How to Invest in Cellulosic Ethanol

Cellulosic ethanol developers such as Verenium Corp. (VRNM), Poet Energy (private) and Dupont’s Danisco Cellulosic Ethanol (DD) have reported some development progress. Poet's management has even considered an initial public offer of their company’s stock. Unfortunately, stock prices in the sector have failed to follow along and Poet remains private.

The problem might be that the science has not yet caught up with the public’s resolve to use renewable fuels. There are several different processes still under development to turn fibrous organic material into biofuel: acid hydrolysis, thermochemical conversion, biochemical conversion, consolidated bioprocessing, and combinations of these three.

So far all these processes are expensive, leaving cellulosic ethanol without much appeal to investors at current crude oil prices. That has not stopped Verenium, which in moving forward with development and just restructured its balance sheet with existing convertible note holders. The restructure can be taken two ways, if you assume existing investors have been given a glimpse into the company’s technology portfolio: existing investors are trying to salvage a losing situation OR existing investors see that success is right around the corner and want to support the company in the final stretch.

Nor have the development challenges intimidated others from jumping into the race. BlueFire Ethanol Fuels (BFRE.OB) is developing processes to turn municipal waste into sugars for fermentation into ethanol. It has ample municipal waste supplies lined up. The trick will be getting some kind of fuel to come out the other end at acceptable costs. The stock still trades much like an option on the technology, which could make it a play for investors with high risk tolerance.

A share of CleanTech Biofuels, Inc. (CLTH.OB) is “another cellulosic ethanol option.” CleanTech has also got its eye on municipal waste, which in its abundance makes sense the processing technology notwithstanding! These days CleanTech is using garbage from Chicago to produce small quantities of biomass feedstock for testing by Colorado-based GeoSynFuels.

Accredited investors might have a chance to take a position in a private cellulosic ethanol developer. There are many including Iogen, Coskata, Range Fuels, Mascama, ZeaChem, and Qteros (formerly SunEthanol).

Yet another chance to get behind the sector: Abengoa BioEnergy, SA based in Spain. The parent’s stock trades as an ADR in the U.S. on the Pink Sheets under the symbol ABGOF.PK or under the symbol ABG on the Madrid exchange. Technologically, Abengoa may be further ahead of U.S. cellulosic ethanol producers and the European market from an economic standpoint since Europeans may be more disposed to the switch to biofuel from fossil fuels.

If you do not want to invest directly in the producers because of feedstock or transport risk, consider an equipment supplier. SunOpta’s (STKL) Bioprocess Group provides equipment and process solutions for the biomass conversion industry and claims “the only continuous, industrially proven process in the world that can pre-treat biomass at the temperatures and pressures required for subsequent enzymatic hydrolysis for the production of fermentable sugars.” The forward PE for STLK is 15.2 times and trade volumes are strong.

Disclosure: Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.

Comments

[Ferdinand E...:]

Garbage from Chicago to produce biomass feedstocks. Remembering those wonderful days when a macho man named _______ strolled the alleys in the vicinity of my home at night with a leveled pistol in his hand, makes me think that somebody has the right idea. By the way, there are some objections in circulation about all sorts of ethanol, but for what it is worth, I don't share them. Ethanol isn't the solution, but it's part of the solution.

Sep 02 09:48 AM

[john s. gordon:]

ethanol from cellulose has been of interest since 1974 but progress on getting an industry started has been slow,
> jack

Sep 02 10:07 AM

[rrtzmd:]

...a website for those interested:

www.thecesite.com/inde...

...the companies that pop up there tend to share certain characteristics -- they're bulletin board traded and they don't make any money...do you really need any further information to make an investment decision?

Sep 02 11:11 AM

[George Marc...:]

Debra:

Flex-fuel engine technology is not limited to ethanol blends (E-85). Flex-fuel engines can also run on methanol blends (M-85). The added cost of flex-fuel technology per vehicle is between $0 (per the Methanol Institute) and $100 (per the Department of Energy). If the US intends to reduce its petroleum dependence with an alcohol fuel blend, the question becomes which alcohol fuel blend can be most quickly deployed across the US at a reasonable cost.

