BIOVALE ENERGIA:

YOUR PARTNER IN BRAZIL

AND RET PROSPECTS

www.biovale.teiaslive.net
 cluster of skills

The strategy of BioVale is to

cluster the various stakeholders of
the biodiesel sector, organizing
STRATEGY
and aligning them in
entrepreneurial design. INNOVATION PRODUCTIVITY

The great opportunity is to cluster

the best capabilities and
resources to the benefit of the PERFORMANCE BIODIESEL
ECONOMIC
COMPOSITION
partners and shareholders of spin- CLUSTER
off companies.

BUSINESS
Therefore, the innovation and CLIMATE
SPECIALIZATION

intellectual capital is BioVale´s

main asset, holding skills in Brazil COLABORATION

and abroad to make out turn-key

biodiesel projects.
 linking the stakeholders

The main objective of the Hub is to bring capabilities of the various

stakeholders involved in the bio-diesel production chain, both in Brazil and
abroad providing resources and diffusing knowledge to the linked firms.

The benefits provided through such linkages are of great significance because
of the complimentary capabilities among the stakeholders.

Linkages with foreign organizations can be a great driver of dynamism and

competitiveness to develop effectively and rapidly the Brazilian bio-diesel
program. The foreign firms benefit from linkages are reduced costs, local
market and product intelligence and enhanced assets (UNCTAD 2001).

MINASINVEST´s interventions, as a leading IPA (Investment promotion agency)

are important to the extent that investors believe that an enterprising IPA can
assist them in identifying and introducing reliable local firms and
organizations with whom the investors can partner.

The linkage envisages upgrading domestic enterprises; facilitating the

transfer of technology, knowledge and skills; improving business and
management practices; and facilitating access to finance and markets.
 Biodiesel - a Mutual Profitable Partnership

As oil prices and environmental concerns have risen in the past few
years, investment in new biofuel facilities has mushroomed in Brazil.

The Brazilian National Program for use and production was

incorporated in the Brazilian energy matrix by Law nr 11.097/2005 .

Large trans-national corporations, as ADM, have already started

investing in biodiesel projects in Brazil

The crop area required to produce the blend of initial mandatory

2% of biodiesel will be 1.5 million hectares, equivalent to only 1% of
the total acreage under crops or available for agriculture throughout
Brazil (150 million hectares).

BIOVALE ENERGY: YOUR PARTNER IN BRAZIL – FROM INCEPTION TO CONCEPTION

 Possible partners

Countries : Companies :

Bearing high agricultural

Having to meet social and
production costs
environment responsibilities

Bearing internal/external

Bearing environment liabilities
obligations of emission reduction
(Kyoto Protocol and other

Willing to attract SRI
compromises)
and valuing their stock prices

Bearing scarcity of cultivation

Bearing intensive need of fuel
lands
sources

Willing strategic alternatives

Investors in prospective high
for vegetable oil and diesel supply
return SRI

BIOFUELS: FUTURE´S MOST PROSPECTIVE INVESTMENT

 cooperation/partnership

Possible areas of interest:

Utilization of Partners technology for biodiesel plants in

building, logistics, utilization of glycerin and other by-
products, specification, engine tests, etc.

Sale of carbon credits (MDL) obtained through the

utilization of biodiesel in Brazil.

Export of vegetal oil and biodiesel to Partner´s country.

Exploitation of the potential domestic market

 BioVale contributions

GENERAL CORPORATE ACTIVITIES

General coordination among the various stakeholders
Resources (financial and management)
Industrialization: oil extraction and transesterification
Logistics (sales, distribution, export process, shipping)

GENERAL CONSULTING ACTIVITIES

turn-key/Global solution in Biodiesel projects
Research & Development
Institutional and Government support
Project development, Project Financing an Funding
International product commercialization
Logistics (sales, distribution, export process, shipping)
 professional management

Implementation goals

Internal External
capabilities capabilities

Professional
POOL
monitoring
Roles of strategies
stakeholders

Resources Action plan

management

BioVale Energy: your partner in Brazil.

Market scenario and prospects

the price of
crude oil tripled
between early
2002 and mid-
2005 while
natural gas
reaches a level
six times greater
than ten years
earlier.
Source: GTZ/WorldWatch Institute
 The growing gap
 energy companies have not invested in building
enough refinery capacity to meet the growing level of companies have
world demand. World oil production has gone up by 40% not been able to
in the past 20 years while refinery capacity has only find enough new
gone up 15%. oil and gas fields
 to replace the
exhausting ones.

