Essen, January 2007 - Tecnicelpa · MAN Ferrostaal Seminário Bioenergias, Tomar 30 Mar 2007 1> Company & Business Selected References Gasification & BTL Strategy Conclusions MAN

MAN Ferrostaal Seminário Bioenergias, Tomar 30 Mar 2007 1>

Company&

Business

Selected References

Gasification & BTL

Strategy

Conclusions

MAN FerrostaalAktiengesellschaft

Essen, January 2007

Wolfgang MarschewskiBusiness Unit Renewables

(Forestry, Pulp & Paper, Biofuels)

MAN Ferrostaal AG

“Innovative Technology for Biomass Gasification

and possible Applications”

Tecnicelpa - Seminário “Bioenergias. Novas Tendências”Tomar, 30th March 2007


Company&

Business

Selected References

Gasification & BTL

Strategy

Conclusions


Contents

MAN Ferrostaal: TTMC II Methanol plant in Trinidad&Tobago

MAN Ferrostaal: Pulp plant in Stendal/Germany

IntroductionThe MAN GroupMAN Ferrostaal AGOur business model

Selected Project ReferencesMethanol plantsPulp Mills

Gasification & BTL StrategyBiofuelsCHOREN GasificationPresent StatusThe way to go, opportunities

Conclusions


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Business

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Gasification & BTL

Strategy

Conclusions


The MAN Group

MAN is one of Europe’s leading engineering groups. As a systems provider employing some 58,000 peoples in its core areas of

Commercial VehiclesIndustrial ServicesDiesel EnginesTurbomachines

MAN operates in 120 countries of the world.

The MAN Group ranks among the top three suppliers in each of its markets and is a technological leader.

MAN’s blue-chips shares are listed in the DAX30.

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General contractor / lead managerProject development and managementFinancingProduct off take

Function

Oil & GasPower plantsPetrochemicalsMetallurgyRenewables (Pulp & Paper, Biofuels)- also with KSH Solutions Inc./CAN

Industries

Activity Design, planning and supply of turnkey industrial plants and systems

MAN Ferrostaal AGProject & Contracting – Industrial Projects

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I IIIProject-Development

Project-Development O & MO & MEPC - ContractingEPC - Contracting

General Contractor / Leader of international Consortiums

Project - & Risk - Management

Taylor made Project - Financing

Project-ConceptProject-Concept

Operation &MaintenanceOperation &Maintenance

Project-FinancingProject-Financing

Basic / DetailEngineering

Basic / DetailEngineering

Global Procurement

Global Procurement

Civil & ErectionCivil &

ErectionCommis-sioning

Commis-sioning

• World wide general contractor of turnkey industrial plants

• Project development & project management as core competences

• Equity participation in selected cases

II

Industrial ProjectsCore Competence General Contractor

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Gasification & BTL

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Industrial ProjectsCore Competence Project Development

MAN FERROSTAAL Project Development Concept:“Turning ideas into reality”

• Development of profitable business idea

• Close Cooperation with strategic investor

• Leadership throughout developmentprocess

Selection of sponsors:

• Financiers

• Feed stock supplier

• Product off-take

• Operator

• Technology

• Engineering

• Customized financial solutions

• Strategic Investment

• Limited risk, transparency and efficiency of financial model

Optional:

• Establishment of project company

• Participation in the equity

• Participation in O&M

• Participation in feedstock supply and off-take

• General con-tractor for delivery of industrial plant

• Turnkey Fixed Price

• Schedule & Performance Guarantees

• Sale of equity to:

• Strategic investoror

• Financial Investors

Business Idea Contracting structure

Financialengineering

Equityshareholding

Realization ofthe plant Exit Phase

61 2 3 4 5

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Gasification & BTL

Strategy

Conclusions


Industrial Projects Project Financing (e.g. Methanol Plants)

State Approvals(inter alia)

