Exxon Mobil Investing $600 Million in Algae-based Biofuels
The biggest shoe to drop thus far in emerging biofuels market came this week from Exxon Mobil Corp., which announced that it is making a $600-million investment in algae-based biofuels.
Exxon’s giant step into the renewable energy field came after recent announcements from BP and Shell, among others, that they were speeding up commercial development of cellulosic-based biofuels.
Exxon is partnering with biotech firm Synthetic Genomics Inc., to research and develop next-generation biofuels produced from sunlight, water and waste carbon dioxide by photosynthetic pond scum. The joint venture will create a new test facility in San Diego to study algae-growing methods and oil extraction techniques. Industry analysts said the research facility could lead to scale-up to commercial production within five years.
According to reports, the partnership will study the possibility of growing biofuel-producing organisms in open ponds and in closed photobioreactors. Synthetic Genomics has been conducting research focusing on growing algae.
Exxon officials say they aim to produce hydrocarbons that can be processed along with petroleum streams and then be used to make transportation fuels. The algae-biofuels investment marks a major strategic shift for Exxon Mobil, which for years has publicly opposed investing in renewable energy. After facing public scorn for racking up record profits — including more than $20 billion in one quarter—in the midst of a deep recession and a growing climate change crisis, the oil giant has highlighted its environmental stewardship in recent ad campaigns, including one commercial touting its research into lithium battery technology for automobiles.
Biofuel initiatives were jump-started in 2007, when a federal law was enacted expanding the national renewable fuels standard, or RFS, to reach 36 billion gallons by 2022.
Earlier this month, Algenol Biofuels Inc. announced a partnership with Dow Chemical Co. to develop a $50-million, algae-to-fuel pilot- scale plant employing Algenol’s technology, which the partners expect will be partly funded using Department of Energy grants. Bonita Springs, Fla.-based Algenol has applied for a $25-million grant under the DOE’s grant program for integrated pilot- and demonstration-scale biorefineries, with Dow Chemical signing the grant application as a collaborator in the project.