This is all over the news today as Brazilian development bank Banco Nacional de Desenvolvimento Economico e Social (BNDES) announced yesterday another hundred million dollars loan approval this time with Brazilian cellulosic biomass technology developer GraalBio following another announcement last week  on approving a $120m loan for the Solazyme Bunge joint venture.

BNDES said its holding company BNDESPAR will buy a 15% stake in GraalBio for Reais 600m ($294m), and the right to appoint a member of the board in the company. Over the next six years, GraalBio plans to invests Reais 4bn in cellulosic ethanol, bio-based chemicals, and development of technologies that use biomass for feedstock.

Last year, GraalBio announced the construction of a $146m biorefinery in Alagoas which will have a capacity to produce 22m gal/year cellulosic ethanol using sugarcane bagasse and straw for initial feedstock. The cellulosic ethanol plant, said to be the first in Brazil, is expected to start operations in early 2014.

For pretreatment and conversion of biomass, GraalBio has licensed the PROESA technology from Italy-based Beta Renewables – a join venture between Chemtex (a division of Italian plastic producer Gruppo Mossi & Ghisolfi) and investment firm TPG.

Chemtex will provide engineering services, equipment and technical field services to GraalBio’s facility. Danish firm Novozymes and the Netherlands-based DSM will provide the enzymes and industrial yeasts, respectively.

GraalBio is also developing a new type of cost-competitive biomass called Energy Cane, a cross hybrid of sugarcane varieties with selected types of grasses producing low sugar content but high fiber. An experimental site in Alagoas is expected to produce 100,000 Energy Cane seedlings (supposedly by the end of 2012). The company is hoping to achieve productivity target of 100 tons of dry mass/hectare.

In the biochemicals area, GraalBio said it hopes to build five facilities by 2017 for the production of biobased chemicals in Brazil using modified Brazilian yeasts.

BNDES said it is currently supporting 25 companies including GraalBio and Solazyme/Bunge in the implementation of 35 advanced biofuels business plans worth a total of Reais 1.5bn.