Shares of biofuel maker Solazyme Inc rose 15 percent in their stock market debut on Friday after the company's IPO raised more than expected. South San Francisco-based Solazyme uses algae to make oil and plans to sell fuel oil, dietary supplements and skin care products. It is the latest of a handful of companies that make fossil fuel alternatives and have sought money successfully from the US capital markets.
US crude oil prices have risen from under $40 per barrel in early 2009 to around $100 per barrel now. Political turmoil in the oil-rich Middle East and growing demand from developing economies threatens to keep those prices high. "Petroleum has no place to go but up," Solazyme Chief Executive Jonathan Wolfson said in an interview on Friday.
Solazyme's shares closed at $20.71 on the Nasdaq, well above their IPO price of $18. Shares of Gevo Inc and Amyris, which came public within the last year and whose businesses both also include biofuel production, closed on Friday at 32 percent and 83 percent above their respective IPO prices. If all goes as planned, Solazyme could sell diesel fuel for $4 per gallon or less, Wolfson said.
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