December 20, 2016 – Melanie Irwin, Blackburn News – Bio-succinic acid manufactured in Sarnia will be used to help BioAmber expand into markets overseas.
The Montreal-based company has signed a non-binding letter of intent with South Korean-based CJ CheiUedang Corporation (CJCJ).
In a news release, BioAmber says it’s planning to establish a joint venture (JV) in China to produce 36,000 metric tons of bio-succinic acid annually and commercialize the output in Asia.
CJCJ plans to cover the cost of retrofitting an existing fermentation facility with BioAmbers succinic acid technology, with production set to begin in the first quarter of 2018.
“While we remain focused on ramping up our Sarnia plant and building a second plant in North America, this JV is an opportunity for BioAmber to accelerate the deployment of its bio-succinic acid technology on a global scale without capital investment,” said BioAmber CEO Jean-Francois Huc. “This joint venture would allow us to quickly penetrate the Chinese and broader Asian market and accelerate cash flow and earnings for our shareholders. It would also serve as a blueprint for the build-out of additional bio-succinic acid production with very limited capital investment.”
As part of the letter of intent, BioAmber says it will be selling bio-succinic acid manufactured in Sarnia to undertake market development in China and South Korea in the first half of 2017.
“CJCJ has visited our Sarnia facility and we have visited their intended plant in China,” said BioAmber COO Fabrice Orecchioni. “Both partners are confident that the China plant can be reconfigured to quickly produce bio-succinic acid, for a fraction of what it cost us to build our Sarnia facility.”
The proposed joint venture is subject to certain conditions, with the definitive agreements expected to be signed by July 2017.
In September, BioAmber said Sarnia was still in the running for a second plant, which would be more than six times the size of the existing $141-million facility on Vidal St.
BioAmber has an option on land at TransAlta’s Bluewater Energy Park but is also considering sites in Louisiana and Iowa.
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