July 16, 08
HR Biopetroleum set to Produce Biodiesel from Microalgae in Hawaiii

A Honolulu-based renewable energy company announced plans Tuesday to build a microalgae-production plant on Maui with the aim of selling biodiesel to Maui Electric Co.

HR Biopetroleum, a 3-year-old research and development company focused on converting algal oil to biodiesel, expects to open the plant in 2011.

The cleaner-burning fuel can be used to run cars, planes and power plants.

The Maui project includes an agreement with Honolulu-based Alexander & Baldwin Inc. to provide land adjacent to Maui Electric Co.'s waterfront power plant in Maalaea.

Ed Shonsey, HR Biopetroleum's CEO, told PBN the company expects to receive around 1,000 acres of land, and that it will likely use about 750 of those acres for algae production.

Algae can typically produce 10,000 to 15,000 gallons of oil per acre per year, meaning the facility could produce between 7.5 million and 11.25 million gallons of oil annually.

By comparison, the next best crop, palm, yields 600 gallons per acre per year, he said.

Financial details were not disclosed, but Shonsey said the company is confident the facility can be profitable in its first year of operations.

"The challenging items, as it should be, will be obtaining all of the environmental approvals and approvals from the [state] Public Utilities Commission, which usually takes two to three years," Shonsey said.

The Maui project also involves partnering with Maui Electric Co. to handle permitting and building of piping to supply the algae facility with about 10 percent of its carbon dioxide emissions, which algae thrives on.

The Maui plant will be HR Biopetroleum's first commercial facility.

Late last year, HR Biopetroleum agreed to a multimillion-dollar deal with oil industry giant Royal Dutch Shell to head a two-year demonstration project that will grow six acres of algae on the Big Island.

That facility is expected to be completed by the end of this year at the Natural Energy Laboratory of Hawaii Authority in Kona.

"We'll no longer just be doing discovery research, but we'll have the opportunity to scale up what we're doing at NELHA with the pilot facility," Shonsey said.