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Reader Advisory and Disclaimer

The statements made in this presentation may contain forward-looking statements that involve risks and uncertainties, which may prevent

expected future results from being achieved. Forward- looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words “believe”, “anticipate”, “expect”, “estimate”, “project”, “will be”, “will continue”, “will likely result” or similar words or phrases. Forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from the forward-looking statements.

The Company cautions that actual future performance could be affected by a number of factors, including technological change, competitive factors, the success of research and development programs, our future ability to fund our operations and become profitable, competition, securing and maintaining corporate alliances, our ability to increase our customer base, the services that we or our customers will introduce and the benefits that end users will receive from these services; the impact of entering new markets, market acceptance of the Company’s products, the strength of intellectual property, financing capability, reliance on subcontractors and key personnel and other risks detailed from time-to-time in the Company’s financial statements and other information provided to shareholders. Forward-looking statements are made as of the date hereof, and the Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Therefore, future events and results may vary substantially from what the Company currently foresees.

This document describes a plan to build ancillary businesses to augment and complement an existing 16 megaWatts per

hour thermal electricity generating plant that will be converted to use sustainable, renewable biomass fuel, sited on land that will be owned by ecoTECH Energy Group near Thompson Falls, Montana.

The businesses to be added to operations are in the sustainable fresh produce, indoor, land-based food fish aquaculture and silviculture sectors. The power station and the ancillary businesses are being developed by ecoTECH Energy Group Incorporated, (“ECTH”) a Nevada corporation, a fully reporting public company, traded on the OTC:BB exchange under US SEC rules.

ecoTECH Energy Group Inc. (ECTH) is the developer and will be the majority owner of the power station.

Management, training and technologies will be provided by ECTH and its affiliates described herein.

Preface & Document Outline

© Copyright C. Victor Hall and ecoTECH Energy Group April 2011 All rights reserved

Document Contents

ecoTECH eco-Industrial Park, Thompson Falls MT Page Reader Advisory & Disclaimer (Opposite Page) f1Contact Information (Next Page) f2Power Station Acquisition Deal 1Overall Plan Explained: Changes Necessary 5ecoTECH Biomass Technology for the Plant 7Conversion Agenda 11Horticulture & Aquaculture 13The Horticulture Plan 16Total Natural Cycle Concept "Beyond Organic" 20Crops Planned 23Horticulture Economics 26The Aquaculture Plan 31Recirculating Aquaculture System 33Types of Fish Products Planned 38Aquaculture Economics 42Specialty Pebble Hydroponic Greenhouse 46History of Successful HydroNov Brand 47

ecoTECH Energy Group (Montana) Inc., of Butte, Montana (herein abbreviated as EEGM), is a wholly-owned subsidiary of ecoTECH Energy Group Incorporated.

ecoTECH Energy Group Incorporated, (trading symbol ECTH.OB) a Nevada corporation, is a fully reporting public company, traded on the OTC:BB exchange under US SEC rules.

ecoTECH Energy Group (Montana) Inc. (EEGM) is the developer of the project and ecoTECH Energy Group Incorporated will be the majority owner of the power station.

Management, training and technologies will be provided by ECTH and its affiliates described herein.

The BlueHawk Biomass CHP Energy Plant

and eco-Industrial Park

Thompson Falls, Montana.

ecoTECH Energy (Montana) Inc..

125 West GraniteButte, Montana 59701

Ph: 604 288-8263

Fx: 604 357-1363

ecoTECH Energy Group (Canada) Inc.

101 – 26633 Gloucester WayLangley, BC V2S 6E5

Ph: 604 288-8263

Fx: 604 357-1363

ecoTECH Energy Group Incorporated

800 Fifth Avenue, Suite 4100Seattle, Washington 98104

www.ecotechenergygroup.comwww.etwm.ca

www.ecophaser.cawww.ecogrow.ca

e-mail: [email protected]

www.hydronov.com

ecoTECH Energy Group Inc. has entered into an arrangement by memorandum of understanding to proceed to a contract to purchase the

buildings, equipment and land comprising a 16 MegaWatt per hour electricity power generating thermal station, near Thompson Falls, Montana.

The power plant is a former coal fuelled facility that was dismantled and moved from its original site in North Carolina, relocated to its current site, 4 miles southeast of Thompson Falls, and re-assembled, refurbished to as-new condition.

Unfortunately, the coal combustion design of the plant made it uneconomic for wood pellet (in lieu of coal) combustion and attempts to burn coal to the clean combustion standards in the environmentally sensitive Clark Fork Valley were unsuccessful, culminating in the closure of the plant pending the advent of a solution to its problems.

ecoTECH has the technologies to resolve the issues of efficiency, air emissions and energy wastage to ensure a turnaround to success.

Acquisition and revamp of an existing coal-fired power stationto a sustainable, wood fuelled generator of GREEN ENERGY

The plant has several shortcomings for today’s market and environmental climates. It is a single cycle, inefficient unit with high energy losses to a series of cooling towers, plus it has scrubbing and fuel handing equipment specified to accommodate a past-era travelling grate coal combustion bed.

However, ecoTECH has the ability to economically convert the combustion system, leaving the boiler and generating systems in situ. This will be achieved by the installation of three near-zero NOx super-efficient wood fuelled thermal sublimation reactors fitted with sonic standing wave oxidation (“ecoPHASER”) systems.

A heat conserving water recirculation system and a Thermax hot oil circuit will be installed to convert the station into a combined-cycle (CHP) heat and power station.

The hot oil circuit will feed remote radiators for kiln drying of wood at the adjacent sawmill (see next page), plus the planned heating for hydroponic horticulture and aquaculture systems described in the next section of this book.

The BlueHawk plan includes the full co-operation of the neighbouring sawmill. Under our mutual agreement, Thompson River Lumber (TRL) will

become a 5% equity partner in the project. TRL can (based on history) and will supply 100% of the fuel necessary for the CHP plant. In return, the CHP plant will supply all of the heat necessary (via the ecoTECH Thermax hot oil circuit) for remote steam generators that feed the drying and wood conditioning kilns at the mill.

As the kilns (like the base-load power station) operate 24 hours per day, this is a very satisfactory arrangement. Wood residues are shredded to 3” minus and fed to the ecoPHASER systems by conveyor.

An Integrated Deal

ecoTECH’s Thermax hot oil circuit uses high speed pumps to circulate oil through insulated small bore piping at up to 700 oF. The pipes are laid underground and can expect to tun up to a kilometre between pumping stations or radiators, which are used as heat sources for steam generators.

With a highly polluting power system, the essential add-ons, scrubbing, limestones and other acid rain prevention additives, scrubbers for particulate, toxic fly ash, mercury and lead, not to mention the incomplete capture of sulphur dioxide, high nitrous oxide releases, the purchase of mitigating green credits to stay in business; all become financially burdensome to the point of crippling the viability on old paradigm coal stations.

With a clean burning fuel and a state-of-the-art oxidation system, all of the pollutants and the mitigation equipment are eliminated, as are their attendant costs. The system becomes simpler and far easier to manage in all aspects, so most of the revamp is removal of surplus coal paraphernalia.

Less Is More.....

1. Cooling tower. 2. Cooling water pump. 3. Transmission line (3-phase). 4. Unit transformer (3-phase). 5. Electric generator (3-phase). 6. Low pressure turbine. 7. Condensate extraction pump. 8. Condensor. 9. Intermediate pressure turbine. 10. Steam governor valve. 11. High pressure turbine. 12. Deaerator. 13. Feed heater. 14. Coal conveyor. 15. Coal hopper. 16. Pulverised fuel mill. 17. Boiler drum. 18. Ash hopper. 19. Superheater. 20. Forced draught fan. 21. Reheater. 22. Air intake. 23. Economiser. 24. Air preheater. 25. Precipitator. 26. Induced draught fan. 27. Chimney Stack.

The Existing Coal Power System

Planned Revamped Power System

Bioenergy as defined by ecoTECH is the sublimation (gasifying solid wood, manure, or “energy” grasses with semi-pyrolytic, or starved-

air combustion), then pulsed oxidation of the liberated gas mixture with a high frequency flame oscillating via inducement of a sonic standing wave that impinges the recombination of the disassociated simple elements of combustion to prevent the formation of nitrous and other unwanted oxides, long chain hydrocarbons, dioxins and furans.

Prevention is certainly better than cure and a lot less expensive, so although the gathering and processing of forestry residues and mill wastes is labour intensive and costly, the overall costs in turning the fuel to usable energy are much less.

The Overall Project Description The Project comprises a cluster of businesses, with energy as the common link. Each is in a separate market sector, each provides many employment opportunities in a variety of skill-sets and for semi and unskilled workers. Each promises longevity of operation, very good profit margins and a healthily attractive return on investment. Aside from the exporting of power for sale to the electricity grid, there are two businesses that have long-time proven performance in the hydroponic and aquaculture food production industry sectors, and one that services a climate-change and pollution reduction awareness-driven, long term opportunity, for “greening” fossil-fuel power plants around the world. These businesses are described in the table on the next page (upper section).

