1. 2005 OBP Bi-Annual Peer Review Fran Ferraro Merrick & Company Sealaska Corporation Southeast Alaska Ethanol Project Integrated Biorefinery Session November 16, 2005

2. Overview Time Line Proj. Start: 6/03 Proj. End: 12/06 55% Complete Stage Stage 3 Development Pilot Testing Barriers Contaminated Feed Mat’l Scale-up Integration Yield/Costs Budget Total Proj. Start: $5,350,021 Project End: $5,350,021 58% Complete Partners Sealaska Corporation Merrick & Company USDOE USDA

3. Project Goals and Objectives Select and demonstrate suitable technologies to convert SE Alaska wood residues to Ethanol for the Alaska market. Previous – established project concepts and economics.  Select gasification (steam reforming) technology  Select ethanol conversion technology  Confirm suitable gas cleanup technologies  Pilot test technologies on contaminated wood residue  Design commercial scale facility  Construct and operate wood residue conversion to ethanol

4. Project Strategic Fit Relevance to Platform and Pathway Objectives and Barriers Thermochemical Platform – Feed and Thermochemical Processing, Gas Clean-up Products – Fuels, Chemicals, CHP Integrated Biorefineries – Ag Residues, Energy Crops, Pulp & Paper, and Forest Products Mill Improvement Pathways

5. Technology Fit and Demo Vision Technology Fit for Sealaska/Merrick Regional timber and lumber processing Residues environmental control Alaska ethanol market Multiple Biomass-to-Ethanol projects Demo Phase Vision by 2008 Design Basis and Costs – early 2006 Financing and Design – 2006 to 2007 Construction – 2007 to 2008 Ready

6. Project Approach & Design Technical Barriers Feed -Preparation -Contaminants Gasification (Steam Reforming) -Gas Composition – yield -Gas Cleanliness Conversion -Yield vs. Costs -Fermentation – limitations? -Catalytic Process Efficiency -Waste Energy Utilization -Tail Gas Process Integration Project Design Practical Syngas Quality and Quantity Practical Conversion – Integrated Practical Energy Utilization – Integrated Later – Improve all 3

7. Technical Feasibility Feed  Preparation  Contaminants Gasification (Steam Reforming)  Syngas Composition  Syngas Cleanliness Conversion  Alcohol Yield(s)  Heat Utilization  Tail Gas

8. Project Tasks Select Technologies Basis – yield 70 gal per Dry Ton Compatible with feed and product Risks – readiness, suitability for feed, yield, cost Pilot Demos – Integrated Process Commercial Scale Design Basis and Cost Estimate Design, Build, Run Demo – 2006 – 2008 Adjust designs for other project feedstocks, locations, etc Commercial Operating Plants

9. Competitive Advantages Suitable for numerous feedstocks with proper preparation Superior yield vs. costs Integrated heat/energy and potential export Potential Show-Stoppers: Scale-up  Demo 200 – 250 DTPD Integration with reasonable costs  Initial Projected Economics  Future Projected Economics

10. Commercial Scale Design Basis Commercial Scale Design Basis and Cost Estimate Basis – 6 mm gal/year AK facility on salt water contaminated wood residue Risks: cost, business Milestones – cost $30 - $40 mm, business/technology useful elsewhere Go/No-Go – Economic Return on net Equity Investment Accomplishments – underway Future Plans – more feedstocks and locations, heat and power integrated

11. Project Collaboration Sealaska Corporation with Merrick & Company USDA, USDOE, NREL Technologies – Enerkem Technologies, Inc.; ThermoChem, Inc.; Bioengineering Resources, Inc.; BioConversion Technology, LLC Industry – other similar projects – RDF, Pet Coke, Ag Residues Alaska – AIDEA, AEA, Ketchikan Gateway Borough

12. Market & Customers Ethanol Product – fuel blending Heat and Power – users Costs Ethanol @ $0.90/gal. depends on scale and other aspects Current/Future Market Shifts

13. Competitive Advantage Window – next few years Competing Technology – gasification and fermentation or other catalytic conversions Ready for commercial demo, yield Market Change – fuel and octane blending value; min. costs from other producers Economic/Investments – multiple interested project developers with suitable economics

14. Project Stage Stage 3 – Development Pilot Testing and Commercial Scale Design Basis

15. Progress and Accomplishments Pilot Testing – Integrated  Platform – Integrated Thermochemical Platform Conversion to Ethanol  Project – Technologies and business compatible

16. Future Work Final Integrated Pilot runs on AK feed material Commercial Plant Design Basis and Cost Estimate Design, Build Demo Milestones: Pilot Runs – 12/05 Design Basis – 2/06 Cost Estimate – 3/06 Design Underway - 2006

17. Contact Information Francis (Fran) Ferraro Senior Technical Specialist Merrick & Company 2450 S. Peoria Street Aurora, CO 80014-5472 Phone: (303) 751-0741 Fax: (303) 368-1299 Email: fran.ferraro@merrick.com