VERBIO Vereinigte BioEnergie AGPresentation

Potsdam 12.12.2007

Fabian Hahn von Burgsdorff,

VERBIO AG

Introduction

Markets

Biodiesel / Bioethanol

2nd Generation

Strategy

Conclusion

3

Current Group Structure

Verbio Vereinigte BioEnergie AG

Energy

[Picture]

MUW NUW

Biodiesel

[Picture]

MBE NBE

Bioethanol

Transport and logistics

Others

Swiss BioEnergy AG (SBE)(1)

(1) SBE procures feedstock and executes sales of finished products on behalf of group entities. SBE also provides engineering services to Verbio

Wind

Biogas

4

Leading Biofuels Producer in Europe

European Biofuels Companies (Current Positioning)

(Current Nominal Production Capacity in ‘000 tonnes)

Positioning

Only integrated biofuels producer operating in Europe

Size confers advantages:

– Relationships with “Blue Chip” customers

– Improved economies of scale

– Involvement in political / regulatory process

Publicly Traded European Peers German Peers (>150k t/a)(Current Nominal Production Capacity in ‘000 tonnes)

Verbio is a leading pure play in both the European and German biofuels markets

(2)

(1)

Bioethanol Biodiesel

(2)

(6)

(4)

(3) (7)

(3)

(4) Operational capacity of 32,000 t/a expected Autumn 2006(5) Includes nominal capacity of 40,000 t/a (50,000m3/a) in France and 9,000 t/a (11,

500m3/a) in a 50:50 JV in Hungary(6) NEW Natural Energy West GmbH (owned by Bunge, Agravis, Diester, and C.

Thywissen); does not include further capacity expansion in Neuss (Germany) of 20,000 t/a for 2006 (VdB)

(7) Company to install further 150,000 t/a capacity (Neuss) in 2006 (VdB)

Source: Verband der Biodieselhersteller (VdB) estimates as of 31 May 2006 and company data

(1) Includes 290,000 tonnes non-EU production capacity(2) Majority owned by ADM; includes production capacity of Oelmühle Leer

Connemann (Leer) with a capacity of 125,000 t/a (acquired 1987)

(3) Biopetrol is currently expanding its production capacity by 200,000 t/a (Rostock) and should start production = 4Q 2006

(5)

5

Group History

2000

April

Sale of oil mill stake(1)

Begin MUW Biodiesel plant planning, including application for subsidies

November

Begin MUW construction (135,000 t/a transesterification)

2001

August

Start of MUW trial operations

October

First Biodiesel production in accordance with regulatory norm

2002-04

March 2002Founding of MBE (first German Bioethanol plant)

May 2003Founding of NBE (Bioethanol plant at Schwedt refinery)

June 2003Begin MBE plant construction (100,000 t/a)

October 2003Founding of NUW (Biodiesel plant)

January 2004Begin NBE plant construction (initially 100,000 t/a)(2)

Mid-2004Start-up of MUW esterification(3)

(16,000 t/a)(2)

Second Half 2004Increase of MUW capacity to 200,000 t/a

2004-Present

Sept-Dec 2004

Start of MBE and NBE trial operations

February 2005

Begin NUW plant construction (200,000 t/a)

Jun-Aug 2005

Start ramp-up of MBE capacity

Start of first NBE production line

Start of NUW trial operations

November 2005

First NUW delivery to Schwedt refinery

May 2006Start of second NBE production line (100,000 t/a)

Foundation of Verbio (700,000 t/a)(2)

1995-1999

1994

Start of Biodiesel trading (2,000 t/a)

1995

Start Biodiesel plant feasibility study

First contact with Dr. Pollert

1996

Construct oil mill(1)

Expand Biodiesel trading ~20,000 t/a(2)

More than ten years successful project development and operations(1) 50% Verpachtungsgesellschaft mbH (Santo family) participation; (2) Data is nominal (nameplate) capacity; (3) [Definition of

esterification to come]

6

CAGR 2000-05 2005-10Diesel 5.4% 2.4%Gasoline (1.9%) (1.9%)

800

1.000

1.200

1.400

1.600

1.800

2.000

2000 2001 2002 2003 2004 2005

Gasoline Diesel

Trends in EU Fuel Consumption

Observations

Western European gasoline consumption is in decline, whereas diesel is increasing

– Price differential (tax driven)

– Quieter, cleaner

– More fuel efficient

Less-developed southern economies growing faster than those of the North

– E.g. Spain, Portugal, Turkey

European supply-demand imbalance

– Surplus gasoline (export to USA)

– Diesel and jet fuel deficit (expected supply shortage of diesel refinery capacity in Europe)

EU Transport Fuel Consumption

Selected EU Consumption (2005)

(in billion tonnes)

(in million tonnes)

