50 Hottest Companies in Bioenergy: #9, Verenium

Verenium Corporation
Based in: Massachusetts
2009-2010 ranking: 9

Annual Revenues 2009 (projected), 2008, 2007 (in millions):
•    FY 2007 – $46,273
•    FY 2008 – $69,659
•    FY 2009 – Verenium will not be providing 2009 guidance at this time.

Technology type:
Fermentation, biochemical pathways

Fuel type:
Cellulosic Ethanol, a renewable fuel source produced from natural, non-food feedstocks, such as sugarcane bagasse, dedicated energy crops and wood products.  Cellulose, a long-chain polysaccharide found in nearly all plant life, is the most abundant organic compound on earth.  The Environmental Protection Agency says cellulosic ethanol’s high-oxygen content reduces carbon monoxide better than other oxygenates.

Major Investors:
•    AWM Investment Company Inc.
•    Syngenta AG
•    HealthCare Ventures LLC

3 top milestones for 2008-2009:
•    Verenium begins commissioning nation’s first-of-its kind cellulosic ethanol demonstration plant in Jennings, Louisiana;
•    Verenium announces plans to build first commercial cellulosic ethanol plant in Highlands County, Florida, with a target capacity of up to 36 million gallons per year (MGY);
•    British Petroleum (BP) and Verenium form 50-50 joint venture (JV) to develop and commercialize cellulosic ethanol from nonfood feedstocks in the United States; JV now operates under the name Vercipia Biofuels

3 major milestone goals for 2010-2011:
•    Secure financing for first commercial-scale cellulosic ethanol facility in Highlands County, Florida;
•    Leverage R&D capabilities and enhance cellulosic ethanol capabilities;
•    Pursue strategic partnership opportunities for the Specialty Enzyme Business Unit

Business model::
•    The key elements of V’s  corporate strategy are to develop integrated solutions for the emerging cellulosic ethanol industry for use in production facilities that we own and operate, individually or jointly with partners, as well as those of third-party licensees.  We intend to use our leadership position to develop novel, high-performance enzymes and to advance our technology and process development capabilities, together with BP, at our pilot and demonstration-scale plants in Jennings, Louisiana, and our first planned commercial facility in Highlands County, Florida, to exploit opportunities in the developing market for the production of cellulosic ethanol.  We have established our business model based upon the belief that owning and managing cellulosic ethanol production facilities in conjunction with strategic partners, including BP, will allow us to create economic value by incorporating our scientific and engineering skills into the production facilities.  Through our joint venture with BP, we may also license our proprietary technology to extend our commercial reach and accelerate our market penetration.
•    Establish a sustainable, high-growth, profitable specialty enzymes business.  Our specialty enzyme products and product candidates target high-value applications where we believe our enzyme discovery and optimization technologies can deliver superior, proprietary solutions.  We believe our combination of independent and partnered products is positioned to generate substantial product revenues at attractive gross profit margins.  In 2008, we generated approximately $49 million in such revenues, an increase of nearly 90% over 2007.  We hope to achieve increased product sales and profit margins to support the future growth and profitability of our portfolio of products sold directly by us and by our partners.

Fuel cost
•    Our goal from a cost standpoint is to be producing ethanol that is competitive with today’s grain ethanol (~$2/gal).

Competitive edge:

•    Verenium is the first publicly traded, fully-integrated, next-generation biofuel company, and its range of expertise and resources greatly enhances its potential for success.  Verenium is mastering the entire cellulosic ethanol production process as the first and only company with the full range of “field-to-pump” capabilities.  This includes: growing energy crops, developing enzymes, processing biomass into fuel and, ultimately, selling it.  Additionally, Verenium’s partnerships, which range from industry giants like BP and Syngenta to the U.S. Department of Energy (DOE), make the company uniquely positioned for success.

• Verenium has more than 250 issued patents and more than 350 patent applications, as of March 12, 2009.

•    Verenium’s technology enables conversion of nearly all of the sugars found in cellulosic biomass, including both five-carbon sugars and six-carbon sugars, into ethanol.  This efficiency advantage, combined with low-input cost of cellulosic biomass, results in superior economics in the production of ethanol.

Distribution, research, marketing or production partnerships or alliances:

Alfa Laval (enzyme collaboration), BASF(enzyme collaboration), BP (commercialization of cellulosic ethanol), Bunge (enzyme discovery and development), Cargill (enzyme discovery and development), Danisco (enzyme discovery and development), DOE (cellulosic ethanol fermentation technology, enzyme development for breaking down biomass), Fermic (manufacturing of enzymes), Lykes Bros. (agribusiness), Marubeni Corporation (licensee), Scion (enzyme collaboration), Syngenta (enzyme cocktail collaboration),Tsukishima Kikai Co. Ltd. (construction of Osaka plant), University of Florida (fermentation organisms).

Development stage:

Verenium currently operates an integrated cellulosic ethanol pilot facility in Jennings, Louisiana.  This plant is used to broaden the company’s capabilities in advanced fermentation and to test a range of feedstocks for conversion into cellulosic ethanol.  The pilot plant also serves as a real-time research and development facility to develop new enzyme cocktails for optimizing the production of cellulosic ethanol.  Additionally, Verenium has fully commissioned its 1.4 MGY demonstration-scale facility, also located at its Jennings site, representing the first of its kind in the nation.  Verenium’s process technology has also been licensed to Tokyo-based Marubeni Corporation and Tsukishima Kikai Co., Ltd. and incorporated into their 1.4 million liter-per-year cellulosic ethanol plant in Osaka, Japan – utilizing construction and demolition wood waste as a feedstock.

Vercipia Biofuels, the 50-50 JV company between BP and Verenium, intends to break ground on one of the nation’s first commercial-scale cellulosic ethanol facilities in Highlands County, Florida, in 2010.  This 36 MGY facility is expected to begin commercial production in 2012.  Vercipia anticipates developing additional commercial facilities in the Gulf Coast region and expects to announce the location of its second plant in the coming year.

50 Hottest Companies in Bioenergy: #9, Verenium is a post from: Biofuels Digest