MOSCOW (MRC) -- PureCycle Technologies Inc.'s flagship polypropylene recycling facility in Ironton, Ohio, is "days away" from beginning the start-up phase of commercial pellet production, according to CEO Dustin Olson, said Sustainableplastics.
"As part of our mission to create an 'infinitely sustainable planet,' we are focused on the health and safety of PureCycle team members and the communities in which we operate," Olson said in a May 9 news release. "With that in mind, we are excited to begin safely ramping up commercial operations and the production of UPR [ultra-pure recycled] resin in our state-of-the-art purification facility in Ironton."
Orlando, Fla.-based PureCycle experienced a series of delays on the much-anticipated Ironton plant, which is expected to create 80-100 jobs and could end up costing as much as $361 million. Now, the first delivery of solvent needed for the firm's recycling process has been received. PureCycle next will make pellets from virgin PP resin and then will add post-industrial and post-consumer PP into the purification process to make recycled resin pellets for sale and distribution to customers.
PureCycle's ramp-up strategy is to gradually increase plant capacity utilization, officials said, while scaling in higher volumes of feedstock deliveries and customer offtake shipments.
PP has been held up as the next big market for plastics recycling, but the needle hasn't moved that much even as recyclers talk about its potential. Just a small amount of PP currently is recycled in the U.S., with estimates typically in the low single digits. By comparison, both PET and high density polyethylene have recycling rates of just under 30 percent.
PureCycle's Ironton plant can handle almost 110 million pounds of PP per year using a solvent-based technology originally developed by consumer products giant Procter & Gamble Co. The technology essentially washes away contaminants, colors and odors to create a virgin-like resin.
PureCycle also recently secured $62 million of debt financing to strengthen its balance sheet. That amount includes a $40 million term loan with an entity controlled by Dan Gibson, chief investment officer of Sylebra Capital, PureCycle's largest shareholder. It also includes equipment financing for up to USD22 million for a planned recycling plant in Augusta, Ga.
PureCycle Chief Financial Officer Larry Somma said in the release that the firm's strategy remains to obtain long-term project financing for the Augusta plant once the Ironton plant is operational.
"We believe that having capital that can 'bridge' the Augusta project until Ironton is operational will allow [PureCycle] to access a longer-term, lower-cost source of funds," he said.
Officials said that site engineering work is progressing in Augusta and that PureCycle has submitted a finance plan to the Development Authority of Augusta for a purification line. They added that the firm is working to close on land rights for the project by June 30. Module preparation for construction also has begun for a proposed plant Beaumont, Texas.
Internationally, PureCycle in Belgium has begun site engineering work at the Port of Antwerp to start the permitting process. The firm's joint venture team in South Korea has "continued to progress" on engineering plans, while in Japan, PureCycle has continued potential JV discussions with industrial firm Mitsui & Co. while starting the feasibility study process on potential sites in Japan.
PureCycle posted a loss of USD25.8 million in the first quarter of 2023 after losing USD25.4 million in the same quarter in 2022. For full-year 2022, the firm lost almost USD85 million.
On Wall Street, PureCycle's per-share stock price closed near USD7.40 on May 9, up more than 17 percent so far in 2023.
We remind, around 3.33 million tonnes of plastic waste were recycled or reused as raw materials in Germany in 2019.
More than 38 per cent of this was polypropylene (PP). Yet recycling this PP comes with its own set of problems, caused by the fact that due to the sometimes very long polymer chains, the melt flow index of PP derived from the mechanical pre-sorting of various material streams is often too low to allow for further processing via either injection moulding or extrusion.