Jim Lane
Algae has been touted as the ultimate platform for fuels,
chemicals, nutraceuticals, proteins — even cancer therapies.
There’s been a rate of progress that would impress any devotee of
Moore’s Law — and a series of wacky claims that would impress any
devotee of P.T. Barnun.
So, what are the real trends?
We’ve traveled several years now since the “Summer of Algae” when it
seemed like half the venture capitalists in life sciences were
forming algae ventures, or thinking about them. Since then — a
cluster of research projects and proto-companies have been tackling
the real-world challenges of yield, harvesting, dewatering and
application development.
Below are the Top 10 Trends that should be commanding your
attention.
1. Big Oil, L’il algae
This past week, algae observers were startled to learn that
Reliance Industrial Investments, the Indian oil holding company,
placed a $2.4M purchase order for Algae.Tec algae production
technology as
a follow-up to an initial investment of A$1.5M by Reliance,
with additional investments of AU$1.2 million over the next 2
years. The purchase order for Algae.Tec modules will be supplied
and completed over approximately the next nine months. The
Algae.Tec solution is less than one tenth the land footprint of
pond growth options, while its enclosed module system is designed
to deliver the highest yield of algae per hectare, and solves the
problem of food-producing land being turned over for biofuel
production.
Overall, it’s Reliance’s third algae investment. A Credit Suisse
report on the company, (see page eight of the report,
downloadable here), revealed
last year that Reliance has invested a total of $116
million (Rs6.2 billion). $93.5 million (Rs5.0 billion) in Algenol
and 22.5 million (Rs1.2 billion) in Aurora Algae.
But there’s more algae activity stirring in the world of Big Oil.
In November, Sapphire
Energy and Phillips 66 announced a strategic joint
development agreement to work together to collect and analyze data
from co-processing of algae and conventional crude oil into fuels,
and to complete fuel certifications to ready Sapphire Energy’s
renewable crude oil for wide-scale oil refining.
Under the agreement the companies will expand Sapphire Energy’s
current testing programs to further validate that Green Crude can
be refined in traditional refineries and meet all of the
Environmental Protection Agency’s (EPA) certification requirements
under the Clean Air Act. This includes determining the optimal
operating conditions for processing algae crude oil into American
Society for Testing and Materials-certified diesel, gasoline and
jet fuel. Once the study is finished, the companies will work
together to complete the EPA certification process to register a
new fuel product entering the market. Sapphire Energy is now
producing crude oil daily from algae biomass cultivated and
harvested at the company’s Green Crude Farm, located in Columbus,
N.M.
Meanwhile, let’s not forget the Synthetic Genomics-ExxonMobil
relationship, which debuted in spectacular fashion with a $500M
initial spending target in 2009. Last year, SGI announced
a new co-funded research agreement with ExxonMobil to
develop algae biofuels. The new agreement is a basic science
research program that focuses on developing algal strains with
significantly improved production characteristics by employing
synthetic genomic science and technology. Financial details of the
agreement were not disclosed. Last year, ExxonMobil
CEO Rex Tillerson told PBS, “We’ve come to understand some
limits of that technology, or limits as we understand it today,
which doesn’t mean it’s limited forever. The venture is “probably
further” than 25 years away from successfully developing fuels.”
The last public update on ExxonMobil’s
algae efforts was here.
2. Making Mo’ Better
Algae is renowned for its production potential — after all, the
mass can double in as little as 24 hours — meaning that it could
dwarf the productivity of terrestrial plants. But translating
potential into industrail scale “business as usual” hasn’t been a
joyride.
Hence it was big news when, last March, Algenol confirmed
that the company had exceeded production rates of 9,000
gallons of ethanol per acre per year — and company CEO Paul Woods
said that ” I fully expect our talented scientific team to achieve
sustained production rates above 10,000 by the end of this year.”
Just last September, in the opening plenary session at the Algae
Biomass Summit, Woods revealed that the company, at its 4-acre,
outdoor Process Development Unit in Lee County, Florida, had
achieved continuous production of ethanol at the 7,000 gallon per
acre level.
It was a substantial increase over the company’s original target
of 6,000 gpa, and were achieved in outdoor operation under normal
operating conditions. With the news, Woods confirmed that the
company, after completing major construction activities at their
integrated pilot scale biorefinery in 2012, has fully shifted
focus to demonstrating the commercial viability of Direct to
Ethanol technology at its pilot facility and identifying sites for
commercial projects to begin in 2014.
