Australia-based biofuel company Algae.Tec Ltd. has announced an agreement with Lufthansa to build an aviation biofuels production facility in Europe. The airline carrier will provide 100 percent of the project’s funds and will commit to a long-term “offtake agreement” of at least 50 percent of the crude oil produced at a set price. Algae.Tec will manage the facility and receive license fees and profits. The algae oil produced will fulfill the European Union Renewable Energy Directive and be certified according to the International Sustainability & Carbon Certification standard. The deal must be approved by both companies’ boards, and a final feasibility report will be completed when the site has been chosen. See Algae.Tec News Release, September 19, 2012.

In a related development, the company has reportedly unveiled plans to raise $600 million by 2015 to build at least six production facilities in Australia, Brazil, Sri Lanka, and the United States. According to Algae.Tec Chair Roger Stroud, “We will be using different project finance structures for all of these projects and they’ll all be roughly $100 million.” He contends, “There’s no shortage of people who will buy the fuel; both our biodiesel and jet fuel.” The company’s outlook improved on recent news that the European Commission decided to limit crop-based biofuels to 5 percent of transportation fuel, turning instead to the new generation of biofuels made from waste products, grasses, inedible plant parts or non-food feedstocks such as algae. See Reuters, September 24, 2012.