Inaeris Technologies, LLC
We are Inaeris Technologies – a cutting-edge biofuel technology company advancing the development of a proprietary technology platform that transforms non-food biomass into drop-in hydrocarbon transportation fuel blendstocks. Our technology platform can provide new, alternative sources of hydrocarbon transportation fuels – sustainably – using a variety of renewable feedstocks to help promote energy security and combat global warming through reduced lifecycle greenhouse gas emissions. Our technology is flexible and can be commercialized either as a stand-alone facility or as an addition to an existing facility, such as one that already processes biomass (a pulp/paper mill) or produces fuels (a petroleum refinery). Nearly one million gallons of cellulosic gasoline and diesel blendstocks have been produced using our technology and distributed seamlessly through the existing fuel infrastructure in the United States to power today’s cars and trucks.
In 2007, KiOR was founded by Khosla Ventures and a group of catalyst scientists who shared a vision of making renewable fuels from cellulosic biomass through a one-step catalytic process. A truly innovative process never before attempted, the catalytic conversion of biomass to a hydrocarbon fuel had potential global implications, since it relied on a simple, inexpensive conversion process and an abundant, low cost feedstock. Through this vision, biomass-derived fuel could be produced in seconds, versus the millions of years it takes to produce fossil fuels in nature.
Khosla Ventures (KV) is one of the US’s most prolific biofuels venture capital firms with ambitious investments in both cellulosic ethanol producers as well as those targeting hydrocarbon based 'drop-in fuel' replacements. KV’s involvement with what would become KiOR started with a call from an engineer from Holland to Vinod Khosla, KV’s founder and visionary advocate of renewable fuels.
The concept – a high-value hydrocarbon created from biomass rather than an alcohol-based fuel like ethanol, where Mr. Khosla had been focusing – immediately resonated with him, as he realized its potential for meeting the world's need for petroleum fuel alternatives. In contrast to the inventor’s interest in a licensing business model, KV envisioned that the KiOR process could lead to an oil exploration and production company without the exploration risk.
Implementing KV’s gene pool engineering methodology, a recruiting method focused on risk mitigation and fit, KV targeted the hiring of mission critical technologists to the company, ultimately leading to the hiring of Fred Cannon as KiOR’s President, and later CEO. With both location and leadership set, KV made a follow on $10 million investment in KiOR to fund the Company’s ambitious R&D program and pilot plant.
Proving the Concept
The pilot plant was an opportunity for KiOR’s proof of concept: that abundant cellulosic feedstock could be converted into renewable crude oil through a scalable, relatively inexpensive catalytic process. It became clear that the technology was far from ready. Though the initial technology approach failed, the new team set to work with single-minded focus and re-invented the technology. Remarkably, by the time the pilot came online, the team had innovated an entirely new process, one that yielded better product, economics and ease of scalability.
Encouraged by technical success at KiOR’s pilot scale, and in spite of the worst economic crisis since the Great Depression, KiOR and KV accelerated the time scale after just a few months of testing on the pilot plant and began work on a demonstration unit. On New Year's Day, 2010, the demonstration unit was installed, representing a 400 times scale up from the pilot. With the demonstration plant's capacity to process 10 dry tons of wood and produce up to 15 barrels of product per day, a commercial unit would be less than 50 times further scale up, which is considered a small scale-up in the vast operating history of FCC units.
Underlying the entire process has been KV’s steadfast focus on IP advancements and patents (to date, the company has 70 patents and over 2,000 pending IP claims across all aspects of its process).
Having demonstrated the technical feasibility and scale of its process, it was time for KiOR to move on to commercial production. KiOR's 'drop in' advantages intrigued potential customers, including a number of oil companies. Negotiations began in earnest, with potential customers eager to capitalize on KiOR's technological promise. For most venture-backed startups this would be a dream; for this high potential KV company, the momentum was lock in step with its aspirations.
To fund its first commercial production unit, two of Khosla Venture’s trusted financial partners, AIMCO & Artis, joined KV in a large equity round of financing. KV's advisors then arranged meetings with three Southeastern governors to discuss the facility's location. Within a weekend, KiOR had agreed to build in Mississippi, due to Governor Haley Barbour's enthusiasm for the company and the benefits it could offer the people of his state. Within a few months, the MS legislature approved a $75M interest-free loan for the plant in September of 2010. By the first quarter of 2011, construction was under way for an initial scale commercial production facility in Columbus, MS, which would process 500 BDT of feedstock a day and produce approximately 11 million gallons of renewable fuels per year.
KiOR continues to make progress on its Columbus plant, which is slated to open in the second half of 2012. However, one plant is not enough to meet the company's ambitious goals. As construction progresses in Columbus, the company has already begun planning for larger, 1,500 BDT per day, standard commercial production facilities. It is as at this scale that the company believes it will truly be able to match its ambitions, and compete not only with other biofuels producers, but with oil production offshore and from tar sands.
Encouraged by its progress to date, KiOR has developed a strategic plan to continue its growth, and ultimately to begin producing commercial volumes of cost competitive gasoline and diesel blendstocks without government subsidies. Having added a CFO, General Counsel, President of International, and COO, KiOR believes it now has the world-class management team it needs to deliver accelerated growth.
KiOR is a next-generation renewable fuels company. Our mission is to produce renewable fuels in a profitable yet sustainable manner. We strive to achieve environmental and social benefits by achieving a negative carbon footprint, responsibly managing our land use and water resources, and preserving our forests and food sources, while promoting energy independence, job creation and community investment.
