Air New Zealand signs MOU with biocrude developer

By Erin Voegele | December 20, 2011

Air New Zealand has signed a memorandum of understanding (MOU) with Sydney, Australia-based Licella Pty Ltd. to examine the development and commercialization of a process to convert woody biomass into biofuel.

According to information released by Air New Zealand, Licella has developed a process technology that features a catalytic hydrothermal reactor (Cat-HTR), which converts biomass into biocrude oil. Under the MOU, the two companies will jointly explore the potential of the technology to produce biobased jet fuel in New Zealand.

Information published on Licella’s website notes that its proprietary supercritical water technology can convert any type of biomass material into bio crude. Licella states that it’s supercritical water technology, which uses heat and pressure to make water approach a fourth state of matter, breaks down the ether linkages of pulverized biomass. According to the company, Radiiata Pine sawdust and energy crops have been successfully processed into biocrude at its pilot facility.

In a press release announcing the MOU, Air New Zealand Deputy CEO Norm Thompson noted that his company is collaborating with a number of parties to research and develop sustainable, biobased jet fuel. The initiative focuses particularly on developing a biobased aviation fuel industry in New Zealand.

"We are excited about signing the MOU with Licella to work more closely together to examine the potential commercialisation of their technology to produce sustainable biofuel in New Zealand," Thompson said.

Air New Zealand and New Zealand Trade and Enterprise have been working closely with Licella and Norske Skog for more than two years regarding opportunities for the technology in New Zealand. Licella Fibre Fuels, a new joint venture formed by Licella and Norske Skog Australasia, holds the exclusive license of proprietary knowledge and IP for converting sustainable lignocellulosic biomass into a biocrude oil using the Cat-HTR.

"Our ability to be able to make a bio-crude oil which can be ‘dropped in' and blended with traditional crude is a key differentiator of our technology, as it significantly reduces the capital costs of its implementation and enables us to increase volumes over time," said Licella CEO Steve Rogers. Rogers also noted that the Licella Fibre Fuels joint venture will hopefully lead to the construction of a large-scale production facility in either New Zealand or Australia.