman. "This exciting venture allows two of the country's greatest public universities to work together to develop renewable energy -- an initiative that will play a critical role in the success and security of our nation. Addressing the problems facing society is the business of our institution. The scientists leading this important work are continuing Illinois' rich heritage of paradigm-changing discovery and innovation."

Dedicated facilities on the campuses of the University of Illinois at Urbana-Champaign and UC Berkeley will house EBI research laboratories and staff. The Lawrence Berkeley National Laboratory will carry out supporting research. Up to 50 BP staff located on the two campuses will work in partnership with university faculty and researchers. BP and its partners will share governance of the EBI and guidance of its research programs.

"The proposal from UC Berkeley and its partners was selected in large part because these institutions have excellent track records of delivering 'Big Science' -- large and complex developments predicated on both scientific breakthroughs and engineering applications that can be deployed in the real world," said BP Group Chief Executive John Browne. "This program will further both basic and applied biological research relevant to energy. In short, it will create the discipline of Energy Biosciences. The Institute will be unique in both its scale and its partnership between BP, academia and others in the private sector."

The primary role of the University of Illinois at Urbana-Champaign in the Energy Biosciences Institute will be to lead the development of the new crops, cropping systems and machinery needed to provide the biomass or feedstock for the generation of renewable liquid fuels. A major part of this effort will be the application of genomic technologies to the development of these new crops. This initiative will allow the University and the State of Illinois to contribute to a cleaner environment and a nation that doesn't depend on foreign oil.

Illinois is a leading producer and among the most aggressive promoters of agriculture-based biofuels and other forms of renewable energy. Illinois is the nation's #2 ethanol producer and #2 biodiesel producer. In 2007, Illinois' ten ethanol plants will produce more than 1 billion gallons, and three biodiesel plants will produce more than 120 million gallons. Gov. Blagojevich has supported a rapid expansion of the 85 percent ethanol fueling infrastructure, and by the end of 2007, Illinois will have more than 200 E-85 pumps. In 2003, the Governor signed legislation making Illinois the first and still the only state to completely eliminate the state sales tax on E-85 and biodiesel blends of 11 percent and higher ("B11"), dramatically increasing E-85 sales and biodiesel sales.

Last summer, Gov. Blagojevich announced a comprehensive Energy Independence Plan to reduce our dependence on imported energy, which will allow Illinois to meet 50 percent of its fuel needs with alternative, homegrown sources by 2017. The Governor's plan would invest $25 million to help build five new biodiesel plants, boosting the state's production by 200 percent to 400 million gallons per year, or the equivalent to 25 percent of the state's annual diesel fuel needs, by 2017. This additional biodiesel production will generate another $225 million in business investment in Illinois.

The Governor also proposes investing $100 million over the next 5 years to build up to 20 new ethanol plants across Illinois, which would generate an estimated $1.7 billion in business investment. Additionally, the Governor proposes investing $100 million over the next ten years to build four plants in downstate Illinois using new technology to create ethanol made from plant waste materials like corn husks and wood pulp -- or "cellulosic ethanol." This means boosting the state's annual ethanol production by more than 200 percent and meeting 50 percent of gasoline needs by 2017. This plan would create almost 20,000 construction jobs and 10,000 permanent jobs.

The Governor has also made important investments in biosciences research and development in partnership with the University of Illinois. This includes $75 million for the Institute for Genomic Biology, which is expected to open this spring and to house more than 300 researchers, who will lead the basic research necessary for next-generation, advanced science-based biofuels technology. The Governor has also committed $3.2 million to design the state-of-the-art Bioprocessing Research Laboratory that will bring together academia and industry and scientific and engineering expertise to advance processing technologies and scale-up promising new biofuels technologies to assure their rapid commercialization.

Business Facilities Magazine rated Illinois the top state in the nation for biotech growth in 2005, and last April, Illinois hosted BIO 2006. This was the first time one of the world's most prestigious biosciences convention was held in the Midwest, which brought in almost 20,000 attendees from across the United States and 62 countries. The BIO conference will be coming back to Chicago in 2010.

