BioNexus Status is a recognition awarded by the Malaysian government to qualified companies that participate in and undertake value-added biotechnology activities. To date, 187 companies, 10 with U.S. shareholding, have been granted BioNexus Status.

According to GlycosBio CEO Richard Cilento, there are several requirements companies have to meet in order to gain the status. “You have to be a provider of services or products based on either life sciences or industries that substantially utilize biotechnology processes,” he said. Qualified companies also have to make a commitment to research and development activities and ensure a significant percent of its employees are “knowledge workers,” as opposed to laborers. Selected companies are also required to commit to comply with all applicable laws, regulations and guidelines. They must also establish a separate legal entity based in Malaysia.

The financial benefits of BioNexus Status are impressive, Cilento said. While the government of Malaysia typically maintains a portion of ownership, up to 30 percent, in companies located within the nation, those with BioNexus Status are given a commitment to have freedom of ownership, he said. This means that GlycosBio is able to maintain 100 percent ownership of its Malaysian projects. In many instances, the government may also limit from where a company can secure funds, customarily requiring that working capital dollars are sourced within Malaysia. However, BioNexus Status companies are given the freedom to source funds globally, Cilento said.

BioNexus Status companies also receive important tax benefits. For a period of time, Cilento said they are given tax exemptions on profits and distributed dividends. “In certain cases, exemptions [are also made] on import duties and sales tax for raw materials and machinery,” he continued. “The concept of exemption of import duties and sales tax is quite significant.” In some instances, Cilento said BioNexus Status companies are also allowed to take double deductions on expenditures incurred on research and development activities.

“We are honored that BiotechCorp has granted GlycosBio with the esteemed designation of BioNexus Status and proud to join this elite group of companies,” said Cilento. “The BioNexus Status demonstrates the benefits of a collaborative effort between private enterprises and the strategic objectives of the Malaysian government. Having the support of BiotechCorp and working closely with their dedicated professionals has proven to be a key differentiator for GlycosBio and the emerging biochemical value chain we are supporting.”

By Erin Voegele

While America leads in innovation and technology development, scaling up those processes overseas is often an attractive option for domestic companies. There are many reasons for this, including a lack of incentives in the U.S., lower construction and operational costs, greater feedstock availability and access to downstream markets.

It is important for these companies to understand that no matter where they choose to site projects—whether in North America, Southeast Asia or Brazil—they will encounter different sets of benefits and challenges. Each region is unique. Local customs, political environments, laws, regulations and resources all need to be addressed in order to develop a successful project. For many companies, the formation of local partnerships seems to be the most advantageous way to navigate the complexities of these markets.

Each biorefining company is unique, and each has its own set of factors to consider when siting a project. BioAmber Inc. is currently finalizing the site for a North American plant and is in discussions with a consortium to construct another in Southeast Asia. “These are firm projects that are underway,” says J.F. Huc, BioAmber’s president and CEO, noting that his company is also exploring the possibility of building a plant in South America.

According to Huc, BioAmber looks at four primary factors when scouting locations for a plant. First is the cost to serve customers. This includes feedstock, utility and final shipping costs. “Tied closely to the supply chain is feedstock availability,” he says. “The more abundant the supply of feedstock, or the variety of feedstocks available, the more likely you are to manage the cost of your raw materials. In places like Thailand, being able to switch from sugarcane to tapioca gives you a hedge against a sharp spike in one or the other.”

“The second very important consideration for us is local partners,” Huc says, adding that he believes it is necessary to find local partners who can access the best labor pools and subcontractors, oversee the engineering and construction of the plant, operate the plant effectively and contribute to feedstock security. “That is particularly important in places like Brazil, where you have large, integrated sugarcane producers.”

Third is government support for nondilutive funding. This doesn’t necessarily mean access to grants, but includes the availability of financing mechanisms like low-interest loans and loan guarantees to help defray the cost of capital, Huc says.

The final consideration for BioAmber is what Huc calls the specificities of the site. This includes proximity of infrastructure, including electrical service, truck weighing stations, rail spurs, and waste water management systems. “These are all things that often will be pre-existing on a site and can significantly reduce your initial capital expense,” he says.

NatureWorks LLC has its own unique set of considerations, and is actively vetting sites for additional production capacity. Market demand for the company’s Ingeo bioplastic has been growing by approximately 25 to 30 percent a year, says Steve Davies, NatureWorks’ director of marketing and public affairs. Current projections indicate that the entire capacity of the company’s Nebraska plant will be sold within the next three years, making it necessary to construct additional capacity to meet demand. A new location will have to be chosen for this capacity by midyear in order for the additional capacity to be brought online in the 2014-‘15 timeframe. NatureWorks is currently exploring options in both North America and Southeast Asia. While Davies stresses that additional production is highly likely to be installed in both regions in the future, the decision where the first expansion takes place is expected to be based, in part, on locally available incentives.

NatureWorks looks at three primary factors when considering locations for a plant, Davies says. No. 1 is the availability of feedstock—not just feedstock currently employed by its process, but also the availability of lignocellulosic feedstock for future use. “The second is the extent to which an end market exists in a region,” he continues. “Third is, of course, regional incentives, what’s being offered and how interested is that country or region in getting into the biochemicals business.” A variety of secondary factors also considered includes energy costs, logistics, workforce availability, trade structure, and import and export duties.