I recently attended a seminar at the University of Illinois which involved a discussion of alternative biofuels, primarily corn-derived ethanol and cellulosic ethanol. The conclusion, which I drew after listening to several distinguished experts on the panel, was that cellulosic ethanol was not ready for "prime time" and may never be cost-competitive with petroleum fuels without massive government subsidies.

Methanol, on the other hand, is currently cost-competitive with gasoline. On a BTU basis, methanol and gasoline prices are equal. Methanol is commercially produced today, using existing technology, from natural gas (a resource which the US has in abundance). No technological breakthroughs are required. Methanol can also be produced from cellulosic biomass ("cellulosic methanol" or what used to be called "wood alcohol"). Methanol can be produced from municipal solid waste, coal and from landfill gas. In other words, unlike cellulosic ethanol, the domestic feedstock choices for methanol production are not limited only to "cellulose" but include a host of other plentiful resources as well.

In my opinion, methanol can be for the US what ethanol has been for Brazil: a means to achieve a significant reduction in imported petroleum usage while simultaneously developing an indigenous alcohol fuel industry. As discussed above, flex-fuel vehicle technology allows for a seamless transition from gasoline to M-85 at little or no cost to the consumer either for the advanced engine technology or for the fuel itself.

Finally, Brazil is not satisfied with having flex-fuel engines that only run on ethanol and/or gasoline. Brazil is taking the next logical step with "tetrafuel" engines, manufactured by Fiat/Chrysler. The Fiat Siena, using flex-fuel techology, is capable of running on four different fuels: alcohol blends, straight alcohol, gasoline or natural gas.

We could learn a thing or two from Brazil, not by slavishly copying its ethanol program, but by learning from its leadership that the right alcohol fuel (coupled with flex-fuel technology) is a winning combination if reduction in petroleum dependence is actually a national goal.

Sep 02 11:21 AM

[twotraps:]

Great ideas but not much money to be made yet. Switchgrass is another thing to do, evidently much more potent that corn for ethanol but there is no market for it, therefore no growers. Funny, no problem giving AIG counterparties 180B...GM another 40B.....then the complaining starts over 5B in cash for clunkers and no press at all on fuels. Lovely. The banks may or may not be solvent, hard to tell these days and we are nowhere on fuel. Too many people would be put out if that much cash went to push a program that alter the crude consomption in this country.

Sep 02 11:41 AM

[Delojozafado:]

This is a very decent article. One of interest that was not mentioned was Dyadic DYAI.PK. They seem to have of late established some superior relative shere price strength to VRNM. DYAI is a smaller cap ~$13MM vs the capitalization of VRNM near~ $65MM in capitalization. The Verenium management is mostly an arrogant rapacious predatory group. After adjourning yesterday's annual meeting they have yet to release any memos or information on what was discussed or how the vote went on a couple management sponsored resolutions that will potentially create shareholder dilution. There was a vote on a reverse stock split that would go 1:10 or 1:20. This would allow the company to issue further subsequent debt issuances with out breaking the long term $1 share price to remain listed and not be kicked over to the pinks & then the bulletin board. This would have been OK as the company's operating revenue does not meet current operating expenditures. Except for the second proposal that was a more egregious rapacious plundering of the shareholder equity and current cash flow/burn. This was a stock option swap scam. There would be no need for a stock option swap of worthless options for new option instruments that will further dilute shareholders if the directors and management had succeeded in maintaining and enhancing the share price. Mr Rivas the CEO already receives more than $700K in annual compensation. Most senior members of the board are in the +$400K range of compensation. They did not see fit to exempt themselves from eligibility for this theft of shareholder equity. This is the same scam as the Merrill Lynch/BOA bonus fiasco! in this case rather than TARP money, the VRNM board is anticipating the Gov't windfalls of a Gov't guaranteed loan/ loan /or grant under the DOE alternative energy sponsorship program. This again might have been not so bad if VRNM had enough operating income to meet or even nearly meet current expenses. It is one thing to give such incentives to some of the more than 300 rank and file employees but to perpetrate this kind of theft from shareholders to benefit senior management is unconscionable. It is plainly theft of shareholder equity at best. At worst it is likely if it passed and they still more than a day later won't reveal that, likely to trigger a class action shareholder law suit that is going to create even more negative cash flow to the operating cash burn of VRNM.

