From left: Verdezyne Inc CFO Brian Conn, President & CEO Dr William Radany, chairman Chad Waite, and board member Drew Senyei at Hatter's Castle, Carey Island, Selangor, after a press conference on April 29. AZLINA BT ABDULLAH/THE STAR
KLANG: Verdezyne Inc is set to build its first large-scale plant to begin commercial production of “green” dodecanedioic acid (DDDA), a raw material used to produce nylon and resins for everyday use, from plant-based oils in Malaysia.
The US-based industrial biotechnology company is currently evaluating several potential sites, ranging from an industrial park in Johor to Lahad Datu in Sabah, for the building of the plant that is expected to take at least 18 months to complete.
“We have hired an engineering firm that is working on all the details of the plant (including the total investment required),” Verdezyne chief financial officer Brian Conn told at a press conference at Carey Island.
“We expect the plant to potentially serve up to 30% of the global market requirement for DDDA,” Conn added.
According to Verdezyne, the global market for DDDA, which is currently produced mainly from petroleum-based feedstock, alone is valued at US$200mil (RM651.7mil) per year. It has been growing at an annual rate of 5.4%.
Verdezyne had on Monday signed a memorandum of understanding with Sime Darby Bhd, under which the Malaysian conglomerate was expected to take up a 30% stake in Verdezyne for US$30mil (RM97.75mil).
The acquisition would effectively make Sime Darby the single-largest shareholder in Verdezyne.
An officer from Sime Darby said the group regarded its investment in Verdezyne as an opportunity to create a new revenue stream.
“What Verdezyne does is very complementary to our business,” he said.
“We envision a long-term relationship that will allow us to leverage on all the feedstocks within Sime Darby’s palm oil value chain to produce a whole variety of different chemicals that we’re currently working on,” Verdezyne president and CEO William Radany said.
Verdezyne, which now only has a pilot plant in San Diego, United States, has propriety technologies to produce chemicals from sustainable materials that can be found in the oil palm value chain.
The “green” chemicals such as DDDA developed by Verdezyne can be used in the manufacturing of everyday items, including clothing, footwear, adhesives and automobile lubricants, to substitute petrochemicals produced from depleting fossil-fuel feedstocks.
Verdezyne’s current products targeted for commercialisation have a potential combined market size of about RM37bil.
Other significant investors in Verdezyne are BP Alternative Energy, global life sciences group Royal DSM, OVP Venture Partners and Monitor Ventures.