dodds & associates © 2014 d a & problems and opportunities in the viola section swea...

DODDS & ASSOCIATES © 2014 DA&

Problems and Opportunities in the Viola Section

SWEA Assembly 2014Wednesday, 11 June 2014

Sarnia, ONDavid Dodds, Dodds & Associates


Axioms (and qualifications)

Corn ethanol is a fabulous success story.But there is more than corn, and more than fuel.

If you are making a molecule, you are a chemist, doing chemistry.

Synthetic biology is just chemistry conducted by other means.“Bio” does not change the molecule.

Redox BalanceIt’s not the carbon, it’s the hydrogen.


Why?

Markets want alternative to petrochemical feedstock• de-linking commodity chemical production from oil prices • Hedge against carbon taxes• Availability of feedstock from multiple locations;

not just price, but supply-chain security

Technical hurdles dropping • Molecular biology, biocatalysis, fermentation technology,

petrochemical processes & engineering

Opportunity to use under-utilized assets and existing infrastructure


Some History1833: diastase (amylase) isolated from barley, shown to convert starch to sugar

1860: Pasteur showed yeast transforms sugar to alcohol and butanol (1861)

1860s: vitalistic and non-vitalistic theories of organized and un-organized "ferments” (Pasteur, Liebig, and Berzelius)

1876: Kühne coined term "enzyme" ("in yeast") for organized ferments

1881: Frémy and beginning of industrial production of lactic acid

1898: last vitalistic paper; F.R. Japp, Nature, 58, 482 (1898)

1905: biological production of acetone discovered by Shardinger

1912: Fernbach patents acetone and butanol production

1916: Immobilized invertase used industrially

1919: Weizmann patents acetone and butanol production (GB4845, US1315585)

1950: 2/3 of all US butanol (~30 MM lbs), 50% of ethanol (~225 MM gal) and 10% of acetone made from molasses & starch


We Have Done This Before

H. Bunn, Industrial and Engineering Chemistry,

44(9), 2128 1952


Product % of To tal US Oil

Cons umption Gaso line 47% Heat ing Oil/Diese l Fue l 20% Jet Fue l (Kerose ne) 8% Propane/Pr opylene 6% NGL, Liqu id Ref inery Ga ses 6% St ill Gas 4% Petroc hemical Feeds tocks 2% Petro leu m Co ke 2% Res idua l/Heavy Fue l Oil 2% Aspha lt and Ro ad Oi 2% Lubricants 1% Misce llaneous Products 0.4% Other L iquids 0.4% Aviat ion Gaso line 0.1% Spec ia l Naphthas 0.04% Waxes 0.04% Kerosene 0.02%

2013 Numbers (US)

75% vs 2%In 2005, ratio was 71% vs 3.5%, with economic impact of $365BB vs $375BB

In 2013 had dropped to $255BB

EIA November 2013

www.eia.gov/dnav/pet/pet_sum_snd_d_nus_mbbl_m_cur.htm


www.eia.gov/dnav/pet/hist

Making, and buying, less….….losing integration and value


Chemical Feedstock: (just corn, just glucose)

US 2013 corn production; 13.8 BB bushels = 350 MM tonnes

• 1 tonne corn = 590 kgs glucose (C6H12O6)

= 275 kgs “CH2 equivalent”

= 2 bbl oil (1 bbl oil = 139 kgs)So current corn production on a simple “CH2” weight basis = 700 MM bbl oilUS oil consumption (2012) = 18.5 MM bbl/day = 6.75 BB bbl/yr2% of oil consumed is for chemical feedstocks = 0.135 BB bbl/yr

On a simple weight basis, ~20% of current US corn crop could theoretically satisfy US chemical feedstock production

Currently, ~42% of current US corn crop goes to EtOH

Estimated that the entire 1.3 BB tons annual renewable biomass would replace about half of the US transportation fuel


Problems

Lack of Champion for Chemicals• US DoE has energy mandate, which includes fuels• USDA has biomass mandate - for eating, building, burning, etc.

Lack of Standards • ASTM D6866 is fine, but not enough• What is “renewable”? “sequestered”? “bio-based”?

Lack of Policy• US federal planning is minimal at best • RFS/RINS, TSCA, R&D tax credits

Lack of Funding• The über problem (a product of taxation, R&D tax credit uncertainty, etc.)• Cost-sharing, incubators, consortia; these all cost money….


The über Problem

• 30 start-ups in the $BB Valuation Club; 1 bioenergy (#17), 1 solar (#29)• Trends in investment are short, fashionable, and risk-adverse• Money from the private sector (corporations) is very hard to attract


Operational Opportunities

Advocacy• A champion for bio-based chemicals; an advocacy group• Need to address lack of policy by direct lobbying/politics

New Paradigm for IP• Just equity for the licence fee• Royalties possible, but not until full commercial production; no minimums

Incubators• Additional overhead for start-up is a non-starter today• Equity, with rent payments beginning and ramping up after 24 months

Grants (US)• SBIR funding is great, but is US-only, and there is not enough• Other FOAs allow foreign entities• A vehicle for cost-sharing and the non-technical parts of the grant package


“Lignin”

Technical Opportunities


Lignin and Hemi-cellulose

Hemi-cellulose• 15% (or more) of tree mass is recoverable• Extracted with hot water and easily depolymerized to 5-carbon sugars• Commercially valuable by-products; acetic acid, methanol, etc.

