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Cellulosic Hydrocarbon Fuels from IH2 Technology – Fuel Quality Celeste McLeod CRI Catalyst Company 910 Louisiana Houston TX 77002Celeste McLeod, CRI Catalyst Company, 910 Louisiana, Houston, TX 77002
LARTC Presentation10 April 2013
Disclaimersc a eThis presentation contains forward-looking statements concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results,expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statementsexpressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘goals’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’, ‘‘seek’’, ‘‘should’’, ‘‘target’’, ‘‘will’’ and similar terms and phrases There are a number of factors that could affect the future operations of Royal Dutch Shell and couldsimilar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this presentation, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative fiscal and regulatory developmentsdeveloping countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions. All forward-looking statements contained in this presentation are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on f d l ki t t t Additi l f t th t ff t f t lt t i d i R l D t h Sh ll’ 20 F f thforward-looking statements. Additional factors that may affect future results are contained in Royal Dutch Shell’s 20-F for the year ended December 31, 2011 (available at www.shell.com/investor and www.sec.gov ). These factors also should be considered by the reader. Each forward-looking statement speaks only as of the date of this presentation, 10 April 2013 Neither Royal Dutch Shell nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this presentation.p g p
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Discussion Topicsp
• Introduce Gas Technology Institute (GTI) and CRI Catalyst (CRI)(GTI) and CRI Catalyst (CRI)
• IH2 Technology overview
• IH2 Technology product quality
• IH2 process economicsp
• IH2 Technology integration sugar/ethanol
• IH2 commercial deployment
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Gas Technology InstituteGas ec o ogy st tute
• Not-for-profit gas research & services organization with a 70+ year history• Capabilities that span the natural gas value chain• Current focus in diversified energy solutions• Facilities
– 18 acre Chicago campus – 28 specialized labs totaling 200,000 ft2
• Staff of 250 >1 200 patents• >1,200 patents
• 750 licenses granted & 500 products taken to market
Pil t S l G ifi ti C E & E i t l T h l C t
Offices& Labs
CRI is the partner for IH2
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Pilot Scale Gasification Campus Energy & Environmental Technology Center
CRI Catalyst CompanyC Cata yst Co pa y
• Catalyst Business with 50+ year history
• Houston based global business – Houston– London– Singapore
• Research Facilities Amsterdam– Amsterdam
– Bangalore – Houston
f• Manufacturing Facilities – US (3)– Germany – Belgium
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What is the IH2 Process?
• IH2 processCatalysts Hydrogen & Heat– Catalysts, Hydrogen & Heat
– Cost-effectively converts wide variety of biomass
– Directly produces hydrocarbon “drop in” fuels (R100) and/or high quality blend stock (>R50)
• IH2 Technology offers integration opportunities – Refinery, paper mill, ethanol plant,
agricultural, or recycling operations – Creates higher value from biomass
than afforded by heat and electrical power sales (NA basis)
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electrical power sales (NA basis)
IH2 Process (Simplified, Stand Alone) Process
( p , )
Biogenic CO2Feed
Products
HDO’d Vapors
4) SMR C1‐C3 GasRenewable H2
Di till d
Hi Pressure Steam
Crop Residue
City Waste
2) Fluidized Bed
Proprietary Catalyst
Renewable H2
3) Fixed Bed
Proprietary Catalyst
Renewable H2
Distilled Hydrocarbon
Clean Water
Wood/ForestResidue
Gasoline, Jet and Diesel Range HCs
340‐470C<500psig
1st Stage 2nd Stage
370‐400C<500psig Fertilizer
Energy Crops
Algae
1) Feed ConditioningSizing , Drying & Feeding
BioChar
