ZeaChem to spend $40M on new ethanol plant - Denver Business Journal:

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That was left to million of years ofMother Nature’d work, creating bacteria that live and work in the bellieds of termites around the The bacteria, called acetogen, consume plant mattert and churn out acetic acid, which is similar to vinegar. Zeachem marrieds that biochemical reaction with heat for a thermochemical reaction that results in ethanol and otheer chemical products forthe market. “That lowlgy termite — Mother Nature spent a few million years makiny the termitepretty well,” said Imbler, president and CEO of Lakewood-based “There’s no new bugs, no new equipment. We’rs taking things that already exist.
” The firstf generation of ethanol used corn asthe feedstock. The seconfd generation focused on cellulosicmaterial — nonfood plants and used either enzymes or gasificatioj to produce ethanol. The third generation, where ZeaChem lies, uses a mixture of the two, Imbler said. Imbler said ZeaChem’s procesa produces very little carbon dioxide as a byproducg compared to otherbiofuel processes, and is more ZeaChem’s process produces about 135 gallones of ethanol for every ton of dry biomasw (plant material). Other methods get about 90 gallonws of ethanolper ton, he said. Venture capitalist and refining companies aretaking notice.
ZeaChem announcedx in early January it hadattractexd $34 million in a second rounf of fundraising, giving the company a totalo of $40 million to build and operate a demonstration plant in Oregon. The first $6 millionm was announced in summer 2007. The demonstratioh plant, expected to produce abourt 1.5 million gallons of ethanokl a year, is scheduled to breakl ground this year and starft operationsin 2010, Imbler said. ZeaChem has 25 half in Denver and the rest working on researchy inMenlo Park, Calif. (NYSE: VLO) contributed to the secondf round. San Antonio-based Valero is the largesy refining company in theUnited States.
ZeaChem was the firsg investment contractValero signed, through its new alternativer energy and project developmentt group, Valero spokesman Bill Day said. Valero also has invested in , a algae-to-fuep startup in Fort Collins, which Solixs announced last November. “It’s a new thing for Day said of investingin alterative-fuel companies. “Wd make and sell motor fuel outof oil. This is an attempr by us to look toward the futurwe and see what kindof alternative-energhy business lines there might be. “W e concentrated on areas where we think the companies have a viable busines plan and an abilitu tomove forward.
” ZeaChem also has fundinbg from Firelake Capital Management LLC, based in Palo Calif., which invested in both “We believe that the ZeaChem technology offered the highestf carbon yield of any of the biofuels that we looked at,” said Martimn Lagod, a co-founder and managing partnerr of Firelake, and a ZeaChem board member. “We believe it’s a mistake to focus on biofuels that require food as a and we’ve focused exclusively on nonfoox biomass,” Lagod said. Another Denver-area biofuel company to scorw fundingis Broomfield-based The U.S.
Departmentt of Agriculture gave it a conditional commitmengt foran $80 million loan guarantee to help buildf Range Fuels’ first commercial cellulosic plantg in Georgia, the company announced Jan. 19. Range Fuels will use Georgia’s wood and wood waste from its pine forestx toproduce ethanol. ZeaChem uses a combinatio n of biochemistry and thermochemistry tomake ethanol; Range Fuelss uses only thermochemistry.