Celanese Takes An Ethanol Plunge | October 24, 2011 Issue - Vol. 89 Issue 43 | Chemical & Engineering News
Volume 89 Issue 43 | pp. 20-21
Issue Date: October 24, 2011

Celanese Takes An Ethanol Plunge

The chemical producer seeks to make ethanol a major business but is secretive about details of its process
Department: Business
News Channels: Analytical SCENE
Keywords: ethanol, gasification, coal, China
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LOOKING UP
Celanese’s Clear Lake, Texas, facility will be the site of a new ethanol plant.
Credit: Celanese
 Celanese’s Clear Lake Texas complex
 
LOOKING UP
Celanese’s Clear Lake, Texas, facility will be the site of a new ethanol plant.
Credit: Celanese

Celanese made a surprising revelation last November. The chemical maker announced it had developed a technology that would allow it to enter the ethanol industry. What’s more, the company wasn’t stepping gingerly into the new business, as chemical makers often do, through pilot plants and gradual scale-up of manufacturing facilities. Celanese pledged to spend hundreds of millions of dollars to construct ethanol plants in the U.S. and China.

The new technology generated so much interest from investors that, in December, Celanese officials held a conference call to discuss it with analysts. The executives did not contain their enthusiasm or seek to dampen the excitement. The economics of the process, they said, compares favorably with fermentation and even with gas-to-liquids routes to alcohols. If, hypothetically, Celanese were to already have a plant up and running in China, they claimed, ethanol would be the company’s most profitable business. Celanese’s entry into the ethanol business, Chief Executive Officer David N. Weidman proclaimed, was “like Amazon entering the bookselling business.”

During the call, however, the officials were mum about the technical specifics of the process, making their lofty claims hard to verify until they prove it commercially with a plant that is up and running. They would say only that the process is related to technology developed in the company’s acetyls business and, like acetic acid, ethanol would be derived from a mixture of carbon monoxide and hydrogen known as synthesis gas.

Celanese recently has been more forthcoming about commercial plans for ethanol and the economics of the process, now dubbed TCX technology. At an investor day event in May, Steven M. Sterin, Celanese’s chief financial officer and president of its new advanced fuel technologies business, said that TCX could produce ethanol at a price of $60 per barrel of oil equivalent. At the time, he noted, corn-based ethanol and oil were selling for $100 per bbl.

This cost structure has made Celanese confident enough to undertake aggressive commercialization efforts. When it announced the technology in November, the company also said it will build in China one, and possibly a second, ethanol plant. Each plant would have an annual capacity of 400,000 metric tons and cost $300 million. The company also announced a technology development plant, with 40,000 metric tons of annual capacity, for its site in Clear Lake, Texas, which is due to start up next year.

In January, the company signed letters of intent with industrial park officials in Nanjing and Zhuhai, China, for construction of the ethanol plants. That same month, it signed a supply agreement with Wison, a Chinese firm that supplies coal-derived synthesis gas to Celanese’s acetic acid complex in Nanjing, for additional supply to a new ethanol plant. And in June, Celanese announced that a smaller, 200,000-ton facility will be “bolted on” to its Nanjing acetic acid complex by mid-2013, giving it ethanol capacity in China before the larger units are completed.

The TCX technology is the result of a comprehensive R&D effort in its acetyls business, Sterin says. That business makes acetic acid by carbonylation of methanol with carbon monoxide, two raw materials derived from synthesis gas.

Over the past decade, Sterin says, Celanese has made significant upgrades to its AO Plus carbonylation technology through improved process controls, optimized reaction conditions, enhanced raw materials, and better catalysts. A second-generation acetic acid technology, launched in 2009 and called AO Plus 2, boosts the capacity of a 1.2 million-metric-ton-per-year acetic acid plant to 1.5 million metric tons, he says. Earlier this year, Celanese unveiled another technology, called AO Plus 3, for plants of up to 1.8 million metric tons of capacity. “As a company over the last decade, we have learned a lot about significantly advanced technologies in the field of acetyls,” Sterin says.