Why BioEnergy is Better

BUSINESS DESCRIPTION OF OPERATIONS

ecoTECH W2E (Wastes to Energy) Combined Heat & Power (CHP) Generating Plant

Provides Sustainable ("Green") firm electricity to the gridand firm electricity, process heat and gases to on-sitebusinesses.

"ecoGROW" Hydroponic Mixed Crop Greenhouse, technology and training by HydroNov, Quebec

Essentially, a proven HydroNov "technology franchise",this facility will provide fresh produce to distribution hubs

into major cities in the region.HEAT POWER

CARBON DIOXIDE

"ecoGROW" Recirculating Water Raceway aquaculture facility: technology and training by HydroNov, Quebec

Essentially, a proven HydroNov "technology franchise",this facility will provide fresh whole fish and fillets to

distribution hubs into major cities in the region; (also

major brand national fish wholesalers for fillets).HEAT POWER

ecoTECH "Einstein Technology" cold store for above operations

Uses Einstein's heat exchanger technology to utilize the by-produced CHP plant heat to refrigerate produce andfrozen fish and an electric Advanced IQF tunnel flashfreezer for initial blast frrezing.

HEAT POWER

ecoTECH Roasted (or "torrefied") wood briquette manufacture.

Torrefied wood, emulates coal in typical pulverized coal-fed combustion systems, without coal pollution, as a fuelreplacement to meet the new statutory emissionreduction quotas and mandates in effect now.

HEAT POWERINERT HOT

GASES

SERVICES (products) from ecoTECH CHP PLANT

Of the above described businesses, only the torrefied briquette manufacture is speculative, in that it is dependent on the availability of

wood that is surplus to the amounts required for 24/7 operation of the BlackHawk Power Station.

The enormous numbers of infected dead and dying trees in the Pacific Northwest due to the Mountain Pine Beetle epidemic is expected to produce a glut of dead standing timber that will have to be dealt with. The logging industry refers to the 5 billion victims as “the red and dead”.

The high energy content in the pollution-free briquettes and the fact that coal burning power stations can deploy the briquettes as a direct replacement for coal at a savings over costs (pound for pound twice the energy of Montana coal); plus the costs of emissions scrubbing and buying green credits, adds up to a saving in production costs, not including the high maintenance and equipment consumables costs necessary for coal plants to meet modern emissions limits under law. Details of this product are available on request, (from ecoTECH).

The eco-Industrial Estate Power Station: Existing

Location Thompson Falls, MT

Equipment:

Boiler Babcock & Wilcox, Stoker Boiler

Steam Turbine Elliott Turbines 16.5 MW Nameplate

Cooling Tower Marley four cell double flow cooling tower

Design Capacity 16 MW

Market Area Pacific Northwest (Mid-C)

Fuel Woody Biomass

Design Heat Rate (HHV) ~12,900 Btu/kWh

COD: Estimate Q2 2012

Site Area Approximately 10 Acres

Electric Interconnection Northwestern Energy 115 kV substation

Transmission

10 MW of firm point-to-point transmission with

primary delivery points Hot Springs/Burke (Avista) or

Garrison (BPA)

Fuel Deliveries Truck transport from adjacent Sawmill (<20 miles);

Montana Rail Line link to site

O&M Provider PIC

• Planned greenhouses and aquaculture requires heatandpower.HighregionalsunshineindexforgreenhousePLUS a breakthrough LED species-spectrum specificlightingsystem foroptimumproductionwithminimumcosts is part of the horticulture and aquaculturebuildingsdesign.

• Percentage of Carbon Dioxide to be utilized bygreenhouse.

• CarbonCreditTrustcandidate.Thisprojectwillqualifyforcredits.

• On-siteheavyequipmentfabricationandassemblyplantcanprovidestructuralitemsatreducedcost.

• The entire site will operate year round and will becontrolled by a successful group of establishedoperating companies. Savings from the costs of heatandpowerwillensureongoingviability.

• Notreliantondeadstandingpine,ormillresidues*.

• No fuel transportation costs. No deliveries carbonfootprint.

• Firm(92%)powercontractpossibledue toequipmentcondition and modular heat energy generationequipmenteaseofswappingandmaintenance.

• ecoPHASERredundancyandcyclingreducesunitdutycyclesandguaranteeslongerequipmentlife.

• StateoftheartnearzeroNOxcombustionsystem.

• Powerdemandshortagesensurepotentialforlongtermviablecontracts.

• Fuel available for many years beyond the “beetlekill” glut, as the area has diversified mixed speciesfeedstocks.

• NoIndianAffairsorpublicconsultationissues.

• Everything for operationALREADYpermitted, somuchshortened time to startup. All transmission lines anduplinksalreadyinplace.

• WiderangeoffuelspossiblewithecoPHASER.

• CHPPlantisforecasttobeprofitable.

• LargeCHPuseforbusinessesplannedforthesite.

Energy: The Power Station, it’s Fuel, Thermal Generation Systemplus the heat distribution and circulation system.

* Although the project has the great advantage of its fuel deal and mutual benefits derived with TRL, the original financial plan for viability of this project was based on the use of forestry residue fuel and its attendant costs. Accordingly, the project is recession-proof in that its products are baseline essential grid electricity and staple, fresh “beyond organic” foods.

Accordingly, ecoTECH’s management has every confidence in the success of this venture.

ecoTECH’s long history with the ecoPHASER technology is pictured here »»»»»»»»

Mark III 1987 Mark VII 2007

W e are often asked why the ecoPHASER system uses less fuel than conventional grate and/or fired boiler systems. There are several reasons why this is so:

»] the ecoPHASER System was originally designed to conserve fuel, whereas most other solid fuel systems, especially biomass and garbage fuel systems, are designed to incinerate (reduce) fuels with the emphasis on volume reduction over economical energy production.

»] the ecoPHASER is not a one combustion chamber design. In conventional solid fuel systems, all of the combustion, even in one-chamber “zoned” so-called gasification combustion units, occurs in a thermal firebox with hot spots and erratic, uneven fuel oxidation resulting in Nitrous Oxide creation, after the simple elements of combustion are liberated from the fuel.

The erratic hot spots that occur with conventional burners give rise to silicon (ash) fusing (clinker creation) and dioxin/furan molecular combinations with some fuels.

»] In contrast, the ecoPHASER system consists of three separated chambers for sublimation, air/gas mixing and combustion, that give full reduction of fuel in the sublimation reactor, full gas/air mixture in the carburettor and a high frequency, staccato, short flame front from the Sonic Standing Wave oxidation unit.

The SSW oxidation unit delivers clean radiant energy in the firebox, which has its own particulate burn out and ash removal section. Massive refractory linings constructed from the most avant garde insulation components, stabilize and isolate the chambers, which are devoid of hot spots or chill zones. Sublimation is effected above the creosote potential heat threshold and below the ash fusion temperature. This allows foreign or tramp materials, (sand crystals, soil components, stones, bolts screws and nails etc.) to simply drop out into the ash, without the silica fusing to form clinkers. The fuel is consumed in a substoichiometric atmosphere, giving a smoulder of high steam content combustible and other gases, that lifts without high velocity, to be thoroughly mixed in the carburettion chamber, whilst the unique character of the pulsed burn enables heat to radiate without high gas velocity in the firebox, having an element recombination disruption frequency calculated to eliminate the formation of NOx and other noxious greenhouse gases.

The performance of the Mark VIII ecoPHASER producing heat values of 84 Mega British Thermal Units (Mbtu), or 55 GigaJoules (GJ) per hour is compared with the actual results in 7 years of reports of a 35 Mbtu/hour unit that operated in McBride, British Columbia, Canada at a veneer plant, recorded independently by inspectors and analysts during emissions testing for air-shed clean exhaust compliance. In each test run, the ecoPHASER Mark III clone consumed 2 tonnes of 35-50% total moisture content forestry residue wood (unwashed bark and trimmings) per hour. This unit was fitted with our earlier, less efficient Vortex Ramjet Burner with no exhaust scrubber. The new SSW pulse burner delivers exhaust with near-zero NOx emissions.

Why the ecoPHASER Energy System is so Efficient.

The replacement energy conversion system consists of 3 solid-to-gas, plus liquid-suspension (superheated steam) phase conversion reactors,

(“ecoPHASERs”) which will be placed in an array, each fitted to a secondary stage over-fired thermal oxidation unit.

Oxidation is effected by a sonic standing wave induced pulsed flame with high radiance characteristics. (“The SSW Oxidation System”). A Phaser embodies a primary stage coal or bio-gasification reactor/generator and a second stage high temperature burner.

The <3” (75 mm) shredded wood is fed into this system and fuelled by the biomass feeder systems.

In the primary stage the solid fuel is burned under starved air (sub-stoichiometric) conditions, so that it releases an combustible gas mixture. Ash residue is minimal (circa 2%) as the fuel is totally burned out. The process is actually enhanced by the moisture content of the wood waste.

In the second stage, with a swirled, pulsed vortex of pressurized air added, the resultant gas mixture ignites, ensuring complete burnout of particulate matter with temperatures sufficient to crack hydrocarbons in the fuel and break down the liberated gases to simple elemental products of combustion.

