Audi is betting on a Paris-based startup that makes low-cost gasoline from sugar and other renewable resources. The strategic deal with Global Bioenergies includes an unspecified sum of funding and stock options, according to MIT Technology Review.

The technology of Global Bioenergies uses microorganisms to ferment sugar and produce fuel. Its process skips the distillation step, which is the second most expensive part of manufacturing biofuels, the report noted.

The French startup has genetically modified E. coli bacteria to produce the gas isobutene in a way that the fermentation tank does not reach toxic levels. Through this method, the said bacteria can continue to produce fuel longer than in the traditional method. Thus, the output of a facility is increased and the capital cost is decreased, the report explained.

Audi's team-up with Global Bioenergies is part of the car maker's overall strategy to decrease greenhouse gas emissions amid stricter regulations, MIT Technology Review reported.