Braskem and Genomatica announced an agreement for the joint development of commercial process technology to make bio-based butadiene from renewable feedstocks. Braskem is the world's leading producer of biopolymers and the world's third largest producer of butadiene.
Under the agreement, Braskem anticipates providing significant funding of Genomatica's development work over several years; will allocate significant Braskem R&D resources; and fund the construction and operation of pilot and demonstration-scale butadiene production plants using the process. In return, Braskem will receive certain exclusive license rights to use the resulting process technology in the Americas. Genomatica will also receive fees and royalties for each licensed commercial plant.
"Braskem has a clear strategy for investing in the research and development of renewable based chemical technologies as alternatives to complement our current product portfolio based on petrochemicals. In 2012, we became the world leader in Biopolymers when we announced the production of plastic made from sugarcane, and we are now further reinforcing this vision," said Alexandre Elias, director of renewable chemicals at Braskem.
"Braskem's leadership in biopolymers and understanding of the potential of biotechnology make them a natural partner for Genomatica," said Christophe Schilling, Ph.D., CEO of Genomatica. "Our partnership brings the industry closer to commercializing a more sustainable and cost-predictable butadiene."
Further accelerates Genomatica's butadiene program; extends geographic reach
The new agreement adds significantly to Genomatica's butadiene program, which now includes investments of over $100 million anticipated under current agreements. Program milestones already include the successful production of pounds of butadiene in 2011, and funding from Versalis for Genomatica's development efforts announced in April 2013.
The combined strength of current and future program partners will facilitate aggressive pursuit and delivery of commercial-grade process technologies for licensing to and use by the global chemical industry, using a range of feedstocks. The agreements with Braskem and Versalis provide a commercialization path in all major butadiene-producing and consuming regions of the world.
Genomatica, with 71 issued patents and 450 additional patent applications, has been applying its intellectual property and technology platform to develop multiple approaches for the commercial production of bio-based butadiene, using multiple renewable feedstocks. Partners in Genomatica's butadiene program will gain specific access to a range of the resulting technologies.
Significance: strategic alternative for huge market
Butadiene, with a worldwide market demand of over 20 billion pounds per year, is a raw material used in the production of rubber for tires, electrical appliances, footwear, plastics, asphalt modifiers, additives for lubricating oil, pipes, building components, and latex.
The supply of butadiene, an important 'C4' chemical, has been decreasing due to a long-term shift to natural gas at petrochemical 'cracking' plants, and a scarcity of dedicated, 'on-purpose' production processes and facilities. This has resulted in substantial pricing volatility, which in turn impacts butadiene-based products, including tires. The butadiene process being developed by Genomatica and Braskem is expected to provide an economically competitive and environmentally-friendlier alternative, while providing a strategic alternative to the use of petroleum-based feedstocks.