Posted May 11, 2010

OriginOil Inc. announced on May 10 that MBD Energy Limited has become the company's first algae-producing customer. Anglo American, one of the world's largest mining companies, is a cornerstone investor in MBD Energy.

The parties recently signed a Memorandum of Understanding on a multi-phase commercialization program under which OriginOil will supply MBD Energy, an Australia-based company, with its trademarked Quantum Fracturing and Single-Step Extraction systems. Andrew Lawson, Managing Director of MBD Energy, said: "We are delighted to become OriginOil's first major customer and we look forward to working with the OriginOil team to forge a comprehensive commercial relationship with game-changing potential in the exciting third-generation biofuels space."

Three of Australia's largest coal-fired power generators have committed to building test facilities adjacent to their power stations using MBD's proprietary growth system, the Algae Synthesizer, where smoke-stack CO2 emissions are captured and used to grow oil-rich algae in solar bioreactors. This process effectively achieves BIO-CCS (Carbon Capture and Storage). In the full production systems, OriginOil's technology will be integrated into the MBD system to enhance algae growth and perform oil extraction.

In the initial phase, OriginOil will equip MBD Energy's research and development facility at James Cook University in Queensland, Australia, where testing will take place. The two companies agreed that, subject to the success of the initial test phase, MBD will purchase significantly larger feeding and OriginOil extraction units to serve facilities planned for its three Algal Synthesizer power station projects in Australia: Tarong Energy (Queensland), Loy Yang A (Victoria) and Eraring Energy (New South Wales).

Riggs Eckelberry, OriginOil CEO said, "We have been looking for a partner with the resources and scaling capabilities to rapidly industrialize algae production with a focus on the long-term development of our industry. We are delighted to have found this partner in MBD Energy." He added, "Many thanks go to MBD's Larry Sirmans and Enrico Bombardieri, and our own Dr. Pattarkine, for their vision and persistence in making this partnership possible."

Queensland Premier Anna Bligh officially opened MBD's expanded R&D facility in November 2009. Premier Bligh said: "The revolutionary algal carbon capture and storage (BIO-CCS) technology is already proving successful in trials and will soon be rolled out at three coal fired power stations, including Tarong Power Station near Kingaroy. This technology has the potential to revolutionize carbon capture in Queensland and around the world." She added: "As our state continues to grow and coal remains a key export, it is essential that we devise new ways to manage the impact of that growth on our environment."

The Queensland Premier also announced that MBD would shortly commence construction of a one-hectare pilot plant at South Eastern Queensland's Tarong Power Station. The trial aims to capture 700 tonnes of carbon dioxide annually and, if successful, could expand over the next five to 10 years to consume more than half of Tarong's problem flue-gas emissions.

MBD's Andrew Lawson said that each of the three current MBD power station projects has the potential to then grow to 80-hectare commercial plants, each capable of producing 11 million liters of oil for plastics and transport fuel, and 25,000 tonnes of drought-proof animal feed annually. He said that the projects will eventually consume more than half of each of the power station's problem flue-gas emissions.

OriginOil's Quantum Fracturing System breaks down nutrients such as CO2 into micro-particles that stay suspended in water longer, allowing algae to feed more efficiently. The Single-Step Extraction system is the first commercial "wet" extraction system, able to separate algae oil from its biomass without costly and energy-intensive dewatering operations.

SOURCE: ORIGINOIL