Peak Oil: Meet $2 a Gallon Algal Biodiesel

We always take such announcements with a grain of salt. But sometime between the year 2020 and 2030, it is likely that algal biofuels will be competitive with synthetic fuels from natural gas and coal.

AFS BioOil announced that initial tests conducted by the company since startup of the system confirm that production costs of biodiesel will be in the range of $2 per gallon when produced in a commercial system of 1 millon gallons/yr and greater.

...AFS BioOil has recently partnered with a renewable electricity company that has the technology to convert waste heat into electricity at a cost of 6 cents/kWh and potential of reducing the cost to 4 cents/kWh in the future. Both companies are planning an integrated project of 5 MWe of renewable electricity and 1-3 millon gallons/yr of biodiesel. This will pave the way for future deployment of combined systems producing renewable low-cost electricity and biodiesel. The companies are at a design stage and will release the actual scope of the project in Q3. _GCC

Some analysts are projecting a 43% annual growth rate for algal biofuels over the next few years.

Elsewhere on the biofuels front -- just to remind us that this is not your grandfather's era of biofuels -- Amyris officially enhances its collaboration with French oil giant Total to produce fuels and chemicals precursor farnesene, from plant based sugars. The stock price for Amyris subsequently jumped.

The long term prospects for algal and microbe produced chemicals and biofuels is excellent, although in the shorter to intermediate term, competition from natural gas-based chemicals and fuels will be fierce.

Uninformed persons, along with the fringe doomer elements in the peak oil movement, remain largely ignorant of the multi-pronged efforts to produce a wide range of substitute fuels and chemicals, replacing crude oil as a feedstock.

Besides the fact that the global affordable hydrocarbon resource is much larger than previously imagined, biomass production and potential biofuels output, is subject to rapid growth as more of the Earth's surface -- including the oceans and deserts -- become viable for production of biomass.  This biomass resource will not be needed for a matter of decades, but by then the technology for optimal production, densification, and refinement, should be ready.

It is largely a matter of economics, although politics plays a significant role -- given the many highly placed lefty-Luddite green dieoff.orgiasts who occupy important roles in many western governments.

More on Primus Green Energy's Use of Natural Gas as a Bridge Feedstock

Primus Green Energy Multi-Feedstock Synthetic Fuels
Here is another look at Primus Green Energy and its compromise use of cheap natural gas as feedstock -- in place of the original plan to use biomass feedstock. Just like Sundrop Fuels, Primus Green Energy is behaving in a pragmatic and flexible fashion, to establish proof of technology first, and to develop the essential cash flow which will allow them to proceed with their longer range plans.

The Hillsborough, New Jersey-based company has developed a process for converting biomass into gasoline, jet fuel, and other chemicals. But because its biomass technology isn't quite ready for prime time and its process works with natural gas, its first demonstration plant will use natural gas as a feedstock.

"We're using natural gas as either a bridge to biomass or a bridge to natural gas," says CEO Bob Johnsen, a biofuels veteran who joined the company in March. "We can develop our processes for biomass while concurrently producing product at larger scale."

The company broke ground on the demonstration plant last week and is seeking to raise $60 million to $70 million for a commercial-scale operation which it hopes to begin building later this year or next year. To date, it raised $40 million from conglomerate Israel Corp. in 2007.

Johnsen, a co-founder of Mascoma and the company which became Verenium, was attracted to Primus Green Energy because the flexibility of its technology and because it's at stage where it can be scaled up, he says.

The company has modified a 1970s-era process called Methanol to Gasoline (MTG) originally developed by Mobil. Its plants have multiple steps but the core technology is converting synthesis gas, or syngas, into gasoline or jet fuel. That syngas can be made either from biomass, such as wood pellets or miscanthus, or from natural gas using a steam reformer. Because it's biomass-to-syngas gasifier didn't achieve the performance needed, the company will move ahead with natural gas first.

Once the syngas is produced, the gas is treated with catalysts to produce methanol and then fed into a reactor to synthesize the gas into liquid high-octane gasoline or jet fuel. The company has modernized the MTG process and engineered a more efficient system using a combination of its own inventions and off-the-shelf products, executives say. _TechnologyReview

There is nothing wrong with biomass to liquids in principle. But BTL cannot compete with either GTL or CTL in today's marketplace. And if the price of crude oil keeps dropping, even GTL will be unable to compete with oil.

It is fine to be idealistic. But if you are in business, you will need to temper your idealism with a healthy dose of realism, based upon current and near-term future market conditions.

Sundrop's Methanol to Gasoline Plant to Use Exxon Mobil MTG

The methanol-to-gasoline (MTG) process developed by Exxon Mobil doesn't care where the methanol comes from originally. MTG turns methanol into gasoline regardless of the original source -- natural gas, coal, biomass, etc.

Exxon Mobil Methanol to Gasoline Process

Economics will dictate whether the overall process can be profitable in the current marketplace -- and business startups had best pay attention to a thorough economic analysis before the first shovelfull of dirt is dug.

Sundrop Fuels Inc. intends to fight the current economic conditions of cheap natural gas and cheap coal, in order to prove a point. Sundrop wants to prove that it can fight the markets and survive, while producing "green gasoline."

Sundrop Fuels will use a multi-phase process to convert sustainable forest waste into a bio-based drop-in gasoline for use in today’s combustion engines. A gasification process converts the forest waste combined with hydrogen from natural gas into a synthesis gas, which will then be converted into methanol and then into gasoline in a fixed bed reactor system via the MTG process.

The MTG process first dehydrates methanol to dimethylether (DME); an equilibrium mixture of methanol, DME and water is then converted to light olefins (C2-C4). A final step synthesizes higher olefins, n/iso-paraffins, aromatics and naphthenes. The shape-selective catalyst limits the synthesis reactions to 10 carbons.

MTG reactor product is separated into gas, raw gasoline and water. Raw gasoline is separated into LPG, light gasoline and heavy gasoline; heavy gasoline is hydro-treated to reduce durene content, then heavy and light gasoline are re-combined into finished MTG gasoline. The result is sulfur-free gasoline with a typical 92 Research Octane.

The gasoline yield represents 38% of the feed, and 87% of the hydrocarbon product. Water (H2O) represents 56% of the feed.

The company’s first facility will also provide an operational platform for Sundrop Fuels to begin field integration of its proprietary RP Reactor radiant particle heat transfer gasification technology. The super-efficient, ultra high-temperature process will drive Sundrop Fuels’ future massive-scale biofuels plants, planned to produce more than 300 million gallons of renewable, drop-in biofuels annually.

