Spoke and Hub Distributed Production of Methanol A New Paradigm for Production of Alternative Chemicals and Fuels

BioEnergy SymposiumMay 14, 2015 | Charlotte, NC

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Maverick SynfuelsConverting ‘stranded’ feedstocks into chemicals and fuels• Transportable and marketable methanol• Low risk, proven technology• Capital efficient

AGENDA• Who is Maverick• Problem – waste carries a

cost for handling and removal• Convert to higher value

products• Technology• Feedstock arbitrage• Conclusions

Global Waste: A Problem to SolveLow-volume, predictable supply, and lower cost

• Waste is on the rise• Cost and regulatory constraints

with waste disposal• Growing environmental issues• Waste is widely distributed and

difficult/expensive to aggregate• ‘Pockets’ of waste are hard to

access and difficult to convert economically

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Northwestern North Dakota is home to the Bakken shale formation, where fracking has led to an oil boom. Most of the bright lights are natural gas from wells being burned because the region lacks the infrastructure to pipe all the gas away. Gas production has increased rapidly in recent years but 30 percent is flared. (Andy Rowell from Oil Change International)

Image: NASA Earth Observatory image by Jesse Allen and Robert Simmon VIIRS/SUOMI

Abundant Feedstock Supply

Anaerobic digester gas – EPA Agstar– Average 225,000 ft3/day (SCFD) of biogas– 193 listed, 81 provided estimated output,

23 >250,000 SCFD

Associated gas– 35,000 to 40,000 wells in Bakken each

producing associated (flare) gas

MSW and industrial waste– Average landfill ~ 200 tons per day– More than 3,000 in US– Landfill gas (active landfills only)

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Trends in Anaerobic Digester/Biogas Environment

• Need to reduce waste and handle it better

• Electricity rates (Power Purchase Agreements) are declining

• New and anticipated regulations are encouraging more AD deployments

• Seeking alternative uses of biogas• Need revenue streams to offset the cost

of AD• Lack of capital for investment in AD

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Why Convert Methane to Methanol?

• Vast reserves of methane, both biogas and natural gas (NG), cannot economically be distributed to local energy markets.

• Conversion of waste gas into transportable liquid fuels and chemicals monetizes these underutilized reserves.

• Superior revenue potential compared to wholesale NG and electricity generation.

• Methanol is valued commodity in remote and undeveloped areas.

• Congruent with existing industry and business models.

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Revenue available to venture from 1 MMBTU Natural Gas Equivalent

Advantages of MethanolRelatively easy to produce and store at remote locations

– Liquid at ambient temperature – Transported to market via conventional methods (truck, rail, barge, etc.)

Important intermediate for synthesis of high-value products– Chemicals– Clean fuels

Existing and growing market – Anti-freeze/solvent– Olefins (ethylene & propylene)– Formaldehyde (resins)– Blended or direct use of methanol as a fuel (M15, M85, M100 and fuel cells)– DME ( a diesel and LPG substitute) – Further synthesis to diesel or jet fuel

Methanol blends make superior fuels– Improve combustion– Increase octane– Burn cleanly– Reduce emissions

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Methanol

• Methanol Market– Over 65 M metric tons worldwide

• Nearly 7 M metric tons US (over 2 Billion gallons)– Chemical commodity

• Starting material for many chemicals• Biodiesel industry (~5% of US market, 100 M gallons)

– 5th most widely traded commodity– Growth rate in excess of 5% year over year

• Upgrade methanol to other products at future hubs, if incremental economic opportunity exists

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Spoke and Hub Distributed Production

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Olefinity™ Technology - Methanol

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Methanol is Sellable and Transportable

Maverick Oasis™ Product Line

• Description: Small-scale modular plant• Feedstock: Natural gas or methane-rich gas• Deployment: Co-located with anaerobic

digesters; remote oil and gas fields; landfills• Capacity: 3,000 – 10,000 gallons per day• Output: Methanol (performance guaranteed)

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Features• Feedstock flexible; aggregation

capable• Skid-mounted, small footprint• Factory built by PPE

Advantages• Co-location with feedstock• Lower CAPEX / operating costs• Quick deployment• Transportable intermediates

Benefits to feedstock provider• New source of revenue• Alternative to flaring or

generating electricity• Environment friendly

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Uses smaller plants based on known processes– Eliminate technical risk– Integrate proven technologies– Reduce implementation risk

Reduces capital requirements and accelerate return on investment– Phased build-out of spokes in Spoke and Hub model– Smaller plants (spokes)– Sellable ‘intermediate’ leads to quick revenue

Increases sources of feedstock and reduces feedstock price pressures– Lock in “point of source” feedstock supplies – synergistic co-location– Reduce “self competition” (within an economic geography) for feedstock

which drives up prices– Enable access to “economically stranded” feedstock– Implement a flexible feedstock model

Advantages of Spoke and Hub Distributed Production

Spoke and Hub Deployment Economics• Access and convert pockets of feedstock• Not available to other producers needing a large feedstock supply

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Spoke and Hub enables "feedstock arbitrage" by converting pockets of low-cost feedstock to

high-value products at market price

Spoke and Hub Model

Conclusion

• Solves multiple problems– Waste reduction and handling– Reduce/eliminate environmental issues– Improve local economies/reduce

dependence upon petroleum

• Produces products that have local value

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• Uses known technologies– Reduces operating expenditures– Transportable intermediates

• Reduce capital requirements• Reduces risk

– Financial– Technical

Contact Maverick

Business Opportunities For Strategic Partners• Licensing Maverick OasisTM technology• Building and operating production plants

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For More Information:

www.mavericksynfuels.com

Sam YenneCEO

syenne@mavericksynfuels.com(919) 749-8717

Eric CummingVP of Corporate Development

ecumming@mavericksynfuels.com(919) 341-4208