Carbon-negative plastics: a breakthrough?

This short note describes a potential, albeit early-stage, breakthrough converting waste CO2 into polyethylene, based on a recent TOTAL patent. We estimate the process could sequester 0.8T of net CO2 per ton of polyethylene. This matters as the world consumes c140MTpa of PE, 30% of the global plastics market, whose cracking and polymerisation emits 1.6T of CO2 per ton of polyethylene.

An exciting array of companies is aiming to convert waste CO2 into materials, as part of the energy transition. We have profiled 27 leading examples in our screen, which is linked here, updated in June-2020. In the past year, we added three new companies to the list. Three companies reached full technical readiness and moved into commercialisation. The pace of progress has been strong. The companies are ranked by sector below.

The most advanced end market for CO2 is in the curing process for cement, a 4bn ton per annum industry, which accounts for 4bn tons per annum of global CO2 (8% of the total). We recently profiled Solidia’s CO2-curing process, which may eliminate 60% of the net CO2, at a c5% lower cost, and could scale up to displace 300MTpa of CO2 globally (below).

Plastics are the second largest opportunity, with 460MTpa of plastic products consumed globally. Aramco and Repsol are already commercialising polyols and polyurethanes derived from CO2, but these are only c7% of total plastics demand. The largest plastic product is polyethylene, at 140MTpa, or 30% of the total plastic market (chart below, data here). Chevron and Novomer also have technologies turning CO2 into carboxylates and acrylates, but again, these are smaller markets.

Hence, one of TOTAL’s 2019 patents stood out to us, as we reviewed 3,000 of the largest Energy Majors’ patents from last year. TOTAL has patented a group of boron-doped copper catalysts for electro-reducing CO2 into C2s, such as ethylene, which is the chemical precursor to polyethylene [1].

The process has a Faradaic efficiency of 80%. It yields two-thirds ethylene, one-third ethanol, and <0.1% C1s. This is a major advance. Pre-existing technologies are described, which have exhibited low selectivity (6-43% C1), low stability (a few hours), low activity and much lower efficiencies (27-39%).

Specifically, boron comprises 4-7% of the catalyst’s molar mass. Chemically, it draws in electrons from adjacent Cu atoms, inducing a positive charge, which lowers the activation energy for carbon-carbon bonds to form. “The invention is remarkable in that it describes the first tunable and stable Cu+ based catalyst”, the patent states.

Stability remains to be proven, and has only been shown to reach c40-hours in the trials described in TOTAL’s patent. This remains an obstacle for commercialisation, and we score the technology’s readiness as Level 5.

Nevertheless, it is interesting to ask “what if”. We estimate that each ton of ethylene produced from CO2 could sequester a net 0.8 tons of CO2 if the process is powered by natural gas (and 2.5T of CO2 if the process is powered by renewables).

An additional 1.6T of CO2 emissions would also be saved, because this is the typical emissions intensity of conventional production methods for cracking ethane and polymerising ethylene (chart below, data here).

TOTAL’s library of speciality chemicals patents is formidable, based on our review of patents around the energy industry, and as outlined in our recent research.

Last year, we profiled another TOTAL patent, using chromium-based catalysts to reduce defects and increase the strength of recycled plastic products (chart below, note here).

We remain excited by the pace of progress in next-generation plastic recycling, turning waste plastic back into oil. TOTAL also screens among the leaders in this area, via a new partnership with Recyling Technologies. Our screen of companies in this space was also recently updated and is linked here.

[1] Che, F., De Luna, P., Sargent, E. & Zhou, Y. (2019). Boron-Doped Copper Catalysts For Efficient Conversion Of Co2 To Multi-Carbon Hydrocarbons And Associated Methods. TOTAL Patent WO2019206882A1

Turn the Plastic into Roads?

The opportunity is emerging to absorb mixed plastic waste, displacing bitumen from road asphalts. We find strong economics, with net margins of $200/ton of plastic, deflating the materials costs of roads by c4%. The challenge is scaling the opportunity beyond 20MTpa, as unrecycled waste plastics surpass 320MTpa. Leading companies include Dow (US, public) and MacRebur (UK, private). Full details are covered in our new 6-page note.

Pages 2-3 outline the confluence between the road-building indsutry and the plastic waste problem, covering market sizes and costs.

Page 4 is a table of 15 projects we have screened so far, mainly from 2019-20, using modified mixed plastic waste as a road-binder, including key facts and stats.

Page 5 outlines the economics, by analogy to our recent resarch into plastic pyrolysis (and still extremely exciting) and for road-building more broadly.

Page 6 addresses the challenge of scalability, using data and estimates for the percent of mixed plastic going into road materials.

Patent Leaders in Energy

Technology leadership is crucial in energy. It drives costs, returns and future resiliency. Hence, we have reviewed 3,000 recent patent filings, across the 25 largest energy companies, in order to quantify our “Top Ten” patent leaders in energy.

This 34-page note ranks the industry’s “Top 10 technology-leaders”: in upstream, offshore, deep-water, shale, LNG, gas-marketing, downstream, chemicals, digital and renewables.

For each topic, we profile the leading company, its edge and the proximity of the competition.

Companies covered by the analysis include Aramco, BP, Chevron, Conoco, Devon, Eni, EOG, Equinor, ExxonMobil, Occidental, Petrobras, Repsol, Shell, Suncor and TOTAL.

Upstream technology leaders have been discussed in greater depth in our April-2020 update, linked here.

More information? Please do not hesitate to contact us, if you would like more information about accessing this document, or taking out a TSE subscription.

Turn the Plastic Back into Oil

Due to the limitations of mechanical recycling, 85% of the world’s plastic is incinerated, dumped into landfill, or worst of all, ends up in the oceans. An alternative, plastic pyrolysis, is on the cusp of commercialisation. We have assessed twenty technology solutions. Excitingly, this nascent opportunity can turn plastic back into oil, generate >30% IRRs on investment, and could displace 15Mbpd of future oil demand.

These are the conclusions of our new, 16-page report…

We have diligenced 20 companies (above), operating 100 pyrolysis facilities globally. Our work included two site-visits and multiple patent reviews. Three early-stage companies hold particular promise. You can download our technology-screen here.

Larger companies (BASF, OMV, BP, TOTAL and Exxon) are also waiting in the wings, to scale up in this space. Their own patents and progress are reviewed in the note.

Economics will be strong, and should surpass 30% in our base case, modelled here. With another c25% deflation, it could become economical to deploy the technology in removing plastic from the ocean.

9Mbpd of oil and condensate are currently consumed for chemicals, as broken down here. Even as plastic demand trebles by 2050, plastic-recycling could eliminate any net demand growth for oil; or even halve it, as modelled here.