A success story: Ceres doing what most firms strive for; moving toward marketing of a product.

A cure for dependence on foreign oil grows in a greenhouse in Thousand Oaks.

For there in small pots are found rice and sorghum and switchgrass, all part of the efforts by Ceres Inc. to create plants that become alternative fuel.

Those efforts start in the labs with DNA sequencers and isolating genes for the desirable waits in the plants. When company President and CEO Richard Hamilton takes from a freezer a dish containing 134 tiny compartments containing DNA it is a scene that a generation or two ago would have existed only in science fiction but today is commonplace.

Around the corner from the freezer other box-like containers expose the seeds to conditions of extreme cold and heat.

Tinkering with plant genes delays the flowering time that results in larger, taller plants with thicker stems and bushier leaves with the ability to survive in a variety of soil conditions.

When eventually grown and harvested in fields in the Midwest and the South, the sorghum and switchgrass will end up in refineries to become biofuel.

"We are not harvesting seeds," Hamilton said. "We are harvesting biomass."

In the life sciences, it takes a lengthy lead time to bring product out of the lab and into practical everyday uses.

Ceres is closer to that stage than most other biotech firms found in the 101 Corridor; sprouting as it were from an incubator at UCLA to the development stage to the commercialization stage.

The company expects to have switchgrass seeds ready for planting in 2009 with sorghum seeds to follow in 2010.

Processing facility

The plants coming from those seeds carry little value if no refinery exists to make them into biofuels. So Ceres joined with ICM Inc., a Kansas company building a 1.5 million gallon processing facility near St. Joseph, Mo. with funding from the U.S. Department of Energy.

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The processing stage shows the importance of high yield plants such as the ones developed in the labs at Ceres. Larger plants produce more biomass. And more biomass easily satisfies the demands of a processing facility.

A 100 million gallon refinery, for instance, needs 5,000 tons of biomass a day, Hamilton said.

In addition, growing larger plants nearby to the refinery cuts transportation costs.

The most familiar of biofuels is ethanol made from corn starch. Ceres engages in cellulosic biofuels that come from the cell wall of switchgrass, sorghum and miscanthus.

Starting with the test plant arabiposis, Ceres tests its genetic material. More tests are conducted on rice plants before the material gets inserted into the energy crops.

As switchgrass is a wild crop, a weed, Ceres makes the plant commercially relevant, said Scott Kohl, the technical director for ICM.

Just as breeding improves the yield of corn, the same can be done with energy crops, Kohl said.

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"The potential to improve is quite logical," Kohl said.

UCLA startup

Ceres--named for the Roman goddess of agriculture and growing plants--got its start in 1997 at a UCLA incubator, later moving to Malibu before settling in Thousand Oaks four years ago.

In those early years biomass and biofuels were not the intended path. Instead, the company's founders were more interested in taking the technology used in the Human Genome Project and apply it to plants.

"I think early on there wasn't more of a vision than that;" Hamilton said.

When the opportunity to create energy crops presented itself, the company ran with it. Strategic collaborations then followed with world-class universities, Monsanto and the Samuel R. Noble Foundation.

ICM looked at every part of Ceres before taking the company on for its pilot refinery project. The firm has good technology, an extremely good set of skills to develop row crops that can apply to switchgrass and was further along in its seed development.

"There are a lot of things that go into a successful partnership," Kohl said. "Technology is only part of it."

At South Dakota State University, Ceres funds research into developing switchgrass adapted to northern latitudes.

The research combines Ceres's biotech industry expertise with the university's germplasm base for genetics and breeding, said Kevin Kephart, vice president for research and dean of the graduate school.

Funded through venture capital firms and private investors, the latest round of money brought $75 million for capital expenditures and general corporate purposes. Warburg Pincus led the late-stage financing.

In January, the Los Angeles Venture Association named Ceres as its best venture financing in clean technology.

By MARK R. MADLER

Staff Reporter