Venture capitalists invest $280 million in advanced biofuels in Q2 ‘08; $84 million for algae projects

Venture capital invested $280 million in advanced biofuels in the second quarter of 2008, according to the Cleantech Group.  Range Fuels, Sapphire Energy, EdeniQ, Mascoma, Aurora BioFuels, Gevo, Fulcrum Bioenergy, Greenline Industries, GreenFuel Technologies and Amyris Biotechnologies received investments, of which $1346 million went to cellulosic ethanol, and $84 million for algae biomass. The Cleantech group said that the $50 million raised by Sapphire Energy was the largest amount ever invested in an algae company.

Sapphire background

In California, Sapphire Energy debuted it’s “green crude”, a gasoline equivalent refined from algae. The company did not disclose its production process but said that it is producing 91 octane gasoline, and said that the company has planned capacity of 153 Mgy on desert land sites in the southwestern US.

The company has raised $50 million in venture capital from ARCH Venture Partners, Venrock and the Wellcome Trust of the UK. It’s research partners include Department of Energy’s Joint Genome Project; the University of California at San Diego; Scripps Research Institute; and the University of Tulsa. The company said that it will open a facility by 2011, but did not announce the location or production capacity.

GreenFuel background

GreenFuel Technologies appointed Simon Upfill-Brown as CEO, who pronounced that “algae has come of age”. The company, which shut down a closely-watched pilot project with Arizona Public Service last year over cost concerns and algae blooms, reported that it is setting up a new project with APS and is designing projects to capture CO2 by co-locating with a range of manufacturing enterprises. The company said that it has abandoned glass tube and plastic bag photo bioreactors over cost concerns and will introduce a new set of designs for its closed production process.

Algenol background

Algenol Biofuels announced an $850 million investment from Mexico’s BioFields, using the company’s technology to produce ethanol from micro-algae. The company uses a process developed by CEO Paul Woods in the 1980s to produce ethanol from algae cells, and the company says that its process bypasses the costly step of drying and pressing algae to extract oil for biodiesel.

The company said that it plans to initially produce 100 Mgy of ethanol at its first plant using saltwater, in the Sonoran Desert of Mexico, and will increase production by 2012 to 1 billion gallons, with a projected yield of 6,000 gallons per acre. The company reported that it had received $70 million from undisclosed private investors in addition to the BioFields proceeds. BioFields said that it has already signed an off-take agreement with Pemex, the Mexican state oil company.

Aurora Biofuels background

Aurora BioFuels announced that has raised $20 million in series A financing from Oak Investment Partners, Noventi and Gabriel Venture Partners. Gabriel and Noventi has participated in a seed stage round. Aurora will use technology developed by Berkeley professor Tasios Melis for an open-pond algae production system, and will produce biodiesel from algae. The company says that its process reduces the cost of biodiesel production by half, compared to current methods.

Other algae background

• In Washington state, a group of entrepreneurs, scientists and corporate executives have formed the Algal Biomass Organization to accelerate the development and commercial application of algae biomass. The group will organize the second Algae Biomass Summit in Seattle on October 23-24
• “The jury is out on all [algae systems],” Sandia National Laboratory researcher Ron Pate told Popular Mechanics.
• In Washington state, algae start-up Bionavitas said that it will take up to four years to reach commercial levels of production,
  but that its waste water treatment business is developing faster.
• In Florida, PetroAlgae said that it hoped to reach its commercial production stage next year, as algae producers begin to differentiate over varying methods of getting past the algae “shade wall” and other issues in achieving commercial scale.
• New Zealand’s Aquaflow said that it has developed a scalable method for producing and harvesting algae in the wild, and envisioned expanding to a series of 1,000 acre facilities in the US and other countries.
• A research team from the University of Texas has developed a new blue-green algae (cyanobacteria) that secretes a soft cellulose, glucose and sucrose. The team told Science Daily that the microbe “could provide a significant portion of the nation’s transportation fuel if production can be scaled up.” The cyanobacteria is grown from sunlight and salty water at facilities on non-agricultural land. The team said that the
  cellulose is a soft, gel-like type that is easy to break down, and that the microbes secrete the sugars and cellulose, making it possibly to continually harvest biofuels feedstock without destroying organisms and using powerful enzymes to extract sugars.
• In Texas, US Sustainable Energy is awaiting lab results from a test of biocrude production using 20 pounds of algae as a feedstock. The company recently ran its initial test of 20 pounds of 5% oil-content algae feedstock with 40 percent water content, and resulted in an ignitable oil product.

Free Subscription to the Daily Biofuels Digest e-newsletter

Related Stories

Venture capitalists invest $750 million in biofuels in 2007; renewable energy investment up 50 percent for year

Greentech Media said that venture capital (VC) invested $750 million in biofuels feedstocks and technologies in 2007 led by the $70 million investment in Amyris synthetic biofuels. Overall, VC investm...

Japan’s Sumitomo to invest $280 million in Brazilian ethanol

In Japan, Sumitomo disclosed to the Bloomberg news service that it is planning to invest up to $281 million in an ethanol joint venture in Brazil. The company did not disclose the partner, but said th...

Today in Biofuels Opinion: “Jet A-1 at $US172 gives a hell of a lot of people a hell of a lot of encouragement to get on and make it happen bloody quickly”

Air New Zealand Deputy CEO Norm Thompson: "Our goal within the organisation is certainly to get into a position where we could run if not all, certainly part of our domestic fleet on biofuels. Believe...

Angolan, Brazilian companies form Biocom joint venture to produce ethanol, electricity in Angola

In Angola, the Brazilian company Odebrecht agreed with Angola-based Sonangol and Damer to invest US$200 million in sugar ethanol and electricity projects in Malanje province.  The project will cove...

Galp forms venture to use oil refinery combustion gases for algae production

In Portugal, the international oil company Galp signed an agreement with the Portuguese Engineering, Technology and Innovation Institute to establish a joint venture to research the production of alga...

Brazilian conglomerate Odebrecht invests $581 million more in biofuels

Brazilian conglomerate Odebrecht will invest $581 million, via its ETH Bioenergia subsidiary, in three ethanol plants in Mato Grosso do Sul state. The plants will have a combined capacity of 15 millio...