Tire Recycling Plant Opens

Carbolytic Materials Co. L.L.C. has announced that its tire recycling plant in Maryville, Missouri has opened. The plant recycles tire scrap to produce a carbon black alternative called ApexCM™ that the company says is suitable for commercial use as a lower-cost, carbon black replacement in applications such as hoses, gaskets, belting, roofing materials, and plastic piping, among other products.

This blog previously wrote about the Carbolytic Materials plant here.

In October 2008, the company received $12.4 million in financing from the Missouri New Markets Development program, which enabled the company to build the new manufacturing facility in rural Missouri. The plant employs 30.

The plant has a capacity of more than 15,000 tons of used tires annually. According to the company, each ton of carbon black replacement it produces represents 380 recycled tires, 760 gallons of oil saved and 3,800 pounds of carbon dioxide emissions kept out of the atmosphere.

Here is the press release.

CBp Carbon Responds to Statement

It’s a case of dueling press releases as a European tire recycler, CBp Carbon Industries, trades charges with one of its founding members.

On August 9, 2009, John Fader issued a press release to announce that he had filed a writ (ref. 209/146172) in the Commercial Court in Hasselt, Belgium to enforce termination of his relationship with CBp Carbon Industries, Inc., a company he co-founded in 2005 with John T. Novak, a stock investor promoter from Vancouver, Canada; Athens, Greece; and Bratislava, Slovakia. In the release, Mr. Fader asserted that he had formally resigned from both the company and its board in March, 2009, but the company continued to promote him on its website as a Director and as Executive VP of Technology. Mr. Fader’s writ alleges, among other things, “breach of trust” and the “unlawful use of Petitioner’s name and reputation.” The dispute involves CBp’s decision to shut down a pilot plant based on Mr. Fader’s technology in Hungary and move the equipment to a new commercial plant in Cyprus. The press release quotes Mr. Fader as follows: “I resigned from my company because of what I considered to be gross mismanagement of the business by its President John Novak, and a disturbing lack of proper corporate governance and transparency; and, because after four years, selection by the EU, and shareholder investment of approximately USD $60 million, my proven technology has still not yet been successfully commercialized.”

The press release further asserts that Mr. Fader’s resignation from CBp Carbon Industries Inc. follows the resignation in January, 2009, of the company’s US General Counsel who had earlier resigned from the board, as well as the resignations of the company’s Director of Operations for Europe and the Middle East, and the company’s Chief Financial Officer.

On August 11, 2009, CBp Carbon Industries responded to Mr. Fader’s press release. Here is the full press release. The company states that it will respond to Mr. Fader’s lawsuit in court and explains its decision to shut down the Hungarian plant as follows:

In 2008 Mr. Tsantrizos [the company's CTO] completed successful development of the Csongrad [Hungary] pilot plant and testing of resultant product. At the conclusion of pilot operations the Company had a decision to make as to whether to continue at Csongrad with development of a commercial plant or construct the first commercial plant in Cyprus. After extensive analysis and expert recommendation the Company board determined that expansion of Csongrad was not advisable and that the commercial plant should be in Cyprus. Under the leadership of Mr. Tsantrizos, and with no input from Mr. Fader (who was apparently not well enough to travel), the Cyprus commercial plant was built by the Company’s team and substantial new technological developments were effected in perfecting the commercial plant. The Cyprus plant was substantially completed in July, 2009 and is now undergoing ‘hot tests’ with tires being processed. In addition, close technical cooperation has been conducted with the Company’s major customer to design the Carbon Green (substitute carbon black) for best use by the Company’s customers.

Tire Recycler Holds Tour for Economic Team

McKinstry Reklaim Technologies Inc,, an Oregon tire recycler that began operations last fall, hosted a tour of state officials earlier this week. Members of the state Economic Revitalization Team toured the Port of Morrow, including the recycling. plant.

An article on the tour that appeared on the East Oregonian blog contained the following statistics for the plant:

Dan Kapral, director of advanced technology and manufacturing for Harris Group Inc. of Portland, led the plant’s design and construction. With the one processing unit it has, McKinstry Reklaim can process 105 auto tires every hour. The plant operates around the clock, so it recycles more than 2,600 tires daily.

Kapral said the company plans to add five more processing units.

Bill Langley, plant operations manager, said the recycling process produces about 8 pounds of carbon black per tire, or 21,000 pounds per day.

According to the article, the plant also produces 360 pounds of scrap steel per day, and 3,400 gallons of condensed oil, which is similar to a No. 4 diesel oil. Oil that is not condensed is burned for fuel. After the plant is expanded to include all six processors, Langley said, it will produce 60 percent of its own power.

Another Tire Recycler Enters the Fray

From the Maryville Daily Forum in Maryville, Missouri comes news that another tire recycler is entering the market for recycled carbon black. The paper reports that a new company, Carbolytic Materials Company (CMC), is about one month away from opening its pilot plant for a new carbon black alternative process in Maryville. Groundbreaking for the facility was held in November 2008, according to the company. CMC has research facilities in St. Louis, Missouri and a sales office in Hudson, Ohio.

