KiOR locks up downstream deals for future biocrude
KiOR Inc. continues its aggressive push of securing downstream partnerships for its future biocrude-based products as the Pasadena, Texas-based company recently signed a fuel supply agreement with FedEx Corporate Services Inc. to provide renewable diesel blendstocks for purchase by affiliates of FedEx Corporate Services. The fuel will be produced at KiOR’s first commercial production facility, an 11 MMgy plant in Columbus, Miss., scheduled to come online in the second half of 2012.The agreement with FedEx is KiOR’s first with an end user of transportation fuels.
KiOR’s process involves a proprietary catalyst for “Fluid Catalytic Cracking,” a technique used in oil refining for years. It begins with woody biomass pretreatment and then uses a reactor system that produces the biocrude along with light water, gases and coke. After exiting the reactor, the biocrude is separated from the catalyst, which is sent to a regenerator for reuse after the coke product is burnt off. The biocrude is then separated from the gases and refined for use. The gases are used for power.
“We are excited to be working with a premier transportation company like FedEx,” said KiOR President and CEO Fred Cannon, who has 20 years of experience in the catalytic field and previously worked for AkzoNobel, a refining catalysts and specialty chemicals manufacturer that was sold to Albermarle Corp. in 2004, adding “this agreement with the services company of direct end users is another step toward delivering our fuel blendstocks to the market.”
Prior to the fuel supply agreement with FedEx, KiOR signed a conditional off-take agreement with Catchlight Energy, a 50/50 joint venture between subsidiaries of Chevron Corp. and Weyerheaeuser Co., for Catchlight Energy to purchase future gasoline and diesel fuel blendstocks also produced from its Columbus facility.
According to KiOR, Catchlight Energy’s purchase of future products is “contingent on, among other things, satisfaction of product specification criteria and RIN (Renewable Identification Number) certification of the products as cellulosic biofuels under the RFS2.” KiOR said in a statement that the companies have also signed a Testing and Optimization Agreement to optimize the compatibility of KiOR’s future blendstocks with Chevron’s refining facilities.
“This off-take agreement is the latest development in KiOR’s progress to commercialize renewable transportation fuels,” Cannon said. “When finalized, our agreement with Catchlight Energy will help bring KiOR’s renewable fuels to market so we can help diversify the country’s energy sources.”
The off-take agreement with Catchlight Energy is KiOR’s second for its Columbus facility. In March, the company signed an off-take agreement with Alabama-based Hunt Refining Co. for renewable gasoline, diesel blendstocks and fuel oil.