Be careful of this one. It has legs against the Gov't funding/assistance forthcoming but the traders and insiders are likely to leave you high and dry if you think you can make a total position, an all in all out Long term holding.

A couple larger caps also of note here are the Dutch conglomerate RDSMY.PK and ADM or more specifically the ADM-A mand cnvt of 5/11 with it's 8.25% yield. While ADM has it's 20% of its business model in mostly corn based ethanol, they have put expansion mansion designs into their newer facilities to accommodate a morphing into the accommodating of larger quantities of biomass for a transition over to a cellulosic process, most likely under a license from a VRNM,DYAI,BFRE etc There is a very excellent website "thecesite.com" that has about 80 different companies listed to explore this whole cellulosic ethanol theme.

Sep 02 12:04 PM

[William Dittl:]

Trading volumes for STKL strong? Actually, volume averages 300,000 shares or lower on a long-term average; making it one of the lowest volume stocks around for a whose peers include HAIN, WFMI and UNFI.

Regarding the BioProcess subsidiary, SBI is more than an equipment supplier. While they provided the proprietary technology for some of the world's first cellulosic ethanol plants (on a pilot and demonstration-scale), they are also working on a commercial project in Minnesota that has state funding for the feasibility studies (CMECP)

Perhaps more interesting is that SBI designed the entire DOE-funded pilot plant for Abengoa that is located in York, Nebraska. The facility received $17.7 million in US taxpayer money. They key behind SunOpta's patented and proprietary process is the efficient job of SEA pretreatment (steam explosion autohydrolysis) that is a direct part of the DOE's sugar platform process. Non-chemical pretreatment is the ideal baseline process for advanced microbial applications including SSF (simultaneous saccharification and fermentation) as well as downstream processing of value-added materials such as bioplastics, chemical building blocks and food/pharaceutical-grade products. The entire division is valued at around $200 million and the lead investor in BlackRock who bought 10% of the division in June of 2007. When SBI moves into commercial production, the value of SBI is going to worth a lot more because the products based on the sugar platform process will be replacing petroleum products that are becoming more costly as oil prices continue to rise. There is also the value of royalties on a commercial basis for both liquid fuels and other value-added streams.

Sep 02 12:09 PM

[William Dittl:]

Also, of the technologies listed here (via their respective companies) the concept behind fermenting sugars is usually associated with plant biomass. Garbage is not a suitable feedstock from an economic standpoint because the feedstock is not predictable; nor is it all cellulose. Generally speaking, using chemicals like VRNM's dilute acid (although VRNM also uses STKL's pretreatment), harsher solvents such as BFRE or using ammonia as is likely the case with DuPont/Danisco presents a lot of problems. Fermentation inhibitors, wastewater and a whole slew of concerns regarding the upkeep of biorefinery equipment all leads back to pretreatment without chemicals. From an economic standpoint, SEA processing has both acid and ammonia pretreatments beat and The University of Toronto put out some very nice waterfall charts showing the process economics of such operations. In turn, burning biomass in low temperature pyrolysis is also less economical than using biochemical fermentation because the pyrolysis process involves moving a gas to a liquid.
www.sunopta.com/upload...

Sep 02 02:17 PM

[jerrydd:]

Best way to invest in CE is DON'T!!! It has never been viable and probably never will be.

