Presentation to: Governor

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Presentation toGovernors Ethanol Coalition
US EPA Environmental MeetingEthanol and the
Environment

• February 10, 2006
• Jeff Passmore, Executive Vice President
• Iogen Corporation

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The Leading Firm in Cellulose Ethanol Technology

• Pioneer in making ethanol from biomass
• Active since late 1970s
• 120 million spent in development
• 30 million annual revenue in related businesses
• A leading position
• 178 employees focused in this area
• 40 million demonstration plant the worlds
  first
• Competitive commercial manufacturer of enzymes
• Alliances

60m
21m
16m
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Iogens cellulose ethanol process
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Iogens Ottawa demo plant - The worlds most
advanced cellulose ethanol facility
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Demonstration Scale Prototype Cellulose Ethanol
Plant
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Demonstration Scale Prototype Cellulose Ethanol
Plant
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Demonstration Scale Prototype Cellulose Ethanol
Plant
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Demonstration Scale Prototype Cellulose Ethanol
Plant
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Steady production underway since April 04
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First cellulose ethanol shipment - April 21, 2004
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The 9,000 mile launch of cellulose fuelled E85
Yukon Aug. 2004
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Iogen cellulose ethanol fuels G8 leaders
vehicles Gleneagles, Scotland, July 2005
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Iogen cellulose ethanol fuels delegates flex
fuel fleet at COP11, MontrealNovember 28
December 9, 2005
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Straw and stover - Our oil

• Farmers often burn or plow-under the residue that
  could be used as feedstock.
• In certain black soil zones, straw burning would
  be eliminated.

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DOE Cellulose ethanol could deliver 20 savings
in gasoline consumption
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DOE USDA Cellulose ethanol could displace
over 30 of the countrys present petroleum
consumption
The purpose of this report is to determine
whether the land resources of the United States
are capable of producing a sustainable supply of
biomass sufficient to displace 30 of the
countrys present petroleum consumption (i.e. 60
billion gallons per year)1 billion dry tons of
biomass feedstock per year The short answer to
the question is yes.
Source USDOE / USDA April 2005
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States capable of supporting a cellulose ethanol
industry
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Iogen Cellulose Ethanol Plant Preliminary U.S.
Feedstock Availability Assessment Based on total
wheat and barley straw averages for
1999/2000 drawn within a 100 km radius (metric
tonnes)
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5
4
3
12
2
13
15
1
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29 January 02n
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19
11
10
7
14
6
16
8
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1. MN-ND South (2.3) 2. MN-ND-North (2.3) 3.
NE Montana (2.2) 4. Whitman-Lata (2.2) 5. North
Central Montana (2.2) 6. South Central Kansas
(2.0) 7. Western KS -Eastern CO (1.9) 8. North
Central OK (1.9) 9. Lincoln-Adams-Grant (WA)
(1.8) 10. North Central Kansas (1.8) 11. NW
Kansas -S. Central NE (1.8)
ACRES
12. NW-ND (1.6) 13. Walla-Walla-
Umatilla (WA-OR) (1.5)
Not Estimated lt10,000 10,000 -24,999 25,000-49,999
50,000-99,999 100,000-149,999 150,000
14. Hodgeman (1.4) 15. Central North Dakota
(1.4) 16. OK Panhandle (KS,CO,OK,TX) (1.2) 17.
North Central South Dakota (1.2) 18. SW Oklahoma
(1.1) 19. North East Colorado (1.0) 20. Chase
County (.67) (by request)
Reference Superimposed on the USDA Map - All
Wheat 1999 - Harvested Acres by County created by
USDA National Agricultural Statistics Service.
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29 January 02
Iogen Cellulose Ethanol Plant Preliminary U.S.
Feedstock Availability Assessment Based on total
corn stover averages for 1999/2000 drawn within a
100 km radius (metric tonnes)
Reference Superimposed on the USDA Map - All
Corn for Grain 1999 - Harvested Acres by County
created by USDA National Agricultural Statistics
Service.
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8
20
13
4
7
6
14
3
11
10
16
5
12
9
2
1
18
21
22
23
15
24
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ACRES
1. E. Central IL - W. Central IN (11.7) 2.
W. Central IL (11.0) 3. North IL (10.9) 4. N.
Central IA S.Central MN (9.6) 5. S. Eastern
NE (8.9) 6. East Central IA (8.6) 7. NW Iowa
SW MN (8.4) 8. Central MN (8.3) 9. Central
Indiana (7.8) 10. West Central Iowa (7.7)
11. S. Central Iowa (7.5) 12. S. Central NE
(6.6) 13. NE Iowa SE MN (6.3) 14. NE Nebraska
(5.9) 15. South Illinois (3.6) 16. SW NE
Chase County (3.4) 17. OK Panhandle
(KS,CO,OK,TX) (2.9) 18. NW KS S. West NE
(2.5) 19. MN-ND South (2.5)
Not Estimated lt10,000 10,000 -24,999 25,000-49,999
50,000-99,999 100,000-149,999 150,000
20. N. Central SD (2.3) 21. NE Colorado
(2.2) 22. W. Kansas Eastern CO (1.9) 23.
Hodgeman (1.6) 24. S. Central KS (.84)
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- supporting E4 to E7
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Benefits to energy security

