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July 2012
Commercial Infrastructure
for Production of Algae-
Based Compounds
SAT is the only commercial-scale developer of infrastructure for production of algae-based compounds
2
• SAT’s proven, proprietary and innovative technology has reached the
commercial stage and is easily scaled to meet customer needs
• Algae and algae oil production yields are the highest of any currently available,
commercial process and have consistently low production costs, offering
significant advantages over products based on food crops
• Strong patent positions protect technology as key partnerships advance R&D
and commercial footprint
• Robust and low-risk business model is supported by recurring revenue streams –
commercial project now under way in Brazil
• Company is led by an experienced management team with a proven track record
• SAT is well-positioned to execute its growth strategy in significant and diverse
markets such as livestock feed, bioethanol and biodiesel
SAT has developed a proprietary, industrial scale and fully integrated microalgae production process…
3
• Algae growth is based on photosynthesis of
CO2, producing carbon – the backbone of
algae biomass – and oxygen
• Algae biomass contains, on average: 50%
of lipids (algae oil, fatty acids, enzymes)
and 50% algae meal
• Algae lipids can be used for a variety of
products, mainly biofuels and biochemicals
• After extracting the oil from the algae
biomass, a simple transesterification
process can yield biodiesel or bio-kerosene
• The remaining algae meal can be used to
supplement or replace other food crops in
livestock feed with no adverse effects.1
Generation Algae
Bioreactor
Biodiesel Ethanol/
Methanol
Protein
Residue
Livestock
Feed Transportation Fuels
Dewatering
Algae
Biomass
Blower O2 + N
Water
Recycling
Process Flow
Source:1) K. Lum and X.G. Lei, Potential of Defatted Algal Meal Derived from Biofuel Production as a New Generation of Feed Protein, Cornell University, 2011 Cornell
Nutrition Conference for Feed Manufacturers.
• Growth rate proven in scale up
• Tested substrates urea and urine
• Optimal result achieved with 0.6mM urea
• 37% higher growth rate than control group*
…and a proprietary advanced mixotrophic production process
4
• Algae are capable of mixotrophic growth, using carbon directly, rather than through
photosynthesis
• Through this process, SAT can optimize the algae properties for specific end-markets, such
as biodiesel, bioethanol, or algae meal for livestock feed
• The mixotrophic process can boost algae growth by over 30% beyond the limits imposed
by standard photosynthesis
• This additional 30% is reached even before any enzymatic or genetic algae optimization
Source: Company Data
5
SAT has reached the commercial-scale project stage
Source: Algae 2020 study, Emerging Markets Online Consulting Services
Commercial-Market
Scale Projects
Demonstration
Scale Projects
Pilot-Scale
Project Lab-Scale
Research
Evolution of Algal Biomass Producers and Projects
SAT business stage
Timeline Evolution and Maturation of Algae Producers and Projects from Concept to Commercial Market Scale
Turnkey, bolt-on and modular production platforms are automated and easily scaled to meet customer needs
6
• SAT provides its customers with fully operational algae cultivation systems optimized for
customers’ existing infrastructure
• Algae production platforms are specialized to take into account the customer’s available
space, CO2 output, feedstock/output needs, and capital resources
• Existing commercial-scale photobioreactors can be deployed in easily scalable, one
hectare module increments
Easily Scalable in 1 Hectare Units
Technology uses pre-existing CO2 streams to make algae production independent of inputs
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• The production process is not dependent
upon a client’s access to low-cost sugar
supply or arable land
• SAT utilizes a customer’s CO2 waste
stream to drive the microalgae’s
photosynthetic process
• This leads to highly predictable costs for
SAT’s customers. Operational costs of the
algae farm are mainly personnel costs,
costs for fertilizer and for salt (to artificially
create saltwater in the bioreactors)
• Freshwater consumption is minimal, as
98% of water is reused and recycled. SAT
