Biochemical markets a hot topic at biorefining event

By Erin Voegele | September 15, 2011

There are many factors that go into building a successful biorefining operation. According to Martha Hilton, a commercial development leader at Segetis Inc., the formation of effective partnerships is one of the most important. “If you don’t have partnerships, you are going to die,” she said.

Segetis is a green chemistry company that produces chemical building blocks. “In our pipeline we do have proof-of-concept actual molecules—and probably for the most part technology—either in the submitted, or being submitted, phase with surfactants, lubricants, polyols, and thermo plastics.” However, the company’s first focus has been on levulinic ketal esters that can readily be extended with alcohols, esters and amines.

“One of the things we have done is we have partnered on both ends of this,” Hilton said, from how to use wood pulp feedstock to produce levulinic acid that meets the specific needs of end users, to those who need a biobased lubricant that meets certain performance or end-use requirements. “We partner with that,” Hilton said. “That’s how we stay alive, with joint development agreements.”

One area of focus for Segetis is plasticizers. ”We have leaned heavily on the director of marketing to keep our molecule vendors and our bright R&D folks focused on what can make money,” Hilton continued. “We all know a technologically brilliant widget that you can’t sell isn’t going to keep a company sustained.” The combination of existing phthalate producers consolidating, as well as the fact that phthalates themselves have been under scrutiny, has opened up an opportunity. This is especially true, Hilton said, since there is been growth in the biopolymer industry.

Hilton spoke about her company and its operations at the International Biorefining Conference & Trade Show in Houston Sept. 15. Rob Toker, vice president of partnerships and market research at Glycos Biotechnologies Inc., and David Demirjian, president and CEO and co-founder of zuChem Inc., also spoke on a panel titled “Refining the Market for Biobased Chemicals” with Hilton.

“Geography really is destiny,” Toker said. His company has operations both in Houston and Malaysia. Houston is a great place to do business for us, he said. There is great access to human capital, and engineering talent that comes out of the downstream petrochemical community and the Texas medical center. He said Malaysia is also a great place to operate. “We think [the region] has great market access, great access to human capital, and we are very pleased with the business environment in Malaysia,” he said. “There is a respect for intellectual property and there is a strong regulatory environment and a strong legal environment that we benefit from. There is labor flexibility, which we appreciate, an obviously there is a natural resource base.”

While many companies in the renewable chemicals space are focused on the use of sugar or starch as feedstock, GlycosBio is not. Rather, the company’s Malaysia project is largely focused on the use of glycerin coming out of the regional palm industry. “The Bio-Xcell project is the project in southern Malaysia,” Toker said. “We have a phase one that is in construction right now…and there is phase two expansion that we are actively marketing to finance partners and strategic partners.”

GlycosBio aims to produce monomers for the synthetic rubber industry. “We are committed to isoprene,” Toker said. “We think isoprene is a terrific opportunity. Isoprene goes into all tires…On the supply side, natural latex rubber is very expensive…compared to historic trends, and we see that as persisting. That’s why we are in Asia. That is where the demand is. That is where the capital investments are.”

Demirjian’s company, alternatively, is focused on the development of glycochemicals that can be manufactured as coproducts to biofuel production, such as ethanol. The chemicals targeted by zuChem will serve the human health and nutrition markets.

zuChem is specifically targeting xylitol production. Xylitol is a specialty product that can be used to sweeten gum and confectionary products. “Xylitol is part of the $1.5 billion polyol market,” Demirjian said. “Sorbitol dominates this market because it is so cheap to produce.”

Xylitol is currently made through a chemical hydrogenation process, using pure xylose as feedstock. The problem is that pure xylose is rather limited in supply, and is very expensive. “What zuChem’s bioprocess does is…takes hemicelluloses…and does a fermentation to get xylitol,” Demirjian said. “So, we have a less expensive starting material and a pure product at the other end.”