Biotech Values

[DewDiligence]

Exxon and Craig Venter Ink Biofuel Collaboration Based on Algae

[According to Exxon, algae can yield 2,000 gallons of biofuel per acre per year compared to only 250 gallons per acre per year for ethanol derived from corn.]

http://blogs.wsj.com/environmentalcapital/2009/07/14/biofuels-bonanza-exxon-venter-to-team-up-on-algae/

›July 14, 2009
By Keith Johnson

Exxon’s $600 million deal with Synthetic Genomics to brew fuel from algae could mark a coming of age for alternative fuels.

As human-genome mapper Craig Venter, now the chief executive of SGI said, turning algae into biofuel simply won’t happen without Big Oil’s deep pockets. He said it was the biggest program he knows of worldwide to produce biofuels.

At the same time, both Exxon and SGI were at pains to stress that the “collaborative research project” is in its early phases. “There’s no guarantee of success,” said Exxon’s vice-president for R&D, Emil Jacobs. “We’re giving a new reality to the timelines” of algae biofuel development, Mr. Venter said.

Exxon and SGI are teaming up to crack the problem of turning abundant algae into affordable transport fuel. The companies will spend the next five or six years on the three biggest challenges: Finding the most suitable strain of algae; figuring out the best way to grow it; and figuring out how to mass produce it economically within the existing energy infrastructure.

Mr. Jacobs said Exxon chose algae after an extensive search for the most suitable biofuel. The biggest advantages of algae, he said, are that it doesn’t require arable land or fresh water, and algae consumes carbon dioxide. That means any algae project could go hand-in-hand with other energy-sector projects to capture emissions from, say, power plants or cement factories.

The Exxon/SGI venture offers a twist on traditional methods of turning algae into biofuel. The companies are trying to tweak the algae to excrete a “hydrocarbon-like” liquid that can be run through existing refineries and turned into transportation fuel. Other algae-to-oil methods basically squeeze the green plants and grab the plant oil they extract.

The project, which will kick off with a new research facility in San Diego, still offers little clarity on the big questions.

Exxon’s Mr. Jacobs said it would be “five to ten years” before small-scale plants are up and running. And neither company wanted to put a price tag on the fuel produced from algae, which with today’s technology is still vastly more expensive than gasoline.‹