Plans are for Sundrop Fuels to achieve a combined production capacity of more than one billion gallons by 2020—a significant percentage of the cellulosic advanced biofuels goal set by the nation’s Renewable Fuels Standard (RFS).

Significant backing for Sundrop Fuels comes from Chesapeake Energy Corporation, the largest producer of natural gas in northern Louisiana’s Haynesville Shale Field and second-largest producer in the nation. Chesapeake invested $155 million in Sundrop Fuels in mid-2011. The company’s investors also include two of the world’s premier venture capital firms, Oak Investment Partners and Kleiner Perkins Caulfield & Byers. _GCC

As we mentioned in an earlier posting, Sundrop will prove much of its technology using natural gas as a feedstock Sundrop will use natural gas to power its gasifiers and as a hydrogen donour -- thus explaining their success at raising capital from Chesapeake Energy Corp. Chesapeake needs to prove that GTL can be profitable -- either using MTG or using Fischer Tropsch to make diesel -- and it needs to help boost as many other uses for natural gas as possible. Chesapeake doesn't care how the gas is used so long as it is profitable.

Sundrop's pragmatic move to the initial use of natural gas for its MTG plant instead of using solar powered gasifiers, demonstrates a certain flexibility that is extremely important, if a "green business" is to stay in business.

First establish a cash flow while proving and perfecting your processes. Then you can branch out.

First Prove Yourself & Make Money -- Then You Can Go Avant - Garde

Sundrop Fuels was forced to learn a basic axiom of business: First create a reliable cash flow. Then you can branch out into more experimental areas.

The decision to use natural gas rather than solar heat reduces costs: in part due to recent low natural-gas prices, it's far cheaper to burn that fuel than to build a field of mirrors to concentrate sunlight. The natural gas, in addition to heating the gasifier, will also provide a source of extra hydrogen. The ratio of hydrogen and carbon in biomass isn't the same as in gasoline—the hydrogen from natural gas makes up the difference, increasing the fuel yield from biomass. The other option would be a reaction that uses carbon monoxide to produce hydrogen from water—but that would lower yields and force Sundrop to truck in more biomass. Switching to natural gas had another benefit. As with the decision to use conventional gasification technology, it has helped Sundrop finance its first plant. It attracted $155 million in funding from natural-gas producer Chesapeake Energy, which was seeking to fund technologies that would increase demand for natural gas. _TechnologyReview

It is relatively easy -- although expensive -- to turn woody biomass into gasoline, using high temperature gasification. Colorado solar startup Sundrop Fuels has a solar powered biomass gasification design for biomass-to-gasoline that could actually work, if they could only get the financing.

But getting a process to work, and making money, are two different things. Before Sundrop can prove its process works, it first has to do something to support itself long enough to provide proof of concept.

And so Sundrop is turning to natural gas to power its gasification process, hoping that the more conventional approach will generate mainstream financing which will then give them time to prove their "solar biomass gasification" approach.

Sundrop plans to start construction on the plant—which will have a 50-million-gallon capacity—later this year near Alexandria, Louisiana. It recently announced a partnership with Uhde Corporation of America, a partner of the German engineering firm ThyssenKrupp Uhde, to develop the detailed engineering plans for the plant. Uhde will also supply a gasifier that turns biomass into carbon monoxide and hydrogen, which can be converted with the help of catalysts into a variety of fuels.

Sundrop had planned to use its own proprietary gasification technology, which operates at high temperatures—over 1,200 ⁰C, or hundreds of degrees higher than some other gasifiers. The heat would be generated by concentrating sunlight, rather than by burning the biomass, the approach taken by other companies. Using heat from the sun would increase the amount of biomass that ends up as fuel, reducing the cost of transporting the bulky material. Operating at high temperatures would avoid the production of tars that can gum up equipment and interfere with later steps in the process.

Sundrop will continue to use high-temperature gasification to avoid tar production, but it will use a design from ThyssenKrupp that requires the introduction of oxygen. ThyssenKrupp's technology is more expensive than Sundrop's gasification technology, says Wayne Simmons, Sundrop's CEO, but it's commercially proven, which makes it easier for Sundrop to get loans to build a plant. Sundrop plans to prove its own technology by installing one of its gasifiers in the new plant, where it will be used to make about 10 percent of the plant's output. Sundrop plans to use its gasifier technology on a larger scale in future natural-gas-powered plants.

_Technology Review

The problem with Sundrop's plan is its timing: Natural gas will not always be this cheap, and there is no guarantee that Sundrop will have perfected its solar gasification technology when gas prices rise.
When gas prices rise, there is at least an even chance the company will be stuck with rising operating costs, with no quick or sure way to recoup their losses soon enough to save the company.

Sundrop's bottom line depends upon the shifting sands of carbon politics. Sundrop needs government mandates, carbon credits, carbon taxes, government subsidies, and all the things that US President Obama promised he would bring to the market when he was first elected.

Let's be honest: It is probably cheaper at this time to turn natural gas into gasoline or diesel than to use natural gas to turn wood into gasoline or diesel. Sometime in the distant future, using solar heat to gasify wood, turning it into liquid fuels, may make sense.

It would be good to have such technology available should the need for it arise.

But the best form of high quality industrial process heat for large scale operations -- even when the sun doesn't shine -- is likely to be HTGRs (high temperature gas cooled nuclear reactors). 24 hour high temperature process heat, anywhere on the planet, any time of year, rain or shine.

The solar sentiment displayed by ventures such as Sundrop is completely understandable. But getting that sentiment to work out in dollars and cents is a very difficult proposition.

An Early Conception of a Biomass to Liquids Economy

Given a sufficiently large production scale, liquid fuels such as diesel produced from crop residue could be economically competitive with petroleum-derived fuels at current price levels, suggests a new study by a team from the Stevens Institute of Technology. Their analysis is published in the ACS journal Energy & Fuels. _GCC

GCC
A recently published study in ACS Energy & Fuels claims that a particular conception for biomass to liquid fuel (Fischer Tropsch diesel BTL) can compete with petroleum diesel today. The overall BTL system involves collection of baled biomass at a local pyrolysis plant, where the solid biomass is converted to a much more energy-dense liquid pyrolysis product. The pyrolysis product is more economical to ship to central biorefinery plants which transform the pyrolysis product into diesel using gasification and Fischer Tropsch catalytic synthesis.

