Capture and conversion of CO2 emissions for the

sustainable production of algae based value added

products

A presentation from MBD Energy Ltd, February 2011

ATA Melbourne Branch Meeting

16th February 2011

Tony St. Clair

The information in this presentation has been prepared by MBD Energy Limited (MBD) from a variety of

internal sources, which MBD, to the best of its knowledge and belief, considers accurate.

The information in this presentation is general information only and is not intended to provide investment

information.

The information is intended only to provide a brief overview of MBD’s core activities, strategies and

processes.

You should seek further information with respect to any proposed investment in MBD, including advice

from a financial adviser or stockbroker if necessary.

MBD excludes all liability arising out of any inaccuracies in this presentation, except where liability is

made non-excludable by legislation.

Calculated values are approximate values only and may be subject to change.

Disclaimer

22

CCompanyompany Overview / Our Approach

Established in 2006, MBD is Australia’s leader in large scale algae based oil and food production through CO2 bio-sequestration

• Strong and experienced Board and Executive Management Team

• Compelling sustainable solution to 3 significant world issues: oil, food and CO2

• Modular , scalable, fully integrated and automated low cost algae based “CO2 to

energy” system

• Signed Formal Agreements with 3 major Australian CO2 emitters - Binding Contract

(Tarong Energy) / MOUs (Loy Yang Power and Eraring Energy)

• Staged Deployment of 1 Hectare (ha) “proof-of-concept” Display Plant currently

underway - insitu at Tarong Power Station over 12 months to 3Q11

• 3 Stage Commercialisation Plan: (1) Display, 2011;

(2) Commercial, 2013;

(3) Large Scale Expansion, 2015

Company Overview

CCompanyompany Overview / Our Approach

• 2 Patent Applications submitted: (1) International “PCT” (2009); and

(2) Expanded “Provisional” (2010)

• Exclusive relationship, and access to proprietary algae libraries (both micro and

macro), with world leading algae research expertise at James Cook University (JCU),

Queensland

• Existing large scale Research and Development Facility (5000m 2) at JCU

• Cornerstone Investors - Anglo American, 2009.

In principle agreement with an ASX listed company as a second cornerstone equity

investor under this Offer.

• Secured in-excess of A$6.4M in Federal and State Government Grants

• Established Partnerships with Key Tier-1 services and technology suppliers

Company Overview

In very simple terms, here’s how it works:

- MBD captures emissions at the-smokestack, cool

them and pipe them into growth membranes.

- The waste water is infused with the waste

smokestack emissions.

- local strains of algae are introduced into this

carefully controlled environment.

100% of the algae is then sold as biomass, oils,

feeds and food.

Trials with algae, at our R&D Facility at James Cook

University, have selected micro algae that double in

mass every 24 hours to 48 hours when growth in the

membranes and infused with CO2.

Algal Biofuels

Algal oils /

Plastics

Human

Nutrition

Animal Feed /

Aquaculture

CCS Biochar

Fertiliser

Effluent Water

+

Carbon

Dioxide

+

Sunlight

Oxygen

+

Treated Effluent

DischargeWater

Recycling

Algae Farm

CO2 emissions to Value Added Products

www.mbdenergy.com

“Algae is the only organism that

converts CO2 to oil.”

CO2 emissions to Value Added Products

- KH

R&D Facility

6

Base in Townsville the R&D facility provides for all of MBD’s

ongoing R&D work - both micro and macro algae.

The site will provide the Central Control Centre for MBD’s projects

both in Australia and Internationally.

The program of R&D works including:

• Algae strain identification and selection

• Culture optimisation

• Production and scale-up

• Harvest , extraction and separation processes

• End use products

Current algae strain assessment focusing on ~ 12 salt water

and fresh water based algae strains. JCU has 300 strains

and is led by Prof. Rocky de Nys and Ass. Prof. Kirsten Heimann .

6www.mbdenergy.com

R&D FacilityJames Cook University

Micro algaeMicroscopic single cell plants

• Highly efficient growth (up to 4 doublings per day)[MBD is typically working with strains that double every 24 – 48 hours]

• Extremely diverse (freshwater, saltwater, hyper-saline)

• Source of natural bio-oils (energy and lipid profile)

With micro algae MBD selects strains of algae that are

high in useful oils

Algae strains are matched to produce oil ideal for making:

- transport fuel,

- plastics and

- pharmaceuticals;

The remnant algal meal – the dried husk – is a nutritious

feed for animals and aquaculture;

www.mbdenergy.com

The process produces cleaner water derived from removing the nutrients from the waste water

Macro-algaeMacroscopic multi-cellular plants

• Efficient growth (up to 20% per day)

• Extremely diverse (freshwater to hyper-saline)

• Current seaweed aquaculture industry of 15 million

tonnes of biomass pa = A$7 billion pa of production

Similarly, with macro algae we take the CO2 and feed it to

larger seaweeds which is harvested on a weekly basis

then dried and make pellets or briquettes:

• for food

• for feed

• for the power station to use as a replacement

biomass for coal or

• for companies to convert into ethanol and other

products.

