Germany-headed global chemicals major BASF SE (BASF) will invest EUR 20 million in Quantafuel AS, a Norwegian specialist for pyrolysis of mixed plastic waste and purification of pyrolysis oil. The investment will be facilitated via the subscription of new shares and via the grant of a convertible loan. It also gives BASF the right of first refusal for chemically recycled pyrolysis oil and purified hydrocarbons from Quantafuel’s plant currently under construction in Skive, Denmark.
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According to a statement, together, 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 up a pyrolysis and purification plant with a nameplate capacity of approximately 16 000 tonnes per annum in Skive, Denmark in the fourth quarter of 2019.
As part of the investment agreement, BASF will have a right of first refusal to all pyrolysis oil and purified hydrocarbons from the Skive plant for a minimum of four years after the start-up of production by Quantafuel.
We are of course honoured that BASF has decided to invest both financial and human resources in our quest to become the leading technology company for recycling a broad spectrum of mixed plastic waste based on our unique purification step. Our longstanding strategic partner Vitol S.A, 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, said Kjetil Bøhn, CEO of Quantafuel.
ChemCycling to produce Ccycled products
BASF will use these secondary raw materials in its “ChemCycling” project to develop the market for chemically recycled plastics with selected customers.
At BASF’s Ludwigshafen site in Germany, the recycled raw materials will be fed into the production cycle, thereby partially replacing fossil resources.
Once the Quantafuel plant in Denmark reaches full capacity, BASF aims to deliver the first commercial supply volumes of “Ccycled” products, meaning products based on chemically recycled plastic waste, to selected customers.
To increase commercial offers, the parties furthermore aim to build jointly owned plants to produce purified hydrocarbons via chemical recycling.
The investment underlines BASF’s commitment towards sustainable use of resources and the development of a circular economy model for plastics. Moreover, 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, said Hartwig Michels, President Petrochemicals, BASF.
BASF started its ChemCycling project in 2018 with the aim to process recycled raw materials obtained from plastic waste in its production Verbund.
Together with customers from various industries, BASF has already produced first prototypes based on chemically recycled plastic waste – including food packaging for which particularly high quality and hygiene standards apply.
Regulatory issues
The share of recycled raw material is allocated to the final product by using a certified mass balance approach.
To fully develop the market for chemically recycled products, besides technological challenges, regulatory issues will need to be resolved.
On the regulatory side, authorities need to more broadly establish a technology-open definition of recycling, allowing that the use of chemical recycling processes can count towards recycling targets. In addition, incentives for recycled content should apply equally to all types of recycling and we also need the full acceptance of mass balance approaches, said Hartwig Michels.
