Sweden-based Scandinavian Enviro Systems and London-based private equity fund Antin Infrastructure Partners have formed a joint venture supported by Michelin to create what they claim is the world’s first large-scale tyre recycling group.
The JV will combine Enviro’s unique and patented technology for the extraction of carbon black and pyrolysis oil from end-of-life tyres with Michelin’s leading position in sustainable tyres and Antin’s expertise in developing and scaling infrastructure platforms to enable the industrial development of this innovative recycling technology.
The JV has secured a multi-year supply agreement with Michelin for the first plants established, which also includes delivery of recovered carbon black and tyre pyrolysis oil (TPO).
The initial investment in the JV will be funded by Antin’s NextGen platform, which will be the majority owner of the JV. Enviro’s ownership in the joint venture will ultimately correspond to approximately 30 percent. As part of the JV, Enviro’s patented technology will be licensed to the JV on an exclusive basis throughout Europe.
The first full-scale commercial plant will be built in Uddevalla, Sweden, with initial capacity to recycle 34,500 tonne of disposed tyres, equal to 40 percent of the annual volume of end-of-life-tyres in Sweden. The plant construction is scheduled to start in the first half of 2023, subject to a final investment decision by the JV, and the plant is expected to be fully operational by 2025.
The partners say following the successful commissioning of the Uddevalla plant, acceleration of the European roll-out will commence. Site selection in other European countries has been initiated to ensure a rapid roll-out, with an aim to build recycling capacity for up to approximately a million tonne of end-of-life tyres by 2030, corresponding to a third of all tyres being disposed of in Europe each year.
Reducing carbon emissions
The partners say the volume of disposed end-of-life tyres has been steadily growing and will reach 3.5 million tonne per year in Europe alone. The JV will develop with the support of Michelin, end-of-life tyre recycling plants throughout Europe to produce sustainable raw materials. These include reclaimed carbon black and oils that can be reused in the tyre and petrochemical industries.
By replacing virgin carbon black with Enviro’s recycled carbon black, carbon emissions can be reduced by more than 90 percent, compared to using conventional carbon black. Based on the target volume of one million tonne of end-of-life tyres, carbon dioxide emissions would be reduced by 670,000 tonne.
Alf Blomqvist, Chairman, Enviro said: “With Antin’s successful track record in scaling infrastructure platforms and its strong industrial understanding, and Michelin’s leading position in sustainable tyres, we have found excellent partners to jointly accelerate our all-European plant expansion and contribute to making the tire industry circular. Enviro will now be able to focus on our core business and competencies such as technology and material development, optimisation and quality control.”
Anand Jagannathan and Rodolphe Brumm, NextGen Partners at Antin Infrastructure Partners, commented: “Enviro’s patented pyrolysis technology and its highly experienced management team, combined with Michelin’s world leading position in sustainable tyres, makes this an ideal platform. Antin has always been at the forefront of identifying key areas of tomorrow’s infrastructure and we believe this JV will play a critical role in accelerating Europe’s circular economy.”
Maude Portigliatti, Executive VP, High Tech Materials – Member of the Group Executive Committee at Michelin, commented: “This is further proof of Michelin’s ability to step up to achieve its 2050 strategic ambitions and reduce the tyre’s overall environmental impact by forging innovative partnerships for an ever more circular industry.”