News

The promise of using algae to make biofuels — a dream scientists have chased for decades — might seem particularly welcome in a time of stubbornly high gasoline prices. But the path to commercial-scale production has been circuitous.

Young companies have attracted investors and interest, but as they struggle to make large quantities of ethanol and biodiesel at a competitive cost, some have branched out into making oils for products with higher profit margins, like cosmetics, food and soap.

Now, one of these companies, Solazyme, is about to take a step toward large-scale fuel production. On Tuesday, it will announce an agreement with Bunge Global Innovation to build a factory in Brazil that would make triglyceride oils for both chemical and fuel products.

Under the joint venture, whose financial terms were not disclosed, the factory would rise next to Bunge’s Moema sugar cane mill and have an annual capacity of 100,000 metric tons, or about 110,250 short tons, of oil. It would start production in the second half of next year, making oils for fuel as well as additives for soaps, detergents and plastics.

Ben Pearcy, a managing director of Bunge Ltd., a global agribusiness and food company, said in a prepared statement that the partnership would “enable us to link our sugar and vegetable oil value chains,” and expand the company’s reach in fuels and chemicals. For Solazyme, which has skin care and nutritional supplement lines, the arrangement provides a boost in production capacity “to meet the strong demand we’re seeing in our initial target markets,” said Jonathan Wolfson, the company’s chief executive.

So far, the company has produced only limited quantities of biofuels, including several hundred thousand liters to the United States military, which is seeking to promote alternatives to conventional fuels.

Solazyme, which is based in South San Francisco, Calif., bioengineers its algae so that it can convert sugars directly into oils without photosynthesis. This allows the organisms to be grown in fermentation tanks, which reduces the costs of a still-expensive process.

A competitor, Sapphire Energy, announced on Monday that it had secured $144 million from investors for its demonstration plant in New Mexico. Sapphire, which does use photosynthesis in its production process, has also received a $50 million grant from the Energy Department and a $54.4 million loan guarantee from the Agriculture Department, according to the company.

By DIANE CARDWELL