I have only half-jokingly commented before that the ideal microorganism for energy production would consume garbage and excrete gasoline, which would float to the top of a reactor to be skimmed off via a low-energy process. Technically, there isn’t any reason that this shouldn’t be feasible. It’s just a matter of understanding the metabolic pathways, and successfully doing the genetic engineering. But to put that into perspective, it is probably also technically feasible to engineer humans to use photosynthesis for energy, or to engineer a blueberry tree. In other words, technically feasible is often a long way from imminently doable.

But there has been a flurry of stories this week about another venture backed by Vinod Khosla called LS9 which bills itself as the renewable petroleum company and is promising something not too far from what I have described above. A story this week by David Roberts of Gristmill captures the highlights:

LS9 promises ‘renewable petroleum’

The process is the same as making cellulosic ethanol insofar as cellulosic feedstocks are converted into fermentable sugars, and those sugars are placed in a fermentation vat. The difference comes in the microbes doing the fermenting. With ethanol, it’s generally some form of yeast. The researchers at LS9 have engineered their own microbes, lifting genes from other microbes and recombining them into an organism that does just what they want. In this way they can precisely tweak the characteristics of the resulting fuel.

Yeast fermentation produces ethanol, which mixes with water and subsequently has to be extracted via distillation. LS9’s microbes produce — via fatty acid metabolism, in a process I won’t claim to understand — hydrocarbons (the building blocks of petroleum). These hydrocarbons are immiscible, i.e., they don’t mix with water. Instead, they float to the top of the vat, where they can essentially be skimmed off. That allows LS9 to skip the distillation process, which saves a whole boatload of energy. (That’s where most of the claimed 65% energy savings comes from.)

There is certainly no reason to think that this isn’t technically feasible. After all, the human body produces fatty acids that have a chemical structure that involves long-chain hydrocarbons. It is not far-fetched to accept that organisms can be engineered to produce very specific hydrocarbons. And I do think this is a much better approach than producing ethanol that requires an energy intensive distillation to remove the water.

Roberts writes:

Can you be more concise?

Sure. LS9 has genetically engineered microbes that will eat sugar and crap oil.

Naturally, this all piqued my interest. Since several news releases referred to “patents pending”, I went and searched the United States Patent Office for published applications. After an hour of searching, I came up empty. But, that’s not necessarily a negative indicator. I have had patents that took a while to work their way through the process. It just means that it is harder to understand whether there is more hype here than warranted, because the technical details aren’t in the public record. I wrote to LS9, and they responded back immediately and said 1). They read this blog; and 2). No, their applications aren’t yet published.

So, thwarted on that front, I started looking through their web site in search of 1). Advertised job openings; and 2). The specific skill set of the team they have in place. Both of these things can tell you a lot. If they are advertising for a lot of public relations types and are skimpy on looking for scientists and engineers, then my suspicion is raised. Likewise if they are very generic about available openings. But, they did have specific advertised openings for those sorts of technical positions. So I view that as a positive.

On the second item, the background of the team can tell you a lot. In order to have a good chance at success, I would expect that they are putting together a team knowledgeable about specific metabolic pathways for microorganisms. I found that. Again, as soon as their web site is back online, I will be more specific.

At this stage, I see no reason to doubt their claims, but you essentially have to take them at their word. But I give very good odds that even if they don’t pull this off, someone will. I will try to update this story as more information comes out.

A bit of additional reading:

Making Gasoline from Bacteria

Producing hydrocarbon fuels is more efficient than producing ethanol, del Cardayre adds [Stephen del Carayre, VP for R&D], because the former packs about 30 percent more energy per gallon. And it takes less energy to produce, too. The ethanol produced by yeast needs to be distilled to remove the water, so ethanol production requires 65 percent more energy than hydrocarbon production does.

At least they have their facts in order. Of course all of those who insist that it is more energy efficient to produce ethanol than gasoline aren’t going to like that.

I have mentioned LS9 here on several occasions, because I think what they are trying to do is pretty cool. They are trying to engineer bacteria that can consume biomass and excrete hydrocarbons. I have said before that I think someone will crack this problem sooner or later.

Then today I just ran across this story:

Anything that grows ‘can convert into oil’

Company finds natural solution that turns plants into gasoline

After three years of clandestine development, a Georgia company is now going public with a simple, natural way to convert anything that grows out of the Earth into oil. J.C. Bell, an agricultural researcher and CEO of Bell Bio-Energy, says he’s isolated and modified specific bacteria that will, on a very large scale, naturally change plant material – including the leftovers from food – into hydrocarbons to fuel cars and trucks.

