the commercial airline industry (which uses most of the jet fuels in the world) to reduce carbon emissions in Europe, you also will have a market ripe for green crude. Jet and diesel distillates produced from green crude will be in demand for years to come.
X: The U.S. Department of Agriculture (USDA) said last month it would guarantee 80 percent of a $54.5 million loan to Sapphire Energy. How important is that to Sapphire?
JP: The USDA and its loan guarantee program is critically important from a capital and strategic perspective to our company. Given the state of the capital markets, the USDA loan guarantee program was a critical element in our ability to secure financing to commercially demonstrate large-scale algae cultivation for crude oil replacement processes. Strategically, partnering with the USDA supports Sapphire’s contention that algae production is a new form of agriculture production. The USDA partnership is the first step in a process to bring large-scale commercial algae agronomics and the all-important resources of the USDA to the table.
X: Has Sapphire been affected by the controversy over Solyndra’s bankruptcy filing? What’s your perspective on questions that are being raised generally over government support for renewable energy in general, which was the focus of this recent story in The New York Times.
JP: I don’t know the specifics of what happened at Solyndra. But fortunately for Sapphire, those issues didn’t have any real impact other than to raise the public profile around the USDOE loan guarantee process, which led to articles like The New York Times piece.
I might add the Department of Agriculture loan program is very different from the Department of Energy loan program. The USDA loan program has been around since 1936 and is rooted in the Rural Electrification Act that funded thousands of municipal governments and farmers to bring electricity to rural communities. Another form of energy I might add. This investment catalyzed a series of changes in rural America that raised farm income, increased education, and made possible the construction of a process to produce, store, transport, and export food and products throughout the world. Today, American agriculture is one of the largest U.S. exporters. It’s hard to imagine its enormous success without the government stepping in and saying that “electrification in rural communities is good for all of America, and therefore we are going to help these communities build it.” The USDA is trying to do the same thing today with crude oil replacements under a partnership with
