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Special Board Meeting March 20, 2009 Keith Pauley [email protected] 800-611-2296 x81 Chemical and Environmental Technologies Health and Life Sciences Advanced Engineering Systems www.matricresearch.com Life-Changing Research and Innovation Europa

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Special Board MeetingMarch 20, 2009

Keith [email protected]

800-611-2296 x81

Chemical and Environmental Technologies

Health and Life SciencesAdvanced Engineering

Systemswww.matricresearch.com

Life

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EuropaMATRIC 2

About MATRIC

MATRIC was formed from the downsizing of over 2000

research scientists and engineers located at the Dow Chemical Technology Park,

WV from 2001-2009

US-based contract research and development corporation formed in 2004Research staff of 85 and engineering staff of 65 (total of 150 technical staff)– 33 PhD-level researchers– 19 professional engineers– 25+ average years of technical experience– 2 members of US National Academy of

EngineeringMATRIC performs high value-added, fast-paced, market-driven research, development and engineeringMATRIC focuses on developing intellectual property in the form of new processes and products

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MATRIC’s United States Headquarters

Dow Chemical Technology Park

– Facility opened in 1949– 30,000 patents; worth

US$18B– 681 acres– Over 800,000 sf of

research and engineering buildings

MATRIC facilities– 32 chemistry and life

science laboratories– 16 pre-manufacturing

pilot plants

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MATRIC Laboratory BuildingMATRIC Pilot Plants

MATRIC Engineering Building

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MATRIC Enterprise

Non‐Profit R&D 

Corporation

For‐Profit Commercial R&D 

Corporation

Holding Company to Commercialize IP

Full Service Professional 

Engineering Firm

Technical Consulting 

Firm

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European offering of the MATRIC Enterprise

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MATRIC/MCR Business Areas

Chemical and Environmental TechnologiesBusiness Area

Health and Life Sciences

Business Area

Advanced Engineering

Systems Business Area

Biomass Fuels and ProductsBiodiesel developmentCorn ethanol developmentCellulosic ethanol developmentBiomass gasificationBiomass digestionBio-polymers

Fossil Fuels and ProductsCoal to LiquidsCoal GasificationIntegrated Gasification Combined CycleCoal to ChemicalsOxyfuel CombustionGreenhouse gas emissions controlCoal rail car de-icer

Environmental TechnologiesCarbon dioxide captureWater purificationNatural gas purification (nitrogen, carbon dioxide, sulfides)Selenium and metals removalNuclear remediation

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Chemical and Environmental Technologies Business Area

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Health and Life SciencesAgricultural Sciences

– Genomic research on crop species (cotton, tomatoes, peppers)

– Species selection and testing for land remediation

– Biofuels species selection (oil, ethanol)Medical Device Development

– Devices and systems that enhance patient treatment and healthcare capabilities (both diagnostic and therapeutic)

Cellular and Immunological Research– Stem cell, T-cell and aptemar studies for

cancer, diabetes, and Sjorner’s diseasePharmaceutical Support

– Analytical and clinical trials support– Statistical process enhancement

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MATE Capabilities and Skills

Detailed Engineering– Process engineering– Control system engineering– Electrical system engineering– Mechanical engineering– Civil engineering– Drafting

Procurement– Major equipment– Minor equipment– Bulk material

Construction Management– Construction oversight– Process Representation

Operations Training and Start-up– OSHA training– Process operations training– Plant process start-up support

Project Management MATE 9

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Overall Research and Engineering Enterprise

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Utilize the entire MATRIC Enterprise to produce value for European manufacturers and governments– Focus on Energy and Environment

• Alternative energy and energy efficiency• Green chemistry and REACH compliance (solvent substitution,

biodegradable materials, biomass products)• Process intensification (micro-reactors)

– Partnerships with API (Italian manufacturers association) and other European trade associations

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MATRIC’S REACH OFFERING

It deals with the Registration, Evaluation, Authorization and Restriction of Chemical substances.

The new law entered into force on 1 June 2007. REACH has been developed in a climate of transparency and consultation.

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REACH

• Most significant body of chemical regulation to be enacted in more than 20 years.• Estimated to involve 30,000 chemicals and many of the

products that contain them.Chemical industries are one of the largest manufacturing industries in the European Union (EU) directly employing 1.9 million people.In 2004, the European chemicals sales amounted to $800 billion. (Those of the U.S. totaled $566 billion.)Chemical exposures are a major cause for concern for many Europeans, particularly those from Scandinavian countries.

