KiOR: The inside true story of a company gone wrong

The road to the 67 gallons per ton claim

In 2006, renewables were in the air.

In mid-June, VeraSun Energy went public selling 18.25 million shares at $23 per, raising $425 million. Shares of the already-public Pacific Ethanol doubled by late spring, despite the company not opening its first plant until the end of the year. Hawkeye and Aventine went public at sky-high prices. Congress was planning a vastly expanded Renewable Fuel Standard.

By late June, Khosla Ventures entered into biofuels in a big way, forming a venture called Cilion to operate modular 55 million gallon ethanol plants, aiming to build 8 by 2008, the first three in California.

Several months prior, in the Netherlands, Paul O’Connor had taken note of the trends as well. He had been serving as a Business Development Manager at Albemarle Catalysts after Albemarle bought the catalyst business from AkzoNobel. This, on top of 20 years at Akzo, culminating in work as the worldwide development manager for FCC catalysts.

The key here is the FCC unit — a fluidized catalytic cracker. It’s a standard unit at more than 400 oil refineries worldwide; one-third of the world’s crude oil is processed in a FCC reactor.

The use of synthetic zeolites and their modified forms, as FCC and hydrocracking catalysts, has revolutionized the petroleum refining business. The use of zeolite-based FCC catalysts has made possible to achieve substantially higher conversion yields of gasoline and diesel fuel from each barrel of crude oil refined.

As Wikipedia explains:

Fluid catalytic cracking is widely used to convert the high-boiling, high-molecular weight hydrocarbon fractions of petroleum crude oils to more valuable gasoline, olefinic gases, and other products. Oil refineries use fluid catalytic cracking to correct the imbalance between the market demand for gasoline and the excess of heavy, high boiling range products resulting from the distillation of crude oil.

With the popularity of biomass-related ventures in 2006, the question had become, as former KiOR process engineer Lorenz Bauer explained to The Digest, “Could you send [biomass] up real fast with a catalyst into a FCC reactor?” But he adds, “Anyone who thinks it’s simple is kidding.”

There were five basic scientific questions. 

1. Could the biomass be sufficiently pretreated, and how, to become FCC-compatible?

2. Could a catalyst be designed to work with biomass and achieve similar results to catalysts working on petroleum hydrocarbons?

3. What would the reactor look like?

4. Would any resulting bio-oil contain too much oxygen to be refined into a fuel using standard refinery equipment?

5. Could all of the above be achieved by a design that was economical?