3. Scale
Now, Solazyme (SZYM)
doesn’t like to think of itself as an algae company any more than
Budwesier wants to be known as a yeast company — both prefer to
define themselves by their products rather than around the details
of their fermentation technology. Nevertheless, Solazyme does use
algae fermentation — and they have been getting to massive scale.
Last month, the company announced that commercial operations have
commenced at both Archer Daniels Midland Company’s (ADM)
Clinton, Iowa facility, and the downstream companion facility
operated by American Natural Products in Galva, Iowa. Volumes
shipped to Brazil are being utilized for market development
activity in advance of the opening of the Solazyme Bunge Renewable
Oils Moema facility. As stated previously, production at the ADM
and ANP facilities is expected to ramp to a nameplate capacity of
20,000 MT/yr within 12-18 months, with targeted potential
expansion to 100,000 MT/yr in subsequent years.
The company noted, in a release, that “truckloads of product are
now shipping from the Iowa operations for use in applications
including lubricants, metalworking and home and personal care.
These shipments are being made pursuant to multiple supply
agreements as well as spot purchases, and include reorders.”
Highlighting the flexibility of Solazyme’s technology platform,
Solazyme, ADM and ANP have successfully manufactured three
distinct and unique tailored oil products at the facilities, and
products are currently being sold and distributed in both the U.S.
and Brazil.
The Clinton news is a follow-through from the news in December
2012 that Solazyme has announced the completion of multiple
initial fermentations in 500,000 liter fermenters at ADM’s
Clinton, Iowa facility — about four times the scale of the vessels
in Solazyme’s own Peoria, IL facility. That set of runs broke
through the ferment wall: namely that, hitherto, no
next-generation producer had successfully achieved linear scale-up
in 500,000 liter (or larger) fermenters. It’s simply impossible
for fermentation-based technologies to affordably produce fuels
and chemicals in small fermentation tanks — its way too much
capex, too much opex to produce, say, 10,000 liters at a time.
Also at scale in fermentation? DSM and Alltech.
3. Bring on the Apps
“We’re like the iPhone,” said Heliae CEO Dan Simon, “and
companies like Triton are bringing forward the apps”. We may
well see companies like Heliae selling licenses for its production
technology to customers who in turn license and introduce apps, to
generate fuels, chemicals, nutraceuticals, as well as complex
proteins, enzymes, and other biologics that are cost-effective and
have immediate applications in agricultural, pharmaceutical, and
other retail markets.
Progress with the “iPhone” is becoming pretty clear, with Heliae
booking $4.2M in sales already in 2014 for their raceway-based
algae growing technology, after recently completing a $13 million
demonstration plant. Although the company has equipment on site to
develop fuels from the algae, and the company has previously
turned algae into jet fuel on site, Heliae is focusing on the
growing side of the equation. The company brought in more than $1
million in revenue last year.
So, what are the hot apps?
Proteins. Almost 10 years ago, out of Dr. Steve
Mayfield’s lab at Scripps and later at the University of
California at San Diego, a series of discoveries made it possible,
for the first time, that algae could be used a platform for
synthetic biology and genetic innovation — just as yeast and
e.coli had been used for years. Now,tThere are subtle and
microscopic reasons why algae could be a platform to rival e.coli
— some related to superior folding (proteins that don’t fold
properly are generally inactive, or can become toxic or change
their function). Mayfield’s technology ultimately led to the
formation of Rincon Pharmaceuticals in 2004 to pursue
commercialization. Sapphire ultimately acquired, and pursued
proteins as a side project.
By 2010, Mayfield was reporting in Plant Biotechnology
Journal that seven
diverse human therapeutic proteins could be produced in Chlamydomonas
reinhardtii, a green alga used widely in biology
laboratories as a genetic model organism, with a 60 cents-per-gram
protein production costs. Even then, that was “about the same cost
estimates for the least expensive protein expression systems
presently available, and considerably cheaper than mammalian cell
culture,” Mayfield and his team reported at the time.
With expected improvements in the ability to express proteins in
algae, “and the continued reduction in algal biomass cost
associated with the large scale efforts to use algae for biofuel
production, we anticipate at least a ten-fold reduction in the
costs over the next few years, which should make algal protein
production the least expensive platform available.”
