Celunol Awarded Department of Energy Grant for Cellulosic Ethanol Process Technology

CAMBRIDGE, Mass.
March 28, 2007

Celunol Corp., a leader in the development of cellulosic ethanol, announced today that it has been awarded up to $5.3 million by the U.S. Department of Energy (DOE) for a research program aimed at developing further improvements to the company's cellulosic ethanol fermentation process technology.

"This award is a validation of the substantial progress we have made to date in developing highly effective processes for the production of cellulosic ethanol," stated Carlos Riva, chief executive officer of Celunol Corp. "This grant will help to support important initiatives for the continued development of Celunol's process technologies. With our pending merger with Diversa, we are creating a world-class team with what we believe are the broadest capabilities in the industry to effectively address the cost-effective production of cellulosic ethanol."

The work to be performed under this grant will be focused on enhancements to two organisms that are central to Celunol's existing cellulose-to-ethanol process. These include a strain of the Klebsiella oxytoca bacterium and a strain of the Escherichia coli bacterium that were developed by Dr. Lonnie Ingram and his coworkers at the University of Florida who were the first in the world to develop genetically engineered bacteria capable of converting all sugar types found in plant cell walls into fuel ethanol. Ingram's organisms produce ethanol from a variety of different types of biomass. Celunol holds the exclusive rights to use and license the engineered bacteria for the production of fuel ethanol. Research performed under the DOE's grant is to be conducted by a team led by Celunol and will include members from Diversa Corporation; Professor Lonnie Ingram at the University of Florida; Professor Gregory Stephanopoulos at Massachusetts Institute of Technology; and Genomatica, Inc.

According to the Department of Energy, projects were selected for the funding based on organisms' capacity to convert lignocellulosic biomass to ethanol in process-relevant conditions that would be economical in the commercial market. Additionally, the organisms must be able to survive a wide range of environmental conditions and remain stable from adverse mutation. Selectees must have the ability to produce at commercial scale in the future and have a sound business strategy to market the organisms.

Celunol expects that enhancements to the fermentation organisms used in the company's process will be applied in its recently-upgraded pilot plant located in Jennings, Louisiana, in a 1.4 million gallon per year demonstration plant now in construction at the same site, and in commercial-scale facilities it expects to construct in the future.

On February 12, 2007, Celunol and Diversa (NASDAQ:DVSA) entered into a merger agreement with Celunol Corp. pursuant to which a wholly-owned subsidiary of Diversa will merge with and into Celunol, with Celunol as the surviving corporation, becoming a wholly-owned subsidiary of Diversa. The proposed merger transaction is subject to customary closing conditions, including receipt of certain regulatory approvals and the approval of the stockholders of Diversa and Celunol. For more information about Diversa, please visit www.diversa.com.

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. For more information on Celunol, visit www.celunol.com.