Atlas Oil Warns of Higher Biodiesel Cost

TAYLOR, Mich. -- With the biodiesel blender tax credit likely to expire Dec. 31, 2009, as health care reform dominates the legislative agenda, petroleum marketer Atlas Oil Co. is actively managing the potential loss of the $1 per gallon credit, but warned its retail customers to expect higher biodiesel costs in 2010 compared to 2009, the company said in a statement.
As a result, Atlas Oil is blending all of its B100 (100 percent biodiesel) supplies to B99, so customers will potentially be able to take advantage of the $1 per gallon subsidy into January. However, supplies are limited and Atlas advised customers to plan on higher biodiesel costs.
Under the biodiesel blender tax credit, there was approximately a one-cent per gallon discount on every 1 percent of biodiesel blended with petroleum diesel, according to Atlas Oil. If the tax credit is not extended, customers who purchased B20 (20 percent biodiesel blended with 80 percent petroleum diesel) should anticipate a 20-cent per gallon price jump in 2010 compared to 2009, the company stated.
In 2004, the federal government signed into law a biodiesel blender tax credit that, for the past five years, effectively reduced biodiesel prices by $1 per gallon.
Efforts to continue the tax credit are underway, Senate Finance Committee Chairman Max Baucus, a Democrat from Montana, and the panel's senior Republican, Iowa Sen. Charles Grassley, intend to retroactively pass the credit in 2010, according to a report in the Des Moines Register that was cited by Atlas Oil.
"These provisions are important to our economy -- not only because they help create jobs, but also because they are used to address pressing national concerns," the senators wrote in a letter cited by the newspaper.
The company will remain fully engaged with biofuel supply and distribution, and will continue to seek value-added solutions for each of its customers as this issue evolves, Atlas said in a statement.
In other Atlas Oil news, Atlas Oil Co., a petroleum products distributor for nearly 400 retail fuel outlets and c-store operator headquartered here, expanded its operational footprint with a new regional office in Niles, Mich., which will be staffed by 12 Atlas team members and will support of new and existing business operations throughout Southwest Michigan and Northern Indiana.

"Our strategic growth in the Michigan and Indiana markets provides a strong platform for enhancing and creating customer relationships," Bob Kenyon, vice president of sales and operations for Atlas Oil, said in a statement. "Atlas intends to unveil new value-added petroleum distribution models that will benefit all customers in the supply chain."

The 2,400-square-foot facility is headed by William Shaver, executive vice president of retail operations.

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