25 May 2012 19:22 [Source: ICIS news]
NEW YORK (ICIS)--US renewable chemical and biofuel company Gevo is maintaining a target price for its corn-based isobutanol at $3.50-4/gal in 2012 and expects its prices to go down in the next three years as it ramps up commercial production, the company’s chief executive said on Friday.
The company started retrofitting the plant last year with its patented Gevo Integrated Fermentation Technology (GIFT) system to be able to produce 18m gal/year of bio-isobutanol at full capacity.
“We actually expect the Luverne plant to ultimately produce more than the 18m gal/year capacity but we still have to go over those details,” said CEO Patrick Gruber, in an interview with ICIS.
Gevo expects to reach full capacity run rates by the end of 2013.
“Our goal right now is to produce isobutanol at a rate of 1m gal/month by the end of 2012. Our team did a great job sticking to our production milestone,” Gruber said.
Most of the bio-isobutanol produced at the plant will be shipped to South Africa-based chemical company Sasol. Gevo expects to ship the first railcars to Sasol by around 1 July.
“The product will probably go to the Gulf coast or wherever the customer wants it, and from there offshore around the world. We will work with [Sasol] to ensure the quality of our product during shipping wherever they decide where the isobutanol will go,” said Gruber.
Sasol is expected to use Gevo’s bio-isobutanol for solvents and other applications for specialty chemicals. Sasol has an initial three-year supply contract with Gevo. Generally, Gevo sets up its contracts so customers take possession of product at the plant gate, noted Gruber.
Gevo’s goal is to produce 350m gal/year of bio-isobutanol by 2015.
The company expects to start retrofitting another ethanol plant in Redfield, South Dakota, with capacity to produce approximately 40m gal/year of bio-isobutanol.
Start-up of this unit is expected in the second half of 2013, said Gruber.
Gevo has memorandums of understanding (MOUs) for additional ethanol plants but the timing of those plants will depend on how much production can be squeezed out of the Luverne and the Redfield plants, as well as matching the market need and timing, he added.
Future facilities are expected to each have capacities of around 100m gal/year, Gruber said.
($1 = €0.80)
For the latest on bio-based chemicals visit Doris de Guzman’s ICIS Green Chemicals Blog
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