• Central Bank • Local Permission• Implementation Permit• Operational Permit• Environmental Permit• Fiscal Incentives

ECAs

Transportation• Contracts, Facilities

• Lump Sum Turnkey Agreement• Performance Bond• Liquidated Damages• Complying with Environmental

Standards (local and international)

EPC-Contractor Ferrostaal

Fully operational plant side

Location

• Long Term Contract

Experienced Operator

Plant Management & Operation

• Long Term Contract• Favorable Prices• Safety Reserve

Feedstock Supply

Shareholder´s Liquidity Buffers

• Take-or-pay obligations

Off-Take Agreement(s)

Off-Shore Escrow Account • Operating Accounts• Debt Service Reserve Account

ECA-covered Debt about 2/3

• Pre-completion support• Post-completion support

Shareholders‘ Equity about 1/3Strategic Interest

Project Company

LegalAdvisor

InsuranceAdvisor

TechnicalAdvisor Trustees

Legal Advisor

Insurance Advisor

Technical Advisor

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Gasification & BTL

Strategy

Conclusions


Selected ReferencesSelected References


Company&

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Selected References

Gasification & BTL

Strategy

Conclusions


TTMC II – Trinidad & Tobago Methanol Company

Industrial Projects ReferencesMethanol Plant – Pulp Mill

Stendal Pulp Mill / Germany Turnkey Kraft pulp mill incl. power station, auxiliaries, fresh & wastewater treatment, etc.

EPC-Budget: ~ 720 Mill. EuroStaff employments: ~ 600Construction works: 2002 – 2005 Capacity: 550,000 t/a NBSK

Turnkey methanol plant;

Partner: Davy Process Technology Ltd.Total investment cost: ~ 250 Mill $Capacity: 550,000 t/a MethanolExecution: 1994 - 1996

Selected References


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Gasification & BTL

Strategy

Conclusions


Industrial Projects ReferencesPulp mill (e.g. Kunda/Estland)

Capacity: 140,000 t/a BCTMP (Aspen)EPC-Budget: 135 Mill. EuroGeneral Contractor: MAN Ferrostaal AG / RWE Industrie-Lösungen GmbH In operation: April 2006

AS Estonian Cell / Heinzel Group / Larvik Cell

Selected References


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Selected References

Gasification & BTL

Strategy

Conclusions


Gasification & BTL*

Strategy

*BTL = Biomass to Liquids

Gasification & BTL

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Comparison of Biofuels

Crop Yield (oil equiv.)

litres/hectar

CO2-Balance

Net Reduction

(WTW-basis)

Biodiesel / FAME1st – Generation

Rapeseed

Palm Oil (Asia)

1408

> 5000

- 46 %

Bioethanol1st – Generation

Grain

Sugar cane (Brazil)

1660

4197

- 27 %

- 80 %

Bioethanol2nd – Generation

(Ligno)cellulosicBiomass

640 (residual straw)

> 4000 (plantation wood)

- 85 %

BTL / Sundiesel2nd – Generation

all sorts of biomass

(wood predominately) 3907 - 88 %

Gasification & BTL

Strategy

Source: FNR – Fachagentur Nachwachsende Rohstoffe e.V.


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Climate change caused by GHG emissions is a major driver for BTLsupport in the European Union’s energy and environmental policy

BTL is considered a desirable contribution to future transportation concepts due to very favourable fuel specs (in contrast to FAME-Biodiesel):

less CO2-emissionssulphur-freenearly free of aromatic hydrocarbonszero emission of particulate matterlow NOx-emissionsadjustable product quality (octane and cetane number) BTL is compatible with existing infrastructure and enjoys highestinterest in automotive industry

Green fuel image is important also to MAN as one of the leading companies in automotive industry for commercial vehicles

Advantages of BTL Biofuels

Gasification & BTL

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Gasification & BTL

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How to produce BTL Sundiesel

Gasification & BTL

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Milestones in “XTL” Fischer-TropschHistory

”XTL” may either be Coal to Liquid, Gas to Liquid, or Biomass to Liquid

1923

1930/40s

1950s+

1980s

1990s

2000+

Fischer-Tropsch synthesis (FTS) invention (Mülheim/D).

