www.praj.net

Biotechnology and Renewable Chemicals:

The Future is Now

Pramod Chaudhari

Executive Chairman

www.Praj.net October 12, 2012 Vancouver, Canada

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Critical Observations……

Over 98 % of all Compounds in nature are Carbon Based

Developments in Organic Chemistry, Catalysis & Chemical Engg

has invented newer ways for producing Chemicals

Petroleum Refining has enabled various cost competitive routes to

produce Bulk & Specialty Chemicals over last 100 yrs

Over 70,000 Chemicals are produced each year

However,

• Petroleum Raw material resources are limited

• Human Needs and Environmental issues are Colliding

• Planet Earth Challenged by Critical Risks like Climate Change

Is it time to look into future and revisit Biobased products ?

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Chemicals Industry : Key Challenges

1. Overdependence on Fossil Raw Materials - Feed Stock prices are volatile

- Inability to pass price hike to customers

- Contracting Margins

2. Shift from Naptha to Natural Gas - Cheaper C2 Chemicals

- Challenge is to run Naptha Crackers Cost

effectively for C3/C4 Chemicals

3. Upcoming Regulatory Challenges - Improvement of Carbon, Energy &

Water Footprint to meet emerging

Environmental mandates

- RFS 2 mandate (???)

4. Changing Customer Needs - Novel Products

- Green Ecofriendly Products

- No Green Premium

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Rise of Biobased Economy

Non Renewable Renewable

Witnessing Shift in Feed stocks

from Hydrocarbons to Carbohydrates

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0

100

200

300

400

500

0 100 200 300 400 500 600 700 800

0

50

100

150

200

250

Sugar

Cane

Corn Wheat Casava

0 20 40 60 80

100 120 140

0 100 200 300 400 500 0

20 40 60 80

100 120

PR

Volumes in Dry MMT / Anum

1 MT of Grain can yield 1-2 MT / Acre / Yr

BioMass for Biobased Chemicals

USA

CANADA

Brazil

Argentina

Columbia

Peru

RUSSIA

EUROPE

CHINA

INDIA

SEA

Carbohydrate Feed Stock Availability

Carbohydrate Feedstock is Abundant Globally

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Oil Price Vs Sugar Price

5

10

15

20

25

20 40 60 80 100 120 140 160 180

Su

gar

US

c/lb

Crude Oil US $/ bbl (Brent crude)

Current Raw Sugar 25 c/lb

Approx Sugar Mill Transfer Price 20c/lb

Current Oil

$ 110/ bbl

Bio Route Cheaper

Petro Route Cheaper

Illustrative : Not to Scale

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Title | Date | Confidential | Presentation details 7

Renewable Chemicals - Why Now ?

1. Rising Prices of Fossil Feedstock

2. Uncertainties of Supply

3. Cleaner Less Expensive Process

4. New Products

5. New Value Chain Players

6. Market Pull from FMCG Players

7. Environmental Awareness

Crude Oil > 100 US $/bbl

Geo Political Unrest

1,3-Propane Diol

PLA, PHA, Ketals Commercial

Enzyme, Microbes, Process

Coke, Pepsi, Toyota, P&G

High Effort to Reduce CO2

8. Government Support Country wise Mandates

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BioRefining: The Concept

8

Feedstock Processing Products

Sugar

• Cane Juice / Syrup

• Molasses

Starch

• Corn, Wheat

• Sorghum

• Cassava

Cellulosic

• C5 Sugars

• C6 Sugars

Algae

• Carbohydrates

• Oils

BioChemical • Yeast, Bacterial,Fungal • Aerobic, Anaerobic • Solid State/ Submerged • Enzymatic • Downstream Processing

Chemical • Extraction • Catalytic • Downstream Processing

Fuels

• EtOH, BuOH

• Drop-In Fuels

• Next Gen

Chemicals

• Furfural / Derivative

• Organic Acids

• Furanics

• PG, BDO, PDO,

• MEK, Isoprene

• Specialty Chem.