The plant will recycle passenger tires to produce a carbon black alternative that the company is marketing as ApexCM. In the process, CMC will be taking rubber chips — primarily tire shred — and running them through a cooker, which will convert the rubber tire product into raw carbon black. That product will then be ground into a fine dust powder. A binder will be added to pelletize the carbon black alternative. According to the company, the recovered carbon black can be used in automotive, agricultural, construction and industrial rubber applications. According to the company’s website, rubber or plastic products that normally use N700 or N900 carbon black can use ApexCM. Certain applications that use N500 and N600 may also be able to use the material.

Offgases from the process will be recovered and turned into a diesel fuel and a light oil type product. Steel recovered from the tires will be sent to a steel product to a recycling center in St. Joseph. The new plant will initially have 12 employees, and has the potential to employ a total of 35 employees after expansion, according to a company spokesman. The 25,000 square-foot building incorporates production, testing, and office facilities. Initial capacity is 15,000 tons of tires per year, producing 5,000 tons of carbon black replacement. The plant has the potential to expand to 60 tons of rubber per day.

On its website, the company describes its process as follows:

Carbolytic Materials Company (CMC) uses a process that melts scrap rubber and subsequently catalytically “cracks” the polymeric materials back to oil and gas. The remaining solid materials consist principally of the original carbon black materials, which are recovered in a manner that retains their reactivity and usefulness in rubber products. Subsequent finishing steps assure the production of an effective black reinforcing and tinting material that is available commercially today (ApexCM™).

Tire Recycling Firms Seeks to Form Carbon Black Adisory Panel

Carbon Black Advisory Board Notice

McKinstry Reklaim is a Pacific Northwest company focused on reclaiming carbon black, oil, and steel from used tires through pyrolisis. Our first facility has been constructed in Boardman, OR, in cooperation with McKinstry Company and Harris Group. The plant became operational in late 2008.

We are now interviewing individuals to join our Carbon Black Advisory Board. This group will provide industry insight, experience, and contacts to McKinstry Reklaim’s management team. Candidates should be seasoned professionals with strong experience in the following areas:

Marketing and Sales: Individuals with (a) extensive sales contacts in existing carbon black market places, (b) direct experience in developing marketing and pricing strategies, and (c) direct experience in developing sales accounts.

Product and Market Development: Individuals with extensive experience in developing carbon black products for specialty applications in inks, dyes, and pigments, and for use in rubber products. Candidates will advise the product development programs to be compatible with product properties and for enhancing product attributes.

Meeting schedules, compensation, and other details to be negotiated.

Interested parties should contact Yaniv Gelnik at yanivg@mckinstryreklaim.com or 206-547-9557.

Tire Recycling Plant Gets State Funding

The Pittsburgh Tribune-Review has reported that Delta-Energy’s new tire recycling plant in Greene County, Pennsylvania has received $2.5 million in state funding from the Redevelopment Assistance Capital Program.

As previously reported on this blog, the plant will be used for tire depolymerization, a process that recovers petroleum-derived products, oil, gas and carbon black, from scrap tires. The facility will process 25 tons of waste tires per day.

According to Delta-Energy, this process results in much higher quality recycled carbon black than traditional pyrolysis, which makes the material more competitive with virgin carbon black. Bill Cole, VP, Product Management of Delta-Energy will deliver a paper on the process at next week’s Carbon Black World 2008 conference in Vancouver, BC.

Concarb Decision: Ominous Sign for US CB Industry?

The August 25, 2008 edition of Rubber & Plastics News featured an editorial (subscription required) about the recent Continental Carbon verdict that sees the decision as an ominous sign for the US carbon black industry.

Concarb’s [Kim K.T.] Pan, who feels justice wasn’t served, warned that even a shred of evidence can elicit a lawsuit. “There’s no downside for them; it’s a lottery mentality, and all they have to do is hit on one of them to collect. It can happen to any company.”

Amen, say executives at various tire companies caught in the tire recall juggernaut that began with the Ford Explorer-Firestone SUV tire controversy of the early 1990s. One after another faced lawsuits as trial lawyers found the industry easy pickings. Settle rather than fight it out was the norm for the tire makers.

Now that one of the carbon black producers has been hit with a huge judgment, you can be sure that somewhere a law firm is nosing around, trying to find a similar case to pursue.

That’s how the game is played.

This issue of R&P News also included a Materials Update dedicated to carbon black. The update included five articles related to carbon black production and use:

• Continental Carbon fights challenges in N.A.
• Delta-Energy expands capacity in North Dakota
• Sid Richardson touts SR401 grade carbon black
• Cancarb makes upgrades to keep up with thermal black
• A reinforcing agent used with virgin carbon black

Tire Recycler Charged with Fraud

From Rubber & Plastics News (subscription required) comes news of fraud regarding a tire recycling company.