By far better is FT the biomass into gasoline/diesel and use the waste heat to make electricity.

Syntroleum makes units that will do just that as is done with NG and coal call GTL, CTL and with biomass, BTL.

Only corn, sugar cane is viable ethanol. Corn sells the mash which is a better cattle feed than the raw corn is making the feedstock almost free so little food is lost as most corn feeds cattle, not people.. By recycling heat, other eff practice corn ethanol is far better than CE. If one FT's the corn stalks, cobs too, income is increased more.

Before you invest in anything you better know the science behind it.

Sep 02 05:19 PM

[75 Year Old...:]

For every BB company that eventaully makes it about 10,000 dont,, Of course its better odds the a Lotto ticket but not much !o

Sep 03 12:17 AM

[75 Year Old...:]

BTW they just discoverd a 3 to 6 Billion barrel oil field off the Mexican coast , in International waters , BP says within 5 years it will be on line , that will almost double current supply , it will keep gas under $ 2.50 gallon for the next 15 to 20 years ,, NOT good news for alternative energy companies !

Sep 03 12:21 AM

[Delojozafado:]

"Oopps", a little typo in my previous post. "subsequent 'debt' issuances", should have read "subsequent share issuances/offerings".

Well then it happened with VRNM. As I had pointed out a reverse split of 1:12 was approved at Monday's annual meeting. In addition the "option swap" of worthless options for the highly compensated top level management in this micro cap company, for new options instruments with equity created out of shareholder equity was also approved. VRNM saw their shares fall off more than 7% in after market trading to 55 cents. That is down from the 65 cents they closed near last Friday.

Amazing that the Obama administration's DOE would grant loans/loan guarantees/&/or grants to this company where in a Merrill Lynch/BOA type of scenario TAXPAYERS MONEY will be diverted as BONUSES into the pockets of high level management that have so miserably failed in the management of the company that they now have had to resort to a reverse stock split! Obviously no one in the Obama Administration is paying any attention to these low level small company chiselers.

You have to wonder how many hundreds of these kinds of scams there are going on out there! The Obama Administration is legitimately trying to get the economy going by helping out these outfits who in the end, each provide employment for hundreds of employees. I guess it is like food stamps . If only 10% of the food stamps are used to buy Lobsters & Steaks for someone at 80 cents on the dollar so that the person in that way 'selling" their food stamps can buy cigarettes and beer with the cash, at least 90% of the needy are actually getting the help they desperately need?

Sep 03 03:03 AM

[SRF4REAL:]

Biocentric Energy is "the Walmart of biofuels" and has a scalable model demonstrating profitability. The stuff feeds on carbon dioxide...
and is highly efficient regarding acreage, productivity and water requirements. (reclaimed water is sufficient). Big oil will never let it happen though. ;)

www.nationalalgaeassoc.../

Sep 03 09:07 AM

[SubsidyEye:]

Interesting that somebody would write an article on investing in cellulosic ethanol without even once mentioning the dependency of the industry's very existence on government policies. The oil price is, of course, a factor. But so is the $1.01/gallon producer tax credit for cellulosic ethanol (unlike the VEETC, it is not available for Brazilian ethanol), the 2.5% + $0.54/gallon import tariff on fuel ethanol, and the federal blending mandates, and the subsidies to farmers who convert over to growing feedstock for cellulosic ethanol production. In addition there are numerous state-level schemes supporting biofuels, some specifically targetted at cellulosic ethanol.

Yet at least some of those policies have expiry dates. And while the U.S. Congress has so far shown its willingness to keep extending the subsidies and tariff barriers, can it be counted on doing that indefinitely, especially once (if) the industry starts scaling up? Unlike subsidies for capital investment, the volume-related subsidies on which the ethanol industry relies have to be paid out year after year. With tight budgets, is Congress going to be willing to commit indefinitely to subsidize driving at several tens of billions of dollars a year?

