Wellington
Presumably Texas-based Shell Oil subsidiary
CRI CatalystCompany
has run its eye pretty carefully over the plethora of algae-oriented biofuel projectsaround the world. Investorshub lists over 30 on its
Earlier this year Shell also announced it was getting out of algae oil production (see
So, the recent announcement by Marlborough-based AquaflowBionomic Corp . that it has signed a major agreement with CRI has to rate as somewhat of acoup.
Aquaflow uses wild algae to help clean up water, and, once it is broken apart, produce a 'greencrude' - the precursor to black crude pumped out of the ground, but without the millions of years ofheat and pressure involved in the conversion process.
CRI has a catalyst and process technology to convert this green crude to hydrocarbon fuels andblend stocks - typically in a few hours. It uses what it calls an Integrated Hydropyrolysis andHydroconversion (IH2) technology which it says cost-effectively converts biomass directly intorenewable gasoline, jetfuel and diesel.
Director Nick Gerritsen says unlike most other algae to oil projects, Aquaflow uses the algaethat naturally exist in an area, localized for the environment they have developed in, as theclean-up mechanism for the water. Gerritsen is also a great believer in the water-restorativeability from harvesting algae - essentially many bangs for buck from the methodology. The companyhas been trialing its algae technology in the Blenheim Municipal Wasterwater plant (among a numberof 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 modifiedspecies for the same.
"They're trying to cultivate mono-cultures or a small number of species," he says. "We believethat 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, whoseinteractions are very sophisticated. "They also have the capacity to deal with a large number ofvariables to maintain viable populations," says Gerritsen.
"Our approach means intrinsic alignment with localised conditions. In any situation where thereis 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 estimatedto have cost US$4.3 billion annually says Gerritsen. By removing the algae Aquaflow's process canalso help clean up water he says.
The company's also completed a three year chemistry programme and knows what compounds it canproduce using its own proprietary catalysis process.
Aquaflow has been actively seeking partners for its process (invitation to do so are made on itswebsite). As a relatively small Kiwi company, collaborating with aligned companies with deeperpockets makes perfect sense.
Gerritsen's use of the term optionalities (according to Wiktionary - The value of additionaloptional investment opportunities available only after having made an initial investment), is oneway 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 componentsof what it brings to the table. (Aquaflow also has projects and relationships with UOP Honeywellamong others). The end result of the algae production can be from fertiliser to bioenergyfeedstocks.
"We can configure our offer to where the market is," Gerritsen says. "Effectively, our toolkithas lots of different sized spanners."
Gerritsen says one project that Aquaflow is looking to partner in, has a potential payback ofless 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 cleanenergy in its relationship with CRI Catalyst - though there's many in the race to achieve the sameoutcome.
CRI is building a small algae-based demonstration in Chicago, and looking to build amuch bigger, $100s million, project in the near future. Aquaflow plans to lead on a series ofprojects 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 biomassright through to end use of the renewable fuels," says Gerritsen. "It is exciting to have theopportunity to help lead the charge on this."