U.S. biodiesel research company GreenFuel Technologies has licensed its process to produce biodiesel from algae to South African company De Beers Fuel fully two years before it will be ready for commercial application. That's not really so bad if De Beers want to be out in front and are willing to take a gamble on commercially unproven technology themselves.

However, De Beers has already on-sold 27 franchises based on the technology along with 40 million shares to the public without even issuing a prospectus. At R6 million (US$842,000), the franchises don't come cheap and De Beers now has a backlog of 90 reactors that have been ordered based on guarantees that each will be capable of producing 38.4 million L / 10.1 million gallons of biodiesel per year

De Beers Fuel defends their enthusiastic resale of the technology saying that GreenFuel have conducted a trial run at the Redhawk Power Station in Arizona, plus the De Beers plants will be run on traditional oilseed feedstocks before swapping them over to algae oil within two years.

Analysis: GreenFuel's algae technology looks very promising but this is a dangerous game De Beers Fuel is playing. If it all comes unstuck it could seriously dent the credibility of the algae biodiesel industry which I'd hate to see. At the same time, I think the gold rush mentality of the investors who appear to be betting the farm on a technology that has barely made it out of the lab is sure to catch up with them.

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[Source: Fin24.co.za via Oilgae]

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