“What we’re doing is taking the trash like corn stalks, corn husks, corn cobs – even grass from the yard that goes to the dump – that’s what we can turn into oil,” Bell told WND. “I’m not going to make asphalt, we’re only going to make the things we need. We’re going to make gasoline for driving, diesel for our big trucks.”

The agricultural researcher made the discovery after standing downwind from his cows at his food-production company, Bell Plantation, in Tifton, Ga.” Cows are like people that eat lots of beans. They’re really, really good at making natural gas,” he said. “It dawned on me that that natural gas was methane.”

Bell says he wondered what digestive process inside a cow enabled it to change food into the hydrocarbon molecules of methane, so he began looking into replicating and speeding up the process.”Through genetic manipulation, we’ve changed the naturally occurring bacteria, so they eat and consume biomass a little more efficiently,” he said. “It works. There’s not even any debate that it works. It really is an all-natural, simple process that cows use on a daily basis.”

Is it for real? Hard to say. The concept is not science fiction. This is not that far removed from what I worked on in graduate school. Cows utilize microbes in their stomachs that break down cellulose into organic acids like acetic, propionic, and butyric acid. It isn’t out of the realm of possibility that the bacteria could be tweaked to produce butane instead of butyric acid.

However, longer chain hydrocarbons are going to be more difficult. It will take more than minor tweaks (IMO) to get rumen microbes to produce something like gasoline or oil. Long chain acids are produced, but in very low concentrations. Even if they got hydrocarbons produced instead of acids, the hydrocarbons in the gasoline range would be of very low concentration. I also find it a bit odd that “it dawned on him that natural gas was methane.” That’s not really a comment I expect to hear from someone on the cutting edge of biofuel research.

The article mentions a patent – presumably pending – but I have spent half an hour searching for it at the USPTO site without any luck. If anyone runs across it, let me know. That will give me a better idea of whether this is more like TDP – in that very big promises were made that never materialized – or whether there is actually something to this.

Originally posted a year ago today (9/14/06), this one is due for a bump since RVP transition is once again upon us. This is going to make product inventory forecasts a bit tricky over the next month or two as high RVP gasoline is purged from the system.

—————————-

Now, for something that I think will be non-controversial, and hopefully somewhat educational.

Every year in late summer, you will start hearing references in the media about the conversion to winter gasoline, such as the following (originally in the Bradenton Herald, but the link is long dead):

Motorists can thank a mild hurricane season in the Atlantic for the lower gas prices, according to the American Automobile Association.

Other factors include the end of the summer driving season and a cheaper winter fuel mix.

Gas stations sell a special, more expensive fuel blend during the summer to cut down on smog during hot months. Stations nationwide will start selling a less-expensive winter fuel blend Friday, which could lead to even lower prices, analysts said.

So what does this mean, and why does it make winter gasoline less expensive?

A Primer on Gasoline Blending

Gasoline is composed of many different hydrocarbons. Crude oil enters a refinery, and is processed through various units before being blended into gasoline. A refinery may have a fluid catalytic cracker (FCC), an alkylate unit, and a reformer, each of which produces gasoline blending components. Alkylate gasoline, for example, is valuable because it has a very high octane, and can be used to produce high-octane (and higher value) blends. Light straight run gasoline is the least processed stream. It is cheap to produce, but it has a low octane. The person specifying the gasoline blends has to mix all of the components together to meet the product specifications.

There are two very important (although not the only) specifications that need to be met for each gasoline blend. The gasoline needs to have the proper octane, and it needs to have the proper Reid vapor pressure, or RVP. While the octane of a particular grade is constant throughout the year, the RVP spec changes as cooler weather sets in.

The RVP is the vapor pressure of the gasoline blend when the temperature is 100 degrees F. Normal atmospheric pressure varies, but is usually around 14.7 lbs per square inch (psi). Atmospheric pressure is caused by the weight of the air over our heads. If a liquid has a vapor pressure of greater than local atmospheric pressure, that liquid boils. For example, when you heat a pot of water, the vapor pressure increases until it reaches atmospheric pressure. At that point, the water begins to boil.

In the summer, when temperatures can exceed 100 degrees F in many locations, it is important that the RVP of gasoline is well below 14.7. Otherwise, it can pressure up your gas tanks and gas cans, and it can boil in open containers. Gas that is boiled off ends up in the atmosphere, and contributes to air pollution. Therefore, the EPA has declared that summer gasoline blends may not exceed 7.8 psi in some locations, and 9.0 psi in others.

A typical summer gasoline blend might consist of 40% FCC gas, 25% straight run gas, 15% alkylate, 18% reformate, and 2% butane. The RVP of the gasoline blend depends on how much of each component is in the blend, and what the RVP is of each component. Butane is a relatively inexpensive ingredient in gasoline, but it has the highest vapor pressure at around 52 psi.

