AlgaEnergy, a company owned by Spanish firms Repsol and Iberdrola, is in discussions with potential partners to build a biomass plant in Mexico that would supply Latin America with gas derived from algae.

The goal of AlgaEnergy (part-owned by Spain’s Repsol and Iberdrola) is to find partners in order to build a million liter biomass gas plant that runs on algae. The firm wants to get a foothold in Mexico and use this as a base from which to expand in Latin America and the United States.

Microalgae use sunlight, water and carbon dioxide to produce oxygen and biofuel through photosynthesis. The algae can be cultivated in facilities that use marginal land with open ponds or bioreactors, which protect them from contamination and maintain a constant temperature in order to allow for large-scale production.

The International Energy Agency estimates that biofuels could provide close to 27% of the fuel requirements for the entire world’s motors by the year 2050, compared to only 3% in 2012. This would help to reduce dependence on crude oil as well as cut greenhouse gas emissions.

AlgaEnergy is also set to begin operations at its plant in Arcos de la Frontera in the south of Spain, which has an initial capacity of 350,000 liters.