Kior, the advanced biofuels company that makes fuel from pine wood chips, received commitments for $100 million in equity from investor Vinod Khosla's venture fund and an affiliate fund of Bill Gates.
Khosla Ventures has committed $85 million and Gates Ventures $15 million in equity financing, Kior said in a statement Monday.
The financing will be used to expand production at its Columbus, Mississippi plant. Once the expansion and planned technology upgrades have been completed, the so-called Columbus II project is expected to achieve overall positive cash flow operations sometime in 2015, the company said.
Kior CEO Fred Cannon said the equity financing from Gates and Khosla completed what they believe will be the last equity portion of the $225 million Columbus II project. The company still plans to develop its standard scale commercial facility in Natchez, Mississippi.
In March, Kior made its first commercial shipment of cellulosic diesel, good news for an industry that has struggled to scale up commercially. Despite that initial positive step, Kior—along with the rest of the advanced biofuels industry—has continued to suffer from setbacks.
For example, Kior shipped only 75,000 gallons in the second quarter far below its forecast of 300,000 to 500,000 gallons. Its failure to meet production targets led one investor to file a lawsuit in August accusing Kior of making false statements.
This post was originally published on Smartplanet.com