The Pentagon’s Defense Logistics Agency (DLA) has signed a contract to purchase 450,000 gallons of drop-in biofuel, making the largest purchase of the energy source in the history of the U.S. government.

Navy Secretary Ray Mabus and Department of Agriculture Secretary Tom Vilsack announced the plans yesterday. The biofuel will be used in the Navy’s 2012 demonstration of a carrier-based Green Strike Group.

The Navy, which uses 1.2 billion gallons of fuel annually, has been trying to shift to greater use of biofuel to support homegrown sources and reduce military dependence on foreign supplies of fossil fuels.

DLA will purchase biofuel made from a blend of used cooking oil from Louisiana-based Dynamic Fuels, a joint-venture of Tyson Foods [TSN] and Syntroleum [SYNM], and algae produced by Solazyme [SZYM].