Biofuels Future. Jennifer Holmgren UOP LLC. EESI Briefing - Biofuels May 12, 2009 Washington D.C.

Macromarket Summary: Through 2015 Global energy demand is expected to grow at CAGR 1.6%. Primary Energy diversity will become increasingly important over this period with coal, natural gas & renewables playing bigger roles. Fossil fuels are expected to supply 83% of energy and 95% of liquid transportation needs Biofuels are expected to grow at 8-12%/year to ~2.0 MBPD Key: Overlaying Sustainability Criteria on Alternatives (GHG, water etc.) Source: IEA, 2008

Petroleum Refining Context Crude Oil Crude Treating & Desalting Latest Refining Technology Development & Licensing Atmospheric Gas Oil Crude Oil Distillation (Topping) Light Ends Light Naphtha Naphtha Light Distillates Heavy Distillate Vacuum Distillation Environmental Controls H 2 Isomerization H 2 Naphtha Hydrotreating H 2 Heavy Distillate Hydrotreating H 2 Gas Oil Hydrotreating Gas Processing Unit Butane- Butylene Isomerate LPG Light Olefins Production Solvent Extraction & Deasphalting Vacuum Resid Coking Energy Conservation & Management (Power Production) Gas Oil Plant Maintenance/ Reliability/ Safety Alcohol Etherification Catalytic Reforming H 2 Light Distillate Hydrotreating Fluid Catalytic Cracking H 2 Hydrocracking Butane H 2 Visbreaking Plant Upgrades & Revamps Alkylation Flue Gas Aromatics Production Isobutane Natural Gas Gas-to-Liquids BTX Reformate Sulfur Plant Iso-octane Production Alkylate Distillates Iso-octane and Heating Oil Gasoline Gasoline, Naphtha, Middle Distillates, Gasoline Kerosene and Jet Fuels and Heating Oils Lube Oil Production Heavy Fuel Oil Asphalt Gasification Lube Oils Natural Gas, Fuel Oil Hydrogen Production/ Purification/Recovery Fuel, Wax H 2 Massive Scale Technology Evolution Expected Product Treatin ng Blending Sulfur Fuel Gas Gasoline Jet Fuels LPG Solvents s Heating Oils Geases Fuel Oil Lube Oils Asphalts Syngas/Steam Electricity Coke Refining: ~100 years ~750 refineries ~85M BBL of crude refined daily ~50M BBL transport fuels Complex but efficient conversion processes Feedstock provider to the global petrochemical industry Established infrastructure for blending, distribution and traded globally

Our Biofuels Vision Produce real drop-in fuels Leverage existing refining/ transportation infrastructure to lower capital costs, minimize value chain disruptions, and reduce investment risk Focus on path toward second generation feedstocks Oxygenated Biofuels Hydrocarbon Biofuels Ethanol Biodiesel Jet Gasoline First Generation Other Oils: Camelina, Jatropha, Halophytes Second Generation Natural oils (vegetables, greases) Lignocellulosic biomass, algal oils

Getting There Lignocellulosic Technology Distributed Standards Algal Efficiency i Supply Chain Reduction in Climate Active CO 2 Equivalents Biofuels Sustainability Cost Sustainability Uncompromised Product Quality Life Cycles Net Energy Production Consumption Emissions World Trade Feedstock Availability Vehicle Fleet Energy Content

Biofuel Targets Targets Region Current Future Brazil 25% Ethanol in China Europe gasoline 2.0% of diesel by 2008 2.0% of gasoline & diesel by 2010 5.75%* of gasoline & diesel by 2010 5.0% of diesel by 2011 8.0% by 2020 per year Gallo ons per acre 700 600 500 400 300 200 Biodiesel Production from Oils Source: Fulton et. al India 10.0% Ethanol in E20, B20 by 2017 Ethanol Production from Sugars gasoline 10%* by 2020 USA 15.2 B gal 2012 36 B gal by 2022 * Energy content basis (~20% of transport pool) 20% Substitution Equivalent to the Land Mass of ~CA, IN, NV, MI e per year llons per acr Ga 100 0 Soybean Caster bean 700 600 500 400 300 200 100 Sunflower seed Source: Fulton et. al Rapeseed Jatropha 0 Barley Wheat Corn Sugar Beet Palm Sugar Cane 84 70 56 42 28 14 0 52.5 35.0 17.5 0 Million BTU/a acre Million BTU/a acre

Gallo ons per acre Enablers for a Sustainable Biomass Infrastructure MBP PD Source: Purvin & Gertz / Ei Eric Larsen: Energy for Sustainable Development, 2000 50 40 30 20 10 0 Current Global Oils Productivity Liquid Transport Fuels Gasoline Cellulosic Waste Potential 3500 Source: Fulton et. al 455 500 400 300 200 100 0 Soybean Caster bean Sun- flower seed Rapeseed Jatropha Palm Algae 70 56 42 28 14 0 Million BTU/acre MBPD 14 12 10 8 6 4 2 0 Current US Liquid Transport Fuels Gasoline Cellulosic Waste Potential Cellulosic waste could make a significant ifi contribution ti to liquid transportation pool. Algal Oils could enable oils route to biodiesel, and Jet. Increases Availability, Reduces Feedstock Cost Technology Breakthroughs Required

Camelina: Key Attributes Initial Camelina Market Current markets Northwest US and Southern Canada Wide-spread acreage as rotation crop > 200 million gallons by 2012 in the US Future Camelina Market Low input oil seed crop (member of mustard family) Rotation crop with wheat Can grow on marginal land Cost: $0.40-$0.70 per gallon less than soybean and palm oil Native to Northern Europe More than 3,000 years old: used as lamp oil in Greece and Rome

