2011 Annual Report 1a.Objectives (from AD-416) Identify genomic basis and relationships between enhanced inhibitor tolerance and efficient heterogeneous sugars utilization derived from lignocelluolosic biomass; engineer tolerant Saccharomyces cerevisiae NRRL Y-50049 for improved and balanced utilization of pentoses and hexoses from lignocellulosic hydrolysates. 1b.Approach (from AD-416) Comparative genome sequence analysis will be carried out to underline genetic fundamentals of the tolerance and in situ detoxification of the biomass conversion inhibitors. Comparative genome expression analysis will be carried out to establish gene regulatory networks involving tolerance and heterogeneous sugar utilizations including pentoses and hexoses. Genetic engineering will be carried out to incorporate heterogeneous genes into the tolerant Y-50049 for improved pentose utilization. 3.Progress Report During March 1-2, 2011, in conjunction with the 8th United States Department of Agriculture (USDA)-Ministry of Science and Technology (MOST) Joint Working Group Meeting in China, a scientist from USDA visited the Qingdao Institute of Bioenergy and Bioprocessing Technology (QIBEBT), Chinese Academy of Science, and reviewed progress and comprehensive data with the QIBEBT team. Following the review, a research plan of the next phase was developed for data verification and analyses using more sophisticated computational programs. Following this direction, data obtained from the Solexa reads were further filtered and trimmed to generate high quality data with an average quality > 25 for more than 75% of sequence reads. Then, high-quality Solexa paired-end reads were assembled using Velvet (v0.7.63), with the bowtie-mapping results as a guided reference. The final Y-50049 genome assembly contains 6,747 contigs with 80,386 N50 (bp); the Y-12632 genome assembly includes 6,441 contigs with 79,676 N50. Currently, scientists from both agencies are working closely on biological interpretations for yeast stress tolerance in association with the sequencing data. The Authorized Departmental Officer's Designated Representative (ADODR) monitored the activities of this agreement via teleconferences, frequent e-mail contacts, and an occasional visit.