The world s most advanced biorefinery! Gisle L Johansen Senior Vice President R&D and NBD

The world s most advanced biorefinery! Gisle L Johansen Senior Vice President R&D and NBD

Wood processing industry in Norway 2013

Borregaard is the global leader in biobased chemicals High value added through full raw material utilisation Borregaard s biochemicals are sustainable and environmentally friendly substitutes to petrochemicals

Oil or biomass green or black carbon? GREEN CARBON BLACK CARBON Sustainable chemicals, materials, ingredients, biofuel

New megatrends linked to population growth and urbanisation Borregaard s products meet long term global challenges Sustainable Biofuel Construction Paint Infrastructure Pharmaceuticals and health care Textiles, home products Food ingredients Car/ transportation industries Food/Feed production Soil conditioner Renewable raw materials constitute a sustainable alternative to petrochemicals Green energy solutions strengthen the biorefinery concept Borregaard s biochemicals have documented favourable GHG footprint

Cellulose Acetate a green biopolymer Market and Applications Cellulose Acetate is one of the most common cellulose derivatives: - Cellulose is chemically reacted to form acetate flake. The acetate flake is then dissolved in solvent and spun into fibre (tow or yarn), cast into film or melt extruded into plastics - Textile yarn and tow for cigarette filters - LCD Screens and photographic film - Transparent and pigmented film (for lamination, tape and packaging) - Plastics, e.g. tool handles, spectacle frames & tape Acetate Flake

A large producer of cellulosic (2G) ethanol since 1938 C6 sugars from spruce hemicelluloses are fermented in a continuous process to produce 20 million liters of cellulosic ethanol CO 2 savings 80 90 % vs. fossil autofuel Yeast recycled since 1938 Photo: Johnny Helgesen

Diesel trucks & buses are running on pure bioethanol!

Million liters But almost no ethanol is used as road transport fuel in Norway 180 160 140 120 100 80 60 40 20 Cellulosic ethanol: Less than 2 million litres 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 Biodiesel (Rapeseed) Bioethanol Source: SSB 08.04.2013

The main reason: Biofuel tax regulations E5, E10 E85, ED95 B7 Diesel tax 50 % NOK 1,90/l Petrol tax 100 % 0 % NOK 4,80/l B30 - B100 50 % NOK 1,90/l The biodiesel share in auto diesel (B7, B30) has exemption from CO 2 -tax and 50% reduction of road-use tax. Pure biodiesel (B100) has half road-use tax. Ethanol in gasoline (E5, E10) has exemption from CO 2 -tax, but not from roaduse tax. Mix containing >50 % ethanol (E85 and ED95) has full exemption from road-use tax. The mandatory target of 3,5 % blend of biofuels prohibits growth for ethanol with the current duties

Value creation through specialisation and innovation Microfibrillar cellulose Exilva Innovation Management Teams ~18% of Borregaard s revenues come from new products 90 employees in R&D, of which 76 employees at the R&D centre in Norway 34 are educated to PhD level R&D and innovation spending between NOK 130 and 150 million/year IP strategies for each BU and major innovation projects Green products for the agricultural sector BALI Utilisation of other biomasses for lignin products Developing new process for 2G bioethanol

Borregaard BALI technology Feedstock handling Pretreatment Hydrolysis Lignin chemicals Sugar Biorefinery platform technology Feedstock agnostic Produces sugar solutions and water soluble lignin Utilize more then 80% of incoming feedstock to products Key attractions Lignin with market value substantially higher then energy Low enzyme demand and high yield Pure sugar solutions, perfect for value added fermentation processes Ethanol Green chemicals

Lignin as a dispersing agent

Lignin in lead batteries Crystal growth modifier which gives better discharge/charge performance Prevents the negative plate from forming a solid mass of lead sulphate during the discharge cycle Instead lignosulfonate promotes formation of long needle like crystals which have a greater surface area and are more easily converted back to the original state on charging This translates into + extended battery life + superior cold-crank capability + increased reserve capacity

Exilva Standard Fibers De-fibrillation Microfiber High Shear Processing Length: 2-3 mm Width : 20-60 μm Aspect ratio: 150 Small surface area Controlled de-fibrillation High aspect ratio Very large surface area Length: up to 100 μm Width : 10-100 nm Aspect ratio: 10 000 Large surface area PowerFiber Unique properties 2% in water 2% in water

En blomstrende bioøkonomi Norge må satse på løsninger som tilfredsstiller strenge bærekraftskriterier; både miljømessig og økonomisk Det må aksepteres og kompenseres for at det tar tid (også i fullskala) før en teknologi er fullt ut konkurransedyktig Norge må satse der vi har forutsetninger for å lykkes Samarbeid med utenlandske miljøer som kompletterer vår kompetanse bør støttes Samarbeid på markedssiden er spesielt viktig Industrien er avhengig at sterke FoU-miljøer bygges opp på universiteter og høyskoler, slik at framtidig rekruttering til egne miljøer er sikret Bioraffineri løsninger Like støtteordninger for energi, drivstoff, materialer og kjemikalier fra biomasse Støtteordninger til alle steg i utviklingen, fra grunnleggende forskning til demonstrasjonsanlegg Ingen teknologivalg skal defineres fra myndighetene Samme støttenivå som EU: 50 %