A tree-living fungus that manufactures diesel fuel has been discovered in South America.
Experts believe the organism, Gliocladium roseum, could potentially be a completely new source of green energy.
The fungus, which lives inside the Ulmo tree in the Patagonian forest of South America, naturally produces hydrocarbon fuel similar to
the diesel used in cars and trucks.
Scientists were amazed to find that it was able to convert plant cellulose directly into the biofuel, dubbed "myco-diesel".
Crops normally have to converted to sugar and fermented before they can be turned into useful fuel.
Prof Gary Strobel, from Montana State University in Bozeman, US, said: "G. roseum can make myco-diesel directly from cellulose, the main compound found in plants and paper.
"This means if the fungus was used to make fuel, a step in the production process could be skipped."
Prof Strobel led an investigation into novel fungi in the rainforests of northern Patagonia, which cross the borders of Argentina and Chile.
He found that when the diesel fuel fungus was exposed to potentially toxic antibiotics, it reacted defensively by generating volatile gases.
"Then when we examined the gas composition of G. roseum, we were totally surprised to learn that it was making a plethora of hydrocarbons and hydrocarbon derivatives," said Prof Strobel. "The results were totally unexpected and very exciting and almost every hair on my arms stood on end."
The findings appear in the November issue of the journal Microbiology.
Cellulose provides the fibrous supporting structure of plants. During biofuel production, cellulose from plant waste is first treated with enzymes that turn it into sugar. Microbes then ferment the sugar into inflammable ethanol.
Nearly 430 million tonnes of plant waste is produced from farmland each year around the world.
Prof Strobel added: "The discovery also questions our knowledge of the way fossil fuels are made. The accepted theory is that crude oil is formed from the remains of dead plants and animals .
"If fungi like this are producing myco-diesel all over the rainforest, they may have contributed to the formation of fossil fuels."
