GS AgriFuels To Convert Corn Oil Into Biodiesel At Ethanol Facilities

New York, NY - GS AgriFuels Corporation recently announced its plans to co-locate integrated corn oil-to-biodiesel production technologies on-site at ethanol production facilities.

GS AgriFuels' biodiesel production technologies, developed by recently acquired NextGen Fuel, Inc., are modular and can be integrated directly into existing and new ethanol production facilities in a plug-and-play manner. The technologies allow host ethanol facilities to quickly and cost-effectively participate in the benefits of corn oil biodiesel production.

Benefits of the program:

• Integral, modular and plug and play technologies
• Low capital and operating expense versus traditional methods
• Rapid commissioning – less than 9 months from contract
• Host facilities can own equity in co-located production assets and have rights to purchase or re-sell biofuel output
• Participating ethanol facilities generate significant additional annualized income and earn a return on their investment in the program about 1.5 years

The program works as follows:

• GS AgriFuels' sister company, GS CleanTech Corporation, a process engineering and technology transfer company, sells technology and equipment to ethanol facilities designed to extract corn oil from distillers dried grains ("DDG"), a co-product of corn ethanol production that is currently sold as a feed product.
• GS CleanTech sells its Corn Oil Extraction Systems™ to participating facilities and maintains the right to purchase the extracted corn oil at a substantial premium to its current value locked in the DDG. The ethanol facility receives 100% of the economics from the corn oil purchases.
• The jointly-owned biodiesel facility will acquire this oil and convert it to biodiesel on site. The host ethanol facility not only receives a stake in the biodiesel facility and its pro rata share of profits, but also the right to acquire or market all of the biodiesel output.

Impact of corn oil extraction & integral biodiesel production on 100MM gallon per year ethanol facility:

• An ethanol facility converts 36 million bushels of corn into 100 million gallons of ethanol and 320,000 tons of DDG. DDG has a value of only $0.035 per pound while fuel prices exceed $0.30 per pound and therefore it is highly advantageous to convert as much as possible of this DDG byproduct into fuel.
• GS CleanTech's patent-pending corn oil extraction technology extracts roughly 7 million gallons of the fat in the DDG in the form of corn oil that can then be converted into biodiesel on close to a 1:1 volumetric basis.
• GS AgriFuels' patent-pending NextGen biodiesel process technology leverages innovative process intensification techniques to accelerate and enhance traditional biodiesel reaction
• kinetics, thus decreasing process time, reducing energy and raw material needs, and increasing product quality. These benefits translate to increased capital and operating cost efficiencies at smaller scales as compared to traditional biodiesel process technologies, and much quicker lead times.
• Used in concert, both technologies increase the corn to fuel yield by roughly 7% and corresponding revenues by more than 6%.

Tom Scozzafava, president and chief operating officer of GS AgriFuels, added that "The opportunity to create and offer this program to ethanol producers was a key motivation for our recent acquisition of NextGen Fuel. NextGen's biodiesel technology completes the technology product suite of corn oil-to-biodiesel and allows us to offer the program in the most rapid and cost effective manner. The NextGen biodiesel process technology is a very robust, continuous flow process that is less capital intensive to build and cheaper to operate as compared to traditional batch methods. It is cost-effective at small scales and its plug and play capability equates to rapid deployment cycles. For example, a host ethanol facility that signs up for our program today can be in operation before the end of 2007. We are very excited to offer this exciting program to ethanol producers and their communities."

SOURCE: GS AgriFuels Corporation