February 24, 2009 / 8:33 AM / 11 years ago

INTERVIEW-UPDATE 1-Novozymes to halve bioethanol enzyme price

* Says can halve bioethanol enzyme price to 50 cts/gln fuel

* Sees bioethanol production price at $2.50/gln next year

* Sees U.S. missing 100 mln gln cellulosic target in 2010

(Adds details, quotes)

By Gelu Sulugiuc COPENHAGEN, Feb 24 (Reuters) - Denmark’s Novozymes A/S (NZYMb.CO) will halve the price of enzymes used in the production of second-generation ethanol to 50 cents per gallon of fuel by next year, company officials said on Tuesday.

This will help cut the production price of the fuel, which is made from crop waste, fast-growing grasses and wood chips, to $2.50 per gallon from $3.50 per gallon now, said Poul Ruben Andersen, marketing director for biofuel at Novozymes.

“The other 50 cents will come from innovation and efficiency in the overall process of pre-treatment and ethanol fermentation,” Andersen said.

The environmentally friendlier version of the biofuel avoids the blame for food price inflation attached to ethanol made from corn. But it is harder to make as it requires breaking down tough cells walls into sugars which can be fermented into fuel.

Washington provides subsidies and incentives equivalent to about $1 per gallon. The United States requires 100 million gallons of cellulosic fuel to be blended into gasoline next year as part of a larger plan to reduce dependence on foreign oil, but Andersen said this target was not likely to be met.

“One hundred million gallons by 2010 is not likely to happen because there is not enough production capacity,” he said. “This goal will likely be delayed by one year.”

The Danish company is the world’s leading maker of industrial enzymes. Andersen said Novozymes was ready to supply enough enzymes for 100 million gallons of cellulosic ethanol.

(Editing by David Holmes)

((gelu.sulugiuc@reuters.com; +45 33 96 96 50; Reuters Messaging: gelu.sulugiuc.reuters.com@reuters.net)) Keywords: NOVOZYMES/

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