First CTL-plants with FTS in D (e.g. Ruhrchemie).

First CTL-plants with FTS at Sasol, Sasolburg/SA,Followed by additional plants / capacities.

GTL-plants with FTS in by Petro SA in Mossel Bay/SA, by Shell in Bintulu/Malaysia, by Exxon (AGC-21) in Baton Rouge/USA.

First BTL-pilot scale demonstration (Alfa plant) by Choren in Freiberg/D. Large scale GTL-facilities in Ras Laffan/Qatar under construction. Semi-commercial BTL demonstration (Beta plant) in 2007. Further BTL-projects (Sigma plant) under preparation.

New large CTL-capacities (FTS) at Sasol in Secunda/SA.

Gasification & BTL

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Thermal-Chemical Conversion from solid Biomass to synthetic Biofuels

Efficiency (@ 200.000 tpa)Biomass Handling Gasification Gas Cleaning + Upgrading Synthesis + Upgrading Total

~ 97-98 % ~ 65-83 % ~ 92 % ~ 69-71 % ~ 45-55 %

Hydrocracking

Distillation

Blending

Investment structure (@ 200.000 tpa)Biomass Handling Gasification Gas Cleaning + Upgrading Synthesis + Upgrading Utilities

~ 6 % ~ 28 % ~ 14 % ~ 25 % ~ 28 %

BiomassLogistics Storage

O2-GasificationSteam GasificationFlash-Pyrolysis

AutothermalAllothermal

Fixed BedFluidized BedEntrained FlowCombinations

BiomassGasification

Raw Gas SynGasCleaning +Upgrading

Tar Separation

Desulphurization

PM Separation

Cooling/Heat Recovery

CO-Shift -> H2/CO

CO2-RemovalPSA

Compression

SynGasBiomassHandling

Milling

Separation

Drying

BiofuelSynthesis

MeOH-Synthesis

NT-Fischer-Tropsch

HT-Fischer-Tropsch

Bio-SNG

Hydrogen

(MTBE, ETBE, DME)

BiofuelProduct Make-Up

Gasification & BTL

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Gasification & BTL

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CHOREN’s process for BTL production

Fischer-Tropsch & Hydrocracking

Carbo-V® Gasification(Two-Stage-Gasification)

Syngas Treatment(Cooling, Scrubbing, Shift)

CHOREN is the only BTL developer covering the entire process chain, starting with Biomass and ending up with Sundiesel.

Gasification & BTL

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βα

+ process fully proven in pilot scale, industrial scale at β plant already partly incommissioning, i.e. large scale reference available

+ multiple train concept offers redundancy and therefore entails increased overall availability

+ broad variety of biomass feedstocks can be applied to the system+ access to Shell‘s Synthesis and product off-take is secured

- Relatively complex gasification process, i.e. hardly economically feasible with „low tech“applications but best for high sophisticated applications (syngas for biofuels)

- Multiple train concept (low pressure) means a higher effort and therefore cost in termsof equipment, but significant advantage of higher availability for “new” technology

+

-

1 MW-α pilot plant in operation since 1998 (gasification), with Fischer-Tropsch-Synthesis (FTS) since 2003.

50 MW-β BTL demonstration plant with FT-Synthesis currently under construction. Sundieselproduction to start in late 2007.

