Verenium enters Landmark Agreement with BP

Like most small caps, the stock price of Verenium Corporation (profiled here on May 21, 2008) has languished with the stock market since the SI Blog expanded coverage to cover promising companies outside the sirtuin space with the elimination of Sirtris Pharmacueticals as a public company. Today however, Verenium Corporation, followed in the steps of Sirtris by announcing a landmark agreement with an industry leader. In this case it was British Petroleum. Unlike Sirtris, however, Verenium management, which owns an astounding 54.67% of the company, decided that the upside was too promising to sell the entire company to BP. The deal calls for the establishment of a joint venture to commercialize celluslosic ethanol and it includes $90,000,000 of financing from BP over the next 18 months

One major catalyst for this agreement is certainly recently passed legislation that mandates 21 billion gallons of advanced biofuel production by 2022, of which 16 billion gallons must come from cellulosic ethanol. That's one hell of a mandate considering that the cellulosic ethanol industry doesn't really exist right now. Any company that can take advantage of this legislation will have a very lucrative business. More importantly, that company will help us move forward towards true energy independence. Cellulosic ethanol has five principal advantages over much criticized, and rightfully so, corn based ethanol:

1. it uses non-food crops
2. it uses relatively low-cost feedstock
3. it uses marginal lands for feedstock growth
4. it has a beneficial net energy balance
5. it uses less fertilizer and water.


Verenium is a leader in this field and is currently optimizing the nation’s first true demonstration-scale plant capable of producing ethanol from non-food cellulosic biomass sources.

Do your own due diligence and remember, if you visit this blog primarily as a resveratrol user....immortality is expensive.