Itochu Corp. invests in ZeaChem, 2014 commercial deployment set

By Bryan Sims | March 08, 2012

Tokyo-based international commodities trading firm Itochu Corp. has acquired an undisclosed amount of shares in Colorado-based biorefining technology developer ZeaChem Inc. Together, Itochu and ZeaChem intend to acquire partners in Japan, as well as in the U.S., to expand ZeaChem’s novel cellulosic ethanol and biobased chemical technology platform worldwide with aims of deploying it at commercial scale by 2014.

According to Jim Imbler, president and CEO of ZeaChem, Itochu offers a “cafeteria” of resources for emerging biorefining companies that can access and leverage its range of resources to help accelerate global commercial deployment of the technology.

“Itochu brings a global presence in feedstock sourcing for biorefining activities, including advanced bifuels and biobased chemicals, experience in identifying sites where there are plentiful supplies of wood for feedstock, a solid balance sheet and resourcefulness for networking with other potential collaborators that might work with us during deployment of our technology,” Imbler told Biorefining Magazine.

Itochu’s investment in ZeaChem follows the company successfully completing contract negotiations in February to receive its portion of a $40 million grant from USDA’s National Institute of Food and Agriculture through the Agriculture and Food Research Initiative Regional Coordinated Agricultural Project.

ZeaChem’s role in the USDA project entails participating in the logical progression of its phased development strategy, in which it will investigate and develop saleable products at each step toward commercialization. The company will receive $12 million of the total $40 million grant and will implement the AFRI project at its existing 250,000 gallon integrated cellulosic ethanol and biochemical demo biorefinery located at the Port of Morrow, near Boardman, Ore.

Biobased jet and diesel fuels are an extension of ZeaChem’s proprietary C2 product platform currently being developed at the Boardman biorefinery, which includes intermediate chemicals such as acetic acid and ethyl acetate, as well cellulosic ethanol. Design of the AFRI project is underway and the equipment modules are expected to be installed next year. Production of biobased jet and diesel are also expected to launch next year and production of biobased propylene glycol, propylene and other products, part of the company’s C3 product platform, will follow in 2015.

In January, ZeaChem began core facility operations at its demo facility in Boardman. The “bookends” project, as the company calls it, which “enables the production of cellulosic ethanol,” will be complete this year. Also that month, the USDA approved a conditional commitment worth $232.5 million to ZeaChem through the Biorefinery Assistance Program, which is expected to cover the total project cost the company’s planned 25 MMgy commercial-scale biorefinery, to be co-located at the site of the demo facility in Boardman, is estimated to be $390.5 million.