Ludwigshafen, Germany-based BASF plans to invest 20 million euros ($22 million) into Oslo, Norway-based Quantafuel, a specialist for pyrolysis of mixed plastic scrap and purification of pyrolysis oil. The investment will be facilitated by the subscription of new shares and the grant of a convertible loan, according to a news release from BASF.
The partners aim to further develop Quantafuel’s technology for chemical recycling, consisting of an integrated process of pyrolysis and purification, towards optimizing the output for the use as feedstock in chemical production. In a second step, Quantafuel also plans to license the jointly developed technology to other parties.
Quantafuel plans to start a pyrolysis and purification plant with a capacity of approximately 16,000 tons per year in Skive, Denmark in the fourth quarter of 2019. As part of the investment agreement, for a minimum of four years after the start of production at Quantafuel’s Skive plant, BASF will have a right of first refusal to all pyrolysis oil and purified hydrocarbons from this plant.
BASF says it will use the secondary raw materials in its ChemCycling project to develop the market for chemically recycled plastics with selected customers. Once the Quantafuel plant in Denmark reaches full capacity, BASF aims to deliver first commercial supply volumes of ChemRecycling products to selected customers. To increase commercial offerings, the partners aim to build jointly owned plants to produce purified hydrocarbons through chemical recycling.
“The investment underlines BASF’s commitment towards a sustainable use of resources and the development of a circular economy model for plastics,” says Hartwig Michels, president of petrochemicals at BASF. “The partnership is a first step to build up a broad supply base for Ccycled products. This enables us to support our customers in achieving their sustainability targets.”
Kjetil Bøhn, CEO of Quantafuel, says, “We are of course honored that BASF has decided to invest both financial and human resources in our quest to become the leading technology company for recycling of a broad spectrum of mixed plastic waste based on our unique purification step.”
He adds, “Our longstanding strategic partner Vitol, the world’s largest independent energy trader, has agreed to open our existing cooperation to enable the collaboration between BASF and Quantafuel. We now have the foundation to establish production capacity on a scale that could have a meaningful impact on the global environmental challenges with waste plastic.”
To fully develop the market for chemically recycled products, besides technological challenges, regulatory issues will need to be resolved, BASF says.
“On the regulatory side, authorities need to more broadly establish an open definition of recycling, allowing that the use of chemical recycling processes can count towards recycling targets,” Michels says. “In addition, incentives for recycled content should apply equally to all types of recycling and we also need full acceptance of mass balance approaches.”