In a gasoline blend, each component contributes a fraction to the overall RVP. In the case of butane, if there is 10% butane in the blend, it will contribute around 5.2 psi (10% of 52 psi) to the overall blend. (In reality, it is slightly more complicated than this, because some components interact with each other which can affect the expected RVP). This means that in the summer, the butane fraction must be very low in the gasoline, or the overall RVP of the blend will be too high. That is the primary difference between winter and summer gasoline blends.

Why Prices Fall in the Fall

Winter gasoline blends are phased in as the weather gets cooler. September 15th is the date of the first increase in RVP, and in some areas the allowed RVP eventually increases to 15 psi. This has two implications for gasoline prices every fall. First, as noted, butane is a cheaper blending component than most of the other ingredients. That makes fall and winter gasoline cheaper to produce. But butane is also abundant, so that means that gasoline supplies effectively increase as the RVP requirement increases. Not only that, but this all takes place after summer driving season, when demand typically falls off.

These factors normally combine each year to reduce gasoline prices in the fall (even in non-election years). The RVP is stepped back down to summer levels starting in the spring, and this usually causes prices to increase. But lest you think of buying cheap winter gasoline and storing it until spring or summer, remember that it will pressure up as the weather heats up, and the contained butane will start to vaporize out of the mix.

And that’s why gasoline prices generally fall back in the fall, and spring forward in the spring.

It’s the end of a very long day, but I couldn’t resist commenting on the recent story from Joule Biotechnologies:

Joule Biotechnologies Introduces Revolutionary Process for Producing Renewable Transportation Fuels

CAMBRIDGE, Mass.–(BUSINESS WIRE)–Joule Biotechnologies, Inc., an innovative bioengineering startup developing game-changing alternative energy solutions, today unveiled its breakthrough Helioculture™ technology—a revolutionary process that harnesses sunlight to directly convert carbon dioxide (CO2) into SolarFuel™ liquid energy. This eco-friendly, direct-to-fuel conversion requires no agricultural land or fresh water, and leverages a highly scalable system capable of producing more than 20,000 gallons of renewable ethanol or hydrocarbons per acre annually—far eclipsing productivity levels of current alternatives while rivaling the costs of fossil fuels.

Joule SolarFuel liquid energy meets today’s vehicle fuel specifications and infrastructure, and is expected to achieve widespread production at the energy equivalent of less than $50 per barrel. The company’s first product offering, SolarEthanol™ fuel, will be ready for commercial-scale development in 2010. Joule has also demonstrated proof of concept for producing hydrocarbon fuel and expects process demonstration by 2011.

The press release is a couple of weeks old now, and I ignored it at first. It almost reads like satire. Maybe it is? But I have seen it picked up now and reported at face value by some sites. So I thought I would weigh in.

Seriously, since we starting running cars on oil 100 years ago, how many disruptive technologies have there actually been in this area? None. There have been improvements, but we are still running most of our cars on oil. A disruptive technology would be something that resulted either in us running most of our cars on something other than oil, or something that caused us to abandon our cars for something else.

Cold fusion-powered hovercraft? Now that would be disruptive. A battery with a 200-mile range for a full-sized car? Also disruptive. When we start to run short of oil? Disruptive in a different way. But the press release above? I have seen a thousand others just like it. Eventually maybe one of these disruptive pretenders will pan out. But if I was a betting man…

Tom Whipple elaborated on this story today (which is what prompted me to go ahead and write this up):

The Peak Oil Crisis: More Disruptive Technology?

Yet another potentially disruptive technology has been announced. This time a small company, Joule Biotechnologies, up in Cambridge MA says it has developed a process to produce hydrocarbon based fuels from carbon dioxide and water. As with any too-good-to-be-true announcement skeptics abound – just on general principles.

The process is centered on a “photobioreactor” (think a solar panel with liquid inside) which contains brackish water and a still secret microorganism that has been genetically engineered to absorb carbon dioxide and excrete hydrocarbons when subjected to sunlight.

Somebody with a mathematical bent calculated that if an area the size of the Texas panhandle were covered with photobioreactors, they could produce enough fuel each year that we could say goodbye to oil – drilling, depletion, OPEC, refineries, some forms of pollution, and all the rest. This is sounding much too good to be true for the company estimates the fuel could be produced for $50 a barrel.

The next step, of course, is to get this out of the laboratory and into a pilot plant so we can all see if turning CO2 and water with the help of some sunlight into fuel can really work. A pilot scale plant is planned for the southwest (where they have lots of sunlight) early next year which would be followed by a large scale demonstration plant in 2011.

