Amyris, Inc. (NASDAQ: AMRS) and Cosan SA Industria e Comércio (Bovespa: CSAN3) announced today that they have executed a binding agreement to establish a joint venture for the worldwide development, production and commercialization of renewable base oils.
The parties announced that they had entered into a term sheet for this joint venture in June 2010. Initially, the joint venture would source farnesene from other Amyris production facilities, and the parties would share the marketing and operating costs.
Base oils are the building blocks of lubricant oils, currently derived from a mixture of fractions from the crude oil refining process. Manufacturers then mix additives with base oils to impart desirable properties to meet certain performance conditions, creating a range of lubricants including engine oils, gear oils, hydraulic oils and turbine oils.
By applying Amyris’s synthetic biology platform to modify yeast to produce targeted hydrocarbon molecules, the joint venture will be able to create base oils from plant sugar sources. The Cosan/Amyris joint venture plans to use sugarcane as a feedstock in a standard fermentation process in which Amyris’s modified yeast converts the cane syrup to farnesene (Biofene™).
Biofene is then finished chemically to create high-end base oils. These base oils are designed to reduce smoke and odor and also reduce greenhouse gas emissions by over 80% compared with petroleum-sourced base oils. In addition, they are biodegradable, perform well in cold weather and have high-performance viscosity properties, the companies said.
"We believe this joint venture will strengthen our overall business by bringing new and high performance renewable products to our portfolio," said Marcos Lutz, CEO of Cosan. “Amyris’s technology can greatly expand the range and value of products that we can derive from sugarcane and improve Cosan’s portfolio outside of the Cosan/Shell joint venture.”
Amyris has proved to be a strong green investment since debuting on the Nasdaq in September.
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