"Revolutionary" biofuels company raises $55.8m in funding round
LanzaTech uses a patented fermentation process to convert gases, including those derived from industrial and biomass sources, into fuels, avoiding the “food versus fuel” tensions faced by first-generation biofuels.
A large tranche of the new funding came from Petronas Technology Ventures Sdn Bhd, the venture arm of Malaysian national oil company Petronas, as well as existing investors such as high-profile venture capital firm Khosla Ventures. The company has now raised more than $85m since its establishment in 2005.
“The size of this round and the quality of the new and returning investors is a strong validation of not only our technology, but the unparalleled opportunity for LanzaTech to be a global leader in biofuels and biochemicals markets,” said Dr Jennifer Holmgren, chief executive of LanzaTech, in a statement.
As well as signing a deal with Virgin to pilot the technology, the company is constructing a demonstration plant to convert waste flue gas from a steel manufacturing plant run by Baosteel, China’s largest steel manufacturer. Similar projects are also in the pipeline in India and the US.
In related news, POET, one of the world’s largest ethanol producers, and Dutch biosciences company Royal DSM, have created a $250m joint venture to produce cellulosic ethanol from corn crop residue.
The two partners believe they can produce the fuel in commercial quantities by the second half of 2013.
An initial demonstration of the technology will be delivered at Project Liberty, a major new biofuel plant currently being constructed adjacent to POET’s existing corn ethanol plant in Emmetsburg, Iowa. The initial capacity is expected to be 20 million gallons in the first year, growing to about 25 million gallons per year.
Together, POET-DSM Advanced Biofuels intends to replicate and license the technology to plants to be built at POET’s other 26 corn ethanol facilities, as well as plants run by other domestic and international producers.
In light of the joint venture, POET said it does not now intend to take up the $105m loan guarantee awarded by the US government in September.
The market for ethanol is set to increase rapidly, with the Environmental Protection Agency estimating the US will need 350 to 400 new bio-refineries by 2022 to meet new renewable fuel standards.