entrepreneurs de la bioéconomie fbi/sittm technologies

Entrepreneurs de la bioéconomie

FBi/SITTM Technologies

04/19/23FBi Forest BioProducts Inc. 2

The bioeconomy: a new economic cycle

What’s Next?

HuntingAgrarian

Industrial

Information


Markets of the Bioeconomy

• Biofuels $80 B (potential Canada)

• Bioplastics $10 B (potential Canada)

• Pharmaceuticals $40 B (Canada)

• Nutraceuticals $100 B (world)

• Biopesticides $ 1 B (potential Canada)

• Food from the forest $675 m (actual)

• Consumer goods from forests $125 m (actual)

Governments are promoting bioeconomy—5-10 year planning horizon

• Climate change is a recognized global issue—link to fossil fuels

• Country wide legislations compelling the use of biofuels:o Reduce carbon emissions

o Stimulate regional economies

o Clean air policies

• Municipal governments are getting involved to support community survival



Scientists are promoting bioeconomy—20 year planning horizon

Four presentations about entrepreneurship in the bioeconomy

• Presentation 1: the financial argument

• Presentation 2: the academic argument

• Presentation 3: the corporate argument

• Presentation 4: the psychological argument


Presentation 1: The financial argument

• Numerous bioproducts opportunities each with unique:

• Rate of return on capital invested

• Capital investments $1-10,000,000

• Cash flow

• Equity/debt ratios

• Private and public financing

• Business plans

• Sustainability of resources—long term procurement strategy

• Corporate structuring/accountability

• Payback period—2-10 years04/19/23FBi Forest BioProducts Inc. 7

Non Timber Forest Products


Opportunity InvestmentReturn on

InvestmentJobs

CreatedRisk Factor

Ground hemlock $200,000 5-10%>20

seasonalLabour, accessibility of resource in the region

Fiddlehead ferns $25,000 50-75%>10

seasonalLabour, market demand, buyer prices

Wild mushrooms $50,000 5-30%>10

seasonalLabour, market demand, buyer prices

Wild blueberries $0 to $100,000 5-10%>10

seasonalLabour, market access, available land

Birch syrup $50,000 50-90% 3 seasonalMarket demand, buyer prices

Energy Sector Opportunities



InvestmentJobs

CreatedRisk Factor

Biodiesel $2,000,000 25-50% 5 full-timeFeedstocks and markets must be secured

Energy crops and natural fibres

variable 5-15% Part timeNeeds to be supported by local research to assess productivity

Creating energy conservation communities

$100,000 10-30% 2 full timeNeed to secure subsidies for start up

The wild side



InvestmentJobs

CreatedRisk Factor

Cultivation of specialty plants (marijuana) in mine shafts

$2,000,000 5-15% 5Must be associated with operating mine or must be dry shafts


Presentation 2: academic argument

• To private sector: Small scale, decentralized bioeconomy businesses are emerging

• To governments: Foolishness is the act of repeating the same mistakes while expecting better outcomes

• To NGO’s: New approaches based on the democratization of knowledge are emerging because the most critical energy decisions will be made at Home Depot stores at 10:17 on Saturday mornings

Presentation 3: corporate argument

• Let’s invent “Maudit Bon Monde Inc” (MBMI)

• 100 shareholders

• Bioeconomy business

• MBMI’s First Shareholders Meeting

• Two investment opportunities: o Now at $10.00/share

o Later on the presentation at $ ?/share (my choice).


MBMI’s First Shareholders Meeting

• Let’s invent “Maudit Bon Monde Inc” (MBMI)

• 100 shareholders

• Our goal: increase shareholder value to $1 B within 5 years

• Our vision: capitalize on trends in the bioeconomy—particularly energy sector

• Our values: the bioeconomy can be used to generate profit while benefiting humankind

• Goal of meeting: find market focus, technology & implementation strategy


How to position MBMI: energy

• CIPO: 1080 patents on biomass transformation

• Google search:o 15,200,000 hits on biomass

o 6,220,000 hits on biofuels

o 850,000 hits on bioenergy solutions

• Bioeconomy is being introduced


What we have to do to be credible

• Outstanding management team with accountabilities

• Protection of Intellectual Property

• Enough cast to support cash flow requirements

• Regulatory issues-labor, environment, electrical…

• Shortest distance between a good idea and making money



Hubbert’s Peak is ushering bioeconomy

• The amount of oil under the ground is finite

• Pre-peak: rapid rise – discoveries & infrastructure

• Post-peak: rapid decline – resource depletion


Energy facts

• One barrel of oil: 6.1 Gigajoules--$10/GJ• One car/light truck= 34, 43, 52 GJ/year• Steel fabrication: 18 GJ/tonne • Paper fabrication: 24 GJ/tonne• One dry tonne of biomass= 18 GJ• Panicum (switchgrass) = $8/GJ• One house = 116 GJ/year

o Space heating 70 GJo Hot water heating 25 GJ

• 4 % of Canada’s energy comes from biomass


Overview of biofuel technologies

• Fermentation (Corn, wood—ethanol)