Partnering for Success

Once a location is chosen for a new plant, most biorefining companies seem to be making it a priority to find reliable local partners. Glycos Biotechnologies Inc. is in the process of developing a plant in Malaysia. In fact, the company had a team on the ground in January working to hire a construction partner.

Malaysia is a very friendly environment to develop this type of project, says GlycosBio CEO Richard Cilento. “The government really has a long-term business plan—or strategy—to bring in new technologies and new industries into the country.” GlycosBio has formed a partnership with two government corporations, the Malaysian Biotechnology Corp. and Bio-XCell, to help expedite development of its plant. While these corporations will not have any ownership in the project, Cilento notes they have been invaluable in helping the project succeed.

These government corporations have formed an industrial biotechnology park where they have plots and utilities in place for companies like GlycosBio. The entities also serve as a resource that supports hiring needs and the formation of off-take and feedstock supply agreements. “It would be like finding a needle in a haystack to really try to understand the local market and [identify] the right essential partners on the operational execution side,” Cilento says. “This [partnership] is a tremendous benefit. It would be very difficult to do this without such a partner.” The partnership also helps to instill local confidence in the project. “The biochemical market is still in the early stages, so you’re trying to demonstrate a technology that is really cutting edge,” Cilento continues. “A partner like that gives the market confidence. They provide a lot of credibility.”

Alternatively, Myriant Technologies Inc. is pursuing an overseas project via an agreement to develop a joint venture that was signed with the PTT Chemical Group of Thailand. “To try to develop a project from half a world away is enormously costly and time consuming,” says Sam McConnell, Myriant’s senior vice president for corporate development. “It’s hard enough to do here in the U.S., but to serve markets in Asia we sat down and decided we really need a local partner who understands how to get things done and has the necessary resources.”

Even before the agreement with PTT Chemical was signed, McConnell says Myriant was already looking to develop a project in Southeast Asia, largely because of the incentives that are available. “A number of countries, including Thailand, have been pretty aggressive in looking to attract high-tech manufacturing, so the fact that PTT Chemical is in one of those countries was certainly another big plus,” he says.

NatureWorks’ strategy in the Southeast Asian marketplace could vary from establishing a local partnership with locally based companies, to simply establishing a local presence itself, says Davies. “We’ve already done that on the sales and marketing end,” he continues. “We have local sales and marketing teams based in China, Hong Kong, Japan and Korea.” Those locally sourced teams are great at addressing challenges associated with language, customs and logistics, Davies says.

When selecting local partners for a project, Huc notes that you want to target partners who have a track record of building and operating similar facilities, such as ethanol or chemical plants. “When I say good track record, I mean they haven’t run into problems from an environmental or permitting standpoint, or security. They haven’t had a lot of accidents onsite—the companies that build projects on-time and on-budget and have privileged relationships with local trades and subcontractors.”

IP Protection

One area of particular concern for many companies is the protection of intellectual property (IP). Anytime you build and operate a plant, you are going to develop a lot of know-how that you are not necessarily going to patent, notes Huc.

When you bring technology into a new area, intellectual property of all kinds can be very difficult to manage. “You can have IP leakage during the planning and engineering stage, you can have IP leakage during the operation phase,” Huc notes. “In our experience, the best way to manage that type of IP leakage is to have strong, local partners who have a degree of influence on the authorities that are responsible for IP protection, and have some dissuasive influence on individuals.”

“I think [IP theft] is something that has happened quite extensively in China, but you are also vulnerable to it in other Asian countries,” Huc says. “The real risk is that you have somebody who appropriates your process know-how and replicates what you are doing right down the street. Most countries will claim to have preventative laws now. The problem is when something like that happens, despite having laws in place, you often find yourself having very little recourse, particularly in countries that have large domestic markets for your product. You have recourse if they infringe on your intellectual property and then export it into a market like the U.S., where you do have strong laws and precedence, but if you are in a country like China or South Korea, where there is a large local market, it’s very difficult for you to stop them from selling it domestically, especially if they are not dealing with foreign currency.”

However, Cilento notes that, in some regions, IP protection isn’t really a challenge. Rather, it is something that companies need to be aware of and manage from the beginning. “Many of the countries in Southeast Asia were born from U.K. law as colonies of the U.K. years and years ago,” he says. These countries understand that people question the security of IP in their region. “They go out of their way to differentiate themselves from different parts of the world where IP control and theft are more prevalent. Certainly in Malaysia and Singapore, they really try to put their best foot forward to give us some comfort.”

Managing Logistics

Another primary challenge when developing a project overseas is the need to be able to manage that project from half a world away. In other words, a company’s physical presence can be difficult to manage. “For new technologies, the commissioning and ramp-up of the plant are very, very important,” Huc says. “That expertise tends to reside within the company that is deploying the technology. The further you are from your headquarters and where your engineers are, the more difficult it is to oversee that. To manage that complexity, you have to send people abroad for long periods of time.”

The time difference is certainly a challenge as well, notes Cilento. “You are looking at a 10- to 13-hour time difference,” he says. “Travel to and from is easily a two or three day process, that’s without recovery time after you get back. You have to really invest a lot of time and energy in travel. You need to be able to take advantage of technologies like video conferencing and other techniques to minimize these challenges. Hiring both labor-level and senior management level employees is something that is not insurmountable, but without any critical mass or resources in country, you are really starting from scratch.”