James Manganaro and Adeniyi Lawal performed a preliminary analysis of an integrated “Biorefinery Collective” biomass-to-liquids process based on distributed fast pyrolysis and centralized autothermal reforming (ATR) followed by Fischer-Tropsch synthesis. Assessing plant sizes of 2,000, 10,000, and 35,000 dry tonnes per day of biomass at 8% return on capital, they found required sales prices (exclusive of tax) of $3.30, $2.40, and $2.06 per gallon, respectively. The process comprises:

harvesting surplus biomass such as crop residue;

locally pyrolyzing the biomass into pyrolysis oil (PO), char, and noncondensable gas (NCG);

transporting the produced PO to a remote central processing facility;

converting the PO at this facility by autothermal reforming (ATR) into synthesis gas (CO and H2), followed by, at the same facility,

Fischer−Tropsch (FT) synthesis of the syngas into diesel fuel. _GCC

This is not a novel concept. But this approach is still in the early stages of development, in terms of becoming economically competitive.

Low natural gas prices help to make the process more competitive in one sense -- as a cheap industrial heat source. But cheap natural gas is a natural competitor feedstock against biomass, for F-T synthesis of diesel. Inexpensive high quality heat from high temperature gas-cooled modular nuclear reactors makes more sense as an industrial heat source for both BTL and GTL, than natural gas which is better used as a feedstock.

In other bio-energy news, Proterro has bioengineered a promising strain of cyanobacteria which is capable of cheap, high-yield production of very pure sucrose from CO2 and light. The company claims to be able to produce 10 X more sucrose per acre using bioreactors than is achievable from sugar cane production of sucrose.

CO2 isn't cheap in pure reagent form, of course. For Proterro to deliver on its claim of pure sucrose at less than $0.10 per pound, it must guarantee a cheap and reliable source of pure CO2. Cheap sugars will change the economic calculus of fermentable biofuels, once they become available in large quantities.

How Long Before Half of Global Energy Comes from Non-Fossil Fuels?

Daniel Yergin thinks it will take about 40 years to half-wean the world off fossil fuels. Vinod Khosla thinks it will take only 25 years for a global half-wean. Khosla is very optimistic about the future of biomass to liquids (BTL).

Up until the past year or two -- with the explosion of shale gas discoveries world-wide -- Al Fin energy consultants would have been closer to Mr. Khosla's estimate. But as the technologies of CTL and GTL begin to utilise nuclear process heat as an energy source, it grows more likely that synthetic fuels from natural gas, coal, and a combination of gas & coal will give fossil fuels liquids a big multi-decadal boost, beginning in the 2020s.

WSJ

MS. STRASSEL: How many years do you think it will be before half of our global energy production comes from non-fossil fuels?

MR. YERGIN: World energy probably is going to grow by 25% or as much as 35% over the next 20 years. I think the shift in the composition won't be too significant until after 2030, so maybe by 2050.

MR. KHOSLA: I guess 25 years. I'm definitely more optimistic.

...MS. STRASSEL: Vinod, in the past, you've talked about black-swan technologies—the idea of some innovative idea coming out and turning everything on its head.

MR. KHOSLA: Shale gas was a black swan. And my point is black-swan technologies will show up again. Shale gas was some combination of fracking, which we already knew how to do, and horizontal drilling that changed the assumptions around natural gas from "we need to import $100 billion worth" to "we can export it." The same thing will happen if an oil equivalent can be produced in country at $60 to $70 a barrel.

As soon as liquid-fuel technologies from things like wood chips, which are scalable, start to reach that level, our assumptions will change. _WSJ

Virgin Australia Eyes Eucalyptus Pyrolysis for Renewable Jet Fuel

Advanced catalytic pyrolysis has always been a favourite method of biofuels production among Al Fin energy analysts and consultants. The trick is in finding the right form of cheap and prolific biomass, and combining it with the best catalytic processes and sources of hydrogen. Virgin Australia thinks that Eucalyptus mallee trees are a promising form of biomass, and the company is working with partners to develop viable advanced methods of catalytic fast pyrolysis.

Eucalyptus mallee trees, grown in Western Australia’s wheat belt, are sustainably harvested and converted to a feedstock. Mallee is indigenous to Australia and is well adapted to the environment. It is a suitable sustainable crop because it helps return salt-affected land to a productive state.

Mallee can be planted on farms alongside crops, and provide a range of environmental benefits and contribute to the long term sustainability of the overall farming operation. Growing these trees to make alternative fuels encourages large scale planting, which is expected to bring a range of environmental and social benefits to farmers and rural communities.

The pyrolysis thermal conversion process has yet to be recognized by the world’s fuels standards authorities. Airbus’ role includes supporting the approval and certification process so that Pyrolysis based fuels can be used for the first time in commercial aviation.

The project objective is to have a pilot alternative fuel production plant operating in Australia in the next year. The sustainability analysis is managed by the CRC, Airbus and the UK’s Manchester Metropolitan University.

In order to produce a biofuel that can be used sustainably in our current aircraft, it is important to have members from every part of the supply chain involved. Airbus will bring vast expertise in aircraft manufacturing to the consortium and we are very pleased to have a company of its caliber joining this promising Australian project.

—Virgin Australia Group Executive of Operations Sean Donohue

_GCC

It is likely that other forms of biomass are more prolific than eucalyptus. But the pyrolysis product of a particular biomass is just as important as the volume, as a feedstock for intensive processing into a final fuel or chemical product.

It is likely to be a decade or more before air carriers will be able to rely upon renewable jet fuels. But developing reliable substitute fuels before they are needed, is the sign of wise leadership.

Once the fascist orthodoxy of carbon hysteria is dethroned and dismantled from Australia's political power structure, Australians are more likely to look to intriguing methods of combining coal and coal seam gas for coal liquefaction. Such an approach to substitute fuels is likely to become economical on a large scale before advanced biofuels, all political constraints aside.

What Can We Expect from Biofuels?

When it comes to using biology to create energy and fuels, we are given a lot of choices, and are generating many more that did not exist in the past. Brian Westenhaus looks at US biofuels in the context of government mandates and limits.

Brian points to a recent article in Biofuels Digest which makes a case for "cellulosic butanol," a 4 carbon alcohol which can be easily added to either gasoline or diesel fuels as a fuel extender. Butanol is also a reasonably good drop-in replacement for gasoline in unmodified gasoline engines. In addition, butanol can be used as a valuable feedstock for chemical synthesis.

The plans laid out by Brian and by the author of the piece in Biofuels Digest are reasonable. But there is a lot more to biofuels than alcohols and standard crop biodiesels -- such as biodiesel from soy or rape. Biofuels from thermochemical processes, biofuels from algae, and biofuels from engineered micro-organisms, are all lining up to make an impact.

If you really want to expand biofuels production quickly, a better way might be to utilise standard industrial and chemical processes, such as catalytic pyrolysis and synthesis. Biomass to fuels conversion using thermochemical means such as catalytic pyrolysis offers a great deal of potential in terms of scalable fuels production that is renewable into the indefinite future, year after year.

