Renewables companies Butamax and Gevo have ended their four-year patent dispute relating to their bio-based isobutanol technologies. Litigation between the parties started in January 2011 when Butamax filed against Gevo in a Delaware court alleging patent infringement.

Both companies have entered into worldwide patent cross-license and settlement agreements which they said will accelerate the development and supply of bio-based isobutanol.

Under the agreement, both companies get patent licenses to all fields for isobutanol as well as the right to sub-license their respective technologies. When licensing to third parties, Butamax and Gevo have agreed not to exchange or use each other’s proprietary microorganisms, use different enzymes and different product recovery systems.

Both parties are also free to sell up to 30 million gallons per year royalty-free into any field, after which certain fields bear royalties. Butamax will get royalties from on-road gasoline blendstocks and chemical isobutylene applications, while Gevo will receive royalties on alcohol-to-jet (ATJ) fuel, marine gasoline blendstocks, retail packaged fuels, and paraxylene. No royalties will be paid in the fields of off-road gasoline blendstocks, iso-octane, diesel and solvents.

The companies have agreed to leverage each other’s regulatory approval and market development activities to accelerate market growth and reduce duplication. As such, Butamax will focus on securing the required approvals for blending bio-based isobutanol in on-road automotive gasoline.

Gevo, meanwhile, will focus on the use of renewable ATJ fuel. The company has been producing ATJ fuel at its demonstration bio-refinery in Silsbee, Texas, using isobutanol from its fermentation facility in Luverne, Minnesota.

“Setting up the marketing relationships, as we have done, brings to bear the capabilities of each of the companies,” said Patrick Gruber, Gevo’s CEO. “We very much look forward to developing a very large, growing and profitable isobutanol market in conjunction with Butamax.”

Paul Beckwith, CEO of Butamax, added: “The aim of these agreements is to accelerate development of markets for bio-based isobutanol. This will create exciting opportunities for ethanol producers to expand their businesses by becoming isobutanol producers, at the same time enabling the most competitive isobutanol supply for customers.”