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10/09/2008 07:15 AM

Mascoma To Build Cellulosic Refinery in Michigan

SustainableBusiness.com News

Mascoma Corporation has received a total of $26.0 million in funding from the U.S. Department of Energy (DOE) and an overall contribution of $23.5 million from the State of Michigan for the development of a cellulosic fuel production facility that uses non-food biomass to convert woodchips into fuel.

The facility will be located in Chippewa County in the Upper Peninsula of Michigan, in the town of Kinross. The funding provided by DOE and the State of Michigan will accelerate Mascoma's construction of the facility and the scale-up.

Mascoma chose to locate the facility in the Upper Peninsula of Michigan after an extensive review process of other location options. The decision was based largely on the support provided by the State of Michigan, the availability of extensive sustainable feedstock in forests and other agricultural biomass resources in the region, and the expertise available through the Michigan-based project partners and workforce.

Michigan Governor Jennifer M. Granholm recently signed a package of energy laws creating a 10% renewable energy portfolio for the state.

"Michigan is proud to partner with Mascoma as a part of our commitment to lead the nation in alternative energy production," said Governor Granholm. "This company, and their partners, will create jobs in Michigan as they develop the next generation of cellulosic ethanol that will reduce our dependence on foreign oil and make fuel more affordable for our families."

"This funding will allow us to accelerate commercial production of low cost, low carbon fuel that will reduce greenhouse gas emissions and promote energy independence," Bruce A. Jamerson, Chairman and CEO of Mascoma Corporation, said.

Drawing on Michigan's substantial natural resources, the facility will use sustainably harvested mixed hardwood chips and other non-food biomass materials as the raw material for the production of cellulosic fuel. The first phase of the project will develop preliminary engineering designs and permitting required to initiate construction at the Kinross site.

Mascoma is partnering on this project with a well-established natural-resources company, JM Longyear, based in Marquette, Michigan. Longyear was founded 120 years ago and is experienced in timber, mining and project management.

The collaboration will involve the formation of a new company, Frontier Renewable Resources, which will own the project. In addition, Mascoma will team up with Michigan State and Michigan Tech Universities to tailor Mascoma's technology and supply chain options for the specific Michigan feedstocks used in production.

Mascoma's production facility is expected to produce 40 million gallons of ethanol and other valuable fuel products per year. General Motors Corporation (NYSE: GM) and Marathon Oil Corporation (NYSE: MRO), which are both investors in Mascoma, are providing support for this project.

About Mascoma

Mascoma Corporation is a leader in advanced low-carbon biofuels technology and is based in Boston, Massachusetts. Using proprietary microorganisms and enzymes developed at the company's laboratories in Lebanon, New Hampshire, Mascoma is deploying advanced technologies that enable the creation of fuel from a range of non-food biomass feedstocks. Mascoma is developing demonstration and commercial scale production facilities globally.

Website: http://www.mascoma.com