These people haven’t even built a pilot plant, yet they are talking about widespread production at $50/bbl. Please. Just once I would like to see one of these far-fetched press releases end with “Product is currently for sale for $50/bbl.” If you notice, this is always what is expected. It just never materializes.

Some people think I am anti-ethanol. That is an oversimplification, and a misrepresentation of my position. I have nothing against ethanol as a fuel. It isn’t as good a fuel as butanol, but then again we can’t make butanol as efficiently as we make ethanol.

My objection is that I think the way we make ethanol in the U.S. is a big mistake, and we will recognize this eventually. It may happen following a drought in the Midwest that causes corn crops to fail. That may be what it takes before we recognize that recycling natural gas into ethanol via food was a terribly bad and short-sighted idea.

I also dislike the incredible hype associated with cellulosic ethanol. Promising too much lulls the public into thinking we have a solution ready to go in case of an energy crisis. Not so. But underneath that hype is a lot of potential. I don’t think cellulosic success will come from an expensive hydrolysis/biological process. This is simply too inefficient, and requires very high fossil fuel inputs. Rather, I think success will come from a thermochemical process.

Lately, I have spent an awful lot of time studying this:

On paper it is deceptively simply to turn that cellulose biopolymer chain into hydrocarbons or alcohols. In practice it is a different matter. If you know your organic chemistry, you can see sites that should be amenable to chemical attack. I have sketched out pathways that seem like they should work, but you never know until you take them into the lab and try them.

One of the things we do in oil refineries is to crack very complex molecules like this. So, for a long time I have wondered about the implications of using various refining processes on cellulose. For instance, can it be cracked in a hydrocracker? How about a catalytic cracker? How would cellulose behave it co-fed into a coker? (There are obvious mass transfer constraints that would have to be addressed).

Imagine my surprise today when I was trying to determine if anyone has ever done this, and I ran across this:

Khosla Ventures and BIOeCON form KiOR to commercialize cellulosic ethanol

A technology called the “Biomass Catalytic Cracking Process” could be the key to breaking material like wood, grass and corn husks down for ethanol production.

Catalytic cracking is a process already used in today’s petroleum refineries. Simply put, chemicals are used to break down complex organic molecules. The trick is making the reactions between specific chemicals and molecules efficient and controllable, in order to come up with a desirable product like cellulosic ethanol.

The biofuels industry is highly interested in that type of ethanol, but the process of “cracking” the molecular structures of woody plants, whether with chemicals, heat or other methods, has not yet become cost-effective. KiOR is Khosla Ventures’ and BIOeCON’s bet on commercializing a process.

Khosla Ventures provided the new company’s seed funding, but the amount was not disclosed. BIOeCON’s investment is its intellectual property, which includes the catalytic cracking process.

Doh! Looks like I am not the only one who has been thinking hard about this. Clearly I need to stop letting these ideas percolate indefinitely in my head, and write up a business plan and get to work testing them.

I will be the first to admit that Khosla and I haven’t always seen eye to eye. But I think his most recent ventures – from Range Fuels to his investments into LS9 to this latest venture – have a much greater chance of success than some of his earlier ethanol investments. Note that none of these processes require an energy intensive, wet-distillation, which has been one of my biggest complaints about ethanol production. I still say that he is overpromising on the potential, but I think he is now heading into more promising waters.

The following is a slightly modified version of an essay that I posted to The Oil Drum .

Introduction

I have stated on several occasions that I believe global warming is a greater immediate threat than Peak Oil. As long as the demand is there, energy companies will strive to supply fuel to the marketplace. To meet the demand, we will develop tar sands, while consuming enormous quantities of natural gas. We will turn natural gas (or even coal) indirectly (and inefficiently) into ethanol. Finally, we will turn vast quantities of carbon into fuel via what I term “XTL” technologies. XTL technologies consist of a partial oxidation (POX) reaction followed by the Fischer-Tropsch (FT) reaction. When the POX feedstock is natural gas, this is referred to as a gas-to-liquids (GTL) process. If the feedstock is coal or biomass, this is referred to as CTL, or BTL respectively.

I won’t go into a detailed explanation of the POX and FT reactions. What I will give is a quick, layman’s overview. When a hydrocarbon material is burned (e.g. natural gas, coal, biomass, etc.), it can be completely oxidized (combusted) to carbon dioxide and water, or it can be partially oxidized to carbon monoxide and hydrogen. The latter POX reaction is accomplished by restricting the amount of oxygen during the combustion, and it is a potentially deadly reaction should it inadvertently occur inside your home. The resulting mixture of carbon monoxide and hydrogen is called synthesis gas (syngas) and can be used in the manufacture of an abundance of organic compounds.

