M&G Chemicals announces its decision to construct a second-generation bio-refinery in the region of Fuyang, Anhui Province of China for the conversion of one million metric tons of biomass into bio-ethanol and bio-glycols.

The project is expected to be realized through a joint-venture with Chinese company Guozhen which will make available one million metric tons of straw biomass and use the lignin resulting as a by-product from the bio-refinery to feed a 45 MW cogeneration plant which will be constructed at the same time as the bio-refinery in the same site. M&G Chemicals will be majority partner of the bio-refinery and minority partner of the power plant.

The bio-refinery will employ PROESA  technology licensed from Beta Renewables, a joint venture between Biochemtex (a company belonging to the Mossi Ghisolfi Group), US private equity fund TPG and Danish enzyme producer Novozymes.

The second-generation bio-refinery will be approximately four times the size (measured by volume of biomass processed) of that built by Beta Renewables in Crescentino, Italy, which was recently inaugurated.

The plant, which is expected to require capital expenditures of approximately half a billion US dollars, is expected to be brought on stream in mid 2015.

Necessary enzymes will be supplied by Novozymes, one of the world’s largest enzymes producers and one of the partners in the Beta Renewables joint venture, which owns the rights of the PROESA technology.

“This is the first act of a green revolution that M&G Chemicals is bringing to the polyester chain to provide environmental sustainability to both PET beverage packaging and polyester textile” said Mr. Marco Ghisolfi, CEO of M&G Chemicals. “The timing and scope of our green polyester revolution and our manufacturing entry in China from the green PET raw materials avenue is even more relevant considering The Coca-Cola Company has announced plans to use PlantBottle packaging, which is partially made from plants, for all of their PET plastic bottles across the globe by 2020.”, Marco Ghisolfi added.

“M&G Chemicals is today taking a big step towards a bio-based society where biomass is used for products like fuel, chemicals and plastics. We are incredibly excited to enable M&G Chemicals’ vision of producing bio-plastics on a commercial scale and are looking forward to the long-term collaboration”, says Thomas Videbæk, Executive Vice President and Head of Business Development in Novozymes.

“The second-generation bio-refinery and power cogeneration project is the core part of the Biomass Utilization Park that Guozhen plans to build in Fuyang City. Fuyang is rich in biomass resources; Guozhen is experienced in biomass collections and logistics; and M&G Chemicals owns the proven cutting-edge technology. Our cooperation will open a new era of biomass utilization and provide an effective solution for the full exploitation of biomass to tackle Chinese energy demand and environmental issues,” said Mr. Li Wei, Chairman of Guozhen Group.

“Fuyang City is a large agricultural region in northwest Anhui Province. The crop planting area is up to 1.2 million hectares with 6 MMt/y of straw biomass available. The second-generation bio-refinery and power cogeneration projects planned by M&G Chemicals and Guozhen Group are technologically advanced, economically feasible and environmentally friendly. Fuyang City will provide full support to biomass collection, site selection, and land acquisition with incentive policies.” said Mr. Lu Shiren, Standing Deputy Mayor of Fuyang City, Anhui Province.