1. Scale Necessary for Export
Wood Pellets
Scale Necessary for Export

2. Shane Gaither
Daychanger Consulting

3. Wood Pellet Uses Domestic International Heat BBQ Pet Products
Power Generation

4. Why Not in the US for Power
GAS

5. Small Scale Opportunity
Bagged Pellets
Heat
BBQ
Pet Products
Increased Handling
Much Higher Quality requirements

6. Large Scale Opportunity
International Green Energy Market
Demand is poised to increase dramatically in Europe when Japan and Korean shipments begin.

7. US Rail

8. Largest European User of Wood Pellets
Primary Market
Power Generation
European Countries UK
Netherlands
Germany
Italy

9. Barrier to Entry
Catch 22
Buyers want assurance that plants will actually be built
Financiers want assurance that contracts are in place

10. Scalability The Ideal plant size is 450 thousand metric tons per year
Leverage
Wood costs
Logistics
Rail
Ship Owners

11. Another Possibility Centralized Cooperative
Deliver smaller amounts to a centralized location from i.e. Sawmills
Store in dome near rail siding
Ship in unit trains to port
Load ship “hot”

12. Need for Scale
Unit Trains
Charter Parties

13. Unit Train Loading
Unit Trains are required to keep freight costs down and smooth transit time

14. Charter Parties and Ship Size
Many factors go into negotiating shipment size but bottom line is the bigger the better is best for the Bottom Line.