A team of researchers at Arizona State University's Polytechnic campus in Mesa is involved in a project to turn oil produced from algae into military-jet fuel.

Qiang Hu and Milton Sommerfeld, directors of the school's Laboratory for Algae Research and Biotechnology, will search for oil-rich strains of algae, evaluate their potential as oil producers and develop a production system that will yield competitively priced oil. UOP LLC, a Honeywell company, is leading the project, which the Defense Advanced Research Projects Agency is backing with a $6.7 million grant.

"We believe, at a minimum, that 100 barrels of oil per year per acre of algae is achievable," Sommerfeld said.

Hu said he hopes the technology could be commercialized in three to five years. Funding for algae research has been limited, and state and federal support is needed for the technology to be developed quickly, he said. The project is expected to be finished by the end of 2008.

As they age, algae cells expand and store more fat, from which oil can be extracted, Sommerfeld said.

Fuel produced through the new process will have to meet military specifications and is expected to achieve 90 percent energy efficiency for maximum conversion of feed to fuel, to reduce waste and production costs, according to the school.

The jet-fuel project is just one of several the lab is involved in. Others include using algae to reduce carbon-dioxide emissions from power plants and nitrogen and phosphorus from contaminated ground water. That's possible because algae consume those waste nutrients and convert them into renewable biomass for various applications, Hu said.

The laboratory is also using algae as a cell-factory to produce high-value pharmaceutical and nutraceutical products, Hu said.

Antioxidants and omega-3 fatty acids are examples of nutraceutical products.

Algae are primitive aquatic plants that require mostly simple-mineral nutrients for photosynthesis, growth and reproduction. They represent the most promising renewable source for biodiesel production, according to a lab presentation. Many species of algae produce large amounts of oils and fats that can be extracted and converted into biofuels, like biodiesel.

The lab says Arizona is well-suited for algae biodiesel technology development because of its climate, large quantity of saline groundwater that is unsuitable for crop irrigation, and vast land areas with minimal competition for conventional agriculture.

A Gilbert-based alternative energy firm, Diversified Energy Corp., is involved in a separate project that can convert oil from algae into jet fuel. Diversified has agreed on a license with North Carolina State University, for a biofuels- processing technology called Centia. The process can turn any lipid-based oil, such as canola oil, soybean oil, algae oil or animal-fat oil, into fuel, including into fuel for aircraft. The process is not based on one renewable oil so adjustments can be made to use a different one depending on pricing or availability.

Diversified is working to secure funding so it can do engineering work related to the Centia technology in Gilbert, said Jeff Hassannia, the company's vice president of business development.

The company had planned do that testing earlier this year in Gilbert but decided it made more sense to build the first demonstration plant and do the first tests in North Carolina, where the hardware for the project is, Hassannia said.

Algae could be an effective biofuel source, said Philip Brown, Diversified's president and chief executive officer.

"Your yield of oil per acre is significantly higher than that of vegetable oils," he said. "The No. 1 one issue the algae community has to address is capital cost per acre."