Ultimately, some of the old Rincon IP was spun out of Sapphire
and back to Mayfield and Pyle, who then founded Triton last fall.
Triton’s platform is known as PhycoLogix, and uses algae to
produce compounds that other organisms cannot, that can be safely
consumed without modification, and can be cultivated at large
scale inexpensively. Heliae ibvested $5M late last year.
Nutraceuticals. In September, Algaeon
announced the signing of a multi-year, multi-million dollar
supply agreement with Valensa International to provide high value
“condition specific” nutraceuticals to the marketplace. Algaeon,
in cooperation with Valensa, is using its extensive knowledge of
algae production to bring a new level of efficiency and quality
for algae-based ingredient supply to the nutraceutical market.
Algaeon will develop manufacturing processes and technology while
Valensa will produce finished form condition specific products
that will be sold to marketers with recognized brands.
DHA. This is the secret ingredient in Fish Oil
or Omega-3s sold at your pharmacy for its health benefit. In late
2011, Sofiprotéol, the industrial and financial arm of the French
plant oils and proteins sector, established a JV with Fermentalg
to “industrialize, produce and market oils from microalgae that
are rich in oils from the Omega 3 family (EPA-DHA)” — with a goal
of assuring “the development of its patented process until the
early scale-up phases of its technology.” Sofiprotéol is providing
the bulk of financing. In early 2013, it was training its focus on
“omega-3 fatty acids, coloring agents, antioxidants and
biopolymers, etc” according to an interview in Algae Industry
Magazine. A signature Series C capital raise in Q3 of this year —
which netted $16M and attracted existing investors ACE Management,
Demeter Partners, Emertec Gestion, and Picoty Algo plus new
investors IRDI and Viveris — was in support of a focus on
“industrial scale up and commercialization” of its microalgae
production for use in “animal feed, biofuels, cosmetics, food,
health, and specialty chemicals.”
Also hovering around the DHA scene is Alltech. Their major move
into microalgae dates to the acquisition of a former Martek
Bioscience plant in Winchester, Kentucky. The plant, which
contains 1.26 million liters of fermentation capacity on a 17-acre
campus, had been originally built as a yeast production plant,
then produced vitamin B2 for Coors, and ultimately was acquired by
Martek, before Alltech bought the plant for $14 million. Alltech
has publicly discussed a $200 million investment in transforming
the plant into heterotrophic algae production facility in
Winchester, Kentucky — with a focus on production of DHA. The
renovated plant opened in April 2011. Right now, the plant can
produce 20 tons of algae per 11-day campaign — a capacity of
roughly 1800 tons per year at current productivity. 1800 tons of
algae would have a theoretical maximum, at this stage, of a
theoretical maximum of 176 tons of DHA production.
Hybrid platforms. Last year, Cellana announced
the launch of its ReNew brand and ReNew Omega-3 line of
algae-based products. The ReNew brand was developed to meet the
growing demand for more sustainable Omega-3 human health products,
animal nutrition products, and biofuel feedstocks. The ReNew
portfolio is comprised of four main product categories: ReNew
Omega-3, including both ReNew Omega-3 products includes ReNewEPA
and ReNewDHA, ReNew Feed as a nutritional product for the animal
feed market; ReNew Fuel as an algae-based biocrude, particularly
for jet fuels for commercial and military aircraft; and ReNew
Algae, available in bulk for customers to apply their own
extraction technologies and develop customized solutions within
these application areas. The ReNew product line is derived from
Cellana’s scalable, sustainable, and patented ALDUO algae
production technology. Cellana’s six-acre Kona Demonstration
Facility on Hawaii’s Big Island has produced more than nine tons
of algal biomass for commercial testing. At this time, Cellana is
raising money for a commercial-scale facility.
Another company with multiple product lines is Aurora Algae.
Aurora burst onto the scene in June 2008 with the announcement
that it had raised $20 million in series A financing from Oak
Investment Partners, Noventi and Gabriel Venture Partners. The
company completed an 18-month pilot in early 2009 and said that it
has more than doubled the productivity of its selected strains. By
August 2013 Aurora said it was looking to move its planned
commercial-scale project algae project to Geraldton, Australia
where it already has a test project. It has stated that it needs
to expand from 6-acre system to 250 acres to be commercially
successful.
