BUSINESS

Energy bugs: food goes in, oil comes out

SUSAN MOHAMMAD July 7 2008
BUSINESS

Energy bugs: food goes in, oil comes out

SUSAN MOHAMMAD July 7 2008

Energy bugs: food goes in, oil comes out

BUSINESS

SUSAN MOHAMMAD

In the race to find ways around the global petroleum problem, scientists at a small Silicon Valley biotechnology company have managed to get genetically altered bugs to poop oil. Inside the labs at LS9 Inc., sugar cane and agricultural waste products like wood chips or wheat straw are fed to bugs whose genes have been genetically modified. Like something out of a science fiction novel, the bugs excrete crude oil that is similar to ester-diesel. Theoretically, it could be poured directly into the tank of a car, although researchers say it’ll be late this summer before the microorganisms have produced enough to test on an engine.

Currently, the company’s tiny employees are excreting 100 gallons per week at a cost of roughly $120 per barrel. The goal is to make enough renewable fuel to sell commercially—and to whittle the cost per barrel to $50 by experimenting with locally available feeds, such as grass. “Once you finish with the genetic engineering, you throw these bugs into a fermenter, you feed it renewable sugars and they convert them into a variety of products,” says Stephen del Cardayre, VP of research and development at LS9 Inc. So far, the company has received $20 million in venture funding, which allowed it to develop the technology and expand to a staff of 50 people.

Naturally the process, which LS9 is calling “Oil 2.0,” is being kept secret while patents are pending. The next step is raising more capital to expand production. In a world where conventional oil prices are skyrocketing, even highly experimental ideas are generating a lot of excitement, which works in LS9’s favour. “We have the technology. The next phase is scaling it up. We are moving out of lab scale to a pilot-scale facility with a thousand-litre-capacity tank,” says del Cardayre. “Then early next year, a demonstration plant, which will be five million gallons a year,” he says, adding the company is confident they can go commercial in 2011 to produce 100 million gallons a year. “We started two years ago in my garage and we are a good two years ahead of schedule.” M