Environment & Regulations

Biochemicals deals heat up

The first month of 2012 has seen some important announcement in a hot field. Andrew Warmington rounds them all up

There has been a burst of activity in the biochemicals and biofuels market in the past month, with deals between Genomatica and Novamont in bio-butanediol (BDO) and a merger between Green Biologics (GBL) and Butylfuel creating a major player in bio-butanol. Meanwhile, DSM has joined with POET in a joint venture to advane bio-ethanol for biofuels and Novozymes has formed an aliance to make biofuels from seaweed.

Genomatica, the US-based specialist in technologies to produce chemicals from renewable feedstocks, and Novamont, an Italian biodegradable plastics giant, have signed a definitive agreement establishing a joint venture to build the first industrial plant in Europe making BDO directly from renewable feedstocks. This follows on from an original letter of intent they signed last August.

Capacity at the site in Adria, Italy, will be about 18,000 tonnes/year and production, which was originally envisaged for late 2012, should begin in 2013. Novamont will purchase all of the output to use in its Mater-Bi brand of biopolymers that have BDO as a key monomer, though Genomatica has the right to use some to support further market development.

"Genomatica's BDO is the exact same chemical we've been using, and is the direct equivalent of petroleum-based BDO but with a smaller environmental footprint," said Novamont CEO Catia Bastioli. The two companies also plan a second BDO plant using Genomatica's process and biomass sugars as the feedstock.

Novamont will have a majority stake, though exactly what has not been specified. As envisaged in the original agreement, the two "will share in the earnings of plants according to specific terms between the companies". Novamont will pay for the costs of converting the facility to Genomatica's BDO process, while Genomatica will provide the basic engineering package, technology transfer and engineering support.

Separately, Genomatica has obtained exclusive worldwide rights to the Proesa process for the production of BDO from biomass via any fermentation-based process. The company said that integrating Proesa with its own direct biological process "will result in a complete, proprietary process for the second-generation manufacturing of BDO using non-food, cellulosic biomass as feedstock".

This is part of an agreement with Beta Renewables, a subsidiary of Italy's M&G Group, to produce BDO from biomass at demonstration scale at a facility in Rivalta Scrivia this year. Beta is currently building the world's largest cellulosic ethanol plant in Crescentino, Italy, for opening in mid-2012.

Novamont will convert its facility in Adria for bio-BDO production

This plant is designed to use Proesa to make sugars from non-food biomass, then ferment the sugars to make ethanol. Proesa is described as a second generation technology for using non-food energy crops or agricultural waste and turning them into fermentable sugars, ultimately enabling bioproducts to be made at lower cost.

Shortly after the original agreement with Novamont had been announced last August, Genomatica filed a registration statement for an IPO of its entire stock. It also announced in the same week that it had successfully produced of kilo quantities of butadiene from renewable feedstocks. This was its second product after BDO. The exact nature of the feedstocks used was not disclosed.

Butadiene, Genomatica noted at the time, "is one of the seven basic chemicals at the core of the chemical industry" with uses in tyres, engineering plastics and latex products. It is currently made mainly as a by-product of ethylene cracking but supplies have decreased. Consequently, prices have multiplied as the spread between natural gas and crude oil prices has widened, leading to reduced production of C₃ and C₄ chemicals. The world butadiene market is about 9 million tonnes/year, worth some $40 billion.

Meanwhile, GBL, a UK-based industrial biotechnology firm merged with Butylfuel of the US, which makes renewable chemicals and biofuels, as of 1 January. The combined firm will take the name Green Biologics and will be headquartered in Abingdon, UK, though it will keep its US office at Richmond, Virginia, and the pilot facility, laboratories and offices at Columbus, Ohio.

CEO Sean Sutcliffe said that this "creates a truly global leader in biobutanol and represents a transformational deal for both companies". The existing GBL was strongest in microbiology and fermentation and was present in China, India and Brazil, while Butylfuel was active in North America only, with strengths in bioprocessing and commercial scale-up. Butylfuel CEO Joel Stone will stay on as president for North America and global VP of engineering.

Checking butanol production from small scale cultures at Green Biologics

GBL will focus mainly on producing C₄ chemicals and advanced fuels from renewable feedstocks, primarily waste and by-product agricultural sources. In North America, this refers mainly to starch-based and cellulosic feedstocks, for which the company has already developed solventogenic Clostridia strains for use as biocatalysts. The main sources of feedstock in India and Brazil are cane and bagasse, while in China they are mainly molasses and corn by-products.

