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

Yields improve, but trouble looms

In an email to Fred Cannon and Andre Ditsch on September 23rd, Bartek reported pilot plant data confirming that the ZSM catalysts produced much higher hydrocarbon yields, as the BCC Catalyst (HTC ) was converting them to gas and coke. The oxygen was in the range of 10 to 15%, but the yields were still stuck in the low 40s. With these results, the decision was taken in late 2009 to suspend work on the BCC technology  at  the three European Labs as well at KiOR’ Lab  in Houston.

Paul O’Connor, still on the KiOR board at this time, blasted the decision to use ZSM-5 catalyst.

“It was the worst decision ever made, ZSM-5. We all knew that to make this process economic we needed a cheap catalyst. ZSM-5 is one of the most expensive around. Plus, you are dealing with a biomass with calcium and many other things in it, and with ZSM 5 you kill the catalyst. It’s so strange they went in that direction.”

But yields at least were up. A 20-30% jump in yields, but catalyst performance, the science team concluded, would not improve anywhere as fast as the 2X target required. In a memo dated Sept. 6, 2009, Stamires proposed a radically different Biomass Conversion system, comprising two Reactors in series or in parallel, with a new catalyst.

The approach? The Biomass in the first Reactor would be thermally Liquefied in a fluidized bed using a high-efficiency heat transferring medium which has a high heat capacity (such as sand ). The Bio oil vapors generated in the first Reactor would then be reacted with a medium  activity catalyst in the Second Rector. The invention was subsequently patented by KiOR .

Meanwhile, Ditsch was pressing hard. In emails of Sept. 16 and 17, 2009, he was asking for information to be used in his presentation and “KiOR Update” to Khosla on the 17th .

From that update, Khosla agreed to relax the timeline for process improvement, but not sacrifice the yield target, which would have been in the 80s and into the 90 gallons per ton range. The 2X milestone target was set for Q4 2010. But the scientific team — at least one wing — didn’t believe that anything like those yields could be achieved with anything like the technology that KiOR was readying for commercial-scale.

Stuck in the 40s Doldrums

New catalyst materials were tested in KiOR’s Pilot KCR plant in October and November 2009 Bartek and reported by Patrick Steed in a January 7, 2010 email confirmed the improvement in catalytic activity, while retaining their good heat-transferring properties.

But, the good results came with a ceiling. In their own way, they confirmed to members of the science team, as sources told The Digest, that KiOR was likely to become stuck in a range which would never get much out of the 40s, expressed in gallons per ton.