Clariant has called time on its 2G bioethanol project in Podari, Romania.
What was supposed to be a showcase for the yield and efficiency of its in-house sunliquid® cocktail of enzymes and microorganisms, and a launchpad to global licensing agreements, has ended in failure. Clariant explored various options including a sale, but no buyer came forward and the site will now be closed two years after starting up. It expects to take a CHF60-90 million hit from closing and downsizing operations, plus book a non-cash impairment of about CHF110 million.
The Swiss company is not alone.
Despite the high hopes for the 2G bioconversion industry, it’s struggling to deliver on its full potential. On paper, it offers something that a lot of other renewable technologies like wind cannot provide: transforming cellulose-based, non-edible biomass and crop leftovers into fuels and chemicals.
While there are 2G plants making headway, there have been numerous failures since the first plant began commercial-scale production a decade ago.
Clariant took the bold decision to build its own sunliquid plant as a proof of concept in 2017, using wheat straw as a feedstock. Podari has plentiful supplies and Clariant persuaded local farmers to drop off their unused straw bales. Shell signed a multi-year agreement to take the entire offtake.
The thinking was bioethanol could be used to help fuel cars in a “quick and very effective of reducing greenhouse gas emissions.”
Today, Clariant concluded it couldn’t bear the mounting losses and the significant further outlay to ramp up the Podari facility. The origins of the sun liquid® enzymatic process date back to 2006 and a lab operated by Süd Chemie, a catalyst company that Clariant acquired in 2011. A pilot plant was commissioned at the research centre in Munich in 2009, followed by a demonstration plant in Straubing in 2012.
“It is imperative to take firm decisions when a project does not fulfil expectations,” CEO Conrad Keijzer said in a statement.
There are other 2G projects out there that are still progressing.
Ryanier Advanced Materials plans to begin commercial production of its 2G bioethanol plant in Tartas, France in the first half of 2024 and the US company has already entered a long-term off-take agreement with a “large international petrochemicals company” to purchase the output. This partner even provided a “significant” portion of the investment via low-cost green loans.