Firm eyes potential for turning algae into fuel

A company working from a secret Nelson location is making groundbreaking advances producing biofuel from sewage pond algae and has already licensed its technology for most of Asia.

Entrepreneur Barrie Leay, a founding shareholder in Aquaflow Bionomics Corporation, said the business started out using algae from sewage ponds in Blenheim at the request of its mayor.

The operation is based in Nelson -largely to suit the 20 staff it now employs - and has since started working with the Tasman District Council and other territorial authorities to harvest their algae too.

"We are not advertising our location in Nelson as this is groundbreaking technology in which we are still in the process of filing our next batch of patents, for which security is paramount," Mr Leay said.

The company's website says it had no sooner moved into a suitable factory last year when it realised it didn't have enough space to accommodate its growing workforce and had to lease part of the next-door building as well.

In July 2007, a Singapore-based company called Pure Power Asia came on board as a 19.9 percent cornerstone shareholder, injecting $3 million into the company which started in 2005 with six founding shareholders.

Mr Leay said Aquaflow Bionomics was licensing its technology, its plant and the growing range of products it produces "as our knowledge and applications increase".

The potential was huge, he said.

"There is a great deal of interest from some very big players because they all realise now there's a future in biofuels. From our perspective, the opportunity once we're making sufficient biofuel is then to use it directly in vehicles or use it to power plants. It will replace mineral oils that were traditionally used."

The Government is introducing new regulations, forcing oil companies to sell a proportion of biofuels by July 1, starting at .53 percent and rising to 3.4 percent by 2012. Aquaflow Bionomics has been working with Boeing as it looks at non-fossil sources for jet-fuel.

Mr Leay said there was no need to be signing up customers on contracts because "everybody wants it".

"It's just so big. Even a small airline, you're talking about hundreds of thousands of gallons a day being consumed."

Nelson iwi Ngati Koata Trust last year announced its plans to launch a multimillion-dollar business making and then selling biodiesel to motorists, the fishing industry and manufacturers.

Trust chief executive Caron Paul said the trust had been busy doing other things but was now focusing on the new venture. Engineers were installing the equipment.

Asked when production would begin, she replied: "That's the million-dollar question. We have to have a few trial runs."

 POWER11

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