Since the development of the mk VII (2007) ecoPHASER the thermal systems are fitted with a Sonic Standing Wave (SSW) combustion unit that produces a high radiance, mushroom-head flame that pulses the combustion flame at 440 Hz. The high frequency flame oscillation disrupts the recombination of elements of combustion, giving a NEAR ZERO NOx emission profile!

The secondary combustion chamber is connected to a heat extraction system via a tertiary chamber (firebox) which acts as thermal reservoir and stabilizer due to its high mass of super-insulated, reflective refractory. the Sender (receptacle) radiator for the hot oil transmission system is sited within, servicing remote heat radiators for process heat via the high speed pumped oil circuit for remote boilers or humidifiers that generate steam for kilns.

The New Clean Burn Wood Sublimation Thermal System ExplainedPhasers, boiler & heat capture energy conversion system

ecoPHASER Reactor: The combustion gases liberation reaction that occurs when 35% total moisture content wood is sublimated and thermally heated entrained moisture becomes superheated steam, that is released with sublimated carbon; is described in the following equation:

Csolid+H2O steam = CO + H2 *

* = per “Biomass Energy Systems & Technology (BEST) Project” research analysis by Winrock International Institute for Agricultural Development - 1998.

At BlueHawk Station the first stage (firebox driven) hot oil circuit will also provide heat for an Einstein-Szilard refrigeration system for the cold store which will feature a flash freezer, powered by the station electricity, (0.5 MW surplus over nameplate).

Waste heat from the power generation process will be fed through an excess and residual energy recovery system, (like an HRSG, but end producing hot oil in lieu of steam), that will feed the eco-industrial processes, providing greenhouse and aquaculture heating and preheat boiler influent water to prevent shocking of the boiler tubes or heat transfer vanes. The energy depleted exhaust is fed through a patented wet, enhanced surface recovery cloud (bubble) scrubber array.

Although the old-style drum boiler installed at BlueHawk is not optimum by modern standards, its low use history and excellent refurbished condition will allow a successful conversion to ecoPHASER firing.

The existing membrane (water tube) wall in the lower funnel area will be stand-off (insulated) and lined with the high quality refractory material developed by NASA for space shuttle tiles. The SSW jets will be arrayed tangentially to achieve a swirled (cyclonic gas plume) effect with two ecoPHASERs firing and one on standby at all times.

Pulsed wave generation at the SSW oxidation frequency in the tertiary combustion chambers (firebox & boilers) prevents undesirable recombination of the simple products of combustion, e.g. NOx.

With no coal, there will be of course no sulphur dioxide or other “nasties” generation, so the limestone injection system, the cooling towers, the coal feeder silo and much of the coal emission scrubbing paraphernalia become surplus to requirements to be removed and sold off. Instead, we will install a low level shredded wood conveyor system to deliver 4.9 metric tonnes (5.4 US short tons) of green wood fuel per hour to each of the 2 active ecoPHASERs of 3 installed.

The Thermal System ExplainedPhasers, boilers & heat capture energy conversion system:

The Firebox

Due to the intense flame characteristics of the second stage SSW combustion zone of the Phaser, an intermediary ceramic firebox is

used to absorb and radiate the heat into the boiler complex.

The firebox diffuses the drive energy in the flames from the array of 2:3 ratio, active to stand-by Phasers, to achieve desired CHP capacity. The highly radiant heat flux of the SSW burners slows the ignited gas jets to produce a mushroom shaped flame front from each SSW unit. This effect, induced by pulse combustion, effectively reduces hot gas velocity through the system, resulting in fewer heat losses and better heat transfer to the boiler sections, with total burnout of particulate lifted with the primary stage gases.

This results in clear exhaust plumes, even without scrubbers.

The new firebox will allow heat into all of its surfaces and it glows red hot, deflecting and blending hot spots to achieve a homogenized radiance, which heats the boiler

tubes without zone shock.

The boiler is of the Drum type and is of a pyramid design, with the new firebox forming the lower zone as part of the conversion. All of the lower boiler firebox heat zone will be walled with highly reflective custom refractory and heavy foamed ceramic insulation. The ecoPHASERs’ nozzles will be fired into the cone tangentially to create a cylindrical vortex path up through the boiler zones.

The travelling gate combustion assembly will be scrapped.

The Modified Boiler: The existing Babcock & Wilcox Stoker Boiler is of a type proven over decades of use in travelling grate coal combustion systems, where its ruggedness and heavy construction is necessary to contain the continuous acid corrosion onslaught and particulate combustion of the old-style coal burning process. It is therefore strong enough to provide several decades of use with annual servicing, which will be much reduced with the kinder characteristics of ecoPHASER combustion.

The feed water is pumped through the tubes in a true forced-circulation manner.

Pure warmed feed water (from treated condensate, with partial fresh make-up) is to be used with this boiler. Accordingly, we will use our closed loop water system, with excess steam and water recovery via combustion inlet air preheat through the system’s condensers.

Make-up feed will be from an evaporator so that distilled water will be produced for feed. Any salts formed on internal surfaces of the tubes are dissolved and removed when the unit is started up or shut down, operating as a flooded system.

ecoTECH has researched many ways to inhibit the corrosion usually associated with steam production. With new advances in understanding high temperature microbial action on boiler tubes, recent development of biofilm colony disruption additives will ensure a trouble-free extended life for our project.

New understanding of the signal mechanisms that allow biofilms to form has brought about a remarkable additive that disrupts communication signals and prevents link-up of high temperature microbial tube munchers!

Actual through porthole views ofecoTECHcombustionsystemprimarygasifyingchamber.

C. Victor Hall (left) examines a Mk II ecoTECH gasifier in April 1990, after 3 years in operation.

The unit continues to heat an 800,000 sq ft factory in Wisconsin USA.

ecoTECH Phaser systems are designed for longevity an ease of maintenance, but, as with all mechanical devices, a fail-safe system has to

be designed to avert loss of critical system problems, (perhaps with fuel flow, from feeder system component failure), so an extra unit will be deployed to guarantee up time in this critical operational zone.

The illustration below shows the fuel feeder system of a smaller ecoPHASER.

It shows the fuel being conveyed to a hopper. We size the staging hopper to suit the fuel flow required with the main storage area outside the station. Thus allows for secondary screening if the shredded wood fuel with magnets and a grizzly screen to trap tramp items.

The ecoPHASER reactor has simple controls. As the air: fuel ratios for the primary phase reactor (substoichiometric chamber) are within known parameters without much variance, the unit simply feeds to is programmed temperature and stops until the temperature dips to the lower end of its operating band.

The sublimation reactor has an operating temperatures in a narrow band circa 1250 0F /675 0C, above the temperature where creosotes or tarring will form and below the ash fusion temperature of the silicone in the sand etc, we can expect with residual woody biomass fuels. As the wood is not burdened by fluctuating

amounts of ash, as with coal, all of the biomass is consumed.

Fuel is augured vertically into a cup hearth (see next page), and smoulders on the top of the upthrust cone, to finally cascade as fine burned-out residual in the low pressure reactor over the hearth rim as it sublimates, where it tumbles into a refractory-line final burn funnel, to be augured out as pozzolanic ash suitable for hard concrete manufacture as a cement additive. The ash, which is not toxic in any way, will be offered to local cement batch plants after a period when our own site concrete improvements have been completed.

Summary

The energy conversion system for BlueHawk Station consists of 3 solid to gas phase reactors, with liquid-

suspension (superheated steam) lifted by the gasification process. The ecoPHASER reactors are placed in a tangential array of three, with two live firing at all times and the third unit on preheated standby. Each fitted to a secondary stage pulsed, over-fired thermal oxidizer (“The SSW burner ”).

Definition: An ecoTECH ecoPHASER system embodies a primary stage solid fuel sublimation reactor/ gas generator and a second stage high temperature SSW burner.

Servicing an ecoPHASER Hearth

ecoPHASER mk VII Hearth

Components ActionRemovals

1 Coal Silo & Feed Hoppers sell off2 Cooling Towers sell off3 Baghouse sell off4 Travelling Grate Assembly scrap

5 PondRemediate & use for aquaculture/horticulture water storage

Remodel6 Boiler (lower section) Refractory lined firebox7 Control Room Replace existing

8 Fuel conveyor systemUtilize where possible in wood fuel prep & storage

New9 3 ecoPHASER systems Build MkVIII units

10 1 Wood fuel preparation system Shredder, trammels & feeder installation

11 1 Wood fuel storage building Perhaps with silo

12 2Thermax hot oil circuits; Kilns, cold store, greenhouse and aquaculture feeds

1 high temperature firebox loop and 1 medium temperature (heat recovery) loop.

