02 April 2012 00:00 [Source: ICB]
Several companies are looking to develop bio-based glycols alongside their biofuels ventures, using glycerine or corn as feedstock
A merging of horizons is on the way for oil- and gas-based petrochemicals and bio-derived chemicals, as environmental initiatives such as the Renewable Fuel Standard 2 (RFS2) issued by the US Environmental Protection Agency (EPA) gain traction in 2012.
Petrochemicals have been around for a long time, but biomass-derived products were not highlighted for development during the formative years of the chemical industry. A few bio-based products are found in more niche segments, such as oleochemicals. In this industry, natural fats and oils, such as vegetable oil, form feedstocks for commercially viable products including fatty acids and glycerine.
Corn and glycerine are being used for feedstock for glycols
Biofuels came first, heralding the entry of ethanol and biodiesel into the massive arena of the US gasoline and diesel fuel markets and firing off any number of debates, ranging from the use of food crops for fuel to whether or not biofuels could perform properly.
While those debates are not completely resolved, biofuels are mandated and are becoming part of the fabric of domestic US and global fuel and energy resources.
ADM initially focused on biodiesel production, but in 2007 began to investigate a bio-derivative: "green" propylene glycol (PG), using biodiesel's co-product glycerine as a feedstock. Today, ADM's 100,000 tonne/year "green" PG plant at Decatur, Illinois, is routinely operating at undisclosed capacity utilization rates, sufficient to cause the company to exit as a seller from the US Pharmacopeia (USP) refined glycerine market in January 2012 and enter as a potential net buyer.
Another firm, Global Bio-chemical Technology Group (Global Bio-chem), is making "green" PG from corn-derived sugars, such as glucose and pentose, in a carbohydrate-to-glycols process, according to Jeff Mahaffey, chief operating officer for the company.
Hong Kong-based Global Bio-chem, a vertically integrated corn-based products manufacturer, is also aiming at 2012 commercial production of bio-ethylene glycol (EG) via the same carbohydrate-based process, with additional plans to produce bio-butanediol. Global Bio-chem has a 200,000 tonne/year "green" PG plant in Changchun, Jilin Province, China, that has been operating since 2007.
Globally, on a commercial volume and product-by-product basis, bio-derivatives are still few in number - basically PG and epichlorohydrin (ECH), produced from glycerine, as is being done at Belgium-based Solvay's 100,000 tonne/year ECH plant in Thailand and by epoxy resin producer Spolchemie in the Czech Republic. But as these bio-derivative facilities show, they can sustain viability and fresh initiatives and new plants can follow.
Comparing bio-based materials with the analogous petrochemical ones is unwieldy, as there are several different bio-based products and basically only one on the petroleum side.
US petroleum-based PG contract prices were assessed in early March at 81-87 cents/lb FOB east of the Rockies for industrial grade material and at 87-93 cents/lb for USP PG, same basis. Petroleum-based feedstock crude oil costs, tracked at plus-$100/bbl in early March, are expected to remain pressured by ongoing geopolitical issues.
"Green" PG prices were not available, with most of the product being sold via undisclosed contracts, according to market sources. Its feedstock is refined glycerine. March contract prices for vegetable-derived material were assessed at 41-48 cents/lb FOB midwest, but ADM's costs are not from a contract perspective. ADM is integrated to soybean production, with crude glycerine available from its biodiesel production streams and glycerine refining capability via the same infrastructure.
It would be extravagant to say "the race is on" between petrochemicals and bio-derivatives. Bio-derivatives may not reach into every product slate in the petrochemical groups. But as the bio-derivative products filter into commercial markets, then competition and co-existence can be expected.
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