Join the Club

Butamax signs up first early adopter to produce butanol
By Kris Bevill | March 05, 2012

When Highwater Ethanol LLC signed a letter of intent last December with Butamax Advanced Biofuels LLC to retrofit the 50 MMgy corn ethanol plant for biobutanol production, it also became the founding member of Butamax’s Early Adopters Group. According to Butamax, the EAG is expected to develop into a large group of ethanol producers who have elected to become the “first wave” of producers to use its technology to convert facilities for butanol production. To date, Highwater is the only member of the EAG, but Butamax CEO Paul Beckwith expects that will soon change. “During the course of this year we’re looking to add two to three more members to the group,” he says. “We are talking to a number of producers about this opportunity.”

Butamax has said it is targeting the industry’s leading ethanol producers to join its group.  But considering those producers are already operating at the top of an established industry, why would they consider converting to produce a fuel that doesn’t yet have a market? According to Beckwith, the answer is quite simple: economic opportunity. “What butanol really offers is the opportunity to continue the operation very much as is, but to manufacture a higher value product and gain the benefits associated with that—basically, higher income,” he says.

The biggest drawbacks to butanol production to date have been the arduous regulatory approval process and that legacy ACE butanol technology isn’t competitive with ethanol. Beckwith is confident that Butamax’s technology will be competitive with ethanol on an energy basis within the next year, adding that because butanol has favorable blending properties, refiners and blenders will be willing to pay more for the product relative to ethanol. Butamax plans to begin retrofitting the Highwater plant in 2013, with operations anticipated to begin in 2014. By that time, Beckwith says he expects regulatory approval will have been finalized for the fuel, allowing it to enter into the marketplace with relatively few issues. “One of the strengths of Butamax is that we have a great deal of expertise in the fuels market related to introducing new products,” he says. “We’ve done extensive testing to ensure that when we introduce butanol into the fuels market, we’re able to advise our customers of exactly how to do that and how to formulate the blends in order to ensure a safe introduction to the market.”

Butamax intends to focus its efforts primarily on the fuels market, rather than chemicals. “We will still be able to sell butanol into the chemicals market, but long-term, we see the biggest opportunity for butanol to be the fuels market, and we don’t want to go to market with technology that is only competitive in the chemicals market,” Beckwith says. “That could potentially leave some producers stranded if they don’t have technology that is consistent with being competitive in the fuels market.”

Butamax’s technology and game plan is similar to another butanol developer, Colorado-based Gevo Inc., and the two companies are currently involved in a legal battle over intellectual property associated with the production technology. The lawsuits are ongoing but Beckwith wants to assure ethanol producers that they won’t affect Butamax’s plans. “The litigation is not going to delay our implementation of biobutanol,” he says. “It is very much our intent to commercialize this technology and offer it to the industry.”  —Kris Bevill