2005 OBP Bi-Annual Peer Review Georgia-Pacific Steam Reformer Big Island, Virginia Larry Rath Integrated Biorefinery November 16, 2005

Overview Project start 2/15/01 Project end 4/14/06 ** Percent complete 85% Commercial-scale demonstration Generation of synthesis gas for future R&D Total project funding $142.4MM DOE share $44.4MM** Contractor share $98.0MM** Funding FY04 $3.42MM Funding FY05 $0 FY06 Request $26.6 for 50/50 cost share** Timeline Budget Barriers University of Utah Brigham Young University Oak Ridge National Lab University of Missouri – Rolla NETL Partners Commercial-Scale Demonstration

Project Goals and Objectives Demonstrate MTCI Steam Reforming technology in commercial-scale. Identify technology barriers and resolve Identify capital costs to install Demonstrate energy benefits Demonstrate environmental benefits Demonstrate operating and maintenance costs Demonstrate long term operational reliability Demonstrate the integration of the technology with the chemical recovery and energy generation systems of the mill

Project Strategic Fit This project is essential to development of an integrated biorefinery in the pulp and paper industry because it demonstrates the ability to generate synthesis gas on a commercial scale. Objectives and Barriers This project will demonstrate black liquor gasification can be integrated into an operating pulp and paper mill Biomass gasification is the first step toward implementation of a biorefinery in the pulp and paper industry Black liquor gasification has the potential to transform the pulp and paper industry from an energy consumer to an energy generator while reducing the environmental emissions. This project is a Commercial-scale demonstration of steam reforming of black liquor

Project Approach Approach to Eliminating Barriers Tar Formation – top technical barrier Conduct operational trials to quantify amount generated under various operating conditions Perform analytical testing to determine quantity and species generated Modify gas clean-up train to isolate various tars and to improve operability Conduct basic R&D at University of Utah PDU Modify liquor injection system to determine impact on tar generation Install instrumentation to gather additional data Work with IPST on hot gas sampling and R&D on conditions for tar generation. Pilot conclusions from IPST work at University of Utah Coordinate research with Norampac and TRI

Project Approach cont. Approach to Eliminating Barriers (continued) Carbon Conversion – impacts energy & chemical efficiency Conduct operational trials to measure changes under various operating conditions Conduct basic R&D and pilot trials at University of Utah PDU Modify liquor injection system to determine impact on conversion Install instrumentation to gather additional data Coordinate research with Norampac and TRI

Project Approach cont. Approach to Eliminating Barriers (continued) Fluidization – currently the system in place is adequate Conducted cold flow modeling at 1/3 scale Conducted full scale trials a 7 different fluidization grids Developed and installed instrumentation to monitor pulse heater temperatures as a measure of fluidization Current grids have operated for extended runs without any plugging Bed Particle Size – currently being controlled by variations of liquor injection, atomizing steam and fluidization velocity

Project Approach cont. Approach to Eliminating Barriers ( continued ) Aerovalve Design – original design failed Installed thermocouples to measure tip temperature Complete redesign of the aerovalve assembly including metallurgy and mechanical design New design to be tested December, 2005 Pulse Heater Combustion Chamber Refractory Original design failed Several repairs were implemented Task group including ORNL, University Missouri-Rolla, Hogue Refractory, Norampac, and TRI New design of AZ-10 refractory and Inconel 601 anchors was not successful Failure analysis and new design is in progress

Project Approach cont. Approach to Eliminating Barriers ( continued ) Green Liquor Filtration Green liquor filter performs as designed and provides an excellent green liquor quality Due to the extremely poor carbon conversion filter is not capable of processing full plant load Pilot trials were performed for filters capable of processing the additional carbon in the liquor Change in design to a unit with a dry filter cake is required due to the large volume of carbon Will investigate alternatives for waste carbon Burn as fuel in other boilers Sell activated carbon for higher value purpose

Project Tasks The major task for this project is to demonstrate the technology Chemical Recovery – target = 400,000 #/day black liquor solids – have reached 80% for short periods & consistently run at 50% for extended periods Energy Performance – target = net export of 70 MMBTU/hr – currently net energy consumer due to carbon conversion and tar formation Environmental Performance – target = emission levels set by VADEQ – currently well below emission levels allowed Cost - target = less cost than recovery boiler – life cycle cost evaluation requires elimination of current barriers

Project Collaboration University of Utah – operates pilot (PDU) unit of GP reformer – provides analytical testing of tars– GP provides liquor, bed solids, tar samples, technical assistance on PDU design and operation Brigham Young University – provided bed agglomeration R&D Oak Ridge National Lab – provides metallurgical R&D for pulse heater tubes, corrosion monitoring, refractory testing and design University of Missouri-Rolla – provides refractory testing and design NETL – provided resources to develop CFD model of the reformer fluid bed Active collaborators participate in periodic Technology Roundtable Meetings hosted by the operating mills. R&D progress & needs are reviewed at the Roundtable meetings and through conference calls.

Steam Reforming technology is attractive to all Pulp and Paper mills. GP project will demonstrate this for non- Sulfur mills. With elimination of barriers, mills will adopt as existing recovery boilers are retired. Life cycle cost of the technology must not be higher than implementation of recovery boiler technology in a mill. As energy performance is improved, higher capital cost can be absorbed. As long as pulp mills have a recovery cycle, this technology is viable. This technology is also suited for other pulping approaches which are a future path for the industry. Market & Customers

GP must complete demonstration of this project by March 2007 to meet environmental requirements. Competing technology is a Tomlinson Recovery Boiler. Steam Reforming has the potential for higher energy conversion and significantly lower environmental emissions. The synthesis gas can also be used to produce bioproducts for use in other applications. The basic purpose of the technology is to make the industry more energy efficient. If markets for the biofuels / bioproducts change, the technology is still viable from an energy efficiency standpoint. The technology is currently less economic than the competing technology. Once several of the barriers are overcome, future plants will be economical. Competitive Advantage

Progress and Accomplishments Accomplishments (FY04 and FY05). Processed liquor at 80% of the design rate. Consistently able to run at or above 50% of the design rate. All bed solids generated are converted to excellent pulping liquor and are used by the operating mill. All synthesis gas generated is burned in the boiler to generate steam used by the operating mill. Environmental emissions are significantly below permit levels. Resolved the fluidization barrier.

Future Work Plan for FY06 Partial Resolution of Critical Barriers – all of the barriers identified must be resolved to the extent that the technology can support 100% of the mill operation. Work to Resolve Less Critical Barriers – improve the energy performance of the technology and optimize system performance. Make the Technology Decision – Per environmental permit, by March 2007 GP must formally accept this technology or begin implementation of alternate technology for chemical recovery in the mill.