Oil is being
pumped out of
the ground three
times faster than
it is being
replaced by new
oil finds.

the oil reserves discovered between 1950 and 1980 are being run down.
Source: GTZ/WorldWatch Institute
 Will oil prices rise further?

"There are not enough large-scale projects in the development

pipeline right now to offset declining production in mature oil fields
and to meet global demand growth beyond 2007". (Chris Skrebowski,
the editor of the Petroleum Review )

The total amount of

energy that the world
gets from oil and gas
will begin to decline
after 2010.

Source: GTZ/WorldWatch Institute

 What alternative sources to fill the gap?

The global demand for oil is increasing by just over 2%

every year at present.
This increase in demand added to the gap being created
by the declining supply, implies new energy sources each
year equivalent to 4-5 per cent of the world's current oil
production:
around 1,800 million barrels of oil a year.

In 2015, when world gas output ceases to increase to

meet the its growing demand , the new energy sources
would have to increase the annual rate at which they grew

by another 900 million barrels.

Source: GTZ/WorldWatch Institute
 What alternative sources to fill the gap?

 The only truly sustainable energy sources are those based

on the flow of energy from the sun: solar, hydro, wind,
wave, biomass.

These flows are very large in comparison with humankind's

use of energy.

Renewable sources can therefore meet all the world's

energy needs, both now and in the future.

The amount of energy supplied by renewable sources

could be 120 times its present level .
The problem is to develop these sources
quickly enough to fill the gap as it opens up.
Source: GTZ/WorldWatch Institute
 Biofuels: a Booming Industry

The world is on the verge of

unprecedented growth in the
production and use of biofuels , by
virtue of:

 Rising oil prices, national security

concerns, the desire to increase farm
incomes, and a host of new and
improved technologies .

The two most prevalent biofuels are

ethanol and biodiesel.

World production of ethanol more

than doubled between 2000 and 2005,
while production of biodiesel
quadrupled.
 RET OPPORTUNITIES

Renewable energy will have to supply a greater share of the world's
energy requirements.

It is estimated that the market for clean energy technologies could

be worth $1.9 trillion by 2020. The financial sector has a key role to
play in developing and promoting this market.

In the next 25 years, the world will consume all that has been
produced in fossil oils so far.

The world´s dramatic increment for fuels should be supplied by bio-

fuels.

In the future, In the short run, ETHANOL and BIO-DIESEL are the
main bio-fuels.

Renewable energy is both a solution and a business

opportunity; BUSINESS AS AN AGENT OF WORLD BENEFIT
 Brazilian ethanol´s use and production

PRODUCTION CAPACITY: 18 billion liters/year

PRODUCTION: 15 billion liters/year (seed/2004/2005)

EXPORTATION: 2.4 billion liters in 2004

SUGAR CANE PLANTED AREA: 5.6 million hectares

POTENTIAL FOR AGRICULTURAL EXPANSION IN BRAZIL:

90 million hectares of arable lands – Without any forest removal

INTEGRATED PRODUCTION OF SUGAR AND ETHANOL:

Provide production flexibility

UTILIZATION OF ETHANOL IN VEHICLES IN BRAZIL:

Automobiles, light commercials, motor-cycles and aircrafts

Flexible Fuel light vehicles: reached 37% of internal market sales in 2005
 Brazilian domestic market projection

Law 11 097/2005: it sets forth a mandatory use of biodiesel

mixture to diesel, which reflects in the following prospects

2020
2020

20%
12,4
12,4
billions
billions
liters/year
liters/year

Source: MME
 Brazil’s export potential

With the launch of commercial production, Brazil

becomes a potential exporter of biodiesel.

The EU aims to ensure that 2% of all the fuel consumed

in the region is renewable by 2005, but it has limited
acreage available for growing rapeseed, the main
feedstock produced in Europe, and industrial capacity is
insufficient to meet the stipulated demand.

Despite these constraints, the proportion of renewable

fuels is set to reach 5.75% by 2010 according to EU
Directive 30, ratified by the European Parliament in May
2003.

Given the limitations for production growth in Europe,

Brazilian biodiesel enjoys an unprecedented opportunity
to build market share in the continent Europe.
 Making the project workable

Market Structure & Strategic FUNDING

sight skills alliances

EFFICIENT MANAGEMENT

Applied Technological
planning
methodologies innovation

Competitiveness and sustainability