Gevo, Porta jointly develop four isobutanol plants in Argentina

Gevo, Porta to jointly develop four isobutanol plants in Argentina

11:48 AM, 3rd February 2016
Gevo, Porta to jointly develop four isobutanol plants in Argentina
Dr Patrick Gruber, CEO, Gevo Inc. (File photo)

ENGLEWOOD, US: Gevo Inc said that it has entered into a license agreement and a joint development agreement with Porta Hnos SA (Porta) to construct multiple isobutanol plants in Argentina using corn as a feedstock.

The first plant is to be wholly owned by Porta and is anticipated to begin producing isobutanol in 2017. The plant is expected to have a production capacity of up to five million gallons of isobutanol per year. Based on projected isobutanol pricing, Gevo estimates that it could generate approximately $1 million in annual revenues once the plant is operational, through royalties, sales and marketing fees, and other revenue streams such as yeast sales.

The agreements also contemplate Porta constructing at least three additional isobutanol plants for certain of their existing ethanol plant customers. For these projects, Gevo would be the direct licensor of its technology and the marketer for any isobutanol produced, and would expect to receive all royalties and sales and marketing fees generated from these projects. Porta would provide the engineering, procurement and construction (EPC) services for the projects.

“Porta is a unique partner for Gevo, as they are expected to be both a direct isobutanol licensee, as well as a partner in building out isobutanol plants for other plant owners. We are excited to leverage their EPC expertise and their local Argentinean presence to accelerate the adoption of our isobutanol technology throughout Argentina, and potentially elsewhere in South America. We anticipate any revenue derived from the Porta relationship to be high margin in nature,” said Dr Patrick Gruber, CEO, Gevo.

“We appreciate Porta’s desire to be the first direct licensee of Gevo’s isobutanol technology, as well as their agreement to be our EPC partner in Argentina.  Consequently, we have agreed to waive an up-front license fee for the first plant that is to be wholly-owned by Porta,” said Gruber.

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