Now an independent company, Lummus Technology has become a leading technology developer for new capacity expansion investments in the industry. Their expertise, reputation, and skilled team are applying startup energy to excel independently and drive innovation. Leon De Bruyn, President and CEO of Lummus, an expert in the technology and chemicals, has played a crucial role in the growth and success of Lummus. Leon explores the remarkable transformation of Lummus, a more than one hundred-year-old startup in startup mode.
In this episode of The Chemical Show, host Victoria Meyer welcomes Leon to share his wealth of knowledge and experience as he uncovers the secrets behind Lummus’ remarkable evolution. Leon shares his leadership strengths and abilities and sheds light on Lummus’ emphasis on portfolio expansion, growth, and incorporating new technology innovators. Exploring their focus on providing expertise throughout the value chain and their investment in innovative technologies, Leon shares Lummus’ interest in energy transition and market growth.
Learn more about the following topics this week:
- Challenges and opportunities of creating a new standalone company on the shoulders of an old company
- Shifting mindsets: From engineering hours to customer value and technology
- Instilling a new culture to drive growth and innovation
- The role of digitization in Lummus’ business
- Building a technology portfolio for the future
Victoria and Leon discuss Lummus’ accomplishments, its plans for the future, and the importance of leadership in navigating challenges, all while maintaining a culture of innovation and entrepreneurship. Join us as we uncover Lummus’ fascinating story and gain valuable insights into the ever-evolving chemical industry.
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Listen to Victoria Speak with Leon about Lummus Here:
Watch Victoria’s Conversation with Leon on Youtube Here:
How Lummus Technology is Applying Startup Energy to a Legacy Business with Leon de Bruyn of Lummus
Hi, this is Victoria Meyer. Welcome back to The Chemical Show. Today I have the opportunity to speak with Leon De Bruyn, who is the president and CEO of Lummus. During his 30 years with the company, he’s worked in eight countries and held a variety of roles in technology development, licensing, catalyst supply, and engineering activities. Most recently, prior to being named President and CEO, he led the transformation of the Lummus business from a subsidiary of McDermott to where it is today as a standalone company owned by the Chatterjee Group and Rhone Capital. In 2021, Leon was named Executive of the Year by Hydrocarbon Processing. So, Leon and I have some great things to talk about. Leon, welcome to The Chemical Show.
Thank you Victoria, and I’m really excited to be here.
I am excited to have you here. Let’s start with your origin story. What got you interested in energy, chemicals and technology and what ultimately got you to your current role?
I’ve already always had a very keen interest in technical things and decided to study chemical engineering. While doing that I had an opportunity to work with some of the smartest professors who really catapulted material science for the university I was attending. Even today, I think that is really at the forefront of our industry and new materials. The science applied into consumer products. For Lummus, that is the forefront of where we see new innovations that materialize, creating new products, new enhancements of quality of life from every variety. That’s where I really think there’s an exciting opportunity for us to contribute.
That’s great. So can you tell us a little bit about Lummus? Just because some people may not be familiar with it, although I think they should be.
We are a 100+ year old startup company still in startup mode. We have a long history, started by Walter E. Lummus in 1907, and he was an entrepreneur innovator, he really shaped the DNA of the company. We are still very entrepreneurial. We are focusing even more on innovation than ever before. What he did is very relevant today. He started with molasses as a feedstock for transportation fuels, and guess where we are a hundred years later. More recently, Lummus was owned by engineering companies and we were very lucky to be carved out from that in 2020 and become an independent, pure play technology company.
There’s almost no investment in the world in downstream production where Lummus is not participating in one way or another. Wind fuels, petrochemicals, polymers, energy. So maybe Lummus Technology doesn’t resonate with many memories. but I think our customers all know Lummus. We are focusing on business and it’s rewarding to know that we’re participating in some of the largest projects that are built around the world.
Yeah, absolutely. I’m very familiar with your polymer technology, some of your olefins technology and other things. As you say, it’s all around the world in some of the most impactful projects and businesses.
