By Robert Bradley Jr.
“After advertising its efforts to produce environmentally friendly fuels from algae for over a decade, Exxon Mobil Corp. is now quietly walking away from its most heavily publicized climate solution.” (below)
Biofuel is out, leaving carbon capture and storage (CCS) as the leave-us-alone, we-are-doing-our-part “greenwashing” strategy at ExxonMobil (see tomorrow’s post). The end of algae as a substitute for crude oil comes after $350 million and 14 years of commitment. This expenditure was joined by a “green” advertising campaign around the project of at least $60 million, mostly spent between 2017 and 2019.
It was predictable. Shell, BP, and Chevron had previously thrown in the biofuels towel. And it is reminiscent of Exxon’s failed ventures in the 1970s: Office equipment. Real estate. Synthetic fuels. Shale oil. Electric motors. Solar panels. Uranium. Copper.
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Here is the latest as reported by Ben Eligin and Kevin Crowley. “Exxon Retreats From Major Climate Effort to Make Biofuels From Algae” (Reuters: February 10, 2023) is subtitled “Renewable fuels made from algae was the company’s most heavily publicized climate solution.” The three shutdowns are reported in the article:
Exxon has slashed its support for Viridos Inc., a biotech company based in La Jolla, California, that operated as the oil giant’s key technical partner since it began its algae push in 2009. With Exxon funding drying up and difficulty finding other backers, the biotech firm laid off 60% of its staff on Dec. 27, according to Viridos executives. The biotech company said it is still moving forward with algae research.
Exxon, meanwhile, has also halted funding for a multi-million-dollar algae project at the Colorado School of Mines at the end of last year, after supporting the work for eight years. Another Exxon-backed venture with the National Renewable Energy Laboratory is set to end within weeks.
But the company’s new division, Low Carbon Solutions (think Exxon Enterprises of the 1970s), soldiers on with government subsidies in tow:
Exxon confirmed that it’s pulling back on funding for algae in favor of other technologies now being worked on by its Low Carbon Solutions division. “At this point we have other programs that are ready for deployment,” said Vijay Swarup, Exxon’s senior director of technology who ran algae research. “We need to get on the deployment curve for carbon capture, for hydrogen, for biofuels. Algae still needs some more work.”
“It’s a remarkable shift for Exxon,” Eligin and Crowley continue:
The allure of biofuels made from algae is that they would potentially generate less than half the emissions of petroleum. The production and use of Exxon’s oil and gas ultimately generates about 630 million tons of heat-trapping gases each year, nearly equal to the carbon footprint of Canada. The green goop has for years been prominently featured as a climate-friendly possibility in television ads and investor presentations.
Exxon is retreating from algae despite a smashing financial performance last year, in which it posted a record-breaking $59 billion in profits. And it comes just as the algae research has shown significant progress: Viridos and Exxon achieved significant improvements in recent years, including a seven-fold increase in the productivity of algae grown in outdoor ponds, according to Viridos Chief Executive Officer Oliver Fetzer.
Some questionable editorializing here. Strong profits are not a reason to engage in loss economics, particularly with a technology that has never been profitable and has open-ended grim economics. And “getting better” … isn’t that the perennial cry for more subsidies, more time?
Back to Eligin and Crowley:
Algae has long played an intriguing role at Exxon. The company, more than any other, has received criticism for being the most recalcitrant on climate change, becoming the subject of lawsuits, protests and years of political scrutiny over its long-term commitment to fossil fuels even as global warming gathers pace. As criticism poured in, Exxon frequently held up its algae efforts as one significant piece of evidence that it was serious about climate change and discovering cleaner forms of energy. “They’ve been trying to create the impression that they’re part of the solution, when they’re certainly not,” said Robert Brulle, a visiting professor at Brown University who has studied the promotional activities of the fossil fuels industry.
ExxonMobil executives tried to appease their enemies, and this is what they get? It was all laid out by one Steve Milloy, who has actively urged the company’s executives not to try to appease their enemies but to stand proud for what they believe in: oil and gas for the masses. [1]
Eligin and Crowley end:
In an interview, Exxon officials rejected the suggestion that algae was some sort of greenwashing attempt. “The progress we’ve made to this point is remarkable,” Swarup said, adding that algae still has enormous future potential. “Where we are with the algae today is further along than, quite frankly, anyone has ever been with algae, in terms of productivity, in terms of the ability to replicate the results outdoors.”
