Leaders Q&A: Phil Hodgson

As environment-friendly technology has become an inescapable subject of discussion in the cement industry, CemWeek presents an exclusive interview with Phil Hodgson, Managing Director at Calix, about carbon capture and storage (CCS) and how it can help the cement sector step up its ecologic game.

Calix is leading the LEILAC (Low Emissions Intensity Lime And Cement) project, which includes a consortium of the world's largest cement (HeidelbergCement, Cemex, CRH/Tarmac), and lime (Lhoist) companies, as well as leading research and environmental institutions (Imperial College, ECN, Quantis, The Carbon Trust). How did this project come to be?

Calix's technology was originally developed to look at processing carbonates such as limestone and directly separate and thus efficiently capture CO2. After Calix proved the technology on a commercial scale for another carbonate mineral, magnesite, in its Bacchus Marsh plant, it reignited interest in looking at applying the technology to the cement and lime industry, which use huge amounts of limestone.

Calix started talking to big cement and lime companies and, with those that took an interest, formed a consortium to apply for funding from the European Horizon 2020 scheme, which is specifically for research and development relating to climate change strategies. The consortium, with Calix in the lead, was successful in winning funding and the project commenced in 2016. The project team included a selection of major cement and lime companies plus some research institutes and specialist engineering and technology companies.

Calix has secured Ôé¼3.4 million in working capital from EFIC, the Australian Government's export credit agency, to build a CO2 capture facility for the LEILAC project, in Belgium. What are your expectations for this initiative?

Typically with grant funding of projects such as LEILAC, there is a grant drawdown schedule that pays back eligible costs once they are incurred. That means that costs are incurred and carried by the grant recipients until their work is checked and verified by the grant administrators.  

As a small Australian company building a plant in Europe, the upfront costs were significant. While the grant would repay these costs, Calix had to come up with the money upfront to purchase equipment and employ contractors to build the plant. Reimbursement would come months or even a year or two later, which could create a large gap in the business's cash flow.

To help Calix secure its commitments under the Horizon 2020 grant, EFIC provided the working capital. The expectation is that, once construction is complete, Calix will achieve the grant drawdown, which will let it repay the EFIC loan. The consortium can then start up the plant, and hopefully prove the technology works!

Read the full interview in CemWeek 45