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Gold/Mining/Energy : Energy Biosystem Corp NASDAQ-ENBC

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To: EAGLE-EYE who wrote (123)7/13/1998 10:36:00 PM
From: ForYourEyesOnly   of 336
 
Riding the fossil fuel
biodesulfurization wave

"Catch a wave and you're sittin' on top of the world..."
-- Brian Wilson/The Beach Boys

Daniel J. Monticello

B iodesulfurization is a process that removes sulfur from fossil fuels
using a series of enzyme-catalyzed reactions. In 1993, Iain Campbell, a
professor of microbiology at the University of Pittsburgh and long-time
participant in biodesulfurization research, wrote an article for CHEMTECH
entitled "Catching the biodesulfurization wave" (1). It outlined the science
and politics of biodesulfurization research in the United States, focusing
on the "wave" of government support of this technology in the late 1980s
and the results of that support. Since then several industrial, government,
and university laboratories have caught the wave and have been riding it
for almost five years. In this article, I describe the issues that drive the
continued interest in the biodesulfurization of fossil fuels, look at the
agencies (governmental, academic, and industrial) that have sponsored
the work, identify the major players in this field, and outline the scientific
and technological progress that has been made as we have been riding
the wave of this development effort.

TO SIDEBAR: The players

The nature of the problem
The problem with fossil fuels is that the combustion products are hard on
the planet. Carbon dioxide emissions have been implicated in global
warming. Nitrogen oxides and sulfur oxides emissions have been shown
to be responsible for acid rain, which dissolves buildings, kills forests,
and poisons lakes. Governments throughout the world have recognized
the problems associated with these emissions and moved to reduce them
through legislation. The restriction of "greenhouse gas" emissions
(particularly carbon dioxide) is currently the subject of fierce debate. For
the past decade, almost everyone has agreed that restricting sulfur
emissions is a good idea; the battle now is fought over the level of
emissions to allow.

The easiest way to limit the amount of sulfur dioxide emitted into the air
is to limit the amount of sulfur in fuel. Another (but less practical) way
would be to make more efficient scrubbers on stationary emitters and
install them on mobile emitters (such as trains, planes, and automobiles).
Understandably, government agencies have opted for regulations that
mandate the level of sulfur in the fuel. Gasoline and diesel fuel have been
particularly attractive targets. "Straight-run diesel" (taken directly from the
crude distillation tower) can have sulfur ranging from <500 ppm to >5000
ppm, depending on which crude oil is used and whether it is desulfurized
already in refineries. Currently, U.S. on-highway diesel fuel must be <500
ppm sulfur, but even lower sulfur levels have been mandated. Some of
these levels are shown in Table 1.

TO SIDEBAR: Table 1.

Fuel desulfurization seems like a reasonable approach to reducing acid
rain except for one inevitable problem: It costs money, and as the extent
of desulfurization increases, the costs escalate rapidly. This is a direct
result of the process chemistry, hydrodesulfurization, used in refineries to
remove sulfur. Hydrodesulfurization is a high-pressure (150-250 psig) and
high-temperature (200-425 øC) process that uses hydrogen gas to reduce
the sulfur in petroleum fractions (particularly diesel) to hydrogen sulfide,
which is then readily separated from the fuel. Hydrodesulfurization units
are expensive to build and operate. In addition, this chemistry does not
work well on certain sulfur molecules in oil, particularly the polyaromatic
sulfur heterocycles (PASHs) found in heavier fractions (Table 2) (2). It is
this limitation in the conventional technology that has tempted
researchers over the past 50 years to venture into the inviting waters of
biotechnology to catch the wave of alternative sulfur removal processes.

TO SIDEBAR: Table 2.

Our understanding of the impact of sulfur emissions on the environment
has grown increasingly sophisticated over the last 20 years, but the
desire to desulfurize oil is not new, and the interest in this issue has
indeed come in waves, as Campbell described. The first recorded wave
was in the early 1950s, when a series of U.S. patents were issued on
"microbial desulfurization" processes (3). They never actually worked, but
that's another story.

The next big wave was in the late 1970s and early 1980s. The U.S.
Department of Energy (DOE) and other organizations sponsored work
around the country to try once again to crack this scientific and
technological nut. Although significant progress was made (4), the
biggest development was the clear insight into what didn't work. The
bacteria that had been isolated at the time were not appropriate for
commercial desulfurization technologies because they attacked the
hydrocarbon portion of PASHs and only coincidentally solubilized the
sulfur molecules to water, thus removing them from oil. Many of the
polyaromatic molecules (naphthalene, phenanthrene, etc.) were also
attacked. This was successful desulfurization, but the cost was too much
of the fuel value of the oil. It was clear then that further development work
was pointless until an enzymatic system that specifically attacked the
sulfur atom in the PASHs in oil could be identified.

