Com 2007(18) - Stakeholders meeting Kees Hettinga Sabic Europe Walter Mirabella Lyondell Chemical Europe Com 2007(18) - Stakeholders meeting Brussels, Belgium 29th May 2007

BioFuels Evaluated on CO2 Fuel Quality Directive Review Proposal Requiring Accurate CO2 Evaluation of Fuels EU MSs Targeting BioComponents CO2 Performance: GERMANY (meo/IFEU) NETHERLANDS (Cramer Committee) UNITED KINGDOM (Low Carbon Vehicle Partnership)

Why a new evaluation for EtOH/EtBE? ETBE Currently Key to EU ETOH Blending Address CO2 Impact Triggered by Refinery Optimisation after Adding EtOH and/or EtBE Focus on Comparing the two Ethanol “forms” within the refinery Addressing “middle-man” Misconception: “Extra processing step costs energy, therefore CO2 emissions expected to be larger with ETBE than for ethanol direct blending” Demonstrate Reality: ETBE allows lower Carbon intensive blend stock, saving CO2

“Bio-Petrol”: Etherification Central in the Supply Chain Bio-Mass (Agriculture) Ethanol (Distillation) ETBE (Etherification) Refinery (Formulation) Distribution (Consumption)

>3/4th of EU Bio-Ethanol Blended Today as ETBE “Forms” of Ethanol: >3/4th of EU Bio-Ethanol Blended Today as ETBE

CO2–Related Factors Affected by Refining Gasoline composition H/C ratio (Aromatics, olefins, lights) Processing fuel consumption Octane-production/energy-use correlation Indirect effects Changed refinery output due to other optimization

Octane/Refinery Fuel Use Correlation: Long Known Factor Source: CONCAWE’s “RUFIT” report N° 6/78 (dec 1978)

Study Basis Refinery modeling performed by consultant Main refinery products constant on energy basis Time base-line 2010 Base petrol summer grade with no bio-components Compare ethanol directly blended vs. ETBE Ethanol is “smart” blended

Different ETOH Blending Options

Theoretical ETOH CO2 Performance Basis CH3-CH2-OH + 3O2 = 2CO2 + 3H2O 46.07 44 5500 10506 50% 5253

CO2 Scenarios Comparison: Detailed Relative Contribution A = Ethanol 5%v/v & MTBE export, B = Ethanol 5%v/v & MTBE to iC8=, C = Existing MTBE converted to ETBE + ETOH-DB to %5v/v D = Existing MTBE + Available iC4 converted to ETBE + ethanol to 5%v/v E = As above + Incl nC4= isomerisation then to ETBE

CO2 Scenarios Comparison: Overall Relative Contribution A = Ethanol 5%v/v & MTBE export, B = Ethanol 5%v/v & MTBE to iC8=, C = Existing MTBE converted to ETBE + ETOH-DB to %5v/v D = Existing MTBE + Available iC4 converted to ETBE + ethanol to 5%v/v E = As above + Incl nC4= isomerisation then to ETBE

CO2 Scenarios Comparison: Refinery Impact in Perspective with Hypothetical Overall Saving A = Ethanol 5%v/v & MTBE export, B = Ethanol 5%v/v & MTBE to iC8=, C = Existing MTBE converted to ETBE + ETOH-DB to %5v/v D = Existing MTBE + Available iC4 converted to ETBE + ethanol to 5%v/v E = As above + Incl nC4= isomerisation then to ETBE

CO2 Scenarios Comparison: Net Refinery Impact in Perspective with Hypothetical Overall Saving A = Ethanol 5%v/v & MTBE export, B = Ethanol 5%v/v & MTBE to iC8=, C = Existing MTBE converted to ETBE + ETOH-DB to %5v/v D = Existing MTBE + Available iC4 converted to ETBE + ethanol to 5%v/v E = As above + Incl nC4= isomerisation then to ETBE

Economics Drive the Choice Between Scenarios Unwise Regulations Backfiring on CO2 IMPACT REGULATIONS ECONOMICS FQDR BFDR ETS ….

CO2 Evaluation Key in the EU Bio-Fuels Agenda Conclusions CO2 Evaluation Key in the EU Bio-Fuels Agenda Impact within Refinery Significant ETS doesn’t Cover all CO2 Savings from Refinery Bio-ethers Greatly Enhance Ethanol CO2 Performance Etherification Beyond Current Capacity Good for CO2 Regulations Penalising ETBE Counterproductive for CO2