13 1IP controlled computerized management system

Single wire & wireless remote capability

14 1 Control Room with elevatorFull viewing capacity including security cameras

15Yard equipment: weighbridge, hard standing and new roadways

Includes new security fences

16 Stack monitoring system Realtime exhaust analysis

17 1Permanent administration building

Replace existing portacabins

18 2 Out buildings

Possible

19 Repair uplinks and power lines Update components

Soft Items20 DEQ Permitting Unlikely, but in case....21 Management Software For new control circuit22 Remote control system Secure Internet Protocol23 Off-site monitoring View as if there

Delivery COD 9 months from completed acquisition

Budget $30,000,000

BlueHawk Power Station Conversion

Thompson Falls:16.5 MW Elliott turbine

Solid - to - gas - to - energy

Horticulture & Aquaculture at Thompson Falls

This section of the document describes a plan to build ancillary businesses to augment and complement a 16 megaWatts per hour thermal

electricity generating plant that will use sustainable, renewable biomass fuel, sited on land adjacent to the CHP power station.

The businesses are in the sustainable fresh produce, indoor, land-based food fish aquaculture and silviculture sectors. The power station and the ancillary businesses are being developed by ecoTECH Energy Group Incorporated, (“ECTH”) a Nevada corporation, a fully reporting public company, traded on the OTC:BB exchange under US SEC rules.

ecoTECH subsidiary ecoTECH Energy [Montana] Inc is the developer in the region.

The Company is seeking enough equity financing to own the majority of the ancillary businesses described in this document. Management, training and technologies will be provided by ECTH.

Introduction: The Participants & Project Background

The objective of this project is to provide healthy fresh grown food products for sale to local and regional Montana city populations; to provide employment and sustainable income for Sanders County residents; to reduce the carbon footprint of importation

of food from other states and countries (Mexico, Canada) and to replace derelict sawmill operation with a trio of dynamic new enterprises.

The driving initiative for the programs described herein is the planned two phased power station complex that will share the site. The power station, to be converted to woody biomass fuel usage by ecoTECH Energy Group, is built to produce 16 megaWatts per hour of power in phase one, using renewable forestry derived fuel, for thermal conversion to combustion gas -derived energy.

The thermal energy is conveyed via a custom hot oil circulatory system from which part is utilized in a sawmill products conditioning drying kiln operation, at Thompson River Lumber, next door neighbour and fuel supplier to the renamed BlueHawk Biomass Energy Power Plant. Output of the power station will be 16 megaWatts per hour, using new ecoTECH CHP steam systems and fuelled by forestry-derived fuel. The re-powering project for conversion to CHP is scheduled to commence construction immediately on closing of the conversion finance..

The heat that is surplus to power generation is to be utilized by the proposed businesses for production year round, which can also consume some of the exhaust carbon dioxide in the process of transpiration.

The three sustainable industry businesses planned for the site are:

• A HydroNov hydroponic produce greenhouse.

• A HydroNov indoor aquaculture fish production facility.

• Cold store with flash freezing and packaging facilities.

All the businesses lean into the indigenous skills and capabilities of the Sanders County and Clark Fork Valley residents, building on the inherent local expertise from forest husbandry.

ecoTECH is the official developer for HydroNov Inc. North America ( www.hydronov.com ) .

Technology by:

HydroNov Inc. is an international leader in greenhouse production, in operation since 1987, has developed and adapted several agricultural production technologies, leading to harvests far superior to traditional growing methods, both in quality and quantities.

HydroNov’s distinctive approach is to get involved on a long term basis into technical and production supervision, bringing 20 years of hands-on experience available to each new project.

HydroNov has been active and successful during the last 18 years, in exporting and implementing its technology over 30 hectares in Canada, China, Mexico, USA, Japan. Projects are currently under development in Dubai, Malaysia, Ivory Coast, Mongolia and China.

More information, pictures & videos at: www.hydronov.com

The Technologies and Training

GREENHOUSE HYDROPONIC AGRICULTURE

Hydroponic means growing without soil. From there, several different systems have been put together since the early nineteen-sixties, starting mostly in England and Israel. Early systems were very basic, replacing soil by a growing media like

sand, peat moss or rock-wool.

Why does it work?Because plants are not feeding on soil but on minerals hidden in the soil. The purpose of hydroponic agriculture is to make those minerals available to the plants directly through water. Modern hydroponic growing systems are using more water plus nutrients growing media, preventing depletion of natural resources such as peat moss for example and accumulation of residues like rock-wool and other fibers.

The ultimate hydroponic growing system will combine water conservation, zero media residue, biological fertilization and water revitalization. HydroNov’s deep pool growing system is very close to that.

AQUACULTURE

Recent development in water recirculation systems (Recirculated Aquatic Systems, or RAS), for fish production are quite similar to those made for recirculated hydroponic plant production. New technologies now allow

indoor production levels to 200 Kg per square meter annually, (+/- according to species), helping to overcome the dramatic decrease output from traditional wild fishing.

Recirculated Aquaculture

The development of water recirculation applied to fish production has made possible to grow several fish species in a wide range of locations in the world. One of the main advantages is to save water whilst increasing production levels, thus helping to protect water resources while helping to feed the world.

Advantages of water recirculation technology applied to fish production:

• Capacity to control temperature, oxygen, salinity and pH to maximize growth according to each species requirements,

• Protection against fish diseases,

• 98% reduction of water use,

• Complete control of waste rejection to the environment,

• Most importantly: these systems are indoor, contained and safe environments that allow no leakage, species release or risk of contamination to watercourses or indigenous fish stocks, or predation that occurs with outdoor fish farming.

Protected Soil Horticulture:5 Harvests / Year

Outdoor Soil Farming:3 Harvests / Year

Protected Hydroponic Floating Technology:18 Harvests / Year

QUALIFICATIONS

With eighteen successful major installations around the world, HydroNov Inc. is the acknowledged leader in the field of deep water hydroponics, RAS aquaculture and the combined sciences that are sometimes under one roof - “aquaponics”.

Whilst the ecoGROW division of ecoTECH Energy Group Incorporated creates the facility, skilled and knowledgeable HydroNov staff select and train recruits to operate the facilities. Just as with our contracted power station operator, training systems and facilities are set up to empower local workers with specific operations that cover an extremely wide range of skill sets and capabilities.

We believe that the scope of activities will encompass the job creation needs of the local communities with opportunities for participant workers of all ages, each gender and any indigenous background.

It is possible for ecoTECH to set up a hydroponics, aquaculture and silviculture curriculum with a local College.

Performance forecasts of the Businesses

The businesses hereafter described are in the environmentally sustainable sector, with two in food production and one will be an enabling contributor to reforest the disease decimated regions of Montana and adjacent states, where millions of trees are dead or at risk.

All can be described as being in true growth industries in every meaning of the words. The businesses are:

1. Year round hydroponic produce; vegetables and herbs.2. Food fish propagation via aquaculture, with some filleting preparation.3. Tree seedlings greenhouse nursery operations.

Due to the differences in operations and marketing in each of these projects, each is treated in this document with a short form economic business case, or “mini business plan”.

The Technologies and Training

Lettuce yields 18 crops per year

HydroNov’s expansion has been achieved based on the development of a revolutionary growing technique:

The Floating Rafts Technology (FRT), for vegetables and flowers.

Floating Rafts Technology is certainly the most “water-conscious” system among existing hydroponic growing systems. One of its key features is the use of a large volume of water allowing enormous buffer for fertilisation and oxygen control as well as economic plants transportation by flotation. This large buffer brings a level of security and easiness that no other growing system can match.

With FRT:

• absolutely no water is lost through soil or growing media, • no direct evaporation to the sun,• no dumping of growing solution, • no dripping gutters;

just plant’s needs, making it the most economical system in terms of water usage.

FRT leads also to a much higher productivity, bringing the possibility to grow up to 18 crops/year of lettuce for example, at average head weight of 200 grams, (7 oz.).

FRT provides an integrated internal transportation system, simply using the flowing growing water as a conveyor system. As plants move from starter station to trimming and pruning station, to harvesting station, to packaging, as each floating raft is removed at the end of the growing channel, for packaging, those behind are moved up one raft length as they touch, buoyed on by the nutrient enriched current of highly oxygenated water flowing through the roots.

A biological support base is quickly established in the growing pools, giving the plant this extra strength and a healthy immunity.

No herbicides or fungicides are ever needed.

Introduction to the growing technology

1. Hydroponic horticulture produces off-cut and residual vegetable leaves and stems

2. The leaves form the feed for the vermiculture section

3. The organic vegetable-fed worms give worm casts and liquid plant supplement.

4. Worms are fed to the carnivorous fish species in the aquaculture section

5. Diatoms from the horticulture aqua-troughs are fed to herbivorous fish species

6. Fish manure-laden water is filtered and used to float the hydroponic plant trays in the hydroponic section

7. The enhanced trough water flows through the system, feeding the plants with 17 nutrients for complete nourishment

8. Fish offal is utilized in the liquid plant nutri-stimulant production place.

Full Circle Nutrition

The total nutrition

and growth circuit

The ecoGROW Total Cycle System embodies a series of co-operative inter-species symbiotic sequences that utilize as many of the benefits possible from deep trough hydroponic horticulture, where plants are supported in floating trays, with the

feeder roots in a nourishing organic water mix, which in this case does not use the typical hydroponic chemical feed with its emphasis on NPK (Nitrogen, Phosphorous, and Potash (Potassium)) as proffered by chemical refineries over the past 100 years, but instead garners the 17 nutrients found in active fish effluent.

