China biobutanol firm files F-1 for public offering in US; developing process for cellulosic biobutanol
|Cathay’s current bio-refinery model using corn starch as feedstock. Click to enlarge.|
Shanghai-based Cathay Industrial Biotech, a producer of bio-derived n-butanol and of bioprocess-based long-chain dicarboxylic acids (LCDAs) used as chemical intermediates, has filed a form F-1 with the US Securities and Exchange Commission in preparation for offering American depositary shares (ADS) in the US market.
Cathay presently produces its biobutanol via fermentation (ABE, acetone, biobutanol and ethanol) using corn starch as its feedstock; one of its key pipeline products is biobutanol produced using biomass (such as corncobs and corn stover) as a feedstock instead. The other is Disodium Inosine-5'-monophosphate and Disodium Guanosine-5'-monophosphate (I+G)—a food flavor enhancer that complements monosodium glutamate (MSG).
|Cathay’s model using biomass as feedstock. Click to enlarge.|
Cathay commissioned Chemical Market Associates, Inc. (CMAI), Nexant and Technomic Asia, all independent market research firms, to prepare reports for the purpose of providing various industry information and illustrating our position in the industrial biotechnology industry. According to CMAI, Cathay is the world’s largest producer of biobutanol based on active production capacity in 2011.
The biobutanol production facility in Jilin Province has an annual production capacity of 100,000 metric tons of biobutanol and co-products, including 65,000 metric tons (21 million gallons), of biobutanol and utilizes multiple continuous fermentation bioreactors, designed and constructed by its in-house team, at a scale of 1.8 million liters (475,000 gallon), per bioreactor.
In the F-1, Cathay said that in 2010 it sold more than 18,500 metric tons of biobutanol (6 million gallons) in China. As it continues to lower the production cost of biobutanol, it expect to first expand its market usage as a basic chemical building block and subsequently to sell it as a drop-in gasoline blendstock.
The company will begin pilot stage testing of its proprietary cellulosic biobutanol bioprocess technology by the end of 2011. It also plans to begin construction of a cellulosic biomass processing facility adjacent to the current biobutanol production facility to commercialize biobutanol from cellulosic biomass.
Cathay says it plans to expand the annual production capacity at the biobutanol production facility to 200,000 metric tons of biobutanol and co-products, including 130,000 metric tons, or 42 million gallons, of biobutanol, in the future. Cathay believes that using cellulosic biomass feedstock will significantly lower its production cost for biobutanol.
Cathay’s industrial biotechnology platform integrates strain development, fermentation scale-up and purification. Cathay licensed more than 200 strains of Clostridia previously used in commercial biobutanol production. It used its mutagenesis and screening techniques to develop a proprietary commercial strain capable of converting corn starch instead of dry milled whole corn to biobutanol. Use of corn starch instead of whole corn allows it simultaneously to capture all co- and by-products produced during the bioprocess including co-products bioacetone and bioethanol, and corn and biogas by-products, thereby reducing production costs and capturing additional revenues.
For the cellulosic biobutanol program, Cathay has developed a proprietary inhibitor-tolerant strain that is able to use crude biomass hydrolysate as feedstock, eliminating a key purification step while demonstrating comparable yields close to its commercial starch strain, the company says.
Cellulosic biomass plants in Jilin Province are currently using sulfuric acid-based hydrolysis in low capital expenditure facilities to break down cellulosic biomass, primarily into C5 sugars. Cathay says it has improved this commercialized technology and is able to break down cellulosic biomass into both C5 and C6 sugars and to recover the acid.
(The process Cathay has developed separates lignin from fermentable sugars. The company plans to use this lignin as boiler fuel to reduce its utility costs. As an aromatic hydrocarbon, lignin also has the potential value-added use as a primary hydrocarbon feedstock in the future.)
The inhibitor-tolerant strains have high yields using both C5 and C6 sugars as feedstock. As one example, the company says it has developed an inhibitor tolerant biomass strain which is able to achieve approximately 28.5% ABE conversion yield using pure glucose as feedstock; 30.8% ABE yield using pure xylose as feedstock; 33.7% yield using pure sugar mix of glucose, xylose and arabinose as feedstock; and 35.5% yield using crude biomass hydrolysate as feedstock.
This 35.5% yield using crude biomass hydrolysate as feedstock is higher than the 20.6% yield necessary to achieve breakeven operating profit, Cathay says, based on its average ABE selling price without VAT and its ABE production costs in the three months ended 31 March 2011.
To supplement its continual strain development program, Cathay recently entered into a technology license and exclusive consultancy contract with Elcriton. This licensed technology is expected to improve biobutanol yields from starch or glucose using Elcriton’s genetically engineered Clostridia strain.
If this strain meets yield targets, Cathay said, the genetic engineering tools used to produce the strain will be applied to enhance the performance of Cathay’s strains. Elcriton evolved out of the laboratory of Prof. Terry Papoutsakis, who has worked on metabolic engineering of Clostridia for more than 25 years and received the 2010 International Metabolic Engineering award for contributing to the production of biobutanol through the metabolic engineering of Clostridia.