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By Robert Rapier on Feb 17, 2010 with 7 responses

Algal Oil for $2 a Gallon?

By now I have had at least a dozen people send me the link or ask me to comment on the recent DARPA announcement that they can produce algal oil for $2 a gallon. My fellow blogger Lou Grinzo has already made a few comments, and I share his skepticism. It is an extraordinary claim, to me ranking up there with “We have invented time travel.” Then again, if you invented the Internet, I suppose people tend to cut you a lot of slack.

But it is true that extraordinary claims require extraordinary evidence, and in this case I find the latter to be lacking. First, the claim:

US military to make jet fuel from algae

Scientists at the Defense Advanced Research Projects Agency (DARPA) have already successfully extracted oil from algal ponds, and is now about to begin large-scale refining of the oil.

My son and I successfully extracted oil from algae as part of his 8th grade science project. Extracting oil is not particularly technically challenging. But here is where it gets interesting:

Special assistant for energy with DARPA, Barbara McQuiston, said unrefined oil produced from algae currently costs $2 per gallon, but the cost is projected to reduce to around $1. The refined and processed jet fuel is expected to cost under $3 per gallon.

My friend John Benemann once said to me that whenever people make claims like this, offer to buy all of the oil they have to sell. What you quickly find out is that they have no oil to sell. So that would be my question to Barbara McQuiston. If you can produce it for $2 a gallon, would you sign a contract to deliver it to me in volume for $3 a gallon? I suspect I already know the answer to that. It’s like the guy whose sign advertises the cheapest gasoline in town, but when you stop in his tanks are empty.

Perhaps McQuiston was misquoted. But anyone who has ever done a major project knows that unless construction is well underway, the claimed time schedule is completely unrealistic:

The refining operation would produce 50 million gallons of oil derived from algae each year and is expected to begin full-scale operations in 2011. Each acre of algal farm pond can produce 1,000 gallons of oil. The projects are run by private companies General Atomics and SAIC.

Digging a little deeper, I found this, which puts things in a bit more perspective:

SAIC Awarded $25 Million Contract by Defense Advanced Research Projects Agency

Under this contract, SAIC will lead a team of industrial and academic organizations to develop an integrated process for producing JP-8 from algae at a cost target of $3/gal. SAIC and its team will develop technologies and processes to help achieve DARPA’s goal including integrating algae strain selection, water and nutrient sourcing, farming, harvesting, separation, triglyceride purification, algal oil processing, and economic modeling and analysis.

Hmm. That refers to ambitious goals rather than targets that have actually been achieved.

SAIC’s work on the contract will happen in two phases. Phase 1 will concentrate on technology selection and development, pilot plant site analyses, system integration, and economic modeling and analysis, culminating in a lab-scale production capability, preliminary production facility design, and the delivery of samples for testing. SAIC will also develop detailed commercialization and qualification plans showing a path to commercial and military systems viability. Phase 2 will focus on the final design, integration and operation of a pre-pilot scale production facility.

Those statements – from 3 weeks ago – don’t mesh at all with the claims from McQuiston. In Phase 2 they will build a “pre-pilot” facility? How on earth then could they have any idea of how much it is going to cost them to produce the oil? 

No, I don’t believe they can produce algal oil for $2/gallon. I don’t believe anyone can, particularly if they are growing the algae in open ponds. I think back to my Interview with an Algae CEO, and his comment “Boy, you should see my electric bill.” The entire chain of algal oil production is energy and water intensive. So my suspicion is that McQuiston didn’t really mean that they can produce oil for that price. She may have stated that as a goal, and that got turned into a claim.

The other possibility is that because DARPA is a branch of the U.S. government, and government agencies need funding, maybe they are being a bit liberal with their claims in order to ensure funding.

I suspect that in a couple of years we will be doing the post-mortem on this one when we find that there is no $2 algal oil to be found anywhere.

  1. By Wendell Mercantile on February 19, 2010 at 1:49 pm

    Thanks Kit P.

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  2. By Isgota on February 22, 2010 at 11:56 am

    I had written a response about this topic in "theenergycollective.com" but it seems it´s lost in the cyberspace… I'll repeat the post here.

    ————————————

    As Durwood Dugged and you have pointed out:

    "most of the algae oil costs are energy costs in extraction, separation, drying and stabilization. It isn't probable that DARPA is any closer because of improbable cost differences between current research and what Mc Quiston is claiming for DARPA."

    But apparently DARPA has a new system that can reduce dramatically the costs, even has been stated as “potentially transformative innovation” by the DOE:

    Link 1
    Link 2

    There is a description of the harvesting system here.

    And even a video of the system working.

    What's your opinion? Could be this a key to a low cost algae oil?

    Best.

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  3. By Robert Rapier on February 22, 2010 at 1:26 pm

    What's your opinion? Could be this a key to a low cost algae oil?

    No. It's like hydrogen. There isn't one key, it will take multiple keys. The real problem is that algae exist in dilute form in water. To grow them, they water, nutrients, and constant circulation. To harvest – to get the algae on the belt shown in that video – takes filtration and lots of pumping. Once you have the algae, you have to extract the oil. Once you have the oil, you have to refine the oil. There are lots of costly steps.

    RR

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  4. By Isgota on February 22, 2010 at 6:47 pm

    To harvest – to get the algae on the belt shown in that video – takes filtration and lots of pumping.

    Actually, I think you don't need filtration and pumping at all to make that harvester works, only dip the belt in the raceway pond. That´s probably why they can go with so small energy consumption (If it works as advertised, obviously).

    Once you have the algae, you have to extract the oil. Once you have the oil, you have to refine the oil. There are lots of costly steps.

    Yes, but how is getting oil out of dried algae, refining and making FAMEs any different that what is been made from oil seeds right now? It has costs but doesn't seem to be the lion's share of the costs.

    Anyway, I agree with you that growing the algae in the desired way (high productivity and oil percentage on a cheap system)it would still be a key to get.

    Best.

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  5. By Robert Rapier on February 22, 2010 at 6:52 pm

    Actually, I think you don't need filtration and pumping at all to make that harvester works, only dip the belt in the raceway pond.

    I don't follow the logic of the system. The belt dipped in wet is going to bring out wet algae. That is not going to be a very efficient way to harvest, and then you either need long residence times (big, slow moving belts) or a press to dry it.

    Yes, but how is getting oil out of dried algae, refining and making FAMEs any different that what is been made from oil seeds right now?

    That industry's health is in jeopardy, though, as they are finding they can't compete minus the $1/gal subsidy. There is no way that algae is going to come close to the cost of oil from soybeans to start with.

    RR

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  6. By Isgota on February 22, 2010 at 8:40 pm

    My educated guess of how the system works is the main belt is dried by another belt by a combination of absorption and capillary actions, the red belt in this diagram. So, they claim you don't need to apply press to dry the algae (they say some waste heat is needed to get algae totally dry) what probably help separating the flakes from the main belt easily.

    They explain about the belts in this other video. Look at what happens when the put the absorbent paper below the plastic membrane that acts as main belt.

    An about the residence times, yes the belt looks slow, but they claim it can process 500 L/h at 3 g/L algae concentration, that's 1.5 Kg of algae per hour, not so bad for that little belt IMO.

    Best.

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  7. By interested on February 7, 2012 at 9:57 pm

    Anyone know the law about extracting algae oil and selling it?

    on a small scale not fuel/ algae oil. biofuels are air tight but what about selling just the algae oil?

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