Amyris announced today a contract manufacturing deal to make specialty chemicals from sugar cane in Brazil, marking the first time the chemical and biofuels company will produce at industrial scale.
The Emeryville, Calif.-based company has contracted with Biomin do BrasilNiutrciao to use its facilities to manufacture a chemical called farnesene, which is used for cosmetic products and lubricants. Production is slated to begin next month.
Amyris will supply sugar cane syrup and fermentation equipment while Biomin will operate the plant, an arrangement that allows Amyris to begin production at commercial scale quicker than building its own facilities, said Jeri Hilleman, the company's chief financial officer.
Through a joint venture, Amyris is in the process of building its own facility in Brazil, which will take 18 months (and is scheduled for completion next year), while the deal with Biomin took about six months and relatively little capital, Hilleman said. Amyris has other contract manufacturing arrangements in Europe and the U.S.
"Everything we've done until now has been in much smaller quantities and has been done for testing. Now we're starting up full industrial scale. These fermenters can produce 100,000 to 200,000 liters per year," Hilleman said. "We believe we're the first...to get this technology to production scale."
Biomen already operates industrial fermenters to make animal feed. In its contract with Amyris, it will use Amyris' yeast, which is engineered specifically to produce hydrocarbon chemicals. Amyris will either sell farnesene, which it sells under the brand name Biofene, or it will treat the chemicals slightly and sell them for specific applications, such as lubricants.
The products themselves are replacements for petroleum or other natural oils, but they will be cheaper and be made from a renewable resource. In the case of lubricants and diesel fuels, which Amyris intends to manufacture later, Amyris products have better environmental attributes, including 80 percent reduction in greenhouse gases, no sulfur, and low smog-causing air pollutants, Hilleman said.
Scaling up energy-related companies, such as Amyris, has proved to be one of the most difficult challenges for a wave of green-tech companies started over the past 10 years. Hilleman said that using a contract manufacturer was the quickest and easiest way to operate at industrial scale and generate more revenue this year, rather than next.