KiOR: the inside true story of a company gone wrong, Part 2

“We need 2X”

By June 2009, the Stealth Team, working with zeolite catalysts in the Pilot Plant, were showing enhanced yields and bio-oil quality. At the same time, literature searches turned up projects from the 1980s and 1990s demonstrating that the same type of Zeolite (ZSM) had been used before in Catalytic Pyrolysis.

But with the improvement, KiOR yields approached a maximum of 40 gallons per ton with reasonable quality. “Higher yields would have been simply contained more oxygen, that would have needed to be removed to convert the bio-oil to transportation fuel,” Stamires told The Digest.

A progress update was held on June 3rd with Khosla, Samir, Cannon, Ditsch, O’Connor and others, Bartek reported the figures.

Khosla’s response was to request of the R&D team that they double the yields over the next 6-8 months. The improvements were not from outer space. They were the kind of yields that would have made the overall process economically sustainable and profitable, without government subsidy, in commercial-scale plants. A participant in the meeting reported to The Digest that certain milestones for monthly incremental increases were established to reach the target.

Possible? Yes. With the existing BCC technology. In the view of one wing of KiOR’s staff, no. Given management’s reluctance to change the R&D plan, add a reactor to the process, hire scientists who could accomplish these goals, numerous members of the scientific team were pessimistic both in terms of the target and the timeline.

Concerns were high, as commercial discussions with Chevron and Weyerhaeuser (as the JV Catchlight Energy) were well underway. As one team member put it, “if Chevron finds out, they will run away from KiOR and essentially seal KiOR’s fate from any future partnerships with Big Oil, and Khosla would pull his funding.”

The race for 2X gets underway

The search for catalysts was underway at a rapid pace.

Cannon approved the request of Brady, Bartek and Stamires to start making KiOR’s own calcined clay microspheres using the spray dryer. The main objective of this work was to develop clay-based microspheres which exhibited acted both as efficient heat carriers, and catalysts with controlled selective activity.

Having then optimized the Physical properties of the calcined microspheres with respect to Bio-oil yield and quality, Brady, Bartek and Stamires proceeded to optimize the chemical/catalytic properties of the calcined microspheres. Then Brady proceeded to prepare clay microspheres with different amounts of catalytically active metal salts — magnesium, calcium, potassium, sodium, and aluminum among others.

In addition, Professor Iaocovos Vasalos re-appeared as a consultant by September 2009. Subsequently, Prof. Vasalos confirmed to Cannon that in order to achieve reproducible Bio oil Yields close to Khosla’s 2X target, with a reasonable quality, certain “radical changes must be made in the design of the pilot plant and to the process.”

The urgency was not only the usual pace of s start-up hungry for milestones that would encourage investments, there was Catchlight Energy relationship looming. In an email from Dan Strope, VP Technology, sent Aug. 11 2009 to the staff, it was revealed that Andre Ditsch was officially heading the negotiations with Chevron, and Ditsch was asking for technology data to prepare an economic forecast for a commercial size plant.