In aquaculture, the water quickly becomes nutrient rich due to the fish digesting their food and excreting waste. The waste water in non-ecoGROW systems is usually filtered and/or disposed of to keep the tank water free of toxic buildups. The fish waste provides a food source for the growing plants and the plants provide a natural filter for the fish. This creates a mini ecosystem where both plants and fish can thrive. This symbiosis is called Aquaponics and it is the ideal answer to a fish farmer’s problem of disposing of nutrient rich water and a hydroponic grower’s need for nutrient rich water.

The food fish that provide these all-natural additives are themselves fed on organic fish foods, such as our tank grown Periphyton, a complex mixture of algae, cyanobacteria, (also known as blue-green algae, blue-green bacteria, and Cyanophyta), heterotrophic microbes, and detritus that is attached to submerged surfaces in most aquatic ecosystems, where it has the ability to remove contaminants. The ecoGROW System incorporates a separate Periphyton room, where it is fed high levels of carbon dioxide from the power station, which is disassociated into carbon (in the algae growth) and high levels of dissolved oxygen in our pass through water circuit that provides habitat and nutrient for the herbivorous fish, such as Tilapia.

In the ecoGROW System, the plants and fish are in separate buildings, separated by the pump-house that has filtration circuits and air-sparging to enhance the ability to maintain optimum qualities in each environment. Although the symbiosis enables the fastest and healthiest growth rates, each species has different ambient needs of temperature and light, so sectional propagation areas in greenhouses and aquaculture buildings are essential. Species specific,

tuned LED lighting systems are utilized to augment sunlight.

The ecoGROW Total Cycle Concept

Multiple produce tested at the South Alberta Crop Diversification

Centre, photographed in 2004.Note how healthy these deep water raft grown plants are on

fish-waste nutrient water.

Off-cuts, outer lettuce leaves, roots that are not pulped for vegetable drinks, surplus algae etc. are conveyed via the automatic processing system (shown in the Horticulture section following), to the vermiculture facility located between the horticulture and aquaculture main buildings. In the vermiculture grow pens, our

organically-fed worms dine on the rejected vegetation, converting it into worm casts and worm tea, a fine nutrient to add to the plant trough water in the pump room. As the entire complex relies on flowing, carefully monitored water, nutrient loading is maintained by computerized analysis and metering.

The worms are grown to be organic home-grown clean live food for the carnivorous species of fish (trout, etc.). With young fingerlings, zooplankton, (Daphnia etc.) are provided by our Periphyton facility.

Occasional import of high nutrient organic feed is necessary, but the Total Cycle system is as near to self-sustaining as we can get, essentially turning sunlight, oxygen, nitrogen and carbon dioxide into clean, living and balanced food fish and vegetables.

Several circuits are deployed in the System with switch ability, so a water stream that may become contaminated by spills or

mechanical problems, can be by-passed or flushed through using alternative routing from adjacent water systems.

Speeds of flow are different, with some species of fish preferring faster RAS currents, but these are local adjustments in each RAS tank, each of which has its own pump, filtration and air sparging system.

The ecoGROW Total Cycle Concept

On all locations developed by HydroNov to date, the market has been enthusiastic to the arrival of a new upscale commodity, grown under a protected environment, fresh, clean, and with a constant supply.

Butterhead lettuce has been adopted as a main standard for most of the greenhouse production units for one simple reason: European breeders have been offering Butterhead varieties since the middle of the past century, selected for their ability to grow well indoors. It was then and still is the standard lettuce for Western Europe, although recently the varietels array offered is much wider, just like in North America. No other types of lettuce seeds adapted for indoor production were offered until recently.

Constant research is now bringing up the possibility to also produce a wider base of lettuce types including Romaine, Cos, Curly Lolo Biondo and Lolo Rosso, Oak Leaf Green and Red, as well as Leaf Green and Red.

Besides lettuce, other leafy crops can also be grown successfully, including aromatic herbs, medicinal herbs, American spinach, Chinese spinach, watercress, …..

AMONG OTHER PRODUCTION CHOICES:

Cooler night locations would be suitable for the production of red lettuces, due to a natural mix of quality light and cool night weather. The market has great expectations for a reliable source of quality greenhouse red lettuce. Red Butterhead, Lolo’s, Oak Leaf and Red Leaf types are showing great market possibilities.

Fast Growing Short Leaf Crops

The Romaine, Cos type of lettuce has a very fast growing market segment among the field grown lettuce varietals. To complement the large size field types, greenhouse production is providing the market with smaller versions, that can be grown in a fraction of the time, whilst bringing more quality and taste

compared to the field grown counterpart.

A recent evolution of the FRT system has enabled the possibility to produce all the direct seeded high density (usually Short leaf) crops, either herbs like Basil, greens like Arugula, or baby version of vegetables like spinach and lettuce.

HIGH DENSITY FLOATING SYSTEM FOR SEEDED CROPS:

The HD board developed for this application integrates the advantages of Floating Rafts Technology with the simplicity and spacing flexibility of peat based media.

The end result is a highly mechanized system, where 5 workers can produce up to 320,000 KG per year of first quality baby leaf vegetables per hectare (= 250,000 lbs per acre, per year).

The direct production costs are limited to a small quantity of peat mix and a variable quantity of raw seeds, usually available at low cost.

Direct labor cost is greatly reduced, the machines specially developed for this process having the capacity to supply tens of acres of production within 1 shift per day.

LOCALE & CLIMATE CONDITIONS:

Available weather statistics for the location are indicating a climate with cool night temperature year round, an important factor for quality leafy vegetables.

We are as well expecting humidity to be on the low side, and winter light not sufficient to grow a quality crop without artificial lighting.

Fast Growing Short Leaf Crops Performance

Production Area Block identification 1 Length 150.00 m 492.13 ftWidth 153.60 m 503.00 ft

Covered Area 23,040 m2 248,000.00 ft2

Growing Area 19,833 m2 213,480.00 ft2

* - flotation boards/trays *Production Boards 26,096 26,096.00

Nursery Area Length 150.00 m ftWidth 48.00 m ft

Covered Area 7,200 m2 77,500.00 ft2

Growing Area 4,958 m2 53,370.00 ft2

*Nursery Boards 6,524 6,524 Testing Area *Testing Boards 0 0

Summary

Total Project Area 37,974 m2 410,000 ft2

Total Greenhouse Area 30,240 m2 325,500 ft2

Working & transportation Area 5,449 m2 59,000 ft2

Pump & Filtration House Area 280 m2 3,000 ft2

Packing & Warehouse Area 1,075 m2 2,655 ft2

Cold Store Area 930 m210,000 ft2

Capacity of Production

Density number of plants per 24 m2 2.23 ft2

Annual Crop Rotation

Total Harvest 432 m2 4,650 ft2

Marketable Plants

Potential Harvest

Plants per Year 367 m2 34 ft2

Plants for Growing AreaFor SaleBy Weight per Year 1,515,520 kg 3,334,144 lbs

Rejected to Vermiculture facility per year 267,445 kg 588,378 lbs

Expected Water Requirements At Fill-up

Per Month Usage 1,239,560 litresUS Gallons

si units US Measure

dozen per year606,209

7,437,360 litresUS Gallons

18 per year

85%

7,278,466 per year

Cost of Greenhouse (only - no cold store)

Building, equipment and Services for the project are proposed by HydroNov at a firm price of USD $7,432,432. Other expenses related to land preparation, infrastructure and construction are estimated at $1,455,000.

Thompson Falls:ecoGROW/HydroNov Greenhouse Only

Price Summary : Phase 1

1 Land & Services $200,000

2 Greenhouse Building $1,642,368 $800,000

3 Greenhouse Equipment $1,827,840

4 Services Building (Equipped) $183,456 $55,000

5 Cold Storage Staging Area $87,360

6 Floating Raft Growing System $2,032,128

7 Production Equipment $833,280 $100,000

8 Delivery & Insurance $112,000

9 Installation & Concrete Works $294,000 $300,000

10 Follow-up & Production Supplies $420,000

sub-totals $7,432,432 $1,455,000TOTAL: $8,887,432

TERMS & CONDITIONS

Travelling Expenses IncludedC.I.F.Site

Status of this draft proposal: PRELIMINARYPayable by Irrevocable Letter of Credit

ALL IN USD

Internal Partitions

n.b. These guide figures are for the main structure of the facility only. The following does not include the Cold Storage Facility, the

Site Complex Combined Water Make-up Facility or the Vermiculture Facility. Budget for the 3 service facilities is

$4,000,000 USD.

Primary Services

Installation

NOTES

This is a preliminaty quotation only from HydroNov

Contingency

Concrete & Drainage

Based on HydroNov’s experience with large-scale greenhouse production, a project that is presenting the necessary elements can become a highly profitable venture, able to normally show a payback period of 36 to 60 months.

Here are the major elements to be considered regarding the potential profitability of modern greenhouse production:

• Sunny, temperate weather year round, or ecoPHASER + LED.

• Cooler nights.

• Manageable relative humidity.

• Proximity to urban markets and/or access to export markets; or ecoPHASER Cold storage.