Lummus is a hundred year old business. I think that’s fascinating. I didn’t realize it started with molasses into fuels, and here we are again going from sugar into fuels. So that, in its own way, is a very circular technology. But it’s a hundred year old business operating as a new entity, I’ve talked to folks that have carved out businesses from other companies, and I’ve worked in M&A and in joint ventures myself. What are you finding as really the challenges and the opportunities of creating this new standalone company on the shoulders of the old company and the old technology?
Yeah, it is amazing that three years ago we had the opportunity to create a technology company with the future in mind, but at the same time capitalizing on what has been built up for decades in terms of brain power, infrastructure, DNA, culture, and reputation in the markets. At the same time we were able to use those ingredients and basically shape our future. Three years ago we had the foresight to really invest heavily our time and resources into what we felt was going to matter 10 years out, or 20 years out. So of course that is in a backdrop of energy transition and growth in the markets, but there’s also perfecting technologies. It’s reinvigorating innovation.
A lot of ideas are in peoples’ heads and it depends on the culture of the company, whether those ideas actually get cultivated and get applied in the products that we provide to our customers. I think what we managed to do in the last three years is fuel by a passion. You can talk to anyone in Lummus, they will say that three years ago we were liberated, became independent as a company, and fast forwarded many of the ideas that were already there. We were able to materialize them. As a result, just to name a few, we created a Net-Zero cracker, an ethane cracker that doesn’t produce any CO2. We came up with a partner to take waste plastics out of the waste stream and use it as a feedstock and bring that back into the petrochemical industry creating circularity. We acquired the Siluria assets to convert stranded methane back to olefins.
So many things happened on the technology front, and then at the same time we instilled a mantra in Lummus: Never leave the customer. Never leave the customer means that we don’t just work with them on the technology phase, make sure that gets implemented properly and is operated properly. Our customer’s ever-changing market dynamics, whether it’s on the feed stock side, on the production side, pricing, legislation, whatever it is we help our customers. Post startup for the next 40 or 50 years, adapting their plans operationally or with some small investments to optimize in a changing context. I think that is part of that mantra of never leave the customer. We deliver on that by organizing ourselves around the customer. We have been stepping up and continue to step up our presence close to our customers. Preferably in their shops, but certainly within a driving distance. So that local expertise is there constantly with them to provide consultative services. So there’s a lot of things that have changed in the minds of our staff now that we’re standalone.
And what strikes me with this is, if I think about Lummus as a technology business inside of an engineering organization, which you were for many years. From the outside in, it feels like the objective of the company is to drive more engineering hours for capital projects. Yet when you become this standalone technology company, your relationship with your customers can change. Your relationship with your own business and how you approach innovation can change. Then your relationship with your employees can change because they’re no longer about punching the clock and billing the hours out, although that’s perhaps still a part of your business model, but it becomes something different.
You got it absolutely right, Victoria. The biggest change is we are now owned by shareholders that only have an interest in growing a technology business. Being an excellent partner to our customers, looking for other ways to create value for them and willing to invest. I think that is hitting on what you also mentioned, willing to invest in things that matter for technology without being held back by parental needs. They are probably the biggest promoters to me and the rest of the leadership team in driving many of the initiatives. Some will succeed, some will fail.
All in all, we are really racing forward and I don’t see how we would’ve done this in the past. So, the passion and the eagerness, the desire of our employees to prove that as an independent company we can do better than otherwise. That helps the support of our shareholders. Then finally, just every ingredient that we have, the reputation, the R&D centers, the technology scientists, and engineers. I think we have perfect storm in our favor right now where everything is happening at the same time, in the right direction.
That’s awesome. I know change is hard. So I think the ability to shepherd this change along is pretty significant.
Lummus was liberated in 2020. We’re now, just in an interesting business environment with all the forces going on, both from the drive to Net Zero, sustainability and circularity. At the same time, from an economics perspective the war in Russia and Ukraine has really had a significant effect on global markets, what’s happening in China has had a pretty significant effect. I’ve always viewed Lummus as a business that is predicated on growth, and on the next thing and on a continuing growing economy, which some people would say maybe that’s not the case. What do you see, what is your view and Lummus’ view on the current and the future business and market environment?
