ALGETECH INDUSTRIER AS Attractive investment opportunity within biotech Microalgae are key to meet future raw materials Powered by CO 2 and sunlight March 2007

Business and investment opportunities Business opportunity Production of algae biomass is an environmentally friendly alternative to the exploitation of ”krill”Production of algae biomass is an environmentally friendly alternative to the exploitation of ”krill” Algae biomass is an unlimited and renewable resourceAlgae biomass is an unlimited and renewable resource Algae biomass can secure demand for omega 3, proteins, vitamins and anti-oxidantsAlgae biomass can secure demand for omega 3, proteins, vitamins and anti-oxidants Algetech Industrier AS possess the technology and experience for greenhouse production of algae-biomassAlgetech Industrier AS possess the technology and experience for greenhouse production of algae-biomass Investment opportunity Investing in a first plant for large-scale production and sales of micro algae in NorwayInvesting in a first plant for large-scale production and sales of micro algae in Norway

2 Algetech Industrier AS Business idea Production and sales of micro algae in Scandinavia Sales and deliveries to three separate overall market segments The Markets The Aquaculture industry The Nutraceutical industry The Agricultural industry An already existing and expanding market for algae-based products Current marked needs exceeds greatly supply capabilities – high prices

Algetech Industrier AS Algetech Industrier AS Vision To establish a sustainable industry in Scandinavia, based on cultivation of micro algae in photo bioreactor installed in greenhouses using sunlight and artificial light Goal Become a leading company in Scandinavia, producing free of toxins and environmentally friendly substances for the feed, functional- and health food industries Novelty First in Scandinavia providing access to technology that works Introduce environmentally friendly raw materials into different industrial products Will contribute to the development of new production methods Reduce the use of antibiotics and other synthetic products

Market opportunities Existing markets: Feed additives for use in agricultural and aquaculture industries, particularly production of fatty acids and proteins Micro algae are used to a significant extent in the health food products Pharmaceutical/medical products Existing algae biomass market USD 5 bill Expected significantly strong growth Future markets: Energy source – hydrogen gas and biodiesel

Algetech Produkter AS – Project Management NIVA - extensive research and competence base within micro algae characterisation and cultivation. Large collection of micro algae species available IGV GmbH – 20 years experience in algae research and industrial production. Proven technology for large scale micro algae biomass production in photo bioreactors Gavita AS – Manufacturer of lighting systems for greenhouses. Extensive experience in combined use of artificial light and sunlight Billerud AB – Large scale process industry expertise and technology Technology is based on extensive research and trial production Algetech project partners

Mixotrophic production of micro algae in photo bioreactor Minerals N, P, K, Mg, Na, S Traceelements H 2 O CO 2 Biomass Light Organic substrate

The cultivation in the PBR 4000 with artificial light, 24 h / day

The mixotrophic cultivation in the PBR 4000 with artificial light

Growth of micro algae by combining sunlight and artificial light Sunlight only Combined sunlight and artificial light

Products from Micro algae Protein-rich biomass -e.g. as ingredient in aquaculture and animal feed products Astaxanthin -red-orange, carotenoid, e.g. for use in salmon feed Nutraceuticals -e.g. dietary supplements, natural remedies, food, skin care Pharmaceutical and drug compounds -potential for use in prevention and treatment of various diseases Bio-compounds - e.g. fatty acids (DHA)

The aquaculture market –Fish feed - total consumption t/year –Fatty acid and protein ingredients in fish-farming - yearly consumption t/yr –Annual growth in consumption: 10-15%, tons –Few participants Animal feed –Large market, protein supplement for pig and poultry –Poultry - yearly consumption t/year –Lack of new resources to satisfy increasing demand –Few players Nutraceuticals – dietary supplements –World retail nutraceutical market estimated to USD 106 billion –Functional food USD 77 billion –Growth rate annually 6,2 % –Fatty acids, fastest growing market, annually 16% The Norwegian market

