The U.S.s global leadership position in the manufacture of high value chemicals (HVCs) relies on its ability to produce and utilize simple and useful organic (SUO) building block chemicals, a $400 billion a year enterprise based on nonrenewable petroleum feedstock. To maintain U.S.s leadership position in the 21st century, we must seek alternate renewable and economically competitive sources for making HVCs that are used in polymers, medicines, advanced materials, and flavor and fragrance applications. Lignin, a natural biopolymer of monomeric phenol subunits, is a rich source of aromatic building block chemicals. Current biorefinery strategies primarily focused on valorization of cellulose and hemicellulose fractions of biomass because of lack of selective catalyst for lignin conversion. As a result, millions of tons of lignin generated by biorefinaries have been underutilized for generating electricity. Spero Energy will develop an effective technology for one-step delignification of wood biomass and selective conversion of lignin constituent into high value dihydroeugenol and 2,6-dimethoxypropylphenol. Methoxypropylphenols are flavor and fragrance chemicals with global production of dihydroeugenol exceeding 30 million pounds annually at a market value of 450 million USD and have an average annual market growth of 25% (as per 2009 market report). Currently these chemicals are manufactured via multi-step processes using environmentally hazardous chemicals and petroleum feedstock. In this context, our process meets the objective of U.S.DOE in producing green products from biomass derived intermediates. Additionally, our technology will provide an effective protocol for the production of reactive cellulose and hemicellulose fractions for fermentable sugar in the same step of methoxypropylphenols production without using any hazardous chemicals. Biomass pretreatment is one of the most expensive processing steps in cellulosic biomass-to- fermentable sugars conversion with cost as high as $0.3/gallon. Because of high volume of fermentable sugar production, commercialization of our technology will add significantly higher economic benefit than that for dihydroeugenol production alone. Three key scientific objectives of the proposed SBIR phase I are as follows: (1) Demonstrate delignification of wood biomass with varying lignin variants (G versus S lignin) and control in selective production of one of the two methoxypropylphenols on 100 g scale. (2) Establish catalyst recovery, lifespan and regeneration. (3) Show cellulose residue (obtained from step 1) can easily break apart to fermentable sugar than the intact wood. Spero Energy. Inc. estimates licensing and sales revenue of $ 2.9 million during the first 3 years of licensing to the technology to biorefinery and flavor/fragrance manufacturers with target methoxyphenols production of 2 million kg and fermentable sugar production of 2 million gallons.