Solazyme, Bunge Form JV for commercial-scale renewable oils plant in Brazil

In California and New York, Solazyme and Bunge Global Innovation announced today that they and other Bunge subsidiaries have signed definitive agreements forming a Joint Venture to build, own and operate a commercial-scale renewable tailored oils production facility adjacent to Bunge’s Moema sugarcane mill in Brazil.

The JV, which will operate under the name Solazyme Bunge Produtos Renováveis Ltda., will have an expected annual production capacity of 100,000 metric tons of oil. The facility will utilize Solazyme’s renewable tailored oil production technology, coupled with Bunge’s sugarcane supply and processing capabilities, to produce sustainable tailored triglyceride oils for use in oleochemical and fuel applications in the Brazilian domestic market. Financial terms of the agreements were not disclosed.

The facility, which will be equally financed by Solazyme and Bunge, has been designed to integrate with a new cogeneration unit at the Moema mill, and can be expanded for further production in line with market demand. Startup is expected in the second half of 2013.

Today’s announcement follows a history of collaboration between the two companies, beginning with Bunge’s 2010 equity investment in Solazyme, followed by a May 2011 Bunge-funded Joint Development Agreement (“JDA”) to develop oils that could be sold commercially.

Also in May 2011, Solazyme granted warrants to Bunge for the purchase of Solazyme shares, conditional on key milestones related to the timely implementation of the JV and plant construction. In August 2011, Solazyme and Bunge announced that they had entered into a Joint Venture Framework Agreement setting forth the preliminary terms of the JV and commencing engineering for the plant. This series of agreements has now culminated in the formation of the JV.

Solazyme CEO Jonathan Wolfson will address the Advanced Biofuels Leadership Conference this morning in Washington DC.