SGB: Biofuels Digest’s 2014 5-Minute Guide
SG Biofuels is a bioenergy crop company using molecular breeding and biotechnology to develop elite, hybrid seeds of Jatropha. The company has sold more than 250,000 acres of its hybrid Jatropha seed, including orders from two of the top 20 largest energy companies in the world.
SGB’s JMax Jatropha Optimization Platform draws from the world’s largest and most diverse library of Jatropha genetic material, the sequence of the Jatropha genome, molecular markers and advanced biotech and synthetic biology tools to select, test and scale elite Jatropha cultivars for unique growing conditions around the world.
Rankings
50 Hottest Companies in Bioenergy: #45, 2013/14
The Situation
Last November, SGB and Yulex Corporation announced a collaboration to establish a genomics and molecular breeding platform focused on accelerating the crop improvement of Guayule as a sustainable source of biorubber that can replace traditional tropical or petroleum-based rubber for medical, consumer and industrial markets.
With traditional rubber, the product is tapped from the tree — in this case, the shrub is harvested, rubber extracted, and the remaining biomass is available for fuels, power and other biomaterial uses, as a cellulosic biomass source.
The goal? One metric ton of product per acre per year — competitive with typical rubber yields out of Southeast Asia — by 2018-19. And progress from around half that yield between now and then.
The storyline advances the narrative for SGB, known to this point as a developer of jatropha — into a genomics-based biotechnology company that can apply its plant breeding techniques and genetics knowledge across a set of under-developed feedstocks. And says some things about guayule itself.
Major Investors:
• Flint Hills Resources (10th largest oil refiner in the United States; a wholly-owned subsidiary of Koch Industries)
• Life Technologies Corporation (NASDAQ: LIFE)
• Kitano Capital
Type of Technology(ies):
Intensive selection and breeding programs are identifying and developing the most productive, regionally adapted strains from the company’s germplasm collection. Through outcrosses to combine important traits and inbreeding to improve uniformity, considerable advancements have already been achieved.
SG Biofuels plant biotechnology program is accelerating the improvement of Jatropha through the association of molecular markers with trait genes and the development of plant regeneration, transformation and dihaploid technologies.
The company has formed an alliance with Life Technologies Corporation, a leading provider of advanced biotechnology and synthetic biology tools.
The partnership has successfully sequenced the Jatropha curcas genome, using the SOLiD™ 4.0 System by Life Technologies. Working with Life Technologies, SG Biofuels has used the sequence to generate a high quality Jatropha reference genome. The genome has been used to compare re-sequences generated from SG Biofuels’ germplasm library– to identify molecular markers and trait genes to accelerate development of elite cultivars.
Feedstocks:
Jatropha: a non-edible shrub that is native to Central America. Its seeds contain high amounts of oil that can be used for a variety of bio-based materials including biodiesel and feedstock substitutes for the petrochemical and jet fuel industries. Because it is non-edible and can be effectively harvested on marginal land that is considered undesirable for food crops, it does not compete with global food supplies.
Successful flights by Air New Zealand, Continental, Boeing, Rolls Royce and others have validated Jatropha as a superior source of jet fuel, in large part due to its superior performance at cold temperatures.
Products
Crude Jatropha oil can be used for a variety of bio-based materials including renewable diesel, biodiesel and as a feedstock substitute for the petrochemical and jet fuel industries.
Through its JMax hybrid seed product line, and patent-pending hybrid seed production methodology, SG Biofuels provides growers high yielding, uniform and profitable Jatropha seeds that have been adapted to their growing conditions. Hybrid seeds result in greater yield, uniformity and vigor while significantly reducing handling and deployment costs.
Product Cost.
SGB’s hybrid Jatropha can produce high quality Jatropha crude oil at a cost of between $99 or less per barrel today, with a clear path to reduce production costs through molecular breeding and biotechnology.
Offtake partners (if applicable)
Flint Hills Resources, Bharat Renewable Energy (BREL)
Milestones to Date
• Signed customers for more than 250,000 acres of hybrid Jatropha seed including 2 of the top 20 largest energy companies in the world, including Bharat Renewable Energy (JV of Bharat Petroleum, the second largest petroleum company in India).
• Developed industry-leading, patent-pending hybrid seed production methodology, revolutionizing Jatropha through increased yields, uniformity and reduced handling costs for growers.
• Established operations and customer relationships in Brazil and India.