The FT reaction is a bit more complex than the POX reaction. You can find in-depth information on the FT reaction here. In short, the FT reaction converts syngas generated via the POX reaction into a distribution of long-chain hydrocarbons. Hydrocarbons in the diesel fuel range are very common, making this reaction an ideal way to extend the fossil fuel economy.

The Promise

At present, the economics for GTL are far more favorable than for CTL or BTL. There are enormous reserves of natural gas throughout the world. Worldwide reserves of natural gas are estimated to be 6,200 trillion cubic feet, of which 3,000 trillion cubic feet are estimated to be stranded. (Reserves are considered to be stranded if it is uneconomical or impractical to get them to market.) This is enough stranded natural gas to produce 300 billion barrels of fuel, according to Syntroleum (Warning: It’s a 3.4 meg PDF).

GTL is not a pipe dream. The process is technically viable, having been demonstrated on numerous occasions. It is economically viable depending on the price spread between natural gas and oil. Despite the fact that the capital costs for GTL plants are approximately twice those of conventional oil refineries, a number of projects have been announced in Qatar. Plants are being built, and the fuel produced will help supply some of the shortfall that Peak Oil will generate.

The Peril

Of course there is a catch. GTL is not all that efficient. There are efficiency losses during both the POX and the FT processes. It would be far more efficient to run automobiles directly on the natural gas. Due to the fact that the gas is stranded, this is obviously not an option. But the efficiency losses are significant. According to the Syntroleum link, it takes 10,000 cubic feet of gas to make 1 barrel of fuel. 10,000 cubic feet of natural gas contain roughly 10 million BTUs, but a barrel of fuel contains only around 5.5-6 million BTUs. Forty percent of the BTUs are either lost as radiant heat, or turned to steam and consumed in the GTL plant. Unless carbon sequestration is in place (unlikely), all of those BTUs ended up as carbon dioxide in the atmosphere. On top of that, the BTUs from the barrel of fuel are going to end up as carbon dioxide in the atmosphere once the fuel is burned in an engine.

The reason I find this more worrisome than Peak Oil is that I believe this path is inevitable, yet the consequences are unpredictable. We will make and use GTL fuel, as inefficient as it may be. Our carbon dioxide emissions are likely to accelerate in our quest to maintain affordable energy. As stranded gas supplies are consumed and GTL production peaks, there is CTL, with the same efficiency problems, waiting in the wings. From my view, the fossil fuel economy will be with us for a long time to come.

Look at the figure below, and think of the experiment we are conducting. Atmospheric carbon dioxide levels are at their highest levels in human history. The trend in the graph shows a linear increase in atmospheric levels. The trend didn’t deviate at all during the oil shocks of the 70’s.

Source: National Oceanic & Atmospheric Administration

I believe I can see the foresee the consequences of Peak Oil. It certainly won’t be a picnic. But I think I can plan for it, and I believe that we will eventually adjust to a post-oil world. But I can’t foresee the consequences of warming the earth up by 5 or 10 degrees C. Humanity has never had to deal with this problem. The Sahara Desert was once lush with vegetation and teemed with wildlife. Consider the impact if this is the fate of the Corn Belt of the Midwest. Yet I see nothing to indicate that we are going to veer from the course we have set.

I almost never talk about distillates, which are hydrocarbons that are heavier than gasoline and are used to make diesel and heating oil. I don’t use heating oil or diesel, so I don’t think about this market too much, but I know that a lot of people do. And for those who do, it’s shaping up to be at a minimum an expensive winter. I had seen this story earlier in the week:

Heating oil prices soar, elderly panic

A warm, summer-like day did nothing to ease the fears of the elderly women who walked into the Brockton senior center earlier this week seeking fuel assistance.

“They are panicking,” said Anne McCormack, the city’s director of elderly affairs.

And, they have reason to panic, say fuel oil dealers who are paying record-high prices and therefore charging record-high prices even before the winter cold sets in. The problem is even worse for those who rely on government fuel assistance programs, administrators say.

“Never in my lifetime,” veteran oil dealer Charlie Dyer of Raynham said about today’s prices. “It’s going to be a very difficult winter for customers, no doubt about it.”

And consumers will get no relief, as today the EIA announced a very large surprise drop in distillate inventories:

Oil rebounds to go above $80

In its weekly inventory report, the Energy Information Administration (EIA) said crude stocks gained by 1.2 million barrels last week. Analysts were looking for a decline of 400,000 barrels according to Dow Jones.

Gas inventories eased by 100,000 barrels, compared to the 400,000 gain predicted by analysts. Distillates, used to make heating oil and diesel fuel, fell by 1.2 million barrels. Analysts were looking for an increase of 700,000 barrels in distillate supplies.

In the inventory report, EIA said refineries operated at 87.5 percent capacity, falling just shy of expectations.

