JV to build UK biofuel plant

Associated British Foods PLC
26 June 2007


                          Associated British Foods plc


              ABF in joint venture to build £200m UK biofuel plant



For immediate release



Associated British Foods plc ('ABF'), the international food, ingredients and
retail group has today announced that it has reached agreement with BP and
DuPont on an investment to build a world-scale biofuel plant in the UK.  A joint
venture will be formed, subject to regulatory approval, to build the plant and
operate the business.  ABF and BP will each hold 45% of the joint venture and
DuPont will hold the remaining 10%.



The plant will produce bioethanol from wheat and will be built at a cost of
£200m at BP's chemicals site at Saltend, Hull.  Its capacity will be 420m litres
(330,000 tonnes) of bioethanol per year and is planned to come on stream in late
2009.  ABF expects a return on its investment ahead of its cost of capital in
the first full year of operation.



The plant will initially produce bioethanol, but the partners will look at the
feasibility of converting it to biobutanol once the technology is available.  BP
and DuPont intend to build a jointly funded biobutanol demonstration plant,
which will run in parallel with the main plant, to support this objective.



It is expected that formal agreements will be entered into by the joint venture,
after its formation, with other ABF businesses: Frontier Agriculture and AB
Agri.  The supply of locally grown wheat would be arranged by Frontier which is
the UK's leading grain marketer and supplier of agricultural inputs.  The major
co-product of bioethanol production, distillers' grain, would be sold to AB
Agri.  It will use its highly specialised sales and marketing business, which
sources and develops co-products from the food, drink and energy industries, to
market the distillers' grain as an alternative feed for livestock.



This announcement follows the previously announced investment by British Sugar
to build the UK's first bioethanol plant at Wissington, Norfolk.  Its capacity
will be 70m litres (55,000 tonnes) of bioethanol a year, using sugar beet as a
feedstock, and the plant will start production next month.



The European Investment Bank is finalising its approval for the provision of
£120m of project financing for both of ABF's biofuel investments at attractive
interest rates.  This would be the first direct financing provided by the Bank
for a biofuel project.



George Weston, Chief Executive of Associated British Foods, said,

'This exciting project will make ABF the major producer of biofuel in the UK.
Its announcement reflects our confidence in our sugar and agricultural
businesses, in our partners BP and DuPont and in the government's commitment to
biofuel production.'



For further information please contact:

Associated British Foods                           [phone]
John Bason, Finance Director


Citigate Dewe Rogerson:                            [phone]
Jonathan Clare/Chris Barrie/Fiona Bradshaw



There will be a press conference at 09.30 on 26 June 2007 at:
BP plc, 1 St James's Square, London SW1Y 4PD




Notes to editors



1.      Associated British Foods is a diversified international food,
ingredients and retail group with global sales of £6 billion and 75,000
employees.  It is listed on the London Stock Exchange with a market
capitalisation of £7.2 billion.  It operates in 46 countries with significant
businesses outside Europe in Southern Africa, the US, China and Australia.


Its aim is to achieve strong, sustainable leadership positions in markets that
offer potential for profitable growth.  It strives to achieve this through a
combination of organic growth, the acquisition of complementary businesses and
achievement of high levels of operating efficiency.  The group has established a
track record of successful value adding acquisitions including Illovo Sugar, AB
Mauri (its leading international yeast and bakery ingredients business),
Littlewoods stores for Primark and the grocery brands Mazola and Ovaltine.


2.      British Sugar is a substantial business within ABF.  It has operations
in the UK, Poland, China and Southern Africa which process some 4 million tonnes
of sugar annually.  It is recognised as the most efficient sugar producer in
Europe and has a proven ability to create value through improvement in
agricultural yields, operational efficiencies, co-product development, marketing
and product innovation.  A number of its operations are already successful joint
ventures.  It has world class production facilities and technical expertise.
Wissington in Norfolk is the largest and most efficient beet sugar factory in
the world and is the site for the UK's first bioethanol plant.


3.      AB Agri (Associated British Agriculture) is the UK's largest and most
successful agri business supplying technology driven products, including animal
feeds, and services to improve agricultural efficiency.  Its products are sold
worldwide and it has established a successful feed manufacturing business in
China.  Its KW Trident business is the UK's market leader in the sourcing,
development and marketing of food, drink and energy industry co-products.
Co-product feeds are a developing part of livestock feeding and KW Trident are
at the forefront of this development.


4.      Frontier Agriculture is the UK's leading grain marketer and supplier of
agricultural inputs.  It operates from 36 sites in the UK and has a revenue of
£650m.  Frontier was formed in 2005, through the merger of Allied Grain and
Banks Cargill Agriculture, and is owned in equal shares by ABF and Cargill.
Frontier works closely with farmers to advise on crop selection and agronomy to
manage for optimum yield and quality.  It offers farmers a unique opportunity to
grow for specific markets with contracts tailored to suit them.  An
understanding of the whole supply chain enables Frontier to develop creative
solutions to overcome the challenges faced by both farmers and end-users.




                      This information is provided by RNS
            The company news service from the London Stock Exchange