Rentech, UOP expand clean fuel offerings

UOP said today it's added another technology to the alliance it established last year with Los Angeles-based synthetic fuels and fertilizer company Rentech (AMEX:RTK).

Rentech's technology, based on the Fischer-Tropsch process, makes synthetic fuel from biomass, sewage sludge, natural gas and coal. Rentech inked a deal last year to use UOP's technology to help the process, and today's announcement marks the second time Rentech is incorporating UOP's hardware.

Susan Gross, UOP's communications manager, said today the alliance allows the two companies to offer a single solution to refiners, who would otherwise need to buy multiple products from different suppliers. Rentech's expertise lies in syngas to hydrocarbon synthesis, while UOP has experience in hydrocarbon conversion.

"We're thinking together and continually trying to enhance the offering," Gross told the Cleantech Group. "It's a one-source solution as opposed to multiple contracts and engineners, and a lot of times that can be really cumbersome for a refiner."

In Rentech's process, the feedstock goes through a proprietary gasifier to create syngas, which is then cleaned by Rentech's technology. The pure hydrogen and carbon monoxide then enter Rentech's reactor, producing long-chain hydrocarbons that are fed into an upgrading unit from UOP to refine into the final product of synthetic diesel or jet fuel.

Alternately, the syngas can be used to produce electricity, specialty waxes, or chemicals.

Today's deal adds a second cleaning step for the syngas using UOP's gas processing technology. The added cleasing removes impurities from syngas and hydrogen-rich streams used within the plant.

Although the deal was formally announced today, Rentech disclosed the step to the Cleantech Group in August when announcing a contract to provide synthetic diesel fuel to ground vehicles at the Los Angeles International Airport (see LAX signs first supply deal for synthetic diesel from Rentech).

Gross said the alliance is not exclusive but takes advantage of the two companies' complementary technologies. UOP, a Des Plaines, Ill.-based unit of Honeywell International (NYSE:HON), is an open-licenser, she said.

The deal isn't UOP's first in the clean fuels space. In September, UOP signed a letter of intent with Wilmington, Del.'s Ensyn to commercialize Ensyn's Rapid Thermal Processing technology, which converts second generation biomass, such as forest and agricultural wastes, to bio-oil, also known as pyrolysis oil, for use in power and heating applications (see Honeywell, Ensyn in biomass venture).

A month later, UOP received a a grant from the U.S. Department of Energy to develop biofeedstock technology to improve the stability of pyrolysis oil from second-generation biomass feedstocks (see UOP gets funding for biomass oil project).

And in 2007, UOP announced an agreement to partner with the University of Southern California to develop and commercialize new technology to transform carbon dioxide into clean-burning alternative fuels (see UOP, USC to develop fuel from carbon dioxide).

"We develop technologies that refiners and fuel or petroleum providers need, and we are looking to put those technologies in any space that needs them," Gross said.

Rentech is currently undergoing feasibility studies for a plant in Rialto, Calif., which is expected consume urban woody waste such as lawn clippings, in addition to sewage sludge supplied by EnerTech Environmental. 

The plant is expected to produce 600 barrels per day of fuel, with the LAX agreement representing up to one-sixth of production; electricity to run the plant; and about 35 megawatts of electricity to export to the grid. Rentech has filed a proposal to sell the electricity to Rosemead, Calif.-based utility Southern California Edison (SCE).

Rentech also plans to build a $4 billion-to-$4.5 billion plant in Natchez, Miss., to produce 560 MW of electricity, as well as about 28,000 barrels of synthetic jet fuel per day. In 2007, the Mississippi Business Finance Corporation approved a tax exemption for bonds up to $2.75 billion for the facility (see Mississippi extending sweet deal to coal-to-fuels plant).

Shares of Rentech were up slightly more than 1 percent to close at $1.63 today.

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