Lignin• ~20% of all biomass• 1.3 BB tonnes renewable biomass each year in US

= 260 MM tonnes lignin• US consumption of BTX, phenol, PTA is ~30MM tonnes• 10% efficiency across collection & conversion = ~300 MM tonnes• at 10% efficiency, we are just short of total replacement

of the feedstock need for major aromatic chemicals • Phenylpropionic monomers hard to reach


Lignin Biochemistry

24-25 steps; ~70% average carbon efficiency


What is the value of this molecule?(ask your chemists)

R1 , R2 , R3 = H, OH, OCH3

R4 = COOR, CH2OHDecarboxylation to styrenesRing-opening with dioxygenases

Not just woody biomass!Corn fiber contains 2-3% ferulic acid


Hemi-cellulose:(not glucose, not fermentation)

Just four chemical processes applied to C5 monomers

All amenable to continuous petrochemical process design ….but we need some hydrogen

www.prnghrn.com; PCT/US/14/027269


Redox & Hydrogen

We generally want to make molecules more reduced than carbohydrates, which occupy the center of the redox range of carbon

Biological pathways can use H2 gas, but other forms of reducing equivalents

are far more common; NADH, NADPH, FMNH2 etc. and this is generated by

oxidizing carbohydrate feedstock to CO2

This costs carbon! If we make hydrogen, we lose carbon.

3 O2 + C6H12O6 6 H2 + 6 CO2

1 mt H2 costs;• Carbohydrate at $400/mt $6000• Electricity at $60/MW $3200• Methane steam cracker ~$1800


Why is Hydrogen Important?

Ethanol 1 glucose 2 EtOH + 2 CO2

(50%) 9 H2 + 1 glucose 3 EtOH

Butanol 1 glucose 1 BuOH + H2O + 2 CO2

(50%) 6 H2 + 1 glucose 1.5 BuOH + 4.5 H2O

1,4-BDO 11/12 glucose 1 BDO + 0.5 H2O + 1.5 CO2

(100%) 10 H2 + 2 CO2 + 1 glucose 2 BDO + 6 H2O

Difficult to handle H2 gas in a fermentor; hazardous and gas/liquid transfer

Electrochemical methods to add reducing equivalents avoids this, and allows “hydrogen distribution” via existing electrical grid

WO2014/039767 and earlier work at MSU


Biocatalysis: An Overlooked Technology

The use of biological catalysts - enzymes - as isolated catalysts under non-physiological conditions

The last 25 years have seen there increasing use in pharma especiallyRapid advances in relevant biological platform technologies

Almost completely unused in chemical industry, yet can be used in standard industrial catalytic process configurations

These catalysts are just high molecular weight polyamides that do not contain precious metals…

…and are getting much easier to make!


Publications Cost of SequencingN

um

ber

100k

10k

1990 2012

Published Protein Structures

Extremely Rapid Technology Growth

Many public databases with complete pathways

www.genome.jp/keggwww.brenda-enzymes.infowww.ncbi.nlm.nih.gov/genomewww.yeastgenome.org


0

2

4

6

8

10

12

14

16

Pharma Chemical Reactions: Biocatalysis Contribution

• Pharma has been busy building the technology base for ~25 years• Activities available in 2 weeks to 2 months; industrially relevant timing


Biocatalysis Applications

Immobilized Cells for Continuous Processes• Catalyst containment and stability; avoids isolation & purification issues• Multiple reactions possible (metabolic pathways intact, including redox)

Cell-free Process Configurations Protein engineering is available, practical and timely Use packed-bed reactors; same as petrochemical industry Easily scaled, stability needs to be in 6-month range Spatial separation of multiple enzyme steps

Redox Chemistry Remains important and still difficult for chemists Electrochemical regeneration of cofactors


Our Opportunities

• Advocacy: a champion for bio-based chemicals policyDo what the small company cannot; actions where organizational size and membership numbers really do matter

• IP: New Paradigm for moving from academia to start-ups

• Reconsideration of Incubators and their operation

• A vehicle for handling the non-technical aspects of grantsThis has enormous value but is boring - and difficult.

• A practical and unified message from our communityWe are distracted by biofuels. We need fixed policy.We need funds that actually reach the bench rather than supporting other organizational infrastructures.


David R. Dodds, Ph.D.Dodds & Associates LLCMOBILE 315 884 3703 / TWITTER drdodds4 [email protected]/in/techdiligence

dodds & associates © 2014 d a & problems and opportunities in the viola section swea...

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