Of course the market drivers and the context that you described are all there. You have to also remember that when Lummus stood up as an independent company, we were in the midst of Covid. Financial markets were closed. We had to capitalize our company for well over two and a half billion without financial markets. But, I think it’s part of our mindset that we’re going to make it work. We’re going to get to the other side no matter what. That mindset also helps us in addressing the changes that are happening in the market, the geopolitics, geographical shifts of production, and demand. Did China potentially over capacity or not? That’s still a question we are facing in the industry. What we have done in Lummus is continue to be the number one technology developer for these new capacity expansion investments, and that has not changed.
So the cycles in that industry are still absolutely valid for us. But two things. One, as an independent company we seem to be more successful. Our success rate of convinced customers has gone up relative to where we were in the past. I’m convinced that’s the result of more passion for what they do and truly having better technologies.
The second thing we have done is fundamentally changed our business model from almost entirely dependent on new investments to two other things. One, customers facing the energy transition requirements are looking at adapting their assets. Think in the US, if you are a large producer of gasoline, It’s not a question of when, it’s a question of how fast does the gasoline demand for the market you’re serving reduce. We have a role to play as a technology company with our customers. Not just when they invest, but also when they operate. Think again, never leave the customer. That’s our responsibility to help them look for opportunities to apply technology and move from one production target to a different production target that is a different product slate or go away from gasoline and make petrochemicals. We have a lot of innovations. That’s materialized in the last three years to help let’s say FCC conversion from gasoline to max olefin or max petrochemicals.
The second thing is our business model has fundamentally changed to not just being dependent on investment cycles, but also just operating cycles. So we sell catalyst consumables, we provide services consultants, we help customers throughout their entire operating cycle, and those have a different dynamic than new investments and they’re almost countertrends. So I think what the industry is facing today with the chemical companies lowering their forecast for the full year. Pausing some of the investment decisions, what would we’re doing better this year than we’ve ever done in terms of sales, in terms of revenue, in terms of portfolio, and we’re seeing next year as a further step up. So I think that de-risking of the cycles with the operating as well as investment dependency and having better services technologies, people. I think combined with the repurposing of existing assets weathers are extremely well.
I think that’s a great perspective, because as you say the current operators need to find solutions, so helping them find those future solutions is critical. What strikes me is a lot of the things you’re talking about require a different culture, require a different type of talent perhaps, and maybe just require more talent and different skill sets. How are you navigating the people and the culture, bringing people in, keeping your existing employees and helping the company, the culture and the talent within the company get to the next place?
That is probably closest to my heart of all the topics. This is where leadership matters. During Covid, not many companies were able to to adapt. Certainly we were not in a position to make drastic changes. In May last year, we set up our new leadership team that is driving with me the company’s business, but especially people’s management and culture and that leadership team are all individuals that have earned our ranks in our industry, whether it’s in petro chemistry or in polymers or in clean fuels. They all have a reputation of being great people and managers. Then finally, they all have a stake in Lummus’ success going forward, which we cannot achieve by ourselves.
We need to have all our staff with us in this. In this journey of the culture we’ve created, we’ve come a long way and we’re almost there, in having the perfect culture for our future. That in turn attracts a lot of new talent that is either coming out of college or is in the industry looking to join a company that is more modern in thinking like Lummus. So we’ve been attracting a lot of talent in the last two years that are helping us on this cultural journey. I can say that with the mindset of our leadership team, the passion for the business and the selection of bright people, we’re getting there.
Now, final point is we all have to celebrate successes. Many companies leadership team gets a bonus if the company works hard and then we grow and the company works even harder. I don’t support that mindset. I think everyone in a company should enjoy successes and celebrate successes, and that’s where we’re headed this year. We are doing a lot more wins, celebrations, or great stories where we all enjoy and all share in the results of where we’re headed.