Remarkable? Does the research and findings to date have any market value? Or was it just a wealth transfer to some academic researchers and expensive greenwashing? Lee Raymond would have never done it back when ExxonMobil was one of the best managed companies in the world.
Conclusion
The biofuels problem is one of energy density from which a lot of other problems emerge. [2] Crude oil remains king.
It can only be hoped that the mistakes of the present (algae yesterday, carbon capture tomorrow) can be lesson learned. Referring to the 1970s, Joseph Pratt and William Hale remarked:
Thinking that the oil industry might well be dying a slow death, Exxon and most major oil companies moved out of oil in search of opportunities for long-term growth. Exxon spent considerable capital, management effort, and research dollars on diversification into industries completely outside of energy, as well as into energy industries other than oil and gas.
Mistakes all, the company exited the businesses and “refocused its attentions on its core business: oil, natural gas, and chemicals [and] … emerged at the end with a sharper focus on its core businesses and a renewed sense that oil and gas would remain its priority well into the future.” [3]
There is more hope today than yesterday. But carbon capture and storage remains as a Great Distraction at ExxonMobil. Bad PR from right and left, too.
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[1] Milloy testified at the 2021 meeting:
At the 2008 annual meeting, I told then-CEO Rex Tillerson that appeasing climate activists would lead to disaster. I suggested a way out: Ban these stupid shareholder proposals. I delivered the same message to current CEO Darren Woods in 2017. He didn’t listen either…. This year I proposed that Exxon push back on climate idiocy by disclosing the actual costs and benefits of cutting emissions. The costs of emissions cuts, you see, are very high and the benefits are zero. But the ever-obtuse Mr. Woods refuses to acknowledge these realities.
[2] “The process requires vast amounts of energy so much so that algal biofuel production might consume more energy than it produces, some researchers concluded.” – Christopher Matthews, “Exxon Sees Green Gold In Algae-Based Fuels. Skeptics See Greenwashing” (Wall Street Journal, October 4, 2021)
[3] Pratt and Hale, Exxon: Transforming Energy, 1973–2005 (Austin: Briscoe Center for American History, 2013), p. 167.
“We need to get on the deployment curve for carbon capture, for hydrogen, for biofuels. Algae still needs some more work.”
How about getting on the deployment curve for Science, instead of propaganda? Carbon capture is the stupidest thing since the Pet Rock, though not as profitable.
I once tried to sell pet coal rocks. I put little eyes on them, so they looked cuter.
They didn’t sell.
Three words every green strategy bears…
It didn’t work.
It didn’t work.
That wholly depends on your metrics. If your goal was to grift hundreds of millions of dollars of tax subsidies from gullible Western governments AND be feted at Davos for your virtue and noble protection of the planet – then these green energy schemes work very well indeed!
I think one’s moral compass comes into it at some point
The gutter, cesspool crowd have no moral compass.
They didn’t do it right. Next time, we’ll do it better.
Said every communist ever.
I recall seeing young people going in the direction of biofuels with their career planning. It looked questionable back then and now it’s toast. Add them to the pile of casualties from bad energy policy and politics entering its second or third generation.
Shell’s IH2 is still under pilot. The fact is that money can be made via carbon credit harvesting (tax payer funded). It just has to make green, not be green.
https://www.shell.com/business-customers/catalysts-technologies/licensed-technologies/benefits-of-biofuels/ih2-technology.html
Exxon knows
The fixation we have with burning stuff/things/anything/everything is going to be our absolute undoing.
Burning biomass is suicidal insanity.
Even if they’d ‘just’ grown the algae then handed it out farmers/gardeners/park-keepers to use instead of artificial fertilisers, it would have made an infinite, real and positive improvement to The Climate – compared to the negative everything that making fuel out of it does
Sod the carbon footprint, doing so would have reduced the ‘water footprint’.
And as its water that controls climate……. who knows what might have happened.
Looks like nobody ever will.
I almost upvoted, but the word “infinite” does not belong.
