HP-L Lignin Production is the Key...As I'm fairly new to this type of investment, I've been trying to do some dd and better understand the progression of the ethanol industry and the potential for cellulosic ethanol production.
From reading the BCG report and info from LEC and the co-operative effort with Novozymes, I've come to the conclusion that cellulosic ethanol is or at least will be on the verge of global commercial competitiveness within the next 2 to 3 years, if not sooner as technologies are advancing efficiencies at an increasing rate.
Once, efficiencies of ethanol production are satisfied, ethanol being a form of
"GREEN ENERGY" should be adopted quicker and easier than other forms such as electric generation for transportation as transportation is the biggest consumer of ethanol production worldwide and feedstocks such as corn cannot sustain the growth in the industry.
With regards to LEC, they have a product that is unique to the production of cellulosic ethanol and that is HP-L Lignin as a by-product. All ethanol production has Lignin as a by-product but it is of lower quality and generally used as fuel for electric generating plants.
LEC is the only known company that has so far through its
patented process, produced HP-L Lignin for commercial use and is now selling it to trial customers.
Facts about HP-L Lignin from LEC's website:
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HP-LTM Lignin
Lignin is a natural polymer that binds cellulosic fibres to strengthen plant structures. It must be
treated or removed in order to efficiently convert cellulose to ethanol. Lignins typically produced
by the pulp and paper industry and by competing technologies in the cellulosic ethanol industry,
contain certain impurities which result in poor quality lignin of variable consistency and
functionality that are generally unsuitable for certain higher value industrial and commercial uses.
In contrast, Lignol’s unique biorefinery process extracts a high purity form of functionalized lignin,
which Lignol has termed HP-LTM lignin (“HP-LTM lignin”). HP-LTM lignin represents a new class ofhigh purity lignin extractives (and their subsequent derivatives) which can be engineered to meet
the chemical properties and functional requirements of a range of industrial applications that until
now has not been possible with traditional lignin by-products generated from other processes.
HP-LTM lignin and related lignin derivatives can significantly increase the oil displacement value ofthe Lignol biorefining technology. HP-LTM lignin can be used in place of oil derivatives as a baseproduct for many new specialty chemical product applications which has a potential industrial
scale market opportunity valued in excess of US$2 billion (International Lignin Institute, Eurolignin
Network Project, 2005).
Lignol believes that the information that is being generated from its pilot-scale biorefinery
provides a significant competitive advantage over those competitors who have yet to build a pilotscale
biorefinery. The Lignol pilot-scale biorefinery represents one of only a handful of fully
integrated second generation cellulosic ethanol pilot plants operating in the world today producing
cellulosic ethanol and lignins, and the only known source of industrial-scale quantities of
organosolv type lignin and Lignol’s unique HP-LTM lignin and their derivatives engineered forspecific industrial applications.
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So IMO, in order for LEC to be successful with their cellulosic ethanol production they must first show commercial success of their HP-L Lignin product that they are currently selling to their
development partners for industrial production trials.
Once these trials are complete, I would hope that assuming successful results, Lignol will be in a better position to negotiate a JV Deal to construct a large commercial ethanol plant with a well recognized global leader in ethanol production, thus exploiting their patented HP-L Lignin technology that in theory should make cellulosic production of ethanol cost efficient and competitive on a global scale.
That's my 2 cents and that's how I see things transpiring if the current HP-L Lignin trials are successful. I don't see money as a problem going forward if trials go well. atb
Comment welcome and appreciated.