Avantium partners with Origin Materials to compete with “highly conservative” petrochemical industry
23 Feb 2023 --- Avantium is partnering with US-based sustainable materials company Origin Materials to accelerate the mass production of furandicarboxylic acid (FDCA) and (polyethylene furanoate) PEF for use in advanced chemicals and plastics.
Avantium says this is an important moment in its evolution. With the first license agreement, the company will receive an upfront fee of €5 million (US$5.3 million) from Origin Materials and a milestone fee of €7.5 million (US$7.9 million).
FDCA is the key building block for the biopolymer PEF – a 100% plant-based, fully recyclable plastic material with superior functionality and a significantly reduced carbon footprint compared to conventional plastics.
“Partnering and licensing are at the heart of our strategy. We are a technology company whose strategy is to develop and commercialize process technologies toward renewable materials and not an operator of chemical facilities to produce chemical materials,” an Avantium spokesperson tells PackagingInsights.
“Licensing is the most capital-efficient way to commercialize our technologies and the fastest way to deploy our sustainable solutions to market. The sale of this first license agreement highlights the broad potential of our YXY Technology.” YXY is a proprietary method that converts plant-based sugars into FDCA.
Avantium says the partnership is a significant milestone on the road away from petrochemicals.Strategic evolution, “major milestone”
The spokesperson says the partnership is an “important moment” in the strategic evolution of Avantium.
“The business model of our FDCA Flagship Plant that we are currently constructing in Delfzij (Netherlands) is based on sales of FDCA and PEF to offtake partners to demonstrate the commercial viability of FDCA and PEF and that of our YXY process technology to produce FDCA,” they say.
“These steps support the execution of our strategy, which is to sell technology licenses 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.”
“This partnership combines the efforts of two bio-based champions in their competition with the highly conservative petrochemical industry.”
The collaboration will add to the feedstock options for Avantium, as it also allows the use of second-generation, renewable feedstocks for the production of FDCA and PEF in addition to its high fructose syrup route.
Waking up the “sleeping giant”
Avantium says the partnership is also a defining moment in the development of the markets for FDCA and PEF.
“FDCA has always been referred to as a ‘sleeping giant’ because of its huge market potential, sleeping because no one knew how to make it economically. This announcement is proof of how we are making strong progress, waking up this sleeping giant.”
“This is an acceleration of our licensing strategy since this license agreement comes earlier than our assumptions. It is also fully in line with our technology development roadmap.”
“We continue to pursue our dialogue with additional industrial license agreements with other industrial partners to expand further and diversify the market for FDCA and PEF applications,” they conclude.
This year, Avantium and Henkel signed an offtake agreement for five years, under which Avantium will supply Henkel with FDCA.
By Louis Gore-Langton
