Double Home Run on SuccessLEC is a leading technology company in theadvanced biofuels and renewable chemicals sector.
Today announcement that it has recentlycompleted a major body of work with Novozymes in producing cellulosicethanol at Lignol's pilot-scale biorefinery may be transformational.
Lignol and Novozymes had previously announced a joint research anddevelopment agreement to make biofuel from wood chips and forestrywaste with the aim of producing biofuel (cellulosic ethanol) at production costs competitive with gasoline and corn ethanol.
The first phase of the project, which included producing cellulosic ethanol fromhardwood at Lignol's pilot-scale biorefinery, has been successfullycompleted.
These joint efforts have resulted in the achievement of interim targets, establishing baseline production costs for the next phase of the project which will focus on enzyme and substrateoptimization with the objective of achieving the overall cost reductiontargets.
Over the coming months work will continue with the objective of further reducing the cost of producing cellulosic ethanol from hardwoods and laying the foundation for large scale commercialdeployment .
What distinguishes LEC's efforts to produce ethanol is that its business model is the reverse of the standard model.
LEC objective is to make ethanol the byproduct of an industrial process that focuses on the cultivation of a market for the natural glue, lignin, that wood pulp also contains.
The plan is technically challenging but straightforward: find commercial applications for lignin and you will defray the prohibitive costs of making ethanol from wood pulp, or cellulose.
The conversion of plant material into ethanol is nothing special, but it is much cheaper and faster to use grain as the feedstock to form the sugars that can be transformed into alcohol.
If LEC is successful...........and at this stage it does look good.......then their patented process will be able to make cheap ethanol from wood pulp while also selling the recovered lignin which will bring its ethanol costs down to levels comparable to comventional gasoline and diesal.
LEC has a very strong technical team and had a working capitlal of about $10.5 million (
.20 per share ) at the end of the last quarter.
Success here means a double home run...