Rivertop Renewables is rolling, rolling, rolling down the river of opportunity— now, moving into water treatment. Why the momentum, and why now?
Rivertop Renewables is proving that there’s a way to beat low-cost oil prices and do well in renewable chemicals: chase phosphate replacement rather than petroleum replacement.
This week, the focus is on chelation — a chemical binding reaction useful in water treatment, and Rivertop Renewables has launched its Waterline-branded corrosion inhibitors and chelating agents, a new family of cost-effective, high performance and sustainable chemicals designed to be integrated with products in the water treatment industry. The new products are high performance, low-cost alternatives to phosphate-based options in water treatment formulations.
What does Waterline do? These chelating agents help control and prevent hard water scale accumulation while Waterline CI corrosion inhibitors offer formulation flexibility as well as superior environmental performance compared to other corrosion inhibitors.
In a larger sense, though, here’s the Rivertop story: watch this space. The pace is picking up, and since Rivertop is not replacing petroleum, the glum looks seen elsewhere in the biofuels and chemicals world are nowhere in sight. So, while elsewhere in the Bioeconomy we are living through scenes from Les Miserables, out of Missoula we are getting a lot more It’s Beginning to Feel a Lot Like Christmas.
Rivertop itself is a Citadel of Silence when it comes to specific applications and deals, but more than one is expected by “informed observers” to break in the next 60 days.
The phosphate problem
“A number of major players have concluded that phosphates are simply not going to be allowed, or will not be considered responsible, going forward,” noted Rivertop CEO Mike Knauf.
And there you have the Rivertop “core strategy” in a nutshell. Peel away customers for phosphates, which started with RIOS, the lead product focused on the dishwashing market.
The Waterline gambit
The replacement of phosphorus and heavy metal based ingredients is an ongoing challenge across multiple industries that use large volumes of process and cooling water in their operations, such as power generation, oil & gas, mining, metals, pulp & paper, and many others. Rivertop’s proprietary sugar acid technology platform offers—for the first time at commercial-scale — a range of versatile organic corrosion and scale inhibitors to help meet this challenge.
Waterline products are produced at commercial-scale in a plant operated by DTI in Danville, Virginia. Rivertop sells direct to water treatment service companies and plans to establish a network of resellers.
“Over time, water can have negative impacts on tanks and pipes,” said Knauf. “By formulating Waterline corrosion inhibitor and chelation chemistries into water treatment products, cooling and process water professionals can better maintain infrastructure and improve the overall performance of facilities – with sustainable ingredients made from renewable sources.”
The Whys and wherefores
Why now? Frankly, the company has been laser-focused on RIOS, its dishwashing ingredient, which is the anchor market. It’s visible to people, attractive to venture and strategic investors. But, inevitably, companies like Rivertop attract a lot of visitor flow, and there’s been a growing wave of demand for chelators.
Why not license? To date, Rivertop has been staffing around its core functionality — outside of the core, discussions have revolved around licensing. But that has more to do with the global footprint needed to market to non-core applications. In this case, the demand was showing up at the plant. And so, the core expands.
Why chelators, why water treatment? The bottom line is that Rivertop can get incremental, strategically interesting sales at the right pricing. That is, prices that reflect the value of the molecule, rather than the kind of “fill the plant” pricing we’ve seen in commodity strategies with “same as” molecules.
Right now, Rivertop is tolling at DTI. Expect an at-scale plant to appear that captures more of the value than you see in a tolling arrangement.
Then, watch this space. If the deal flow starts to add up, proving the market — especially, if these are deals at price points that reflect value instead of commodity “shovel out the product”, someone is going to spot an opportunity to take this company global. There simply isn’t enough bandwidth in a start-up company to handle all the applications in replacing phosphates — especially, the globalized ones.
In that case, think acquisition or IPO. Only when the market is proven. But for sure, consider oil prices a non-factor. And watch this space.
Get the backstory
More on the story at Rivertop Renewables.
See our Rivertop Renewables 2015 5-Minute Guide for a concise backgrounder on the company.