Wow. Big boys getting involved.

Shell, Biopetroleum to Build Algae Plant to Make Fuel

By Eduard Gismatullin and Marianne Stigset

Dec. 11 (Bloomberg) -- Royal Dutch Shell Plc, Europe's largest oil company, and HR Biopetroleum will build an algae- growing plant in Hawaii to produce vegetable oil for biofuels.

The two companies have set up a joint venture, Cellana, to develop the project and will start by constructing a pilot facility, Shell said today in a statement. The partners say algae will absorb carbon dioxide, a gas blamed for global warming.

Algae ``can double their mass several times a day and produce at least 15 times more oil per hectare than alternatives such as rape, palm soya or jatropha,'' Shell said. It ``can be cultivated in ponds of seawater, minimizing the use of fertile land and fresh water.''

Shell said it may target the European Union market once production comes on stream in two years' time. The 27-nation bloc wants biofuels to make up an average 5.75 percent of transportation fuels by 2010 and 10 percent by 2020. Biofuels account for about 1 percent of EU fuel consumption today, according to Oxford, England-based charity Oxfam.

Algae can be used as a feedstock to make diesel-type fuels, Graeme Sweeney, Shell's executive vice president for future fuels, said. Transport-fuel demand will rise 45 percent from 2006 levels to more than 60 million barrels a day by 2030, with the share of biofuels expanding to 7 percent from 1 percent, according to the company.

Project Expansion

Shell, based in The Hague, plans to expand the 2.5-hectare (269,000 square foot) pilot project to a 1,000-hectare facility after two years and later to a ``full-scale commercial,'' 20,000- hectare plant, Sweeney said on a conference call with reporters. He declined to comment on planned investment.

Biodiesel constitutes 80 percent of EU biofuels, according to research company Frost & Sullivan Inc.

The algae project ``offers the opportunity in due course to meet the volume required in Europe,'' Sweeney said.

The seaweed is expected to produce 60 tons of oil per hectare, a ``conservative figure,'' according to Sweeney. That compares with an average of 4 tons of oil per hectare for jatropha.

Shell intends to produce ``very high grade diesel'' from the oil and is ``looking for routes to reach the higher end of the quality spectrum,'' Sweeney said of the so-called cold filter plugging point. The CFP shows the temperature at which oil freezes, which can be as high as 11 degrees Celsius (52 Fahrenheit) for palm oil.

Seems like I said some time ago, it will be the Oil companies to bring you BD in whatever form proves to be profitable.

 Oh, most definitely. It's no big surprise that this is happening, but it is (IMO) good news. Say what you will of the oil companies, they have deep pockets with which to make this a reality.

Nate I am agreeing with you, not only do the oil comapny's have the deep pockets, but they have the infrastructure, scientist, researchers, etc already in place to make it happen. Not to mention getting the lion's share of government money for DOE and DOD research $$$$$$$$$$$. I see it as a good thing.

 More about Shell getting into algal biodiesel. Link here.

• 20 December 2007

Shell is to become the first major oil company to produce diesel fuel from marine algae.

Algae are a climate-friendly way to make fuel from carbon dioxide. They produce an oil that can readily be converted to diesel, and can be fed CO₂ directly from smokestacks. Unlike biofuels such as corn, they don't use up soil or water that could otherwise be used to grow food, which can pump up food prices.

The US government abandoned research on algal biofuel in the 1990s because of the low cost of crude oil. But as oil and food prices began to rise, small algal fuel producers sprang up.

Shell plans to begin construction on a pilot plant in Hawaii immediately, which it expects will produce 15 times as much oil for a given area as other biofuel crops, thanks to the efficiency of algal photosynthesis.