As for Europe, don't be so sure. Europe does not have a large amount of "surplus" ligno-cellulosic biomass to turn into ethanol, and its environmental groups will not accept a big shift from growing crops for food and feed to growing crops for energy. Finally, and perhaps most important, its transport sector is much more dependent on middle distilates (diesel and jet kerosene) than it is on gasoline.

Sep 03 09:20 AM

[jerrydd:]

On Sep 03 12:21 AM 75 Year Old Citizen wrote:

> BTW they just discoverd a 3 to 6 Billion barrel oil field off the
> Mexican coast , in International waters , BP says within 5 years
> it will be on line , that will almost double current supply , it
> will keep gas under $ 2.50 gallon for the next 15 to 20 years ,,
> NOT good news for alternative energy companies !

At a production cost of $70/bbl and really just a drop in the bucket, it's not going to stop oil from going up with a bullet. And it will rise well before 5 yrs. And it's in US waters.

However in 10 yrs of very high oil, fossil fuel prices oil will be replaced by the far cheaper RE, NG sources. RE just needs that time to be put into place.

Sep 03 10:16 AM

[doctjh:]

Whether you believe in peak oil or global warming, producing our own homegrown energy from renewable sources is a must for national security reasons. The ultimate solution will include many technologies such as solar, wind, advanced biofuels, etc..

Energy security - before peak oil comes peak exports. The true price of gasoline is above $10/gal if you factor in defending the Middle East etc.. It is time to move beyond the burdens that oil imports bring and become free.

There are many other significant benefits that can not be denide:

Jobs - renewable energy creates jobs in the USA

It is renewable - oil is not. Peak oil is a reality, the question is when not if. The earth is not made of hydrocarbons.

Carbon abatement - combusting annual crops does not add to the global carbon balance but burning oil does. Is global warming real - lets not find out!

Sep 04 10:56 AM

[Coachtony:]

As a farmer, I can tell you that any cellulose planting, growing and harvesting will not go far because the infrastructure to handle large quantities does not exist. The elevators are not ready for it. The farm equipment manufacturers are not ready for it. If there is a market, farmers will line up to produce the crops necessary to support it.

Sep 07 09:59 AM

[William Dittl:]

Subsidyeye, perhaps it would also be realistic to mention we also currently subsidize petroleum. As for middle distillates, cellulose can create a myriad of advanced fuels; including jet and military fuels. In addition, there is a plethora of feedstocks in the EU with a lot of wood to the north and a lot of stover and grasses to the east. Add in the shipping capacity and port access and there is a lot of consideration here for a global trade. (Obviously that's what is being planned.) I suggest looking at the first modern butanol plant in Soustons, France; built in 1985. To say we subsidize ethanol and neglect to mention we subsidize fossil fuels is rather unbalanced reporting. -Biggestbison

Sep 10 10:43 AM

[Jett:]

Subject: Symbol VRNM




Info - for your consideration Good review info :

prnewschannel.com/abso.../...

finance.yahoo.com/news......

finance.yahoo.com/news......

finance.yahoo.com/news......


Greening thru Bio-Mass--BP and Geranium Corporation (Nasdaq: VRNM) today announced.


(BP) British Petroleum(153) Billion Dollar company & Vercipia plans to break

ground on its first commercial plant in Highlands County, Florida in 2010.

For more information on Vercipia, please visit vercipia.com.

On 32,000acres.