Status of CHOREN‘s Carbo-V® gasification

Pro’s and Con’s

Gasification & BTL

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CHOREN‘s Carbo-V® gasification

Low-TemperatureGasifier (NTV)

High-TemperatureGasifier

Gas-Cleaning + Upgrading

Syngasfor use

Bio-Coke

Gas (containing tar)

Biomass15% H2O

Synthesis gas

Steam

Scrubber

SewageWater

Bed Ash Pellets(elute-resistant)

Raw Gas(tar-free)

Air/Hydrogen

Heat Exchanger

DedusterCoke, Ashes, Dust

Gasification & BTL

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Energy flow diagram (Beta Plant)

Gasification & BTL

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Business approach towards BTL

Gasification & BTL

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Stages of technological development

Gasification & BTL

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World’s first industrial BTL facility

Gasification & BTL

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Roadmap for BTL realization in Germany

* Dena = German Energy Agency

Gasification & BTL

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Biomass potential for up to 20 % of the current and > 35 % of future transportation fuel demand in Germany

Production cost in first large scale plants < 1 EUR/Litre, mid term expectation < 0.70 EUR/Litre competitive with 1st generation biofuels

Construction of a first industrial reference plant (500 MW scale) asap

Risk share between all stakeholders

Public support via loan guarantees and reliable boundary conditions (tax incentive)

Results and recommendations of a recently finished “BTL Realization Study” (Dena*-Study)


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BTL “Sigma Plant” concept

Gasification & BTL

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Thermal processes(ovens, kilns for calcination etc.) available

availableBio-Power generation (indirect co-combustion, gas engines, gas turbines, IGCC)

demo phase today,great futureopportunities!

Bio-Syngas to Biofuel Synthesis

Ia

IIIb

Different applications encompassing the novel gasification technology are characterized by different maturity and risk.

Approach towards BTL can either be direct (path II) or indirect (path Ia+Ib). The latter may be advantageous to hedge technical risks with respect to special situation / requirements e.g. of pulp industry.

Approaching BTL indirectly via further applications for gasification processes

Carbo-V® gasification

Gasification & BTL

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Germany Portugal South East Asia

Revenue: SunDiesel 0,80 €/ltr. 0,60 €/ltr. 0,52 €/ltr.Revenue: Naphta 0,40 €/ltr. 0,30 €/ltr. 0,26 €/ltr.

Costs: Biomass 65,00 €/t 30,00 €/t 16,00 €/t

Project IRR 11,45 % 11,52 % 11,54 %Equity IRR 14,58 % 14,59 % 14,60 %

Comparison of costs and revenues of a BTL-facility in different countries

Target: Comparable Project- and Equity-IRRBasis: Plant capacity 200.000 tpa SunDiesel, same boundary conditions

Variables: Revenues for SunDiesel & Naphta and Biomass costs

Total Investment Costs Total Sales Revenues Total Cash Operat ing Costs - including Biomass Costs

Gasification & BTL

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Conclusions

Biofuels will gain increasing importance. The emerging business offers a tremendous opportunity for construction and operation of industrial biofuel plants.

Only synthetic biofuels like BTL / Sundiesel or 2nd generation Bioethanol can significantly contribute on the long run, since a broad variety of biomass can be applied.

Especially the pulp industry does have excellent prerequisites to participate in the emerging biofuel business.

Gasification technology is one of the key technologies. CHOREN industries is far ahead of this competition in terms of BTL.

MAN Ferrostaal is Your partner as a general contractor both in terms of pulp technology and biofuels!

Conclusions


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intointo RealityRealityTurningTurning IdeasIdeas

Please contact us!

MAN FERROSTAAL AGHohenzollernstrasse 24

D - 45128 Essen

Business Unit Renewables(Forestry, Pulp & Paper, Biofuels)

Wolfgang Marschewski

Tel.: +49 – 201 – 818 2210Fax: +49 – 201 – 818 3931

http://www.manferrostaal.com

Thank you for your kind attention !

Documents

Essen, January 2007 - Tecnicelpa · MAN Ferrostaal Seminário Bioenergias, Tomar 30 Mar 2007 1> Company & Business Selected References Gasification & BTL Strategy Conclusions MAN