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IH2 Transformative Differentiators
• Fungible, high purity hydrocarbon fuel and/or blend stock productsstock products
• Nearly carbon neutral*
• Feedstock flexible w/ high product yields – 67-157 US gallons/US ton
• Attractive economics – ~ $2/gal; 500 dry MT/day wood; USGC– Low capex (4 major process steps, low pressure, non corrosive)– Low opex (feedstock predominates)
E th i ith 72% 86% bi• Exothermic process with 72% - 86% bioenergy recovery (wood)
• Market Ready! Combination of Available Technologies
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*>94% GHG reduction per Professor David Shonnard at MTU: http://services.lib.mtu.edu/etd/THESIS/2012/ChemicalEng/maleche/thesis.pdf
Evolution of IH2 Technologygy
Gasoline Product 3rd Gen Catalyst
Advanced catalysts improve product, Wood Example
Total Liquid Product 2nd Gen Catalyst Lab Scale
Total Liquid Product 1st Gen Catalyst Lab Scale
Gas/Jet/Diesel Product 3rd Gen Catalyst Lab Scale
Pilot Plant Scale
HydrocarbonHydrocarbon
Jet/Diesel Product 3rd Gen Catalyst Pilot Plant Scale
WaterWater
Water Product 3rd Gen Catalyst Pilot Plant Scale
4Q09 “R5” Quality 3Q10 “R25” Quality 2Q12 “R60+” Quality
“GOAL“ “GOAL“ Drop InDrop InStand Stand Alone Alone “R100”“R100”
Process & Catalyst R&D Continues
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R100R100
Comparison of Liquid Quality from Woody BiomassBiomass
Pilot plant Laboratory unit
% Carbon 88.20 88.40% Hydrogen 11.60 11.00
% Sulfur 0.02 0.02% Nitrogen <0.10 <0.10% Oxygen BDL BDL% Oxygen BDL BDL
Total acid number, mg KOH/g <0.05 <0.05
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IH2 Liquid Product Quality(Wood)
• 3rd generation gasoline– Gasoline Meets ASTM D-4814-10b
unleaded gasoline specificationsunleaded gasoline specifications– R100 RBOB Quality Economy &
Intermediate U.S.– Evaluating EU split v EN-228
• 3rd generation diesel– Passed all D-975-11 as No 2, general , g
purpose middle distillate fuel as R100– Except Cetane Index & Viscosity– Diesel aromatic, currently ~R50 Target
R100R100– Diesel (whole algae) likely R100 (in testing)– Evaluating EU split v EN-590
LA options for IH2 hydrocarbons: internal consumption or export
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LA options for IH hydrocarbons: internal consumption or export
IH2 Process Economics (USGC) NREL 09/12 Basis( )
29.6
Wood $71.97/dry ton
Other Op Costs: Catalyst,
Operating Costs Total $1.64/gal*4.7
17.7
Feed
1st Stage/2nd Stage
Installed Equipment Costs $127.5mln
91.31
2.14
17.3
5.9 Disposal, etc. Fixed Cost
Depreciation
Avg Income Tax
Avg ROI
4.0
55.02 8
2.8
40.5 Fractionation
HMU
Ammonium Sulfate
Absorption/Stripping
Utilities & Contingency
• Stand Alone/Green Field (US Gulf Coast basis)• 2000mt/d wood (50% moisture fed, dried to 10% moisture at 1st stage)Installed Equipment
Total Capital Investment $263mln
7.8 Avg ROI
*Includes $0.1884/gal coproduct credit
2.8 Utilities & Contingency @ 35%
• 60% financed at 8% interest, overall 10% IRR• Feed Stock ~55% of Operating Cost• No subsidies, tax, RIN or carbon credits included!• Minimum Fuel Selling Price – $0.433/L (2007) $0.476/L (2012)
R fi S /R fi H S l
127.5116.5
Costs
Land/Develop
Permits & S/U
Standard Project Add-In's**
** Prorated Expense (10%), H O & Construction (20%), Field Expense (10%), Working Capital (10%) , Project Contingency (30%)
• Refinery Synergy w/Refinery H2 Supply• Reduces TIC ~55.0MM$ • Estimated MFSP $0.359/L (2007) $0.394/L (2012)
• KBR FEL-3 underway• Opex validated by prospective clients
6.313.2
Add In s
• Opex validated by prospective clients
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Sugar/Ethanol Important Latin American Region
• ~38% World Sugar Cane (SC)• Brazil, Colombia, Argentina known SC Ethanol Producers; Guatemala, Jamaica,
Costa Rica, El Salvador export SC Ethanol
A P d ti P d ti it % f W ld
• Residual materials – Bagasse, Cane Trash, Filter Cake, Spent Wash, Molasses• Next Generation Biofuels – Brazil • IH2 w/Sugar/Ethanol Cellulosic Hydrocarbon
