Biofuel is a valuable resource, and now there's a new source in play: recycled tires.

According to a press release from Green Distillation Technologies (GDT), oil from recycled tires is one of the easiest to refine and most reliable biofuel sources around, yet it has been largely overlooked in favor of bio-oil from plants. Tim Rose, an oil expert from Southern Oil in Australia, says the potential of this source is "immense" especially considering its role in reducing the country's dependence on fuel imports and the benefits in transforming an environmental waste problem into a raw commodity.

Since 2001, Southern Oil has run a refinery in Wagga Wagga processing 38 percent of Australia's collected waste lube oil. They are currently in the process of building an advanced $16 million biofuel plant at Gladstone, Queensland.

"The first 'trickle' of oil is now being provided to us by Green Distillation Technologies tire recycling plant at Warren in Western New South Wales under a supply contract we signed this year as they now have their first processing vessel operating pending approval by the environmental authorities after which they can expand their production," Rose explained.

He added, "We have found that the oil they are providing is quite easy to convert to diesel fuel as the main refining step we have to make is the removal of the sulphur, but in time it could become a suitable feedstock for automotive petrol and even jet fuel."

Rose continued to say that the company will initially use the product as the raw material for diesel fuel that's used in stationary engines. Eventually, the plans include a specialist refinery at Gladstone. These are all in line with GDT's own plans to create 10 tire recycling plants in Australia.

GDT is an Australian company with world-class technology for recycling end-of-life cars, trucks and oversized tires into carbon, oil and steel.

This news comes as a study from the University of Michigan challenged the benefits of biofuel versus petrol, according to a report from Energy Live News. Researchers debunked the belief that biofuel is carbon neutral, discovering that crops used for biofuel actually absorb only 37% of the CO2 emissions that's released into the atmosphere in the process of burning the plants.