Alternative Biofuel Crops Pongamia Castor Lesquerella Oiticia Euphorbia Crambe Crop One crop does not fit every location, but there is at least one crop for every location Oil Year (gal/acre/year) Pongamia 500 Not characterized Cultivation (M Acres) Advantages as Oil Crop Leguminous plant that does not require nitrogen fertilizer. Integrates well with other land usage such as grazing. Oiticia (Licania) 88 16 Widely cultivated in Brazil for biodiesel. More saturated fatty acids than many other natural oils. Euphorbia (gopher sponge) 53 26 Produces oil both in seed and as latex in leaves & stem, nonedible, toxic Castor Bean 42 32 No-edible oil due to toxins, oil mainly used for industrial purposes. Non-edible Lesquerella 23 61 Grows naturally in arid and semi-arid landscapes and is native to areas in the southwest United States and Mexico. Similar oil to castor but no toxins. Low maintenance crop. Non-edible Crambe 19 74 High C 22 content in oil. Non-edible

Biofuels Overview: Technology Pathways Feedstocks = UOP Areas Products Sugars Starches Lignin, Cellulose & Hemicellulose C 6 Sugars Enzyme Conversion Fermentation C 5 / C 6 Sugars Acid or Enzyme Hydrolysis Direct Conversion Pyrolysis/Thermal Depolymerization Lights Gasification Dehydration CO 2 Hydrotreating Fischer Tropsch - Alcohol Synthesis Ethanol Distiller s s Grain Renewable Energy Gasoline H 2 O /Jet Natural Oils 2 nd Gen Feeds (Jatropha, Camelina & Algal) Co-Feed FCC Hydrotreating Transesterification Glycerine FAME or FAEE Current biofuel market based on sugars & oils. Use bridging feedstocks to get to 2 nd Generation Feeds: Algae & Lignocellulosics

UOP Renewable & Jet Processes Fuels use existing infrastructure, can be transported via pipeline, and can be used in existing automotive and aviation fleet Fuel Excellent blending component, enabling expansion of diesel pool by mixing in bottoms Jet Fuel Initially a DARPA-funded project to develop process technology to produce military jet fuel (JP-8) from renewable sources Extended to commercial aviation in collaboration with Boeing Performance Comparison DARPA Project Partners Commercial Airline Partners Petrodiesel NOx Baseline -10 to 0 Cetane 40-55 75-90 Freeze Point Flash Point Jet-A Specs SPK <-57 C -63.5 > 38 C 42.0 Cold Flow Heat > 42.8 Baseline Excellent Properties Content MJ/kg 44.0 Oxidative Stability Baseline Excellent JFTOT (260) pass

Completed Flight Demonstrations Successful ANZ Flight Demo Date: Dec. 30 2008 Feedstock: Jatropha oil Successful CAL Flight Demo Date: Jan. 7 2009 Feedstock: Jatropha and algal oil Successful JAL Flight Demo Date: Jan. 30 2009 Feedstock: Camelina, Jatropha and algal oil

Pyrolysis Oil to Energy & Fuels Corn Stover P P Refin nery P P Electricity Production Available Today Biomass Fast Pyrolysis P P Pyrolysis Oil Fuel Oil Substitution Mixed Woods Transport Fuels (Gasoline, Jet ) Chemicals (Resins, BTX) 3 Years to complete R&D Conversion to Transport Fuels Demonstrated in Lab Collaboration with DOE, USDA, PNNL, NREL

Scope of WTW* LCA Petroleum Based Fuels Distillate from Waste Tallow Distillate from Energy Crops Seed Fertilizer Fuel Chemicals Extraction of Crude Oil Waste Tallow from Meat Processing Industry Tallow Processing Oil Processing Energy Crop Farming Energy Crop Transport Oil Extraction Plant Oil Transport of Crude Oil Tallow Transport Hydrogen Oil Transport Hydrogen Refining Renewable Jet Renewable Jet Process Unit Process Unit Gasoline, Jet,, Jet, Jet Consumer Consumer Consumer Use Use Use *WTW is either well-to-wheels or well-to-wings

Life Cycle Analyses for MJ (Input) )/MJ (Output) 1.6 14 1.4 1.2 1 0.8 0.6 0.4 0.2 0 Cumulative Energy Demand Jatropha Non-renewable, Fossil Renewable Biomass Renewable, Water Camelina Tallow Soy eq./mj g CO 2 Non-renewable, Nuclear Renewable, Wind, Solar, Geothe 90 80 70 60 50 40 30 20 10 0 house Gases Jatropha Cultivation Fuel Production Use Camelina LUC Error Bar Tallow Oil Production Transportation Soy 5000 4000 3000 2000 1000 0-500 eq./mj g CO 2 Significant GHG Reduction Potential

Summary Renewables are going to make up an increasing share of the energy pool - Fungible biofuels are here - Essential to overlay sustainability criteria i (GHG, water) Feedstock availability is an important enabler - First generation biofuels, though raw material limited, are an important first step to creating a biofuels infrastructure. Bridging feedstocks are key - Second generation feedstocks, cellulosic waste and algal oils, are on the horizon - Diverse feedstock initiatives iti are enabling regional sustainable solutions Important to promote technology neutral and performance based standards and directives to avoid standardization on old technology. Portfolio of Options Enabled by a Robust Supply Chain