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Gevo contracts with Arabian American Development to develop hydrocarbon materials from its renewable isobutanol

Arabian American Development Co. (ARSD) has signed a contract with Gevo, Inc., a renewable chemicals and advanced biofuels company, to build a renewable hydrocarbon processing demonstration plant at ARSD’s South Hampton Resources, Inc. subsidiary in Silsbee, Texas and to provide Gevo with toll-processing services necessary to process up to 10,000 gallons of Gevo’s renewable isobutanol per month into a variety of hydrocarbon materials.

These materials include jet fuel, isooctane for gasoline, isooctene and paraxylene for polyethylene terephthalate (PET). This will allow Gevo to supply early adopters with product so they can test material, make samples and start their selling cycle.

The contract is for two years with one-year extensions thereafter. The demonstration plant is slated for completion before the end of 2011. South Hampton Resources will complete the final design and engineering package for the demonstration plant from preliminary plans supplied by Gevo and will incur incidental costs related to site preparation and tie-ins.

This contract is the successful culmination of one of several toll-processing opportunities on which we have been working. Gevo is developing exciting new technology and we’re pleased to be part of this value chain. We believe this is a sustainable partnership as Gevo expects to demonstrate the viability of renewable hydrocarbons in a variety of market applications. That would pave the way for a larger market development plant, which, in turn, expands opportunities and should drive additional demand for our toll-processing services. In addition, the new processing facility will continue to expand our capabilities into the renewable energy market. Our largest contributor to date in this field is our C5 product that is being utilized as the working fluid in closed loop geothermal generators with a top US geothermal company.

—Nick Carter, ARSD President and CEO

The Silsbee facility presently consists of six operating units which, while interconnected, make distinct products through differing processes: (i) a Penhex Unit; (ii) a Reformer; (iii) a Cyclo-pentane Unit; (iv) an Aromax Unit; (v) an Aromatics Hydrogenation Treating Unit; and (vi) a White Oil Fractionation Unit. All of these units are currently in operation. The capacity of the facility’s processes when taken in total is approximately 6,400 barrels per stream day.

The facility generally consists of equipment commonly found in most petroleum facilities such as fractionation towers and hydrogen treaters except the facility is adapted to produce highly specialized products that are high purity, highly consistent, precise specification materials utilized in the petrochemical industry as solvents, additives, blowing agents and cooling agents.

South Hampton produces eight distinct product streams and markets several combinations of blends as needed in various customers’ applications. South Hampton produces neither motor fuel products nor any other commodity type products commonly sold directly to retail consumers or outlets.

ARSD also is the original developer and now a 37% owner of Al-Masane Al-Kobra Mining Company (AMAK), a Saudi Arabian joint stock company which is in the final stages of development in Najran Province of southwestern Saudi Arabia. The mine is scheduled to be in production in early 2012 and will produce economic quantities of copper, zinc, gold, and silver.

In April, Gevo signed an engineering and consulting agreement with Mustang Engineering, LP for the conversion of its renewable isobutanol to biojet fuel. This effort will focus on the downstream processing of isobutanol to paraffinic kerosene (jet fuel) for jet engine testing, airline suitability flights and advancing commercial deployment. (Earlier post.)

Comments

HarveyD

At les than 10,000 barrel/month, this must be a pilot project?

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