Celunol Marks Groundbreaking for Nation's First Demonstration-Scale Cellulosic Ethanol Facility

JENNINGS, LA
February 16, 2007

Celunol Corp., a privately-held company and leading biofuels technology developer based in Cambridge, Massachusetts, officially broke ground this morning on a new demonstration-scale cellulosic ethanol production facility, located at its Jennings, Louisiana site, with a rated design capacity of 1.4 million gallons per year (MGY). Joined by dignitaries from federal, state and local government, as well as several project partners and suppliers, the company also celebrated the completion of its pilot cellulosic ethanol facility, the first in the nation.

"These two milestones mark a significant step forward for Louisiana and our nation," said Governor Kathleen Babineaux Blanco. "Cellulosic ethanol represents a new way to pursue the goals of increased energy security and economic development for our rural economy, while protecting the quality of our environment. We congratulate Celunol and its partners on these milestones, and look forward to the growth of this promising new industry here in Louisiana."

"It has become clear that we need to look to new feedstocks and technologies to increase the sources of supply of ethanol to meet the nation's rising demand for clean automotive fuel," said Carlos Riva, Celunol's President and CEO. "The pilot plant we have inaugurated here illustrates the technical feasibility of producing ethanol on a high-yield basis from low-cost crops and agricultural residues. We expect that the demonstration facility we are constructing will validate the economics of this process on a much larger scale. We believe that a successful demonstration here in Jennings will mark the last major step before the full-scale commercialization of this exciting new technology can begin."

About Celunol
Celunol Corp., headquartered in Cambridge, Massachusetts, is moving rapidly to commercialize its proprietary technology for producing ethanol from a wide array of cellulosic biomass feedstocks including sugarcane bagasse, agricultural waste, wood products and dedicated energy crops. Celunol holds exclusive rights to employ key technology developed at the University of Florida in the early 1990s for the production of fuel ethanol. The company aspires to develop and build a portfolio of cellulosic ethanol and other biomass facilities in the U.S. and abroad. Celunol has recently completed upgrades to its pilot-scale cellulosic ethanol plant in Jennings, Louisiana, which is one of the first such facilities in the nation. The company is currently constructing a demonstration-scale cellulosic ethanol facility at the same site with a design production capacity of 1.4 million gallons per year. Celunol has also licensed its technology to Marubeni Corporation and Tsukishima Kikai Co., LTD for facilities built in Japan and certain other Asian countries. Pursuant to this license the company's process technology has been incorporated into Bioethanol Japan's 1.4 million liters-per-year cellulosic ethanol plant in Osaka, Japan - the world's first commercial scale plant to produce cellulosic ethanol from wood construction waste. On February 12, 2007 Celunol and Diversa Corporation (Nasdaq: DVSA), a leader in the development of high-performance specialty enzymes, announced that they have entered a definitive merger agreement.For more information on Celunol, visit www.celunol.com.

About the Demonstration Facility
Celunol's demonstration facility is the first facility of its kind in the United States to enter the construction phase. The plant will be designed and constructed to have an annual rated capacity of 1.4 MGY of ethanol and to make use of locally-grown sugarcane bagasse and specially-bred energy cane. It will use Celunol's patented production process, which employs a combination of microorganisms and specialty enzymes, to convert up to 95% of available sugars in biomass feedstocks into fuel ethanol. The project is designed by the U.S. subsidiary of AMEC, a worldwide provider to the world's infrastructure, manufacturing and process industries (www.amec.com). It is to be constructed by Cajun Constructors, a nationally recognized leader in construction services (www.cajuncontractors.com). The plant is planned for completion before the end of 2007.

About the Pilot Facility
Celunol's newly-expanded pilot facility is the first cellulosic ethanol facility in the nation, and is capable of producing ethanol from both the C5 (hemicellulose) and C6 (cellulose) sugars available in biomass feedstocks. Constructed for use as a research and development facility, the plant will be used to test Celunol's patented, high-yield process on a wide variety of feedstocks including canes, grasses and woodchips.