Covestro signs off-take agreement with Encina for circular raw materials

Leverkusen, Germany – Covestro AG and Encina, a US-based producer of ISCC+ certified circular chemicals, have signed a long-term agreement for the supply of sustainable feedstock derived from post-consumer end-of-life plastics.

Specifically, Encina will supply Covestro with benzene and toluene pending the completion of its $1.1-billion production facility in Point Township, Pennsylvania, by end of 2027.

Encina has developed a proprietary catalytic technology to produce - with “an exceptionally high yield” - circular feedstock with a lower carbon footprint compared to those based on fossil fuels, according to Covestro.

The agreement marks the Leverkusen-based group's first major procurement deal involving chemically recycled raw materials, Covestro announced 17 Jan.

The move, it said, is “a major step” in Covestro’s journey towards full circularity and will help reduce scope 3, indirect emissions down the supply chain.

To source raw materials from used plastics will contribute towards Covestro’s vision of a circular economy, said Thorsten Dreier, Chief Technology Officer at Covestro.

Benzene and toluene are important raw materials in Covestro’s manufacturing processes used for the production of methylene diphenyl diisocyanate (MDI) and toluene diisocyanate (TDI), respectively.

MDI and TDI are critical raw materials used to produce rigid and flexible polyurethane foams, used in applications such as household appliance and building insulation as well as furniture and car seats.

Benzene can also be used for the synthesis of phenol and acetone – raw materials for making polycarbonate plastics, another key product of Covestro.

"This agreement represents the beginning of what we hope to be a long-standing partnership… to create a truly circular economy," said David Roesser, CEO of Encina.