Renewable Route to Acrylic Acid Platts 2 nd Annual Renewable Chemicals BioAcrylic Acid Scaling Up Current Experience 1
Renewable BioAcrylic Acid Joint Development Objective Develop an Industrial-Scale Process to Cost- Effectively Produce Acrylic Acid from Sugar Sugar 3-Hydroxypropionic (3-HP) Acrylic Acid Slide 2 2
Dow Chemical-OPXBIO Strategic Partnership Faster, Lower-Risk, Shared-Cost Development and Commercialization Dow Largest US producer of petro-acrylic and derivatives Demonstrated capability to develop recovery technology and applications Committed bio-based strategy and investments OPXBIO Unique biocatalyst development capability Multiple products in development BioAcrylic joint development agreement Joint funding and work to demonstrate BioAcrylic process Intent to jointly commercialize Sugar Feedstock Microbe & 3-HP Bioprocess BioAA Conversion Process Commercial Plant Channel to Market Dow OPXBIO Dow Joint Dow 3
The Dow Chemical Company Corporate Overview Dow provides a diversified, industry-leading portfolio of technology-based products and solutions to customers in approximately 160 countries worldwide More than 5,000 products manufactured at 188 sites in 35 countries with 2011 sales of $60B 50,000 employees worldwide 4
Dow Performance Monomers Portfolio Acrylic Acid & Acrylates GAA, BA, EA, 2 EHA, MA Acrylic coatings, water treatment, detergent additives, adhesives, super absorbent polymers Methacrylates MMA, GMAA Acrylic sheet and resins, petroleum additives, plastic additives, electronic displays Specialty Monomers Hydroxies, GMA, BMA Automotive and industrial coatings, printing inks, and powder coatings Vinyl Acetate Monomers VAM Acrylic coatings, fibers, adhesives 5
Why Is This Project Important to Dow? Acrylic monomers are key strategic building blocks for several of Dow s market-facing businesses - coatings, personal care, packaging, building and construction Creating differentiated, sustainable product offerings for our customers is a top Dow priority Dow is interested in cost-effective, renewable alternatives to conventional petroleum-based feedstocks This project is an opportunity to commercialize a differentiated, bio-based acrylic acid product based on a fermentable sugar feedstock 6
Acrylates/Acrylic Acid Market Existing $8+ Billion Growing Global Market Customers interested in renewable alternative 7
Acrylates/Acrylic Acid Market Global Acrylic Acid Consumption Paper Products 5% U.S. End Uses for Acrylate Esters Plastics Additives 9% Textiles 15% Other 9% Adhesives and Sealants 18% Surface Coatings 44% Acrylic Esters 60% Glacial Acrylic Acid 40% Global Glacial Acrylic Acid End Use Polyacrylic Acid Polymers 30% Super Absorbent Polymers 70% Customers are asking for renewable options Improved sustainability / carbon footprint Increased consumer interest in green products Feedstock flexibility Source: SRI Feb 2011 8
BioAcrylic Acid Process Technology 1/2 Fermentation Dextrose (corn) or sucrose (cane) Genetically engineered E-Coli organism optimized via OPXBIO EDGE Technology Platform HO OH O 3-HP Recovery Biomass Kill & Removal Water Removal and Recycle - H 2 O C H 2 HO O Conversion to Acrylic Acid 3-HP Dehydration to Acrylic Acid Acrylic Acid Purification J. Repman 11/2/11 9
OPXBIO Strategy Grow a Large, Global, Profitable & Highly Valued Renewable Chemicals Company 10
OPXBIO EDGE Technology Platform Efficiency Directed Genome Engineering Massively Parallel Genetic Manipulations Quantitative Experimental Design Comprehensive & High Resolution Parallel Processing 11
OPXBIO EDGE Technology Platform Conventional Microbial Pathway Engineering Create random and unknown genetic variants in microbe population Test population and select better performing microbes Repeat to directionally evolve optimized microbe EDGE Microbe Engineering Create specific and known genetic variants across entire microbial genome Test each genetic variant and analyze performance Design comprehensive, rational strategy and construct optimized microbe 12
OPXBIO EDGE Technology for BioAcrylic 13
Fermentation Development Current at MBI Comml Plant TBD Lbs/Yr Pilot 250L 5K Lbs/Yr Demo Plant-1 3000L 60K Lbs/Yr Demo Plant-2 30k L 600K Lbs/Yr Sm Bench 1L 25 Lbs/Yr Lg Bench 10L 250 Lbs/Yr Shake Flask 100 ml 2008 2009 2009-10 2010 2011-12 2012-13 2014-16 14
BioAcrylic Acid Downstream Process Fermentation Development Highlights 3-HP Recovery Screening tests completed on >10 different processing schemes Scale-up validation in progress (batch and continuous lab-scale units) Developmental samples available 4Q 2012 Conversion to Acrylic Acid 15
Key Challenges - Sugar Price Volatility Sugar Price /lb Jul-02 Feb-03 Sep-03 Apr-04 Nov-04 Jun-05 Jan-06 Aug-06 Mar-07 Oct-07 May-08 Dec-08 Jul-09 Feb-10 Sep-10 Apr-11 Nov-11 Jun-12 Sugar prices will strongly influence bio acrylic acid market penetration 35 30 Historical Commodity Sugar Prices Challenges 25 20 15 10 5 0 Potential linkage to fuel prices Weather/seasonal impacts Feasibility of cellulosic sugar alternatives 16
Key Challenges - Impact of Shale Gas Natural Gas Price ($/MMBtu) Jul-02 Feb-03 Sep-03 Apr-04 Nov-04 Jun-05 Jan-06 Aug-06 Mar-07 Oct-07 May-08 Dec-08 Jul-09 Feb-10 Sep-10 Apr-11 Nov-11 Jun-12 Shale gas availability in U.S. will strongly influence long term conventional feedstock prices Historical U.S. Natural Gas Prices Challenges Impact on conventional acrylic acid economics Regional differences 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 17
Key Challenges Right Sizing of Plant Investments Challenges Capacity planning to meet customer demands Achieving economy of scale vs. overbuilding Feedstock selection Location / Integration options 18
Summary Dow and OPX are jointly developing a new industrialscale process for production of acrylic acid from sugar Excellent progress made on organism development, fermentation and downstream process scale-up Anticipate commercialization in 2014-2016 timeframe Sugar Feedstock Microbe & 3-HP Bioprocess BioAA Conversion Process Commercial Plant Channel to Market Dow OPXBIO Dow Joint Dow 19