Profitable CO2 Capture

Arthur Middleton Hughes

Three methods to solve CO2

• 1. Cap and Trade – expensive and hard to sell.• 2. Capture and sequestration – highly

expensive. No profit. Electricity costs go up!• 3. Create forests in the desert – Big profits. No

increase in electricity costs. Government sets rules, but fully reimbursed for their efforts. Plantations are privately owned and financed.

Convert Deserts to Forests

Sahara – biggest in the worldNo law and orderUnstable PoliticallyNo company would invest here

Australia – Second Largest Desert - Law abidingAnxious to promote timberWilling to innovate

Australia Deserts

• 339 Million Acres – hot, dry, few residents• Government could acquire and lease to tree

planters.• Fresh water can be produced from the sea for

1/5 of a cent per gallon.• Water needed for a forest: 960,000 gallons per

acre. Net added water needed: 689,000 gallons• Tree plantations would pay for the water

Where are the world’s forests today?

Very few in Australia

Start with Demo: 8,000 acresAustralian Tree Plantation with 8,000 Acres of desert land over eight yearsInvestment $50,000,000

What Number Rate Years DollarsStaff 20 $50,000 8 $8,000,000Water 8,000 $1,378 8 $88,192,000Seedlings 8,000 $800 1 $6,400,000Fertilizer 8,000 $12.00 8 $768,000Power 8,000 $50.00 8 $3,200,000Miscellaneous 8,000 $100.00 8 $6,400,000Business Loan $50,000,000 7.00% 8 $28,000,000Taxes & Fees 8,000 $200 8 $12,800,0008 Year Costs $153,760,000Sales After 8 years 8,000 $8,000 8 $512,000,000Net Revenue $358,240,000Return on investment per year 17.91% $44,780,000

Typical Desalination Plant

Desalinaton

PlantPerth, Australia

20 Year Financial Plan for Desalination Plant Costs Per Year 20 Year

Investment (Stock Sale) $550,000,000 Cost to build $450,000,000 Pipelines $50,000,000 20 Year Running Costs $5,000,000 $100,000,000 Maintenance $2,000,000 $40,000,000 Taxes $2,000,000 $40,000,000 Total 20 Year $680,000,000 Revenue from water sale $110,240,000 $2,204,800,000 Net Profit $1,524,800,000

Pilot Tract

Life in Blue Woods• Residences, hospitals, police, fire

departments, schools, parks, recreation, sports, shopping centers, sewage, trash disposal, and other facilities to insure that these new forests meet the most modern and hygienic standards for workers and residents.

• Complete Blue Woods pilot area: 130 square miles.

• This will produce a big profit after eight years:

One town in the Desert Over 8 Years Price Quantity TotalOne time Sale of Lumber after 8 years $64,000 80,000 $5,120,000,000Cost of water over 8 years $1,378 80,000 $881,920,000Remaining cost per acre over 8 years $2,000 80,000 $1,280,000,000Salaries of tree planting staff for 8 years $50,000 200 $80,000,000Land Lease to Government per Acre $200 80,000 $128,000,000Profit to Tree Planting Companies $34,376 80,000 $2,750,080,000

Many years to convert all the desert

• After the pilot, add another.• Profits will attract many other investors, and

tree planters.• Desalination profits will lead to many more

plants being built.• Over next 30 years most of the desert will be

converted to profitable forests.

Eventual Results: $2 Trillion per year4 billion tons of CO2 captured per year

CO2 Capture can be very profitable

Number of Forest

Towns Acres

People Living There

Gallons of Water

(millions)

Tons of CO2

Captured (billions)

Sales of Wood

(Milions per year)

1 83,000 714 21,786 0.00104 $6403,267 261,360,000 2,332,638 71,387,560 3.39768 $2,090,880

How much CO2 needs to be captured?

Princeton Carbon Mitigation Initiative: Keeping emissions flat for 50 years will require trimming projected carbon output by roughly 8 billion tons per year by 2060

Australia forests will meet half this amount

What to plant? --Paulownia Trees$8,000 - $12,000Per Acre Per Year

After 8 years

What a ton of CO2 looks like

Huge world market for lumber

Questions: Which is best?

• Force people to stop burning greenhouse gasses (and raise taxes and prices)?

• Or plant trees in Australia (no new taxes or increased prices)?

• One will work. The other won’t.

Arthur.hughes@dbmarketing.com