About five years ago, Celanese launched a program to see whether it could apply its low-cost and rejuvenated acetyls chain toward making products that it had never produced before. The company came up with half a dozen candidates after it evaluated potential new markets. “Ethanol was one of the ones on the list,” Sterin says.

Two recent Celanese patents that stem from its R&D effort may offer clues about the chemistry behind TCX. One, issued in October 2009, describes hydrogenation of acetic acid to ethanol using cobalt and palladium catalysts. Another patent, issued this past January, describes the same reaction, but over platinum and tin catalysts.

Sterin won’t confirm that those patents are related to TCX. “We don’t practice everything we patent, and we don’t patent everything we practice,” he says. In addition, his comment keeps open the possibility that TCX could circumvent acetic acid as an intermediate and derive ethanol more directly from synthesis gas.

The process “goes from synthesis gas to ethanol with no material by-products,” Sterin says. “The way I can kind of prove that is in how we describe the economics. You can’t get there unless you have a highly selective process with as few steps in the manufacturing process as possible.”

Sterin expects ethanol could generate $1 billion in annual sales for Celanese by 2016. The first target market will be ethanol for industrial use—a market that is about 5 million metric tons globally today—and would have many of the same customers as its acetic acid business.

The market for ethanol as fuel is an order of magnitude larger than the industrial market. Sterin says Celanese isn’t an energy company and doesn’t plan on becoming one. Instead, it is exploring a model similar to that of the industrial gas industry, which constructs and operates plants on the sites of customers, such as oil refiners.

In addition, Celanese won’t pursue the fuels industry in the U.S. by using natural gas to make ethanol, Sterin says, because of the Renewable Fuel Standard. That law currently mandates that 14 billion gal of renewable fuels be blended into the U.S. transportation fuels stream. It drives ethanol derived from non-biobased sources out of contention. Down the road, Sterin says, Celanese may consider using biomass-derived synthesis gas as a feedstock in the U.S.

Geoffrey Styles, managing director of energy consulting firm GSW Strategy Group, says the Celanese technology is fascinating, but acknowledges that the lack of technical details makes it hard to evaluate.

For instance, Styles says, a potential advantage of TCX versus fermentation is the smaller amount of water produced. If Celanese uses hydrogenation of acetic acid, the process would yield a molecule of ethanol for every molecule of water. This proportion is much larger than the roughly 10% ethanol in water by volume obtained from fermentation of cornstarch.

Corn ethanol plants use a lot of natural gas to fuel furnaces for distilling the ethanol and for subsequent processing steps. By starting with a higher ethanol concentration, Styles says, TCX might eliminate much of that energy requirement.

Celanese’s business plan makes sense to Styles. “I would be doing the same thing if I were in their shoes,” he says. The ethanol market in the U.S. is saturated, with little prospect of additional blending of ethanol into the fuel stream without major change to vehicle fleets and infrastructure. “The whole proposition in the U.S. seems dicey to me,” he says. But China is continually looking for ways to turn its vast coal reserves into liquid fuel. “In China, the opportunity is potentially enormous,” he says.

Celanese officials express little doubt they are onto something big. “We are able to do what few have been able to accomplish, and that is produce liquid fuel from coal or natural gas economically and at industrial scale,” Sterin says. ◾

 
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Comments
Geoffrey Brooks (November 18, 2011 5:50 PM)
This sounds very interesting, is there a greater need for ethanol for autos? In the US, ethanol production is not profitable, but depends on government subsidies and changes in the rules by the EPA so that greater volumes can be blended in with gasoline. Is the syngas well purified - or - is it relatively crude, I am familiar with coal gas from my youthful days in the UK. Will this process be able to take advantage of the flue gases from a coal burning electricity generating facility?

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