Source: Frost & Sullivan data and estimates

22,725,1

19,1

7,8

18,1

24,9

13,810,9

32,129,2

Germany France Spain Italy United Kingdom

Gasoline Diesel

Introduction

Markets

Biodiesel / Bioethanol

BtL Fuels

Strategy

Conclusion

8

Worldwide Transportation Fuel Demand (2005): 1,583 million tonnes oil equivalent

Diesel 38%

Gasoline58%

4%AlternativeFuels

Large Potential Biofuel Market

Worldwide Alternative Fuels Demand for Transport

Source: United Nations Framework Convention on Climate Change (UNFCCC) (Nov 2005)

Greenhouse Gas (GHG) Emissions (1990-2003)

Source: Hart World Refining and Fuels Service

Agriculture Energy Industry Transport

(13%)

(8%)

(1%)

23%

(28%)

Industry Process

Agriculture

Transport

Energy Industry

Waste & Others

The below chart summarises % change in

CO2 emissions in the EU-15 (1990-2003):

9

Conclusion

Grain

Crude Oil

Ethanol

Price

Time

In this Situation it is impossible for European Biofuel-producers to compete against Ethanol made of sugarcane or B99 from USA

• prices for wheat and vegetable oil increased much faster than crude mineral oil

Oilseed

Biodiesel

Introduction

Markets

Biodiesel / Bioethanol

2nd Generation

Strategy

Conclusion

11

Political milestones

- EU Biofuel Directive

- CO2 reduction of transport sector

- Security of supply

- Solution for agricultural surplus

12

Biodiesel and bioethanol = first generation biofuel

13

Biofuels Value Chain

Feedstock Production Finished Product Customers

Logistics

Trading

Road, river, rail, pipeline and storage

Feedstock, oils and finished product

Biodiesel

Vegetable oil seeds:

Rape seed

Soya

Sunflower

Recycled vegetable oil

Refining (oil mills)

Esterification

Glycerine refining

Methanol recovery

Oil majors

Third party traders

Gasoline stations

Fleet (truck, bus)

Food, healthcare and pharma

Direct substitute to mineral diesel:

B5 (5% diesel blend)

Higher blend for fleets (B30, B100)

Bioethanol

Grain milling

Fermentation and distillation

Rectification

Liquid/solid separation

Oil majors

Third party traders

Gasoline stations

Grains/other biomass:

Rye

Wheat

Barley

Maize

Sugar Cane/Beet

Octane enhancer and petrol substitute:

E5 (5% gasoline blend)

E85 (85% flex-fuel cars)

E50

14

Current Situation for Biodiesel

- 5 mio. production capacity of biodiesel in Germany

- max. 1,5 mio. for blending in B05

- Further increment of tax at 01.01.2008

- thereby till 2008 3,5 Mio. t excess production

- subsidized import B99 from USA/ against WTO

- less export opportunities

3,81,8 1,92,6

5,26,6

7,99,1

12,110,3

8,56,9

5,33,7

2003A 2004A 2005E 2006E 2007E 2008E 2009E 2010E

EU-15 Forecast EU Target

EU Biofuels Consumption

Target(1): 2.0% 2.75% 3.5% 4.25% 5.0% 5.75%

Biodiesel – Target vs. Forecast(in million tonnes)

(1)(2)

26.7% CAGR '05-'10(1)

EU Biofuels Consumption

15

EU Biofuels Consumption

Current Situation for Bioethanol

- 700.000 t production capacity for Bioethanol

- 2007 1,2% obligatorily blending in petrol = max. 280.000 t

- 2008 2% obligatorily blending in petrol = max. 460.000 Tons

- import of Brazilian ethanol

- sustainability?

Source: Frost & Sullivan, F.O. Licht, EU Directive 2003/30/EC(1) Based on EU target biofuels market share (by energy content). Assumes equal penetration of transport diesel and gasoline by Biodiesel and Bioethanol, respectively.

Underlying diesel and gasoline forecast is as per Frost & Sullivan(2) As per F.O. Licht Bioethanol consumption forecast

5,54,84,23,5

2,10,60,4 2,8

3,04,0

5,06,0

6,97,8

2003A 2004A 2005E 2006E 2007E 2008E 2009E 2010E

EU-15 Forecast EU Target

EU Biofuels Consumption

Target(1): 2.0% 2.75% 3.5% 4.25% 5.0% 5.75%

Bioethanol – Target vs. Forecast(in million tonnes)

(1)(2)

(1)(3)

21.1% CAGR '05-'10(1)

16

Feedstock:

Demand:

Biggest European fuel marketCompletely open market

Feedstock:

Demand:

Existing market for Bioethanol Mandate since 1 Jan 2006 for Bioethanol

Feedstock:

Demand:

Internal systemQuota system

Feedstock:

Demand:

