Long known for its poor environmental practices and denial of climate change, Exxon’s entry into the field of biofuels will be welcomed by some and viewed skeptically by others. For a company that made $45.22 billion last year, a $600 million investment could be seen as more of a PR investment than a scientific commitment.
Algae has become a popular choice for biofuels due to its high energy potential. Exxon thinks it can produce more than 2,000 gallons of fuel per acre of production each year. Compare this with corn ethanol, which yields only 250 gallons per acre a year and has significantly lower energy potential than the lipids produced by algae.
Furthermore, algae can be grown on land or brackish water that does not compete with food crops (perhaps even in salt water). Venter said he also believes that algae can be engineered to consume huge amounts of carbon dioxide when it's grown, offsetting carbon emissions from power plants.
For its part, Exxon warns that any large-scale commercial algae fuel plants are five to 10 years away, with numerous obstacles still to overcome.
It’s one thing to produce small amounts of fuel from algae, but this is not the scientists’ task. Rather, they must figure out a way to produce synthetic fuel that's cheaper than gasoline and can put some sort of dent in the 9 million barrels of gasoline the U.S. market consumes every day and the 138 billion gallons it eats each year.
Exxon to Invest Millions to Make Fuel From Algae (New York Times)