That’s exciting, I think that’s it’s important. I know a few people that are at Lummus and I think they’re all very positive about where the direction of the company is going. Talent is a challenge though, we’re seeing this all across the industry. So figuring out how to to tackle that and be able to bring in and retain that talent is important. When we think about, you know, some of the other trends that are really hitting the industry, digitization is something that really has accelerated in the past three to five years. So what role does that play in Lummus’ business?
I was listening to your podcast with Mr. Reynolds of AVEVA and I think he has it right. The operational excellence is coming from digitization, whether you look at improving operating margins uptime, eliminating waste, and unnecessary costs. Probably addressing more profitable productions versus, just keep producing what we have been producing. So digitization for our customers is going to be of growing importance.
In Lummus, we set up Venture Lummus Digital two years ago to help our customers in that journey of digitization with clear use cases. Something that I think is unique for Lummus relative to others, we combine the first principles of our process, technology knowledge. We have designed the plant, so we like to think that we have some ideas on how the plant can be stretched and operated as well as the data science from the feedback of the actual operating plan.
So by bringing the two together: the actual operating data and capabilities of the plant that was invested in through data science with the first principles knowledge. I think we can help customers to have a laser focus on optimizing their operations besides the normal remote monitoring and other things. In addition to that, improving uptime by a one day, and this one day is a tremendous improvement goal.
It’s a huge dollar amount, right? The money on the table and the operational and the human risks that go with it are significant.
Our Lummus Digital is showing good market traction and is helping our customers on that journey. I did want to say something else, and we kind of browsed over it, but you mentioned the circularity and energy. So the decarbonization is happening whatever your beliefs are. There’s clear mandates by several governments around the world to decarbonize, and we also see new investments are going to require a clear decarbonization strategy of companies.
Our approach has been, again, with the two brains. One is for new investments. We want to have the best in class technology solution, not just from an economic perspective, but also from an energy intensity index point of view or carbon footprint point of view. At the same time, we recognize there’s a lot to be gained from the existing asset base. Our industry has built up that existing asset base over 40, 50, 60 years. By making a 1% or 2% improvement in that existing asset base, it has a profound impact on what we’re all trying to achieve.
So we are addressing both, what can we do to an ethylene plant? How can we make it net zero or least get close to it, even though it’s been operating for a while. To remove dependence on import fossil fuel firing and go in the right direction. Our industry has a big need and hopefully we can fill some of that need with our innovations.
Yeah. I think that’s very good perspective, because we can’t only invest in new to get this solution solved. We have, as you say, this huge installed base of manufacturing plants, of people, of technology. That, in many ways actually, if you look at it from where we are today versus where we were 20 years ago, is already operating more sustainably with better carbon neutrality carbon reduction in many cases. We have to be able to optimize the existing plants, it’s probably even more critical than what we do in terms of future builds.
I couldn’t agree more. This is also where partnerships matter. Where, you move away from a traditional, I’m going to buy a technology, I have an EPC contractor build it, and then I’m going to operate it and I’ll have a maintenance contractor maintain it for the next 40, 50 years. Now as an industry we realize it. You have to partner to really capture those opportunities, especially for existing assets.
Many opportunities that we are working on are in that space where a client had invested in a plant 10, 15 years ago and now we’re working together with them to look at economic optimization, but also carbon footprint optimization. Often they go hand in hand. Especially once you have an asset that was built 10, 15 years ago, economic parameters have shifted and by investing in efficiency, process intensification, better catalyst or better heat transfer equipment, you can make a lot of gains without abandoning that existing asset.
So you talk a lot about partnership, Leon. It strikes me that it comes in a couple of different formats. One, I know you’ve partnered quite a lot with other technology providers and innovators to help bring technologies to market. Certainly in a lot of the carbon neutral and green technology spaces as well as in digital. I think you talk about partnering with your customers as well in terms of that lifecycle value. What’s important to you and Lummus in partnership and what makes a good partner?
So that’s the fundamental question. I’ve headed the joint venture between Lummus and Chevron, called Chevron Global for a while, and it’s apparent that if there is the right trust, between partners and similar value sets, those are probably the most fundamental basis for the partnership. There will be different strategic interests, and that’s actually sometimes helpful because both will move the partnership for the strategic interest that that each have. But, I think having the trust that we know what the other are doing, the others know what we are doing, and there’s an implied trust that it’s always a positive intent to get to the right outcome that is beneficial to all.