Why Verenium? 1. Pioneer in the process since 1995
2. US Patent for their biofuel process
3. Has already sold millions in licenses
4. Has a demo plant in La.
5. Has already received govnt funding
6. Friendly with Chu from the DOE
7. Partnership with BP
8. Building a new plant in Florida with BP
9. Getting a loan guarantee from the DOE
10. Can apply for millions in new grants
11. Govnt offering money to auto manufacturers to produce cars that use renewable energy.
12. Govnt offering money to service stations to add E85 pumps and sell more renewable fuel
13. Govnt has mandated the increased use of cellulosic biofuels starting next year. 15,600% increase by 2022

That its 50-50 joint venture company will operate under the name Vercipia Biofuels, and plan
BP and Verenium Announce Vercipia Biofuels to Advance the Commercialization of Cellulosic Ethanol 7/31/09


BP and Verenium Corporation (Nasdaq: VRNM) today announced that its

50-50 joint venture company will operate under the name Vercipia

Biofuels, and plan to relocate its corporate headquarters to Florida. Vercipia


continues to focus on the development of one of the nation's first

commercial-scale cellulosic ethanol facilities, located in Highlands County,

Florida. The company is also developing a second commercial-scale

cellulosic ethanol site in the Gulf Coast region.

"I continue to be pleased and enthusiastic with the progress our joint

venture - Vercipia - has made in only a few short months, and I look forward

to a highly productive and successful next two years as we move toward

bringing a first commercial facility into production," said Carlos Riva,

President and Chief Executive Officer at Verenium.


"BP's 'all of the above' approach to meeting America's future energy needs

includes a significant investment in biofuels development, as this project

demonstrates," said Susan Ellerbusch, President of BP Biofuels North

America. "We believe Vercipia will be a key player in the biofuels supply

chain in the coming years."


Since announcing the formation of the joint venture company in February,

Vercipia has applied for and been selected to move forward with due

diligence on a Department of Energy (DOE) Loan Guarantee for the

Highlands project, which is now underway. In addition, the team has

continued to advance development activity in Florida and on a second site

in the Gulf Coast region.



BP is of one of the world's largest energy companies, providing its

customers with fuel for transportation, energy for heat and light, retail

services and petrochemicals products for everyday items. It is the largest

oil and gas producer in the U.S. and one of the largest refiners. BP is also a

leading player in the global biofuels market. Since 2006, BP has announced

investments of more than $1.5 billion in biofuels research, development

and operations. This includes partnerships with other companies to

develop the technologies, feedstocks and processes required to produce

advanced biofuels and $500 million over 10 years in the Energy

Biosciences Institute (EBI), at which biotechnologists are investigating

applications of biotechnology to energy.

Sep 10 08:03 PM

[Joe Duggins:]

We live in a society that has made it easy for us to develop very bad energy consumption habits. We have been spoiled over the last 50 years because of the fact that oil from fossil fuels is a very rich energy source, but the problem is that it is not a renewable energy source and therefore it will run out one day in the near future. We got a little glimpse of what a shortage of oil can do to us as a nation last summer when gasoline prices went over $4.50 a gallon. Now this was just a temporary shortage. Imagine what will happen when we are close to using up the global oil supply. President Obama, has started to earmark millions of dollars towards research on alternative energies . In this article we will take a look at some alternative energies that continue to show promise.

Ethanol is a pretty good alternative energy fuel source and it is already being used in a few foreign countries. Brazil for example, powers most of the vehicles in its country of ethanol fuel and while it is a very green energy since it is made from corn and other farm sugars it can really exhaust the global food supply really fast if we do not have ways to manufacture it on a large scale. There must be another alternative fuel source which is readily available that we really don't depend on as our main food sustenance.

Cellulosic ethanol is one of the most exciting advanced ethanol fuel sources that is being talked about globally and it is one that can potentially solve our future energy crisis. Cellulosic ethanol is an advanced type of biofuel that is made from the different parts of plants and trees that are not edible.cellulosic ethanol is made mainly from Lignocellulose, which makes up almost all of the mass of vegetation and it is mainly made up of three different types of cellulose. Woodchips are an example of material that can be used to make cellulosic ethanol, and it can be found all around us in abundance. When we cut our lawn and trimming trees with chips or byproduct of this, so instead of throwing these woodchips away we can use them in the future to create cellulosic ethanol. Another great benefit of this type of fuel is that it has been proven to reduce greenhouse gas emissions by up to 85% compared to conventional gasoline fuel, and this is something that regular ethanol fuel cannot even come close to matching.

