Avantium, Origin Materials align technology platforms, sign licence agreement

Netherlands-based renewable chemistry company Avantium and Origin Materials, a sustainable materials company based in the USA, have entered into a strategic partnership designed to accelerate the mass production of FDCA and PEF for use in advanced chemicals and plastics.
To that end, the two companies are aligning their technologies in order to produce FDCA from sustainable wood residues on an industrial scale.

Using woody biomass as feedstock, Origin has developed a one-step catalytic process to convert C-6 cellulose into four different building-blocks, amongst which the furan CMF, or chloromethyl furfural, an FDCA precursor. No sugars or fermentation are required. The technology uses sustainably harvested wood, but agricultural waste, wood waste, and even old cardboard also work. All are non-food, second-generation feedstocks.

Avantium’s proprietary YXY technology catalyti­cally converts plant-based sugar (fructose) into FDCA, which is, amongst others, a key building block for PEF, a 100% plant-based, recyclable and degradable biopolyester with superior functionality and a significantly reduced carbon footprint compared to conventional plastics. PEF can be used in a wide range of applications such as bottles, packaging, films, fibres and textiles, which represent major end-markets.

“By combining Origin’s revolutionary platform, which can produce key FDCA precursors like CMF from sustainable wood residues, with Avantium’s YXY process technology, we aim to transform the polymers and materials industry,” explained John Bissell, Origin co-founder and co-CEO. This partnership accelerates our efforts to bring economical non-food based FDCA and PEF to market.”

This will also further diversify the feedstock options from first generation fructose for producing FDCA to include second-generation (2G) feedstock, as Avantium’s CEO, Tom van Aken, pointed out.
“The technologies of both companies are highly complementary and will also allow the use of non-edible, renewable feedstocks for the production of FDCA and PEF, he said. Avantium’s strategy, he added, is to enable the use of both first- and second generation feedstock, meeting the expectations of brand owners and consumers worldwide.
“Our YXY Technology is feedstock agnostic. That means that we keep focusing on both 1G and 2G feedstock, and the latter can come from the partnership with Origin - but also others, including from our own Dawn Technology.”

Avantium is currently constructing the world's first commercial-scale FDCA Flagship Plant in Delfzijl, the Netherlands and has signed offtake agreements for the supply of FDCA and PEF to major brand names and industry leaders for a range of applications. Origin Materials recently reported that it has mechanically completed its first commercial manufacturing plant Origin 1 in Canada. For Origin 1 and future plants, Origin, too, has signed numerous capacity reservations and offtake agreements with well-known brand owners.

Licence agreement
The present partnership between Avantium and Origin is founded on a series of agreements, including a non-exclusive industrial technology licence agreement. This agreement provides Origin Materials with access to relevant parts of Avantium’s process technology to enable the conversion of Origin-produced CMF derivatives into FDCA at a 100-kilo-tonne per annum scale facility. Specifically, Avantium has granted Origin a non-exclusive licence to use certain parts of Avantium’s proprietary YXY process (including certain patent rights) for the purpose of first designing, constructing and operating the licenced facility and then producing, using, selling and converting FDCA manufactured at that facility. Following the commercial operations date of the licenced facility, Avantium will be eligible to receive royalties for each metric ton of FDCA produced at the licenced plant.
“It has always been our strategy to commercialise the FDCA/PEF YXY technology by selling technology licences to industrial partners who are expected to build production facilities on an industrial scale, based on the knowledge and experience derived from our Flagship Plant. The sale of a first licence for the YXY Technology provides a further validation of our process technology to the market,” said Van Aken.

Offtake agreement
Origin Materials and Avantium have also entered into a conditional offtake agreement (COA):  Avantium will sell FDCA and PEF to Origin Materials from its FDCA pilot plant in Geleen, the Netherlands, in 2023 and from its FDCA Flagship Plant in Delfzijl as from the commercial operations date in 2024. Origin will purchase a gradually increasing minimum annual volume of FDCA on a take-or-pay basis; Avantium will continue to pursue additional offtake and industrial licence agreements with other industrial partners to further expand and diversify the market for FDCA and PEF applications.
Asked about the pricing of the materials, Van Aken said that ‘Origin Materials will acquire significant volumes of FDCA and PEF from the Avantium FDCA Flagship Plant within the communicated range, i.e., ‘at a price comparable to where Avantium is selling the material €8 – €10 / kg during a five-year term’.

"We are excited to enter into this strategic partnership with Origin Materials, a like-minded partner committed to revolutionising the chemical and plastics industry," emphasised van Aken.
“Together we aim to bring the value of FDCA and one of its main applications, PEF, to the industry at large and to drive decarbonisation throughout the supply chain,” added Bissell.