• Oleochemicals

• Polymers

Power / Steam

Oils

• Veg / Castor Oil

Multi feed, Multiproduct Smart Biorefineries

• Human Food

• Animal Feed

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BioFuels &

BioChemicals

from

Starch, Molasses

Large Integrated

Plants for Advanced

BioFuels & BioChemicals

from LC

High Performance

Synthetic BioFuels &

Functional Chemicals

1st Gen BioFuels

& BioChemicals

Integrated BioRefining

Technologies

Customized Advanced Biofuels

& BioChemicals

SUGARS Molasses, Starch Biomass

Fermentation

Down Stream (Recovery & Purification)

Natural

Micro-Organisms

GM

Micro-Organisms

Power Specialty

Chemicals

Ethanol &

Advanced BioFuels

Bulk

Chemicals

H & W

products

Green

Chemistry

Bio-Refinery Models Evolution

9

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Future is Happening Now ….. !

Process

Development

Process

Optimization (Pilot)

Scale Up

(Demo) Commercial

Stage

C3

C4

C5

C6

Lactic acid

1-3 PDO

3HPA ( Acrylic Acid)

Succinic acid 1-4 Butanediol

Iso-Butanol 2,3 BDO

Isoprene

Adipic Acid Caprolactum

Itaconic Acid (ELA) PolyKetals

Glucaric Acid Isosorbide

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Bio Refineries – Key

Considerations

• Feedstock

• Price Volatility

• Seasonality

• Availability

• Process

• Rate, Titer, Yield, Selectivity, Recovery

• Capex, Opex

• Scalability, Complexity, Flexibility

• Product

• Performance

• Price Volatility

• Oil Price

• Applications: Drop-In versus Replacement

• “Green”

• Energy, CO2, Land, Water

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Who will Win …….?

CATALYSIS • Proven for Bulk Chem

• Lower uncertainties

• Higher yields

• Scalable Operations

• Existing Assets

Challenges

Novel Catalysts

Byproducts formation

Minimum Economic Size

BIOTECHNOLOGY

• Higher Specificity

• Novel Products

• Lower effluent issues

• Lower Min Economic Size

Challenges

Novel Microbes

RM & Product Toxicity

Scalability Challenges

New Investments

Integration of Multi Technology Platforms Possible

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Regional Story : INDIA

• 45,000 different plant species

• 16 different agro climatic zones

• 10 vegetative zones

• 426 habitats of specific species

• 30 million micro-organisms

• 23,000 fungi, 2,500 algae

Rich Biodiversity

Pool of Qualified Human resource

US $ 4 Bn Biotech Industry

Access to Agricultural Biomass

Approx 125 Mn ha Agricultural Land

130-200 Mn tpy Surplus Biomass

(Rice, Wheat Straws,Cotton Stalks,

Oilseed residues, Pulse residues,

Sugarcane tops / trash, Pulp/Paper

Wood, Forest Wood

Large Consumer Markets

INDIA Strategic Advantage

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Lucknow

Vadodhara

Chandigad

•Gennova (Emcure) •Serum Institute •Sci-gen •Advinus •Tata Chemicals •Battelle India •Acoris (HIKAL) •Venkateshwara Group •Praj Industries Ltd. •Hijewadi Biotech Park

• National Chemical Laboratory •National Center for Cell Sciences •National Institute of Virology •Institute of Bioinformatics and Biotechnology •Pune University

Indian BioTech Clusters

INDIA Strategic Advantage

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Shifting Trends in MNC R&D Strategy in India

Capturing Opportunities in Emerging Markets Need Innovations Directed to local needs

International Collaborations are key to Rapid Commercialization,Globally.

Indian Companies are launching Global Strategies based on these innovation.

Reverse Innovation

Glocal Local Reverse Global

• Make Products for Global Developed Markets • Innovate at Home • Distribute Globally

• Make products for Global Markets, • Localize to emerging markets • Innovate at home • Develop at Emerging Markets

• Make products for local markets • Innovate at Home and Emerging Markets, • Develop near Local Markets

• Make products for local market needs • Adapt to world wide needs • Innovate & Develop near Local Markets

INDIA Strategic Advantage

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From India For the World

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Thank you !

PramodChaudhari@praj.net

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