THE VALUE OF COPRODUCTS

The value of coproducts in the production of biofuels has long been overlooked by the industry as a whole. However, in recent debates surrounding the net energy values of ethanol, the discussion of biofuel coproducts took centre stage. With the recent drops in ethanol prices and the ensuing reduced operating margins, affecting the entire ethanol industry, the potential value and broader market possibilities of biofuel coproducts has suddenly garnered tremendous interest within the industry.

Syntec Biofuel's thermochemical conversion of biomass into fuel alcohols produces a mixture of methanol, propanol, butanol, and ethanol. This provides producers with a diversified product line that inherently hedges bets against potential market fluctuations in ethanol prices. The higher retail prices of propanol and butanol, and the consistent demand for methanol, provide producers with both economic security and stability should the demand for or price of ethanol drop.

Even more compelling in the argument for diversified product lines, is the fact that the coproducts produced by Syntec's thermochemical process already enjoy an exisiting market with ready buyers. The products can be quickly and easily transported via pre-exisiting infrastructure, distribution channels, and into well established industries. As the coproducts appeal to different industries - transportation, chemical, industrial, etc - should one product market experience troubling times it will not result in immediate declines in demand for the others. Many of these coproducts also enjoy high marketplace value and demand in overseas markets; such as in China where there are extreme shortages of propanol.

March 2009