Gevo Inc (NASDAQ:GEVO) said it has signed a memorandum of understanding (MoU) with Sweetwater Energy Inc, regarding the use of sustainably sourced agricultural residues and woody biomass as a feedstock for producing cellulosic alcohols and energy-dense renewable liquid hydrocarbons.
As outlined in the MoU, Sweetwater plans to build, own and operate a facility adjacent to Gevo’s existing plant in Luverne, Minnesota to produce high-value, plant-based products from cellulose and lignin, while supplying Gevo with up to 30,000 tons of biomass-derived cellulosic sugars annually, with opportunities for expansion.
The new Sweetwater facility will channel Sunburst technology for deconstructing lignocellulosic biomass. Sweetwater’s anticipated plant-based product portfolio, derived from cellulose and lignin, is aimed at applications in packaging and resins to increase performance, while displacing petroleum-based products.
READ: Gevo ends 3Q with $522.4M in cash and equivalents as demand for its products increase
Gevo said it plans to use the offtake of the low-cost, cellulosic sugars co-produced by Sweetwater for the production of “cellulosic alcohols and renewable hydrocarbons.”
“We’re very excited to work with Gevo,” Sweetwater Energy CEO Arunas Chesonis said in a statement. “This partnership fits perfectly with our goal for the company — replacing petroleum products with renewable solutions at a price point so low that making the right decision for the planet is also the right decision for our customers.”
Englewood, Colorado-based Gevo was the first company to demonstrate conversion of cellulosic sugars to make sustainable aviation fuel meeting the ASTM D7566 specification allowing it to be used for commercial flights. Gevo expects it can be commercialized effectively when cost-effective sources of these sugars meet sustainability goals.
In addition, Gevo said cellulosic D3 RINs are “high-value and create an opportunity” for the company to leverage its Luverne plant with better returns.
The potential partnership with Sweetwater to supply cellulosic sugars provides an exciting model for Gevo as this offtake model could be replicated globally in multiple locations. It could expand the reach of Gevo’s “systems approach to sustainability,” while allowing the company to stay focused on its technology for production of alcohols and hydrocarbon fuels. Developing new partnerships for the conversion of cellulosic biomass is expected to continue to be a part of Gevo’s strategic plan, noted the company.
Since Sweetwater’s technology has been proven in operation on a commercial scale at the Sweetwoods Project in Imavere, Estonia, Sweetwater plans to increase the types of feedstock used in the Luverne plant to include wood products and agricultural residues.
“Construction of the Sweetwater facility adjacent to the Luverne facility is anticipated to begin in Q3 2022,” said the company.
“Combining forces with Sweetwater is a great way to leverage the best technology and resources from both parties to expand our addressable feedstocks to produce cellulosic alcohols and energy dense hydrocarbon fuels and plant-based products,” said Dr Paul Bloom, Chief Carbon and Innovation Officer at Gevo.
Dr Bloom said that they anticipate delivering products to the market “faster while decreasing risk” throughout the value chain.
“This is an important step to expand the portfolio of carbohydrates we intend to process to include cellulosic sugars that represent a huge amount of feedstock globally,” added Dr Bloom.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
Follow her on Twitter: @UttaraProactive