The IH2 biomass to fuels process (via GCC) summarised above is the most promising of the thermochemical biomass approaches, according to Al Fin analysts. Using rapid growing micro-algae or macro-algae as feedstocks, the potential growing area for biomass expands to cover most of the planet, freeing up arable land for food crop use. Multiple harvests per year allow for continuous, year round processing of fuels. The scalable nature of biomass pyrolysis and the ability to utilise a wide range of potential feedstocks, allows such enterprises to locate virtually anywhere, to contribute to economies of virtually any size.

When such an approach to biofuels production is combined with the process heat of a nuclear reactor, it is clear that such an approach to scalable fuels and chemicals production could be carried out anywhere from the middle of Antarctica to the middle of the ocean to the middle of any desert or top of any mountain on the planet.

It is true that the shale gas revolution makes biofuels production non-competitive with natural gas as a fuel and a feedstock in many areas. But it is also true that biomass of one kind or another can be grown virtually anywhere, particularly with the assistance of plentiful process heat. Natural gas, on the other hand, cannot be harvested anywhere, and can be expensive to transport over long distances where pipelines are not in place. It is also true that advanced gene-engineered microbial biofuels will eventually replace thermochemical production of biofuels, and that after that, nanotechnological production of fuels and energy will replace microbial production of fuels. But that will take time.

For now and the near future, biofuels from biomass may be best suited for remote areas such as islands and other geographically isolated places, such as Sub Saharan Africa. Wherever transport costs for hydrocarbon fuels are excessive, the door is open to biomass biofuels, particularly in the tropics and near tropics.

In the long run, thermochemical and microbiological biomass biofuels will also be utilised in the more advanced parts of the world, as better, more high-value uses for hydrocarbons are devised.

The Earth is a biological planet. And contrary to what you may hear from the carbon hysterics, this biological planet thrives on plentiful CO2. If CO2 levels were to drop too far, the resulting human dieoff from starvation would be massive.

More: Geoffrey Styles recently commented on this topic

Brown Seaweed to Biofuels and Chemicals......Breakthrough?

The key benefits of BAL technology are:
Single Platform. BAL converts seaweed carbohydrates into one renewable chemical intermediate that is affordable and scalable for both fuels and chemicals.


Commercial Focus. Leveraging the single platform, BAL will first commercialize high-value products to generate early cash flow that simultaneously paves the path for larger market opportunities.


First Mover Advantage. With over 60 patents or patents pending, BAL has carved a broad IP estate for the use of seaweed as a biomass for chemicals and fuels.

Products
BAL has developed a diverse product portfolio that provides large market opportunities at varying price points. Products include road transport fuels, green plastics, surfactants, agrochemicals, synthetic fibers and nutraceuticals. _BioArchitectureLab

BALWhat did the researchers at Bio Architecture Lab actually achieve?

Prospecting macroalgae (seaweeds) as feedstocks for bioconversion into biofuels and commodity chemical compounds is limited primarily by the availability of tractable microorganisms that can metabolize alginate polysaccharides. Here, we present the discovery of a 36–kilo–base pair DNA fragment from Vibrio splendidus encoding enzymes for alginate transport and metabolism. The genomic integration of this ensemble, together with an engineered system for extracellular alginate depolymerization, generated a microbial platform that can simultaneously degrade, uptake, and metabolize alginate. When further engineered for ethanol synthesis, this platform enables bioethanol production directly from macroalgae via a consolidated process, achieving a titer of 4.7% volume/volume and a yield of 0.281 weight ethanol/weight dry macroalgae (equivalent to ~80% of the maximum theoretical yield from the sugar composition in macroalgae). _Science Abstract

They increased the fermentation yield of ethanol from brown algae by genetic tweaking of their microbial fermentation platform.

Seaweed can be an ideal global feedstock for the commercial production of biofuels and renewable chemicals because in addition to its high sugar content it has no lignin, and it does not require arable land or freshwater to grow. Globally, if three percent of the coastal waters were used to produce seaweed than more than 60 billion gallons of fossil fuel could be produced. Today, in many parts of the world, seaweed is already grown at commercial scale. BAL currently operates four seaweed farms in Chile and has had great success in growing seaweed at economically viable production yields.

...“BAL's technology to ferment a seaweed feedstock to renewable fuels and chemicals has created an entirely new pathway for biofuels development, one that is no longer constrained to terrestrial sources,” says ARPA-E Program Director Dr. Jonathan Burbaum. “When fully developed and deployed, large scale seaweed cultivation combined with BAL’s technology promises to produce
renewable fuels and chemicals without forcing a tradeoff with conventional food crops such as corn or sugarcane.” _BAL (PDF)

It is far easier to grow large quantities of macro-algae in the sea, than microalgae. Macro-algae is much tougher and holds together in large masses for easier harvesting. Up to 4 crops a year can be grown, at very rapid biomass rates.

It should be clear that by adding roughly 70% of the earth's surface area to one's potential crop growing area, the limits to biomass growth have been expanded considerably.

H/T NextBigFuture

More from Green Car Congress

Is Origin Oil Finally Beginning to Understand Algal Energy Timeline?

Al Fin energy analysts have been telling algal fuels companies about the preferred and viable sequence of product production for some years now. Is it possible that top algal fuels company, Origin Oil, is finally beginning to listen? More on this possibility from a news release:

OriginOil’s planned Biocrude System™ will integrate its own harvesting system with state-of-the-art biomass processing technology being developed under the recently-announced research agreement with INL, to convert raw algae into barrels of renewable crude oil.

...Dr. Deborah T. Newby, Project Manager at DOE’s Idaho National Laboratory (INL) commented, “We are excited to work with OriginOil on its Biocrude System and leverage its algae processing expertise and technology. Algae is a high energy biomass and can function as a force multiplier to blend in other biomass waste such as from forestry and agriculture into a uniform renewable crude oil substitute. This may well support the U.S. military’s strategic fuels diversification program.” _Origin Oil News Dept._via_GCC

It is not clear why it is taking leading algal fuels startups so long to understand the evolving economics of their own industry.

Origin Oil's algal oil technology is quite advanced and state-of-the-art, but it is not ready to produce barrels of oil in high volume -- more like beakers of oil. The shale gas revolution has likewise been very unkind to the prospects for pure algal oil fuels in the marketplace, anytime soon.

Clearly if algal fuels companies are to impact the fuels market -- as opposed to markets for omega 3 oils and vegetable oils -- they will need a fast and dirty approach. Something like algal biomass pyrolysis with integrated hydrodeoxygenation and hydrotreatment (IH2). Which is what Al Fin energy analysts have been pushing for years now.