Customer benefits and price level In aquaculture, cod larvaeIn aquaculture, cod larvae – –Faster growth, Less mortality, Free of toxins – –Expected market price: NOK NOK 175 pr. ltr. – –Price level: Competitiveness with synthetic feed products In agriculture, poultryIn agriculture, poultry – –Faster growth, Less mortality, Free of toxins, less cholesterol – –Expected market price NOK pr. kg NutraceuticalsNutraceuticals – –Demand surpasses supply – –Expected market price: NOK NOK 450 pr. kg. – –Price generate profit high profit

Business model Core business: Innovation, production, product development, marketing and salesCore business: Innovation, production, product development, marketing and sales Production, sales and distribution in co-operation with othersProduction, sales and distribution in co-operation with others In special areas Algetech Industrier AS do it aloneIn special areas Algetech Industrier AS do it alone. Proven technology Idendification and application of new technology -Continuous new product development with partners Core area -Contract manufacturing -Sales and distribution network - Licesing,royalties, direct sales andcombinations Cooperation with Industrial players Production Value addedMarketingDistributionRetailerEnd-customer

Competitors The aquaculture market - Start feeding of cod larvae: -Import of algae biomass from U.S and Japan, Read Mariculture dominant -IDUN - Norwegian producer of yeast -Feeding of farmed fishes: -Krill producer Aker BioMarine and Igene/ProBio The agricultural market (animal feed) - Many small players, no dominant - Many small players, no dominant The nutraceutical market (dietary supplement) - Many large int. industrial players in the market - Abbott, BASF, DuPont - Many large int. industrial players in the market - Abbott, BASF, DuPont - Small Norwegian producers - Aker Biomarine, Alpharma, ProBio - Small Norwegian producers - Aker Biomarine, Alpharma, ProBio

The aquaculture market Start feeding of cod larvae: - Distribution carried out by Algetech Feeding of farmed fishes: - Distribution through EWOS and Skretting AS The agricultural market Feeding of animals: - Distribution through public and farmed controlled channels: Cermaq ASA and Felleskjøpet. In Sweden: Lantmânnen AB The nutraceutical market - Distribution through integration with a partner which has its own trademarks and a need for raw materials. - Distribution and sales to drug chains as Alpharma AS - Sales and distribution to producers of dietary supplementary products as Pharmatech AS and Nutri Pharma ASA. Distribution Channels

Based on production from the first plant, one photo bioreactor SUM Sales volume: Wet algae biomass l l l l Dried algae biomass 850 kg 5000 kg 7500 kg kg Revenue (NOK) Costs (NOK) Profit (NOK) Capital need, including start up costs: NOK 12,5 Mill. Financed through: risk loan, public support, private equity and equity offering The company has, up till now, spent NOK 5 mill in research and development. Plant 1 may be extended by a second photo bioreactor. Investment approx. NOK 9 mill. Decision to be taken after commercialisation. Budget – phase 1

Investors are invited to participate in Algetech Private placementPrivate placement Active involvement and part of the boardActive involvement and part of the board Equity offering 35% of sharesEquity offering 35% of shares Phase 1 May 2007: Search for financial/industrial partner Aug 2007: Planning first plant Jan 2008: End of construction Feb 2008: Commercial production and sales Phase 2 (2009) Public offering: NOK 100 MillionPublic offering: NOK 100 Million Investing in existing greenhouses – large scale productionInvesting in existing greenhouses – large scale production Annually revenue of appr. NOK 100 mill.Annually revenue of appr. NOK 100 mill.

2000: Proven photo bioreactor technology - mixotrophic technology, combining sunlight and artificial light 2006: Trial production completed confirms - large scale production in Scandinavia feasible and flexible production, applicable for a variety of algae species Project status

Risk factors Establish a competent organisation Market finds other and cheaper product alternatives Energy price development Exit strategy Listing the shares on the OTC-list of OSE Project or trade sell Great share value potential on project success Risk and Exit

Why invest in Algetech Industrier AS Important and experienced partnersImportant and experienced partners Environmentally friendly biotech company for the futureEnvironmentally friendly biotech company for the future Low start-up costs and fast expanding opportunitiesLow start-up costs and fast expanding opportunities End-customers are already establishedEnd-customers are already established Huge opportunities for high revenueHuge opportunities for high revenue Micro algae based products are key to meet future demands Revenue making in early stageRevenue making in early stage