20. Aug 2019
The company is progressing its technologies towards commercialization. “Overall, Avantium remains confident to deliver on the strategic objectives.”
Earlier today, renewable chemistry company Avantium N.V. presented its first half year results. The cash position was €53.1 million at 30 June 2019 versus €83.3 million at the end of 2018, mainly because of the repurchase of the Renewable Polymers business – formerly Synvina - which involved an investment of € 17.4 million and a €3.1 million investment in the new Mekong demonstration plant. Total adjusted EBITDA decreased in line with plan to € -8.8 million in the first half of 2019 (€ - 1.3 million in the corresponding period of 2018), largely in connection with these investments.
Consolidated first half 2019 revenues decreased by €1.2 million to €5.2 million (HY 2018: €6.4 million) mainly due to the timing of Catalysis order intake – higher revenues in the first half of 2018 and new contracts negotiated towards the end of the first half of 2019 caused a shift in revenues, which was partly mitigated by Avantium Renewable Chemistries and Avantium Renewable Polymers revenue in HY 2019
Operating expenses increased to €17.4 million (HY 2018: €9.9 million) due to the acquisition of 100% ownership of Synvina and its incorporation into Avantium’s cost base as Avantium Renewable Polymers.
Tom van Aken, Chief Executive Officer of Avantium, noted that the company’s focus is on those technologies with the highest value potential.
“Our plant-to-plastics YXY technology to produce FDCA and PEF is progressing towards commercialization with leading engineering services company Worley conducting detailed pre- engineering studies for a 5 kilotons flagship plant. Our focus remains on delivering the milestones on our journey towards opening this flagship plant in 2023. Avantium aims to secure funding and make the investment decision for construction of this flagship by the end of 2020.
The Renewable Chemistries business unit is focused on progressing our partnership opportunities along with opening the Mekong demonstration plant in November 2019 and successfully operating the Dawn pilot biorefinery. I am pleased that we have been awarded €3 million in EU grants for our Mekong and Dawn Technologies. This support is a strong signal for continuing our work to create and commercialize sustainable chemistry technology solutions.”
In January 2019, Avantium regained full ownership of its YXY Technology through the purchase of BASF’s shares in the Synvina joint venture. Avantium paid BASF €17.4 million, with the transfer taking place on 25 January 2019. Synvina became a business unit of Avantium, alongside the Catalysis and Renewable Chemistries business units. Avantium appointed Marcel Lubben Managing Director of the new business unit with a mandate to lead the commercialization of the YXY technology. In June 2019, the Synvina business unit was renamed Avantium Renewable Polymers.
Plans for the future are the construction of a cash-flow positive flagship plant with a planned annual capacity of 5 kilotons of FDCA (built, owned and operated by Avantium) and 5 kilotons of PEF (produced in partnerships).
Engineering company Worley (formerly known as Jacobs Engineering) has started detailed pre- engineering studies for the intended FDCA flagship plant slated for a 2023 start-up. Site selection in north-western continental Europe is aimed to be completed in the second half of 2019.
The plant will produce products for high-value markets and performance applications. This includes specialty films that can be used in electronics and displays (LCD/OLED), PEF-enhanced bottles for premium beverages and cosmetics, and plant-based recycle-ready or recyclable flexible packaging.
Avantium’s Renewable Chemistries business unit continues its focus on developing innovative chemistry technologies that utilize renewable sources of carbon instead of fossil carbon. The technologies enable the production of chemical building blocks and plastic materials. Significant progress has been made in the three lead programs of Avantium Renewable Chemistries in an effort to accelerate the transition to a fossil-free world. In the first half year of 2019, the revenues from collaboration agreements more than doubled to €0.5 million (HY 2018: €0.2 million).