Last October, GBL had entered into a collaborative development and licensing agreement with Laihe Chemical, a Chinese company producing biofuels and biochemicals from non-food biomass resources.  Under this, they agreed to improve the economics of Laihe's biobutanol plant by optimising GBL's fermentation technology using sugars derived using Laihe cellulosic pre-treatment process. Full commercial production is expected this year. 

Butanol and its derivatives are described as key intermediates in the production of paints, coatings, adhesives and inks, a market worth about $85 billion/year worldwide. Opportunities are also seen as a 'drop-in' biofuel that can directly replace gasoline and be blended with diesel or other biofuels. Butyl acrylates are also widely used in plastics and polymers.

Prior to the merger, GBL had twice featured in the Global Cleantech 100 list, most recently last October. This focuses on private clean technology companies from all around the world, specifically those most likely to make the most significant market impact over the next five to ten years. According to Sutcliffe, the award had driven business to it from India, China and Brazil.

In early February, DSM and POET agreed a 50-50 joint venture called POET-DSM Advanced Biofuels, which will be based in Sioux Falls, South Dakota. This will demonstrate and license cellulosic bio-ethanol, which the two firms described as "the next step in the development of biofuels", based on their proprietary technologies.

POET-DSM will produce cellulosic ethanol from corn crop residue using enzymatic hydrolysis followed by fermentation. The first commercial demonstration will be at Project Liberty, a $250 million plant being constructed adjacent to POET's existing corn ethanol plant in Emmetsburg, Iowa. Initial capacity should be about 76 million litres, rising to 95 million.

POET is one of the world's largest producers of corn ethanol and has been developing cellulosic bio-ethanol for over ten years. Since November 2008, it has run a pilot plant at its research centre in Scotland, South Dakota, while also working with local farmers to gather residues such as cobs, leaves, husks and stalks from post-harvest grain for use as a raw material.

Corn and seaweed are the renewable raw materials for DSM's and Novozymes' new ventures

DSM's contribution to the venture is its expertise in both yeast and enzyme technology to boost conversion rates. It also has the experience in scaling up biotechnological processes and the scale to accelerate adoption of the technology.

Plans are to replicate and license the technology to additional plants to be built at the other 26 corn ethanol facilities in POET's network and license it to others. Estimates are that 350-400 new biorefineries will have to be constructed in the US by 2022 to meet the volume requirement of 60 billion litres/year of cellulosic bio-ethanol under the Renewable Fuel Standard.

The JV should begin production in 2H 2013. According to DSM, it should be profitable in 2014 and "deliver substantial revenues with above-average EBITDA contribution in the medium/longer term".

Danish enzymes specialist Novozymes has announced an exploratory research agreement with India's Sea6 Energy to develop a process for the production of biofuels from seaweed or macroalgae. They will use enzymes to convert seaweed-based carbohydrates to sugar, then ferment them using enzymes to produce ethanol for fuel, fine chemicals, proteins and plant fertilisers.

Sea6 Energy has already developed new ocean-farming structures that can replace antiquated methods of seaweed cultivation, potentially creating large-scale offshore farms. It is also pioneering approaches to fermenting the sugars derived from seaweed to produce fuel in a manner that requires minimal use of fresh water resources. The technology is being trialled with fishing communities around the coast of southern India.

Sea6 chairman Shrikumar Suryanarayan said that the new technologies could "offer a scalable and sustainable alternative to expensive and polluting fossil fuels, while providing employment to coastal communities and energy security for our country". Seaweed is seen as a highly sustainable raw material, as it is renwewable, does not require irrigation or fertilisers and does not use arable land. The climactic conditions around southern India make it an ideal location for this kind of cultivation.

Finally, some details have been released of a joint development agreement in plant-based polymers between Rhodia Acetow, a specialist in filter tow for cigarettes, and its French compatriot Roquette, a giant in starch. The initial focus appears to be in cellulose acetate and cellulose acetate fibre, a key raw material for Rhodia Acetow. Trials of starch acetate production are scheduled to begin shortly, with applications envisaged in paper, paint, dyes and pharmaceuticals.

From Online Issue: February 2012