Bioprocess Technology

Upgrading the Value of Shale Gas on-site with Innovative Syngas Bioreactors

ryan.johnson@curtislab.org (215) 272-0564

Calyx Bioprocess Technology• Scalable, low-capital cost bioconversion of syngas to chemicals

• Utilizing patented plastic-lined bioreactor• High-value products for enhanced revenue

• Targeting unique biochemicals • High Quality Lubricants (wax-esters)• Petrochemical substitutes• Cosmetics

• Targeting stranded gas and remote shale wells• Areas where gas infrastructure is uneconomical• Profit from current gas flaring sites

• On-site gas liquefaction process• Remotely monitored bioreactor• No gas distribution infrastructure needed

Potential increase in NG value per Billion cu. Ft.$3,000 (Transport Fuels: 167%)

$60,000 (High Value Lubricants: 1,300%)$200,000+ (Cosmetics: 4,400%)

Wax Esters

Curtis WR, Growing cells in areservoir formed of a flexible sterile plastic liner,U.S. Patent #6,709,862, March 23, 2004.

How big is the opportunity?

Remote gas reserveslacking infrastructure

• Market Characteristics• Oil/gas Shale Boom

• Volatile market and record-low natural gas prices

• Expansive shale reserves• 100-200 Tcf recoverable

• Estimated 7 billion cubic feet of natural gas flared in US (2011)

• Current wells out of production• Many wells are not bringing gas

to market due to economics

• Decentralized and Remote well sites• Topography and vast area of PA

prevents new gas distribution infrastructure

eia.gov

Experienced Team

• Management Team (Chemical, Industrial, Biotech, Energy Engineers)– Dr. Wayne R. Curtis– President and CEO

• 25+ years algae and plant biotechnology experience• PI on ARPA-E funded “Electrofuels” Project

– Ryan Johnson– Engineering Manager, Biz Development• Bioreactor Scale-up, Process Control• Involved in CALYX entrepreneurial activities since 2011. • Product Quality Characterization

– Dr. Alex Rajangam– Molecular Biotechnologist• 12+ Years experience in biomass energy, metabolic engineering of wax-ester biosynthetic pathways

– Nymul Khan– Intern• Bioreactor Design Challenges• Genetic Screening

• Technical Advisors– Dr. Harold Schobert– Renowned expert in gasification reactors and syngas conversion

Why are we doing it?• Leveraging technology developed under ARPA-E Electrofuels

program fixing biofuels from H2 and CO2• High-efficiency conversion of gas phase to high quality biofuels• High-throughput chemical screening of genetically tailored organisms

• Current syngas to liquids is based on 100 year old technology• Fischer-Tropsch liquefaction requires large-scale, high cost equipment

• Current syngas bioreactor systems produce alcohols• Difficult product separation, lower value product line• Our group has experience with fatty acid wax esters • Wax esters are currently being marketed for high-value lubricants and

cosmetics

• Rapidly developing oil-shale with un-utilized “producer gas”• Flared gas in the U.S. is exponentially increasing (increased by $315

Million in potential revenue from 2010 to 2011)

Technology Overview• A low-cost trickle-bed bioreactor is poised

to be the only leading technology capable of upgrading natural gas to liquids at such a small scale

• Genetic modifcation of Clostridium ljungdahlii with Jojoba wax ester pathway

• 97+% biological conversion of gas• 87+% Conversion to product

• 13% used for biological functions

Plastic-Lined Lab-scale Trickle Bed Fermenter 100 Liter for scale-up parameters

97%+ Syngas Yield Requires

1 ) Zero outputs except BioFuel “Dead End Fermentation”

2) Ultra-Low Dilution Rate “Growth Disassociated Fuel Production”

3) Secreted Hydrophobic Product

Who else is doing this?

100,000100

$150,000

Carbon Sciences

Qatar GTL

$10,000

Fischer Tropsch / Thermochemical

Coskata

INEOS (Bio)

Alcohol Product

LanzaTech

Syngas / MethaneFermenters

High Temp

Plastic-LinedTrickle Bed

• On-Site Conversion• High-value Product Line

• Highest Conversion Efficiency

CapEx($/BPD)

Capacity (BBL/day)10,000

Our Competitive Advantage• Centralized, large-scale processing still requires natural gas

distribution infrastructure• On-site liquefaction requires minimal gas handling

• Production of alcohol requires distillation• Our continuous process phase separates our product through decantation

• Trickle-bed fermenters have ultra efficient gas-to-liquid mass transfer with minimal operational cost

• Trickle-beds are much larger (90%) than conventional stirred tank fermenters• Our patent allows us to have maximum efficiency with minimal capital cost

OPERATIONAL COST ($/hr/m3)

1

10

100

1000

0.001 0.01 0.1 1

k La(1

/hr) External Loop Airlift

Surface Aerator (HiFlux)

Bubble Column

Stirred Tank

Trickle Bed (low power)

Trickle bed (high power)

WantThis

Minimal capital cost Maximum efficiency per Energy Input

Economic Assessment• Conventional Small Scale FT-GTL CapEx is uneconomical

• > 120,000 $/BPD• 55% of CapEx for Syngas Production• 35% of CapEx for Fischer-Tropsch• 10% of CapEx for Product Upgrading

• 100 BBL/day commercial facility analyzed using ASPEN HYSYS• 25,000 m^3 CH4 / day (@ $4.54 / 1k ft^3)• 87% conversion of syngas to fuel• $5.6 MM for “Conventional” Trickle Bed Reactor (370 m^3)

• Plastic Lined Reactor CapEx < $0.75 MM

• High-value product line enables strong ROI• Operational + Fixed + Capital = $126/bbl• High-value lubricant product lines allow for ROR of > 322%• Does not include operational / capital of syngas reforming.

Business Model and StrategyStages Timeframe Deliverable Funding Milestones

Phase I: Demonstration Scale Operation of “Showcase” Trickle-Bed Fermenter

Summer/Fall 2013

100-1000 Liters Continuous Conversion of Syngas

$300,000-600,000

(Grant Funding)

90+ % Gas Utilization0.01 $/hr/m^3Lubricant properties of productPatent applications

Phase II: Pilot Scale Operation with Strategic Partners

2015-2016Turn-key facility for lubricant and syngas utilization.

$2.5 Million (Capital

Investments)

Fully Automated97+% Gas Utilization0.001 $/hr/m^3Patents GrantedCommercial PrototypeFirst Revenues

Commercialization: Turn-key on-site facilities with strategic partners.

2016 +

Scalable product and expansive customer base.

Investment cost to be determined. Depends on non-dilutive funding.

Marketable product.

Nationally equipped.

Strategic Partner Possibilities• Unique strategic partner for syngas production from methane

• Steam reforming of Methane to syngas has been cost prohibitive at small to medium scale

• Reduction is CapEx for small scale autothermal methane reforming is necessary for economics

• The high specificity of transgenic bacteria allow our group to tailor products to our partners and customers• We have modified our current product lines (fuels) to include higher value

lubricants.• We will seek to partner with synthetic lubricant manufacturer (such as

Mobil-1)• Enable wax-ester product lines during scale-up• Further test product lines for higher value applications such as cosmetics

Shell GTL Facility High Value Lubricants Cosmetics Value Chain