Exxon Mobil Corp. (XOM) is spending $600 million on developing biofuels for motor vehicles from algae, but the company says success is still a quarter of a century away.
Over three years into a joint venture with Synthetic Genomics Inc., Exxon says the technology just isn't there yet for algae-based fuels, though it had originally predicted it was only a decade away from producing these fuels.
So far, the JV has been unable to come up with a way to produce enough raw material from algae to supply a refinery, Exxon Mobil CEO Rex Tillerson told PBS television, as reported by Bloomberg.
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"We've come to understand some limits of that technology, or limits as we understand it today, which doesn't mean it's limited forever," Tillerson said. The venture is "probably further" than 25 years away from successfully developing fuels.
Despite this, a new survey of the algae industry conducted by the Algae Biomass Organization (ABO) shows the industry expects increasing production in 2013 and price-competitiveness with fossil fuels by 2020.
According to the survey of more than 470 algae industry contacts, the sector continues to grow: "67 percent of algae producers said they plan to expand capacity in 2013 as they work to provide the US with new sources of sustainable, domestically produced fuels and other algae-derived products.
By. Charles Kennedy of Oilprice.com
Charles is a writer for Oilprice.com More