KBR's Technology Business Featured in Houston Chronicle

KBR works to ramp up non-food biofuel output
Houston could reap benefits if it is successful
August 9, 2009
By Brett Clanton
Copyright 2009 Houston Chronicle

When it comes to production of corn-based ethanol, Houston will never be Iowa. But the nation's energy capital could have a role to play in moving the alternative fuel beyond corn and into a next wave of innovation.

At an office park in west Houston, it's already happening. That's where KBR, the engineering and construction giant, owns a technology center that has been quietly evaluating emerging biofuels technologies to see if they can work in a large-scale plant as well as they do in the laboratory.

Such analysis has become especially valuable in the wake of a 2007 energy law that in coming years requires blending not only of corn ethanol but renewable fuels made from non-food sources into the nation's fuel supply.

Recently, biofuels companies have risen to the challenge, developing methods for making fuel from junk crops like switchgrass, agricultural byproducts like wood chips and even municipal solid waste. But technical and cost hurdles, along with the recession, have delayed some projects.

"The key to biofuels is the scale-up. That's the Achilles' heel of this whole thing," said Jean-Pierre Jacks, KBR's director of American sales at the company's downstream division, during a recent visit to the firm's tech center.

But that's precisely where KBR and other parts of Houston's oil and gas industry may be able to help, said Peter Kipp, a biofuels consultant with Haisley Millar who serves on a biofuels task force at the Greater Houston Partnership.

"The Houston area offers as compelling a set of advantages as any other city in terms of the knowledge base that's here, the distribution infrastructure for fuels and the project management expertise," he said. "Houston should be the prime location for commercialization for these next-generation fuels."

The Energy Independence and Security Act of 2007 calls for the supply of renewable fuels to grow to 36 billion gallons by 2022, up from 11.1 billion gallons this year. Conventional biofuels like corn ethanol can account for a maximum of 15 billion gallons; much of the rest will be next-generation, also called cellulosic, fuels.

But there are doubts the industry is ready to meet the cellulosic fuel production targets, which call for 100 million gallons beginning in 2010 and ramp up over the following 12 years.

"There are dozens of companies, if not more, that can produce cellulosic ethanol in a lab," said Nathan Schock, spokesman for Poet, the nation's largest ethanol producer. "The challenge for everybody is to do it at a scale that is economically viable."

The Sioux Falls, S.D.-based firm is building a 25-million-gallon plant that converts corn cobs to ethanol in Emmetsburg, Iowa.

But several other announced projects have stalled, and plenty of others have not made it that far.

"If the economics aren't there, the economics aren't there," said Richard Heo, director of business development for KBR's technology division.

KBR, perhaps best known for its sometimes controversial work providing logistics support for the U.S. military in the Middle East, has recently seen more business from biofuels projects.

Those include constructing a 27-million-gallon-per-year corn ethanol plant in Cedar Rapids, Iowa, for agricultural giant Archer Daniels Midland Co., and providing engineering support for five cellulosic ethanol projects, which KBR officials declined to name.

The company, through a newly formed ventures unit, has considered taking an equity stake in biofuels projects, but wants to make sure the technology is sound first, Jacks said.

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