Thursday, September 29, 2011

Australias backyard teaming on Algae Biotechnology-Algae Biofuels!

Companies, operating in Outback Australia, personify promise and hardiness in the microalgae corner of industrial biotech
The birth, life and death of a global micro-algae industry has been written so many times that it must seem to many readers like a microscopic version of Buddhist reincarnation, the lifecycle of the phoenix, or out-takes from the motion picture Groundhog Day.
It has all the elements of classic literature. Promising strains plucked from obscurity by sometimes mysterious benefactors, like the stories of Oliver Twist or Pip; tales of prodigal powers of growth, presumed fortune and mis-spent youth, out of the chronicles of young Prince Hal and Falstaff; and lost opportunity and regret straight out of Sentimental Education.
Gumption and Darwinian times
But out of all literature, it is the qualities that Margaret Mitchell essayed in Gone With the Wind that most closely apply to the entrepreneurs, renowned investors, gold-diggers, celebrated scientists, quacks, loyal supporters and camp followers who have tackled the development of micro-algae, plankton and cyanobacteria as an alternative to fossil oil and gas. We live not in Dickensian times, but in Darwinian days.
“What qualities are in those who fight their way through triumphantly that are lacking in those who go under?” Mitchell wrote. “I only know that the survivors used to call that quality ‘gumption.’ So I wrote about the people who had gumption and the people who didn’t.”
Of the approximately one zillion people, companies, science-based organizations, governments, or lunatics out for an airing that have taken up the development of micro-algae, the survivors share one thing in common with the microcellular strains they have found or enhanced – and that is a remarkable level of gumption indeed. They live in Darwinian conditions indeed.
Three ventures, with operations located in Australia, personify those qualities of gumption as well as any three in the world: MBD Energy, Muradel and Aurora Algae.
For sure, there are numerous other ventures utilizing micro-algae as a platform technology or as the end product – Martek, Aquatic Energy, Solazyme, Aquaflow Bionomic, Phycal, Cellana, Sapphire Energy, Solazyme, Solix, and AlgaeTec just to name an impressive few out of the many that have been profiled over the years in Biofuels Digest. Not to mention an array of research institutions and consortia working on DOE, DARPA or other governmental and private research projects.
Out in the Never-Never
But there’s something so highly appealing about these three companies, operating in the “Never-Never” of outback Australia. They have as hardy a tale of survival in the wilderness as the celebrated novel We of the Never-Never, that in 1908 first popularized the “survival against the odds” genre of outback Australia tale-telling.
Where are they? MBD, developing in South-Eastern Queensland in the shadow of the coal-fired Tarong Power Station about 200 kilometers northwest of Brisbane; and two, Muradel and Aurora, along the forbidding northwest Australian coastline at Karratha, in Western Australia.
Australia’s prized economic success stories, its massive coal and iron mining industries, are the source of the CO2 for all three ventures, though Aurora Algae and Muradel are working with open-pond systems, while MBD is working with carbon capture strategy to grab CO2 from power station flue gas. Flat, open land and plenty of sunshine – well, Australia is long-renowned for having plenty of both.
The water? In the case of the closed systems of MBD, the water source is less critical in nature, but in any case Queensland is the wettest state in the country, and as well known for its floods as other parts of the country are known for searing drought. In the case of Muradel and Aurora Algae, they are focused on saline algae, and have the (essentially unlimited) source of the Indian Ocean near to hand.
Muradel
Muradel is remarkable, in a world fitfully awash in cash-laden algal research operations, for having constructed their first micro-pilot on a budget of $2,000, cobbled together out of the resources of the University of Adelaide and Mudroch University (hence, “Muradel”). $3.3 million in funding subsequently arrived for a full-scale pilot, which was constructed up in Karratha, and Muradel Pty Ltd was incorporated in December 2010 as a joint venture between Murdoch University, Adelaide Research, Innovation Pty Ltd and SQC. The company is now going through the process of raising cash for a demonstration of its technology.