has also put strong emphasis on minimizing
the algae farms’ electricity consumption
SAT’s current oil yields from algae greatly exceed those of other production processes
8
• Algae is the world’s most efficient
plant, showing growth rates far in
excess of traditional field crops such
as soybeans or corn, and does not
compete for arable land
• SAT has so far used standard algae
(Nannochloropsis or Chlorella
regularis) without any modifications to
produce biodiesel
• Algae can also be economically
converted into solid fuels, methane
gas, bio-ethanol or electricity
Algae Production Cycle
Consistently low production costs enable broad market access
9
• Algae oil produced using SAT’s technology will cost approximately € 0.3/ liter,
compared to a market price of € 0.9/ liter for soybean oil1
• SAT total production cost for algae meal is approx. € 165/ tonne, compared to a
record-high market price of approximately € 369/ tonne for soybean meal2
• SAT total production cost for bioethanol is less than € 0.4/ liter based on a 10
hectare plant, compared to approximately € 0.5/ liter for an average Brazilian
domestic ethanol producer3
• SAT technology currently produces 160,381 gallons per year per acre or 1.67
million liters per year per hectare of biodiesel
• Due to marketable algae byproducts, a 10 hectare algae meal platform generally
yields a negative cost for the animal feed
• SAT technology is easily adaptable to any climate conditions
• SAT’s algae systems can be installed on any flat land and does not compete with
food crops for arable farm land
1. Cost of conversion to biodiesel is approximately € 0.1/ liter for both oil types
2. Prevailing international price as of June 2012
3. Source: Brazilian Ministry of Mines and Energy
SAT’s algae-based product offers multiple advantages over those based on food crops
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• Based on current prevailing yields, there is not enough arable land on the earth's
surface to grow sufficient corn or rapeseed to meet current demand for fossil fuel
oil
• Algae is an extremely fast-growing, biodegradable crop with high oil yields
• Furthermore, SAT’s algae production plants do not compete with food crops for
arable land and require minimal infrastructure
• The main feed for the algae is CO2,which would otherwise be unusable waste
• After initial deployment, 98% of water is recycled
SAT Algae
160,381 15x higher
Exclusive use of AlgaeVenture System’s harvester
• Exclusive rights to the specialized bioreactor membrane;
the reactor bottoms are patent pending SAT exclusive
Strong patent protection
11
• CO2 separation system is licensed
from Linde/ BASF
• PBR design is patent pending SAT
exclusive
• Lighting system base is exclusively
licensed from Bavarian Optics; the
version used at the plants is patent
pending jointly SAT/ BO
• Harvester base is licensed algae-
exclusive from Algae Venture
Systems; final industrial version is
patent pending SAT/ FMT
Key partnerships advance technology and commercial footprint
12
R&D Partners Strategic Partners
Energie AG Austria Linde AG, Austria Bavarian Optics GmbH,
Germany
Algae Venture Systems, USA FMT Montagetechnik GmbH,
Austria
Pervatech BV, The Netherlands
Kemira Oy, Finland
DEDINI Industrias de Base S/A
FH Wels, University for Applied Sciences (Biology &
Process Engineering)
University of Linz, Institute of Process Engineering
University of Duisburg-Essen, Department of Physics
CTBE - Brazilian Bioethanol Science and Technology
Laboratory
Development of a US-based, industry-driven R&D and algae strain production facility is in preliminary stages
Why a separate facility for R&D and algae strain production?
• Algae R&D has historically been directed by academia, rather than the needs of
industry
• This is especially true for genetically modified algae
• Production of algae strains on an industrial scale is almost non-existent in the
current market
• SAT’s research facility will support the company’s unique proprietary knowledge
base in addition to providing a separate source of income
• Algae strains can be either sold or licensed to other market participants who lack
such capabilities
13
US Northeast is best suited for SAT’s first algae industry R&D/ production facility
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Why the Northeast?
