ExxonMobil and Synthetic Genomics Inc. (SGI, a biotechnology company) have announced a research partnership with the aim of developing biofuels from algae.

In a statement from SGI, the company founder J Craig Venter described the long-term objective of the alliance to explore “the most efficient and cost effective ways to produce next generation biofuels using photosynthetic algae”. These biofuels would be economically viable, and compatible with gasoline and diesel fuels currently in use.

This interest in algal biofuels from the oil and gas company comes in response to a number of potential benefits, and represents a significant investment. Growing algae consume carbon dioxide, and as such could serve as a carbon sink and assist the reduction of net emissions from the fuel industry. A shift to algal biofuels could also negate potential land use conflict between food and fuel crops, as algae can be cultured using land and water unsuitable for agriculture.

The deal is potentially worth $300 million for the La Jolla based genomics company, if they meet a number of research and development milestones, while a further $300 million is invested into ExxonMobil Research and Engineering Company (EMRE).

SGI will focus on finding and enhancing strains of algae to efficiently yield lipids and long-chain hydrocarbons, while EMRE will work with the bio-oils produced to develop finished biofuel products. Together, the companies aim to identify and develop large-scale production systems suited to producing algal biofuels on an industrial scale.

SGI speculate that algae could yield more fuel than crop plant sources currently in use; as much as 2,000 gallons of fuel per acre per year, whereas corn yields approximately 250.

Emil Jacobs, vice president of research at EMRE, states that “meeting the world’s growing energy demands will require a multitude of technologies and energy sources”.  That a company such as ExxonMobil is willing to invest in algae as a  prospective source of biofuel represents a promising shift in focus.