That is a clueless remark, Peta. Just look at the infrastructure, energy, raw materials and water resources it would take to scale up algae production to an appreciable level. If they can’t cost-effectively make a high value fuel from it at large scale, then just tilling the algae into the ground would be suicidal.
scrape the algae off ponds and throw it on the land
not hard nothing much but a damned big pond or on farm dams required I told a local farmer I worked with to stop bitchin at the algae and USE it instead..no he didnt of course its too easy and didnt cost him more via the bank n chemcos. our town just spent 25k or our rates!! cutting pondweeds they didnt remove n sell or use so then? the lake was closed due to the nitrogen levels we lost the fishing comp and tourists
“…including a seven-fold increase in the productivity of algae grown in outdoor ponds…”
Hmm… I’d like to know how that was calculated. It doesn’t pass the smell test. There is only a limited amount of sunlight to be harvested and evolution has been trying to optimise photosynthesis for quite a long time.
Thirteen years ago in 2010, there were confident predictions that biofuels produced from genetically-enhanced algae grown in massively large ponds in the southern tier states would end the need for oil drilling in the US within two decades.
These genetically engineered enhancements were said to be capable of producing a type of algae which would be three times more efficient at converting sunlight into plant sugars than any existing types of algae. Biofuels sourced from algae would replace oil as a main staple of energy production in Texas.
Thirteen years later, another energy panacea bites the west Texas dust.
seven layers of grow trays, each with its own bank of grow lights?
Exxon did make a reasonable decision in acquiring Zilog, as the Z-80 was a very successful processor. The problem was more of management as Zilog would most likely have been better off in getting the Z-800 (a 16 bit compatible upgrade to the Z-80) out before the Z-8000.
I recall seeing the news about Sapphire Energy back around ’08
using a GM algae that mimicked crude oil. They processed the algae
into jet fuel and flew a 737 around the country with that for fuel as a
demonstration project..
The part that I really liked was it looked like a way to stop the nutrient
loaded waste water pollution that gets dumped into our rivers and streams.
It wasn’t being promoted for that, the pitch was a fossil fuel replacement.
Waste water pollution is a big deal…NPK mucks up the water for the next
people down river, Period. The green bio fuel part I could give a rip about
beyond a way to justify the clean up.
“And it is reminiscent of Exxon’s failed ventures in the 1970s: Office equipment. Real estate. Synthetic fuels. Shale oil. Electric motors. Solar panels. Uranium. Copper.”
All those ideas worked out – for somebody else. Imagine if they’d invested the money in Office Depot, Pulte, etc. IPOs
Duh. Algae was a clear loser from the start. Just run a few scale-up calculations. Exxon Mobil is smart enough to know that. This was just greenwashing pure and simple.
They should just do what they do best. If or when we drift away from oil & gas based transport and combustion fuels, refiners will gradually retool their refining slate toward chemical feedstocks. This will require massive investments and a gradual turn, very similar to what we will see in the slow, gradual turn from coal and gas to nuclear for electricity generation. Not a crisis, not an emergency.
The other ruinables (wind and solar) will plateau or decline as they are found to be costly, unreliable, environmentally destructive, and infeasible at high penetration. They will be niche players.
Alternatively, the fanatics will manage to destroy the world’s prosperity, starve billions, and relegate those who remain to short, brutal and hopeless lives under the jackboots of the totalitarian elites.
Harvesting human hearts on top of pyramids was costly but it seemed to presist as long as the culture that practiced it. Wind and Solar has no less a fanatical following.
Better move along to batteries now…
story tip
Lithium-ion batteries still burning days after start of fire in Lancaster County, Pa. (wgal.com)
Curious story, what kind of batteries? New ones? Old Tesla ones? Why were they being stored there?Seems hinky to me. We will see more of this. Batteries pilling up with no safe way to dispose them.
Outdoor ponds?
So, explosive growth algae is outside where it can spread, even to distant ponds since the wind, water birds and insects carry algae cells.
Sounds like an environmental disaster, Exxon folks are now sweeping under a rug and distancing Exxon away from algae production??
I remember talking to some of the Exxon researchers back at the beginning. There was a problem that the algae produced a carcinogen in the process. Getting rid of this was key to making it successful. Imagine if that part was released in all these “volunteer” ponds.
Many of those who want to save the world also are into “going organic”.
Organic foods, organic farming etc.
What energy sources are more “organic” than coal, oil and natural gas?
Call it what it is: Green Grifting.
