Sub-$2/gallon biobased hydrocarbon fuels head for diesel-hungry India

May 24, 2016 |

BD TS 052516 CRI smIndia’s SunLight Fuels licenses IH2 Technology for hydrocarbon transportation fuels from agricultural waste

In India, Sunlight Fuels has signed a Front End Loading license agreement for IH2 Technology with CRI Catalyst, a division of Shell.

Project details

The Sunlight Fuels agreement is the first IH2 FEL-2 license granted in India for a commercial scale plant. The plant will be designed with the potential to convert 500 tonnes/day of dry bagasse into approximately 150 tonnes/day of liquid hydrocarbon transportation fuel.  Bagasse is the fibrous residue remaining after the extraction of juice from the crushed stalks of sugarcane. Because only the inedible residue is used in the IH2 process, there is no direct competition between food and fuel.  The plant is being engineered to sit adjacent to an operating sugar mill, with only the residual bagasse entering the new IH2 process facility.

What is the IH2 technology, anyway?

The IH2 technology is a thermocatalytic conversion route for woody biomass and forest residues feedstock that has been estimated to produce drop-in renewable fuels at around ~$2.25/gallon (in 2014 dollars), based on a 2000 tonne dry feed/day scale on a USGC basis using a stand-alone design basis. The technology was initially developed by the Gas Technology Institute and CRI came in, initially for the catalyst sales opportunity, but expanded its role after digging into the technology.

NREL determined in 2012 that a 2,000-ton/day wood-based, greenfield plant would have a CAPEX of $232.8 million. The minimum sales price needed to provide overall IRR of 10% on top of 60% financed at 8% was calculated to be $1.76/gal with wood at $71.97 per dry ton.

SO, in this project example, based on bagasse, the feedstock cost that formed 55% of the OPEX, according to NREL, melts away.

IH2 technology was developed for wood, will it work with bagasse?

That’s a yes. The IH2 process is effective with seaweed, aquatic plants, algae, bagasse, corn stover and municipal solid waste. CRI’s elemental analysis provides a hydrogen to carbon atomic ratio which correlates with both the liquid fuel yield and liquid fuel quality. For example, the H/C ratio for wood is 1.4. But CRI determined that micro algae check in at 1.7, macro algae at 1.6, lemna at 1.5, corn stover at 1.5 and bagasse at wood-equivalent 1.4.

The big diesel-side market in India

The diesel market in India is estimated at 25 billion gallons per year, based on a 2015 Government of India commitment to purchase up to 225 million gallons per year of biodiesel, which they said would be a major step towards meeting a 5% biodiesel blend policy and target of 250 million gallons.

And what exactly is a FEL?

The Construction Industry Institute defines it as “the process of developing sufficient strategic information for owners to address risk and decide to commit resources to maximize the chance of a successful project.” This process generally encompasses three sub-phases: feasibility, concept, and detailed scope. In short, it’s a first step major companies take on major projects to ensure they’re not getting in over their heads. Why significant in this case? The good news is that the IH2 technology has passed the first gate en route to hydrocarbons from bagasse.

What does the IH2 technology produce?

Commercial volumes of ASTM-spec renewable gasoline, jet and diesel. In the 2000 ton per day reference example, think something like a 60 million gallon nameplate capacity, based on 90% uptime.

The yields

In 2014, CRI said that “research shows the IH2 process can produce up to 92 gallons of liquid fuel per ton of wood feedstock (on a dry, ash-free basis). This totals 184,000 gal/day.”

However, by late 2014, the company had modified this to a 67-72 gallon range. The gasoline: diesel ratio would be expected to be 70:30. Product oxygen is below detectable limits and the total acid number or TAN is less than 0.03. By contrast, traditional pyrolysis oils have a TAN in excess of 100.

So, think in terms right now of a 28% yield with wood as the feedstock and with the current generation of catalysts. With each new generation, yield is expected to increase. Also, the boiling point curve can be moved, which allows one to shift the ratio of the product one produces, e.g, more gasoline or more diesel.

IH2 deep-dive

We took an in-depth look at the tech, the economics and the prospects, here.

Affordable, drop-in hydrocarbons from wood: The Digest’s 2016 8-Slide Guide to CRI/GTI’s IH2 process

The SunLight backstory

SunLight Fuels’ founders have experience in feedstock sourcing, preparation, technology and operations, oil and gas engineering and financial services.  The IH2 technology license to SunLight Fuels is the first license to be issued for a plant engineered to process bagasse.  India, as the world’s second largest bagasse producer, is positioned to benefit from utilizing this sustainable resource.

The FEL-2 engineering package is being completed for the green-field IH2 process plant by KBR, CRI’s exclusive FEED engineering services provider.

SunLight’s key managers are Nishant Singhal and Sunil Singhal — Sunil is a principal in Chemical Systems Technology, billed as “the largest sugar processing chemical manufacturers and processing technology supplier in India,” and maintaining strategic alliances with BASF and LANXESS. The company offers specialty process chemicals, process technologies and turn-key supply of complete sugar plants.

The CRI backstory

CRI Catalyst Company LP is part of CRI/Criterion Inc., the global catalyst technology company of the Shell Group.

More on the story.


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