Well-known but still young biofuel company Sapphire Energy has more than doubled its funding to more than $100 million for its “green crude,” a fuel it says will mimic the best characteristics of the oil we drill for today.
Sapphire’s plan, which I covered in depth back in May, is to grow tailored strains of algae on waste water. Algae is criticized because it often uses open pools of water, which evaporate quickly in hot climes, wasting a precious resource. So Sapphire will genetically modify algae to subsist on water that is useless to humans.
But few new details have come out since Sapphire emerged in May. Developing a process like Sapphire’s takes a long time, and the company estimates that it will need three to five years to reach 10,000 barrels a day of production — a nice revenue line for a startup, but a relatively tiny amount of fuel. And problems with the algae can occur at any point in that time window, delaying or halting progress.
If Sapphire is successful, it make a substance it calls “green crude,” which can be run through existing oil refineries to produce gasoline, jet fuel and other petroleum derivatives. Most algal biofuel startups, like Greenfuel and SequesCO, plan to make biodiesel, which is roughly the same as today’s diesel fuel.
One confusing point about Sapphire’s growing funding is that the company is unwilling to break down the numbers. It says it has raised “substantially more than” $100 million, and in May said it had taken $50 million. So its funding has at least doubled since then. However, reports that it has taken a $50 million second round may be inaccurate.
The new investor in this round, officially the second, is Cascade Investment, which is owned by Bill Gates. The other investors are ARCH Venture Partners, Wellcome Trust and Venrock. Sapphire is based in San Diego, Calif.