That said, Cilento notes that GlycosBio is not anticipating any problems finding qualified employees. Malaysia features a large petrochemical industry and has also been very active in medical biotechnology. Assimilating those skills and professionals to industrial biotechnology shouldn’t be that difficult, he says. However, Cilento also notes that it is important to take time during local visits to meet with the local people and begin the recruiting process very early on in a project’s development.

As biorefining companies continue to expand and establish new production facilities around the world, certain challenges will be diminished, while others will remain. With each plant a company builds, the deployment of the technology itself will become more streamlined, says Huc. This is because after a company builds and operates a few plants, it will have gained knowledge to enable the design of more robust engineering packages. However, the establishment of each new location around the globe will still be complex in terms of finding the right partners and scaling up in a new cultural environment.

Author: Erin Voegele
Associate Editor, Biorefining Magazine

HOUSTON, TX – February 22, 2011 – Glycos Biotechnologies, Inc. (GlycosBio), an international biochemical company commercializing advanced biological processes that convert low-value feedstocks into high-value sustainable chemicals, today announced it has been granted the BioNexus Status from the Malaysian Government via Biotechnology Corporation (BiotechCorp), the national agency set up by the Malaysian government for the development of biotechnology in Malaysia.  This announcement marks another key milestone in GlycosBio’s expansion into Malaysia with the construction of the Company’s industrial biochemical plant and biotechnology research and development facility in Bio-XCell, a dedicated biotechnology park in Johor, Malaysia.

BioNexus Status is a recognition awarded by the Malaysian Government, through BiotechCorp, to qualified companies that participate in and undertake value-added biotechnology activities.  To date, 187 companies have been granted the BioNexus status and ten of these companies have United States shareholding.

“We are honored that BiotechCorp has granted GlycosBio with the esteemed designation of BioNexus Status and proud to join this elite group of companies,” said Richard Cilento, Chief Executive Officer of Glycos Biotechnologies.  “GlycosBio will gain a number of financial incentives and business development support services with this status further excelling our growth and expansion efforts in the Malaysian region.  The BioNexus status demonstrates the benefits of a collaborative effort between private enterprises and the strategic objectives of the Malaysian government. Having the support of BiotechCorp and working closely with their dedicated professionals has proven to be a key differentiator for GlycosBio and the emerging biochemical value chain we are supporting.”

GlycosBio was one of the first biochemical companies to partner with BiotechCorp in 2010 to construct a biochemical plant and biotechnology research and development facility in the Bio-XCell biotechnology ecosystem. Bio-XCell is Malaysia’s dedicated biotechnology park for industrial and healthcare biotechnology.  GlycosBio’s expansion plans are on schedule with the facilities construction and are expected to complete in 2012.  GlycosBio plans to focus much of its initial research and development efforts on creating isoprene to support Malaysia’s rubber industry.

“GlycosBio’s presence in Bio-XCell will not only provide Malaysia with human capital development and expanded investment opportunities but also support several of Malaysia’s economic objectives from providing palm oil and oleochemical producers more sustainable production methods to supporting the isoprene related industry which may include polymers such as rubber,” said Iskandar Mizal Mahmood, Chief Executive Officer, Malaysian Biotechnology Corporation.  “As one of the first companies to participate in the Bio-XCell ecosystem, GlycosBio will be a critical contributor to Malaysia’s near and long-term industrial and biotechnology goals.”

BioNexus Status companies enjoy a set of incentives contained within the BioNexus Bill of Guarantees.  BioNexus Status companies also receive continuous support and assistance from BiotechCorp on immigration related matters, IP advisory and regulatory services and employment related matters.  BiotechCorp also provides a wide range of capacity building programs covering a variety of subject matter to assist biotechnology entrepreneurs in managing their business locally and internationally.

About Glycos Biotechnologies, Inc.

Glycos Biotechnologies, Inc. (“GlycosBio”) is an international biochemical company commercializing advanced metabolic engineering and microbial strain processes that convert multiple low value feedstocks into a range of high value sustainable chemicals. By designing a portfolio of differentiated microorganisms, GlycosBio’s bioconversion technology produces a diverse set of chemicals, including substitutes for fossil fuel derived petrochemicals, meeting the growing global demand for clean, environmentally safe biochemicals.

GlycosBio is privately held and focused on biochemical commercialization and production with established global partnerships including relationships with petrochemical companies to secure low cost, non-petroleum based chemicals.  For more information, visit www.glycosbio.com.

About BiotechCorp

BiotechCorp is the lead development agency for the biotech industry in Malaysia and acts as a central contact point providing support, facilitation, and advisory services for life sciences companies in Malaysia. Since its establishment in 2005, BiotechCorp has played a key role in building the biotech business in Malaysia. To date, BiotechCorp has facilitated the development of 187 BioNexus-status companies in Malaysia, with total approved investment of close to RM 2 billion. BioNexus-status companies are international and Malaysian biotech companies that qualify for fiscal incentives, grants, and guarantees administered by BiotechCorp. For more information, visit www.biotechcorp.com/my.

About Bio-XCell

Bio-XCell is a biotechnology park and ecosystem for industrial and healthcare biotechnology, with a focus on manufacturing and R&D. Developed by Malaysian Bio-XCell Sdn Bhd, a joint venture company between BiotechCorp and UEM Land, the park is slanted to be the new regional biotech hub of Asia. Capitalising on value propositions of both its shareholders, Bio-XCell provides comprehensive infrastructure, services, incentives and benefits to drive the growth for the biotechnology sector.