Pyrolysis of algal biomass is more logical than gasification, since some of the existing lipid in the algae might be condensed from the pyrolysis gases. With gasification, by contrast, everything is broken down to H2, CO, and spare change -- forcing you to start from scratch in synthesising what you want.

Is Origin Oil beginning to wise up to short to medium-term economic exigencies? We hope so. With the US military backing algal fuels producers and expecting a return on investment, they had better get on the ball.

More on the global project to expand biomass production beyond what is traditionally thought possible

Fast Catalytic Pyrolysis Conversion of Wood to High Value Chemicals

Huber says his research team can take wood, grasses or other renewable biomass and create five of the six petrochemicals that serve as the building blocks for the chemical industry. They are benzene, toluene, and xylene, which are aromatics, and ethylene and propylene, which are olefins. Methanol is the only one of those six key petrochemicals not produced in that same single-step reaction. _Newswise

The research engineers are developing more efficient and economical methods for entering the $400 billion petrochemicals market, using renewable biomass such as wood as feedstock. By targeting the high-value chemicals market, companies that convert biomass to chemicals can jump-start profits, while continuing to improve efficiencies and economies. The long-term goal is to devise competitive ways of producing hydrocarbon fuels from biomass, such as kerosene, diesel, and gasoline.

Chemical engineers at the University of Massachusetts Amherst, using a catalytic fast pyrolysis process that transforms renewable non-food biomass into petrochemicals, have developed a new catalyst that boosts the yield for five key “building blocks of the chemical industry” by 40 percent compared to previous methods. This sustainable production process, which holds the promise of being competitive and compatible with the current petroleum refinery infrastructure, has been tested and proven in a laboratory reactor, using wood as the feedstock, the research team says.

“We think that today we can be economically competitive with crude oil production,” says research team leader George Huber, an associate professor of chemical engineering at UMass Amherst and one of the country’s leading experts on catalytic pyrolysis.

...The new process was outlined in a paper published in the Dec. 23, 2011 edition of the German Chemical Society’s journal Angewandte Chemie. It was written by Huber, Wei Fan, assistant professor of chemical engineering, and graduate students Yu-Ting Cheng, Jungho Jae and Jian Shi.
“The whole name of the game is yield,” says Huber. “The question is what amount of aromatics and olefins can be made from a given amount of biomass. Our paper demonstrates that with this new gallium-zeolite catalyst we can increase the yield of those products by 40 percent. This gets us much closer to the goal of catalytic fast pyrolysis being economically viable. And we can do it all in a renewable way.”

The new production process has the potential to reduce or eliminate industry’s reliance on fossil fuels to make industrial chemicals worth an estimated $400 billion annually, Huber says. _Newswise

The thermochemical approaches to fuels and chemicals from biomass, are likely to achieve profitability more quickly than the microbial methods being attempted by Craig Venter and Jay Keasling. And yet, in the long run, the low temperature microbial approaches are likely to win out, due to the ability of microbes to reproduce themselves and to create their own catalysts.

Of course, once high quality process heat from gas cooled nuclear reactors comes along, all bets are off as to which approach will generate the higher profits in the long run.

Expanding Earth's Usable Biomass Production

There are several ways that the Earth's industrial production from biomass could be expanded significantly:

• Grow biomass in places currently thought unsuitable for growing
• Grow more useful biomass crops per year on the same surface area
• Achieve higher yield from each crop that is grown
• Improve the quality of biomass feedstocks

And so on. DuPont's investment in new hybrid varieties of sorghum aims to make improvements in all four areas above. By investing in hybrid sorghum that produces both sugar and higher yield biomass, can be planted on dry marginal pasture land, and has a short growing season suitable for crop rotation -- all of these point to perhaps 100 billion gallons of additional US biofuels without using valuable cropland or significant water resources.

DuPont and NexSteppe have entered into a collaboration to develop advanced feedstocks for biofuels, biopower and biobased products. The collaboration will focus on the development of new sweet sorghum and high biomass sorghum hybrids which will create additional feedstock options for these industries.

...Sorghum is naturally drought- and heat-tolerant and has the ability to grow in marginal rainfall areas with high temperatures where it is difficult to grow other crops. It has a relatively short growing season and is suitable for crop rotation systems. Sorghum is increasingly grown as a source of feedstock for industrial value chains.

Sweet sorghum can be used as a complement to sugarcane in existing Brazilian sugar to ethanol mills, and as a feedstock for advanced biofuels and other biobased products produced from sugars. High Biomass Sorghum is a high-yielding crop that can be used as a feedstock for biopower and cellulosic biofuels. DuPont, through its Industrial Biosciences business, operates and develops industrial processes that use sugar as a feedstock. _GCC

This represents a relatively modest increase in potential for biofuels and industrial biomass on the scale of the US economy, but in terms of regional benefits and downward pressure on fuel and food costs, it could lead to significant incremental benefit.

Of course the truly huge potential for boosting planet Earth's biomass output will lie in the oceans, coastal and tidal areas, saline soils, and deserts. Planet Earth is the only biological planet that we know of. Life grows wild high in the atmosphere, at the bottoms of the seas, deep inside the rocky crust of the planet. Even on the most isolated mid-sea islands, no sooner does a new volcanic lava cool, than new outposts of living matter spring up -- from the microscopic to the macroscopic.

One of the greatest limitations to the growth of biomass on the planet is the quite low concentration of CO2 in Earth's atmosphere -- compared to earlier levels when most life evolved. Perhaps we will need to find more efficient ways of generating CO2 and releasing it into the atmosphere, so that we can grow as much biomass as we may need?

BioBoost: One Rational Bioenergy Infrastructure

BioBoost will focus on the production of various energy-rich intermediate products from biogenous residues and on testing and evaluating them with regard to their usability in, for example, the bioliq process. In addition to the BioSynCrude generated by flash pyrolysis in the bioliq process, BioBoost will produce, optimize, and evaluate other intermediate products.


Moreover, the project will cover the analysis of economic efficiency of the complete process, optimization of logistics chains, and the investigation of environmental compatibility. The objective is to significantly improve the efficiency of the use of biomass and residues in the future.


In addition to the production of customized fuels, such as diesel, gasoline, or kerosene, scientists will also investigate the production of chemicals such as methanol, ethylene, and propylene as well as plastics. Generation of electricity and heat from the energy-rich intermediate product also is subject of BioBoost._GCC

Transitioning from an economic infrastructure that is almost wholly dependent upon fossil fuels, to a hybrid infrastructure which can utilise a wide variety of energy and power sources, will be an expensive and time-consuming process. It is a good thing that various groups -- including the BioBoost consortium in Europe -- are devoting the necessary time and due diligence toward devising a rational bioenergy infrastructure which can contribute economically to the energy and power infrastructure of the future.