The only drawback to this alternative fuel is that it takes a lot more processing to get it to the end result of becoming an actual fuel source. If our government really get serious about this and pours in billions of dollars into this research they cut down the processing steps which will enable us to make this a readily available global alternative fuel. Let's hope the Obama administration lives up to its promise of funding these alternative fuel sources.
----------------------...
Money without intelligence is like a car without a road.
www.intelligentinvesti...

Sep 15 02:56 PM

[Jett:]

Verenium (VRNM)

250 issued patents and more than 350 patent applications.

“Verenium is the first publicly traded, fully-integrated, next-generation

biofuel company.Enable the production of low-cost, biomass derived sugars

for a number of major industrial applications, including the

commercialization of advanced biofuels. Investors include Syngenta, AWM

Investment and Health Care Ventures. Verenium trades under the VRNM

symbol on NASDAQ.Model: The key elements of our corporate strategy are

to develop integrated solutions for the emerging

cellulosic ethanol industry for use in production facilities that we own and

operate, individually or jointly with partners, as well as those of third-party

licensees. We intend to use our leadership position to develop novel,

high-performance enzymes and to advance our technology and process

development capabilities, together

with BP, at our pilot and demonstration-scale plants in Jennings, Louisiana,

our first planned commercial facility in Highlands County, Florida, to exploit

opportunities in the developing market for the production of cellulosic

ethanol. We have established our business model based upon the belief that

owning and managing

cellulosic ethanol production facilities in conjunction with strategic partners, including BP, will allow us to

create economic value by incorporating our scientific and engineering skills

into the production facilities. Through our joint venture with BP, we may also

license our proprietary technology to extend our commercial reach and

accelerate our market penetration.

Past milestones:

1. Verenium begins commissioning nation’s first-of-its kind cellulosic ethanol

demonstration plant in Jennings,

Louisiana;2. Verenium announces plans to build first commercial cellulosic

ethanol plant in Highlands County, Florida,

with a target capacity of up to 36 million gallons per year (MGY);


3. British Petroleum (BP) and Verenium form 50-50 joint venture (JV) to

develop and commercialize cellulosic

ethanol from nonfood feedstocks in the United States; JV now operates

under the name Vercipia Biofuels

Future milestones:

1. Secure financing for first commercial-scale cellulosic ethanol facility in

County, Florida. Vercipia Biofuels, the 50-50 JV company between BP and

, intends to break ground on one of the nation’s first commercial-scale

cellulosic ethanol facilities in Highlands County, Florida, in 2010. This 36

MGY facility is expected to begin commercial production in 2012. Vercipia

developing additional commercial facilities in the Gulf Coast region and

expects to announce the location of its second plant in the coming year.

2. Leverage R&D capabilities and enhance cellulosic ethanol capabilities;

3. Pursue strategic partnership opportunities for the Specialty Enzyme

Business Unit

Verenium’s process technology has also been licensed to Tokyo-based

Marubeni Corporation and Tsukishima Kikai Co., Ltd. and incorporated into

their 1.4 million liter-per-year cellulosic ethanol plant in Osaka, Japan –

utilizing construction and demolition wood waste as a feedstock.

Verenium quotable quotes:

“Verenium is the first publicly traded, fully-integrated, next-generation

biofuel company, and its range of expertise and resources greatly enhances

its potential for success. Verenium is mastering the entire cellulosic ethanol

production process as the first and only company with the full range of “field-

to-pump” capabilities. This includes: growing energy crops, developing

enzymes, processing biomass into fuel and, ultimately, selling it.

, Verenium’s partnerships, which range from industry giants like BP and

to the U.S. Department of Energy (DOE), make the company uniquely

positioned for success.

Sep 24 02:41 PM