LS9 Makes Oil from Bugs at $125 a Barrel

LS9 has been called the leading company in developing fuel from synthetic bacteria.  Recently, the President of LS9, Robert Walsh, appeared for an interview on CNN and gave us some numbers.  Here is the money quote:

Right now, later this summer, we'll be making barrels a week of that. And 2010, we'll be making millions of gallons. And in 2011, hundreds of millions of gallons as we continue to scale up this process.

I think the other thing that's important is that right now this costs me $125 to make this a barrel. Our goal is to get to $50 a barrel so we can help everyone out.
If true, those are quite frankly some world changing statements. The next question of course is does the bacteria consume feed stocks to make petroleum?  According to Robert Walsh, they do not.
[O]ne of the things we have designed into this, the bacteria, that they can use nonfood feed stocks. It's actually agricultural byproducts, wood chips, wheat straw, rice straw, that are collected already. I think that's the big plus. You have to disconnect yourself from the food crop issue.

Also, you're not going to be able to drive economics without doing that, which is important for the consumer.
Amazing. Why is this not front page news? I don't know but The Times of London has a slightly more sober analysis:
The closest that LS9 has come to mass production is a 1,000-litre fermenting machine, which looks like a large stainless-steel jar, next to a wardrobe-sized computer connected by a tangle of cables and tubes. It has not yet been plugged in. The machine produces the equivalent of one barrel a week and takes up 40 sq ft of floor space.

However, to substitute America’s weekly oil consumption of 143 million barrels, you would need a facility that covered about 205 square miles, an area roughly the size of Chicago.

That is the main problem: although LS9 can produce its bug fuel in laboratory beakers, it has no idea whether it will be able produce the same results on a nationwide or even global scale.