MEGATRENDS Mid Term Economics

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1 Biorefinaria de Cana e os Plásticos Sustentáveis Sustainable Sugarcane Biorefinery CTC Centro de Tecnologia Canavieira MEGATRENDS Mid Term Economics Much slower growth in the developed world Accelerating growth in the developing world World population stabilizing at 9-10 billion 6-7 x world GDP growth over next 50 or so years (in constant dollars) 5-6 x existing production capacity for most commodities (steel, chemicals, lumber, etc.) 3.5 x increase in energy demand 7x increase in electricity demand Jeffrey J. Siirola Eastman Chemical Company Kingsport, TN

2 MEGATRENDS Source: GM - Ceres MEGATRENDS Source: GM - Ceres 2

3 MEGATRENDS Chemicals and Biobased 3

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5 Raw Material Selection Characteristics Availability Accessability Concentration Cost of extraction (impact, resources) Competition for material Alternatives "Close" in chemical or physical structure "Close" in oxidation Jeffrey J. Siirola Eastman Chemical Company Kingsport, TN

6 "Oxidation States" of Carbon -4 Methane -2 Hydrocarbons, Alcohols, Oil -1 Aromatics, Lipids 0 Carbohydrates, Coal +2 Carbon Monoxide +4 Carbon Dioxide Most polymers Most oxygenated Jeffrey J. Siirola Eastman Chemical Company Kingsport, TN Matching Raw Material and Product Oxidation States / Energy Jeffrey J. Siirola Eastman Chemical Company Kingsport, TN

7 Global Reduced Carbon Recoverable Gas Reserves 75 GTC Recoverable Oil Reserves 120 GTC Recoverable Coal 925 GTC Estimated Oil Shale (xisto) 225 GTC Estimated Tar Sands 250 GTC Estimated Remaining Fossil (at future higher price / yet-to- bedeveloped technology) 2500 GTC Possible Methane Hydrates???? GTC Terrestrial Biomass 500 GTC Peat and Soil Carbon 2000 GTC Annual Terrestrial Biomass Production 60 GTC/yr (more than half in tropical forest and tropical savanna) Organic Chemical Production 0.3 GTC/yr Jeffrey J. Siirola Eastman Chemical Company Kingsport, TN Global Oxidized Carbon Atmospheric CO2 (380ppmv) 750 GTC Estimated Oceanic Inorganic Carbon (30ppm) GTC Estimated Limestone/Dolomite/Chalk GTC Jeffrey J. Siirola Eastman Chemical Company Kingsport, TN

8 Which is the sustainable raw material? from a Chemical Industry Perspective The most abundant (carbonate)? The one for which a "natural" process exists for part of the required endothermic oxidation state change (atmospheric carbon dioxide)? The one likely to require the least additional energy to process into final product (oil)? The one likely to produce energy for export in addition to that required to process into final product (gas)? The one likely least contaminated (methane or condensate)? The one most similar in structure (perhaps biomass)? A compromise: abundant, close oxidation state, easily removed contaminants, generally dry (coal)? Jeffrey J. Siirola Eastman Chemical Company Kingsport, TN Challenging The Chemical Industry Most new chemical capacity will be built near the customer (except when the raw material is stranded gas) Some new processes will be built to substitute for declining availability of natural gas, condensate, and aromatics Some new processes will be built implementing new routes to intermediates currently derived from methane, olefins, and aromatics Catalysis, process chemistry, and process engineering innovations will be critical 8

9 Conclusions from a Chemical Industry Perspective Natural gas, condensate, and oil (inexpensive) will become depleted With enough capital, can get to any carbon oxidation state from any other, but reducing oxidation state costs energy There will be a shift to higher oxidation state starting materials including coal and biomass for chemical and fuel production, with corresponding increases in CO2 generation Naphtha prices May -August

10 Source: DSM Peter Nossin 10

11 SUSTAINABILITY IN SUGAR CANE PROCESSING IN BRAZIL Footprint SUSTAINABILITY IN SUGAR CANE PROCESSING IN BRAZIL Footprint 11

12 SUSTAINABILITY IN SUGAR CANE PROCESSING IN BRAZIL Footprint SUSTAINABILITY IN SUGAR CANE PROCESSING IN BRAZIL Footprint 12

13 SUSTAINABILITY IN SUGAR CANE PROCESSING IN BRAZIL GHG Abatement McKinsey 2009 SUSTAINABILITY IN SUGAR CANE PROCESSING IN BRAZIL Sugar Cane Production in Brazil Occupies less than 10% of the commercial agricultural area or less than 2% Brazil Has no effect on deforestation Responsible for more than 500,000 direct jobs with very high percentage of formalization Adapted varieties: No irrigation, much less fertilizer, much less chemicals 13

14 SUSTAINABILITY IN SUGAR CANE PROCESSING IN BRAZIL Sugar Cane Processing Productivity Producing more with the same equipment Efficiency Producing more with the same raw material Reducing losses and emissions - pollution Energy Producing more with the same energy Water Producing more with the same water Chemicals Producing more with the same chemicals Less contamination - pollution Breaktrough: 2nd generation ethanol 2nd Generation Ethanol: till 200 liters/t bagasse with partners 28 14

15 Breakthrough: Gasification Bagasse, Trash Air, O 2, and/or steam Electricity Drying Sizing Gasification (1 to 30 bar) Gas cleaning Gas Turbine Heat Recovery Steam Turbine BGCC Process steam Water Gas Shift (CO+H 2 O H 2 +CO 2 ) CO, H 2, CH 4, CO 2 Biomass to Liquids CO 2 Removal Catalytic Synthesis Steam & Power Generation Distillation or Refining Biofuel or SNG Process steam/elec. Hybrid thermochem/biochem fuels production Fermentation Distillation or Refining Alcohols Steam & Power Generation Process steam/elec. 29 Production potential for different products from sugarcane biomass Surplus Electricity (100% bag + 50% trash + meeting mill process steam and electricity needs) Electricity Generation kwh per tonne cane* Steam cycle, 67 bar, 490 o C 108 Steam cycle, 100 bar, 520 o C 118 Gasification-GTCC 210 Liquid Fuels Production (50% bag + 50% trash) Liquid Fuels Production Liters per tonne cane* Ethanol Current technology [1] (C6 Cellusose only) 38.7 Future (2015?) (C5 technology and C6 ) [2] 50.1 FT Diesel + FT Gasoline** [3] Diesel-equivalent liters 29.5 Ethanol-equivalent liters 50.1 Dimethyl ether DME liters 63.2 LPG-equivalent liters 47.4 Diesel-equivalent liters 33.6 Ethanol-equivalent liters 56.7 Nitrogen Fertilizer Prod (50% bag + 50% trash) Nitrogen Fertilizer Production Kg of contained N per tonne cane*** Ammonia HIDROLYSIS GASIFICATION 15

16 Biorefinery vinasse Fertilizer concentrate yeast Extracts, ingredients biogas Natural gas Sugarcane biodiesel Mature ethanol sucrose Sugar chemistry hydrogen alcoolchemistry energy diesel Growing biomass ethanol polimers PHA NH 3 IPT SP Nascent gaseification Producer gas methanol 16

17 EVOLUTION OF MILLING CAPACITY TCH Original I II III IV PHASE 17

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