It isn't big, but at least it's a start.
According to an Exxon official involved in the project, "the real challenge to creating a viable next generation biofuel is the ability to produce it in large volumes." In addition to being suitable for such high-volume production, algae can be grown in places that are inappropriate for other crops. At the same time, it also consumes greenhouse gases, thereby reducing the likelihood of climate change. Also, algae-based oil approximates the molecular structure of conventional petroleum products, such that Exxon can create fuels from the algae at its existing refineries.
In announcing their venture, officials of the companies were careful to emphasize that the project will not come to fruition overnight. As Exxon senior vice president Michael Dolan noted, "significant work and years of research and development still must be completed." Exxon's Emil Jacobs also identified the key steps that lie ahead in the project:
- identifying suitable low-cost algae strains
- deciding upon the optimum way to grow the algae
- determining the best methods for harvesting the algae
Beyond ExxonMobil's joint venture, several other major energy and chemicals companies are active in the development of biofuels. For instance, Royal Dutch Shell
In addition, only a couple of weeks ago Dow Chemical
Exxon's energy efficiency efforts don't stop with biofuels. Last month the company announced a program to foster a fleet of electric vehicles powered by Exxon’s new lithium ion battery in Baltimore. So let the critics wail. I, for one, am convinced that ExxonMobil is a tough company to beat.
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Fool contributor David Lee Smith doesn't own shares in any of the companies mentioned above. He does, however, welcome your questions or comments. The Fool has a constantly renewable disclosure policy.