BioAmber signs take-or-pay contract for three bio-succinic acid plants
Vinmar commitment is for 210,000 tons of succinic acid per year when three plants operational.
MINNEAPOLIS, Minn. — BioAmber Inc. has signed a 210,000 ton per year take-or-pay contract for bio-based succinic acid with Vinmar International.
Under the terms of the 15-year master off-take agreement, Vinmar has committed to purchase 10,000 tons of succinic acid per year from BioAmber’s 30,000 ton per year capacity plant under construction in Sarnia, Ont.
BioAmber and Vinmar have also broadened the scope of their previously announced 100,000 ton per year 1,4 butanediol (BDO) plant, which is planned to start up in late 2017. Under that agreement, following the financing, construction and commissioning of the BDO plant, Vinmar has committed to purchase has committed to sell 100% of the BDO produced for 15 years.
As part of the new succinic acid master off-take agreement, the second plant will be expanded to an annual capacity of 100,000 tons of bio-BDO and 70,000 tons of bio-succinic acid. Vinmar plans to make a 10% or greater equity investment in the expanded plant and has committed to off-take and BioAmber has committed to sell a minimum of 50,000 tons per year of bio-succinic acid for 15 years. Vinmar also has the option to secure additional bio-succinic acid tonnage under the take-or-pay contract if BioAmber has not committed the remaining volume at the time the plant’s financing is secured.
Vinmar also committed to off-take and BioAmber committed to sell a minimum of 150,000 tons per year from a new, third plant following its financing, construction and commissioning. The plant would be dedicated to bio-succinic acid production and would have an annual capacity of 200,000 tons per year, which BioAmber expects to start up in late 2020.
BioAmber, an industrial biotechnology company that produces sustainable chemicals, has signed 19 supply and distribution agreements and seven memorandum of understanding to date. The cumulative volume of these contracts exceeds the available capacity for sale in Sarnia. The company has been selling bio-based succinic acid for over four years and to date 38 customers have qualified the company as a supplier and purchased product from the existing production facility in France.
“This multi-plant deal is a quantum leap forward for our succinic acid business and sets a clear path for rapid growth,” said Jean-Francois Huc, BioAmber’s CEO.
Vinmar International is a marketer and distributor of chemicals with sales of over $4 billion per year and annual volumes that exceed 3 million tons.