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PetroSun BioFuels to Build 30M Gallon Algal Biodiesel Plant in Arizona

10 January 2008

PetroSun BioFuels Refining, a subsidiary of PetroSun, Inc., has entered into a joint venture to construct and operate a biodiesel plant near Coolidge, Arizona. The feedstock for the refinery will be algal oil produced by PetroSun BioFuels at company owned and operated algae farms to be located in Arizona.

The refinery will have an annual biodiesel production capacity of 30 million gallons. PetroSun BioFuels will process the residual algae biomass into ethanol.

The biorefinery and algae farm complex will generate all of its own electrical and heat requirements, utilize non-potable or saltwater, consume no fossil fuels and will be carbon neutral. The joint venture anticipates that all permits will be approved and construction on the biorefinery should commence during the third quarter of 2008.

(A hat-tip to Matt!)

January 10, 2008 in Brief | Permalink | Comments (39) | TrackBack (0)


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More good news. 30 million gallons is really big. They must be confident that it works.

I hate to say it, but I'll believe it when the facility is built and the oil is actually sold on the market.

I am with Cervus on this one. According to this paper, the facility would have to be at least 6,000 acres. That is TEN SQUARE MILES.

That's a HUGE facility. If it comes online, people will notice. Indeed, it would be the hallmark of a biofuels revolution.

I hate to say it, but I'll believe it when the facility is built and the oil is actually sold on the market.

Well, Cervus, the proof is always in the pudding of course. But if you check the background of this company, they are in the drilling business and have been for 30 years. They are also extremely conservative, only renting their rigs to the lowest risk projects.

To announce a project like this without having done their homework would make them, in a word, *morons*. So short of gross incompetence, acts of god, sabotage, terrorism, etc. I'd say there's about to be a successful 30 million gallon a year algal biofuel facility built and operational in Arizona.

With all the bad news we get on a daily basis about energy and the environment, I understand your skepticism and conservatism. But from evidence of success of numerous pilot projects, including one by Shell Oil in Hawaii, algal oil growth and extraction are hardly questionable or controversial. Sure, the devil is in the details, but is it really necessary to find the cloud in every silver lining?

The Scoot,

It's 15,000 gallons per acre-year according to that article. So my quick math gives 3.125 square miles. And that article was written in 2004, not taking into account the furious biofuel developments that have been taking place in the meantime. I wonder also if they were considering the use of power plant flue gases, which would make the process vastly more efficient.


Don't get me wrong, I really hope this works. Perhaps the big players like these guys and Shell will look at what GreenFuel, GreenShift, and the others are doing wrong, and somehow reduce production costs the order of magnitude needed to compete with petroleum.

My pessimism comes from an article I came across on The Oil Drum last year that had costs for algae oil at about $600 per barrel. I used to be a huge algae advocate, but with that article, I lost most of it.

Cervus, you're right, and I did some further checking, and Shell's project is a 2 year research project, and is only expected to yield 5,000-6,000 gallons per acre, so maybe 10 square miles is a better figure. But the first-generation anything is not what we should be looking at for determining ultimate feasibility.

Algal biofuels is one of those game-changing technologies that is just bound to have a huge impact. Unlike the hydrogen hype (in which that little detail of hydrogen production

seems to be totally ignored), there's nothing mysterious about photosynthesis.

And when you see players like Shell and PetroSun actually breaking ground on large-scale plants, you know things are moving along.

@ Cervus:

You should let PetroSun know about the article. Either they haven't seen it or they have some plan that involves selling 30M gallons at a loss of $10 each.

And at "the scoot." What is so big about 10 square miles? Your all upper case letters makes you sound like Austin Powers holding the world ransom for 1 million dollars. I think there are 10 square miles available on any side of the max-security prison in Coolidge.


color me a skeptic. unless i'm mistaken, PetroSun is a tiny, unprofitable micro-cap with a market capitalization of around $2 million. Where are they going to get the money for this project, assuming they have all the bugs worked out?

If there is a biofuel bubble, the hope is that we come out of it with a dozen good proven processes. The likelihood is that several different researchers/firms will get component processes right, and someone will come along and integrate/aggregate them into the process that makes us all go, "Doh, why didn't I think of that?!?"

That said, I don't buy much from the oil drum. Too many convenient or worst-case assumptions. Yes, Algal oil will not be profitable in open ponds. But, the notion of getting paid to consume flue gases, or livestock runoff, or sewage, or carbon otherwise in need of sequestering has a value. The notion of running the algae through flat plastic tubes across otherwise marginal or fallow lands lowers the cost and minimizes contamination. The idea of turning the left over starch into higher chain alcohol has value. The idea of turning the algal protein into animal feed has value.

The Salton Sea area in California is a great example of how this all comes together. This area has salt water, a problem with excess livestock runoff, lots of sun, and lots of marginal land, and yet it's close enough to the Los Angeles metroplex to have a ready market for all the coproducts.

