Solazyme and Bunge Global Innovation have announced that they and other Bunge subsidiaries have signed definitive agreements forming a Joint Venture ("JV") to build, own and operate a commercial-scale renewable tailored oils production facility adjacent to Bunge's Moema sugarcane mill in Brazil. The JV, which will operate under the name Solazyme Bunge Produtos Renovaveis Ltda., will have an expected annual production capacity of 100,000 metric tons of oil.

The facility will utilize Solazyme's renewable tailored oil production technology, coupled with Bunge's sugarcane supply and processing capabilities, to produce sustainable tailored triglyceride oils for use in oleochemical and fuel applications in the Brazilian domestic market. Financial terms of the agreements were not disclosed.

"Bunge is excited to partner with Solazyme to commercialize its innovative sugar-to-oil technology platform, which will enable us to link our sugar and vegetable oil value chains," said Ben Pearcy, Managing Director, Sugar and Bioenergy, and Chief Development Officer, Bunge Limited.

"The tailored oils we expect to produce will not only expand our portfolio and address the growing demand of the fuels and oleochemicals industries, but also increase our capabilities to leverage new technologies for future opportunities in sugar and bioenergy."

"The JV's commercial-scale production facility in Brazil will provide Solazyme with the capacity we need to produce renewable tailored oils to meet the strong demand we're seeing in our initial target markets," said Jonathan Wolfson, CEO, Solazyme.

"As a leader in oilseed processing and sugarcane milling, Bunge brings crucial expertise and scale to the table. Their global presence in sugar and vegetable oil markets, large-scale processing experience and significant footprint in Brazil, coupled with our advanced fermentation technology, creates a powerful alliance in the rapidly emerging area of tailored oils."

The facility, which will be equally financed by Solazyme and Bunge, has been designed to integrate with a new cogeneration unit at the Moema mill, and can be expanded for further production in line with market demand. Startup is expected in the second half of 2013.

Today's announcement follows a history of collaboration between the two companies, beginning with Bunge's 2010 equity investment in Solazyme, followed by a May 2011 Bunge-funded Joint Development Agreement ("JDA") to develop oils that could be sold commercially.

Also in May 2011, Solazyme granted warrants to Bunge for the purchase of Solazyme shares, conditional on key milestones related to the timely implementation of the JV and plant construction. In August 2011, Solazyme and Bunge announced that they had entered into a Joint Venture Framework Agreement setting forth the preliminary terms of the JV and commencing engineering for the plant. This series of agreements has now culminated in the formation of the JV.