Breakthrough in biodiesel: Duonix Beatrice reaches commercial-scale, with signature advances in cost-reduction, feedstock flexibility

September 22, 2016 | Jim Lane

bd-ts-092316-sm The most important technological advance in biodiesel in recent years has reached commercial-scale in Eastern Nebraska, with the startup of the Duonix Beatrice biodiesel plant, which is and the first commercial-scale application of Benefuel’s innovative ENSEL technology. ENSEL technology is capable of converting a range of lower cost feedstocks such as recycled cooking oil and distillers corn oil into high-quality biodiesel.

The technology story

ENSEL is a one-stepper that does esterification and transesterification in one step, and it uses a solid catalyst. No soap formation, improved process efficiency, and expanded feedstock optinos in the high free fatty acid range. Only REG has been bringing forth anything like this in terms of technical advance that opens up feedstock options — and look how fast REG has been growing.

Partners in the new plant are Flint Hills Resources and Benefuel.

Once fully operational, the Duonix Beatrice plant will produce approximately 50 million gallons of biodiesel annually. The plant has already made commercial sales of product that meets or exceeds ASTM specifications for biodiesel.

The competitive advantages

Well, there are two. One, accessing a lower-cost feedstock.

Second, enhanced performance. Especially with corn oil, “which is excellent cold weather oil ,” says Rob Tripp, “even better than soybean oil.” But think impurities as well. “Most soy biodiesel production doesn’t have backend distillation units,” Tripp added, “and that’s where you get uncoverted material such as saturated monoglycerides, and distillation is what removes that impurity. SO we have better downstream purification.”

For now, Beatrice is in the middle of corn country. So think “distiller’s corn oil” as a primary feedstock for the start-up period. But there’s plenty of beef tallow, too, in Eastern Nebraska, and the technology handles that fine.

Other feedstocks? For sure, the technology makes it possible to use palm fatty acid distillate, and that’s led to a partnership with Felda to build a plant in Malaysia. There. the partenrs acquired the old Mission NewEnergy plant and have completed “quite a bit of engineering” towards that retrofit.

The Flint Hills perspective

“We are an operating company,” said Jeremy Bezdek, vice president of Flint Hills Resources Biofuels and Ingredients. “We run oil refineries, ethanol plants: that’s what we do, and so we bring not only the strong balance sheet, but the strong operating and marketing capability.

“I started buying biodiesel in a former role with FHR, back when the Minnesota mandate first appeared in 2003,” Bezdek told The Digest. “Even back then, we all saw the pitfalls of taking a feedstock that could cost more than the product. What everyone would have wanted was a true multi-feedstock technology. So we’ve been highly interested in new tech, and I remember the day when Rob and Benefuel first walked in the door.

“So I happened to be there at the beginning, and now here at the end of the development. But what is very interesting to us is that we are at very beginning of the commercialization.”

“Had we been operational over the last months we would have made excellent margins, and that was the bet all along. DCO was is the primary feedstock in all our economic cases, but we also have fairly good tallow options in Eastern Nebraska when the feedstocks price themselves right. At first here we’ve just used DCO to simplify the start-up.”

So, why this, why now?

“I think that everyone is probably pretty familiar with our philosophical position, that we would continue to support the elimination of biodiesel tax cedit and RFS2,” Bezdek told The Digest. “Now, clearly those exist and we’ll play in those markets so long as they continue to exist. For example, we will ship to California, where the LCFS is in place and there’s a further advantage. But we would not have got far here within FHR if we had we needed to rely on those supports.”

Post-mandate biodiesel

So, how does Duonix stack up, then, head to head against petroleum, we asked.

“We believe that this technology can stack up against petroleum diesel.“ Bezdek said, “whether there’s a subsidy, mandate or not. I don’t believe all biodiesel technologies would survive without mandates and subsidies, but we see this working even in a no mandate environment.”

Even in a low price environment?

“Clearly we would do better with higher price crude, but we see value today,” Bezdek noted. “For sure, it is much less of an opportunity at the moment, but we’re still positive. And when I was in an Innovation role with the company, we did a pretty deep dive on techs in this space, and this technology stood out for us as having an advantage over all the others.

How long does it take?

“Back in 2008 I met a guy who was doing insitu coal gasification and had just started his first commercial, said Bezdek. “He told me that ‘in this business, overnight success is 10 years,’ and I thought to myself, this guy is crazy. But here we are more than five years later, so I don;t think that was so crazy after all.”

Overall, it’s been a six-year journey. Since 2010, Flint Hills Resources and Benefuel have worked together to test and validate the ENSEL technology for commercial-scale production. Flint Hills Resources acquired the Beatrice biodiesel plant in 2011. The plant was originally built in 2008, but was not finished and never operated. In May 2013, Benefuel announced a joint venture with Flint Hills Resources, known as Duonix, LLC, to develop domestic biodiesel production capabilities. The Duonix joint venture was formed to leverage Benefuel’s leading ENSEL biodiesel refining technology with Flint Hills Resources operating experience and establish itself as a low cost producer in the industry. Duonix Beatrice is the first joint commercial venture from the companies.

The origin of the JV

“When we got into the JV with FHR,” recalls Benefuel CEO Rob Tripp, “we were a technology development company. We were different, and differentiated. We had a technology that could producing high-quality, cost-competitive biodiesel from a multitude of advantaged, non-edible feedstocks. What we didn’t have was commercial and operating expertise to grow a busienss. So, we partnered with Flint Hills, and we’ve relied on their experience ever since. It’s exciting to get first plant up and running, looking to add value through hopefully more projects.”

The Expansion Story

Now, the Duonix JV between Benefuel and Flint Hills, limited to the US. But FHR is an investor in the company as well, and would participate in the returns that way for technology commercialization outside the US. Such as the venture with Felda.

Would we see greenfields or retrofits, we asked?

“Right now, we are clearly focused on Beatrice,” said Bezdek, “and we have no defined set goals for expansion — but clearly there are opportunities for growth in the biodiesel market.”

“I don’t think there are a lot of great retrofit opportunities, at least in the US, said Bezdek. “We were lucky with Beatrice, but I expect that growth domestically will be more of a greenfield situation. But we would definitely consider more of a brownfiels, where we could utiize the logistics and tanks. But all the processing would be new.”