Competing with Petrochemicals for Products K Lynne Johnson ABIC 2010 Conference: Bridging Biology and Business
Complexity versus Simplicity Petroleum Feedstock Complex Downstream Processing Conventional Petrochemical Infrastructure Petrochemicals require tremendous infrastructure and processing steps Renewable Feedstock Elegant Conversion Process Elevance Metathesis Catalyst Biochemicals can offer simple technologies to unlock nature s complexity and performance. 2
A Path Forward Combining Nature s Resources with Human Ingenuity to reinvent the future. Embrace what nature has to offer Integrate the knowledge generated in the past 100 years new process technology Imagine molecules never seen or available before Creatively employ these technologies to solve important problems Think and act holistically cradle to cradle product designs. Improve quality of life for all life forms, in an environmentally responsible manner, by re-designing natures molecules. 3
Beginnings. The Challenges Cost Competitiveness Delivering Competitive and Novel Performance Efficient Manufacturing Feedstocks and Supply Chain Access to Markets & Customers Regulatory Requirements Source: Rose Walker LLC 4
An Innovative Specialty Chemicals Company that Happens to be Renewable 5
Company Overview WHAT WE DO Elevance Renewable Sciences Inc. is the leader in the chemical conversion of renewable feedstock into a wide range of both drop in and novel specialty chemicals TECHNOLOGY Elevance biorefinery platform produces high value chemicals from renewable oils using proprietary, Nobel prize winning metathesis catalyst technology developed by Dr. Robert Grubbs COMMERCIAL PRODUCTION Already commercialized, marketed and generated gross profits from its first suite of commercial products Current Run Rate Production: 13,000 Kmt 2013 Projected Production: 840,000 Kmt KEY STATS Employees: 60 Founded: 2007 Headquarters: Bolingbrook, IL 6
Commercial Disruptive Technology Low Costs Multi-source, low cost feedstocks Direct route to specialty chemicals Low energy intensity operating conditions Scale economies Low Capital Direct conversion route limits processing steps Co-locate with synergistic manufacturing facilities Retrofit of existing biodiesel assets High Value Platform technology allows conversion into chemical building blocks Coveted product properties in several applications The only commercial technology that creates both direct replacement and new higher performance replacements with compelling economic returns 7
Elevance Biorefinery Scale drives economics; chemicals derivatives enhance sustainability & flexibility Repurposes or integrates into existing industry infrastructure driving low capital costs Olefins Olefins Co-Reactants Bio-Oil Metathesis Distillation Derivatization/ Separations Specialty Chemicals Process step Esters Trans-Esterification Distillation Inputs Products Alcohol Hydrolysis / Hydrogenation Oleochemicals 8
Wilmar Elevance Joint Venture Integrating into Existing Indonesian Infrastructure Feedstock Capital Off-Take Technology Capital Off-Take Utilities, storage and other infrastructure Jetty Joint venture for world s largest biochemical refinery (initial size of 180 Kmt in 2011, expanding to 360 Kmt) Processing equipment 9
Uniquely Positioned to Access Value From All Oil Feedstocks Renewable oil feedstocks provide significant advantages Strategic partnerships with large suppliers enable security and diversity of supply Feedstock flexibility between two oils has ability to deliver 5-12% in further cost optimization Canola Mustard Soy Algae Rapeseed Olive Algae Palm Rapeseed Jatropha Mustard Soy Palm 10
Large and Existing End Markets Growth with Drivers for New Solutions Consumer Ingredients & Intermediates Detergents & Cleaners Performance Waxes & Candles Personal Care Products Antimicrobials Personal Care Preservatives Ag Insecticides & Fungicides Consumer & Industrial Biocides Lubricants, Additives & Fuels Lubricant Base Oils Lubricant & Fuels Additives Advanced Bio-Fuels $105 Billion $13 Billion $50 Billion 11
Market Entry Strategy 100% 90% Capacity 80% 70% 60% 50% 40% 30% 20% 10% 0% Petrochemical Substitutes Time Premium Alternatives Specialty Chemicals Petrochemical Substitutes Premium Alternatives Specialty Chemicals Provides Profitable Baseload Enhanced Profitability Maximize Profitability Requires Qualification Performance Testing Development Replacing Chemical Equivalents Similar Products Lower performing or higher cost alternatives Key Metric Meeting Spec Tighter Specs or Process Economics Demonstrating performance & economics Development Cycle 3-6 months 6-18 months 12 36 months (canbe up to 60) 12
Anticipating Regulatory Requirements US TSCA Timeline 30 Days 45 Days 90 Days Assessment Bona fide letter of intent to manufacture IES Nomenclature Pre-manufacture Notice Process description Chemical description NMR spectra Product confidentially registered? Verify CAS names and numbers Europe REACH Timelines: Phase-in: 9 DA Confirm EINECS Status Not Phased In >1 ton / year Submit Late Pre-registration May 2013, >1000 t / yr Submit Registration Dossier Submit Inquiry Dossier Develop testing plan Final Registration Dossier 13 2011 Target
Strategic Partnerships Accelerate Entry into Large Existing Markets Large End Markets Penetration Accelerated via Partnerships Global partners have assets and capabilities that complement & rapidly extend Elevance s capabilities Increased access to available customers Allows Elevance to maximize value capture Consumer Ingredients & Intermediates Antimicrobials Lubricants, Additives & Fuels Manufacture Specialty Consumer Ingredients and Intermediates Leading Developer and Supplier to the Personal Care Industry Specialty Personal Care Retailer 14
Collaboration and Partnership. Building networks and partnerships to: Access innovative technology Access Centers of Expertise Accelerate access to large, existing end markets Access to manufacturing and supply chain 15
Highlights Proprietary, Disruptive Technology Platform Rapid Commercialization, Generating Gross Profits Today Attractive Low Capital And High Margin Business Drives Compelling Unit Level Economics Flexible and High Return Business Model Accelerates Global Growth Renewable Feedstock Flexibility Large And Existing End Markets Accessible Through Strategic Partnerships Delivering Exceptional Economic Returns and Enabling a Multibillion Dollar Specialty Chemical Business 16
Thank you. 17 2008 Copyright, Elevance