UC Signs BP Contract, Research Already Underway

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Berkeley Daily Planet (California)

The $500 million pact between UC Berkeley and one of the world’s largest oil companies went into effect Wednesday, though research covered by the contract started months ago.

The grant may be the largest single corporate funding of academic research in history.

BP will fund both academic and corporate researchers at UC Berkeley, Lawrence Berkeley National Laboratory (LBNL) and the University of Illinois at Urbana-Champaign.

While the last signature was gathered only this week, actual work began perhaps as early as in June. Funded by the British oil company, UC Berkeley has already sent researchers to Africa and India in search of crops and places to plant them.

UC Regents voted in March to build a new research facility to house the Energy Biosciences Institute (EBI), BP‘s chosen name for the project that university officials described as “the first public-private institution of this scale in the world.”

But the final sign-offs on the research project took eight more months to win, including the clearances of campus, the University of California, corporate and governmental officials.

The agreement officially runs from July 1, 2007 through June 30, 2017 unless Berkeley and its partners chose to end it earlier because they determine “continued association with EBI was not in accord with its fundamental principles.”

The university can also opt out if there is a change of control at BP. And BP can withdraw at any time after July 1, 2010, if the company determines the project is no longer technically or commercially viable.

The agreement will provide “at least” $35 million a year for open research at the public institutions, with initial funding of $17 million through Dec. 31. Funding of $10 million is due within 30 days of the signing.

Initially, research will be conducted in Calvin and Hildebrand halls on the UC Berkeley campus, moving to the specially-created Helios Building at LBNL when it opens in 2010.

BP will lease space for its own proprietary, controlled-access research lab, to be housed initially in the third floor of Calvin Hall, a building earmarked for demolition to make way for the university’s Southeast Campus Integrated Projects.

The oil company will pay an annual rent of $101,322, with a provision for a 5 percent annual increase.

The project will involve a wide range of academic disciplines, and program officials have already solicited and received proposals from faculty at both universities and the lab.

Proposals in

According to a statement by the university released Wednesday, the initial call for pre-proposals produced more than 250 responses from the three institutions.

“About 85 pre-proposals were subsequently invited to submit a full proposal, and they are currently being evaluated. Awards are expected to be announced this fall, and another round of proposals will be solicited in spring 2008,” according to university spokesperson Robert Sanders.

“We are very pleased that the institute’s journey to develop new, cleaner sources of energy has begun,” Somerville said in a prepared statement. “Our mission is to harness the potential of bioenergy, to make discoveries and to help them become commercially viable so they can benefit the world. The institute will also examine the social, economic and environmental implications of using cellulosic biofuels to meet a significant proportion of the earth’s energy needs.”

Cellulosic fuels are derived from plant fiber, rather than the more easily recovered sugars harvested from the crops like soybeans and corn for production of ethanol.

EBI will also look into engineering microbes to create new fuels from coal and to recover oil from depleted wells, according to the grant proposal. Another phase of the program will look at discovering new ways to capture and sequester CO2 from the atmosphere.

While the university has portrayed EBI as a program designed to make the United State independent by using marginal croplands to grow non-food plants for fuel, BP Chief Scientist Steve Koonin told the USEA that the company’s goal is a program that creates crops focused on tropical climates, though research will also develop plants for all climate zones.

A nuclear physicist, Koonin spearheaded the process that led to the choice of Berkeley among five company-selected candidates. He is currently on leave from his post as provost and intellectual property manager for the California Institute of Technology.

BP is the company known for decades as British Petroleum.

The master agreement and other documents are available on the university’s Internet site by clicking here.

Critics of BP and its role on campus have charged that the company’s plans to use genetically modified plants and microbes threaten Third World countries, which are least able to resist the intrusions of multinational corporations.

Control questions

John Simpson of the Foundation for Taxpayer and Consumer Rights (FTCR) said he was particularly concerned because the contract gives BP more control of the EBI and research than envisioned in the original proposal.

In its original and winning proposal, Berkeley proposed creating a governance board that would give three seats to representatives of public institutions and two to the oil company. But the final contract gives four seats to each, leading to potential ties.

BP can thwart any action they wish,” said Simpson. “And given the despicable record of BP, which killed 15 of its workers in Texas and spilled oil all over Alaska because of unreasonable cost cutting, why should we believe the oil giant would act in good faith? They have demonstrated time and again that they act only in their own narrow interest.”

The board can hire and fire the EBI‘s director and deputy director, but it can only vote up or down on the entire slate of research projects proposed by EBI‘s executive committee.

The executive committee is composed of nine members, with eight from the public bodies. The chair is Somerville, with UIUC’s Steve Long as deputy director. BP has one representative on the nine-member committee, Paul Willems, BP Technology’s Vice President of Energy Biosciences.

The public institutions have agreed to grant BP a non-exclusive, royalty-free license to patent rights, and up to 180 days, if needed, to negotiate for exclusive rights on an invention developed by public researchers or in public/BP collaborations. The company can also negotiate for a time-limited option period of up to a year (with additional extensions possible).

Before public researchers are allowed to copyright, publish or otherwise disseminate their findings, they must be submitted first to BP at least 30 days before release to allow the company to see if any of BP‘s proprietary information has been included and to see if BP wants the researcher to file a patent application — which would add up to another 60 days before publication.

For exclusive rights to non-proprietary research patents BP opts to exploit, the agreement caps basic payments at a maximum of $100,000 a year, though larger amounts could be negotiated. If other patents are determined to be “substantially similar,” they would also be licensed at no additional cost to the company.

The company also retains the option to license software created under the agreement. In biotechnology, computer programs play an increasing role in project development and can also be expected to play critical roles in the operation of any plants or factories exploiting the technology developed by EBI.

BP also receives royalty free rights — if possible — to use any “background inventions” or software created by public researchers and used to create new inventions under the EBI research agenda, with per-patent payments capped at $20,000 for one invention or $50,000 for multiple inventions needed to develop a product.

Asked for a comment on the announcement of the signing, UC Berkeley Microbiologist Ignacio Chapela responded, “Very little else to note for the moment. Perhaps only to note the genius of whoever named the file of the agreement signed: it is called ‘Final Execution’.”

The title refers to the document posted on the university’s website.


Members of the public will be able to review plans for the Helios Building and a second structure being planned at LBNL during the Dec. 12 meeting of the city Planning Commission.

LBNL officials will make a presentation from the draft environmental impact reports on the two buildings during the meeting, which begins at 7 p.m. in the North Berkeley Senior Center, 1901 Hearst Ave.

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