Some analysts predict crude is set to drop $10 to $15 a barrel over the next couple of months as the fundamentals aren’t there to support $80 oil. Others say $100 a barrel is just around the corner, especially in the event of a surprise disruption in supplies.

So, here’s the score heading into the 4th quarter: Gasoline inventories remain at record-low levels. Distillate inventories, at 134 million barrels, are 16 million barrels lower than at this time last year (but not terribly low by historical standards). But distillate prices are $0.65/gallon higher than they were a year ago, meaning fuel oil bills are going to be much higher than normal. Crude oil inventories have fallen over the past couple of months, but are still historically high. I think the big story remains gasoline, and whether we can dig our way out of this hole over the fall and winter. If not, something’s got to give next spring.

As I have said before, an ideal biofuel would be one that phases out of water, and is therefore much less energy intensive to separate. One of the big energy sinks in ethanol production involves an energy intensive separation of ethanol from water. If ethanol was insoluble it would phase out of solution and could be skimmed off and separated for a fraction of the energy input.

This is the sort of model that companies like LS9 and Virent have adopted. They are using microorganisms to produce longer-chain hydrocarbons that not only are much easier to separate from water, but also have higher energy density. I have commented in the past that this is ‘Holy Grail’ stuff, but also would be technically challenging. But I think companies pursuing this line of research have a real shot at being ultimately successful.

Add Amyris to the list of companies competing for the Holy Grail. They also have a twist to their business plan that should give them an advantage over their competitors. Amyris has been mentioned on this blog a couple of times previously, but not in the same kind of detail as LS9. This post will rectify that by highlighting what they are doing.

First, what are they doing? In their own words:

Amyris technology makes it possible to alter the metabolic pathways of microorganisms such as yeasts, creating living factories that produce molecules with practical applications. While reading, writing, and analyzing the DNA of microbes once took years, Amyris can now reprogram microorganisms and test our ability to produce desired molecules in days to weeks. Our proprietary technology transforms plant-based feedstocks, such as sugarcane, into 50,000 different isoprenoids –molecules used in a wide variety of energy, pharmaceutical, and chemical applications.

So you have heard similar claims before. However, they are quite a bit farther along than many would-be biofuel companies. They just announced the ‘opening’ (I presume that means they aren’t starting up just yet) of their first pilot plant in Emeryville, California:

Amyris Opens Pilot Plant to Produce Renewable Diesel Fuel

California Facility Marks Step in Developing and Commercializing Viable Alternative to Petroleum Fuels

EMERYVILLE, Calif. – November 12, 2008 – Amyris Biotechnologies, Inc. today announced that it has opened its first pilot plant producing No Compromise™ renewable diesel fuel. The pilot plant, which was ompleted in September, is an important milestone for Amyris towards its goal of developing and commercializing its sustainable, hydrocarbon‐based fuel, which it expects to bring to market in 2010.

The plant serves as a technical gateway to commercialization in Brazil and other manufacturing locations. It will demonstrate Amyris’ technology in scaled down process equipment that is representative of full ommercial scale operations; generate essential engineering data for designing Amyris’ full scale plants; and produce product samples for performance testing.

Amyris’ diesel is characterized as a No Compromise™ fuel because it is designed to be a scalable, low‐cost enewable fuel with performance attributes that equal or exceed those of petroleum‐sourced fuels and urrently available biofuels.

Other attributes innclude:

• Superior environmental performance: Preliminary analyses show that Amyris diesel fuel has virtually no sulfur and signifiantly reduced NOx, particulate, carbon monoxide and hydrocarbon exhaust emissions relative to petroleum‐sourced diesel fuel.

• High blending rates: Because Amyris renewable diesel contains many of the properties of petroleum diesel, Amyris can blend the fuel at high levels ‐‐ up to 50 pecent ‐‐ compared with 10‐20 percent for conventional biodiesel and ethanol.

• Compatibility with existing infrastructure: Unlike many commercially available biofuels, Amyris expects to distribute its renewable diesel through the existing fuel distribution and storage infrastructure, thus speeding time to market while minimizing costs.

• Adaptive: Amyris can produce its fuels from a broad range of feedstock including sugar cane and cellulosic biomass. It is starting with Brazilian sugar cane because it provides the most environmentally sound, economical, and scalable source of energy available today.

“This new diesel fuel has all the characteristics to make an important contribution toward solving our global transportation energy and climate crisis,” said John Melo, chief executive officer of Amyris. “The opening of ur pilot plant is a significant business marker for us, taking us one step closer to bringing our diesel fuel to market.”

