Algae Biofuel Company to Build 6 Factories Globally
Raising $600 Million in Funding
Algae.Tec Ltd. (ASX: AEB), a company that makes algal oils for clean fuel, is hoping to raise around $600 million as well as secure fuel supply deals that will enable it to build six factories in Brazil, Sri Lanka, Australia, and the U.S.—all by 2015.
“We will be using different project finance structures for all of these projects and they’ll all be roughly $100 million,” Chairman Roger Stroud said by phone from Sao Paulo.
Back in July 2011, airlines received U.S. approval to have passenger planes use compounds that are made from inedible plants and organic waste blended with fuel derived from petroleum. Up to 50 percent biofuel is acceptable.
Deutsche Lufthansa (ETR: LHA) became the first airline to routinely offer flights running on biofuel, and Algae.Tec announced on September 19 that it is working with the airline to develop a factory in the south of the region.
Production is expected to begin by 2015. The airline will not only provide some funding, but it will also buy at least half of the produced fuel at an undisclosed price.
Algae.Tec is also in discussions with Brazilian partners as it hopes to build one, possibly more, factories in that country. Over in Sri Lanka, it is working with Holcim Ltd. (PINK: HCMLY) to scope out a possible plant. And finally, it has claimed it is “well advanced” with investigations into possible facility sites in the southwest of America and Australia.