Will the marriage of an oil giant and a company dedicated to tweaking the genetic forms of life as we know them lead to a cheap, clean and renewable source of energy or a Frankenfuel of unpredictable consequences? Thanks to a new partnership, we might all have a chance to learn the answer.

The company led by the world’s top champion for artificial life development — J. Craig Venter — could receive more than $300 million (US) from oil giant ExxonMobil in a joint quest for the algae-based biofuel of tomorrow.

Synthetic Genomics Inc. (SGI), which focuses on genomic-driven technology fixes for a variety of global challenges, today announced today a multi-year research and development agreement with ExxonMobil Research and Engineering Company (EMRE) to develop new biofuels using photosynthetic algae.

Under the agreement, SGI will receive milestone payments for achievements in developing biofuel products. Total funding for SGI in research and development activities and milestone payments could amount to more than $300 million, with the potential for additional income from licensing to third parties.

In all, ExxonMobil expects to spend more than $600 million on algae-based biofuel research.

“We are confident that the combination of our respective expertise in science, research, engineering and scale-up should unlock the power of algae as biological energy producers in methods and scale not previously explored,” said Venter, SGI’s founder and CEO.

A previous venture of Venter’s — Celera Genomics — engaged in a race with the Human Genome Project to decode the complete genetic sequence of human life, with Celera taking a for-profit approach. Both efforts announced success in 2001, although the failure of Celera’s subscription-based model prompted the company to later part ways with Venter.

Venter has now pinned his hopes on genetics and biotechnology to solve many of the world’s problems, especially those related to energy.

Photosynthetic algae are naturally efficient at using the energy from sunlight to convert carbon dioxide into cellular oils … and even some types of long-chain hydrocarbons that can be further processed into fuels and chemicals. However, such algae in nature can’t do this at the efficiencies or rates needed for commercial-scale production of biofuels.

“Meeting the world’s growing energy demands will require a multitude of technologies and energy sources,” said Emil Jacobs, vice president of research and development at ExxonMobil Research and Engineering Company. “We believe that biofuel produced by algae could be a meaningful part of the solution in the future because of its potential to be an economically viable, low net-carbon emission transportation fuel.”

Tags: biofuels