In parallel with this effort, Amyris will open a larger pilot plant in Campinas, Brazil in the spring of 2009 here it will finalize processes for Brazilian operations; transfer the technology to manufacturing sites in Brazil; and provide ongoing support for optimizing production in Brazil.

Earlier this year, Amyris established Amyris‐Crystalsev Biofuels, a Brazilian venture in partnership with Crystalsev, one of Brazil’s largest ethanol distributors and marketers, to work with Brazilian sugarcane mills and fuel producers to scale up production of Amyris diesel fuel. SantelisaVale, the second‐largest ethanol nd sugar producer in Brazil has committed two million tons of sugar cane crushing capacity for the initial roduction of Amyris diesel, including its flagship Santelisa mill.

Amyris’ proprietary synthetic biology platform enables Amyris scientists to engineer microorganisms such as yeast so that they can transform sugar into 50,000 different molecules used in a wide variety of energy, pharmaceutical, and chemical applications. Amyris is working on the development and commercialization of everal of these molecules to provide a range of renewable products, including diesel fuel, jet fuel and specialty chemicals.

The platform has already proven successful through the development of a strain of yeast to enable the production of a precursor to artemisinin, a key ingredient in anti‐malarial drugs, at significantly lower cost than can be achieved with conventional technologies. This technology was developed as a not‐for‐profit initiative, and has been transferred to sanofi‐aventis.

About Amyris

Amyris is applying a proprietary synthetic biology platform to create No Compromise™ products ‐‐ low cost renewable fuels and chemicals that are intended to be environmentally friendly, compatible with the existing infrastructure, and have performance attributes comparable to petroleum‐based fuels. Amyris has also developed a technology to produce a second supply of an anti‐malarial drug. Founded in 2003, Amyris has raised over $120 million in equity funding to‐date, including investments from Khosla Ventures, Kleiner Perkins Caufield and Byers, TPG Biotech, and DAG Ventures. Amyris has over 200 employees and facilities in meryville, California; Chicago, Illinois; and Campinas, Brazil. More information about Amyris is available at http://www.amyris.com/.

The really interesting aspect of their business model is the Brazil angle. The U.S. currently has an import tariff on Brazilian ethanol. However, that tariff does not cover other biofuels coming from Brazil. By utilizing low-cost Brazilian sugar to make their biofuel, they stand a good chance of meeting their cost projects. Further, by making diesel – which is looking to be in tighter demand than gasoline for years to come – they are getting into a market with much better profit margins than ethanol has.

This, and some other highlights from a Greentech Media story:

Amyris: We’re Better Than Biodiesel, Ethanol or Gas

Amyris, for instance, will be able to produce a form of diesel that it will sell at the wholesale level for $2 a gallon or less, or around the same price as conventional fossil diesel, said CEO John Melo.

“It will be around the same price as regular petrol diesel, but it will produce 80 percent less greenhouse gases, provide a 10 percent reduction in NOx (nitrogen gases) and provide the same or better performance,” Melo said. “And with zero sulfur.”

The company’s jet fuel, which will replace kerosene-based fuels, will produce 90 percent fewer greenhouse gases than the regular stuff without denting performance or mileage, he said.

The big test for Amyris will arrive in about two years. The company has created joint ventures in Brazil to create biorefineries on sugar plantations where genetically engineered yeast will feast on freshly harvested sugar. The resulting fuel will then be loaded onto ships and brought to the U.S. By 2010, Amyris hopes to be producing 200 million gallons a year out of its first plant and erecting more plants.

Melo also pointed out that because Amyris isn’t producing ethanol (an alcohol) in Brazil but a hydrocarbon (a molecule includes hydrogen and carbons), the ethanol tariff on Brazilian ethanol doesn’t apply.

Promising stuff. To me it looks like they have a good chance of being successful.

Footnote: As is the case with LS9 and Virent, there is no Amyris stock that one can buy. It is a privately held venture.

1. Voltages less than 50 volts: a) can cause fatal shock under all condition, b) cannot cause fatal shock under any conditions, c) can cause fatal shock under some conditions.