These projects provide a viable means to offset the burning of fossil fuels with bio-energy created from

waste water and industrial emissions, including NOx, SOx and CO2, that otherwise would have gone into

the atmosphere – or perhaps in the case of CO2, been buried through GEO CCS.

www.mbdenergy.com

Products

www.mbdenergy.com

Algae – Animal feeds

Mineral supplements - iron, selenium, iodine

• 0 – 50% dietary content

• 20% optimum –

• 20% enhanced feed intake enhanced growth

Algae – Fertiliser

Liquid fertilisers

• high mineral content - iron, selenium, cobalt,

manganese

• Plant growth regulators - cytokinins, auxins,

gibberelins

• Home gardening through to broad acre biological

farming market

Products

www.mbdenergy.com

Algae - CCS Biochar ~ $2000 tonne-1

Biomass - eight species

Pyrolysis - low O2 combustion

Elemental analysis

nitrogen, phosphorous, iron, selenium, CEC

Algae – Bio-oils

w-3, w-6 polyunsaturated fatty acids,

Pure oils, Edible oil, Bioplastics, Biodiesel

Products

www.mbdenergy.com

Algae – Biofuels

Bioethanol – starch, cellulose

Cellulosic ethanol, Saccharification + fermentation

Direct combustion energy

• Pellets

• Briquettes

• Biogas production

Algae – Bioremediation (water)

www.mbdenergy.com

Algae – Bioremediation

Heavy metals

• Removal and recovery

Nitrogen

• Environmental remediation

• Environmental compliance

Phosphorous

• Environmental remediation

• Environmental compliance

• Water reuse

Tarong Display Plant Project - Qld

Over the next 12 months, with a cost $5 million, MBD will

construct and operate a:

1 hectare Bio-CCS Algal “proof of concept” facility.

Then in 2012, subject to the success of the Display project

and sign off from our partner power station, we envisage

construction of a Bio-CCS Algal project at a cost of

approximately $30 million.

Occupying 80 hectares, the “Stage 2” project will be fully

commercial and will produce about 100 tonnes of algae

biomass every day.

Annual oil output will be about 69 thousand barrels and

we would expect to produce 25,000 tonnes of stockfeed.

The Stage 2 facility will result in abatement of approximately 70,000 tonnes per annum of Tarong Power

Station’s flue gas emissions.

www.mbdenergy.com

Eraring Power Station Projects - NSW

Two MBD CO2 Algal Synthesiser projects currently

under assessment at the Eraring Power Station, Lake

Macquarie, NSW.

10 Ha Macro algae Project:

Macro-algae grown from waste flue gases and

harvested for briquette production.

Briquettes may be used in power station’s boilers as a

replacement for coal or biomass for feed and food

products.

2 Ha Micro algae Project:

Growth of higher value algae strains for production of

omega-3, omega-6 or similar type high value oils.

(Both projects currently being scoped and a business plan

finalised.)

www.mbdenergy.com

Two MBD Algal Synthesiser projects currently

under assessment at Loy Yang A in the Latrobe

Valley, Victoria.

Macro algae Project:

5 Ha Macro-algae project

• Growth of macro for briquettes to be used by

Loy Yang

Micro algae Project

• Growth of micro-algae for oil and meal

• Oil for biodiesel production

• Meal for dairy feed

Part one: 1 Ha display project;

Part two: 5 Ha Pilot project.

(Both projects currently being scoped and a business

plan finalised.)

Loy Yang Power Station Projects - Vic

www.mbdenergy.com

MBD’s will expand these projects as normal infrastructure

projects.

The large scale projects have the potential to directly

capture and mitigate up to 50% of the power stations total

emissions.

For every million tonnes of CO2 sequestered:

- 1.7 million barrels of oil

- 370 thousand tonnes of algal meal.

The three power stations are Australia’s largest and

between them are responsible for meeting upwards of 20%

of Australia’s current coal fired electricity demand.

MBD’s plans to achieve large-scale “CO2

to Energy” projects.

www.mbdenergy.com

MBD’s CO2 to energy Process Summary

Algae Synthesiser Farm

Land (low value buffer)

Each million tonnes of CO2 e

sequestered produces the following

outputs:

550,000 tonnes of algae:• 180,000 tpa algae oil

• 370,000 tpa nutritious livestock feed

CO2 EmitterGreenhouse gases collected at the

base of the chimney and piped to

MBD Algae Farm. (CO2 NOx SOx)

• Power Plant ,

• Gas Plant & Refineries,

• Cement Kiln,

• LNG Facility,

• Coal Seam Gas Production,

• Other processes

Waste NutrientN, P, K, S

• Sewerage

• Waste from feedlot

• Waste water

Supplemented with

• Commercial fertiliser

Sunlight

O2 H2O

Algae Oil (1/3rd )

Oil Options Include

Biodiesel Production

Plastic Production

Jet fuel, other fuels

Algae Meal (2/3rd)

Meal Options Include

Feed for livestock industry

Feed for fertilser

Biomass for bio-plastic

production

Biomass for electricity production

Key consumption / output rates

• 100% of algae used as value added product

• Typically, 1 tonne C02 emitted per MWhr generated

• Require ~2 tons of C02 per 1 tonne of algae grown

• Require ~1000+ Ha Land per 1 M tonnes of C02