This project is mostly just solar power by another name. It has economic value because it converts waste into a useful output. In the long-term, I like massive solar-thermal projects and electric cars (Silicon nanowires in Lithium ion batteries, anyone) better.

The reason for all upper caps is because while ten square miles of desert may seem like nothing to the average westerner, from my vantage point in the midwest, entire cities of thousands upon thousands of people are in areas that large.

Ten square miles is BIG. To traverse the perimeter would be to go forty miles (obviously, but I am trying to make a point).

Let's say Petrosun sets this farm up. Optimally, they will eventually be producing 2.5 million gallons of biodiesel a month. Let's say, for the sake of argument, the cost of diesel goes to $4.50 a gallon in 18 months.

That is a gross profit of $555,555.56 a month. How much is it going to cost to set this farm up, pay the employees, maintain the farm, deliver the biodiesel to market...

I am more than skeptical, here.


Farmer economics don't make sense to me either, but lots of farmers somehow get by with crops that only make them $300-$400 per acre, per season. They're lucky if they get 3 seasons. I guess the answer is, the land is dirt cheap and they work a lot of it.

For algae, we're talking about land with even fewer alternative uses.

The algae is harvested by regularly skimming, so it can be batch harvested, or continuously culled, depending on what made the most sense for drying/concentrating. Think of the processing as taking your crop of spinach to the cannery. The capital costs should be amortized over decades.

Are we talking 10 square miles, or 10 miles square?

10 square miles only has a perimeter of 12.6 miles, since it is just under 3.2 miles on a side.

10 miles, squared, would yield a perimeter of 40 miles.

I would hazard a guess that an average small farm or ranch easily exceeds 10 square miles.


10 sq. miles = 6400 Acres or 2590 Hectares.

It is not a very small farm unless you live in Texas.

However, (almost) useless desert land must be 10 000 times that much in USA and in many other places. Could a few coal power plants + algae biofuel colocated plants could be installed there?

6400 Acres, or 2590 hectares is not small, certainly. It's not a small farm or ranch, but I would guess is reasonable for business size farm or ranch. Industrial farming and ranch sizes must be much larger. As an example, the common center-pivot irrigation system (the circular crop fields you see flying over the US) can be up to ~600 acres. We're only talking about 10 of those. Is that too much land to use for 30 million gallons of fuel? What's the current ethanol output for 10 square miles of corn?

I think this is a very positive development. Hopefully, it's a sign of things to come.

Can we fix the italics?

Ah, that's better.

I wish these folks much luck.  This is certainly the sort of thing we need; biofuels from algae grown in open ponds means a fairly firm cap on the price of petroleum before it all gets displaced, and means we can produce things like renewable plastic.  Success means the doomsayers will have to fall back and regroup, always a fun thing to watch.

Well, the more corn you pull out of an acre, the more ethanol you can make from it. However, how much energy did you put into that acre, and how much did you pull out?

Right now, an acre of corn produces about 328 gallons of ethanol. That means that 6400 acres of corn can produce two million 100 thousand gallons of ethanol.

30 million gallons of biodiesel will produce 3,747,000,000 Megajoules.

Two million, 100 thousand gallons of ethanol... has less than that.

I still am HIGHLY skeptical.

30 million gallons per year is 0.002 million barrels per day. The question is can it be scaled up.

with a solar constant of 340W/m2, you have 10.7 GJ/year/m2
that means you need 35 hectares of land to receive the amount of sunlight energy equivalent to 3o million gallons.
If you use 26oo hectares, you have got energy efficiency around 15%. Thats about as much as a good solar plant can do.
But you need huge infratsructure investment (lots of transparent pipelines, water, S, N, P nutritients).
So I guess it is at or below the energy efficiency of solar power which is a clear loser to nuclear IMHO.

Lets see, lets assume we can get 15,000 barrels of oil from algae per acre per year. Now the US currently uses about 7,000,000,000 barrels of oil per year. So to replace 10% with algae oil, it would take less than 100 square miles, so the land required does not seem to be the problem.

So by the numbers, if we cut oil use from 7 gigabarrels to 4 gigabarrels by using PHEV's, and replace our falling domestic production with renewable sources such as algae, we could reduce our imports of foreign oil to about 2 gigabarrels per year.

Through out history, there has always been skeptics with anything new.


It's not 15,000 barrels per acre/year. It's 15,000 gallons as a theoretical maximum. Actual yields will much, much lower than that.

Aww, shucks guys, this announce is full o' holes. First the outfit states its forming a "joint venture." Okay with whom? The other venturer is never named! Oops. Second, this is a micro-cap corporation traded OTC at $0.15 a share and $0.00 reported market cap. Can we say Pump and dump?

Where we can be enthusiastic is about the Shell JV. At least there is real money there and a burgeoning technology. If you haven't looked at GreenFuel or Vertigrow lately check em out. The clear polyvinyl bags seem to be working.

For the guys over in Coolige, AZ operating out of a one room suite in Scottsdale penalizes believability.

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