I did an analysis of Algae to Fuels back in 2009 at a conference on algae oil in Scottsdale. They hadn’t pulled it all together yet, so I did it for therm. They had yield, power use, land needed and all the data to estimate what an algae project would look like, but the didn’t put it all together. Here is the situation. Capture CO2 from Arizona Power and Light’s Apache power plant. Feed it to an algae pond to grow algae for fuel production. Isolate the algae, extract the oil, and hydrotreat to make fuel. Just the algae field alone would cost $32B and consume more electric power running the system than it produced in fuel energy. The algae raceways (troughs) would be 1/4 mile long and require precision unprecedented in the industry. They would evaporate 10 vertical feed of water a year requiring nearly constant removal of salts, Dust would blow into the troughs as well requiring more cleaning. The total land area would be 64 sq mi and it would produce 5,000 bbl/day of fuel.
Such a bargain! No wonder it never took off. And in the intervening 14 years, essentially nothing has changed. Algae is still the darling fuel feedstock that will never work. No wonder Exxon (finally) abandoned this approach.
algae oil in Scottsdale.
Water plants … sited in … Arizona!?!? Someone got bored talking solar panels and spent fuel sequestration
We’ve been using biofuel since early humans developed. Till very recently however people were smart enough to let nature do the manufacturing. Now our most useful biofuels (oil, gas and coal are all derived from organic matter after photosynthesis traps the suns energy) are all labeled as climate toxins by people who don’t like the fact that human society is doing pretty well. I invite all those naysayers to stop using the said toxins and go back to dung and twigs to keep themselves out of the cold and dark.
Hasn’t that been clearly identified as the real core problem?
Carbon capture is not a mistake, especially direct air capture. It is a viable and cost effective way to get bureaucrats off your back and meet compliance goals. It is the only viable means of “net zero” flight, and probably much more reasonable than hydrogen for steel, or the ridiculous approaches for concrete.
When it comes to subsidy farming and minimum compliance requirements carbon capture is king. If paired with solar plants in a desert it should be able to run a lot of carbon capture for a fairly low price.
Is it a good approach? Depends on how you define “good.” It is probably the lowest cost means of compliance, which is “good.” However, it is a waste of money so in that way it isn’t.
chadb:
Lowest cost of doing something that has no meaningful effects is still a waste of money.
Physics Today [2022] had a piece on Direct Carbon Capture highlighting Climateworks: the world’s largest DAC company. They can capture 4000 tons of CO2 per year and hope to get to 10,000 tons by late 2023. Very energy intensive, thus costly: ~ $600/ton.
Note that the world produces ~ 37 billion tons of CO2 yearly. It does not scale.
Now, if Congress would only end the stupendously stupid and wasteful corn ethanol subsidies. Of course, those subsidies are heavily lobbied for by ag interests, not leftwingnut enviroweanies. And those midwestern farm state senators are always among the most powerful in the Senate.
Never Happen. Iowa is the first primary and no candidate will risk that platform if planning to actually move forward in the primaries.
Kudos to Steve Milloy again. If Exxon truly wanted to further energy development it would invest in improving and building nuclear plants. That way we can use fossil fuels for the stuff we really need and want chemicals, plastics, clothing, ICE fuel most importantly gasoline for hot rods.
Exactly. There’s not much you can do with uranium other than make depleted uranium munitions or electricity. It’s a crime to burn valuable chemical feedstocks like oil, coal and natural gas just to make electricity. Maybe keep the best of the liquids for transport, expecially aviation.
“The process requires vast amounts of energy so much so that algal biofuel production might consume more energy than it produces, some researchers concluded.”
Exactly like a wind, solar, battery backup system. Thermodynamically, a net energy consumer.
yet again
so downunder we have ABC giving a lot of airtime to the algae fuel dweebs who are raving it up at OUR expense of course was WA I think the chap came from on last weeks radio show.
and the utterly useless CCS is still getting the spin here too even after your epic fails in ussa and elsewhere
no cure for stupid, especially if its tax$ paying their wages
Energy density is an issue, but not the main issue.
The main issue is scalability. How do you grow enough algae to replace even 1% of the ~375 billion gallons of oil used just by the United States in 1 year? How much water? How much fertilizer? How many tanks? Harvest?
The entire field is idiotic.
Peter Lynch of Fidelity Magellan mutual fund fame called efforts by multi-national corporations to go beyond what they do well as “Deworsification”
To add insult to injury, in 2021 the leftwing shareholder activist group Engine No. 1 won two seats on the ExxonMobil board of directors. They were backed by all the usual culprits: BlackRock, Vanguard, TIAA-CREF, et al. Last year ExxonMobil threw in the towel and they had management backing for re-election. I withheld my vote for them, but my pittance of 206 shares doesn’t even register on the radar screen.