Gevo Inc. and Butamax Advanced Biofuels have agreed to share patents and licensure on bio-based isobutanol, ending years of litigation between the two companies.
The agreement, which creates a new development relationship between the two companies, means that isobutanol production will increase at the Luverne plant (formerly Agri-Energy Ethanol Plant).
“We actually have been running IBA in limited campaigns this year. In fact, we just finished one,” said Gevo CEO Patrick Gruber.
“The fermentation technology is working well. We will be turning our attention to establishing continuous IBA production at Luverne now that this is behind us. We need to install some more equipment at the plant, like a distillation column.”
According to company statements released Monday, the new relationship between Gevo and Butamax is aimed at leveraging each other’s strengths and accelerating development of competitive supply for bio-based isobutanol.
The cross-license agreement grants both parties patent licenses to all fields for isobutanol and is structured to develop sustainable isobutanol markets.
The license will be royalty-bearing for Butamax in certain fields and royalty-bearing for Gevo in other fields.
There are also a number of fields that are royalty-free for both companies. Both parties can sell up to 30 million gallons per year royalty-free into any field.
Butamax to lead development for road fuel
Butamax (a joint venture between BP and DuPont) will take the lead role in developing the market for isobutanol as an on-road gasoline blendstock.
This will include progressing ongoing programs to gain required EPA approvals for mainstream use of 16 percent isobutanol as a gasoline blend component.
Butamax has also conducted joint research with Underwriters Laboratories, which has demonstrated that these blends can be used safely in fuel storage and dispensing equipment.
This could clear the way for state government agencies to approve dispensing biobutanol-gasoline fuel blends in the United States.
Gevo to lead development for jet fuel market
In parallel, Gevo will lead development of the jet fuel market.
Gevo has been producing and selling alcohol-to-jet fuel (ATJ) derived from isobutanol since 2011.
To date, Gevo's ATJ has been produced at its demo biorefinery in Silsbee, Texas, using isobutanol produced at its Luverne, Minnesota, fermentation facility.
The company has successfully flown test flights with the U.S. Air Force, U.S. Army and U.S. Navy and now expects to secure the MIL-SPEC certification (JP-8 and JP-5) enabling bids on future renewable jet fuel by the Defense Logistics Agency.
Gevo also intends to begin test flights with the commercial aviation industry, including Alaska Airlines, following receipt of ASTM International certification, expected before the end of 2015.
While Butamax and Gevo have cross-licensed all of their patents for making and using isobutanol, both parties will have their own biocatalyst and process technologies.
“We are very pleased to have reached this amicable and fair settlement. Setting up the marketing relationships, as we have done, brings to bear the capabilities of each of the companies,” Gruber said.
“We very much look forward to developing a very large, growing and profitable isobutanol market in conjunction with Butamax.”
Paul Beckwith, Butamax CEO, agreed.
“The aim of these agreements is to accelerate development of markets for bio-based isobutanol,” Beckwith said.
“This will create exciting opportunities for ethanol producers to expand their businesses by becoming isobutanol producers, at the same time enabling the most competitive isobutanol supply for customers.”