On July 31, 2008, a federal district court in Detroit froze the assets of a Michigan-based tire recycling company, Encore Associated Leasing, LLC, as well its president and his son. The action followed an allegation of fraud by the Securities and Exchange Commission.

According to the SEC’s complaint, from September 2006 to July 2007, Merklinger raised at least $7.2 million from five investors through the sale of investments in his purported tire recycling business. The investments consisted of an interest in a tire shredding truck that Encore Leasing would lease from the investor and purportedly use in its business operations, and a $10,000 warrant for a 1% interest in Encore Leasing. Merklinger told investors that a working prototype of the shredding truck existed and that their trucks would be in operation shortly. He promised that Encore Leasing would pay the investors $15,000 in monthly leasing fees and investment interest, and that after five years, the investors could expect returns of up to 372% and the warrant would be worth at least $1.2 million. However, as alleged in the SEC’s complaint, there was no working prototype, no reasonable basis for Merklinger’s income and return figures, and the investors never received a dime from their investment. Instead, Merklinger used more than $950,000 of investor funds for his own personal benefit, including payments for rent, back taxes and the purchase of luxury automobiles and watercraft and extravagant landscaping and furnishings for his home. He also, as alleged in the SEC’s complaint, spent or transferred more than $172,000 for the benefit of his son, Brian Merklinger, and used more than $134,000 to make payments to investors in one of his other companies. Further, Merklinger failed to disclose to investors that he had been barred from participating in Ontario, Canada’s securities markets for ten years in connection with a prior investment scheme.

The SEC’s complaint charges Paul Merklinger and Encore Leasing with violating federal securities laws (specifically Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder). It seeks permanent injunctive relief, disgorgement of investors’ funds, and civil penalties. The complaint also seeks disgorgement of all investor funds provided to Brian Merklinger.

Delta-Energy Completes Expansion of Tire Recycling Plant

On August 8, 2008, Delta-Energy announced that it has completed an expansion of its tire recycling plant in Berthold, ND. The plant utilizes the company’s DePolymerization process to recover carbon black-based materials as an alternative to virgin carbon black. The plant’s capacity was expanded by 50%.

Below is the main text of the press release.

Delta-Energy, LLC, the premier resource recovery company specializing in recovering carbon black based products for reuse in rubber and plastic compounds, announced today that they have completed the expansion of their DEPolymerization™ plant in Berthold, ND. The plant’s capacity to recover carbon black based materials has been expanded by 50% in order to meet growing demand for Phoenix Black®, a green alternative to virgin carbon black used for rubber reinforcement.

Delta-Energy’s Phoenix Black product line reinforces a wide range of rubber compounds similarly to medium and low reinforcing carbon blacks. The products are being used in dynamic and static rubber applications. Zephyr Black product line has the tint strength of carbon blacks used in commodity black plastic master batches and coatings.

“Our DEPolymerization process takes one of the world’s biggest pollution problems – discarded tires – and turns them into usable gas and liquid fuels and recovered carbon black based solids. With the rising cost of raw materials and base energy we are experiencing an ever-increasing demand for DEPolymerization products,” said Paul Lee, Chief Executive Officer, Delta-Energy, LLC. “The increased capacity of our Berthold plant will definitely help bridge demand, especially black demand, as we construct our next plant.

Currently the company has plans to begin construction of a second plant in Greene County, Pennsylvania in the fourth quarter of 2008 and is reviewing other proposed building sites.

CBp Carbon Moves Into Next Phase for Production of Recycled Carbon Black

In a press release from August 6, 2008, CBp Carbon Industries (Bratislava, Slovak Republic) announced that it is moving into the next phase of its plan to build a commercial production facility to produce a carbon black replacement from recycled tires.

The company reported that it had recently completed Phase 2 of the three phase program, which involved using its pilot plant in Hungary to determine the most viable technology configurations for its process and to engineer the facility to produce varying quantities and qualities of its carbon black replacement, which is marketed as CBp Carbon Green. This phase also involved the delivery of test quantities of the product to tire manufacturers in Europe, North America, and Asia for evaluation.

Under Phase 3 of the program, CBp Carbon plans to complete construction of its first generation commercial production facility located in Limasol, Cyprus by 4Q 2008, with full commercial operation by Q1 2009. The Phase 3 test production plant has been moved to the Cyprus facility.

The startup of the Cyprus facility will be followed by commencement of larger next generation facilities in Greece and North America (30,000 tonnes per annum minimum), with other regions to follow. The company reports that it is assessing sites in Europe and North America for commercial plants in cooperation with governments and local businesses. The company expects to break ground on at least three next generation commercial plants in 2009. Further, CBp President John Novak has indicated that the company plans to build at least ten plants per year, within the next three to five years, in conjunction with participating governments and major industry partners.

According to company sources, the 30,000 tonnes of capacity for these units refers to the amount of tire shred processed per year and does not refer to output of carbon black replacement. The company’s process produces energy (syngas, which is converted into electricity), scrap steel, and carbon black replacement.