• The regulatory and consumer climates in
relation to GM products are more favorable
than those in Europe
• The region offers widespread access to a
highly skilled workforce
• Strong IP protections and scientific support
infrastructure in the area make it a focal
point for current algae-related research
• Low level of bureaucracy and a
concentration of venture capital make the
region preferable to Europe and other parts
of the US
Initial geographic focus will be Brazil
15
• Strong overall economic growth profile
• Significant end use markets in animal feed
and energy
• Widespread social acceptance of
alternative feedstock and biofuels
• Second largest consumer of ethanol
• Brazilian cattle inventories estimated to
reach 204 million head by the end of 20121
• 3 of the top 7 meat companies in the world
are Brazilian
• Growing pipeline of new business
supported by marketing JV with Grupo JB
Sources: 1) USDA Global Agricultural Information Network ; 2)Rabobank estimate based on public sources; 3)MAPA, EIA/DOE
Global Ranking: Meat Companies 2010 (1,000 tonnes)2
Brazilian Ethanol Consumption (in millions of cubic meters)3
One commercial infrastructure project is currently being developed, while others are under review
• Dual Use 1 hectare algae farm in Recife,
Brazil. The plant can be used both with
natural algae strains (biodiesel, fatty
acids, algae meal) and with genetically
engineered algae for bioethanol
production. The client is in negotiations to
increase the facility to 10 hectares once
the first module is operating
Grupo JB – Dual Use 1 Hectare Farm
16
Prospect #1
Brazilian Biodiesel
Prospect #2
South African Biodiesel / Biokerosene
• With soybean prices at an all-time high,
multiple major Brazilian soy producers
have expressed a desire to explore the
significantly lower opportunity costs of
algal biodiesel production
• A South Africa-based client wants to use
CO2 stream from an existing power
station to power algal biodiesel and
biokerosene production
SAT is led by an experienced management team with a proven track record
17
Dr. Joachim Grill – CEO
Dr. Joachim Grill is the former CEO of AMI Agrolinz Melamine International GmbH, a subsidiary of OMV AG, Austria and IPIC,
an Abu Dhabi state fund
Ing. Karl Stagl – CTO
Karl Stagl is an entrepreneur who has co-founded several Cleantech start-ups, and was a co-founder of Jajah, the renowned
and successful Internet telecoms start-up. Previously, he was one of the longest-serving members of Ericsson's Austrian and
CEE region management teams
Dr. Christopher Missling – CFO
Dr. Christopher Missling is a partner of New York based investment bank Brimberg & Co. and has over 15 years of finance
experience. He has been an investment banker at Deutsche Bank, serving companies across various industries. He has
executed several large volume transactions (Celanese, Hoechst Roussel Vet, Vianova Resins)
Dr. Anneliese Niederl-Schmidinger – VP Science & Technology
Dr. Anneliese Niederl-Schmidinger has ten years of experience in Cleantech projects connected to Graz Technical University
(TU). She has worked on numerous research projects in the UK and Hungary, and possesses comprehensive project
management knowledge. She holds both a degree and a doctorate in chemical engineering
Ing. Rafael Valdetaro Bianchini - Managing Director SAT Brazil
Former member of the Climate Change Group in Petrobras’ R&D Center (CENPES), former researcher in the area of CO2 in
CEPAC (PUC-RS/Petrobras) and CSO Climate-Consulting
Prof. Hans-Jürgen Franke – Managing Director SAT Brazil
Former consultant for GTZ (Germany), worked in both Portugal and Brazil developing urban and regional planning, as well as
environmental and bioenergy projects. He recently founded NETLEB (Clean Technologies, Energy and Biotechnology Network)
in cooperation with worldwide institutes and universities
SAT is well-positioned to execute a growth strategy in significant and diverse markets
18
Initial focus on leveraging demand in Brazil
Brazil dominates the 3 major markets
