ExxonMobil has been slow to invest in biofuels. Actually, until now, they have not invested in them at all while their competitors have spent the last year making what they hope are strategic investments. Well, slap me silly, but today ExxonMobil announced a $600 million investment with J. Craig Venter (best known for mapping the human genome) whose company, Synthetic Genomics is developing a photosynthetic algae biofuels program. This venture includes more than $300 million invested in Synthetic Genomics specifically and $300 for other projects Venter is developing. This investment should cover five-to-six years of research.
Now, I should clarify, that the partnership is with ExxonMobil Research and Engineering Company (EMRE) just like ExxonMobil Chemical Company is working with Electrovaya to produce the Maya 300. It’s not unusual for the oil companies to use or create offshoot companies for their renewable energy investments. For example, Valero, which has been extremely active in biofuels investments now has a division branded as Valero Renewables.
As reported by Earth2Tech, Emil Jacobs, vice president of R&D for Exxon’s Research and Engineering Co., said in a call with reporters that it will likely take billions of dollars in additional investment to commercialize the technology for distribution in Exxon’s existing infrastructure. Within 5-10 years, Jacobs expects the project to be producing “large quantities” of transportation fuel.
Algae has been hailed by many as the “silver bullet”. But can enough biofuels be produced from algae to make a difference? Venter thinks so. He notes that traditional methods of turning algae into fuel require the “harvesting” of the algae. Algal cells are grown, harvested, and then bioprocessed to recover the lipids from within the cells. However, SGI sets its self apart in that it has engineered algal cells to secrete oil in a continuous manner through their cell walls, thus facilitating the production of algal fuels and chemicals in large-scale industrial operations. In other words, you continue to produce oil from the same algae plant. You don’t need to continually grow and harvest new algae crops to produce oil.
Venter predicts that it is going to take billions of dollars to bring large amounts of algae to market as a replacement for gas at the pumps. ExxonMobil is not alone in its financial support of Synthetic Genomics. BP (aka Beyond Petroleum) is also invested in the company but when you total the two investments together, the company is still “billions” short of the funds it needs to create and refine the process.
There is a great possibility that other technologies will come to market faster and other oil companies are investing in different technologies. With the exception of Valero’s purchase of several corn-based VeraSun plants, all the investments by the oil companies are for advanced biofuels or cellulosic ethanol.
Here is a current list of oil company investments in biofuels:
- ExxonMobil – Venter, Synthetic Genomics
- BP – just announced a partnership with DuPont to develop butanol; Qteros, Verenium, Synthetic Genomics
- Valero – purchased seven VeraSun plants out of bankruptcy earlier this year; Qteros, ZeaChem, Solix
- Marathon – Mascoma (also backed by GM)
- Shell – Iogen
- Total - Gevo
Despite the sizable number of investments by oil companies, the only one currently selling cellulosic ethanol to consumers is Shell. They just announced a pilot program in Canada with Iogen, to sell E10 made from switchgrass.
In the not so distant past, people were concerned that the oil companies were going to destroy the biofuels industry. Today, it appears that the oil companies are actually going to help the biofuels industry succeed. Why? Because the current administration has high hopes for the country’s energy independence vis a vis biofuels. Besides, the oil companies aren’t going to let other companies make all the money now are they?