“We have achieved production rates of 50 tonnes per hectare per year,” Project Leader Professor Michael Borowitzka from Murdoch University told the Adelaidean last year, “over half of which is converted to oil. These high production rates are expected to increase at the new pilot plant due to the even better climatic conditions in Karratha.” Head engineer David Lewis, of the University of Adelaide, confirmed at the Alternative Fuels Summit that the project’s pilot is fully operational and meeting project goals. Last year, Muradel indicated that it had brought biofuels production costs to under $4 per kilo.
Aurora Algae
Aurora Algae recently completed the raising of another $22 million, bringing its total fund raise to $72 million so far. The company has moved away from being a biofuels pure play to focusing on nutraceuticals. The newest funding round will go towards the building of its first commercial scale plant in Australia.
Aurora Algae announced that it has awarded the initial engineering contract for design and construction for the Company’s commercial facility in Maitland, Western Australia.
Recently, the company announced an option agreement on over 1,500 acres of land located near its demonstration facility in Karratha. With the award of the initial engineering contract, Aurora Algae is one step closer to constructing a full-scale commercial facility equipped to manufacture thousands of tonnes of algae-based biomass annually.
The Aurora process is expected to produce 15 tonnes of biomass per month in the demonstration plant from 6 one-acre ponds, suggesting that volumes could increase to 37,500 tonnes of algal biomass per month at a maxed-out commercial facility. At 25 percent oil content, that could provide up to 33 million gallons of algal oil in addition protein and feed biomass. By contrast, 15,000 acres of soybeans would generally provide less than 1 million gallons of vegetable oil.
MBD Energy
Last year, the Queensland state government announced a $1 million investment for a trial which uses algae to soak up carbon emissions from a coal fire power station. Premier Anna Bligh said Tarong Power Station near Kingaroy will be the first coal-fired power station in Australia to try the technology as part of the $5 million MBD Energy Limited Tarong trial.
Ms Bligh said that as part of the trial MBD Energy would start construction on a one hectare algal biomass display plant beside Tarong Power Station, 180km north-west of Brisbane, in December.
Premier Bligh said MBD Energy had also agreed to build facilities next to power stations in Victoria (Loy Yang A) and New South Wales (Eraring Energy), with construction underway first at Tarong.
The Tarong Power Station test plant, once fully built, is expected to capture about 700 tonnes per annum of CO2, produce one tonne of algal biomass per day, 120 tonnes per annum of algal oil and 240 tonnes per annum of algal meal by 2012. Ultimately, MBD expects to expand the facility to 80 hectares by 2013, producing 3 Mgy of algal based fuel and up to 25,000 tons of algal meal.
The closely-watched algal technology developer OriginOil is a strategic partner and supplier to the MBD Project. OriginOil announced in January that it received its first commercial order to deploy its algae oil extraction system in an industrial setting. MBD Energy (MBD) recently committed to purchase an initial OriginOil extraction unit for piloting at one of Australia’s three largest coal-fired power plants. MBD Energy expects OriginOil technology to support a pilot Bio-CCS (Bio-based Carbon Capture and Storage) algal synthesizer system at Queensland’s Tarong Power Station.
Separation technologies, bioreactors and more: special microalgae features
Investing in Innovation, and betting against it
The progress of these three companies, out in the Never-Never, not to mention the persistent innovation n the space represented by the technical artucles we are publishing today, brings us to the “never, never”so often uttered by investors, declining participation in the latest algal project submissions from developers around the world.
Is “No” a safe answer? Isn’t “No” a bet on the future of technology, just as much as check invested in a venture is a bet. – only is is a bet against algae as a fuels, chemicals, feed, nutraceuticals or food platform.
It is a bet against gumption itself and, as we have seen in the case of Solazyme (where the Seties B investors – the $8 million round that is not unlike Muradel’s needs, in scope, bought in for $1.01 per share, for a stock selling for $14 today), there is a lot more non-buyers remorse going around than buyer’s remorse.