Campbell's article also described the next wave of activity, in the later
1980s, directed (successfully) at identifying bacteria that could liberate
sulfur from the model PASH dibenzothiophene without attacking the
hydrocarbon. This development and the subsequent characterization of
the system lead to the latest and, by far, the largest and most sustained
wave of development. It looks as if this effort has been sufficient to create
a nascent biodesulfurization technology. It remains to be seen whether
this effort will be sufficient to complete the journey or whether more
breakthroughs will be needed for the widespread application of this
technology.

Follow the money
A useful way to track the industrial interest and enthusiasm for a
technology development effort is to examine the kind of money that is at
stake and the sources of R&D funding. The economic potential for
desulfurization technologies is enormous. About 60 million barrels of oil
are produced each day, with an average sulfur content of about 1.1%.
This is expected to rise in the coming decade (Figure 1).

Figure 1.

Industry experts suggest that the refining industry will have to spend
about $37 billion on new desulfurization equipment and an additional $10
billion on annual operating expenses over the next 10 years to meet the
new sulfur regulations. In addition to this opportunity in the refinery, there
is also a large potential in the desulfurization of crude oil itself.
Approximately half of the 60 million barrels of crude produced each day is
considered "high sulfur" (>1%). The partial desulfurization of this material
represents a significant chance to "upgrade" the crude and its value.

My employer, Energy BioSystems Corporation (EBC), has spent the
most money worldwide on microbial desulfurization research since 1992.
The other major spender has been the Petroleum Energy Center (PEC) in
Japan.

EBC has spent about $50 million isolating, characterizing, and
manipulating the desulfurization genes from a variety of microorganisms
and developing and testing the reactor, separations, and recovery
technology that is required to commercialize biodesulfurization. As a
publicly traded company in the United States, these numbers are fairly
easily calculated based on annual reports.

PEC has also been active in this area and, in 1994, pledged $50 million of
its own for development of the technology. PEC is a Japanese
government-industry consortium, and therefore, it is difficult to determine
the actual spending. The number of papers that have appeared over the
past three years indicates a substantial, if fragmented, program.

The U.S. government, through the ongoing support of several academic
and government labs, has spent about $10 million since 1990, including a
$3-million Advanced Technology Program (ATP) grant to EBC for crude oil
desulfurization, and the steady participation of DOE in cooperative R&D
arrangements at the Oak Ridge and Brookhaven National labs and small
sponsored programs at the Institute of Gas Technology and other
academic labs. DOE recently awarded EBC a $2.4-million grant to pursue
gasoline biodesulfurization.

The oil companies have spent only small amounts on this wave of
technology development, mostly being content to sit on the sidelines and
watch. The exceptions to this have been

Total Raffinage Distribution, S.A., which is working with EBC on
diesel biodesulfurization;
Texaco Exploration and Production Technology Division, which is
working with EBC on crude oil biodesulfurization;
Koch Refining Company, which is working with EBC on gasoline
biodesulfurization; and
Exxon, which has had its own effort and has sponsored work in
Canada.

The total expenditure over the past five years by the oil companies is
probably only $5-10 million. As might be expected with such a
competitive and uncoordinated effort, a lot of money has probably been
wasted on redundant and repetitive efforts.

The science
To manipulate the bacteria that are responsible for these important
reactions, we must understand their underlying genetics, biochemistry,
enzymology, and microbiology. As a result, the big winner of this
research wave thus far has been the scientific community. The metabolic
pathway for the sulfur-specific oxidation of dibenzothiophene (DBT) was
completely unknown 10 years ago. Today, the details of the pathway are
published and are on the University of Minnesota
biocatalysis/biodegration database Web site
( labmed.umn.edu.

Model systems for desulfurization. The usual model molecule for
studies of desulfurization is DBT. It has been used for many years in the
development of conventional catalysts for hydrodesulfurization, and it is
representative (to a degree) of the more troublesome molecules in the
diesel fractions of crude oil (2). There is actually not much DBT in
hydrotreated diesel fuel, but this simple PASH is still a reasonable
choice. It is one of many tens of thousands of PASHs found in a
hydrotreated diesel sample, and the alkyl side chains that generate all
these isomers have been shown to significantly affect the relative
reactivity of the molecules with inorganic (cobalt-molybdenum) and
organic (enzyme) catalysts (5). The alkylated DBTs (Cx-DBTs) are the
actual targets for the technology and should be evaluated as a whole
whenever possible. However, most of the basic scientific work that has
been reported has been done with DBT.