Strategically located in Nusajaya, Iskandar Malaysia, the resource-rich state of Johor, Bio-XCell provides global connectivity through the network of five seaports and two international airports, all within 59kms. For information or leasing inquiries, log on to www.bio-xcell.com.

MEDIA CONTACT

Suzanne Tormollen
Atingo Public Relations
281-785-1280
suzanne@atingo.com

HOUSTON, TX – February 10, 2011 – Glycos Biotechnologies, Inc. (GlycosBio), an international biochemical company commercializing advanced metabolic engineering and microbial strain processes to convert low-value feedstocks into high-value sustainable chemicals, today announced the appointment of Gary Mossman, chemical industry veteran, to the Company’s Board of Directors.  Mossman’s experience spans both large and small molecular technology with more than 40 years of executive management and investment responsibility in private and public pharmaceutical and specialty chemical firms.

“GlycosBio is very pleased to welcome Gary to our Board of Directors,” said Richard Cilento, Chief Executive Officer of Glycos Biotechnologies.  “Gary’s range of expertise in chemicals, pharmaceuticals and manufacturing coupled with his business, technical and leadership background will play an integral role in GlycosBio’s efforts to continue developing innovative products and further advance the Company’s position as a leader in producing sustainable biochemicals.”

Mossman is currently Chief Operating Officer (COO) and Director of PLx Pharma, an emerging Pharma company and Chairman of Redline Industries, a metal fabricator.  In addition, he is a director of the Nassau Bay Economical Development Council and the CCISD Educational Foundation.   Previously, Mossman held the position of Executive Vice President and COO of Cambrex Corporation where he was responsible for global operations of this leading provider of API’s including Generics, Biotech and Pharma Development Services, Drug Delivery, and Diagnostic Products.  Mossman also served as Chief Executive Officer and Vice Chairman of Dixie Chemical Company, a top tier specialty chemical company.

“The majority of my professional career has been focused in specialty chemicals, biotechnology and biopharmaceuticals,” said Mossman. “GlycosBio is a smart company making incredible discoveries to help further the industry’s advancement toward biochemical independence and I’m excited to have the opportunity to extend my experience and knowledge to GlycosBio to help them continue to reach their business goals.”

Mossman joins current GlycosBio Board of Directors members including Walter Burnap, President and Chief Financial Officer of GlycosBio; Richard Cilento, Chief Executive Officer of GlycosBio; Steve Jurvetson, Managing Director, Draper Fisher Jurvetson; and Dan Watkins, Managing Director of DFJ Mercury.

About Glycos Biotechnologies, Inc.

Glycos Biotechnologies, Inc. (“GlycosBio”) is an international biochemical company commercializing advanced metabolic engineering and microbial strain processes that convert multiple low value feedstocks into a range of high value sustainable chemicals. By designing a portfolio of differentiated microorganisms, GlycosBio’s bioconversion technology produces a diverse set of chemicals, including substitutes for fossil fuel derived petrochemicals, meeting the growing global demand for clean, environmentally safe biochemicals.

GlycosBio is privately held and focused on biochemical commercialization and production with established global partnerships including relationships with petrochemical companies to secure low cost, non-petroleum based chemicals.  For more information, visit www.glycosbio.com.

MEDIA CONTACT

Suzanne Tormollen
Atingo Public Relations
281-785-1280
suzanne@atingo.com

Paul Campbell, Chief Science Officer for GlycosBio, will participate in a panel with other leading biochemical companies to explore the growing shift in the industry from biofuel to biochemical production.  Panelists will examine why companies may be choosing biochemicals over biofuels, the long-term sustainability and future of such a choice, and the potential synergies between these two strategies.

With more than 90 speakers confirmed, the 2^nd Annual Next Generation Bio-Based Chemicals Summit is quickly becoming a growing tradition for key industry players, leading developers, government representatives, ground breaking researchers, and renowned financiers to gather, discuss and foster cutting edge innovations for bio-based chemicals.

What: “Expanding from Fuels to Chemicals”

Who: Moderator

John Eustermann, Partner, Stoel Rivers, LLP

Panelists

Alan Berry, Director, Microbial Physiology and HTS, Novozymes, Inc.

Doug Cameron, Managing Director, Alberti Advisors, LLC

Paul Campbell, PhD., Chief Science Officer, Glycos Biotechnologies

Vonnie Estes, Vice President, Corporate Development, Codexis, Inc.

Joseph Kocal, Director of Renewable Research, UOP, a Division of Honeywell, Inc.

Where: Hilton San Diego Resort & Spa

When: Wednesday, February 16^th, 10:30am – 11:30am

For more information about the Next Generation Bio-Based Chemicals Summit, visit http://www.infocastinc.com/index.php/conference/436.

About Glycos Biotechnologies, Inc.

Glycos Biotechnologies, Inc. (“GlycosBio”) is an international biochemical company commercializing advanced metabolic engineering and microbial strain processes that convert multiple low value feedstocks into a range of high value sustainable chemicals. By designing a portfolio of differentiated microorganisms, GlycosBio’s bioconversion technology produces a diverse set of chemicals, including substitutes for fossil fuel derived petrochemicals, meeting the growing global demand for clean, environmentally safe biochemicals.

GlycosBio is privately held and focused on biochemical commercialization and production with established global partnerships including relationships with petrochemical companies to secure low cost, non-petroleum based chemicals.  For more information, visit www.glycosbio.com.

