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.
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.