Amyris to join Bunge, Cosan in cane bio-chemicals

SAO PAULO Dec 8 (Reuters) - U.S.-based Amyris Biotechnologies said on Tuesday it has signed agreements with Brazilian ethanol makers Cosan (CZZ.N), Bunge (BG.N) and Acucar Guarani ACGU3.SA to produce cane-based specialty chemicals and diesel.

Amyris has developed a second-generation biofuels technology using microorganisms to turn juice extracted from crushing cane into a biodiesel similar to the mineral-based fossil fuel.

"We'll invest in new production units located in (existing) mills to produce renewable chemicals," said Amyris Chief Executive John Mello on the sidelines of a press conference.

The new facilities will use cane juice from the three existing mills to produce chemicals which can be used in cosmetics, detergents, fuels and lubricants. They have a higher value than simple cane-based ethanol.

Amyris, which will invest more than $200 million to build the facilities, will be able to use up to 12 million tonnes of cane crushed per year in the three mills. This will be enough to produce 100 million liters (26.4 million gallons) of diesel equivalent, Mello said.

The U.S.-based company said last week it had bought a 40 percent stake in Boa Vista ethanol mill for around $80 million, from Sao Martinho (SMTO3.SA), one of Brazil's main sugar and ethanol companies.

The two companies have also established a joint venture that will add a new $50 million industrial unit to Boa Vista where Amyris will operate using its technology.

Mello said an agreement similar to the ones announced on Tuesday will be signed soon with another Brazilian ethanol company.

In October, Amyris said it had raised around $40 million from investors to boost its projects to produce diesel from sugar cane in Brazil. Funds came from shareholders including Khosla Ventures, Kleiner Perkins, Texas Pacific Group and the venture capital arm of Brazil's Votorantim Group.

New investors, such as Brazilian real estate and energy group Cornelio Brennand, have also joined the company.

The company's first test production unit was inaugurated in June, in Campinas in Sao Paulo state. (Reporting by Inae Riveras; editing by Reese Ewing and Marguerita Choy)