BP is to invest at least pound stg. 32 million ($76 million) in a joint venture with D1 Oils, the quoted British-based alternative fuels company, to develop the inedible oilseed jatropha as a biodiesel.

The move escalates BP's move into alternative fuels, following its $US400 million ($471 million) investment in a joint bio-ethanol plant with Associated British Foods and DuPont announced earlier this week.

BP will provide working capital into the new 50-50 joint venture, D1-BP Fuel Crops, through an initial pound stg. 32 million equity investment, while D1 provides 1.9 per cent of its net assets. BP has options to buy a further 16 per cent for a further pound stg. 30 million.

The plan is to invest pound stg. 80 million over five years with accelerated planting of jatropha, which grows in tropical and sub-tropical areas, on wasteland and marginal land. D1 will provide exclusive use of its "Elite" jatropha seeds and seedlings, for which it will receive a premium price.

Iain Conn , CEO of BP's refining and marketing business, said: "This joint venture is a milestone in our strategy to develop real avenues to contribute to global energy supplies in ways that are sustainable."

Elliott Mannis, CEO of D1 Oils, said: "This is transforming for D1. BP's decision to join us in this new venture is a significant endorsement of our strategy to develop jatropha as a global raw material for the production of sustainable biodiesel."

D1 has already planted or obtained rights to 172,000ha of jatropha in India, southern Africa and Southeast Asia.