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Existing European Chemical Regulation

Patchwork system involving – 60 lawsPrimary law (EC 793/93) was enacted in 1981 and created a two tier system.– For 100,000 existing chemicals, no testing was required– For new chemicals ( >10 kg), substantial testing is required.

Broadly perceived by Europeans as having serious weaknesses.

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REACH Legislation

Introduces legislation and mandatory data requirements for new and estimated 30,000 existing chemicalsTransfers responsibility for risk assessment from government to the manufacturers and importersIntroduces authorization and restriction procedures for the most hazardous chemicalsProvides greater transparency and public access to informationEstablishes a new European Chemicals Agency

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Underlying REACH Policy: The Precautionary Principle

1. When human activity raises threat of harm2. to human health or environment3. precautionary measures should be taken,4. even if some cause and effect relationships are not

fully understood.

Shift burden to industry to “prove safe”

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REACH Implementation

Dec. 2006: REACH was passed by both the European Parliament and the European CouncilJune 2007: REACH entered into forceJune 2008: European Chemicals Agency became operational. It is located in Helsinki, Finland and is anticipated to eventually have a staff of 450.June – Nov. 2008: Pre-registration of existing substances.Nov. 2010: Registration deadline for ≥ 1000 ton substances as well as carcinogens, mutagens, and reproductive toxicants produced at > 1 ton, and agents very toxic to aquatic organisms produced at > 100 tons.June 2013: Registration deadline for substances produced in ≥ 100 tons and substances toxic to the aquatic environment.June 2018: Registration deadline for substances produced in quantities of ≥ 1 ton.

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REACH Registration

Pre-Registration– For substances produced in quantities ≥ 1 ton per year, basic

information on the chemical, contact information, the anticipated production volume and registration deadline is to be provided to the new European Chemicals Agency (ECA).

Registration– For substances produced in quantities ≥ 1 ton per year, a

registration dossier is to be provided to the ECA. Based largely on volume, specific information about physicochemical, toxicological and ecotoxicological properties must be included.

– Individual downstream uses throughout the supply chain as well as the associated risk and safety measures must be provided.

– For chemicals ≥ 10 tons, a Chemical Safety Report must also be provided.

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REACH Evaluation and Authorization

Evaluation– Member states can check compliance and examine testing

proposals.– Member states may also examine dossiers to evaluate whether

a substance presents a risk to humans or the environment.Authorization– Required for substances considered to be CMR (carcinogenic,

mutagenic or reproductive toxicants), PBT’s (persistent, bioaccumulative and toxic), and vPvBs (very persistent and very bioaccumulative).

– Authorization granted if the manufacturer or importer is able to demonstrate that the risks can be adequately controlled. If not controllable, the chemical must be shown to have compelling socioeconomic benefits without suitable alternatives. A research plan is also to be submitted.

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Authorization/Substitution

Authorize after showing of “adequate controls”Where adequate control not possible, authorize only if:– no safer alternative exists; and– socio-economic benefits outweigh risks

MATRIC Europa focuses its efforts on working with manufacturers to assess and implement alternative chemicals within processes

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REACH Restriction

Restriction– If a risk is identified as inadequately controlled, a proposal

to restrict the use and marketing of a substance can be made by the Commission or a Member State.

– The final decision on authorization will be taken by the Commission, in consultation with the Member States.

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REACH Impacts

Estimated to involve 30,000 chemicals and most articles manufactured in Europe or imported into the EU.Direct costs: Best estimates range from ~USD 3.5 to 6.3 billion (<0.1% of sales; some estimates are projected to $50+ billion).Benefits: Hypothesized to prevent 4500 cancer cases per year with possible overall health savings of up to $50 billion over 30 years.

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MATRIC Europa’s REACH Program

Goal is ensure full compliance with REACH by manufacturers through the substitution of chemicals in processesFocus on redesign of manufacturing equipment to utilize authorized chemicals and minimize new capital investmentPartnership with Italian manufacturers association (API)– 60,000 members

MATRIC Europa is located in the Milan area and leverages both European and US chemical engineers

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