• Access to good quality water.

• Available labour force at competitive price.

• Accessibility to competitive energy sources (ecoPHASER biomass).

• Efficient management (trained by HydroNov).

This section presents the production capacity of this project, and gives an idea of the potential financial results from such production. Although based on similar production circumstances and adapted to local conditions, the financial information presented here is given as information and indication only, and cannot be understood or interpreted as a guarantee of future performance.

Some important items have a positive effect for the potential success of this project. Amongthose, light availability, (supplemented by artificial lighting), and weather conditions, size of the product, sales price, labour, energy cost, and financing costs have a major influence.

• Quantity and quality of available natural and artificial light along with average weather conditions will allow regular and fast cropping of high quality product, without the burden of investing in heavy heating, (except where ecoTECH CHP surplus is available, an important positive factor).

• Trend has already been created for Greenhouse Boston lettuce to be sold between 150 and 250 grams. This project should be able to easily maintain a 200 grams minimum for its product, and still keep a fast turnover based on 18 crops per year.

• Selling price has been budgeted at an average of $9.70 per dozen; This selling price should allow an easy penetration of the market.

• Labour and energy costs normally account for 15% of the operational costs of a north ern climate greenhouse. This figure is here reduced to 7% for this project, a decisive advantage.

NB: there are 2200 + sunshine hours per annum – in the Clark Fork region, 2028 in Mirabel Quebec, home of the HydroNov first and most successful greenhouse, since 1988.

Thompson Falls as a Horticultural Prospect

Financial Prospects for the Horticultural Project

Based on those assumptions and several others, this project is definitively presenting financial viability, with a profit before taxes of 43 %, and a return on investment of 23%.

Sales are budgeted at $5.5M, bringing in a gross profit after depreciation of $2.4M, a net profit before taxes and financing of $1.6M and a cash-flow profit before debt service and depreciation of $2.1M.

HYDROPONICS ONLY PROFORMA FINANCIAL STATEMENT

13

Based on those assumptions and several others, this project is definitively presenting financial interest, with a

profit before taxes of 43 %, and a return on investment of 23%

Sales are budgeted at 5,5 M $, bringing in a gross profit after depreciation of 2,4 M $, a net profit before taxes

and financing of 1,6 M $ and a cash-flow profit before debt service and depreciation of 2,1 M $

PRO-FORMA FINANCIAL STATEMENT12 MONTHS / JAN.-DEC.

TOTAL %

SALES 5,594,385 $

RAW MATERIALS 1,216,775 $ 22%DIRECT LABOUR 993,549 $ 18%FACTORY OVERHEAD 985,000 $ 18%

GROSS PROFIT 2,399,061 $ 42.9%

SALES/ADMINISTRATION 718,958 $ 13%

PROFIT BEFORE FINANCE COSTS 1,680,102 $ 30.0%

FINANCE COSTS - $ 0%

PROFIT BEFORE TAXES 1,680,102 $ 30%

INCOME TAXES - $ 0%

NET PROFIT 1,680,102 $ 30%

14

CASH-FLOW12 MONTHS / JAN.-DEC.

JAN. FEB.

SALES 400,200 $ 376,533 $ 5,594,385 $

CASH INFLOW 400,200 400,200 5,594,385

EXPENSES RAW MATERIALS 88,813 88,813 1,127,962 DIRECT LABOUR 59,466 67,713 993,549 FACTORY OVERHEAD 82,083 82,083 985,000 AMORTIZATION -40,833 -40,833 -490,000 SALES/ ADMINISTRATION 54,731 52,873 718,958 INTEREST 0 0 0 DEBT 0 0 0 IMMOBILISATION 0 0 0 INCOME TAXES 0 0 0

244,260 $ 250,649 $ 3,335,470 $

CASH SURPLUS 155,940 149,552 2,170,102

CASH AT THE BEGINNING 0 155,940

CASH AT THE END 155,940 $ 305,492 $

RETURN ON INVESMENT (R.O.I.) 23%ESTIMATED OVER 10 YEARS

155,940 149,552 2,170,102CASH INFLOW YEAR 1 2,170,102INVESTMENT (8,500,000)$ YEARS 1 2,170,102$

2 2,191,803$ 3 2,213,721$ 4 2,235,859$ 5 2,258,217$ 6 2,280,799$ 7 2,303,607$ 8 2,326,643$ 9 2,349,910$

10 2,373,409$ N= 10

INDEXATION= 0.01T.I.= 0.1

Thompson Falls Horticultural Forecast

Aquaculture is developing, expanding and intensifying in almost all regions of the world. Global population demand for aquatic food products is increasing, the production from capture fisheries has levelled off, and most of the main fishing areas have reached their maximum potential. Sustaining fish supplies from capture fisheries will, therefore, not be able to meet the growing global demand for aquatic food.

UAE and Saudi Arabia are net importers of fish for an amount estimated to USD $100 Millions and USD $200 Millions respectively in 2006, an increase of 21% over the previous year. Beside more exotic species like trout and arctic salmon, Tilapia is a market winner, as well as new introduction Barramundi which have been gaining very large acceptance on North American and European markets over the last 10 years The current food fish consumption per capita is average, at 18,6 kilograms per person per year in UAE, and only 8,5 Kg in Saudi Arabia, Vs 60 Kg per person in Japan and 24 Kg per person in China and USA.

( IFPRI / WorldFish Centre : FISH TO 2020 Supply and Demand in Changing Global Markets, & FAO National aquaculture sector overview )

Fish production is big business on the international trade. In 1984 the net exports earnings in term of foreign exchange was US $ 5 billion ; in 2004 the value was more than US $ 20 billion, a fourfold increase. No other agricultural products come even close.

Fish production using conventional aquaculture systems, outdoor ponds, cages, tanks, etc. have important limitations; in most instances, inability to control quality of water, weather changes, predators, fish diseases and high mortality, resulting in low productivity, inconsistency in fish production and quality and severe threat to the environment. The Food and Agriculture Organization of United Nations have highlighted in some of its studies, the intensification of aquaculture farming systems including the adoption of Recirculating systems as a way forward to alleviate problems caused by conventional aquaculture.

( FAO Fisheries Circular No. 1017/2, REGIONAL REVIEW ON AQUACULTURE DEVELOPMENT)

( The State of World Fisheries And Aquaculture 2006 , FAO of the United Nations, Rome, March 2007 )

( The State of World Fisheries And Aquaculture 2006 FAO of the United Nations, Rome, March 2007 )

Aquatic Food Industry Worldwide Status

Intensive Recirculating Aquaculture System (RAS), offers a safe and healthy alternative to open pond fish farming, salt and freshwater pen farming, controlling all factors to produce up to 20 times more than ponds, cage or flowing trough fish farming systems, and at the same time bringing consistency and quality fish

production. It also brings the possibility to install production units closer to market, thus reducing delivery costs while bringing a fresher ecological product to the consumer.

Whereas the other types of aquaculture are exposed to bad weather risks, non-indigenous fish species escapes through accidents, faecal contamination, disease spread and are difficult to monitor in real time, RAS offers human food quality and safety above all of the other legion of advantages it brings to the industry. Fish environments are constantly flowing, tuned to optimum for each species as to water makeup, temperature, salinity, pH and are constantly monitored. With no stress, no diseases to fight and organic feeding, the fish growth and weight gains are ideal.

The Hydronov Intensive Recirculation Aquaculture System is a closed system, spread over 24 independent and individually controlled pools per hectare. Water is circulated continuously to guarantee optimum growing conditions, and passed through mechanical filtration, UV sterilization and biological enhancement. Oxygen is provided and fresh water added at a rate varying from 5 to 10 % per day.

A typical production unit can start from a minimal 1 Hectare (110,000 ft2) size and expand as needed up to 20 Hectares (2,150,000 ft2) and more if market and water resources allow it. The initial production target should focus on well established fresh water species as Arctic Char, Barramundi, Trout, Yellow & Silver Perch, Tilapia and introduce progressively more exotic and/or local species.

The typical productivity will be oscillating from 1,000 metric tonnes per 1 Hectare module (1100 US short tons per 110,000 ft2), for cold water fish like Arctic Char to 2,000 tonnes per 1 Hectare module for warm water fish like Tilapia.

This compares very positively with a typical production of 30 to 50 tons per Hectare for the pond system under the best conditions.

The investment cost for the 1 Hectare module is estimated at USD $4.5 million for the Recirculating Aquaculture System and related equipment, while USD $1.5 million will be needed for the buildings and infrastructure. Savings can be made on buildings and infrastructure according to existents on projected site.

Sufficient land for future expansion need to be secure, with access to sufficient fresh water of acceptable quality.

The average projected cash flow profit per module is USD $1.5 - 2 million, carrying a potential return on investment ( ROI ) of 25 to 35 % .

Although this technology, installed close to consumer markets, will favour easy distribution of fresh fish, there is also an important potential for downstream activities, from filleting and freezing to extraction of Omega 3 fish oil and use of Tilapia skin for fine leather processing.

