KiOR: The Inside True Story of a Company Gone Wrong. Part 4, the Year of Living Disingenuously

No Eeyores at KiOR

Yet, by April 2012, management still expressed a stubborn belief that the Natchez commercial-scale plant would produce 80 gallon per ton yields. That month, CEO Fred Cannon wrote to staff announcing promotion of Ed Smith’, acknowledging of his accomplishments in building the pilot plants and the Columbus commercial plant on time and under budget.

In the memo, he could have not spelled out the proposed yields more clearly.

“Smith will oversee the construction of KiOR’ next commercial plan of 1,500 ton/120,000 gallon/day facility planned for Natchez.“ 120,000 gallons from 1500 tons of biomass: that’s an 80 gallon per ton yield. Yet yields in the Demo plant were no higher than the mid-30s, and technical staff feared that they would sink even lower in the commercial-scale plant at Columbus.

“It was the oil recovery,” O’Connor told The Digest. “The whole problem was there. Although some may speculate that the KiOR team were including water content in calculating oil yields, there’s no firm evidence for that. But some oil is so emulsified, that you can’t recover it, it goes out with the water when you separate. I believe that’s why the yields were low in actuality compared to what was being reported, They reported the oil content, not the oil they were capable of recovering. You only have to look at the trouble KiOR was getting into for the water that was being discharged by the plant. It was so full of oil that regulators were complaining.”

But, here, there is an ongoing disagreement between O’Connor and other members of the staff research team who spoke with The Digest, They contended that the real issue was that the bio-oil yields observed in the Pilot Plant and DEMO Unit, where the oil separation from water was very good, were about half of the required amount to be an economical and feasible process.