Good sea logistics for refineriesRefinery capacity (#1 in Europe)Quota systemNo feedstock for Biodiesel and Bioethanol - buyers’ market only

EU Biofuels Market Landscape

France

Germany

Italy

Sweden

Source: Coceral (Brussels, Jun 2006), Frost & Sullivan (1) Biodiesel feedstock is rape seed, sunflower seed and soya beans(2) Bioethanol feedstock is soft wheat, drum wheat, corn, rye and triticale

(in million tonnes, 2005 figures)

(in million tonnes, 2005 figures)

(in million tonnes, 2005 figures)

(in million tonnes, 2005 figures)

(in million tonnes, 2005 figures)

Feedstock:

Demand:

Good sea logistics for refineries Narrow market (Repsol & Cepsa)Free biofuel systemFull de-taxation

Spain & Portugal

17

Feedstock:

Demand:

Large grain surplus for Bioethanol Small transport fuel market with limited demand

Feedstock:

Demand:

Good logistics, incl. seaPossibility to supply Nordic region via Rostock

Feedstock:

Demand:

Good logisticsLarge grain surplus for Bioethanol (maize and wheat)Limited fuel marketSingle refiner in market MOL

Feedstock:

Demand:

No market regulation yetRape and wheat for Bioethanol and Biodiesel Sub-optimal logistics

Feedstock

Demand:

Good logistics and feedstock for BioethanolSmall transport fuel market

EU Biofuels Market Landscape (Cont’d)

(in million tonnes, 2005 figures)

Poland

Hungary Other CEE Countries (6)

Balkan Countries (5)

Nordic Region(4)

(in million tonnes, 2005 figures)

(in million tonnes, 2005 figures)

(in million tonnes, 2005 figures)

(in million tonnes, 2005 figures)

Source: Coceral (Brussels, Jun 2006), Frost & Sullivan(1) Biodiesel feedstock is rape, sunflower and soya beans(2) Bioethanol feedstock is soft wheat, drum wheat, corn, rye and triticale(3) Last available gasoline consumption figure as of 2004(4) Includes Finland, Denmark, Latvia, Lithuania, Estonia (5) Includes Serbia, Croatia, Bosnia, Macedonia and Albania(6) Includes Czech Republic, Slovakia, Slovenia, Romania and Bulgaria(7) Includes only Czech Republic and Slovakia

(3)

(3)

Introduction

Markets

Biodiesel/Bioethanol

2nd Generation

Strategy

Conclusion

19

2nd Generation

- ethanol from lignocelluloses

- BtL

- NExBTL

- Hydrotreating

20

BtL-Biomass to Liquid

Carbonisation

Gasification

Liquefaction

21

BtL-Fuels

Raw Materials for synthetically diesel-production

Straw Wood Residual Wood from industry Residual Wood from forest

4 t Biomass = 1 t Syn. Diesel

But remember

2,4 t Grain = 1 t Bioethanol

2,5 t Rape = 1 t Biodiesel

22

BtL-Fuels what is public known

Raw - material Supply:Demand of Biomass for a sigma facility: 1.000.000 t

250.000 t/a biofuel capacity

Annual increment of Biomass in

Forest 2 - 3 t/ha Straw 5 - 6 t /haenergetic wood 8 - 10 t/haaverage 5,5 t/ha

This requires ca. 180.000 ha acreage or 1.800 km2 or twice the city of Berlin

- Investment 800.000.000 Euro (Tom Blades VDI 19.10.2007) (biodiesel 70 Mio; Ethanol 110 Mio)

- Biofuel not competitive with 1st generation

- Earliest availability 2015

Introduction

Markets

Biodiesel/Bioethanol

2nd Generation

Problems & Strategy

Conclusion

24

Inconsistent Discussion

- EU biofuel targets in volume

- CO2 reduction is not evaluated

- Security of supply Brazil vs. Europe

- still 10% setaside - food vs. fool

- deforestation for biofuel production

25

First StepsProduction of Ethanol grain

► Actual Rey production

for food

f. ex. Rey

Starch concentration 57 %

requires fertilization

= 150 kg N / ha

Yield Bioethanol

380 l / t Rey

Prospective Grain production

non food grain

f. ex. Rey

increment of Starch concentration to 60 %

- 15% less fertilization

= 22,5 kg less N / ha

Yield Bioethanol

400 l / t Rey

150.000 ha contracted Production secures short logistics and high quality

26

Production of Bioethanolclassical procedure

Consumer

Byproducts/ Animal Food

RefineriesFilling stations

BioethanolProductionRaw materials

27

EnergyEthanol

5,92

Energy demandEthanol-

Production

NettoEnergy

-2,14

3,78

100%

64%

Only 64 % CO2 – Efficiency

High requirements of Primary Energy

Ökobilanz ~ 30 % Getreideerzeugung + ~ 70 % BioethanolproduktionDDGS: Bewertung Allokationsverfahren auf Basis Energiegehalt

Production of Bioethanol Classical process

Net.-Energy and Energy requirement in kWh / l Ethanol

28

Production of Bioethanol Optimized process with integrated Biogas production

consumer

Feed

RefineryFilling Station

BioethanolproductionRaw materials

VERBIO - Biogas

Fertilizer

Energy

29

Production of Bioethanol Optimized process with integrated Biogas production

Energy content Ethanol

Energy demandEthanol-

Production

-1,00

1,41

Net.-Energy and Energy requirement in kWh / l Ethanol

5,92

Biogas-Production

Net. Energy content

+ surplus

+0,41

No external energy required!

