Ready to enter commercial phase says Algae.Tec CEO on recent news
Algae.Tec Ltd. has made several important announcements over the past month. On Jan. 11 the company announced plans to nearly quadruple capacity at its algae development and manufacturing facility in Atlanta. A week later on Jan. 18, Algae.Tec announced it had signed a binding Memorandum of Understanding with Shandong Kerui Group Holding Ltd. to form a 50/50 joint venture in China for a commercial-scale algae production project. In addition, the company also announced a $5 million capital raising event with Patersons Securities Ltd.
According to Algae.Tec CEO Peter Hatfull, the cumulative impact of these announcements means that his company is making the transition from a development-stage company to a commercial entity. “We’ve reached a completely new level,” he told Biodiesel Magazine. “We are getting external validation of our technology and building commercial plants. It means that within two to two-and-a-half years we will have significant revenue coming in, and that, of course, is the basis for share price increases,” he said. “This is a game changer for Algae.Tec.”
Hatfull specifies that the $5 million being raised through Patersons Securities will be used for two purposes. First, it will be used to fulfill obligations Algae.Tec has made under partnerships with Lufthansa and the Sri Lanka subsidiary of Holcim. While the demonstration-scale project under development at the Holcim cement plant will eventually scale-up to commercial levels, it will initially feature a demonstration operation utilizing five of Algae.Tec’s algae production modules.
The capital will also be used to upgrade the Atlanta manufacturing center. “We will improve both our research and development [operations] there, and our production manufacturing capacity,” Hatfull said. Larger production capacity will be needed to fulfill the needs of the Chinese joint venture, which will require 250 algae production modules.
The joint venture project in China is expected to be fully operational within 12 to 18 months, Hatfull said. While the Atlanta facility will manufacture algae production modules for the project, Hatfull also noted that the actual cost of the China project will be subject to a separate capital raising event. He estimates that his company will need to raise approximately $20 million to finance its half of the project. According to Hatfull, he sees an enormous potential in the Chinese marketplace for algae biofuel technologies, and fully expects Algae.Tec to license its technology to other Chinese carbon dioxide producers in the future.
1 Responses
Organic Mechanic
2012-02-01
1I think we are on the verge of a revolution in biofuels and materials due to algae. Algae can be made into a variety of biofuels, including biodiesel, ethanol, hydrogen, and biogas. To add to the conversation, here are some pros and cons to algae as fuel: PROS: Algae grows in all directions Single celled, no superstructure required for algae (roots, trunks, leaves) Growth: 140 days for land crops; algae is year round, mature in 1-2 days Algae weathers extreme conditions, is resistant to drought, wind, rain Grow 30-100 x more oil per acre than corn or soybeans No sulfur, non toxic, biodegradable Can mix with existing fuels in existing vehicles Can also produce bioplastics, medicine, nutrition, feed, fertilizer, more Can absorb CO2 and other pollutants from power and cement plants, fossil fuel refining, fermentation based industries, ethanol production, etc CONS: Scale - difficulty replicating lab results into larger volume of production Growing - using open ponds are easily contaminated, PBR's (photobioreactors) can be expensive Processing - challenges to harvesting & extracting oil Carbon Capture - is it really feasible? Can the algae keep up with the output, and what about during the night when algae is not active? Can the waste be reliably transferred into the algae? Are the right growing conditions and enough land there to cultivate the algae? ("to fully use the emissions from a 50 MWe natural gas fired power plant land would require 2200 acres of algae.") Additional nutrients are required, such as N, P, or K, which must be added in precise amounts and typically come from chemicals like ammonia or nitrate and phosphorous. Taking into consideration all of the processing, is there a net capture of CO2? Also, capturing the emissions it is not true sequestration, as it will be burned again as fuel. Differing results from strains, environmental conditions, growing systems If chemicals are used to extract oil or process fuel, exhaust can be toxic Environmental Concerns - in scaled cultivation, especially of GM (genetically modified) algae - what if it seriously disrupts the ecosystem? To learn how to make algae biofuels, check out: Algae to Biodiesel: http://www.organicmechanic.com/algae-to-biodiesel/ Algae to Ethanol: http://www.organicmechanic.com/algae-ethanol/ For a look at the broad range of goods possible from algae and considerations for how to scale them up into entrepreneurial pursuits, check out Algae Business: http://www.organicmechanic.com/algae-business/ Let me know if there are any questions about algae, or equipment to cultivate and use biofuels! Organic Mechanic provides green solutions for electricity, transportation, and agriculture. Best, Chris
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