UK-based biofuel specialist D1 Oils has announced that it has delivered its first batch of jatropha oil, amid early signs that the energy crop could prove more cost effective and deliver deeper cuts in carbon emissions than conventional biofuels.

The company also announced that it is on track to deliver 1,000 tonnes of jatropha oil by the end of the year through its joint venture with energy giant BP and expects to expand its plantation operations from 257,370 hectares to 300,000 hectares over the next three months.

Graham Prince, head of corporate communications at the company, said that its plant science programme to increase yields from jatropha trees was "looking promising" with selective breeding likely to lead to huge increases in yields over the coming years.

"From the wild jatropha seed the best you can expected is about 1.7 tonnes of oil per hectare, but because there has been hardly any plant science applied to the plant there is huge potential for improvement," he said. "There is enough genetic material to cross fertilise and selective breed to increase yields."

D1 Oils believes that some of the seeds it is working on could result in yields of 2.7 tonnes per hectare and Prince maintains that yields on a par with palm oil of about five tonnes per hectare could be feasible.

He added that the company's plantations were living up to expectations that jatropha can prove successful on marginal dry land unsuitable for agriculture. "We are encouraging farmers to plant on land not used for food crops such as marginal land or areas used for cash crops such as tobacco," he said. "It does not need to be planted on the high-quality arable land that is used for food crops."

Research undertaken by D1 also suggests that jatropha-based biofuels will deliver net carbon savings that are comparable with other biofuels. Price said the company was seeking a peer review of its research prior to publication, but he insisted that early signs were that jatropha-based biofuels would deliver net greenhouse gas emissions that are at least 35 per cent lower than conventional diesel.

The company is now seeking to rapidly scale up its plantation operations in response to soaring demand worldwide for an energy crop that promises to be both more sustainable and cheaper than more established alternatives.

Prince said that jatropha-based biofuel would cost between $800 (£453) and $900 a tonne, compared with about $1,200 for biofuel made from soya or rape seed. "Of all the energy crops being looked at for biodiesel, jatropha definitely looks the most attractive," he said. "The issue is now with supply rather than demand. We are looking to undertake more planting with an initial aim of selling into markets in Africa and Asia where the plantations are. As we scale up, we can look to build up a supply chain to import into Europe, though you need large production levels to start thinking about hiring tankers."