x Abu Dhabi, UAEMonday 22 January 2018

Exxon invests $600m in fuel-from-algae scheme

International Together with genetic sequencing pioneer Craig Venter, Exxon hopes to eventually produce petrol from seaweed.

Rex Tillerson, who heads the world's biggest international oil company, has dismissed biofuel from food plants as "moonshine" and told shareholders he would avoid the business, as he was not an expert in agriculture. But on Tuesday, the Exxon Mobil chief executive agreed to invest US$600 million (Dh2.2bn) over six years in a project to develop biofuel from microscopic plants. The research alliance with Synthetic Genomics, a private US firm owned by the genetic sequencing pioneer Craig Venter, is Exxon's biggest financial commitment to date on renewable energy. It will draw on the petroleum company's existing skills and infrastructure.

"Our goal is to produce a new source of oil," Emil Jacobs, Exxon's vice president for research and development, told reporters. "It could be possible to convert it into gasoline and diesel in existing refineries, transport it through existing pipeline and sell it at existing retail stations." Exxon and Synthetic Genomics hope to develop strains of single-celled algae ? a plant group that also includes seaweeds ? that can harness sunlight to make oil from carbon dioxide and other chemicals at high enough rates for commercial biofuel production.

But that goal could be many years away from being realised. "We need to be realistic," Mr Jacobs said. "This is not going to be easy, and there are no guarantees of success." Mr Venter, who is best known for his work on sequencing the human genome, said the venture would be the biggest of its kind in the world, and may prove that algae are a more efficient fuel source than corn and other food plants currently used in biofuels production, usually with the help of government subsidies.

The algae would be cultivated either in open ponds or enclosed in incubators designed to provide optimal levels of sunlight, carbon dioxide and nutrients, so would not compete with food crops or forests for land. The microscopic plants would not even need a clean water supply, as many strains thrive in brackish or waste-water, and even in sewage ponds. Better yet, many algae naturally produce oils that can be processed into fuel, although not fast enough for commercial operations. But Mr Venter believes that with financial backing from Big Oil, Synthetic Genomics can leverage its genetics expertise and proprietary technology to develop designer cell strains that pump out oil more efficiently.

A first step will be setting up a research facility near San Diego, California, which, with a sunny climate and strong scientific community, is already a hub for algal biofuel start-up ventures. The agreement with Exxon "represents a comprehensive, long-term research and development exploration into the most efficient and cost effective organisms and methods to produce next generation algal biofuel," said Mr Ventner. "We are confident that the combination of our respective expertise in science, research, engineering and scale-up should unlock the power of algae as biological energy producers in methods and scales not previously explored."

Mr Tillerson has been one of the existing biofuel industry's biggest critics, and has left Exxon on the sidelines as rivals such as BP, Chevron and ConocoPhillips launched initiatives to find better biofuel alternatives. Studies by groups including OPEC and the UN's Food and Agriculture Organization have implicated the commercial production of fuels from crops such as maize, sugar cane and soy beans in pushing up food prices and contributing to global warming by encouraging deforestation.

But for many of the world's biggest petroleum companies, the lure of potential new oil supplies that could be processed and sold without requiring big infrastructure investments has proved irresistible. It also resonates with populist demands, including some from the companies' own shareholders, for oil companies to invest more in renewable energy development. Although at an earlier stage than the quest for fuel from so-called cellulosic sources, such as vegetable waste from agriculture and forest industries, algal biofuel development has an extra attraction for western-based oil producers that are under heavy pressure to reduce carbon emissions. That is because the microscopic plants thrive under enhanced atmospheric concentrations of carbon dioxide. Siting algal fuel incubators next to oil refineries could therefore provide a way to use carbon dioxide emissions and to offset the cost of capturing them.

Mr Jacobs said he expect to see commercial-sized test plants within five to ten years. "This is very early. We have a lot of work ahead of us," he added. The Carbon Trust, a UK government agency that last October launched the world's biggest publicly funded algal biofuel project, projects that 70 billion litres of fuel per year could be produced from algae by 2030, equivalent to 12 per cent of global jet fuel consumption or six per cent of diesel used for road transport.

"Algae are potentially an attractive means to harvest solar energy," said John Loughhead, the executive director of the UK Energy Research Council. "Perhaps they'll be the stem cells of the energy world." tcarlisle@thenational.ae