It’s in your car tires and the roads you drive on. It bonds the wood particles in your desk. It coats the apples and fancy cheeses you eat for lunch. Wear lipstick? It’s in that, too. It’s also scribbled in the pages of your child’s colouring book and helps set a romantic tone for dinner when that same child is visiting grandma.
From crayons to candles, wax is everywhere, but few of us realize how much it touches our daily lives. “The global market for wax is almost $10 billion, so that’s nothing to sneeze at,” says David Harris Kolada, vice-president of alliances and market development at Sustainable Development Technology Canada (SDTC), which supports the commercialization of Canadian clean technologies.
But there is a problem: the amount of waxes made as a by-product of petroleum refining is falling. Refiners, required by regulation to reduce the amount of sulphur in their product, have changed their processes.
The result is that the percentage of waxes they produce from a barrel of crude oil is steadily declining. At the same time, rising petroleum prices means volatile wax prices.
A bag of shredded plastic is used as feedstock in the GreenMantra Technologies process. Photo credit: David Dodge
Historically, petroleum-based waxes represented more than 90 percent of the global market supply. It now sits below 73 percent, according to industry consulting firm Kline & Company. “With anticipated strong demand growth and relatively weak supply growth, the global wax market is expected to experience an increasing shortage,” the company wrote in a 2013 research report on the wax industry. “The global wax deficit is projected to grow to almost 850 million pounds by 2022.”
That economic reality — and opportunity — is partly what attracted Harris Kolada’s team at SDTC to synthetic wax producer GreenMantra Technologies of Brantford, Ont. “The supply-demand metrics are clearly in their favour,” Harris Kolada says. In June, SDTC announced a $2 million investment in the company, which has developed a relatively inexpensive way of converting low-value plastic waste into any commercial grade of wax desired by a customer.
GreenMantra’s core innovation is a catalyst that guides the depolymerization process, which uses heat and pressure to break down long chain plastic polymers (containing more than 1,000 carbon atoms) into shorter-chain waxes (containing 25 to 30 carbon atoms). GreenMantra’s CEO Tim Haig says that using heat to depolymerize plastics is nothing new. “Anybody can break down plastics into crude oil or lubricants,” Haig says. Knowing when to stop the process is the trickier part. Overshoot it and you end up with carbon soup — a mix of different carbon chains that have to be further separated at extra cost and result in products that you may not want.
GreenMantra Technologies is looking to scale up this Brantford, Ont. pilot plant to a full-scale commercial one in mid-2015. Photo credit: GreenMantra Technologies
Haig says GreenMantra’s market differentiation is that it can selectively depolymerize plastics through a highly tunable catalytic process. “It’s a combination of time, temperature and the amount of contact the catalyst has with the plastics.” According to GreenMantra’s patent, polyethylene waste is shredded and pre-heated in an extruder to create a liquid that is pushed into a high-pressure reactor. The company’s catalyst is then introduced into the reactor and mixed with the molten plastic using a stirring blade. When the desired pressure and temperature is reached, the heat is turned off and the liquid wax is drained, filtered and purified as required.
Not all wax is created equal and this goes far beyond niche waxes coming from bees and plants. Waxes can have different melting points (45 C to 130 C) and they can vaporize at different temperatures (180 C to 350 C). Hardness, purity, colour and odour can vary and this determines market price. For example, so-called “slack waxes” are the lowest value waxes because they are soft, smelly and have colour. They are used in making fire logs, pavement and roof shingles. When making slack waxes, it’s acceptable to have some level of impurities and this means a mix of plastic waste can be used.
The harder, clearer and more odourless the wax produced the higher value it is. The plastic waste that feeds the process must also be more consistent and cleaner. Waxes that come into contact with food, for example, are considered premium products.
GreenMantra is unique in that, by adjusting temperature, pressure and length of time in its reactor, it can produce exactly what the customer needs using a specified plastic waste stream. An added bonus is that the process uses less energy than competing approaches, putting another environmental feather in the company’s cap.
It’s this kind of flexibility that has helped GreenMantra attract investors, such as Toronto-based ArcTern Ventures, which was spun out of the MaRS Discovery District. Murray McCaig, a managing partner at ArcTern and now a director on GreenMantra’s board, says the past two years have been spent backing up the company’s technology claim. “We had to run thousands of batches to understand that when the plastic is X, here are the conditions you need to set on the equipment to deliver wax Y,” McCaig says. “That’s the intellectual property of the company.”