MEDIA CONTACT

Suzanne Tormollen
Atingo Public Relations
281-785-1280
suzanne@atingo.com

Carol Potera

This year’s honoree for Company of the Year, went to Solazyme. “Solazyme made the decision several years ago to grow heterotrophic algae in the dark and harvest renewable oils – and have become the unquestioned leader in the quest to make an integrated biorefinery commercially successful in the production of renewable oils for fuels, foods and other bio-based products,” noted Digest editor Jim Lane. “Along the ways they’ve racked up an impressive array of partners, and won contracts to supply biofuels to the US Department of Defense. More importantly, in every way, they have personified throughout their organization what it means to be an advanced bio-based company – in the ways that they have triumphed, and in the ways they have faced adversity.”

The award for Product of the Year (fuels) went to Amyris for its farnesane molecule, which it is now producing in Brazil. Made by adding hydrogen to farnesene (itself produced via Amyris’s novel modified yeast fermentation technology), it can be utilized as a drop-in replacement for fossil-based diesel fuels.

Product of the Year (renewable chemicals) went to OPX Biotechnology for its work in reducing the production cost of bioacrylic by more than 85 percent in its pilot production process, using sugars and syngas as feedstocks.

Product of the Year (bio-based products) went to Genencor for its development of bioisoprene and, in partnership with Goodyear, the development of renewable technology for the production of tires, using a novel fermentation process based on  an engineered molecule.

Project of the Year went to Neste Oil for the completion and start-up of its massive 240 million gallon renewable diesel plant in Singapore.

Technology of the Year Awards went to LanzaTech, the partnership of Rentech and ClearFuels Technology, the partnership of Taurus Energy and SEKAB, and Renewable Energy Group. These awards recognized pre-pilot, pilot, demonstration-scale and commercial-scale installations.

LanzaTech is commercializing the fermentation of waste steel gases into ethanol and other bio-based chemicals, with a pilot in New Zealand and a forthcoming demonstration of its technology in China. Rentech and ClearFuels have combined on a gasification and Fisher-Tropsch processing of biomass into synthetic jet or diesel fuels, in a project that will be built at Rentech’s Product demonstration Unit in Colorado, and has been supported by a $23 million grant from the US Department of Energy.  Taurus Energy and SEKAB have combined on a cellulosic ethanol process, using Taurus Energy’s yeast strains and SEKAB’s demonstration-scale cellulosic ethanol plant in Sweden. Renewable Energy Group was honored for its novel continuous-flow, multi-feedstock processing technology that has allowed the company to pioneer the acquisition of a wide variety of hard-to-process, low-cost feedstocks such as tallows and yellow grease.

The town of Emmetsburg, Iowa was recognized as Community of the Year for the transformation of the small local community’s economy through corn and cellulosic ethanol. The town is the site of POET’s Project LIBERTY, a 20 million gallon cellulosic ethanol demonstration, bolted onto an existing corn ethanol plant, which also is home to advanced work by POET BIOMASS in corb cob and agricultural residue harvest and logistics.

For Project Structure, Biofuels Digest recognized ZeaChem, for creativity in financial structure, as well as BlueFire Renewables, for off-take and feedstock contracting. Sapphire Energy received the “Plan for Scale” award for its design of its  algal biofuels system with planned demonstration scale facility in 2014 and first commercial facility in 2018.

The Digest recognizes Iowa State University as Institutional Research Facility of the Year, the Joint BioEnergy Institute as Government-Institutional Research Facility of the Year, and the Energy Biosciences Institute as Public-private Research facility of the Year. JBEI’s researchers have been notably active in the development of novel technologies utilized by, among others, Amyris and LS9, while EBI has lately funded research that resulted in a newly engineered yeast strain, that can simultaneously consume glucose, a six-carbon sugar that is relatively easy to ferment; and xylose, a five-carbon sugar that has been much more difficult to utilize in ethanol production. Iowa State’s BioCentury Research Farm provides researchers with the opportunity to integrate harvesting, transportation, storage, and processing, as well as test plant breeding, genomics, cropping systems, soil conservation and nutrient management.

Partnerships were recognized in several awards this year. The Corporate partnership of Boeing, Air China and PetroChina is recognized for pioneering the testing and availability of jatropha-based aviation biofuels for the key China aviation market. Algenol and Lee County (Florida) were recognized for Public private partnership (county) of the Year, a partnership which has resulted in a state-of-the-art algal biofuels research center in southwest Florida as well as a future pilot-scale algal farm. Enerkem and the US state of Mississippi were recognized for Public private partnership (state or province) of the Year for their work in developing the Pontotoc, MS cellulosic ethanol project using municipal solid waste. Ineos BIO and the US Department of Energy are recognized as Public private partnership (National) of the Year for their cooperation in bringing the Vero Beach, Florida cellulosic ethanol demonstration plant to fruition on schedule. The US Department of Agriculture and the US Navy are recognized for Public-public partnership of the Year for their cooperative work in developing advanced biofuels for naval onshore and fleet operations. Finally, Cosan and Shell are recognized as Joint Venture of the Year for their $14 billion combination of ethanol, advanced biofuels, sugarcane and fuel distribution assets in Brazil.

In Feedstock development, Ceres is recognized as Feedstock research project of the year (new feedstock or traits) for its development of seawater-tolerant energy grasses. SG Biofuels is recognized as Feedstock domestication project of the Year (new feedstock or traits) for its development of the JMax platform for jatropha in Cehtral America. Genera Energy is recognized as Feedstock grower development project of the year for its work in developing a switchgrass-grower network in Tennessee.

