We recently looked at the infrastructure supporting operations at the 100,000 metric ton per year facility in Moema, Brazil, owned by renewable oils and bioproducts manufacturer Solazyme (TVIA) and feedstock producer Bunge (BG 2.83%). It's a good idea for investors to familiarize themselves with the equipment at Moema to understand exactly what goes on behind the scenes, to debunk any misconceptions, and to have background knowledge to lean on when management discusses the facility in the future. Besides, contrary to popular belief, the equipment and its importance can be understood by any investor.

In part two of the four-part series we'll dig into the upstream category of equipment, as presented in Solazyme's presentations to keep things simple. This equipment is probably the least obvious within the facility, but serves a critical role in supporting the operations of the fermentation tanks and keeping the facility in compliance with internal quality standards and local, state, and federal environmental standards.

Source: Solazyme.

Science doesn't stop at commercial scale

While strain development occurs in the labs and pilot facilities in South San Francisco, the need for wet labs and bench space doesn't vanish at a commercial-scale facility. Solazyme still needs lab space at Moema for quality control measures to ensure production strains are producing at their designed specification. Once it's determined that microbes work as designed they're transferred to the seed train (discussed in part three: fermentation) before making it to the commercial fermentation tanks for creating product. Scientists and engineers will check microbes prior to and during full-scale operations at 625,000 liters by sampling the commercial fermentation tanks at regular intervals during each batch. 

If, for whatever reason, the microbes aren't growing as they should or producing the expected products in the correct distribution during a commercial batch, then engineers will have actionable data in hand to correct the problem. The same holds true for determining the sources contributing to unexpected changes in pH, dissolved oxygen content, or an unexpected product altogether. Expected data for each batch is equally useful, however, and is stored on site with the batch number. In the event a product is recalled, Solazyme, Bunge, or a customer can look at the data to pinpoint the problem batch or batches -- limiting the monetary repercussions of the recall.

Quality and environmental standards
Solazyme needs the ability to quantitatively demonstrate that sterilization equipment (discussed in part one: infrastructure) is working as designed, which is where compliance monitoring systems come into play. There's no point in sterilizing incoming sugarcane syrup, supporting nutrients, water, or air if potential contaminants are still lurking when it gets sent to the fermentation tanks. And although it isn't technically "upstream," monitoring what goes out of the facility (external compliance) is just as important as monitoring what comes in (internal compliance).

What good would it be to champion the drastic reduction in land use for producing renewable algal oils compared to agricultural oils if Solazyme dumped its waste into the environment? Sustainability extends beyond the sourcing of raw materials. Thus, everything discharged from the facility must meet strict environmental requirements to reduce the risk of biologic and nonorganic contaminants escaping into the surrounding area. That includes wastewater, liquid waste from fermentation tanks, gaseous emissions, and solid waste. Luckily, streams discharged from the sterilization equipment and standard wastewater treatment equipment are closely checked by various compliance monitoring systems throughout the facility.

Foolish takeaway
Solazyme states that all of its supporting infrastructure and upstream equipment are online at Moema. It may not be obvious from reading through the company's presentations, and you may be tempted to skip right to the fermentation section of the graphic, but efficient and reliable upstream processes allow fermentation to occur in the first place. Similarly, ensuring waste streams are in compliance with federal, state, and local environmental standards keeps a facility from being fined or even shut down. In part three, we'll take a look at the fermentation equipment at Moema.