• Brazil is among the world’s leaders in the
production, consumption, and export of beef
• In 2011, the country produced 21.1 billion liters
of ethanol, equal to 24.9% of total world ethanol
fuel use3
- The most advanced commercial market for
biofuels4
Sources: 1) International Feed Industry Federation Annual Report 2011; 2) OECD and FAO estimates; 3) Renewable Fuels Association; 4) Biofuels Digest
Diverse International Addressable Markets
Livestock and Fish Feed
• With protein content twice that of corn and on par
with soy-based feed, but without requiring arable
land, algae feed offers significant advantages
Biofuels
• Bioethanol and biodiesel fuel represent major
global markets with vast, growing, and mandated
demand (See appendix)
Livestock and Fish Feed1
$300 billion
Biodiesel2
$34.5 billion
Bioethanol2
$60 billion
Global Market
Livestock feed represents a multi-trillion pound market in Brazil alone
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• Feed represents the largest single cost in raising
cattle, at around 60%1
• SAT algae yields approximately 1,000X more
protein meal than soybeans on a per hectare
basis (1,350 ton/ha vs. 1.4 ton/ha)
• Additionally, algae-fed cows produce higher
quality beef, as their digestive systems can
process algae more easily than soy2
• Algae has been shown to offer the same
nutritional benefits as higher cost feedstock
components such as alfalfa3
• Cattle fed an omega-3 rich diet – which algae
meal provides – have been shown to pass health
benefits on to consumers4
• Protein content of algae meal comparable to or
higher than those of common livestock feed
components (see chart)
Protein Content of Common Livestock Feed Components6
Estimated Brazilian Livestock Feed Requirements (Billions of pounds)5
Sources: 1) Ontario Ministry of Agriculture, Food, and Rural Affairs;
2)TheBeefSite.com; 3)GrainNet; 4) Kansas State University; 5) Calculation of
average feed requirements times livestock inventories, based upon University of
Nebraska – Lincoln and ThePigSite.com, 6) Company data
Cattle
Swine
0
500
1000
1500
0
1
2
3
4
5
6
7
2009 2010 2011 2012 2013 2014 2015
Advanced biofuels represent a growing, global market, with Brazil as a leading producer
• Algal bioethanol production allows sugarcane producers to sell their sugar to international
markets – using the CO2 by-products instead of the valuable sugar itself to fuel ethanol
production in SAT’s bioreactors
- SAT’s technology also allows the sugarcane producer to smooth out the industry’s
inherent seasonality by selling electricity and diverting the CO2 from their onsite
cogeneration plant to feed the production of low-cost algal bioethanol during lulls in the
sugarcane season
20
Market-wide advanced biofuels planned production capacity (millions of gallons per year)1
Biodiesel
Bioethanol
Source:1) Biofuels Digest, Advanced Biofuels Project Database
0
500
1000
1500
2000
2500
3000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2007
2008
2009
2010
2011
2012
Advanced biofuels represent a growing, global market, with Brazil as a leading producer
21
Source:1) Brazilian National Agency of Petroleum, Natural Gas and Biofuels
Total Brazilian Biodiesel Production (thousands of cubic meters)1
• The major production variable in the biodiesel market is the cost of soybeans – where
supply issues have led to price cartels being formed by the dominant producers. SAT’s
algae farms can provide algae oil at a 50% discount to soybean oil
- Additionally, the highly predictable cost of producing algae in an SAT facility significantly
reduces the high cost volatility of reliance upon a food crop
- With soy prices currently hovering around all-time highs, this benefit is more salient than
ever
Contact
Dr. Joachim Grill, CEO
SEE ALGAE Technology GmbH
Main Office: Parkring 12, A-1010 Vienna, Austria
+43 1 985 9802 0
Dr. Christopher Missling, CFO
SEE ALGAE Technology Inc.
+1 212 332 4440
Ing. Rafael Bianchini
SEE ALGAE Technology Brazil Ltda.
+55 21 6947 5993
www.seealgae.com