The Bio-XCell project in Iskandar, Malaysia is recognized as Multi-project (co-location, or symbiosis) development of the Year, for its custom-built biotechnology park and ecosystem being developed by Malaysian Biotechnology Corporation and UEM Land Holdings, which will become home to the GlycosBio demonstration-scale project among other tenants in 2012.

Statoil was recognized as Downstream partner of the Year for its work with Inbicon, Bioarchitecture Lab and other partners in creating investment and distribution for advanced biofuels.

Bunge was recognized as Strategic Investor of the Year for its investments in Solazyme, Renewable Energy Group, and its strategic alliances with Verenium, and SG Biofuels.

Company of the Year SOLAZYME

Technology of the Year (pre pilot) RENTECH, CLEARFUELS

Technology of the Year (pilot) LANZATECH

Technology of the Year (demonstration state) TAURUS ENERGY, SEKAB

Technology of the Year (commercial stage) RENEWABLE ENERGY GROUP

Product of the Year (fuel) AMYRIS – FARNESENE

Product of the Year (renewable chemicals) GENENCOR – BIOISOPRENE

Product of the Year (bio-based products) OPX BIOTECHNOLOGY – BIOACRYLIC

Project of the Year NESTE OIL, SINGAPORE

Project Structure of the Year (off-take and feedstock contracting) BLUEFIRE RENEWABLES

Project Structure of the Year (creativity in financing) ZEACHEM

Community of the Year EMMETSBURG, IOWA

Institutional Research Facility of the Year IOWA STATE UNIVERSITY

Government Research Facility of the Year JOINT BIOENERGY INSTITUTE

Public-private Research Facility of the Year ENERGY BIOSCIENCES INSTITUTE

Corporate partnership of the Year BOEING, AIR CHINA, PETROCHINA

Public private partnership (county) of the Year ALGENOL – Lee County, FL

Public private partnership (state) of the Year ENERKEM

Public private partnership (federal) of the Year Ineos BIO, US Department of Energy

Public-public partnership of the Year US Department of Agriculture, US NAVY

Joint venture of the Year COSAN, SHELL

Plan for Scale SAPPHIRE ENERGY

Feedstock research project of the year (new feedstock or traits) CERES

Feedstock domestication project of the Year (new feedstock or traits) SG BIOFUELS

Feedstock grower development project of the year GENERA ENERGY

Multi-project (co-location, or symbiosis) development of the Year BIO-XCELL – ISKANDAR, MALAYSIA

Downstream partnership of the Year STATOIL

Top Strategic Investor BUNGE

The vegetable oil industry has witnessed significant growth over the past few years on account of a growing population as well as the rising demand for alternative energy sources. Among the various types of vegetable oil, palm oil (including palm kernel) accounted for the largest share of the global production in 2009, followed by soybean and rapeseed oil.

Of the available vegetable oils, palm oil is the most productive and has the lowest cost of production, thus accounting for the major share of the global vegetable oil output. In recent years, the rising health concerns have also accelerated the demand for palm oil, particularly in developed markets.

Palm oil use is broadly separated into food and non-food categories. The product is mainly used as cooking oil but is also increasingly being used in the preparation of other food articles. As a non-food ingredient, the product finds application in the production of cosmetics, toiletries, soaps and detergents.

Although, FMCG is the largest market, the utilisation of palm oil for the production of bio-diesel has been growing steadily. Apart from this, the switch of consumers from loose oil to packed oil, particularly in emerging markets, is also expected to boost the palm oil industry’s growth in the future.

Geographically, Indonesia and Malaysia are the largest producers of palm oil, while China and the EU are the largest consumers. In Europe, Germany is the largest consumer of palm oil, followed by France and Italy. The emerging markets, like China, India and Indonesia consume more than 80% of palm oil. Due to rising population and increasing income, the emerging markets including China and India are anticipated to record an increase in demand for palm oil.

After bouncing back from the recession, Malaysian and Indonesian palm oil demand is set to rise strongly, with new uses driving growth
Oleo-chemical industry
The oleo-chemical industry in Southeast Asia is expected to enjoy robust growth in 2010-2012, fuelled by a short-term hike in demand from consumer markets and wider availability of raw materials such as palm oil, palm kernel oil and coconut oil.

Long-term growth is expected to be stimulated by growing markets for green chemicals and uses in new applications.

On the other hand, the Asian oleo-chemical industry faces the challenges posed by the slowdown in global demand in export markets following the October 2008 economic crisis and increasing competition from cash-rich plantations and petrochemical companies that are keen to get a slice of the oleo-chemical production pie.

In Southeast Asia, oleo-chemical production is mainly centred on the manufacture of fatty acids, fatty alcohols, methyl esters and refined glycerine.

These then go into the end-use applications of surfactants, soap and detergents, cosmetics and food emulsifiers. New applications driving growth are in the areas of bio-lubricants, green chemicals, bio-plastics and biopolymers.

Although export markets and the global oleo-chemical industry experienced a slowdown in 2009 in the aftermath of the crisis of October 2008, the first half of 2010 saw an improvement in demand for Asian-based oleo-chemicals.

Industry outlook
Fatty acid demand is expected to continue to be strong in 2010, fuelled by growth in consumer products such as cosmetics and plastics. Prices of fatty acids in Asia are dependent on feedstock palm kernel, palm stearin and crude palm oil prices and tend to follow the price trends of these raw materials.