BioBoost is one of two projects for the development of new energy carriers selected for funding under the 7th EU Research Framework Programme from numerous proposals. The project will have a duration of three and a half years and be funded by the EU with a total amount of nearly €5.1 million (US$6.6 million). Funding granted to KIT will amount to nearly €1 million (US$1.3 million).

...The BioBoost project concentrates on dry and wet residual biomass and wastes as feedstock for de-centralized conversion by fast pyrolysis, catalytic pyrolysis and hydrothermal carbonization to the intermediate energy carriers oil, coal or slurry. Based on straw, the energy density increases from 2 to 20-31 GJ/m3, enabling central GW-scale gasification plants for biofuel production. The catalytic pyrolysis reduces oxygenates in the oil to 13% enabling power and refinery applications.

The fast pyrolysis and HTC processes of demo-size (0.5-1 t/h) are optimized for feedstock flexibility, yield, quality and further up-scaling is part of the project.

...The complete bioliq biomass-to-liquids process consists of four stages:

Flash pyrolysis at decentralized plants to convert low-energy-density biomass waste into a petroleum-similar intermediate product of coke and oil: bioliqSyncrude.

Dry residual biomass is distributed over wide areas and has a low energy content; the resultant biosyncrude contains about 90% of the energy stored in the biomass, with an energy density more than 10 times as high as that of the feedstock. The resulting biosyncrude can be transported economically for further upgrading.

In the next stage, the energy-rich intermediate product is converted into synthesis gas, a chemically reactive mixture of carbon monoxide (CO) and hydrogen (H2). In the course of this process, the bioliqSynCrude is mixed with oxygen and decomposed into the basic elements of synthesis fuels under pressure and at temperatures above 1000 °C.

Hot-gas cleaning removes impurities, such as particles, chlorine, and nitrogen compounds from the synthesis gas. KIT is using a new technology; cleaning will take place at 500 °C, as a result of which energy consumption will be reduced compared to conventional processes.

In the final process stage, the basic elements are combined specifically in tailored designer fuels. Depending on the synthesis path, either diesel or gasoline can be generated.

_GCC

Notice how this project incorporates the crucial early step of energy densification. Biomass lacks the energy density of fossil fuels, and must be densified in pre-processing stages prior to long-range transportation, or intensive refining.

Flash pyrolysis is one method of densifying biomass for transport and further refinement. If inexpensive, decentralised flash pryolysers can be mass produced, such devices could be located close to the point of biomass production.

Such an infrastructure supports a multi-tier, decentralised economic infrastructure, which could potentially revitalise biomass-rich rural areas. Multiple layers of pre-processing, processing, and refining could take place at varying locations -- depending upon the needs of the local economies.

Such a widely dispersed economic infrastructure would have a different impact upon a regional economy than the somewhat more centralised industries of oil, gas, and coal production and refining.

While biomass farmers and foresters would not enjoy the opulent lifestyle of an oil executive, they could enjoy a comfortable lifestyle in the rural setting they preferred. While local and regional bankers providing financing for small and moderate scale biomass enterprises would not receive the multi-million dollar bonuses of a Wall Street investment banker, they would live well enough, and take satisfaction in contributing to the modest prosperity of their communities.

The lower energy density of biomass does not have to prevent the profitable utilisation of the resource, as long as participants are willing to make essential tradeoffs in lifestyle and location.

And for third world nations and isolated tropical island nations, a well-crafted bioenergy infrastructure might make the difference between energy self-sufficiency and energy penury.

A Fruitful Collaboration Between Industry and University in Montana

Blue Marble Agate
Blue Marble Energy (BME) moved from Seattle to Missoula, Montana, in order to be close to its collaboration with the University of Montana. Together, UM and BME are working to solve a number of mundane but important problems that occur where energy, chemistry, economics, and the environment overlap.

Two geoscience faculty members at The University of Montana (UM) have started a partnership with Blue Marble Biomaterials to produce commercial products from algal biomass.

Potential products include organic fertilizers, natural pigments, food flavorings, fatty acids for biofuels, cholesterol-reducing compounds for food additives, and natural anti-inflammatory and anti-cancer drugs. Natural inputs and nontoxic production methods will give potential products a competitive advantage over similar products produced from petroleum and other nonrenewable sources.

...Stephens says UM’s favorable attitude toward industry partnerships was one factor in the decision to move the company from Seattle to Missoula in 2010.

Partnering with UM is key to our research and development program. Innovation happens at the nexus of science and market opportunity. This partnership combines Blue Marble’s expertise in chemistry, microbiology and industrial manufacturing with the University’s excellence in research methodology, geoscience and biology. By combining these strengths, we are able to take advantage of an existing market opportunity.

—James Stephens

Blank notes that such industry partnerships also offer educational opportunities for UM students. Since 2010 Blue Marble has hired six UM graduates, including four students from the College of Technology. Currently, Blue Marble hosts five interns from UM who gain broad experience in biology, chemistry, engineering and business operations. _GCC

Earlier article on BME

Blue Marble Energy’s AGATE (Acid, Gas, and Ammonia Targeted Extraction) technology utilizes modified anaerobic fermentation (like brewing beer) and non-GMO bacterial consortia to produce biochemicals, biomethane, biohydrogen, and nitrogen compounds. BME scientists encourage bacterial conjugation between select strains that specialize in the breakdown of different feedstocks. The conditioning of these consortia creates flexible and resilient bacterial cultures that perform well in high nitrogen environments and can withstand shocks to the system (such as changes in pH, temperature, and feedstock). This allows AGATE to process nearly any organic biomass: food waste, yard waste, spent brewery grain, algae, milfoil, corn silage, etc. AGATE can handle both fresh and wet feedstock, and can be adjusted to meet changing economic opportunities and market needs. _BME

This symbiotic multi-microbial approach would seem to be a more versatile way to deal with the conversion of biomass to useful materials and energy, and it reflects on a microbial level the symbiotic collaboration between BME and UM on the macro level.

Gene Expression Boosts Algal Biomass by 50 - 80%

Martin Spalding
Scientists at Iowa State University have taught algae to rev its biomass production engines at full speed -- even in the presence of artificially high CO2 levels. They succeeded in boosting algal biomass production by between 50% and 80% in high CO2 environments, as a result. This is a revolutionary discovery, since algae is already the most prolific biomass crop available, and grows in salt water, brackish water, wastewater, as well as fresh water.

In nature, algal growth is governed by the amount of carbon dioxide available. In relatively low carbon environments [such as Earth's atmosphere], two genes — LCIA and LCIB — are expressed to capture more CO2 and direct it into the cells, promoting growth. However, when algae live in an environment with enough CO2 to promote growth, the two genes shut down. The researchers found that expressing them, even in carbon-rich environments, significantly increases growth.

