Amyris, ETH Bioenergia to Make Fuel Precursor in Brazil

Amyris Inc. (AMRS), a U.S. biotechnology company, formed a joint venture with ETH Bioenergia SA to process sugar cane into a raw material for fuel, its sixth such agreement in Brazil.

The venture will start producing farnesene, a chemical that can be transformed into fuel, in 2014, Emeryville, California- based Amyris said today in a statement. It will have access to an ETH Bioenergia mill that can process up to 2 million tons of cane annually for the venture.

More Brazilian sugar-cane mills have started selling energy to the national grid in recent years to reduce their dependence on the sugar and ethanol markets. Selling farnesene, Amyris’s 15-carbon specialty chemical that can also be transformed into lubricants, would protect revenue further.

“We’re attractive to mills because we can help them diversify and expand the portfolio of products they offer,” Joel Velasco, Amyris’ senior vice president of external relations, said in a telephone interview today.

ETH Bioenergia, which is based in Sao Paulo and controlled by engineering and construction company Odebrecht SA, is focusing on ethanol production, he said. Prices for sugar have gained 133 percent to about 27 cents a pound during the past 36 months, according to data compiled by Bloomberg.

15 Million Tons

Amyris operates a small farnesene production plant in Sao Paulo state and is building facilities at mills owned by Sao Martinho SA (SMTO3) and Paraiso Bioenergia SA that will enable it to process up to 3 million tons of cane, he said.

The company has formed agreements with Cosan Ltd. (CZZ), Bunge Ltd. (BG) and Guarani SA and will have access to about 15 million tons of cane-crushing capacity by 2015, he said.

Amyris plans to produce as much as 50 million liters (13.2 million gallons) of farnesene next year from facilities around the world, he said.

“We don’t just make fuel for the car from it, but the tires and the dashboard,” he said.

To contact the reporter on this story: Stephan Nielsen in Sao Paulo at snielsen8@bloomberg.net

To contact the editor responsible for this story: Will Wade at wwade4@bloomberg.net

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