CountryArea Production Productivity % of World
Production(million ha) (million tons) (Tons/ha)
Brazil 5.343 386.2 72.3 29%India 4.608 289.6 62.8 22%
China 1.328 92.3 65.5 7%
Thailand 0.97 64.4 66.4 5%
Pakistan 1.086 52 47.9 4%
Mexico 0.639 45.1 70.6 3%Colombia 0.435 36.6 84.1 3%
Australia 0.423 36 85.1 3%
USA 0.404 31.3 77.5 2%
Philippines 0.385 25.8 67.1 2%ppIndonesia 0.35 25.6 73.1 2%
Cuba 0.654 22.9 35 2%South Africa 0.325 20.6 63.4 2%
Argentina 0.295 19.2 65.2 1%Myanmar 0.165 7.5 45.4 1%
Bangladesh 0.166 6.8 41.2 1%
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gWORLD 20.42 1333.2 65.2 100% Sugar Cane Production Data & Sugar Cane Growth Region Map http://www.sugarcanecrops.com/
IH2 Integration w/ Sugar/Ethanol
Sugar/Ethanol plant 160 t/hr SugarcaneExcess Bagasse: 41.8 t/hr; 147854t/yr*
Cogeneration
*Material Energy Balance provided by J.P.Mukherji Associates Pvt. Ltd. – India~150 days Operation, Bagasse @50% Moisture
IH2gSteam Electricity34.5 – 65 GW/yr**
Hydrocarbon & Steam*** Electricity
32.1 MML Hydrocarbon/yr** Location, Cogeneration Equipment Efficiency, Steam T P Distribution Losses etc impact final
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Steam T, P, Distribution Losses, etc. impact final GW available for sale to Grid *** 72% - 86% bioenergy recovery
IH2 Integration w/ Sugar/Ethanol High Level Evaluation C ti IH2Cogeneration
Steam Electricity34.5 – 65 GW/yr**
IH2
Hydrocarbon & Steam*** Electricity
32.1 MML Hydrocarbon/yr** Location, Cogeneration Equipment Efficiency, Steam T P Distribution Losses etc impact finalSteam T, P, Distribution Losses, etc. impact final GW available for sale to Grid *** 72% - 86% bioenergy recovery
• IH2 Liquid hydrocarbons benefit v Cogeneration
$40 00
$45.00
Bagasse Conversion Cogeneration v IH2 Hydrocarbon
• IH2 Location specific– Commodity Price– Conversion – Efficiency
IH2 C it l MFSP$20.00
$25.00
$30.00
$35.00
$40.00
mat
ed M
M$/
yr
– IH2 Capital MFSP
• IH2 Hydrocarbon Only• IH2 Feed Flexible
– Other Sugar/Ethanol $-
$5.00
$10.00
$15.00
Estim
residues – Local Alternative Feeds
World bank – gasoline base prices by country Business week – Electricity prices by country 08/12
IH2 Hydrocarbon @ Resale 75% of Retail IH2 Hydrocarbon @ Resale 50% of Retail Low - Electricity to Grid High - Electricity to Grid
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y p y y* Brazil has since reduced electricity price per KWH Average - Electricity to Grid
IH2 Technology Deployment• Bench Scale
– 02/2009 @ 0.5kg/hr
gy p y
• Pilot Scale– 02/2012 @ 50kg/d– Confirmed bench scale results
Fuels for EPA Registration– Fuels for EPA Registration– Fuels for ASTM Evaluation– Gasoline (wood) is R100
Pre Commercial Scale• Pre Commercial Scale– BDEP for 5mt/d cellulose done – 1st demonstration license awarded 12/2012, more expected
C i l S l• Commercial Scale– KBR is CRI’s exclusive basic engineering partner– FEED 500 & 1000mt/d wood (FEL-2 complete, FEL-3 underway)– Full Scale Deployment Target Q1 2014Full Scale Deployment Target Q1 2014
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Commercial Timeline, Current StatusCo e c a e e, Cu e t Status1Q10
2Q10
3Q10
Process Variables and
Semi-Continuous
Lab ScaleDemo Scale Units Only (11 units)
(Brownfield Construction; Date Basic Engineering Starts)Full
CommercialPilot Scale
Wood, 5-1000mt/d 3Q10
4Q10
1Q11
2Q11
3Q11
Continuous Operation
Construct 50kg/d Pilot Plant
Receive Unit
Crop Residues, 5-10mt/d
Micro Algae, 5mt/d
Mixed Paper/OCC/Urban Wood, 5mt/d
4Q11
1Q12
2Q12
3Q12
4Q12
Continuous Pilot Plant Operation
Shake Down
1Q13
2Q13
3Q13
4Q13
1Q14 5
mt/d
500
mt/d
100
0m t/
d
Today
y 5
mt/d
gin
5m
t/d
1Q14
2Q14
3Q14
4Q14 Construction
Basic/Detailed Engineering
FEL-
3 C
ompl
ete
FEL-
2 C
ompl
ete
FEL-
2 C
ompl
ete
FEL-
2 U
nder
wa y
FEE
D S
et to
beg
3/28/2013 17
Technology is:– Cost-effective process developed by GTI using CRI proprietary
catalystsConverts biomass directly to hydrocarbon fuels and/or high quality
Technology is:
– Converts biomass directly to hydrocarbon fuels and/or high quality blend stocks