Intensive Recirculating Aquaculture System (RAS)

The RAS System from HydroNov

HydroNov’s Recirculating Aquaculture System ( RAS ) is a closed system spread over 24 independent and individually controlled pools per hectare. Water is circulated continuously to guarantee optimum growing conditions, and passed through mechanical filtration, UV sterilization and biological enhancement.

Oxygen is provided and fresh water added at a rate varying from 5 to 10 % per day.

The features of HydroNov’s RAS are as follows : -

> Each 1 Hectare module consists of:

• 24 independent production pools measuring 27 m X 9 m X 1,2 m

• 6 purification pools to prepare fish for market

• 1 stabilization section to raise small fish from fingerlings

• 1 hatchery section to raise fingerlings from eggs

• Control room & laboratory

• Dry & cold storage area

• Electrical & heating equipment room

• Administrative office & workers area

RECIRCULATING FLOW (RAS) TANK SYSTEM CUTAWAY

Intensive Recirculating Aquaculture System (RAS)

AquacultureBuilding

The RAS System from HydroNov

Fish Production PoolRecirculating System

Recent developments in water recirculation systems for fish production are quite similar to those made for recirculated hydroponic plant production. New techniques now enable indoor production levels to achieve outputs up to 200 kilograms per square metre (40 lbs per square foot) per annum, (varies with species). This highly productive system helps to compensate in part for the dramatic decrease in wild fish catches worldwide.

Recirculated Aquaculture System (RAS)

The development of water recirculation systems for high density fish production has made it possible to grow several fish species in their natural temperature and water pH conditions, using fully self-contained indoor tanks in buildings designed for optimum light and oxygenation conditions, sometimes many thousand miles removed from the species’ natural habitat: free from predation, run-off leachate from industry or agriculture, parasites and disease.

This state-of-the-art system, coupled with non-chemical organic fish feeding, saves huge volumes of water in comparison to standard fish farming and is has none of the above mentioned dangers. The result is guaranteed fresh, clean and wholesome fish, grown in optimum conditions at the most profitable sustainable rate. As each pool provides an optimum habitat where oxygenated water flow is adjusted to simulate water currents and flushing rates found in the fishes’ evolutionary environment, all ranges of normal ambients, (temperature, salinity, pH values, optimum current speeds and healthy food) can be accommodated, with no danger of losing fish to the wild, where indigenous species can be lost.

Fish environments can be customized, so that even endangered species can be repopulated using our methods under the control and management of local fish and wildlife authorities.

Advantages of the Recirculated Aquaculture System in food fish production

• Capacity to control temperature, oxygen, salinity and pH to maximize growth according to each species requirements.

• Protection against fish diseases. Regular fish health monitoring and inspections.

• Clean and healthy organic fish feeding, with no build-up of wastes and toxins.

• 98% reduction in water use, compared to traditional fish farming.

• Multi-species in-house capacity to suit local tastes and markets.

Principles of the Recirculated Aquaculture System in food fish production

1. Mechanical filtration removes solid particles from fish excreta.2. Ultra Violet infusion disinfects the recirculated water.3. Biofiltration plus zeolitic natural filters remove trace ammonia

and nitrates.4. Oxygen saturation plus 2% fresh spring or rainwater is added.5. pH is adjusted with all-natural toning filters of species specific types.

Recirculating Aquaculture System Pool Layout

RECIRCULATING FLOW (RAS)TANKS ARRAY IN 110,000 FT2 BUILDING

Advantages of HydroNov’s RAS

Reduced water requirements by 95% vs flow-through or outdoor systems

Water quality control bringing complete food safety, free from contamination by heavy metal, growth hormone, antibiotics, pesticides……..

High stocking density & efficient feed conversion ratio bringing up production output 20 times more than conventional pond farming system

Site flexibility & year round stable production of healthy fish

Waste management control and treatment, with no adverse impact on environment

Low production costs versus potential sales prices

A high level of integrated bio-security, making it possible to implement all certification processes like GREEN FOOD, HACCP, HALAL, ….etc.

It is proposed to implement a first phase of 1 Ha with 4 growing modules to demonstrate the potential of the technology. This first phase should focus on well established fresh water species as Arctic Char, Barramundi, Trout, Yellow & Silver Perch, Tilapia, Catfish, and introduce progressively local and other high value species

which may need to be further adapted to aquaculture.

Once technology is well demonstrated and market penetration strategy established, phase 2 can then take place following market needs and investment capital available First phase construction can start 2 months after funds confirmation and be completed within 12 months. Production of fast growing species can reach market within 4 months, making it a total of 1 year after contract signature.

GENERAL COMMENTS ON THE ECONOMIC VALUE AND MARKET POTENTIAL OF DIFFERENT FISH SPECIES

1. Rainbow Trout - A classic for aquaculture production, already produced by several small and medium scale growers; not a novelty anymore.

2. Arctic Char - This fish is said to be a cross between a Salmon and a Rainbow Trout, is better tasting than both, and is progressively replacing Salmon as a healthier alternative. It is already being produced in Canada but in relatively small volume. Market prospect is very good

3. Murray Cod - This fish is widely produced from aquaculture in Australia. Highly popular fish, it carries an ex-farm price of $ 8 – A$ 10 per kilo,depending on the season. It has an appeal like the marine cod fish. Murray Cod >>>>>

4. Jade Perch - This fish is also from Australia. It is considered as the most healthy fish containing more Omega-3 fish fatty acid than any other fish, as much as 2 % per 100 grams of fish meat. It is also a good tasting fish.

5. Tilapia - This is the most popular fish in the world. It is grown in several countries with different results and outlook. While in North America it is considered as a high-end fish with similar pricing as Trout and Salmon, in some Asian countries it has suffered adverse reputation as having an “ unsavory earthy smell “ and being grown in unhygienic conditions. The poor growing conditions is the reason for the problem in those countries, effectively producing that bad taste. Already produced in good volume by North American aquaculture industry, it requires warm water to develop well.

6. Barramundi - Also known as Sea bass, this fish is a relatively new introduction in aquaculture production and is gaining rapid acceptance as a good value fish.

7. Silver Catfish - A high priced fish on some Asia markets, it can be a niche market fish with a good pricing if properly marketed.

8. Small catfish - A highly popular fish in Malaysia, this fish is sold at 250 grams only, making it a very fast producer. Presented as an example of a small fish type; local equivalent may be identified for china market.

9, 10 & 12 are typical south Asian species. The species will change to marketable North American species.

11. Nile Perch It is a very popular fish in Middle East countries and Egypt. This fish is also in good demand in EU, fetching high prices.

Productivity & Profit by Type of Fish

Planned Fish Species: Tilapia for Whole Fish or Fillets

TilapiaFingerlings EggsfromTilapia

MaleTilapiaColours

TilapiaFingerlings

TilapiaEggsHatching

Raising organic tilapia can be effected when there is a profuse and sustained growth of algae, bryophytes, (mosses, liverworts, and hornworts, etc.) phytoplanktons, phytoplankton use CO2 for survival, which means that the more phytoplankton there are, the more CO2 will be sucked out of the air and zooplanktons in the natural habitat of the fish. Enhanced growth of these natural foods of the fish also results in the

production of an ample supply of dissolved oxygen that tilapia needs. That is the objective of our Periphyton room.

To promote the growth of these natural foods, OAF is applied four weeks before the fingerlings are dispersed into the RAS system. They are fed a ready supply of natural foods in the system. By feeding the fingerlings daily with OAF in addition to the prepared vegetable food, the month-old tilapia grow fast, gain weight quickly, and develop their immune system.

Planned Fish Species: Tilapia

Processing & Productivity

To illustrate the potential of the technology, we will use a typical 30 Hectares production project producing several fish species adapted to South-East Asia market, as this economic model has been developed for this part of the world; these production choices and numbers should be further adapted to Montana

market. The proposed fish production plant comprises 30 X 1 Ha Modules with a projected 720 production pools, on a 40 Ha land.

We do not recommend to start with such a diversified production and so large a scale, but we use this example to demonstrate the differences between different types of fish. The actual strategy towards the Canadian market needs to be further discussed, but it appears certainly wise to start relatively small and expand as market penetration is established.

When selecting sites, it will be important to keep in mind future expansion needs in terms of land, water and electricity capacity.

HydroNov’s Recirculating Aquaculture System ( RAS ) offers the flexibility to schedule the production of fish species according to market demands.

A detailed permutation of the number of modules and pools for the various species to maximize production and profitability can be carried out mathematically.