Through our proprietary technology platform, we expect to provide new domestic sources of liquid transportation fuels — sustainably — using a variety of renewable natural resources to help further energy independence and reduce greenhouse gas emissions. According to TIAX LLC, our gasoline and diesel blendstocks are projected to reduce direct lifecycle greenhouse gas emissions by over 80% compared to the fuels they displace.
We believe that the solution to the world’s growing transportation fuel demands must be:
Real. Our technology produces high-quality hydrocarbon blendstocks that we believe will “drop in” to the existing transportation fuels infrastructure for use in vehicles on the road today. Unlike ethanol, which is generally subject to a 10% to 15% blend wall, our gasoline and diesel blendstocks can be combined with petroleum based fuels and used as components in a variety of final fuel products.
Renewable. Our proprietary technology platform allows us to convert a wide variety of low-cost, abundant and sustainable non-food biomass, including woody biomass, such as whole tree chips, logging residues, branches and bark; agricultural residues, such as sugarcane bagasse; and energy crops, such as switchgrass and miscanthus, into renewable transportation fuels.
Rural. We plan to locate our commercial production facilities in rural areas near sources of low-cost, abundant and sustainable biomass, which we believe will help revitalize rural communities impacted by closed paper mills.
Repeatable. We plan to employ a modular design for our standard commercial production facilities that can be replicated in numerous locations with abundant and sustainable non-food feedstock in the southeastern United States and beyond. We believe that this “copy exact” design will help us to reduce our capital costs, implement learned best practices and facilitate rapid deployment of new production facilities.
The US currently meets approximately 65% of its annual crude oil needs with foreign imports. Additionally, global oil demand is expected to grow by over 20% through 2030, outpacing the growth of oil supply. KiOR’s fuels from renewable crude can be safely produced domestically and can help reduce the amount spent annually on foreign oil imports.
KiOR’s renewable fuel production facilities will provide high-quality jobs and stimulate economic growth in rural communities across the world. Depending on the specific size, each KiOR facility will create hundreds of direct, indirect and induced local jobs in industries such as forestry, manufacturing, and construction.
KiOR's renewable fuel production process can contribute to the reduction of greenhouse gas emissions. According to a February 2011 analysis performed by TIAX LLC, a leading technology processing and commericliazation company, KiOR's gasoline and diesel blendstocks are projeted to reduce direct lifecycle greenhouse gas emissions by over 80% compared to the fuels they displace.
KiOR has developed a proprietary technology platform to convert sustainable, low-cost, non-food biomass into a hydrocarbon-based renewable crude oil. Using standard refining equipment, the company processes its renewable crude into gasoline and diesel blendstocks that can utilize the existing transportation fuel infrastructure for use in vehicles on the road today.
In essence, KiOR’s technology simply reduces the time it takes to produce oil from millions of years to a matter of seconds. The company’s technology platform combines its proprietary catalyst systems with a process based on existing Fluid Catalytic Cracking (FCC) technology, a standard process used for over 60 years in oil refining. The efficiency of KiOR’s process, called Biomass Fluid Catalytic Cracking (BFCC), and the proven nature of catalytic cracking technologies allow for significant cost advantages, including lower capital and operating costs, versus traditional biofuels producers.
KiOR processes its renewable crude oil in a conventional hydrotreater, which is a standard process unit used in oil refineries, into gasoline and diesel blendstocks that can be combined with existing fossil-based fuels and used in vehicles on the road today.
Below is a step-by-step overview of KiOR’s process. Roll over the numbers to learn more about each step and click the play button to see an animation of the process.
Since its inception, KiOR has performed extensive research to develop, refine and commercialize its biomass-to-renewable fuel technology. That technology is now being utilized on a commercial scale at the company's Columbus facility.
After successfully producing renewable crude oil at laboratory and pilot scales, KiOR demonstrated the scalability of its Biomass Fluid Catalytic Cracking (BFCC) process through a demonstration unit 400-times the size of its pilot plant. The demonstration unit amassed sufficient operating hours and production to provide KiOR the data and proof of concept needed to begin building its first commercial-scale plant in 2011.
The Columbus facility represents a 50-times scale up from KiOR's demonstration unit. KiOR’s BFCC process leverages Fluid Catalytic Cracking, a proven technology used in oil refineries and often scaled from less than one barrel per day to over 50,000 barrels per day at commercial scale, helps to further reduce KiOR's own BFCC scale-up risk.
KiOR achieved significant scale up of its technology at research and demonstration facilities. This led to the construction of its first commercial scale production facility in Columbus, Mississippi, which began shipping cellulosic fuels in early 2013.
Beyond Columbus, KiOR intends to construct larger standard commercial production facilities designed to be approximately three times the size of our Columbus facility. These will utilize a centralized hydrotreating unit to support multiple standard commercial production facilities in order to take advantage of economies of scale.
KiOR believes it will be able to scale rapidly due to its commitment to “copy exact” principles and low-cost modular facility design. This design allows for easy replication of subsequent standard commercial production facilities, which should enable it to reduce capital costs significantly compared to other biofuel technologies.
By staging the expansion of its standard commercial facilities in discrete facility-by-facility projects that are independently viable, KiOR believes that it will have flexibility to plan its growth, both domestically and internationally.