PureCycle announces Formerra partnership, facility updates

Plastics recycler PureCycle Technologies Inc., Orlando, has announced that it will partner with Romeoville, Illinois-based engineered materials distributor Formerra, allowing Formerra to serve as the primary authorized North American distributor of PureCycle’s recycled polypropylene (PP) resin, called PureFive.

PureCycle says its resin is made using a patented process designed to transform PP scrap (designated as No. 5 plastic) into a continuously renewable resource. The company’s purification technology removes odor, color and other impurities from PP scrap, resulting in a recycled plastic that can be recycled and reused.

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The company says its resin is a like-virgin material, easily colorable and is not only 100 percent recyclable but also projected to use around 79 percent less energy than virgin resin. The company also projects it to release 35 percent fewer carbon emissions than new PP manufacturing.

“This is another key step in executing our global growth strategy,” PureCycle CEO Dustin Olson says. “Formerra’s commitment to innovative approaches to complex end-market applications and strong dedication to sustainable solution-building is a perfect fit for our company. Our first purification line in Ironton, Ohio, scheduled to be completed shortly, and the subsequent two lines planned in Augusta, Georgia, are designed to produce more than 300 million pounds of UPR resin. We will rely on Formerra as a trusted distribution partner to help us reach new markets.”

PureCycle says it expects its resin to be available to Formerra customers by as early as the fourth quarter of this year.

Formerra CEO Cathy Dodd adds, “Addressing the world’s most pressing sustainability challenges is a responsibility we all share. We are excited to bring PureCycle resin to our expansive materials lineup because this material aligns with our strengths—ingenuity, technical expertise and sustainable growth. Our customers will now have a game-changing solution to help them meet their environmental sustainability goals. In addition, our experienced technical team will be able to work with PureCycle to customize the material to meet specific customer needs.”

As part of its fourth quarter 2022 update, PureCycle says its Ironton facility is nearly mechanically complete, with the final systems expected to be complete in April. The company adds that the purification facility is expected to be in position for commercial production of UPR resin by the end of that month.

In a news release detailing its fourth quarter of 2022, the company adds that there was a delay in the facility’s startup commissioning timeline that was caused primarily by engineering rework, extruder component deliveries and extruder electric equipment being damaged during commissioning. It says that subsequent to year-end and following its inability to complete all construction activities by Dec. 1, 2022, the company and Ironton bondholders agreed to a limited waiver to the original indenture agreement that principally adjusts certain operational milestones and transfer of funds for specified purposes.

“We are pleased to have reached a mutually agreeable resolution with our bondholders on a limited waiver,” PureCycle Chief Financial Officer Larry Somma says. “Equally important, we secured a $150 million revolving line of credit to be available for general working capital purposes. We are also in various stages related to additional capital raises in order to further strengthen our balance sheet.

“As we have noted previously, our goal is to maintain financial flexibility and optionality with the capital we raise prior to Ironton being fully operational,” he continues. “The interest in our mission is very strong and once Ironton is operational, we will endeavor to raise the capital necessary to fund phase one of our Augusta project at an attractive cost of capital for the benefit of all stakeholders.”

The company says engineering and preconstruction activities at its planned multi-line purification facility in Augusta continue to move forward. As of year-end, PureCycle has committed or spent $185.7 million on long-lead equipment for the first phase of the project.

On Jan. 17 of this year, PureCycle and the Port of Antwerp-Burges announced its first European PP recycling facility in the port’s NextGen District, located in Belgium. Initially, the site will have one purification line with an annual nameplate capacity of 130 million pounds, with the potential to expand up to four purification lines with a nameplate capacity of 520 million pounds. In its fourth quarter 2022 news release, the company says it anticipates construction activities to begin in the first half of 2024, with production ramping up in the first half of 2026.

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Additionally, PureCycle has signed a heads of agreement with Mitsui, a nonbinding agreement that outlines the general terms of an expected joint venture agreement. They have identified two potential sites to develop a multiline purification facility. The company says its joint venture team with South Korea-based SK Geo Centric continues to make progress in finalizing the feedstock engineering, project budget and financing strategy.