KiOR: The inside true story of a company gone wrong

“A Recipe for Technical Failure”

In the summer of 2008, Dr. Jacques De Deken, a Technology Director, who had flagged the problem of the bad ITQ results to key scientific team members, raised a red flag to management. He indicated his view that the KiOR BCC Technology was not on track to produce at commercially viable qualities or yields, and that KiOR must make a drastic change both of the process and the catalyst.

According to sources familiar with the company’s activities at the time, Cannon and O’Connor agreed to discount De Deken’s findings, and reject his recommendation to change the process and the catalyst.

There are two versions of De Deken’s departure from KiOR. In the state of Mississippi’s lawsuit against KiOR, the state contends that De Deken was a KiOR consultant, who resigned from the Company in September 2008. The state contends that “Vinod Khosla discussed with De Deken the reasons for his departure and requested that De Deken provide a written memorandum…Khosla forwarded DeDeken’s critique to Cannon on October 13, 2008.”

However, the letter of resignation has subsequently come to light. In fact, De Deken was a KiOR employee rather than a consultant, and his last day in the office was August 11, 2008. On that day, De Deken provided directly to O’Connor and Cannon a detail of his objections. In part, scientific. But in another aspect, cultural.

“I was hired by KiOR as its Director of Technology,” De Deken wrote, “with the understanding of being responsible for all of KiOR’s process development and engineering activities.” De Deken protested that after 5 months of employment, “KiOR is in breach of our agreement”.

He stated that “the strategy in rushing towards demonstrating the BCC technology at a multi-barrel-per-day scale without corroborating experimental data, under the pretense of self-deception of ‘creating value’, is a recipe for technical failure. Indeed, I do not believe that we currently have the experimental results, catalyst(s) or science base to justify the rush and expense of an LPBCC unit or demonstration in the Ivanhoe facility at this time.”