The company’s proprietary Mekong Technology converts glucose into plant-based mono-ethylene glycol (MEG). This is a major drop-in component used in the production of many materials, including polyesters. Avantium will officially open a demonstration plant for its Mekong technology in Delfzijl, the Netherlands in November 2019. This demonstration plant is a pre-commercial facility with a nameplate capacity of 10 tons of plant-based MEG per year. In August, the demonstration plant will be delivered fully assembled and ready for commissioning to Avantium’s site at the Chemiepark in Delfzijl from engineering partner Zeton in Enschede, the Netherlands.
The opening of the demonstration plant is a major step forward in commercializing the Mekong technology in that Avantium will scale from lab to a size that mimics the conditions at a commercial- scale plant. Based on the results of the demonstration plant, Avantium will be able to validate the technical performance and refine the economic opportunity. If testing on demonstration plant scale is successful, Avantium intends to make an investment decision regarding a possible commercial-scale flagship plant in 2022.
In the first half of 2019, Avantium progressed its partnership opportunities to bring Mekong to full-scale commercialization by signing several collaboration agreements around the globe.
In March 2019, Avantium received a €2.0 million grant from the European Regional Development Fund, facilitated by Partnership Northern Netherlands (Samenwerkingsverband Noord-Nederland). This grant aims to accelerate innovation in the quest for a low-carbon economy.
In June 2019, Avantium announced that it has been awarded €1.3 million for both its Dawn and Mekong Technologies from the Bio Based Industries Joint Undertaking (BBI JU) under the European Union’s Horizon 2020 Research and Innovation Program. This commits Avantium to participate in the VEHICLE consortium whose members aim to widen the business and market opportunities of existing and future biorefineries by demonstrating the applicability of their sugar streams in several downstream options. The role of Avantium in VEHICLE is to provide sugar streams from non-food feedstock over a 4-year program. This sugar is produced in the Dawn pilot biorefinery in Delfzijl, the Netherlands. Avantium will also convert industrial sugars from the consortium partners (including the sugars from Avantium’s Dawn pilot biorefinery) into plant-based mono-ethylene glycol (MEG) through its Mekong Technology.
Dawn Technology - The Future of Biorefining
Avantium’s proprietary Dawn Technology produces industrial sugars and lignin from forestry residues in its pilot biorefinery in Delfzijl. These sugars are an excellent raw material for chemistry and fermentation processes to produce a broad range of chemicals and materials. The lignin is energy dense and ideal for energy generation as well as other higher value applications like asphalt. With proven technical and economic feasibility, the pilot biorefinery is the prelude to a commercial-scale flagship plant. The investment decision regarding a possible Dawn flagship plant is expected by 2021.
Dawn is a feedstock flexible technology which means that future biorefineries can use its own locally sourced non-food biomass like forestry and agricultural residues. Avantium aims to globally deploy the technology via licenses and is steadily progressing its partnership opportunities around the world.
Avantium’s Volta program is a platform technology that uses electrochemistry to convert CO2 to higher value products and chemical building blocks. The Volta team is currently scaling up from lab scale towards pre-pilot installations. The first units aim to capture CO2 from the atmosphere and are part of consortia where Avantium will operate the units at the Prodock building in the Port of Amsterdam.
Avantium actively participates in industry associations and currently cooperates with over 35 partners in European grant consortia, providing the company with over €5 million in grants.
Avantium Catalysis - Tomorrow’s Catalysis Today
Avantium Catalysis provides advanced catalysis testing systems and contract R&D. The Contract R&D business offers the execution of in-house customized contract research projects. The Systems business comprises Avantium’s unique and advanced Flowrence high-throughput catalyst testing systems, which are tailored to accelerate catalyst screening and to study catalyst deactivation.
Avantium Catalysis has developed a strong, international customer base, including several industry leaders. In May 2019, Shell renewed its long-running partnership with Avantium Catalysis for four additional years for the execution of catalyst testing programs with Avantium’s Flowrence technology platform. In June 2019, Avantium decided to significantly expand its capacity to test commercial catalysts for hydrotreating and hydrocracking applications, to serve the strong demand for its independent refinery catalyst testing services.