BREAKTHROUGH GAIN IN ALGAE OIL YIELD PER ACRE CLAIMED

With algae oil production yields indicated to be over 70,000 gallons/acre/year, an advanced method for producing the bio oil is being readied for commercial production. This coincides with new reports that petroleum production is falling behind growing World demand for oil. Based on information provided by Hoyt Isom, chief information officer of SunEco Energy, Chino, California, and the new high yield system has been proven in pilot production since 2007and is being prepared for commercial scale oil production at a facility in Niland, California (Imperial Valley). Production is being ramped up to 14.6 million gal/yr within 9 months…

The initial target is bio crude for refining into diesel fuel which SunEco expects can be sold at something under the current market price for petroleum fuel. It performs equally in diesel engines at 20% to 50% blend with petroleum diesel. Up to 82% reduced PM (exhaust particulate matter) emissions has been demonstrated with no loss in power.

Greg Smith, a spokesman for J.B. Hunt Transportation Systems, Lowell Arkansas, a major intermodal and trucking firm, confirms that Hunt has signed a cooperative agreement with SunEco for supply of algae based diesel fuel due to its cost, performance and emissions advantages. Hunt validated SunEco diesel fuel performance by extensive road testing in diesel trucks.

The initial SunEco facility in the Imperial Valley consists of 372 acres of which 200+ acres are ponds that were used previously for fish farming. Several thousand additional acres have been secured for planned production expansion.

Natural strains of algae are cultivated in ponds with brackish water (similar to seawater). Ambient CO2 is absorbed by the pond water/algae A unique feature of the “deep water” technology is ability to use pond water to a depth of 5 ft or more… Algae crude production is said to be at the rate of 33,000 gal/acre/ft which translates into several times this amount per surface acre when the full water depth capability of the system is exploited. Initially, about 2 ft. of fish waste remains in the ponds but this adds nutrients that will be replenished with all manner of organic animal waste.

SunEco has resolved two main challenges to ”algae to energy” viability First is the growth of exponential amounts of algae rich in oils by utilizing a proprietary hybrid growth system that maximizes deep water growth technology, and second is the cost effective extraction of the oils on a commercial scale of several thousand gallons per minute.

SunEco claims that direct labor content is 3.3 jobs per 1000 acre but this does not include the significant number of construction and component fabrication jobs. Although one SunEco job may relate to something around ten million gallons of bio oil, when taken in context with the quantity of middle distillate including diesel fuel used in the U.S., the potential for thousands of new SunEco production jobs and related economic value retained in the U.S could be large. Not the least of those pleased with the prospect of more domestic bio energy production is the Defense Department for energy security reasons and, of course, areas struggling with U.S. unemployment. Mr. Isom said the firm is particularly excited about the prospect of providing new industry in farming areas suffering population declines. .

Asked what parts of the U.S. are best prospects for SunEco algae crude oil facilities, Mr. Isom said that locations with substantial sources of low quality water, sunshine and animal waste are best. Sources of animal waste are good although he adds that human waste can also be used. A related question has to do with refining of algae crude into fuels. SunEco does not plan to be a refiner. It has built its business model as a supplier of crude algae oil to refiners. Questions about crude oil transport (truck, rail and pipeline) to refiners hinge on volumes.

Taken together, it appears the outlook for domestic sources of bio crude oil for fuel, whether from SunEco or other firms including major oil companies (including ExxonMobil), continues to improve. At the same time, ethanol derived from algae by a low cost system has received large funding for commercialization from the Dow Chemical Company. Between the two firms, nearly $1 billion is being invested in algae oil and ethanol.