American Process: Biofuels Digest’s 2014 5-Minute Guide

Company overview:

Although American Process has been most closely associated with its complete cellulosic biofuels package — of late, the company has been much in focus because of its capabilities in producing low-cost renewable sugars.

Thought it was a matter of making sugars and shipping them to an ethanol producer? Think again. In this case, there are opportunities for butanol and ethanol conversion from xylose and mannose. But glucose is expected will go to the sugar markets and to chemical processors.

So, American Process highlights the advantages in co-locating with power plants for power & heat. In short, there’s an industrial symbiosis building up — where you can see power, renewable sugars separators, fuel biorefineries and chemical plants potentially sharing a central location, close to biomass feedstock and rail logistics.

Rankings

50 Hottest Companies in Bioenergy: #37, 2013-14

The Situation

American Process came through on a Q2 2013 startup of its demonstration project that will handle up to 10 tons per day of biomass, and producing up to 300,000 gallons per year of cellulosic ethanol.

AVAP (American Value Added Pulping) co-produces pulp and ethanol from biomass in an integrated biorefinery application. Biomass is converted to sugars using a two step proprietary process. In the first step biomass is quickly broken-down into its three major components: cellulose, hemicelluloses and lignin. In the second step, hemicellulose is hydrolyzed to sugars using heat and cellulose is hydrolyzed to sugars using enzymes. Lignin is removed and burned to produce the energy required to run the process.

Last month, API president Basil Karempelas told Ethanol Producer, “Our plan for both Thomaston and Alpena for the remainder of 2013 is to really perfect and optimize the two technologies at the demo facilities.

Last spring, GranBio Investimentos announced plans to invest $724.5 million in five cellulosic ethanol plants during the next few years and took a 25% stake in American Process.

The first 21.6 million gallon GranBio facility in Alagoas that will use sugarcane bagasse as feedstock is expected to come online in early 2014. The first plant will produce cellulosic ethanol from sugarcane bagasse and straw, and Novozymes will supply the necessary enzyme technology while Beta Renewables and Chemtex, both part of Italian chemical group Mossi & Ghisolfi (M&G), will provide other process technologies and engineering.

GranBio is guiding now that “the 2G ethanol plant being built in Alagoas should begin operating in early 2014 with a nominal production capacity of 82 million liters per year.” Meanwhile, Sugaronline News is reporting that “the Bioflex unit, a division of GranBio in Alagoas state, confirmed it would inaugurate next week its first experimental planting of energy cane production in Alagoas. The crop will be in the city of Barra de Sao Miguel, and be ready for harvest in the first quarter of 2014.”

CEO Theodora Retsina sums it up:

“For us, there are five important lessons learned. First, leverage co production wherever you can, and don’t build anything you don’t have to. Second, understand that there is real risk, and perceived risk, and only operating a large demonstration that you keep as simple as possible, will allow you to understand the risks.

“Third, there’s the execution risk, and we have found that it is paramount to keep in-house control of basic engineering and construction management.

“Fourth, a lack of stable policy has great impact. Fifth, in financing, you have to look everywhere, conventional and unconventional.

Type of products produced:
Ethanol, industrial sugars

Major investors.
GranBio

Past milestones:

1995 – Founded as an Energy Consulting Company serving the Pulp and Paper Industry

1995-2004 – Energy Consulting Provider: 400 projects, 140 Mills

2002 – Built and operated cogeneration “across the fence” plants

2005-2010 – Performed Biorefinery R&D at lab & pilot site – Operated two labs in Atlanta  at the Georgia Institute of Technology

2007-2010 – Sponsored biorefinery R&D consortia and university research (NCSU, WERC, SUNY, TEKES, GaTech, Michigan Tech)

2008 – Developed Process Development of Red Shield DOE awarded process

2009 – Developed apiMAX™ biorefinery simulator – read more…

2009 – Formed JV with Sniace for cellulosic ethanol plant in Spain

2010 – Built EPCM AVAP Demonstration Plant in Thomaston, GA and filed 22 biorefinery patent applications

In 2010, American Process was awarded an $18M DOE grant for the development of the Alpena Biorefinery to be built at the Decorative Panels International mill in Alpena, Michigan. The project has also received a $4M state grant from the Michigan Center of Energy Excellence.

In April 2013, at the Advanced Biofuels Leadership Conference (ABLC 2013), GranBio completed the acquisition of a 25% equity stake in American Process. Under the agreement, GranBio said it will have gained access to a proprietary biomass pretreatment platform that makes it possible to cost-effectively develop cellulosic sugars as a feedstock to a range of biochemicals and biofuels. The companies said that they expect to break ground on their first commercial-scale facility by the end of 2014. The companies will collaborate on a first commercial facility with API technology in Brazil, followed by one in the United States. Between now and then, American Process will complete demonstration activities on targeted feedstocks at its demonstration-scale plants in Alpena, Michigan and Thomason, Georgia.

Future milestones:

GranBio’s next-gen cellulosic ethanol plant in Alagoas, is expected to commence operation in early 2014 with a nominal capacity of 22 million gallons (82 million liters). GranBio is investing $R350 million in the project. The project is now 30% complete, Gradin confirmed to the Digest.

Business model:

Licensor.

Competitive edge:

API’s Retsina pointed towards technical capabilities, especially the technology’s capabilities of separating three distinct fractions from softwoods — cellulose, hemicellulose, and lignin. “Softwoods are very recalcitrant and difficult to work with, but 90% of the sugars in the hemicellulose are C6 and that is a distinct difference from other wood, not to mention the plentiful supply of softwood, for example across the southeastern US. Softwood is abundant and today is in surplus — and it’s been one of the myths that, with hemicellulose, you typically have C5 sugars – that’s not the case with softwoods.”

“The investment in API marks GranBio’s entry into the North American cleantech market, said GranBio president Bernardo Gradin. “It is a strategic move by the company, since the pretreatment solution developed by API enables the production of low cost cellulosic sugars, which also fulfill the stringent requirements required for manufacturing biochemicals. With this platform, we will be able to expand GranBio’s activities to other products, beyond cellulosic ethanol.”

“The association with a demonstrated cleantech leader like GranBio strengthens American Process,” said API CEO Theodora Retsina. “Sugar is the new crude — the production of low cost clean sugars is key to unlocking the potential of biomass as a versatile feedstock for fuels, chemicals and bio-products. We are actively partnering with “sugar converters” to complete the supply chain and convert sugars to high margin products.”

Development stage:
Demonstration.

Company website