It is extraordinary for a bio-based totally startup inside the feel that whilst we aim to license our technology, the license itself can be free.”
Creative destruction is not unknown to the oil enterprise. Whale oil, which ruled the world from roughly the 17th century, turned progressively offset by using fossil oil after discovering the latter in the nineteenth-century United States. The US later misplaced its dominance within the market to the Middle East inside the 20th century. The 21st century, too, has already visible its honest proportion of disruption innovation, most appreciably inside the US with shale oil and tar sands in Canada. It is truthful to say but that none of the aforementioned crude oil sources may be considered sustainable. Our cause at Vertigo, writes CEO Michael Boot is consequently to hasten the next oil revolution and to assist make sure it will likely be a sustainable one this time around.
Opportunity.
We presently pump approximately five billion heaps of fossil oil out of the floor each year. A sustainable aid that might help offset this massive determine is lignin – the constituent of the cell partitions of almost all dry land plant cell walls and the second one maximum ample natural polymer within the international surpassed simplest by way of cellulose. Most terrestrial flowers comprise everywhere between 5 and 25% of lignin. In total, Mother Nature produces upwards of 20 billion tons in keeping with yr of this compound by way of photosynthesis.
Of this amount, the handiest one hundred million heaps are remoted from biomass through the pulp and paper enterprise, and, greater lately, additionally by using the nascent cellulosic-to-X sector. Most, over ninety-nine %, of this, is burnt onsite for electricity. Accordingly, simplest 1,000,000 tons or so of lignin, more often than not lignosulphonates, reveals its way to the market, to be used as feedstock for chemicals (vanillin) and materials (e.G., binders, resins), or for strength someplace else (e.G., pellets for co-firing in coal plants).
Designed for pace – ambition and commercial enterprise version.
First, a few phrases at the provocative name of this piece. Commodities are most profitably produced like fuels and chemical substances whilst completed in economies of scale and proximity of downstream clients. The equal is probable to also keep true for their bio-based totally equivalents. Accordingly, producing commodities at once from biomass at competitive (i.E., degree playing field with fossil) costs might be challenging. The intent is that biomass, absent any economic or subsidy incentives, tends no longer to cluster inside the required order of significance of tens of millions of tons, not to mention this being the case near petrochemical clusters.
To resolve all this, Vertigo believes the bio-based financial system will require a platform product, being a crude oil, which may be with ease transported over long distances, at low cost, and by present belongings (e.G., pipelines, tankers). As is the case for any nascent increase market, the first business enterprise to establish enough scale with their platform product, say 1 million tons in keeping with annum or so in this case, is the most probably add the enterprise a good way to set the usual for downstream “app” builders. Ensuring network consequences will, in addition, upload to market electricity. Speed is important; it’s a race…
Our precise business model is derived from this ambition and is strange for a bio-based startup within the sense that even as we purpose to license our era, the license itself can be loose. The only caveat is that Vertigo is permitted one-of-a-kind off-take settlement of the CLO at a guaranteed annual go back of investment for the licensee (commonly around 15%). There are motives for this approach. First, this way, we get fewer ability licensee questions about the marketplace ability/price of CLO; their core business is ethanol or pulp in the end. Second, the oil commercial enterprise requires an economy of scale that isn’t doable CLO produced by any licensee. This can simplest be performed by aggregating CLO from a couple of licensees, a good way to beautify our bargaining electricity with our foreseen downstream petrochemical clients.
Inspired using huge-oil – technology.
Vertigo’s era is a spinoff of the aforementioned ambition and commercial enterprise model. Our arguably low-tech method to lignin mirrors that of the only one adopted with the aid of oil majors for lignin’s closest petrochemical cousin, bitumen; itself a heavy aromatic compound this is strong at room temperature and of low fee wherein it is discovered. Bitumen valorization involves predominant steps. First, it’s far dissolved in organic solvents (e.G., naphthenes, paraffin) to make it pumpable. The ensuing blend, from a couple of websites, is then transported thru lengthy pipe traces to an oil refinery, where, within the 2d step, it is co-processed with fossil oil. Needless to say, the latter step takes area at an economy of scale and inside the proximity of a chemical cluster, whilst the former operation takes area close to the “mining” web page of the raw cloth.
Issue #eleven of the Bio-Based World Quarterly now available As lignin is more polar than bitumen, we paintings with polar solvents as an alternative, however otherwise adhere to the same similar hub (< 1 Moon) and speak (50-100 ton) method for CLO. A downside of bitumen recuperation is that solvent wishes to be continuously recovered and sent returned to the field. We keep away from this drawback using matching the solvent used to the preferred downstream product-market mixture. For instance, whilst targeting two recognised direct packages for lignin, phenol resins or poly-urethane, we use a diol or phenol, respectively, as the solvent.
The resulting solvent-lignin oil can then be used as a partially bio-based feedstock for the aforementioned applications. This way, inexperienced-minded manufacturers of those substances do now not want to put money into biomass garage centres, nor in enhancing their hardware to permit for solids co-processing. Alternatively, devoted downstream refineries, CLO may be processed at a larger scale, thereby making an allowance for the use of greater complicated (catalytic) structures. For this, we’re developing pathways from CLO to, amongst other commodity chemicals, BTEX, cresol, and phenol.
Part of a bigger ecosystem – partners.
Vertigo, Spanish for “Green Gold, “is a younger Dutch spin-off from The Chemelot Institute for Science & Technology (InSciTe). InSciTe, in turn, is the personal public partnership among Royal DSM, the Brightlands Chemelot Campus, Eindhoven University of Technology, and Maastricht University. Vertigo has secured license agreements with InSciTe for two lignin-associated technologies. One produces Crude Lignin Oil (CLO) from ex-planta lignin (e.G., effluent from paper pulp-, cellulosic ethanol vegetation). The 2d does the identical from in-planta lignin (e.G., timber). The overall R&D and funding price range is approximately 10M€, which includes the aforementioned pilot plant.
Building momentum – current traits.
On March seventh, 2018, our contender for the “Google Android of the bio-based totally financial system,” crude lignin oil (CLO), become nominated for the Bio-Based Chemical Innovation of the Year 2018 by using Bio-Based World News. Now, more or less 1/2 a year on, we would really like to percentage with Bio-Based World News and her readers what can nice be defined as pretty the roller-coaster journey. In June 2018, we introduced the closing of our first seed round with a 0.5M€ funding made via the Vertigo founders, Chemelot Ventures and Limburg Development and Investment Company (LIOF). A few months later, in August, we shared the first pictures of preparations for a 50 ton CLO in step with annum pilot plant at the Brightlands Chemelot Campus within the South of Netherlands. Just weeks later, in September, we shared our plans for a multi-cause demo plant in Cordoba, Spain, spearheaded with the aid of UK-based totally Saint Energy.
Open innovation = velocity
As Google has proved with Android, we are firm believers in open innovation as this is the pleasant way to garner momentum for any new platform. Partnerships, upstream or downstream, are welcomed wholeheartedly. CLO samples, together with your lignin-solvent combination of desire, maybe supplied freed from price and without cumbersome NDA’s or MTA’s. Joint clinical courses with enterprise or academia are welcomed properly. Contact me nowadays so we will hasten the next oil revolution together!
