## Velocys Awarded Commercialization Grant for Microchannel Reactor Technology for Hydroprocessing to Upgrade Fischer-Tropsch Fuels and Heavy Petroleum Feedstock

##### 28 May 2009

A collaboration led by Velocys, Inc., the US subsidiary of UK-based Oxford Catalysts Group PLC, has been awarded a $5-million, 2.5-year commercialization grant to apply Velocys’ microchannel reactor technology to hydroprocessing for transportation fuels. (Earlier post.) The project focuses on hydrocracking to upgrade Fischer-Tropsch fuels and heavy petroleum feedstock for jet and diesel fuel. Additional hydroprocessing application opportunities include the processing of edible oils, specialty and fine chemicals, and conversion of natural oils and fats to transportation fuels. Velocys, Inc. is working in collaboration with the Ohio BioProducts Innovation Center Wright Center of Innovation, Archer Daniels Midland Company, BP-Husky LLC Toledo Refinery, Albemarle Catalysts Company BV and NetJets, Inc. Successful commercialization of the hydroprocessing technology will enable better economics for the production of fuels from renewable biomass and biowaste, especially on a distributed small scale, as well as from smaller stranded natural gas reserves. The grant is part of the Ohio Department of Development’s Third Frontier Project, a$1.6-billion, 10-year initiative. The successful Velocys grant proposal was ranked highest out of 32 finalists by an independent review committee from the US National Academy of Sciences.

Oxford Catalysts Group acquired Velocys, Inc. from Battelle Memorial Institute in Ohio in November 2009 for $35 million,$5 million of which was in cash. Velocys is a leader in the design and development of microchannel process technology. (Earlier post.)

Oxford Catalysts said that the addition of hydroprocessing alongside its technologies for Fischer-Tropsch and Steam Methane Reforming will bolster the Oxford Group’s position in synthetic fuel technologies.

Oxford Catalysts designs and develops technology for the production of clean fuels from both conventional fossil fuels and renewable sources such as biowaste. The Group is primarily focused on the emerging market for distributed smaller scale production of synthetic fuels via Fischer-Tropsch—a market it says has the potential of producing as much as 25 million barrels of fuel a day.

The Fischer-Tropsch (FT) reaction is used when converting natural gas, coal or biomass into virtually sulfur-free liquid synthetic fuels. The Group is a designer and developer of high-activity catalysts and associated novel chemical reactors for the small scale production of synthetic fuels. The Group’s microchannel process reactor technology is marketed under the brand name of Velocys.

Other applications of the technology include hydro-desulfurization (HDS), the most commonly used process in the multi-billion dollar refining industry for the removal of sulphur from crude oil fractions. The Group has developed a novel class of highly active HDS catalysts with better performance characteristics than traditional catalysts.

Oxford Catalysts’ strategy is to license its technologies for commercial application by entering into co-development partnerships with leading manufacturers, producers and suppliers in the petroleum, alternative fuels and catalysis markets.

Resources

Five million \$ is very little. A good sign. Insanity rather than progress is the most common outcome of unrestrained funding.