So this Chevron-Lummus joint venture was started in 2000 and we just celebrated 23 years. There’s not a lot of joint venture that last that long. When we look at an opportunity to partner, like we did with Braskem about a year ago and New Hope a little before that, as to examples, we all bring different things to the table and nothing is perfect on day one. But if there is that shared value sets and determination of making things work, we’re going to get to a perfect outcome.
The Braskem partnership is now very active, and I’m sure you follow in the news with their joint venture creation in Thailand they’re getting ethanol as a new feedstock in new production of ethylene, and then derivatives of ethylene. We’re their partner in this. We are also doing the same with our clientele. They’re really happy to see that come together in multiple locations so that at the end of the day we’re collectively making a positive impact on the world.
That’s cool. So what’s next for you and for Lummus, Leon? What should we be looking for over the next 12 to 18 months?
Portfolio expansion growth, not just by what we do in-house, but we’re now at a point where because of our, the breadth of our portfolio and the organizational capabilities we have, whether it’s the engineers, mechanical and chemical, or our ability to compute in a simulation model what others are operating. So we have been attracting new technology innovators and at some point it makes sense to bring them in the fold of the Lummus portfolio one way or another. Whether it’s through partnerships, as we just discussed or other ways. It doesn’t really matter, we want to make sure that we can help our clientele, our customers, when they’re looking at investment opportunities again for a new build or for their existing assets that we can help them with the whole value chain from the feedstock molecules all the way to the product molecules and into steps for that. So having that whole value chain and having deep understanding of the technology to get from start to finish is a value to our customer. Bringing that into our fold one way or another is going to be what you’ll see in the next 12 to 18 months.
We’ve already done a little bit. We acquired wastewater treatment technologies, formerly owned by Siemens Energy, and it’s another area where you will see our expansion, all the processes that are being operated or invested in have some way of either consuming water or producing water or spoiling water. If the industry can address that and eliminate or minimize consumption of water, can eliminate contamination or can redirect water for especially processing water for better use. We want to make sure that all of our processes have the responsible use of water and responsible production of water decarbonization. We cannot invent everything ourselves, so we’re going to look at partnering with some of the other players and bring them in our fold.
The industry is increasingly going from liquids to chemicals. There’s massive projects planned in the Middle East that have been announced by the bigger players there. We have a role to play with that whole chain of feedstock all the way to the final polymer product. I think we have a role to play there and we will. We will invest heavily to be the partner of choice. So that’s what you’re going to see. I think you’re going to see a lot of smiles on the face of colleagues, especially the ones that you know, because we’re doing something right, that we believe in. We have a purpose to help the world make the quality of life possible with better products that are derived through responsible technology, and can materialize the passion that we have for innovation. So I think you’ll see a lot of smiles on the faces of people.
That’s sounds like there’s some very exciting and busy times ahead.
After 30 years in our industry, I can say this is probably the most exciting and rewarding phase I’ve ever experienced. I hope it will last forever.
I agree. That’s awesome. Well, Leon, thank you for joining us today on The Chemical Show. This has been excellent.
Thank you, Victoria. It was my pleasure.
Absolutely. And thank you everyone for joining us. Keep reading, keep following, keep sharing, and we will talk to you again soon.
About Leon de Bryun:
Leon de Bruyn is the President and CEO of Lummus, where he is responsible for all aspects of Lummus’ strategic direction and global performance. During his 30-year career with Lummus, he has worked in eight countries establishing executive experience in the downstream refining and petrochemicals industry, through technology development, licensing, catalyst supply and engineering activities.
Prior to his current role, he led the transformation of the Lummus business from a subsidiary of McDermott to a standalone company owned by The Chatterjee Group and Rhône Capital.
He holds an MBA from Duke University, and a Masters in chemical engineering from Eindhoven University in The Netherlands.
In 2021, he was named Executive of the Year by Hydrocarbon Processing, a leading downstream industry publication.