Genomatica and Novamont in butanediol JV

LSRUNQI

Genomatica and Novamont in butanediol JV
Wednesday, August 24, 2011

San Diego, CA and Novara, Italy - Genomatica and Novamont announced they have signed a letter of intent to establish a joint venture that is expected to lead to the first industrial plants in Europe producing butanediol (BDO) from renewable feedstocks. Novamont, a leading producer of biodegradable bioplastics, will consume the BDO for captive use to meet the increasing demand for its products. The first plant is expected to have a production capacity of approximately 40 million pounds per year and will be located in Italy. The companies intend to convert an existing industrial site to use Genomatica’s BDO production processes to begin production of this intermediate chemical by the end of 2012. Key terms of the letter of intent include that Novamont will provide the capital needed for construction of the first plant. In addition, Novamont will commit to purchase the production output from the first plant. Genomatica will have an option on a portion of the BDO production. Genomatica and Novamont will share in the earnings of plants according to specific terms between the companies. Novamont will take care of the conversion of an existing industrial site using its skills in the production of renewable monomers to implement Genomatica’s BDO process and will run plant operations, while Genomatica will provide the basic engineering package for implementation of its BDO production processes, along with technology transfer and engineering support.