(Energy Biosciences Institute fact sheet)

(Text copied from file received from the Illinois Office of Communication and Information)

Fact sheet

Energy Biosciences Institute

BP has entered into a partnership with the University of California Berkeley and its strategic partners -- the University of Illinois Urbana-Champaign and the Lawrence Berkeley National Laboratory -- to establish the Energy Biosciences Institute (EBI). The Institute will perform ground-breaking research aimed at probing the emerging secrets of bioscience and applying them to the production of new and cleaner energy, principally fuels for road transport. BP will invest $500 million in the Institute over the next 10 years.

Energy Biosciences Institute will:

• Be an integrated research institute dedicated to harnessing revolutionary developments in biology to achieve breakthroughs that will provide new energy solutions;

• Initially focus on renewable fuels from existing and new crop plants, but is expected to consider a wide range of applications of biology in the energy sector and address such areas as improved recovery, conversion and carbon sequestration;

• Be the world's first and only public or private institution with a focus on both basic and applied biological research relevant to energy, and it will also create the discipline of Energy Biosciences;

• Will be governed by representatives from BP, the Universities and the Laboratory, and the management team will include a director located at UC Berkeley and an associate director located at the University of Illinois.

University Partners

• UC Berkeley and the University of Illinois have track records of delivering "Big Science" -- large and complex developments predicated on both scientific breakthroughs and engineering applications, requiring the world-class, multidisciplinary, coordinated and collaborative teams. This is well aligned with the aspirations and objectives of the Institute.

• UC Berkeley will dedicate laboratory and research facilities at Calvin Hall and Hildebrand Hall while a new building is constructed. The University of Illinois will house the research and laboratories in the Institute for Genomic Biology. Lawrence Berkeley National Laboratory, located on the Berkeley campus, will also carry out supporting research.

• BP will have up to 50 company scientists and technologists located on the two campuses as it works in partnership with the universities. BP and its partners will share governance and the guidance of research programs.

• BP believes these partners, selected after a global search, offer the highest potential for breakthrough science complemented by the ability to transfer technology effectively to BP.

Institute Timeline

• The EBI research program will commence in July 2007.

• BP will conduct formal yearly assessments of progress to determine, with its partners, research priorities and funding allocation for the next year.

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Unique aspects of this Research Institute

This "first of its kind" Institute will be a fully integrated public and private sector effort requiring specific characteristics that are central to program success.

• The research must be broad in scope across the entire value chain. Experience has shown that optimizing independent elements sub-optimizes the entire system.

• The research must be interdisciplinary. Novel findings will likely lie at the interfaces of two or even three discrete disciplines, and these capabilities must be fully integrated in the program.

• The research must be mission-oriented with well defined plans, targets, and flexibility in approach to lead to rapid demonstration projects and timely commercialization.

EBI University Selection Process

BP conducted a world-wide search for potential hosts for the Institute and assessed their capabilities against specific criteria that included the following:

• World-class research capability in the relevant domains

• Access to the broader for-profit biotechnology industry

• A location to which new candidates can be readily recruited and relocated

• A demonstrated track record of working with industry on mission-oriented multidisciplinary research programs

About BP and Bioscience

• BP is a leader in the area of biofuels and is making a significant financial commitment to apply biotechnology to the energy sector.

• The initiative is well aligned with BP's stated business strategy.

• Advanced technology solutions are required for biofuels to achieve material levels of penetration in the transportation sector and to reduce greenhouse gas emissions at reasonable economics.

• "Energy bioscience" is developing rapidly, but the majority of biotechnology funding has been biomedical. BP aims to be the world leader in biofuels and industrial biotechnology applications.

• With the success anticipated, it is likely that there will be multiple integrated bio-refineries constructed using locally produced bio-mass.

• BP is one the world's largest integrated energy companies with operations in more than 100 countries.

• BP's activities include the exploration and production of crude oil and natural gas; refining, marketing, supply and transportation; and the manufacture and marketing of petrochemicals. BP also has a growing presence in gas and power and in alternative energy, including solar, wind and hydrogen power. For more information visit www.bp.com.

January 2007

(Text copied from file received from the Illinois Office of Communication and Information)