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Beta Renewables and Novozymes to form strategic partnership in the cellulosic biofuel market; Novozymes takes 10% stake
29 October 2012
Novozymes, the world’s largest producer of industrial enzymes, and Beta Renewables have agreed to market, to demonstrate and to guarantee jointly cellulosic biofuel solutions. Beta Renewables is a $350-million (€250-million) joint venture formed from the Chemtex division of Gruppo Mossi & Ghisolfi and TPG focused on the development and broad licensing of the PROESA enzymatic hydrolysis technology. (Earlier post.)
As part of the agreement, Novozymes will acquire a 10% share in Beta Renewables, paying approximately $115 million cash for the equity, marketing fees, other intellectual property rights and milestone payments.
The partners will offer customers looking to produce biofuels from agricultural residues, energy crops and other cellulosic feedstocks a combination of Novozymes’ Cellic enzymes and Beta Renewables’ PROESA engineering and production technology. Beta Renewables will embed Novozymes’ enzymes in the PROESA technology and guarantee biofuel production costs upon start-up of customers’ cellulosic facilities. The deal is distinctive in offering a combined solution that reduces the risk in customers’ projects while providing competitive commercial terms.
This type of complete offering will significantly de-risk cellulosic biofuel projects financially as well as technologically for our customers. It will make cellulosic biofuel projects bankable and accelerate large-scale commercialization of the industry.
This agreement has double value: It demonstrates the full integration of the PROESA process with the enzyme technology and allows Beta Renewables to guarantee a full lignocellulosic cost.—Beta Renewables’ Chairman and CEO, Guido Ghisolfi
Beta Renewables is an extremely committed industry front-runner. They are building advanced biofuel facilities all over the world and, by being their preferred enzyme supplier, Novozymes will gain access to significant new business opportunities. We expect Beta Renewables to be able to contract 15-25 new facilities within the next three to five years. The sales potential for Novozymes from these plants could be up to $175 million.—Peder Holk Nielsen, Executive Vice President at Novozymes
In the last five years, Beta Renewables has invested more than $200 million (€140 million) in development of the cost-competitive PROESA process. PROESA will be used at the world’s largest cellulosic ethanol plant in Crescentino, Italy, where operations are expected to start by the end of 2012. The plant will initially produce 13 million gallons (50 million liters) of ethanol per year from wheat straw, energy crops and other locally available feedstocks. It has a design capacity of 20 million gallons (76 million liters) per year.
Beta Renewables has also secured a deal to build at least one manufacturing plant in Brazil with GraalBio, and, recently, Gruppo Mossi & Ghisolfi received a $99-million loan guarantee from the US Department of Agriculture to construct Project Alpha, a cellulosic biofuel plant in North Carolina.
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