BOULDER - The National Renewable Energy Laboratory in Golden will be part of a project to help develop microbes that convert methane found in natural gas into liquid diesel fuel.

If successful, the approach could reduce greenhouse gas emissions and lower dependence on foreign oil.

The project received a $4.8 million grant from the Department of Energy's Advanced Research Projects Agency.

The University of Washington is taking the lead and focusing on genetically modifying the microbes. NREL will be in charge of fermentation to demonstrate the productivity of the microbes, both the natural organism and the genetically-altered varieties. NREL also will extract the lipids from the organisms and analyze the economic potential of the plan, according to an NREL press statement released Thursday.

A third partner, Johnson-Matthey of the United Kingdom, will produce the catalysts that turn the lipids in the methane into fuel. Illinois-based Lanza Tech, a pioneer in waste-to-fuels technology, has signed on to take the bench-scale plan to the commercial level, if it is successful.

"We'll be leveraging our decades of experience in producing biofuels and lipids, which in the past we've typically done via algae," said Phil Pienkos, NREL's principal investigator on the liquid-to-diesel project. "Here, we'll be applying it to a brand new feedstock, natural gas, which is recognized as being critically important to the United States."

The team will start with micro-organisms that grow naturally on methane, a component of natural gas, and which have a natural ability to make lipids from the methane. Unfortunately, the enzymes can't naturally produce enough lipids to make a project economically feasible, so they need some help from genetics. A goal of this project is to genetically engineer that microorganism to both increase the amount of membrane lipids and to get the microorganism to produce non-phosphorous-based lipids that are more readily converted to fuels.

The end product would be a fuel intermediate that then could be piped to a refinery for final processing into diesel or jet fuel. "It would be a good feedstock for a refinery," Pienkos said.