Novamont, Genomatica seal joint venture for Italian bio-BDO plant

By Bryan Sims | January 24, 2012

California-based Genomatica and Italian company Novamont have signed a definitive agreement to establish a joint venture for the first industrial biorefinery in Europe to produce Genomatica’s biobased butanediol (BDO) for use in Novamont’s biopolymer products.

Under the agreement, Novamont is converting an existing facility in Adria, Italy, to use Genomatica’s BDO process. Novamont is financing the facility conversion and will operate the plant, which is expected to have an annual production rate of approximately 40 million pounds. Initial production is expected to begin in 2013.

“Genomatica’s BDO process provides Novamont with BDO made from renewable feedstocks, which is consistent with our business strategy to use more biobased raw materials in MATER-BI biopolymer products,” said Catia Bastioli, CEO of Novamont. “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.”

Novamont has committed to purchasing all of the output from the plant, while Genomatica may purchase a portion at its discretion to support further market development. The agreement also contemplates Novamont building and operating a second BDO plant using Genomatica’s process, which is expected to use biomass sugars as the primary feedstock.

“Genomatica’s process technologies enable a new approach to chemical production,” said Christophe Schilling, CEO of Genomatica. “Smaller-scale, capital-efficient manufacturing from renewable feedstocks that we believe fulfills customer needs across the value chain. Novamont is a leader in one of the most rapidly growing polymer segments of the BDO market and has demonstrated its ability to accelerate commercialization of innovative polymers, along with its commitment to sustainable development.”

The launch of the joint venture follows a letter of intent by the two companies back in August. Novamont will have a majority of the equity in the joint venture.

The partnership between the two firms is not the first for either company. Genomatica has partnerships forged with Tate & Lyle, Mitsubishi Chemical, Gruppo M&G and Waste Management Inc. Similarly, Novamont has partnered with Eni, an Italian oil and gas company, to build another biorefining facility located at an Eni petrochemical plant. Novamont has also opened a North American facility in Connecticut.