• Cellulose ethanol can have a significant impact
• Over a billion tons of agriculture and forestry
  residue plus dedicated crop material is available
  in the US, according to recent DOE/USDA estimates
• Using Iogen yields, a billion tons of cellulosic
  material equates to the production of 75
  billion gallons of cellulose ethanol or, on an
  energy basis, over 40 of the US current gasoline
  consumption

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Benefits to the environment DOE Ethanol made
from cellulose has virtually no net CO2 emissions
Gasoline Ethanol from Corn Ethanol
from Cellulose
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Benefits to agriculture

• Puts in farmers pockets
• Keeps jobs on the farm and in the community
• Represents a living example of sustainable
  development
• Eliminates the need for straw burning (certain
  soil zones)

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Commercial plant rollout What are the site
evaluation criteria?

• Assess commercial/country risk using factors such
  as
• Feedstocks
• Type, availability, cost, ease of collection
• Government Policy
• Tax situation, fuel mandates, financial
  incentives
• Infrastructure Issues
• Water availability/cost, road network, rail,
  power and natural gas price
• Investment Climate
• Tax rates, industrial development incentives,
  financing options
• Ethanol Co-Product Sales
• Off-take customers, refinery locations, market
  proximity

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2007 Construction start targeted

• Pursuing a disciplined Front End Development
  Process
• Staged commercial and technical milestones
• Working closely with Shell
• Straw procurement underway
• 320 contracts (382,000 t/yr) in place

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?
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A commercial biorefinery will look like

• Project Data
• 350 M project cost
• 500,000 t/yr feedstock
• 30 million gal/yr production
• Associated power plant and enzyme plant

• Project Developer
• Iogen
• Shell Global Solutions
• Lead Equity Investors
• Royal Dutch/Shell
• Iogen Energy

• Lead Candidate Locations
• Idaho
• Saskatchewan
• Alberta

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The US Energy Policy Act of 2005 aggressively
pursues cellulose ethanol

• 7.5 billion gallons of renewable fuel by 2012
• A 1 billion loan guarantee program
• 80 non-recourse loan guarantee for first four
  plants up to max of
• 250 mm/plant
• A 2.51 trading ratio for cellulose ethanol
• 250 million gallon minimum annual required volume
  of cellulose ethanol beginning in 2013

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The Presidents 06 State of the Union Address
put wind in the sails of the 05 Energy Policy Act

• Keeping America competitive requires affordable
  energy. Here we have a serious problem America
  is addicted to oil, which is often imported from
  unstable parts of the world.
• We will also fund additional research in
  cutting-edge methods of producing ethanol, not
  just from corn but from wood chips, stalks, or
  switch grass.
• Our goal is to make this new kind of ethanol
  practical and competitive within six years.
  Breakthroughs on this and other new technologies
  will help us reach another great goal to replace
  more than 75 percent of our oil imports from the
  Middle East by 2025.
• - President Bush, Jan. 31 State of the Union
  Address