Both McCaig and Haig declined to comment on GreenMantra’s catalyst, which was developed by company founder Pushkar Kumar and his chemical engineer father, Anil Kumar. What began as experimentation in a garage in India soon grew into a Canadian business that, as McCaig describes it, has the potential to completely change the industry. According to GreenMantra’s patent, “the catalyst is prepared by binding a ferrous-copper complex to an alumina support and reacting it with heteropolyacid to obtain the final catalyst.” Beyond that, “it’s top secret,” says McCaig.
What we do know is that the catalyst can be created in large quantities in an economical way. It can also be used in the process for a long time before having to be swapped out with a new catalyst. And the old catalyst can be regenerated and fed back into the process.
In addition to the catalyst itself, it’s the type of processing plant that the catalyst enables that has McCaig and others excited. Typically, one would have to spend more than $100 million and potentially billions of dollars to build a plant that produces waxes from petroleum or synthetic gas. The latter is what South Africa-based Sasol, the world-leading producer of synthetic wax, uses in its Fischer-Tropsch plants.
GreenMantra’s systems are modular, meaning the company can build plants for less than $1 million and expand from there. Think about that: for the past 100 years most wax has come from large, centralized, multibillion-dollar petroleum facilities and what they produce is what you get — there’s little ability to fine-tune the characteristics without sending the wax to secondary processing facilities at additional cost. “Now,” says McCaig, “you can go to a customer and say, ‘We’ll build a plant right on your site, use local materials and give you exactly the specs you need.’ And if they need us to change the formula, we can do that.”
That’s a powerful proposition and may explain how GreenMantra was able to lure Paul Veillette, the CEO of Sasol Wax Americas, to its management team. When GreenMantra announced Veillette as its new vice-president of sales, the executive called the company’s technology a “compelling value proposition” and “distinct” in the industrial chemical world. “I strongly believe that GreenMantra’s technology will rapidly alter the wax industry landscape,” Veillette said in a statement.
But it’s not just customers that stand to benefit. For Stewardship Ontario, an industry recycling consortium, GreenMantra’s approach could go far in helping to divert more plastics from landfills. As the industry consortium puts it, “By making polymers from polymers, GreenMantra is successfully keeping the molecules in play.”
In Ontario, for example, more than 235,000 tonnes of plastic waste is generated annually but only a quarter of that is recovered through the province’s Blue Box recycling program. Plastic beverage bottles are easily recycled, but Type 2 plastics, such as milk jugs and food containers and Type 4 plastics, such as plastic bags and films used in packaging, pose a challenge for most municipalities. About half of Type 2 plastics end up in a landfill, while Type 4 plastics have only a 10 percent diversion rate. That GreenMantra’s process has no problem accepting plastic bags and other less-desired plastics is why Stewardship Ontario invested in the company and is helping it to expand the output of its Brantford pilot plant.
The company, for example, has made wax from Vancouver’s Blue Box program that, in turn, has been used in asphalt for the city’s roads. It’s that kind of closed-loop local recycling system Stewardship Ontario hopes to see spread across the rest of Canada.
With the technology more or less proven, the focus for GreenMantra is now on growth. “We currently produce one to two truckloads of wax per month,” says Kumar, adding that plans are underway to raise more capital for a full-scale commercial plant. “We estimate our commercial facility will be online by mid-next year.”
Finding that capital is what Haig, working in an interim role as CEO, has been focused on for the past year. A seasoned clean technology executive, Haig founded and ran biodiesel company BIOX Corp. and is a previous chairman of the Canadian Renewable Fuels Association. He’s actively involved in discussions with potential investors and says to expect a major funding announcement by this fall. “We’ve now got a strong pipeline of companies that have tested our material and if we can make the kinds of quantities they need, they’ll buy,” Haig says. “So now, it’s just about our ability to fund scale-up.”
Helping Haig has been Harris Kolada at SDTC, which in addition to funding companies also works with them to achieve sustainable commercial operations. SDTC’s interest in GreenMantra stems from the potential it has to boost Canadian technology exports. “Our companies are built to export, that’s absolutely the intent,” Harris Kolada says. “We expect there will be a significant amount of GreenMantra’s revenues derived from international sales.”
According to research firm Global Industry Analysts (GIA), the fastest growing market for wax products will be in the Asia-Pacific region, which will experience a compound average growth rate of 6.8 percent between now and 2020. The largest market, however, will remain the United States. Growth there will be driven by the economic recovery, but also because of “new emerging applications in packaging, candles, personal care products and coatings,” states GIA in a research report released this past July. “Limited (US) production makes the country reliant on imports for meeting domestic demand.”
With a nearly endless supply of waste plastics literally at its disposal, GreenMantra appears ready to dive in. “I think we’re going to do well as an investor,” says McCaig. In the process, “we’re going to create a large Canadian business and create lots of jobs.” And that’s something to wax poetic about.