Syntec Biofuel acquires catalyst technology for biomass-to-liquids production

Canada's Syntec Biofuel announces that it has signed a definitive purchase agreement with Montilla Capital Inc. to acquire catalyst technology being developed for converting syngas obtained from biomass and biogas into synthetic biofuels, specifically alcohols (ethanol, butanol, methanol and propanol). The agreement includes all the research and development assets used at their laboratory.

Development and research of the catalysts commenced in 2001 in laboratories at the University of British Columbia, and since 2005 have been further developed in house. Syntec is now in phase two development, refining its catalysts using non-precious metals for long term stability tests under industrial conditions and expects to be ready to file a second patent application within the next 6 months. Syntec has undertaken to raise up US$3 million dollars to ramp up technical staff, purchase equipment and provide working capital for development, testing and quantifying the life of the catalysts prior to commercialization.

Against the backdrop of the current ethanol boom, analysts concur that biofuels produced from food crops like corn or rapeseed are not a long-term solution to oil dependence. Discussions increasingly focus on second generation production technologies that can utilize renewable and waste feed stocks such as wood waste, switch grass, agricultural waste and residues from current ethanol producers (corn stover and sugar bagasse).

The industry recognizes that production of corn to ethanol has a negative impact on consumer food prices and farm land while cellulosic conversion of waste products are going to spawn the next generation of growth in the ethanol industry. [...] With oil prices now exceeding $70 a barrel the use of ethanol as a fuel additive is the only option available to reduce our reliance on imported oil. - Michael Jackson, President of Syntec Biofuel

Second generation bioconversion processes can be grouped into two broad pathways: biochemical and thermochemical conversion. Within the latter category, so-called biomass-to-liquids (BtL) processes are one of the options. They consist of gasifying biomass into a syngas, which is then liquefied via catalytic synthesis into a range of ultra-clean 'synthethic biofuels'.

Syntec Biofuel is developing this process, but with a specific focus on non-precious metal catalysts to synthesize specific alcohols (schematic, click to enlarge). High pressure catalytic synthesis requires substantial energy to operate and the risk associated with the high pressure is significant. Syntec Biofuels instead will utilize low pressure catalytic synthesis, which has been used for methanol production for many decades:
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Unlike the current fermentation processes used for first generation biofuels, Syntec's catalysts will produce biofuels from virtually unlimited biomass sources such as municipal waste, wood waste such as saw dust and bark from lumber mills, corn stover and sugar bagasse from existing ethanol producers, waste gas, such as biogas from landfills, sewage, manure, and producer gas (thermal gasification of biomass or other carbonaceous material such as municipal solid waste).

Syntec's revenue model will be based on Joint Venture projects, licensing fee for use of the Syntec technology and a royalty of approximately 7.5 cents per gallon of alcohol produced plus a commission on the sale of catalysts to licensees.

The Company has agreed to issue 11,000,000 shares in exchange for the Syntec Assets and will assume liabilities not exceeding $350,000. The purchase of the Assets has been approved by the board of Directors of Syntec Biofuel Inc. Syntec’s current business is in the animal food and supplement sector, which the Company proposes to phase out in due course.

The first phase of the development of the catalysts was funded through private equity as well as the Canadian government agencies, National Research Council of Canada and Natural Resources Canada.