• Combustion (all biomass types)

• Gasification (all biomass types)

o Pyrolysis—bio-oil

o High temperature—syngas

o Catalytic conversion to methanol, biodiesel, ethanol

• Transesterification process-fats to biodiesel

• Wood pellets, chips


Bioeconomy market failures (things we don’t want MBMI to do)

• IPO syndrome-they will buy it because it’s green

• To access markets, bioproducts (bioenergy) must be:

o Cost-effective in comparison to fossil fuels

o Trouble-free for consumers

o Be culturally acceptable

o Have the same distribution infrastructure as fossil fuels

• Commoditization of feedstocks

• Must underwrite less than two of the above risk factors

Technology size-where is there potential for revenues?

• Large scaleo Address large markets, own and operate

green energy technologies• E.g Atikokan Generating Station

• Small scaleo Fit technology to end users, sell and/or

license technology• E.g. small scale biodiesel manufacturing



Stick it to the ManTM

• The Frankentank v.2


The Frankentank v3

• Patent pending (CIPO)

• ESA/CSA pending

• 220 V, single-phase

• 250 L batch in 8 hours

• 2 hours hands-on-time

• Dry-wash technique

• Methanol recovery

• Spill containment


Feedstock

Volume (L) 250 250

% FFA 0% 5%

% MIU 0% 1%

Reactants

Triglycerides (kg) 220 207

Methanol (L)a 50 47

Catalyst

KOH (kg) 1.4 3.6

Products

Biodiesel (L)b 245 235

Glycerol (L) 22 21

Excess methanol (L)c 19 18

Soap (L)d 0 13

Total byproduct (L) 36 48

a - methanol is added at 18% w/w of triglyceride

b - 95% conversion of fat to biodiesel

c - 25% of XS in raw biodiesel; 75% in byproduct

d - 100% conversion of fatty acids to soaps

Canola Oil WVOAmount Cost Amount Cost

Feedstock (L, $/L) 250 $0.05 250 $0.00

Total ($)

Methanol (L, $/L) a b 50 $0.92 47 $0.92

Total ($)

Potassium Hydroxide (kg, $/kg) 1.4 $2.70 3.6 $2.70

Total ($)

Cleaning Powder (kg, $/kg) 1.0 $2.50 1.0 $2.50

Total ($)

Filter Bags (ea, $/ea) 2 $4.00 2 $4.00

Total ($)

Electricity (kWh, $/kWh) 16 $0.06 16 $0.06

Total ($)

TOTAL ($)

TOTAL ($/L)

a - methanol is bought at $1.25 per L

b - 70% of excess methanol is recovered

$1 $1

$46

$11 $0

$0.30 $0.27

$73 $64

$8 $8

$4 $10

$43

$3 $3

Canola Oil WVO

A few Frankenthoughts

Market opportunity

• Permit fuel/users to invest in technology to meet their needs/regional needs

• Reduce transport costs of biomass

• Take advantage of o Emerging gasification

o Emerging biodiesel

o Emerging biooil technologies


Business opportunities: social entrepreneuship

• Development of technologies to fit the Democratization of Energy/Knowledge

• Deployment and operations of small scale technologies

• Working with communities to support their needs

• Managing the development process—there is no consulting firm out there that that can provide the ultimate consultant out there

o Project definition/management/delivery



Why biodiesel is the buzz

$0.40

$0.60

$0.80

$1.00

$1.20

$1.40

$1.60

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Pu

mp

Pri

ce

- D

ies

el

($/L

)

• Diesel price increasing at $0.12 per L per year in Ontario

• 5 % biodiesel target in Canada

• Culturally acceptable


Diesel in Canada - 2004

Residential Industrial cont…

Space heating 2,789,000 2,789,000 Petroleum Refining 16,000 336,000 352,000

Commerical/Institutional - Cement 5,000 5,000

Wholesale Trade 12,000 8,000 20,000 Chemicals 53,000 53,000

Retail Trade 32,000 21,000 53,000 Iron & Steel 189,000 189,000

Transportation & Warehousing 36,000 10,000 46,000 Other Manufacturing 43,000 43,000

Information & Culture 106,000 12,000 118,000 Forestry 10,000 - 10,000

Offices 240,000 81,000 321,000 Mining 93,000 1,000 94,000

Education Services 59,000 7,000 66,000 Transportation -

Health Care & Social Assistance 54,000 7,000 61,000 Passenger Transportation 1,724,000 1,724,000

Arts, Entertainment & Recreation 17,000 2,000 19,000 Freight Transportation 17,874,000 1,645,000 19,519,000

Accomodations & Food 37,000 16,000 53,000 Off-Road 761,000 64,000 825,000

Industrial - Agriculture -

Construction 332,000 332,000 Motive & Non-Motive 2,224,000 324,000 19,000 2,567,000