The first half of 2010 saw prices of most fatty acid groups rising month-on-month, in tandem with higher feedstock values. In the second half of the year, prices of most fatty acids are also expected to remain firm as a result of higher projected feedstock values.

The total capacity output of fatty acids in Southeast Asia is estimated to be 3.5m tonnes in 2010, with oleo-chemical production in Malaysia alone accounting for around 57% of that worldwide.

Similarly, fatty alcohol production is expected to grow at a rate of 5% in 2010 as demand for consumer products such as detergents and industrial surfactants is expected to increase year on year.

Prices have steadily increased for both mid-cut and long-chain alcohols since January and reached a historical high for mid-cut alcohols in August at levels above $2,000/tonne (€1,531/tonne) FOB (free on board) Southeast Asia.

Prices in the second half of the year are expected to continue to rise on the back of tight supply amid a few regional plant shutdowns, as well as higher feedstock values.

New uses for refined glycerine
In the refined glycerine space, growth is expected to be slower in 2010 but is predicted to pick up in 2011-2012, fuelled by newer applications such as those of epichlorohydrin (ECH), propylene glycol (PG) and other new applications currently under research, including aromatic solvents and polymers.

2010 has also seen weaker demand for refined glycerine as a result of oversupply in the market.

The projected growth of the refined glycerine industry is around 5.8% in 2010. The estimated demand for refined glycerine in 2010 is expected to be around 280,000 tonnes, while it is estimated that supply from oleo-chemical production including China, will be double demand, at 543,000 tonnes.

Prices in the second half of the year are expected to remain soft-to-stable as the weak demand situation is likely to persist until the end of the year.

Integration appreciation
The government initiatives include development of palm oil industrial clusters into integrated sites for promoting downstream activities such as bio-fuels, oleo-chemicals, bio-fertilisers, specialty food and biomass products, nutraceuticals and pharmaceuticals. These initiatives are expected to boost the country’s reputation as a global leader in the value-added space of palm oil products.

With 16 oleo-chemical plants with a combined capacity of 1.9m tonnes/year, there is much potential for growth in the global oleo-chemical space in Malaysia.

Future capacity expansion
The growth in the oleo-chemical industry is expected to remain strong, especially in Malaysia. New capacity is expected to be added. This includes an expansion plan by Malaysia’s Emery Oleochemical to boost its fatty acid capacity from 600,000 tonnes to 900,000 tonnes by 2012.

Biotech companies Glycos Biotechnologies of the US and Malaysia’s Bio-XCell have also entered a joint venture to build a biochemical and biotechnology centre in Malaysia that would utilise glycerine to produce bio-chemicals. The centre will be completed in 2012.

In Indonesia, Singapore agriculture group Wilmar International has also entered a joint venture with US vegetable oil derivatives specialist Elevance Renewable Sciences to set up a 180,000 tonne/year bio-refinery at Surabaya, Indonesia, due to be operational in 2011. The bio-refinery will produce a high-quality mix of oleo-chemicals, among other products.

These initiatives are expected to boost the Malaysia’s reputation as a global leader
Sri Lankan scenario
Sri Lanka’s interest in this sub-sector centres on the cultivation of about 75,000 ha by five Regional Plantation Companies (RPCs), around 70,000 ha of which are in Indonesia and Malaysia, and about 5,000 ha in Sri Lanka.

The revival of NR market boom, although known to be very volatile, may dampen the enthusiasm generated among some plantation companies. Yet, as the oil palm forecasts look very stimulating and attractive in the long term, crop diversification strategies planned and adopted by some RPCs are expected to grow.

The Ministry of Plantation Industries also proposes to expand the land extent under oil palm from the current 5,000 hectares to 25,000 hectares as a tree crop diversification policy for sustainable development of this sector. A public-private sector partnership becomes crucial in this programme.

Research and innovation
The palm oil industry needs to increase yield through research and innovation. It is a fact that oil palm has the highest yield per hectare and also has the highest productivity cycle of 25 years. But one can grow the oil palms only in the equator, which means any more land clearing would have a catastrophic impact on the world’s climate. Therefore, it has become important to increase productivity and quality through research and innovation.

There is a need to implement process improvements such as mechanisation, automation, yield forecasting, fertiliser programmes, focal feeding, etc.

In 2010, palm oil is expected to account for 34 per cent or 44 million metric tonnes (MT) of the global vegetable oil supply and yet, it occupies less than five per cent of total agricultural space. With the global population projected at 7.2 billion by 2015, this trend is expected to reverse itself, as we expect to see palm oil commanding a 40 per cent market share at 64.5 million MT, closely followed by Soybean oil  at 33 per cent or 53.4 million MT.

It has been forecasted that by 2020, palm oil should have a 46 per cent market share at 94.3 million MT. Soybean oil will still be in the second position by then, at 29 per cent of the market share or 60.7 million MT.

Recent activities in the cellulosic ethanol industry have shown that while financing continues to be a major hurdle, technological advancements continue to be made and companies are beginning to construct their first commercial-scale facilities.

BlueFire Renewables Inc.
BlueFire has secured 15-year offtake and feedstock supply contracts for its proposed Fulton, Miss., plant and named Fargo., N.D.-based Wanzek Construction Inc. as its engineering, procurement and construction (EPC) contractor. Company CEO Arnold Klann said the agreements will help BlueFire secure its pending $215 loan guarantee from the U.S. DOE. “There’s no reason for this project not to get financed, save for the governmental loans not getting through due to bureaucratic hold-ups,” he said. “We have met and greatly exceeded every criteria that we know of that has been set by the DOE loan guarantee program.”

