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Virent’s New CEO Talks Tesoro Purchase, Company Culture, and More

Xconomy Wisconsin — 

Last week, Virent, a Madison, WI-based developer of biofuels that are designed to replace crude oil, announced it had hired Stacey Orlandi to serve as the company’s next chief executive.

Virent says its base technology can help produce cleaner and more sustainable versions of liquid transportation fuels, including gasoline, diesel, and jet fuel. The 40-person company also makes bio-based paraxylene, a plant-derived form of the chemical that can be used to make packaging containers, fabrics, and other items.

In September, the San Antonio-based petroleum refiner Tesoro (NYSE TSO) acquired Virent for an undisclosed amount. Under the terms of the deal, Virent now operates as a wholly owned subsidiary of Tesoro.

Orlandi, whose previous career stops include stints at Royal Dutch Shell and BP (NYSE BP), recently spoke with Xconomy about Virent’s product mix, how it feels to be working at a small—or at least smaller—company, and other topics. Our conversation has been edited for clarity.

Xconomy: Can you start by talking about your background and what led up to your decision to join Virent?

Stacey Orlandi: I’ve got a little over 20 years of experience in the oil, gas, and energy industry, largely split between technology development and manufacturing leadership roles. My last role was at Shell as the vice president of one of the research and development divisions that developed novel processes for the new energies industry and for the chemicals industry. It’s a background that’s well aligned for this type of role.

I think for me, [Virent represents] a unique opportunity to be part of the final stages of commercializing a biofuels technology and being able to really lead the end-to-end process, rather than one slice of a process where you’ve got multiple divisions that are at play, which you’d have in all the larger corporations.

X: Would it be correct to say that Virent has two primary divisions, one being transportation fuels and the other being plant-derived chemicals that can be used to make a number of items commonly found in peoples’ homes and workplaces?

SO: It’s less that Virent has two divisions, and more that the core technology that Virent invented can make both fuels and feedstocks that go into chemicals [and] ultimately get converted into packaging and fibers. The [single] technology platform can produce both products, depending on how you set the design. You can flex the design of one plant, one manufacturing facility, to produce both chemical feedstocks and fuels for transportation.

X: But as far as you know, following Tesoro’s acquisition of Virent, has there been more emphasis on fuels than on chemicals?

SO: I’m only on day three [at Virent], but my experience in doing technology development in both Shell and in BP, at different stages, is that the economics will tell the story of what the optimal product slate is to make—whether that’s the chemicals, the feedstocks, or the fuels products.

And I think those can change depending on the price of oil and the baseline price for the chemicals market … basically, the price of [Renewable Identification Numbers] under the [EPA’s Renewable Fuel Standard program] standard in the U.S. regulations, as well as the low-carbon fuel standard under California Carbon.

[Virent is part of a] consortium that has players who are interested both in fuels (like Tesoro) but if you look at Coca-Cola (NYSE KO) and [Japanese plastics maker] Toray, [they’re] interested in the chemicals and feedstocks. So at the end of the day, when you start to look … Next Page »

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