Pulp & Paper 23,000 189,000 212,000 Electricity Generatiion -

Smelting & Refining 1,000 1,000 Electricty Generation 166,000 3,864,000 4,030,000

Petroleum Refining 16,000 336,000 352,000 TOTAL 22,583,000 4,362,000 6,909,000 33,854,000

DFO = Diesel Fuel Oil

LFO & KER = Light Fuel Oil & Kerosene

HFO = Heavy Fuel Oil

SectorDFO

(103 L/yr)

LFO & KER

(103 L/yr)

HFO

(103 L/yr)

TOTAL

(103 L/yr)Sector

TOTAL

(103 L/yr)

HFO

(103 L/yr)

LFO & KER

(103 L/yr)


20 cSt – Max Viscosity

Temperature (ºC)

Vis

co

sit

y (

cS

t)

Vegetable Oil

Diesel

Biodiesel

Viscosity-Temperature Curves


The Biodiesel Reaction is simple

1) Waste Vegetable Oil

2) Raw Biodiesel (A)and Crude Byproduct (B)

3) Purified Biodiesel

A

B


Quality Standard – ASTM D6751

Flash Point 93 130 min. degree C Water & Sediment 2709 0.05 max. vol. %Carbon Residue 4530 0.05 max. wt. %Sulfated Ash 874 0.02 max. wt. %Kinematic Viscosity (40ºC) 445 1.9 - 6.0 mm²/sec. Sulfur 5453 0.05 max. wt. % Cetane 613 47 min.Cloud Point 2500 By Customer degree C Copper Corrosion 130 No. 3 max.Acid Number 664 0.80 max. mg KOH/g Free Glycerin 6854 0.02 wt. % Total Glycerin 6854 0.24 wt. %Phosphorous 4951 10 max ppm Distillation 1160 360 max degree C

PropertyASTM Method

Limits Units


Tailpipe Emission Reductions

US DOE – National Renewable Energy LabLow Sulfur Diesel vs. B20 (October, 2006)


Energy Return on InvestmentRegular Diesel

Domestic Crude Production 0.573 48%

Foreign Crude Production 0.540 45%

Domestic Crude Transport 0.003 0%

Foreign Crude Transport 0.013 1%

Crude Oil Refining 0.065 5%

Diesel Fuel Transport 0.006 1%

TOTAL 1.201 100%

Biodiesel

Soybean Agriculture 0.066 21%

Soybean Transport 0.003 1%

Soybean Crushing 0.080 26%

Soy Oil Transport 0.007 2%

Soy Oil Conversion 0.151 48%

Biodiesel Transport 0.004 1%

TOTAL 0.311 100%

StagePrimary Energy

(MJ per MJ)Percent

StagePrimary Energy

(MJ per MJ)Percent

Fossil Energy Ratio = Energy In

Energy Out

FER Diesel = 0.83

Fossil Energy Ratio = Energy In

Energy Out

FER Biodiesel = 3.22

Energy Density of Diesel = 36 MJ/L

Energy Density of Biodiesel = 33 MJ/L


Biodiesel – Tax AdvantagesCanada-Wide Road Tax on Diesel

BC – B5-B50 15.0 ¢/L exemption

MB – 11.5 ¢/L exemption

ON – 14.3 ¢/L exemption

QC – 16.2 ¢/L exemption

NS – 15.4 ¢/L exemption

PEI – 20.8 ¢/L in discussions

AB – 9.0 ¢/L no exemption

SK – 16.5 ¢/L no exemption

NB – 16.9 ¢/L no exemption

NFL – 16.5 ¢/L no exemption

YK – 9.1 ¢/L no exemption

NWT – 7.2 ¢/L no exemption

NU – 9.1 ¢/L no exemption

11.5¢15.0¢

Long term business strategy

• Develop market for product –5 continents

• Create a distribution system for Stick-it-to-The ManTm technologies

• Secure partnerships to develop new technologies/products

• Acquire companies with complementary technologies

• Create manufacturing strategies worldwide

• New venture: manage process for other businesses.


Business opportunity: managing the development process on behalf of private sector/communities

• Idea to market

• Reducing technology risks

• Reducing market risks

• Finding the right talent to support small businesses

• Finding subsidies to support small businesses


Psychological argument: risk and benefits

• Goal is $1 B in value

• 75 % grants and loans from governments

• Massive worldwide opportunities

• Great management team

• Current share value: $10/share—because we still are not certain to have success


Businesses are convergence of systems:

• Resource

• Technology

• Markets

• Financial parameters

• Corporate structure

• Psychology (testicular fortitude)


entrepreneurs de la bioéconomie fbi/sittm technologies

Documents

fbi forest bioproducts

actual slide

bioeconomy presentation

academic argument presentation

timber forest products

seasonal labour

seasonal market demand

opportunityinvestment