The company’s key technology – an optimized strain of salt-water
algae that is lighter in color than wild-type algae—allows deeper
penetration of sunlight, thereby extending the zone for algae
reproduction and increasing yield. That’s the Aurora secret sauce:
to outcompete, as a form of crop protection, simply to grow too
fast for predators and competitors to get a foothold. The four
product lines are: A2 Omega-3—a family of Omega-3 oils aimed at
the nutraceutical and pharmaceutical markets. The first offering
in this family, A2 EPA Pure will make the benefits of EPA
available to a broader market since it is derived from an
allergen-free, vegetarian source. Plus, A2 Feed—a family of
protein-rich algal grains for the animal and aquaculture markets;
A2 Fuel—a family of biomass and biodiesel applications; and A2
Protein—a family of protein-rich powder products for the food and
beverage industry.
4. No more venting money, er, I mean CO2.
Then there’s the flue stack — which you might as well call the
Money Stack, becasue of all the money that is vented every time a
company vents CO2. One of the most interesting plays in algae to
use it as a means of monetizing CO2 ‚— turning it from a headache
into an opportunity.
BioProcess
Algae is helping Green Plains Renewable Energy to scale up
its CO2-based algae experiment into a commercial-scale add-on
facility. What started out as a lab test that grew and grew until
it reached 400 ft-long greenhouses has led to Omega-3 production
as well as high value pellets and feed selling from $1,500 to
$10,000 a ton, compared to $200 a ton for corn. Omega-3 activity?
The company in 2012 announced a commercial supply agreement for
EPA-rich Omega-3 oils with KD-Pharma for use in concentrated EPA
products for nutritional and/or pharmaceutical applications.
5. Extremophiles
New algae — or rather, undiscovered or otherwise
under-appreciated algae — well, algae companies and research
organizations have their scouts traveling even more obscure paths
than a major league baseball scout.
One of the hottest areas for development — extremophiles.
Organisms that love unusual heat or pressure conditions that make
them very robust in algae growth systems (for example, algae that
can tolerate hot temperatures can out-compete other swimmers in
the pond). So, consider this: scientists
are researching the production of oil-producing algae, as
well the feasibility of commercial-scale biofuel production based
on microbes discovered in Yellowstone National Park.
Part of a multi-institutional project funded by a grant through
the Sustainable Energy Pathways program at the National Science
Foundation, it is one of many algal biofuel research projects at
MSU. The
project, which also includes the University of North Carolina
and the University of Toledo, is part of a federal effort to
tackle some of the fundamental problems in developing enough
biofuels fuels to provide up to 50 percent of the nation’s
transportation fuel. The U.S. Department of Energy funding the
project.
6. The Pyromaniax
Hitherto, most algae systems have relied on extraction. That is,
grow the algae, dewatering, then extract the valuable oils or
proteins. But a number of ventures, such as Sapphire Energy and
Algenol, are
looking to pyrolylze the whole algae or algae residues.
In Washington state, engineers
have created a continuous chemical process that produces useful
crude oil minutes after they pour in harvested algae. The
research by engineers at the Department of Energy’s Pacific
Northwest National Laboratory was reported recently in the journal
Algal Research. In the PNNL process, a slurry of wet algae is
pumped into the front end of a chemical reactor. Once the system
is up and running, out comes crude oil in less than an hour, along
with water and a byproduct stream of material containing
phosphorus that can be recycled to grow more algae.
With additional conventional refining, the crude algae oil is
converted into aviation fuel, gasoline or diesel fuel. And the
waste water is processed further, yielding burnable gas and
substances like potassium and nitrogen, which, along with the
cleansed water, can also be recycled to grow more algae. The
system runs at around 350 degrees Celsius (662 degrees Fahrenheit)
at a pressure of around 3,000 PSI, combining processes known as
hydrothermal liquefaction and catalytic hydrothermal gasification.
Cautionary note? The PNNL system runs continuously, processing
about 1.5 liters of algae slurry in the research reactor per hour.
So, it’s pre-pilot. And it is not going to be cheap to build out,
at scale, a system that requires 350 degrees and 3000 PSI.
Along those lines, Sapphire and Linde announced
last year that they will expand their partnership to
commercialize a new industrial scale conversion technology needed
to upgrade algae biomass into crude oil. Together, the companies
will refine the hydrothermal treatment process developed and
operated today by Sapphire Energy at pilot-scale. In addition,
they will jointly license and market the technology into an
expanded list of industries, including algae, municipal solid
waste, and farm waste, in order to upgrade other biomass sources
into energy. The agreement spans a minimum of five years through
the development of Sapphire Energy’s first commercial scale,
algae-to-energy production facility.