BlueFire’s proposed 19 MMgy facility will convert various wood waste feedstocks into ethanol using the company’s acid hydrolysis technology. Mobile, Ala.-based Cooper Marine & Timberlands will supply the facility with 770 dry tons per day of feedstock beginning in December 2012 at a cost of $25 per ton, according to Klann. When ethanol production begins, Tenaska Biofuels LLC has agreed to purchase and market all of the fuel produced at the plant. BlueFire’s sale price will be based on a pricing contract that includes rack ethanol prices for the area to which the fuel will be delivered, minus transportation costs, with a kicker for renewable identification number (RIN) credits, he said.

Fiberight LLC
Fiberight and U.K.-based TMO Renewables Ltd. have agreed to design and build 15 commercial-scale cellulosic ethanol production facilities across the U.S. within the next five years. With capacities from 10 to 15 MMgy, they will utilize a combination of TMO’s process technology and Fiberight’s fractionation and digestion technology to convert municipal solid waste (MSW) to ethanol at a more efficient, cost-effective pace. “Together, the companies are on track to become one of the largest producers of cellulosic ethanol in the U.S. during 2011, helping to divert millions of tons of waste away from landfills every year,” said Fiberight CEO Craig Stuart-Paul. Fiberight’s 5 MMgy facility in Blairstown, Iowa, will serve as the initial site and others in the Mid-Atlantic and Florida areas have been identified for the next five plants.

Glycos Biotechnologies Inc.
Houston-based GlycosBio has engineered the first microbial platform for the synthesis of biofuels and biochemicals—ethanol, butanol, acetate, acetone, isopropanol, succinate and propionate—from fatty acids. “Until now, microbial platforms to enable the biological production of fuels and chemicals from fatty acids have been nearly non-existent,” said Paul Campbell, chief science officer for GlycosBio. “Through our research, we were able to prove the effectiveness of fatty acids to produce higher value chemicals at very high yields with an empirical ethanol yield double that which is usually achieved with sugars. These results demonstrate that fatty acids can be a great alternative to cellulosic sugars.”

Fulcrum BioEnergy Inc.
CEO Jim Macias said MSW currently being tipped at landfills in the Reno-Lake Tahoe, Nev., basin will provide approximately 90,000 tons of annual feedstock for Fulcrum’s planned 10.5 MMgy Sierra Biofuels Plant near Reno.

The company began EPC activities earlier this year and expects to begin producing ethanol using a thermochemical process in mid-2012. A subsidiary of Fluor Corp. was awarded the contract to provide EPC services for the $120 million project.

“It took us longer to raise the capital in this very tough market, but we’re very pleased to get this project going and demonstrate the commercial viability, not just for our project but for the industry,” Macias said. Fulcrum is planning projects in Houston, Colorado, Florida, Oklahoma, Tennessee and New England.

Enerkem Inc.
Enerkem broke ground Aug. 31 on its 10 MMgy MSW-to-ethanol facility in Edmonton, Alberta, which will convert 100,000 metric tons of trash annually when it becomes operational. “As a result of this facility, we will become the first major city in North America to see 90 percent of residential waste diverted from landfill by 2013,” said Edmonton Mayor Stephen Mandel.

“This groundbreaking marks the launch of a transformative project and leads the first wave of commercial-scale advanced biofuels plants in North America,” Vincent Chornet, Enerkem president and CEO, said. Enerkem also is developing a 20 MMgy MSW-to-ethanol project in Pontotoc, Miss.

American Process Inc.
Georgia-based API began work in August on its 900,000 gallon per year cellulosic ethanol facility in Alpena, Mich. The plant will be co-located with a decorative panels industrial hardwood plant and will convert industrial wood hydrolyzate waste to ethanol and aqueous potassium acetate beginning next year. Valero Energy Corp. is invested in the project, which has so far also received approximately $23 million in state and federal grants.

Mascoma Corp.
Mascoma has acquired Canada’s SunOpta BioProcess Inc. for $51 million. It will use SunOpta’s first-step pretreatment process with its own technology to produce cellulosic ethanol more efficiently and cost-effectively. Mascoma CEO Bill Brady said the company chose SunOpta’s technology because it is a steam explosion technology that uses no harsh chemicals or acids. Construction is to begin at the company’s 20 to 40 MMgy plant in Kinross, Mich., by mid-2011 and be completed in 2013.

KL Energy Corp.
Wyoming-based KL Energy is working with Brazil’s Petrobras to develop and commercialize bagasse-to-ethanol technology. Petrobras is investing $11 million in the project, which will be used to modify KL Energy’s demonstration facility and fund process optimization and technology licensing. The companies will install the technology at one of Petrobras Group’s Brazilian sugarcane mills. The 4 MMgy project is expected to be completed in 2013.

The company plans to focus much of its initial research and development efforts on creating isoprene to support Malaysia’s rubber industry.  “For Malaysia, isoprene is a strategic product because of the large domestic latex industry and where we plan to focus much of our R&D efforts,” said Richard Cilento, Chief Executive Officer of Glycos Biotechnologies.  “With construction underway, our long-term strategy includes further expansion in Malaysian and across Southeast Asia forming joint venture partnerships with existing petrochemical, oleochemical, and biofuel producers and to partner with end market players in the development of advanced biochemicals.