The following allocation of number of modules and pools per specie on this page are just examples of fish species that can be grown in HydroNov’s RAS. They are by no means fixed. New species are being adapted to aquaculture every year

Modules PoolsMonths

per CycleCycles per Year (gr)

SizeProduction

(metric tonnes)

1 Rainbow Trout 1 24 9.0 1.25 600 1,101

2 Arctic Char 1 24 9.0 1.25 600 1,101

3 Murray Cod 1 24 9.0 1.25 800 756

4 Jade Perch 1 24 9.0 1.25 800 756

5 a: Tilapia 2 48 4.8 2.50 600 5,842for fresh market

5 b: Tilapia 8 192 6.0 2.00 900 16,862for filleting

6 Barramundi 3 72 8.0 1.50 700 3,334

7 Silver Catfish 2 48 6.0 2.00 600 2,016

8 Catfish 3 72 1.5 8.00 250 12,700

9 Ikan Sepat 2 48 5.0 2.25 150 3,572

10 Nile Perch 3 72 9.0 1.25 600 3,302

11 Marble Goby 1 24 12.0 1.00 1200 339

12 River Carp 2 48 10.0 1.20 1500 1,654

30 720 53,335

Fish Species

Construction Costs

CONCRETE FOR POOL STURCTURE HYDRONOV 1 96POOL LINER HYDRONOV 1 96WATER CIRCULATION PUMPS HYDRONOV 8 768UV FILTER HYDRONOV 2 192DRUM FILTER HYDRONOV 2 192VORTEX & FECAL TRAP HYDRONOV 2 192BIOFILTER MEDIA HYDRONOV 2 192OXYGEN EQUIPMENTS HYDRONOV 2 192DEGASSING SYSTEM HYDRONOV 2 192SEPARATION GRILL HYDRONOV 12 1152RECIRCULATION HEATING / COOLING ecoPHASER 0NEW WATER DISTRIBUTION HYDRONOV 2 192RECIRCULATION PIPING & FITTINGS HYDRONOV 2 192WALKWAY GRATING HYDRONOV 1 96

TOTAL THIS SECTION 13,749,120

GENERAL PURPOSE EQUIPMENT

ELECTRICAL DISTRIBUTION FOR EQUIPMENT HYDRONOV 1 systemPRIMARY WATER TREATMENT HYDRONOV 1 systemBACTAPUR, EGGS, FEED, (3 MONTHS) HYDRONOVWATER DISTRIBUTION HYDRONOV 1 systemO2 TANK RENTALPOOL DRAINAGE HYDRONOV 1 systemEQUIPMENT INSTALLATION & START-UP HYDRONOVCASUAL LABOUR FOR SYSTEM INSTALLATION HYDRONOVSPECIALIZED INSTALLATION HYDRONOVCOMPUTER CONTROL & MANAGEMENT HYDRONOV 1PURIFICATION POOLS HYDRONOV 6HATCHERY & LABORATORY HYDRONOV 1 systemPRE-PRODUCTION POOLS HYDRONOV 6TRANSPORT & MISCELLANIOUS HYDRONOVAUTOMATIC FEEDING SYSTEMS HYDRONOV 4 systems


TECHNOLOGY & TECHNICAL SUPPORT

DESIGN & CONSTRUCTION DRAWINGS HYDRONOV IncludedEQUIPMENT SELECTION & BUYING HYDRONOVPROJECT MANAGEMENT & TECHNICAL SUPERVISION HYDRONOVPRODUCTION START-UP & 1 YEAR SUPPORT PERIOD HYDRONOV

TOTAL THIS SECTION

TOTAL GROWING SYSTEM & PRODUCTION SUPPORT 19,335,120

BUILDING & INFRASTRUCTURE

MAIN WATER SUPPLY & STORAGE LOCAL BudgetELECTRICAL TRANSFORMER ecoPHASER BudgetELECTRICAL MAIN PANEL & BACK UP GENERATOR ecoPHASER BudgetSITE PREPARATION & DRAINAGE BEP Engineering BudgetFISH PRODUCTION BUILDING BEP Engineering BudgetSERVICE BUILDING BEP Engineering BudgetCONCRETE & INSTALLATION BEP Engineering BudgetOPTIONAL WATER HEATING/COOLING ecoPHASER BudgetOPTIONAL O2 GENERATOR ecoPHASER BudgetPROCESSING & PACKAGING EQUIPMENT ecoPHASER BudgetCOOLING, FREEZING, SMOKING EQUIPMENT ecoPHASER BudgetSLUDGE WATER PROCESSING ecoTECH Budget


4 HA Fish Project 24,015,120$

GROWING SYSTEM: FISH Production RESPONSIBLE # / Project# / Pool

Investment Costs

1 HECTARE PROJECT (108,000 ft2) A TYPICAL INVESTMENT BUDGET FOR A HYDRONOV AQUACULTURE SYSTEM

product/species MODULE

WATER PER POOL M3 160

PRODUCTIVITY/M3 #KG 450#KG

POOLS 1PER POOL / YEAR #KG 72,000

#FISH 120,000PER HA / YEAR #KG 1,728,000 Eu. Exchange Rate

1.486

ITEMSUNIT COST

QUANTITY COST USD

FINGERLINGS (Units) $0.18 132,000 $23,538FEED (KG) $1.49 79,200 $117,691ELECTRICITY (kW/Hr) $0.10 300,000 $31,206OXYGEN (kH/Hr) $0.10 30,855 $3,210HEATING (per cubic metre) $0.52 20,000 $10,402

$186,047$2.58

LABOUR & TECHNICAL SUPERVISION $29,411Labour cost per kilogram of sold production $0.41

$215,458All‐in cost of production pr kg. $2.99

SELLING PRICE per KG $5.20

$374,472

GROSS PROFIT (CASH FLOW MARGIN PER POOL PER YEAR)

$159,014

NUMBER OF POOLS THIS SPECIES & PRODUCT TYPE

24TROUT 600 Grams

GROSS PROFIT ‐ THIS SPECIES & PRODUCT TYPE

TROUT 600 Grams

$3,816,339

20$8,916,000 $445,800

$185,750$185,750

INTEREST & FINANCE COSTS 6% $6,687,000 $401,2206% $2,229,000 $133,740

TOTAL $1,352,260

NET PROFIT FOR 1 product/species MODULE

TROUT 600 Grams

$2,464,079

FISH RECIRCULATION TECHNOLOGYTYPICAL PRODUCTION COSTS / ($US)1 module per year of production

TROUT 600 GramsDIRECT COSTS PER PRODUCTION POOL

TOTAL DIRECT COSTS PER YEAR

INDIRECT & OVERHEAD COSTS

Costs per kilogram of sales this fish product

COST OF OPERATIONS (Total Cost of Cash‐flow)**TROUT 600 Grams

**= Excluding sales & marketing costs

TOTAL SALES PER POOL PER YEAR

INDIRECT & OVERHEAD COSTSAmortization # years (straight line)

Amortization

Factory Overhead** Sales & Administration






1.486

ITEMSUNIT COST

QUANTITY COST USD


$163,888$2.81


$188,964All-in cost of production pr kg. $3.24


$347,130


$158,166


24ARCTIC

CHAR 1 kg.GROSS PROFIT - THIS SPECIES & PRODUCT TYPE

ARCTIC CHAR 1 kg.

$3,795,975

20$8,916,000 $445,800

$185,750$185,750


TOTAL $1,352,260


ARCTIC CHAR 1 kg.

$2,443,715


ARCTIC CHAR 1 kg.DIRECT COSTS PER PRODUCTION POOL





COST OF OPERATIONS (Total Cost of Cash-flow)**ARCTIC CHAR 1 kg.




Amortization

Productivity & Profit by Type of FishIN THESE EXAMPLES, 4 SPECIES ARE DEMONSTRATED FOR PRODUCTIVITY AND PROFIT PER TYPE. FROM THE MIX DECIDED

FOR THE FACILITY, FULL FEASIBILITY CAN BE DETERMINED.

Examples: Hereunder are current performance forecasts based on actual results, for a hypothetical 4 module system using HydroNov proprietary fish rearing technology.






1.486

ITEMS UNIT COST QUANTITY COST USD


$142,022$2.22




$309,088


$140,752


24TILAPIA 600

GramsGROSS PROFIT - THIS SPECIES & PRODUCT TYPE

TILAPIA 600 Grams

$3,378,048

20$8,916,000 $445,800

$185,750$185,750


TOTAL $1,352,260


TILAPIA 600 Grams

$2,025,788



TILAPIA 600 GramsDIRECT COSTS PER PRODUCTION POOL



COST OF OPERATIONS (Total Cost of Cash-flow)**TILAPIA 600 Grams




Amortization







1.486

ITEMS UNIT COST QUANTITY COST USD


$138,495$2.89




$320,976


$159,262


24BARRAMUNDI

600 GramsGROSS PROFIT - THIS SPECIES & PRODUCT TYPE

BARRAMUNDI 600 Grams

$3,822,289

20$8,916,000 $445,800

$185,750$185,750


TOTAL $1,352,260


BARRAMUNDI 600 Grams

$2,470,029



BARRAMUNDI 600 GramsDIRECT COSTS PER PRODUCTION POOL



COST OF OPERATIONS (Total Cost of Cash-flow)**BARRAMUNDI 600 Grams




Amortization


Productivity & Profit by Type of Fish

The figures shown are in US Dollars ($USD). The net profit per annum in this 96 pool example, (rearing 4 species of proven saleable fish) is $9,403,610 for ROI of 105.5% per annum with a 25:75 equity to debt ratio, or, allowing for full amortized cost, ROI of 2109% during the 20 year life of the project. After that

time, an annual return of over $18 m, or 51% ROI will occur for the duration of the project life. We expect a refit at 25 years, plus expansion growth during the project not included here.

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