Sulfur-specific Cx-DBT metabolism. In the following sections, I outline
the latest work on the metabolism of Cx-DBTs via the
hydrocarbon-conserving (4S) pathway first proposed by Iain Campbell and
Kee Rhee at DOE's Pittsburgh Energy Technology Center. The activity
has been observed in many species of bacteria since the first confirmed
isolation by Kilbane in 1988 (6). In most cases, the bacteria have been
closely related and catalyze the same reaction. The general steps in this
biodesulfurization system as we understand it from studies on various
bacterial species are illustrated in Figure 2.

Figure 2.

The first step in desulfurization of these molecules is the transfer of the
molecules from the oil into the cells. It appears that in Rhodococcus
spp., these molecules are transferred directly from the oil to the cells.
This is likely, because Rhodococcus spp. and other bacteria have been
shown to metabolize many "insoluble" molecules in this fashion. The
desulfurization (dsz) genes have been transferred to other organisms,
such as Escherichia coli and Pseudomonas putida (7). In these cells, the
PASHs appear to partition to the water before being brought into the cell.

Conversion to the sulfone. The enzyme directly responsible for the first
two oxidations has been isolated and characterized in some detail (8).
The gene for this enzyme (dszC) has been cloned and sequenced. The
enzyme has been named DBT monooxygenase (FMNH2:DBT
oxidoreductase) to reflect the reaction it catalyzes: the transfer of an
electron from flavin mononucleotide (FMNH2) to DBT to produce oxidized
FMN (FMNH2), DBTO, and DBTO2. DBT monooxygenase catalyzes the
oxidation of DBT to the sulfoxide and also the oxidation of the sulfoxide to
the sulfone. The enzyme appears to operate as a tetramer in the cell. The
genes for this enzyme have been cloned and described (9, 10).

Cleavage of the first C-S linkage. The first cleavage of the carbon
sulfur bonds is catalyzed by DBT sulfone monooxygenase
(FMNH2:DBTO2 oxidoreductase, which transfers another electron from
FMNH2 to DBTO2). This enzyme and its gene, dszA, have also been
characterized (5, 8, 9). It appears to operate in the cell as a dimer.

Liberation of inorganic sulfur. Production of sulfite and an intact
hydrocarbon molecule is the last reaction in the pathway. This is
catalyzed by a "desulfinase" (coded by the dszB gene) and leads to the
release of the sulfur as sulfite and the production of the oil-soluble
product, hydroxy biphenyl (HBP).

In nature, the cell has achieved its goal at this point--it has the sulfur it
needs to grow. The sulfite can be reduced to sulfide and incorporated into
sulfur-containing amino acids and vitamins necessary for growth.
Technologically, this is just the beginning. The flux through this pathway
must be amplified many hundredfold over normal levels to turn this
biochemical pathway into a industrially useful technology. This genetic
and metabolic engineering effort is underway currently.

The supply of reducing equivalents. Another important enzyme in this
system is the reduced nicotinamide adenosine dinucleotide (NADH):FMN
oxidoreductase, which keeps the supply of reduced FMN in balance (1).
The primary enzyme for this task in Rhodococcus spp. is a dedicated
flavin reductase (11). (Details of the genetics for this enzyme have been
submitted for publication by Charles Squires and colleagues at EBC.)

Regulation of the activity in the cell. Expression of the dsz genes in
Rhodococcus spp. is carefully regulated in "wild-type" cells. Presumably,
this is because the cells are rarely in a carbon-rich, sulfur-poor
environment that would favor cells expressing these genes. When the
cells are grown in a medium with even small amounts of sulfur, they stop
expressing the DSZ phenotype, presumably by repressing enzyme
synthesis at the level of transcription. My colleagues and I have
characterized the nature of this regulation in some detail (12) and are in
the process of modifying cells to effect this regulation so that the gene
will work continuously under process conditions.

Developing the technology
The idea of oxidizing PASHs in fossil fuels is not new. The refining
industry has been looking for ways to do this for many years, because
the resulting molecules (particularly the sulfones) are readily extracted
from the oil (13). The problem has always been one of selectivity: How
can the oxygen that is required for the reaction be activated while limiting
its action to the sulfur-containing molecules in the complex and reactive
oil matrix?

The bacteria have solved this problem with the use of a monooxygenase.
The oxygen is activated on the surface of the catalyst (with the electron
from FMNH2), which is inside the cell and specific for molecules with the
physical and chemical properties of the PASHs. This specificity gives the
microbial system its advantage over chemical systems for PASH
oxidation.

Turning this interesting metabolic phenomenon into an industrially useful
technology requires the development of a biocatalyst with rates and
stability that are amenable to process development. Beyond this, there
are numerous problems related to mixing, mass transfer, separations,
and byproduct disposition that I will not address here.