Last October, SGB has signed a mandate letter with the Inter-American Development Bank (IDB) for the debt financing of its 25,000 acre Jatropha bioenergy project in Guatemala. The project cost is estimated at approximately US$76 million.
The mandate letter enables the bank and SGB to proceed with financial, technical and environmental due diligence on a project that aims to produce 6.2 million gallons of plant oil and 640,000 metric tons of biomass per year while stimulating rural economic and social development, including the creation of more than 1,000 new jobs, improved infrastructure and health and education programs.
IDB will consider participating in the financing subject to its satisfactory analysis of the project. It is anticipated that the financing package would consist of an A loan of up to US$30.6 million, to be funded by IDB and complementary financing through a B-Loan or a co-loan in a yet to be defined amount.
In April 2013, Bloomberg reported that jatropha 2.0 developer SG Biofuels is “seeking a partner in Southeast Asia or Africa and expects to complete a cooperation deal within 180 days” to expand its growth in the hot, “growing zone” for jatropha. SGB has signed up [artners with more than 250,000 acres signed up in various field trial and deployment agreements – including an agreement to trial jatropha with Bharat Petroleum in India with 86,000 acres for first phase commercial deployment following the trials — and a similar 75,000 acre deal in Brazil with a consortium including JETBIO, Airbus, the Inter-American Development Bank, Bioventures Brasil, Air BP and TAM Airlines. SGB has been relatively cagey about yields – pointing out that they will vary substantially depending on geography, but some time ago they pointed to 350 gallons per acre as a suitable target given effective site selection and cultivation processes. Even 200-300 gallons in cold regions like the United States. That’s a huge improvement over the 60 gallons of oil per acre that soybean produces.
Last March, SG Biofuels said that it had identified over two million individual genetic markers (SNPs) in its Jatropha curcas germplasm collection, confirming the non-food energy crop has a genetic diversity comparable to corn and other domesticated crops, and validating the ability to drive significant yield and performance gains through molecular breeding.
Through the use of emerging genetic technologies, SGB’s scientists have revealed that the company’s germplasm collection can be divided into a number of distinct heterotic clades, or genetically-related groupings of plants. In contrast to previous studies, these findings confirm significant genetic diversity in Jatropha which enables SGB breeders to maximize hybrid vigor by identifying the most genetically diverse parental lines to use for the creation of elite hybrid seeds. Hybrid vigor, also known as heterosis, results in higher yields, improved plant health and increased stress tolerance. SGB’s first-generation hybrids have outperformed commercial Jatropha planting materials at 13 hybrid trial sites located across Brazil, India and Central America.
Business Model: (e.g. owner-operator, technology licensor, fee-based industry supplier, investor)
Competitive Edge(s):
• JMax hybrid Jatropha seeds resulting in a production cost of crude Jatropha oil of between $55 and $65 per barrel.
• The executive management team includes direct experience at companies including DuPont’s Pioneer Hi-Bred, Syngenta, Monsanto, Diversa, Dow Agro Sciences and Chromatin.
• A fully-integrated platform providing upstream and downstream expertise, led by partnerships and investments from Life Technologies Corporation and Flint Hills Resources and an alliance with Bharat Renewable Energy.
• Hybrid seed production technology, resulting in significantly greater yield, uniformity and vigor while reducing handling and deployment costs for plantation developers.
• Customer orders for more than 250,000 acres of hybrid Jatropha seed, as well as a global pipeline of more than 1.5 million acres.
• Access to the vast biotech and synthetic biology resources of Life Technologies. A completed sequence of the Jatropha genome, accelerating the identification and development of key traits.
• Development of the world’s largest collection of Jatropha genetic material, including 12,000 unique genotypes gathered from the center of origin for the plant in Central America.
• The JMax Jatropha Optimization Platform enabling the adaptation of elite hybrid varieties of Jatropha for growing conditions around the world. Global coverage includes operations in Central America, Brazil and India.
Research, or Manufacturing Partnerships or Alliances.
• Bunge (NYSE: BG)
• Flint Hills Resources
• Life Technologies Corp (NASDAQ: LIFE)
• Bharat Renewable Energy Limited (BREL)
• Brookhaven National Laboratory
• Roundtable on Sustainable Biofuels
• Danforth Plant Science Center
• Hawaii Agriculture Research Center
Stage (Bench, pilot, demonstration, commercial)
Commercial
Category: 5-Minute Guide
