More than two years after Exxon Mobil Corp. Chairman and CEO Rex Tillerson famously characterized biofuels as "moonshine," the company has launched a program that could turn the so-called swill into future profits.

Exxon formed an alliance in July with biotech company Synthetic Genomics Inc. to research and develop biofuels from photosynthetic algae.

The company expects to spend more than $600 million to convert algae into fuels. Exxon decided to explore algae over other fuel sources because it has a higher yield potential and wouldn't require significant infrastructure investments, said Emil Jacobs, vice president of research and development at Exxon Mobil Research and Engineering Co., in a July 14 statement.

"After considerable study, we have determined that the potential advantages and benefits of biofuel from algae could be significant," Jacobs said. "Among other advantages, readily available sunlight and carbon dioxide used to grow the photosynthetic algae could provide greenhouse-gas mitigation benefits. Growing algae does not rely on fresh water and arable land otherwise used for food production. And lastly, algae have the potential to produce large volumes of oils that can be processed in existing refineries to manufacture fuels that are compatible with existing transportation and technology infrastructure."

This new direction seems to be an about face from the comments Tillerson made during the CERAWeek energy summit in February 2007 when he reportedly said, "I'm not an expert in biofuels. I'm not an expert in farming. I don't have much technology to add to moonshine."

At the time, Tillerson was viewed as less abrasive than former chief executive Lee Raymond, who retired in 2005 and was vilified by environmentalists for his global-warming skepticism.

Exxon Mobil Corp. At A Glance Exxon Mobil Corp. Irving, Texas Primary Industry: Petroleum & Coal Products Number of Employees: 79,900 2008 In Review Revenue: $466.3 billion Profit Margin: 9.70% Sales Turnover: 2.05 Inventory Turnover: 24.98 Revenue Growth: 17.85% Return On Assets: 18.68% Return On Equity: 37.14%

The company's recent foray into algae research should reinforce some of those initial impressions, although staunch environmentalists will remain cynical. (Earth First.com said Exxon is "still not green, and it's highly unlikely that they ever will be. Now the question is, how long before we're bombarded with Exxon ads proclaiming their greenness for making this investment?")

But Tillerson and his executive team have been making their voices heard over the past few years about the company's ongoing sustainability efforts.

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