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Virginia Biodiesel Conference November 16, 2004 Bob Gray, Sales Director Mid-Atlantic

Virginia Biodiesel Conference November 16, 2004 Bob Gray, Sales Director Mid-Atlantic. World Energy Provides Biodiesel Expertise. Supplier for most American fleets Largest Military Supplier Largest biodiesel capacity in the U.S. Strategically allied with Gulf Oil

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Virginia Biodiesel Conference November 16, 2004 Bob Gray, Sales Director Mid-Atlantic

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  1. Virginia Biodiesel ConferenceNovember 16, 2004Bob Gray, Sales Director Mid-Atlantic

  2. World Energy Provides Biodiesel Expertise • Supplier for most American fleets • Largest Military Supplier • Largest biodiesel capacity in the U.S. • Strategically allied with Gulf Oil • Nation-wide distribution network • Longest cold-weather experience

  3. World Energy Delivers… • World Energy sources from multiple production facilities including our own Purada facility in Lakeland, FL. • All product meets ASTM-6751 biodiesel standards and is subject to World Energy quality control. (cold flow) • Product is transported in insulated, steam-coiled jumbo railcars to rail distribution nodes across the U.S. • Petroleum transport vehicles deliver B100 and blended products to distributors and end users.

  4. Biodiesel Production Facilities

  5. Biodiesel Potential Current Potential: 1.7 Billion gals./biodiesel • Displaces 5.5% of national on-hwy. demand. Near-Term Potential: (2015): 3.5 Billion gals./biodiesel • Displaces 7% of national on-hwy. demand. Long-Term Potential: (2030): 10 Billion gals./biodiesel (Source: NREL; Biomass Oil Analysis: Research Needs & Recommendations. June 2004)

  6. Biodiesel Production: Current v. Capacity • Current Biodiesel Industry Production (*NBB) FY 2003: 25 million gallons FY 2004: 30 million gallons (estimated) • Current physical/engineering production capacity, which includes dedicated biodiesel plants and oleochemical companies producing biodiesel, is estimated to be between 150 and 200 million gallons per year. • Current practical capacity is closer to the 50 million gallons range due in part to complicated limitations within the production system.

  7. Current Market: Military • Langley AFB • Peterson AFB • Camp Pendleton USMC • The US Navy • Scott AFB • Wright-Patterson AFB

  8. Current Market: Government/Municipal • Transit of Northern Kentucky • The U.S.P.O. • U.S. Dept. of Agriculture • North Carolina, Ohio, Michigan DOT’s • The States of Alabama, Oregon • Las Vegas fleets- city, school, etc.

  9. Current Market: Utilities • Commonwealth Edison • San Diego Gas & Electric • Florida Power & Light • Alabama Power • Georgia Power • Reliant Energy • Dominion and FirstEnergy

  10. Current Market: Sensitive Locations • Everglades NP • Yellowstone NP • Northstar at Tahoe • Glacier NP • Breckenridge • Channel Islands

  11. Emerging Markets and Opportunities for Growth • Federal Tax Credit and State Incentives • Fuels Regulation • ULSD markets • Colder Temperature Operations • Static Engine Operation • Heating Oil • OEM’s

  12. Federal Biodiesel Tax Credit • The new law takes effect Jan. 1, 2005. • Regulations for the implementation of this law are not yet written. • Creates a tax credit for biodiesel • $1 per gallon tax credit for each gallon of pure biodiesel made from virgin oils derived from agricultural products and animal fats • $.50 per gallon tax credit for each gallon of pure biodiesel made from other oils • All gallons allow the credit to be claimed in both taxable and tax-exempt markets • Tax-exempt fleet fuel programs • Off-road diesel markets (dyed diesel) • Heating oil, Boiler Fuel, Power Generation • Streamlines the use of biodiesel at the terminal rack • The tax structure and credit will encourage petroleum blenders to blend biodiesel as far upstream as possible, which under the RFS or Minnesota’s 2% volume requirement will allow more biodiesel to be used in the marketplace

  13. Meet EPA 2006 Standards for Ultra Low Sulfur Diesel • Soy Biodiesel at 0-1 ppm sulfur. • Specify 15 ppm standard for blend • Zero aromatics • Lubricity • Extender

  14. Cold Weather Performance • Biodiesel realizes cold temperature operability issues faster than most petroleum diesel • Untreated B20 freezes 2-5 °F faster than #2 petroleum diesel, depending on: • the cold flow properties of the biodiesel • the cold flow properties of the petroleum diesel • The same precautions taken with petroleum diesel can be used to ensure operability with biodiesel: • Utilization of an additive that enhances cold flow properties • Blending with kerosene • Storage of the vehicles in or near a building when not in use

  15. Engine Manufacturers • B100 Must Meet ASTM D 6751 • Diesel Must Meet ASTM D 975 • Most Engine OEM’s have B20 experience: • Won’t void warranty • OEM’s don’t make fuel and they don’t warrant fuel • Pressure must be put on OEM’s to recognize the use of biodiesel

  16. Energy Security:Reduce Petroleum Dependence • Energy consumption predicted to increase 40% and 54% between now and 2025 (~20 years) in the US and World, respectively • China and India will begin to consume large quantities of petroleum as they enter the world economic picture • Without question, this amplifies the need for the US to produce our own energy supplies.

  17. www.worldenergy.net Bob Gray Mid-West and Mid-Atlantic U.S. 628 Angiline Drive Boardman, Ohio 44512 Office 330.629.2440 bobg@worldenergy.net

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