Researchers from Montana State University have discovered a fungus in the rainforest of Patagonia that makes diesel compounds from cellulose.
The fungus, Gliocladium roseum, lives inside the Ulmo tree. (Sounds like a Lewis Carroll poem.) It churns out hydrocarbons and hydrocarbon derivatives, which lead author Gary Stroebel has called "myco-diesel."
Producing these compounds directly from cellulose on a large scale could be a game-changer for the biofuels industry.