Algae.Tec, Lufthansa team up on algae-to-fuel plant in Europe
Sep 19, 2012 - Australian firm Algae.Tec Ltd (ASX:AEB) on Tuesday said it had formed a partnership with Germany's Lufthansa (ETR:LHA) to build a facility that produces crude oil from algae in Europe.
Aviation group Lufthansa will secure 100% of the funds for the large-scale facility, while Algae.Tec, which will manage the project, will receive licence fees and profits. The plant will use Algae.Tec's enclosed modular technology, which captures carbon dioxide waste from power plants and factories and feeds it into an algae growth system.
Under the collaboration agreement between the two companies, Lufthansa is to buy at least 50% of the produced crude oil at a specified priced.
The agreement follows a memorandum of understanding inked between the two companies in January. This marks the beginning of a long-term cooperation between the two parties for the industrial production of algae oil that can be converted into aviation kerosene and conventional diesel fuels. The partnership needs final approval from the boards of Algae.Tec and Lufthansa and the final sign off for the conversion of algae oil into aviation kerosene.