Shell and Cosan team up for biofuel venture

Oil industry giants Shell and Cosan have announced they are teaming up for a venture into biofuel.

The two firms will create a new company, Raizen, in the multi-million dollar deal which will become a leading producer of biofuel made from sugar cane.

Raizen will operate in Brazil, which is a global leader in the production of ethanol.

The venture will be Shell's first venture into biofuel production, although it is already one of the largest distributors of the sustainable product in the world.

Once up and running Raizen will also be involved in the distribution of biofuel, as well as over 20 billion litres of other industrial and transport fuels through Shell's service stations.

"We are building a leading position in the most efficient ethanol-producing country in the world," explained Peter Voser, Shell chief executive officer.

"Low-carbon, sustainable biofuels will be increasingly important in the global transport fuel mix," he added.

Recently, US biofuel firm Amyris announced that it will be building two commercial-sized plants in Brazil in order to expand, as the country has an ideal environment for the growth of sugar cane.