Novomer’s carbon monoxide technology will be significantly lower cost than the competing processes used today to make acrylic acid, butanediol, and succinic acid. The cost advantage can be attributed to the following:
- The price of ethylene oxide – one of Novomer’s raw materials – is expected to remain very low because of abundant ethane supplies in many parts of the world. For example, large amounts of ethane exist in Canada, the Middle East, and in US shale gas (more details below). Additionally, low cost ethane from shale is possible in Europe, Asia, and other parts of the world when extraction technologies mature.
- Novomer's catalyst is 99.9% selective and does not form any byproducts
- Target molecules are composed of 40-60% carbon monoxide which is a relatively low cost feedstock
Shale gas does not benefit all petrochemical producers, but will provide Novomer with a sustainable competitive advantage. Most chemical feedstock costs are linked to the price of crude oil, which can vary widely with political instability, market speculation and world demand. The potential to use shale gas enables Novomer's cost structure to be decoupled from the price of crude oil and allow for production of lower cost chemicals compared to those sold today