Royal Dutch Shell has announced that it will work with HR Biopetroleum to build a pilot facility for growing algae as a source of biofuels. The facility will cultivate algae in seawater ponds, then harvest the algae and extract oil from them for conversion into fuels such as biodiesel. Construction of the facility will begin immediately on a parcel of land leased from the Natural Energy Laboratory of Hawaii Authority (NELHA), which is located on the shore of the Hawaiian island of Kona. The NELHA site is ideal for the project because it pipes in a constant supply of clean, fresh ocean water. NELHA was originally built to support a DOE project for ocean thermal energy conversion, and it continues to employ the project's seawater supply pipes to support a variety of research projects and commercial enterprises, including facilities that currently grow and harvest algae for pharmaceuticals and nutritional supplements. Shell and HR Biopetroleum have formed a joint venture company, called Cellana, to develop the biofuels project.

Algae grow rapidly and can have a high percentage of lipids, or oils. They can double their mass several times a day and produce at least 15 times more oil per acre than alternatives such as rapeseed, palms, soybeans, or jatropha. Moreover, algae-growing facilities can be built on coastal land unsuitable for conventional agriculture. The Cellana facility will grow only non-genetically modified, marine microalgae species in open-air ponds using proprietary technology. It will also use bottled carbon dioxide to test the algae's ability to capture carbon. To support the facility, academic research programs at the University of Hawaii, the University of Southern Mississippi, and Canada's Dalhousie University will screen natural microalgae species to find the strains that produce the highest yields and the most oil. See the Shell press release and the NELHA Web site.

Shell isn't the only oil company that's exploring the potential of algae. In late October, Chevron Corporation and DOE's National Renewable Energy Laboratory (NREL) announced that they had entered into a collaborative research and development agreement to produce biofuels from algae. Under the agreement, Chevron and NREL scientists will collaborate to identify and develop algae strains that can be economically harvested and processed into transportation fuels such as jet fuel.