Chevron Corporation and the US Department of Energy's National Renewable Energy Laboratory have entered into a collaborative research and development agreement to study and advance technology to produce liquid transportation fuel using algae.

Chevron and National Renewable Energy Laboratory (NREL) scientists will collaborate to identify and develop algae strains that can be economically harvested and processed into finished transportation fuels such as jet fuel. Chevron Technology Ventures will fund the initiative.

Algae are considered a promising potential feedstock for next-generation biofuels because certain species contain high amounts of oil, which could be extracted, processed and refined into transportation fuels using currently available technology.

Don Paul, vice president and chief technology officer of Chevron, said: Chevron believes that nonfood feedstock sources such as algae and cellulose hold the greatest promise to grow the biofuels industry to large scale. Collaboration between industry, universities, research institutions and government is essential to overcoming the technological and commercial challenges of manufacturing high-quality transportation fuels from unconventional feedstocks.