Asia, with its rapidly growing number of car owners and large pollution problems, could very well be the biggest market for biofuels and green chemicals one day. Illinois-based LanzaTech, which announced Monday it has raised a $55.8 million round, is certainly finding more willing customers and partners Asia.
The Malaysian Life Sciences Capital Fund, formed by the Malaysian government and Burrill & Co., led the Series C funding round. Other investors included Malaysian’s national oil company, PETRONAS, and Malaysian engineering firm Dialog Group. The company has raised just over $85 million and counts Khosla Ventures and Qiming Venture Partners as investors as well.
The money will enable LanzaTech to continue developing processes for converting the carbon monoxide from waste gas from industrial operations and other sources into biofuels and chemicals. The company, founded in 2005, originally hailed from New Zealand and uses microbes and fermentation to produce products.
The startup is building demonstration projects and targeting China, which has become the largest car market and whose government has been promoting policies to promote cars that run on alternative fuels. LanzaTech is already working with two steel manufacturers – Baosteel and Capital Steel — to turn waste gas from their operations into ethanol. LanzaTech said it has installed equipment for a demonstration plant at Baosteel and plans to start production later this year. Last November, the biofuel company also announced a plan to work with a large Chinese coal producer – Yankuang Group — to produce fuels and chemicals from synthesis gas produced by Yankuang’s gasification equipment.
LanzaTech also is working on similar projects in India, where it has teamed up with Indian Oil and Jindal Power and Steel to produce ethanol. In addition, it’s working with Concord Blue to turn municipal solid waste into ethanol in India, LanzaTech said.
The biofuel company added a project in the U.S. recently when it bought a biofinery plant from the ill-fated Range Fuels during a liquidation sale earlier this month. Range Fuels, also a Khosla Venture-backed company, built the plant in 2010 to produce ethanol from wood chips but closed it in 2011 after it ran into trouble with its production process and needed more money to continue. LanzaTech told Bloomberg it plans to use the Georgia plant to develop a process for converting biomass into chemicals. The company has named the Georgia plant the Freedom Pines Biorefinery.
Photo courtesy of PETRONAS