BASF Venture Capital, the subsidiary of the Ludwigshafen chemical giant that takes stakes in start-ups, is investing an undisclosed sum in LanzaTech, a US biotech firm headquartered in Chicago.

The US company has developed and deploys what BASF said is a “unique biotechnological procedure” for producing gaseous waste to feed chemical processes.

Using special microbes, the biotech’s patented gas fermentation technology enables ethanol to be produced from residual gases containing carbon monoxide and hydrogen. By using waste streams instead of incinerating them, industrial companies can reduce carbon dioxide emissions, BASF explains.

LanzaTech’s process is now being deployed at commercial scale in the steel industry, where carbon monoxide from off-gases can be converted into ethanol. The end-product can be used as a starting material for diesel, gasoline or jet fuel and as a feedstock for plastics and polymers.

Along with ethanol, the biotech’s portfolio includes other biochemical specialties and intermediates suitable for use as raw materials in otherchemical production processes. LanzaTech’s technology is also said to have potential for treating and recycling waste streams in the chemical industry as well as for treatment of municipal waste.

Markus Solibieda, managing director of BASF Venture Capital, said the “promising technology” enabling currently unused industrial residue and waste streams to be recycled will help it support its customers with chemistry that makes optimum use of available resources.

One component of the German group’s drive to increasingly integrate sustainability into all its business processes, Solibieda added, is investing in technologies that help to reduce carbon dioxide emissions.

 BASF’S capital input will help LanzaTech “realize its goal of a carbon smart future,” said CEO Jennifer Holmgren. Utilizing the chemical producer’s expertise in creating sustainable chemistry aligns with the Chicago company’s carbon recycling vision,” she said.