Novozymes, the world’s leading producer of industrial enzymes, and Lignol Energy Corporation, a leading company in the cellulosic ethanol sector, today signed a research and development agreement to make biofuel from wood chips and other forestry residues. The partners aim to develop a process for making biofuel from forestry waste at a production cost down to $2 per gallon, a price competitive with gasoline and corn ethanol at the current US market prices.

“Novozymes’ goal is to enable commercial production of cellulosic biofuel from a wide range of feedstocks,” says Claus Crone Fuglsang, Senior Director of BioEnergy R&D in Novozymes. “Our enzymes have the unique ability to turn wood residues and plant waste into fuel for our cars. Lignol is an industry frontrunner and our work together over the past couple of years has reinforced a shared vision to produce energy and value from wood waste. We look forward to continued improvement under this partnership.”

Pilot-scale biorefinery in Canada
Together, Lignol and Novozymes have the necessary know-how to turn wood residues into fuel. Lignol’s pre-treatment technology has established them as a leader in dealing with woody biomass and in February 2010, Novozymes launched enzymes that enable commercial production of biofuel from plant waste. The enzymes convert cellulose in biomass into sugars that can then be fermented into ethanol. The parties plan to use Lignol’s industrial pilot plant in Burnaby, British Columbia, Canada to optimize both Lignol’s process and Novozymes’ enzymes on different types of forestry waste. Later, Lignol plans to construct large-scale biorefineries for the production of cellulosic biofuel from wood chips and forestry residues.

“The progress we have achieved to date with enzymes from Novozymes is extremely promising and a successful outcome of this collaboration should position us to produce cellulosic ethanol from woody biomass profitably and without the need for long term government subsidies,” says Lignol President and CEO, Ross MacLachlan.

The agreement between Lignol and Novozymes formalizes a Memorandum of Understanding between the partners from February 2010.

About Lignol
Lignol (TSX-V: LEC) is a Canadian company undertaking the development of biorefining technologies for the production of fuel-grade ethanol and other biochemical co-products from non-food cellulosic biomass feedstocks. Lignol’s modified solvent based pre-treatment technology facilitates the rapid, high-yield conversion of cellulose to ethanol and the production of value-added biochemical co-products, including high purity HP-L™ lignins. Lignol is executing on its development plan through strategic partnerships to further develop and integrate its core technologies on a commercial scale. Lignol also intends to invest in, or otherwise obtain, equity interests in energy related projects which have synergies with its biorefining technology.