Presumably Texas-based Shell Oil subsidiary CRI Catalyst Company has run its eye pretty carefully over the plethora of algae-oriented biofuel projects around the world. Investorshub lists over 30 on its website
Earlier this year Shell also announced it was getting out of algae oil production (see here).
So, the recent announcement by Marlborough-based Aquaflow Bionomic Corp. that it has signed a major agreement with CRI has to rate as somewhat of a coup.
Aquaflow uses wild algae to help clean up water, and, once it is broken apart, produce a 'green crude' - the precursor to black crude pumped out of the ground, but without the millions of years of heat and pressure involved in the conversion process.
CRI has a catalyst and process technology to convert this green crude to hydrocarbon fuels and blend stocks - typically in a few hours. It uses what it calls an Integrated Hydropyrolysis and Hydroconversion (IH2) technology which it says cost-effectively converts biomass directly into renewable gasoline, jetfuel and diesel.
Director Nick Gerritsen says unlike most other algae to oil projects, Aquaflow uses the algae that naturally exist in an area, localized for the environment they have developed in, as the clean-up mechanism for the water. Gerritsen is also a great believer in the water-restorative ability from harvesting algae - essentially many bangs for buck from the methodology. The company has been trialing its algae technology in the Blenheim Municipal Wasterwater plant (among a number of projects).
Gerritsen says the vast majority of other companies are focused on the lipid oil yield of algae, which generally means they are selecting species to that end, or breeding genetically modified species for the same.
"They're trying to cultivate mono-cultures or a small number of species," he says. "We believe that all this is both expensive, hard to scale and has significant technical risk."
Under Aquaflow, the company's embracing algae species that change over regions, whose interactions are very sophisticated. "They also have the capacity to deal with a large number of variables to maintain viable populations," says Gerritsen.
"Our approach means intrinsic alignment with localised conditions. In any situation where there is water and nutrients, you get algae, and nature grows if for us for free."
Algae-polluted water is a major global environmental challenge, and in the USA alone is estimated to have cost US$4.3 billion annually says Gerritsen. By removing the algae Aquaflow's process can also help clean up water he says.
The company's also completed a three year chemistry programme and knows what compounds it can produce using its own proprietary catalysis process.
Aquaflow has been actively seeking partners for its process (invitation to do so are made on its website). As a relatively small Kiwi company, collaborating with aligned companies with deeper pockets makes perfect sense.
Gerritsen's use of the term optionalities (according to Wiktionary - The value of additional optional investment opportunities available only after having made an initial investment), is one way Aquaflow is protecting its intellectual property.
He describes the company's Algae Leverage as understanding how to optimize the growth dynamics, harvesting as it happens, nutrients, water and the multi-uses of the end products as key components of what it brings to the table. (Aquaflow also has projects and relationships with UOP Honeywell among others). The end result of the algae production can be from fertiliser to bioenergy feedstocks.
"We can configure our offer to where the market is," Gerritsen says. "Effectively, our toolkit has lots of different sized spanners."
Gerritsen says one project that Aquaflow is looking to partner in, has a potential payback of less than a year, where the 'fuel' is a byproduct of the scheme's overall value.
However, the company gets much further down its stated goal of producing clean water and clean
energy in its relationship with CRI Catalyst - though there's many in the race to achieve the same
CRI is building a small algae-based demonstration in Chicago, and looking to build a much bigger, $100s million, project in the near future. Aquaflow plans to lead on a series of projects already in its pipeline – leveraging its algae capability says Gerritsen.
Unlike a number of companies seeking to plug into waste streams from fossil industrial production – Aquaflow is targeting the fossil fuel source itself.
"We believe that this will maximize value across the entire business transaction – from biomass right through to end use of the renewable fuels," says Gerritsen. "It is exciting to have the opportunity to help lead the charge on this."