– Self-sufficient & self-sustaining w/ little lasting environmental impact, needs only transport in/outneeds only transport in/out
– Feedstock flexible– Nearly carbon-neutral – Integrated for potentially improved economics– Currently in FEED (FEL-2/-3) for multiple feed demonstrations– Available exclusively from CRI Catalyst Companyy y p y
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Assumptions, Credits, References ssu pt o s, C ed ts, e e e ces
1. Slide 3 Image credit: <a href='http://www.123rf.com/photo_10846628_a-group-of-illustrated-3d-people-are-arranged-in-a-circle-around-the-words-let.html'>iqoncept / 123RF Stock Photo</a>
2. Slide 6 Image credit: <a href='http://www.123rf.com/photo 14316634 the-big-question-silberblau.html'>styleuneed / 123RF Stock Photo</a>S de 6 age c ed t a e ttp // 3 co /p oto_ 3 663 _t e b g quest o s be b au t sty eu eed / 3 Stoc oto /a3. Slide 8 Transformative Differentiators *>94% GHG reduction per Professor David Shonnard at MTU:
http://services.lib.mtu.edu/etd/THESIS/2012/ChemicalEng/maleche/thesis.pdf4. Slide 8 Image credit: <a href='http://www.123rf.com/photo_12407917_butterflies-from-the-chrysalis.html'>kamonrat / 123RF Stock Photo</a>5. Slide 11 – Hart Energy’s international Fuels Quality Center – Sulfur Limit World Graphs for Diesel and Gasoline6. Slide 12 IH2 Process Economics (USGC) NREL 06/11 Basis http://www.osti.gov/bridge/servlets/purl/1059031/1059031.pdf7. Slide 13 - According to the Renewable Fuels Association, Jamaica, Costa Rica and El Salvador are respectively the second-, third- and fourth largest g p y g
exporters of fuel ethanol to the US. The region began exporting ethanol to the US under the Caribbean Basin Initiative, which allowed tariff-free exports of ethanol up to 7 percent of US ethanol production.
8. Slide 13 Data & Sugarcane Map via http://www.sugarcanecrops.com/9. Slide 13 Sugar Cane Photograph By Rufino Uribe (caña de azúcar) [CC-BY-SA-2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Wikimedia
Commons10. Slide 14 Maximize Returns w/ IH2 Integration Sugar/Ethanol Material Energy Balance provided by J.P.Mukherji Associates Pvt. Ltd11 D t A ti d f Slid 15 M i i R t / IH2 I t ti S /Eth l11. Data Assumptions used for Slide 15 Maximize Returns w/ IH2 Integration Sugar/Ethanol
– http://www.businessweek.com/articles/2013-02-07/brazils-cheaper-electricity-comes-at-a-cost - Electricity Prices– http://data.worldbank.org/indicator/EP.PMP.SGAS.CD/countries?display=default – World Bank Gasoline Prices by Country (2010)– http://www.eia.gov/petroleum/marketing/monthly/pdf/pmmgraphic.pdf -- Discount Resale Gasoline Price U.S. Used to Adjust World Bank Values to Resale taken
at 75% of Retail based on U.S. reduction retail to resale taken from eia data. – Conservative estimate for IH2 hydrocarbon value was taken at reduced rate of 50% of retail for each country – http://www.bls.gov/data/inflation_calculator.htm CPI Inflation Calculation taken at 106% conversion 2010 to 2013$ – Economic benefits included are for illustration only. Further economic evaluation should be conducted on a site specific basis.– Electricity conversion was estimated based on Mass Balance provided by J.P. Mukherji Associates Pvt. Range of electricity conversion was assumed based on
internal values for conversion . Low end total GW produced assumed an 80% efficiency and high end assumed no losses. Estimated electricity price applied to calculation for the Low scenario assumed 80% of the retail electricity price was the selling rate per KWH back to the grid. High scenario assumed the selling rate per KWH was the same as retail price.
12. Slide 14 &15 electricity pylon Image credit: <a href='http://www.123rf.com/photo_9268750_electricity-pylon--tower-with-fluffy-white-clouds-and-blue-sky-background.html'>peteg / 123RF Stock Photo</a>
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Thank You Gracias & ObrigadaThank You, Gracias & Obrigada
Learn more at www.cricatalyst.com
3/28/2013 20
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