Genetic engineering. The key to increasing the metabolic flux through
the bacteria is to manipulate the basic genetic makeup of the system.
Fortunately, this doesn't require much manipulation of the organism as a
whole but rather modification of the dsz genes. We achieved a significant
increase in the flux simply by amplifying the expression of the four
proteins coded by the dsz genes. Initially, the biodesulfurization rate was
limited by the actual concentration of these proteins. Further increases in
activity may be achieved by modifying the proteins themselves, but this
has not been reported.

Alternative hosts. Another popular strategy in metabolic engineering is
to change the host bacteria strain for the genes entirely, perhaps to take
advantage of another strains's growth properties, physical properties (for
mixing and separations), or a higher intrinsic metabolic rate. We have
successfully done this, as has at least one other lab (14). In general, we
prefer to stick as close to the original strain as possible, for technical
(e.g., gene expression and codon usage preferences) and regulatory
reasons.

Biodesulfurization processes. Large-scale use of a biocatalyst
presents many challenges. Figure 3 illustrates one manifestation of the
technology. The process continues to evolve as we learn more about it
(15, 16). In this very simple system, the biocatalyst is supplied to a
simple stirred-tank reactor, which is also fed oil, air, and a small amount
of water. In the reactor, the PASHs are oxidized to water-soluble
products, and the sulfur is segregated into the aqueous phase. After
leaving the reactor, the oil-water-biocatalyst-sulfur-byproduct emulsion is
separated into two streams: the oil (which is further processed and
returned to the refinery) and the water-biocatalyst-sulfur-byproduct
stream. A second separation is needed to achieve this and allow most of
the water and biocatalyst to return to the reactor for reuse.

Figure 3.

In our 5-bbl/day pilot plant, we have evaluated several separation
schemes, including simple settling tanks, hydrocyclones, membranes,
and low-speed centrifuges. A combination of these technologies works
the best; and the final configuration will be determined by conditions in
the actual refinery, the precise physical properties of the target fossil fuel
stream, and the disposition option chosen for the sulfur byproduct.

The waves ahead
The commercialization of biodesulfurization processes for fossil fuels is
just around the corner, although the first operating units will not be online
before 1999, and it will take several years to hone the economics to
successfully compete with the conventional hydrotreating technology
found in most refineries. Hydrodesulfurization is a proven and
cost-effective technology; and biodesulfurization should be viewed as a
complementary technology to remove recalcitrant molecules, not as a
replacement.

The future of oil company and government sponsorship of research related
to this metabolic pathway and its application to oil and coal
desulfurization is cloudy. Like most oil companies, most international
agencies have adopted a wait-and-see attitude. DOE has committed
money to gasoline desulfurization, but otherwise the commitment to
basic research is small. Insights into the basic molecular mechanisms of
these novel enzyme-catalyzed reactions would have an effect on
bioremediation research, as well as in the academic and industrial
biotransformation community, where similar reactions are used to
produce chemicals and pharmaceuticals.

Skepticism of a new technology is to be expected. The reluctance of
conservative oil companies to encourage the development of new ideas is
typical of our risk-averse times. Government agencies have many
constituencies and priorities, and helping oil companies solve their
problems is not high on their lists. We are making small waves in a very
large pool. Still, when the technology can be demonstrated at the
commercial level and the technology is implemented in refineries instead
of new hydrotreating capacity, the next wave of desulfurization
development will not be a wave, but a tsunami!

Biodesulfurization of fossil fuels will become a reality by manipulating the
bacterial system at the molecular level. Our ability to do this is a result of
the many tools that have been developed to work at this level. The waves
emanating out from the profound advancements in molecular biology over
the past 20 years are not limited to developments in medicine but cover
all the areas where biotechnology plays (or might play) a role. In nature,
enzymes catalyze millions of unique reactions. Many of these are of
great commercial importance already (industrial enzymes are a
billion-dollar business), and more will be so in the future.

Another area ripe for exploration and exploitation in petroleum biorefining
is the use of enzymes and cells to catalyze biotransformations of
molecules from petroleum into higher value products. The future may see
the use of enzymes to catalyze many of the reactions currently run in a
petroleum refinery, such as cracking, viscosity reduction, and
demetalization.

Developments in science and technology often come in waves. Such is
certainly the case for biodesulfurization. Each wave has pushed the
technology closer to a commercial reality. With luck, this wave will be the
last one needed to get biodesulfurization to the marketplace!

Acknowledgements
Thanks to Rebecca Elliott and Lu Ann Galik for helping me put this article
together; Mickey Verkon for the great figures; and all the scientists,
engineers, and business guys at EBC for giving me a story to tell.

References
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