GraalBio is planning to build the first cellulosic ethanol plant in Alagoas, Brazil.
The BRL300m ($147m) plant will initially produce 82 million litres of ethanol annually and will run by using sugarcane bagasse and straw as feedstock, which will eventually be replaced by energy cane.
In anticipation of the construction of the cellulosic ethanol plant, GraalBio has signed an agreement with Chemtex to license its Proesa technology, a combination of steam-explosion, enzymatic hydrolysis and fermentation, for use in the plant.
GraalBio will use Proesa technology for the pre-treatment and conversion of biomass, making it possible to convert several types of raw materials into biochemicals and biofuels.
GraalBio has also signed an agreement with Beta Renewables, which is setting up another biorefinery in Italy using Proesa, to co-develop the new technology in Brazil.
BetaRenewables CEO Guido Ghisolfi said: "We believe that Proesa technology will let producers see superior returns on their investments, while enabling more sustainable production of advanced biofuels and bio-based chemicals."
In addition, Novozymes will provide its new generation of enzymes and DSM will supply genetically modified yeasts that will ferment the second-generation ethanol.
The construction of the plant is expected to start in July 2012, with initial production set for the last quarter of 2013.
The company is also planning to build a plant to develop new biochemical pathways, as well as establish a research centre to develop genetically modified organisms to be used in the production of biochemicals and biofuels.