“Based on some prior research we had done, we expected to see an increase, probably in the 10 to 20 percent range” researcher Martin Spalding (pictured) said in a statement. “But we were surprised to see this big of an increase.”

Spalding first tinkered with each gene individually to see what effect it had on the algae, Chlamydomonas reinhardtii. Expressing them individually yielded a 10 to 15 percent increase in biomass. Expressing them together boosted it 50 to 80 percent.

The excess biomass naturally becomes starch, increasing the biomass around 80 percent. Using existing mutated genes, Spalding can direct the algae to make oil instead. That requires more energy, increasing biomass just 50 percent.

Algae are attractive biofuel feedstock because it grows quickly and thrives in everything from seawater to irrigation runoff to sewage. _Wired

Earth's atmosphere possesses pitifully low levels of carbon dioxide. If the levels of CO2 were reduced very far, all plant life on Earth would die, the gas is so scarce. Plant life craves more CO2, and typically thrives in greenhouses with artificial CO2 levels up to 3X atmospheric CO2 or higher. If producers could nearly double the biomass production of algae by exposure to high CO2 environments, the area required for algal growth for any particular target of production, would be cut in half.

Most analysts assume that it is the lipid component of algae that must be maximised in order to make algal biofuels and chemicals viable, but that is not necessarily true. Using a process known as IH2 (integrated hydropyrolysis and hydroconversion), raw biomass can be converted to high value chemicals and fuels directly.

Eventually, it will become easier to tweak algae to produce very high volumes of oils and other particular chemicals directly. But that may take between 10 and 20 years. There is no need to wait for that, when IH2 technology can make algal fuels and chemicals affordable much sooner. Particularly when combined with augmented growth approaches such as devised by the Iowa State researchers.

Wilderness Refineries to Produce Gasoline from Wood?

CORE BioFuel Inc. intends to turn millions of tons of forestry wood waste and bark beetle kill into gasoline.

Images via CORE BioFuel Inc

Under contract with CORE, RECAT Technologies Inc. successfully completed a set of test runs of the catalytic reaction producing gasoline from dimethyl ether (DME), the only to date non-commercialized step in CORE’s patent-pending MKS Gasoline Synthesis Process.

Our reaction performs even better than we expected, with excellent conversion of DME to gasoline. The catalyst for this reaction did not produce benzene—which the EPA has determined should not be present in gasoline unless lower than their current criteria levels. Removing benzene is difficult and expensive and our process does not incur this cost. Utilizing similar operating parameters, our reactor actually produces a gasoline superior to ExxonMobil’s well-known commercial MTG (Methanol-to-Gasoline) process. Our gasoline octane rating is 94, which means it can be blended successfully with lesser grade refinery gasoline to meet retail pump 92 octane requirements. Our testing also determined that operating costs will be lower because we have less volume to recycle than in an MTG process—we produce more of what we want and less of what we don’t want. Our catalyst also costs less, and is a robust catalyst, which can be re-used.

—Larry Melnichuk, Vice President of Process Design and Development

CORE says the MKS Th technology is industrially proven and the process is a scalable, efficient, cost effective approach to producing carbon neutral, benzene-free gasoline. _GCC

CORE’s patent-pending MKS (Melnichuk-Kelly-Stanko) Gasoline Synthesis Process is a thermochemical process combining gasification and catalysts to produce an essentially carbon-neutral 92 octane gasoline (Zero Fossil Input (ZFI) Gasoline), according to the company.

Incoming biomass is chipped and dried to the desired moisture content. The dried wood chips are fed into a gasifier where they are converted to a synthesis gas and inert ash. The synthesis gas is then processed through a series of catalytic steps, with the end products being gasoline and distilled water. Conventional heat exchangers and steam turbines are used throughout the plant to produce sufficient electricity to operate the facility.

The Houston, British Columbia demonstration plant will produce approximately 18 million gallons of gasoline, 6 million gallons of distilled water, and will generate its own electric power. _GCC

This approach is energy intensive, and suitable only where large quantities of biomass are availoable at low cost. Overall profitability will depend upon the ability of the operators to keep costs low, as well as ingenuity in marketing products and co-products.

The company claims that its process is profitable without government subsidies. But the company also seems to be angling for carbon credits of some type, and appears to be framing its process to fit into pre-existing government mandates.

Realistically, natural gas GTL processes should allow more profitable production of unconventional liquid fuels at today's low prices for gas, for most industrial regions.

The economics of biomass to fuels for remote areas and islands far off from mainland, may tip the balance toward the biomass approach in some cases, where biomass growth is prolific and fossil fuel access is exceptionally expensive.

Garbage Gasification Power Gaining Global Traction

Dozens of companies -- large and small -- are vying for the rights to access municipal waste disposal landfills, to get in on the riches of fuel and power from garbage.

The US military has been in the forefront of the gasification of garbage for purposes of sanitation and energy production. First the US Army, next the US Air Force, and now the US Marine Corps are learning how to fit small, portable gasification plants into their strategic planning.

One company has signed a billion euro agreement which allows it to mine many of the world's landfills for solid waste to turn into fuels and power, via gasification.

This is one form of decentralised power and fuels production at its most extreme, since the sources of garbage are even more decentralised and diffuse than the sources of biomass, if one starts at the beginning. The same is true for municipal sewage, which can also be turned into fuels and energy.

It has been worth society's while to create an infrastructure for centralising and disposing of wastes and garbage -- for purposes of sanitation alone. How much more will it be worth developing even better infrastructure to achieve both sanitation and energy + fuels?

Danish Researchers Attempt to Match Biomass Resource to Markets

GCC
It is important for healthy economies to match their resources to their markets as carefully as possible, to avoid waste, misallocations, and shortages. In the case of biomass, there is some debate among chemical engineers about the preferred suitability of biomass -- either for biofuels or for renewable chemicals. Certainly the high value chemicals market would provide a quicker payoff for a newly developing biomass to chemicals industry, which is just beginning to scale up. That is the argument of Danish researchers, who claim that the chemistry and quantity of available biomass makes it more suitable for renewable chemicals than for biofuels.

Switching to broad use of biomass for chemicals will require divergence from the established value chains, the authors say. Instead of using brute force to convert these raw materials into specific platform chemicals that were originally selected because of their easy accessibility when starting from fossil resources, it would be better to use the interesting chemical characteristics already available in the biomass resources themselves and to optimize the use of favorable catalytic reaction pathways.

