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Energy

Exxon (XOM): Fuel From Algae

Photo of Douglas A. McIntyre
By Douglas A. McIntyre Updated Published
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One piece of news no one ever expected to hear is that Exxon (XOM) will put $600 million into a project that seeks to convert algae into liquid fuel for transportation. The huge oil company says that any commercial success of the project is five to ten years off, but Exxon has to be concerned that, at some point in the next several decades, the amount of fossil fuel in the ground and under the oceans will begin to drop.

According toThe New York Times, the biofuel investment will be done in partnership with Synthetic Genomics, a leader in the field of research and production of renewable energy. The paper says that “according to Exxon, algae could yield more than 2,000 gallons of fuel per acre of production each year.” That compares to only 250 gallons from corn.

The press and advocates of green energy are going to greet the Exxon move with substantial skepticism. The company could be hedging a bet on its own future by leading the way in converting plant-based raw material into liquid to power cars and other machines with internal combustion engines. On the other hand, it may be using the announcement as a public relations ploy to get alternative energy advocates off of its back. The $600 million investment is a lot of money for most corporations, but it is not for Exxon.

One positive result that will come from Exxon’s actions is that research and production of biofuels will be advanced, whether the oil company ever plans to use it or not.

Douglas A. McIntyre

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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