7. One word. Plastics.
What about new materials? Plastics have been promising. In
December, the
Institute for Plastic Technology in Valencia profiled its EU
program looking into various materials that can be produced from
algae to create adhesives, paints and dyes using a
technology developed by Alicante-based Biofuel Systems. The
42-month research program includes 13 different companies. The
first stage of the project will be to identify fast-growing
algae to later be processed.
8. Scrubbers
Then, there is algae’s abilities not only as a product, but as a
platform for scrubbing wastewater — which has been a use for algae
for years. But recently, algae’s abilities to scrub out highly
toxic materials has been put to the test.
Last month in Japan, a research group led by Yoshihiro Shiraiwa
of the University of Tsukuba identified
seventeen microalgae,aquatic
plants and algae that are able to efficiently remove radioactive
cesium, iodine and strontium from the environment were identified. The research was
conducted to deal with the The findings add to existing
bioremedial options which could help to decrease radiopollution
in the Fukushima area.Such measures are of utmost importance,
because a large quantity of radioactivity has been released. The
researchers noted that further studies are needed on the mass
cultivation and efficient coagulation and sedimentation of these
algal strains before their findings can be put into practice.
Plus, there are tools to keep the algae ponds free of pests,
predators, competitiors and the like. Along those lines, in
November OriginOil
announced that academic testing has verified its new Algae
Screen growth optimizer effectively controls bacteria and
microscopic predators in commercial algaeproduction, helping to promote high rates of cultivation
of the most valuable species. “Initial test results saw a
dramatic drop in contaminant load while the culture still
maintained target cell integrity,” said Dr. Matt L. Julius of
the Department of Biological Sciences at St. Cloud State
University in Minnesota. “This is one technology that will
change the industry once it is fully validated.”
9. Kelp is On the Way
What about macroalgae, also known as kelp? In California, researchers
from Bio Architecture Lab published in the journal Nature an
alginate monomer transporter they discovered that will help to significantly
boost the efficiency of cellulosic ethanol production from brown
macroalgaes. Using fermentation, the researchers were able to
achieve 83% theoretical yield from the sugars.
Several years ago, BAL
and Norway’s Statoil announced a wide-ranging strategic
partnership for the production of renewable, sustainable and
low cost ethanol derived from macroalgae grown off the coast of
Norway. Statoil will fund BAL’s research and development (R&D)
and demonstration projects, and if successful, will also fund the
commercialization of BAL’s technology in Norway and elsewhere in
Europe. During the initial phase of the partnership, BAL is
responsible for developing the technology and process to convert
Norwegian seaweed into ethanol. Statoil is responsible for
developing and managing the seaweed aquafarming operations, with
consultation from BAL, which already has established aquafarming
operations in Chile. Upon the successful achievement of key
milestones, Statoil and BAL would develop a demonstration scale
facility in Norway.
10. Building the better
mousetrap
algae.
Final trend? Bulding a better algae through genetic enhancement.
That work has been mostly undertaken by Sapphire, which has been
engaged in some brute force biology to get the industry going.
In late 2012, for example, Sapphire Energy and
Institute for Systems Biology announced a strategic partnership
to significantly increase oil yield and improving
resistance to crop predators and environmental factors in order to
further the advancement of commercialized algae biofuel
production. “Sapphire is dealing with one of the most complicated
problems known to humans: how to make fuel from a renewable
resource,” said Nitin Baliga, director of Integrative Biology at
ISB. ”Together, we have complementary expertise that will allow us
to understand, reverse engineer and rationally alter the gene
networks for fuel production in algae.”
But the effort continues elsewhere. Last November in Tennessee,
researchers at Vanderbilt University have
found that when the biological clocks of cyanobacteria were
stopped in their daylight setting, the amount of several
biomolecules that they were genetically altered to produce
increased by as much as 700 percent when grown in constant light.
“We have shown that manipulating cyanobacteria’s clock genes can
increase its production of commercially valuable biomolecules,”
said Carl Johnson, Stevenson Professor of Biological Sciences at
Vanderbilt University.
Jim Lane is editor and publisher of Biofuels Digest where this
article
was originally published.
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