Because the development costs will be high and the first processes inefficient, it makes sense to initially concentrate on high-value products, thereby allowing for faster widespread adoption. _GCC

GCC

It is also not the most sensible solution to convert biomass into fuels. In the first place, the amount of biomass available does not meet the demand for fuels; in the second, the chemical characteristics of fuels and biomass are too different, so the processes would be too complex and uneconomical.

In contrast, it really makes sense to use biomass as the feedstock for chemical industry. The available biomass should suffice to replace the fossil feedstocks used in the production of chemicals. The chemical characteristics of biomass and many bulk chemicals are also very similar, so the processes should be more economical than those for the conversion into fuels.

—Esben Taarning _GCC

Long time readers of Al Fin Energy might expect Al Fin energy analysts to agree with some points of the argument, and disagree with others. That is the case.

In the short and medium term, the Danish researchers are correct that high value chemicals are a better market to aim for than the very competitive fuels market. This is the case for all the reasons mentioned by the Danes in the article above.

In the longer term, with improved catalysts and processes -- as well as a vastly enlarged biomass production infrastructure -- biomass is likely to play an important role in the liquid fuels market. Whether that role will be to supply sugars for fermentation into hydrocarbons, or whether the biomass will be converted directly into hydrocarbons using catalysts and process heat from gas-cooled nuclear reactors, biofuels will almost certainly be ready to jump into the arena at the same time that demand for hydrocarbons will begin to drop -- sometime after the year 2020.

The coming biofuels and chemicals-from-biomass infrastructures are likely to yield lower profits than the petrofuels and petrochemicals markets have yielded. But one of the main reasons for that -- besides the diffuse nature of the bioenergy resource -- is the distributed nature of the new bioenergy infrastructure itself. This means that a lot more people will be involved, collecting more modest incomes than oil executives, but making a fair living nonetheless.

The bioenergy economy is most likely to succeed in regions such as SubSaharan Africa, large numbers of tropical islands, and other third world areas in the tropics. But bioenergy and renewable chemistry are also likely to cut out significant and viable niches in the emerging and the developed world, over time.

More interesting work from some of the same authors

This Is How Biofuels Can Make Monkeys Out of Energy Analysts

Image Source
Using the IH2 (integrated hydropyrolysis and hydroconversion) technique developed by GTI, and licensed by Shell subsidiary CRI, making high quality gasoline and diesel directly from cheap biomass has suddenly become a viable prospect.

So far, New Zealand based company Aquaflow (PDF) appears to be taking the lead in developing practical uses for this technology. Aquaflow has an agreement with CRI to develop waste biomass to gasoline and diesel plants, and is planning the first of these plants in Queensland, Australia.

EERE PDF Image Source
Aquaflow is developing the use of a mixed feedstock approach to IH2 conversion, which is able to incorporate wood waste, agricultural waste (such as cane bagasse), and micro-algae biomass, among other forms of cellulosic biomass. Such an approach allows for a versatile approach to feedstock supply, allowing such plants to negotiate the best pricing for feedstock from a wide array of sources.

EERE PDF Image SourceWhile there are plenty of other approaches to producing high quality hydrocarbon fuels from waste biomass, the IH2 approach as approached by Aquaflow appears to be the frontrunner.

According to Al Fin energy analysts, micro-algae and macro-algae are the most prolific biomass crops available. They can be grown in salty and brackish water, as well as waste water. In fact, over 80% of the Earth's surface is suitable for growing algae biomass, due to the ability to grow algae in saltwater (oceans), in the deserts, or in freshwater.

It makes sense to combine the most prolific form of biomass with the most efficient process for converting biomass to high value fuels, at least in the short to intermediate term.

Long-term, we are likely to see synthetic biological approaches to producing fuels and chemicals which will be very difficult to compete against, for thermochemical approaches such as pyrolysis or gasification. On the other hand, once advanced nuclear energy technologies are finally adopted, there should be no shortage of cheap process heat available for driving a wide range of clean thermochemical conversions to fuel and chemicals -- including biomass to liquids, gas to liquids, coal to liquids, kerogens to liquids, bitumens to liquids, gas hydrates to liquids, etc etc.

New University of Maine Thermal Deoxygenation Process Biocrude

A University of Maine chemical engineer and his research team have developed a new process—thermal deoxygenation (TDO)—to transform biomass, including forest residues, municipal solid waste, grasses, and construction wastes, into a hydrocarbon fuel oil. The process requires no catalysts or hydrogen, and is “a spin on chemistry used to make acetone back in the 1800s”, said M. Clayton Wheeler, a UMaine associate professor of chemical and biological engineering. _GCC

The biocrude can be used as a substitute for heating oil, but for use as transportation fuel it would require further processing. Here are more details on the process:

The TDO process starts with the conversion of cellulose to organic acids. The acids are then combined with calcium hydroxide to form a calcium salt. That salt is heated to 450 °C (842 °F) in a reactor, which constantly stirs the salt. This produces a reaction resulting in a dark amber-colored oil.

The reaction removes nearly all of the oxygen from the oil as both carbon dioxide and water, and without the need for any outside source of hydrogen to remove the oxygen. Therefore, most of the energy in the original cellulose source is contained in the new oil.

Biomass has a lot of oxygen in it. All of that oxygen is dead weight and doesn’t provide any energy when you go to use that as a fuel. If you’re going to make a hydrocarbon fuel, one of the things you have to do is remove oxygen from biomass. You can do it by using hydrogen, which is expensive and also decreases the energy efficiency of your process. So if there’s a way to remove the oxygen from the biomass chemically, then you’ve densified it significantly. Our oil has less than 1 percent oxygenates. No one else has done anything like this.

—Clay Wheeler

The TDO process does not require an uncontaminated cellulose source; researchers in Wheeler’s lab at UMaine recently used unpurified, mixed carboxylates which were produced from grocery store waste such as banana peels, cardboard boxes and shelving to successfully make a batch of the fuel. _GCC

It is one thing to make biocrude from biomass. But to do it economically, at low cost, is another story. The economic viability of the U. Maine process above apparently depends upon being able to obtain waste biomass feedstock cheaply.

Here is the bottom line: Conversion of biomass to liquid fuels (BTL) must compete with gas-to-liquids (GTL) and coal-to-liquids (CTL), as well as conventional petrofuels, in the marketplace. For areas which are "biomass rich" and "gas and coal poor," BTL may have an advantage over GTL and CTL, as long as the feedstock can be obtained cheaply. If the new U. Maine process allows for cheap decentralised TDO processing close to the source of the biomass feedstock, it could shift the balance of costs in the favour of BTL -- for specific locations.

See earlier report on this line of research, which specifically mentions a sulfuric acid bath as one method for converting cellulose to organic sugars.