The broader impact/commercial potential of this Small Business Innovation Research (SBIR) project will be a fermentation-based technology capable of converting abundant American natural gas supplies into valuable building-block chemicals that will advance economic and security interests while encouraging innovation in manufacturing. This project focuses on engineering microorganisms that can convert natural gas into green chemicals via fermentation. Natural gas is the least expensive raw material available for chemical production. The use of this inexpensive raw material will open up multi-billion-dollar fuel and chemical markets for green manufacturing methods that have been previously disregarded as unprofitable. Commercialization of these projects will increase innovation, investment, and job growth in the clean technology, manufacturing, and construction industries. If successful, natural gas-based fermentation technology will reduce carbon pollution; a lifecycle analysis for production of a target chemical shows a six-fold reduction of carbon dioxide emissions compared to the current petroleum and coal process. Finally, this project aims to discover new enzymes that may find applications in treating hydrocarbon spills in the environment.<br/><br/>This SBIR Phase I project proposes to engineer an ethane-consuming pathway into an industrial microorganism in order to reduce the cost of manufacturing chemicals. The solution centers on identifying ethane-oxidizing enzymes from environmental DNA samples. The vast majority of bacteria have never been cultured, but recent technological advances now allow millions of previously unknown DNA fragments to be extracted from diverse environments and tested. Screening environmental DNA samples for novel functionality has identified new pathways to bio-based chemicals. This proposal outlines a selection-based strategy to enrich a large library for enzymes that can oxidize ethane. The outcome of our Phase I research will be the world's first industrial strain engineered to grow on ethane. This strain will serve as a platform for: (1) accelerating the growth rate on ethane, using directed evolution, (2) producing industrial products, including a valuable four-carbon building block chemical, and (3) developing a pathway that consumes methane. This powerful selection scheme could lead to the discovery of entirely new classes of enzymes, which may function via novel catalytic mechanisms. Successful, functional expression of such an enzyme in a well-studied strain would accelerate biochemical characterization of these fascinating and complicated enzymes.