2. Arc welding machines are typically greater than 50 volts. T__, F__
3. A person who has wet hands or feet is more susceptible to electrocution than a person who is dry. T__, F__
4. Because metal frames in processing plants are intentionally well-grounded, a person in contact with such a frame while using an arc welder or other electrically-powered tools is much more susceptible to electrocution than one who is not. T__, F__
5. Hazards of arc welding include: a) Electrocution, b) Fires, c) Flesh burns to eyes from UV radiation, d) Burns from sparks, e) Metal fumes, f) Heat-related explosives g) Production of toxic gases when used near cleaning operations using chlorinated hydrocarbons.
6. Hazards of oxy fuel welding include: a) Fires, b) Explosion of oxygen, c) Explosion of acetylene, d) Fire and explosions when gases mix in lines, e) Metal fumes, f) Flash burns to eyes, g) Heat-related explosions.
7. An acetylene cylinder should: a) be transported on its side with the cap on, b) be transported upright with the cap on, c) be stored upright for a few hours prior to using if accidentally laid on its side.
8. Using oxygen to blow off clothing: a) is a fire hazard, b) results in an oxygen-enriched atmosphere in the clothing for some time after.
9. An oxy-acetylene torch: a) cuts steel, b) burns steel
10. Using oil or grease on an oxygen regulator: a) is likely to cause the grease to burn, b) is likely to cause the regulator to burn, c) is likely to cause the cylinder to explode and go airborne.
11. The valve on an oxygen cylinder must be opened: a) ¼ turn, b) ½ turn, c) ¾ turn, d) all the way.
12. The valve on an acetylene cylinder must be opened: a) ¼ turn, b) ½ turn, c) ¾ turn, d) all the way, e) never more than what allows the gage pressure to reach 15 psig.
13. Acetylene gas is extremely unstable when compressed. T__, F__.
14. Acetylene cylinders: a) are filled with a porous substance, such as calcium silicate to eliminate pockets of gaseous acetylene of appreciable size, b) have the acetylene dissolved in acetone.
15. Acetone can hold 400 times its own volume of acetylene at a working pressure up to 250 psig. T__, F__.
16. Oxygen and acetylene cylinders must: a) Have the cap when not in use, b) Be secured in the upright position both during storage and use, c) Be protected from being bumped when the regulator is on, d) Be stored at least 20 feet apart or separated by a noncombustible barrier at least five feet high with a fire-resistance rating of at least 1/2 hour.
17. Allowing the pressure in either cylinder in an oxyacetylene welding system to decrease below 20 psig: a) Is unsafe, b) May result in backflow of the gas from the other cylinder creating an explosive mixture.
18. Allowing the sun to heat a cylinder to 500 degrees F, could a) increase the pressure by over 10%, b) increase the pressure by over 50 %, c) increase the pressure by over 100 %.
19. Taking oxy-acetylene welding cylinders into a confined space: a) is unsafe, b) could result in leakage of the gas causing a fire and explosion hazard,
20. Oxygen is: a) explosive b) makes everything in an oxygen-enriched atmosphere more flammable.
21. Regulators are required on oxygen and fuel gas cylinders. T__, F__
22. Before a regulator is attached to a cylinder valve: a) the valve should be “cracked” wide open, b) the valve should be opened slightly and immediately closed.
23. Fuel gas hoses are colored red. T__, F__
24. Oxygen hoses are colored green. T__, F__
25. Chemically inactive gas hoses are black. T__, F__
26. Hose clamps are suitable for splicing hoses used in oxy-acetylene welding applications. T___, F__
27. Matches and butane lighters are suitable for lighting a cutting/welding torch. T__, F__
28. When a welder is changing electrodes, he or she should be on a a) conductive, b) nonconductive surface
29. Electrodes should be removed from holders when the welder is turned off. T__, F__.
30. Polyester clothing should a) never b) usually c) always be worn when welding
31. Polyester is: a) flame resistant, b)burns easily, c) melts on your skin increasing the severity of burns.
32. Welding or cutting areas must be: a) protected from water, b) protected from wind, c) Fire safe
33. You can recognize whether or not fumes from a welding rod are hazardous by: a) looking at the color of the smoke, b) smelling the smoke, c) looking at the Material Safety Data Sheet.
34. Grease and oil must be stored at least a) 5 feet, b) 10 feet, c) 20 feet, d) 40 feet, e) 50 feet from oxygen.
35. Empty fuel gas and oxygen cylinders can be stored together? T__, F__
36. Personal protective equipment for welding or cutting includes: a) eye and face protection, b)skin protection, c) respiratory protection, d) hearing protection.
37. Effective ventilation is a better alternative than respiratory protection in most cases. T__, F__.
38. When personnel leave the confined space, the oxy-acetylene torch and hoses must be removed from the space. T__, F__

    Answers: 1)c, 2)T, 3)T, 4)T, 5)abcdefg, 6)abcdefg, 7) bc, 8)ab, 9)b, 10)abc, 11)d, 12)e, 13)T, 14)ab, 15)T, 16)abcd, 17)ab, 18)c,19)ab, 20)ab, 21)T, 22)b, 23)T, 24)T, 25)T, 26)F, 27)F, 28)b, 29)T, 30)a, 31)bc, 32)abc, 33)c, 34)d, 35)F, 36)abcd, 37)T, 38)T

Table 1. Weld Characteristics/Parameter/Criteria for Three Types of Welding