No further exhaust of CO2 / l Ethanol

Futtermittel: Bewertung Allokationsverfahren auf Basis Energiegehalt

30

In Comparison classical Bioethanol production integrated with VERBIO Biogas

Energy Ethanol

-1,00

5,92+0,41

Energy Ethanol

5,92

Energy requirementsEthanol-

Production

Netto-Energy

-2,14

3,782,14

1,41

Biogas-Production

Netto-Energy

Net.-Energy and Energy requirement in kWh / l Ethanol

Energy requirementsEthanol-

Production

31

Conclusion CO2- Reduction VERBIO-Biogas process

reduced CO2 in g / l Ethanol

Ethanol production

Biogas production

259

39

326

fertilization

624 g CO2 / l

reduced

624 g CO2//l – Reduction compared to classical Bioethanol production

32

Erroneous Trends

Food and Fuel: Biofuels Could Benefit World’s Undernourished

“Decades of declining agricultural prices have been reversed thanks to the growing use of biofuels,” says Christopher Flavin, president of the Institute. “Farmers in some of the poorest nations have been decimated by U.S. and European subsidies to crops such as corn, cotton, and sugar. Today’s higher prices may allow them to sell their crops at a decent price, but major agriculture reforms and infrastructure development will be needed to ensure that the increased benefits go to the world’s 800 million undernourished people, most of whom live in rural areas.”

Biofuels for Transport, undertaken with support from the German Ministry of Food, Agriculture, and Consumer Protection, assesses the range of “sustainability” issues the biofuels industry will present in the years ahead, ranging from implications for the global climate and water resources to biological diversity and the world’s poor. The book finds that rising food prices are a hardship for some urban poor, who will need increased assistance from the World Food Programme and other relief efforts. However, it notes that the central cause of food scarcity is poverty, and seeking food security by driving agricultural prices ever lower will hurt more people than it helps.

World biofuels production rose 28 percent to 44 billion liters in 2006, according to the figures compiled since research on Biofuels for Transport was completed; fuel ethanol was up 22 percent and biodiesel rose 80 percent. Although biofuels comprise less than 1 percent of the global liquid fuel supply, the surge in production of biofuels in 2006 met 17 percent of the increase in supply of all liquid fuels worldwide last year.

This rapid growth is having unintended impacts. Large-scale biofuels production can threaten biodiversity, as seen recently with palm oil plantations in Indonesia that are encroaching on forests and edging out the endangered orangutan population, worrying European consumers who have begun importing palm oil from Southeast Asia. In Brazil, the Cerrado, a vast landscape of biologically rich forests, brush, and pasture just south of the Amazon, is coming under pressure as sugar cane cultivation expands.

“Current biofuels production methods place a heavy burden on land and water resources, due in part to the fossil fuel- and chemical-intensive corn that is used to produce over half the world’s ethanol,” says Hunt. “Farming practices need to be reexamined if agriculture is to provide energy as well as food for a rapidly growing global population that is hungry for both.”

“Farming practices need to be reexamined if agriculture is to provide energy as well as food for a rapidly growing global population that is hungry for both.”

33

Food versus Biofuel

2006 Forecast 2007

Grain demand Ethanol production

2007

EU27 258.450.000 t 278.405.000 t 3.500.000 t

EU31 272.321.000 t 293.591.000 t 3.500.000 t

USA 363.200.000 t 335.600.000 t 55.000.000 t

China 371.600.000 t 382.900.000 t

World 2.015.200.000 t 1.974.800.000 t

Quelle: USDA, COCERAL, ACTI, 2007

Introduction

Markets

Biodiesel

Bioethanol

2nd Generation

Strategy

Conclusion

35

Conclusion

- not 1st vs. 2nd generation – 1st and 2nd generation

- biodiesel and bioethanol are available, proven technologies

- food vs. fuel? Not really!

- land efficiency? FAO report!

- high potential of CO2 effects for 1st biodiesel and ethanol

- sustainability directive !!!!

- security of supply / Evaluation of GHG – reduction

36

A Powerful Vision

“The last tree will die for biofuels.”

(Fidel Castro maximo leader 2005)

Thank you for your attention