Solazyme, Inc. (NASDAQ: SZYM), a renewable oil and bioproducts company, and Archer-Daniels-Midland Company (NYSE: ADM), a leading global agricultural processor, announced today the signing of strategic collaboration, manufacturing and market development agreements in which Solazyme and ADM will produce Solazyme’s tailored algal oils in ADM’s advanced fermentation plant at Clinton, Iowa. These oils will be sold primarily to the industrial and nutritional markets in North America. Under the terms of the agreement, Solazyme will initially target the production of 20,000 metric tons of oil in 2014, with an aim to increase production to 100,000 metric tons in subsequent years.
“This agreement with ADM will further establish our commercial footprint in the U.S. for renewable oil production capacity at ADM’s Clinton, Iowa facility. This world-class facility and operating team are perfectly suited to run our tailored oil fermentation technology. Further, the location’s substantial renewable oil production capacity is in close proximity to our North American target customers,” said Jonathan Wolfson, CEO Solazyme. “ADM is also one of the largest marketers and suppliers of triglyceride oils with decades of experience and expertise in fats and oils. This collaboration offers a unique opportunity for Solazyme to access both capital-efficient manufacturing capacity and ADM’s unique research and application resources.”
ADM’s wet mill, which is adjacent to the fermentation plant, will initially provide dextrose for the fermentation; and steam and power will be delivered from ADM’s cogeneration facility that is partially fired with renewable biomass.
“This agreement with Solazyme allows us to profitably redeploy a world-class manufacturing asset that was previously used for PHA production and has been idle since January 2012,” said Mark Bemis, ADM senior vice president and president, Corn. “Solazyme has a portfolio of products for food and industrial applications that we think makes this collaboration an excellent option for this facility.”
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