Sustainable Aviation Fuel, 2

Part
01
of two
Part
01

Sustainable Aviation Fuel 2, Pt. 1

Shell Oil Company is a subsidiary of Royal Dutch Shell and is one of the world's largest oil companies. Amyris is a company that produces a large array of products, including biofuel, from sugarcane. These points and more can be found in more detail in the attached spreadsheet.

Summary

  • Shell Oil Company has a revenue of $89.88 billion and produces up to 20,889,114.4 tonnes of fuel a year.
  • One major recent news story concerning Shell Oil Company is the loss of a $63 million lawsuit to the City of Atwater about tainted water.
  • Shell Oil Company has a key partnership with the National Fish and Wildlife Foundation, which has funded around 270 projects that managed over 155,000 acres of habitat.
  • Amyris has a revenue of $14 million and produces approximately 42,250 tonnes of bio-jet fuel annually.
  • Amyris is a company with a wide portfolio, selling itself as an innovative company that uses sugarcane to solve many of the world's problems in industries such as fuels, solvents, drugs, lubricants, and nutraceuticals.

Research Strategy

To find information about the Shell Oil Company and Amyris, we depended mainly on their respective websites and data-driven websites such as Bloomberg, Nasdaq, Statista, Seeking Alpha, etc. One part of our search that wasn't so straightforward was the search to determine what their key partnerships are. We mainly looked for innovative partnerships such as open innovation partnerships (joint ventures) and other types of strategic partnerships that benefit all parties. If we didn't find these kinds of partnerships, then we looked for partnerships that were mentioned many times in publications around the web. Another part of our search that wasn't so straightforward was determining fuel production.

We had trouble finding the exact revenue for U.S. Company Shell Oil Company, which is a subsidiary of Royal Dutch Shell based in The Hague, The Netherlands. Our search began by looking through online reports on websites such as Bloomberg, Biz Journals Forbes, Vault, Hoovers and other data-driven and business news websites. We realized that many of these sites use Shell Oil Company interchangeably with Royal Dutch Shell, and they will even say Shell Oil Company is based in The Hague when it is actually based in the U.S. The exception here was Vault, which stated that Shell Oil's revenue made up 13% of Royal Dutch Shell's total revenue. However, this couldn't help because this figure was from 2013. We searched for other sources to back up Vault's assertions but weren't able to find any other sources, even from around 2013 that backed this up. With this, we changed strategy.

In this strategy, we decided to look through a few years' annual reports from the parent Royal Dutch Shell company to see if we could see how large the revenues of Shell Oil Company are inside of its parent. We also tried to look for annual reports for Shell Oil Company itself, but we came up empty there as all the annual reports pointed to Royal Dutch Shell. In the latest Royal Dutch Shell annual report, it was apparent that Shell Oil Company was one of dozens of companies and subsidiaries that Royal Dutch Shell owns. In the report, revenue was consolidated and not displayed under its subsidiaries. There were no percentages either, so we were not able to determine the revenues of Shell Oil Company this way, hence we changed strategy.

In this strategy, we looked to see if we could calculate the figure, possibly by using proxies. Shell Oil Company is the flagship of Royal Dutch Shell's oil operations in the United States. Based on this fact, we used some data that showed regional breakdown of Royal Dutch Shell's revenue. We noted that in the chart, the United States was the only country that is analyzed and shown. Revenues are broken down mainly by continents and larger regions and considering Shell Oil Company is the largest subsidiary for Royal Dutch Shell, we believed that this showed that we could use the United States figure as a proxy for Shell Oil Company's revenue. We were not comfortable reporting Shell Oil Company's revenue as the same as Royal Dutch Shell's, but more research outside of the scope of this research needs to be done to determine if the legal setup of these companies do allow for the revenues of the parent and subsidiary to be reported interchangeably.

With the same assumptions made before about the region's connection with Shell Oil Company, we used the North American figure for oil production to determine an approximate figure for the Shell Oil Company's production. Production is 153,146,000 barrels in North America, so to convert this to metric tonnes, we used a conversion table to help calculate the figure:
153,146,000 barrels * 0.1364 = 20,889,114.4 tonnes.

We used the table again to calculate the fuel production for Amyris in metric tonnes:
13,000,000 gallons * 0.00325 = 42,250 tonnes.
Part
02
of two
Part
02

Sustainable Aviation Fuel 2, Pt. 2

Syntroleum Corporation (now known as Renewable Energy Group) is a leader in providing biofuels for the transportation industry in North America. Fulcrum BioEnergy is a leader in using municipal solid waste in making low-carbon fuel at a very efficient cost. These points and more can be found in more detail in the attached spreadsheet.

Summary

  • Renewable Energy Group has a revenue of $2.387 billion and produces up to 1,631,500 tonnes of fuel a year.
  • Renewable Energy Group positions itself as a company that is not only leading in the biofuels industry but a company that can help its customers turn a profit while helping the environment.
  • They produce a wide spectrum of biofuels and low-emission fuels including biodiesel, renewable diesel, ultra-low sulfur diesel, blended fuel, ethanol, and gasoline.
  • Fulcrum BioEnergy has a revenue of $33.491 million and produces up to 975,000 tonnes of fuel a year.
  • Fulcrum BioEnergy positions itself as a pioneer, or front-runner, in the manufacture of low-cost fuels from household garbage.

Research Strategy

To find information about the Renewable Energy Group and Fulcrum BioEnergy, we depended mainly on their respective websites, data-driven websites, and biofuel publications such as Biomass Magazine, CSI Market, Nasdaq, etc. One part of our search that wasn't so straightforward was the search to determine what their key partnerships are. We mainly looked for innovative partnerships such as open innovation partnerships (joint ventures) and other types of strategic partnerships that benefit all parties. If we didn't find these kinds of partnerships, then we looked for partnerships that were mentioned many times in publications around the web. This was seen in the case of the partnership between Broco Oil and REG as it was mentioned frequently on sources such as Bloomberg, Biodiesel Magazine, etc. Another part of our search that wasn't so straightforward was determining fuel production and revenue.

The fuel productions of both Renewable Energy Group and Fulcrum BioEnergy were displayed in gallons, hence, we needed to do conversions. We used a conversion table provided by BP to calculate these figures.
Renewable Energy Group: 501,700,000 * 0.00325 = 1,630,525 tonnes
Fulcrum BioEnergy: 300,000,000 * 0.00325 = 975,000 tonnes
Sources
Sources

From Part 01
From Part 02