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Dr. Carl KukkonenCEO VIASPACE Inc., USAkukkonen@viaspace.comwww.viaspace.com

Nicaragua 12 MW Biomass Power Plantwith 840 Ha Energy Crop Plantation

Private Power in Central AmericaPanama City, Panama

June 12 – 13, 2014

Giant King Grass Dedicated Energy Crop Example Biomass Power PlantIn Development-- NOT BUILT YET

Nicaragua Project Overview

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Closed LoopBiomass Power Plant

• Power plant co-located with Giant King Grass(or other biomass) plantation

• Water and sunshine in–clean, low carbonelectricity out

VIASPACE Power Plant Partner Customer

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EPC

Biomass is Low Carbon FuelPlants Breathe Carbon Dioxide

• Plants use sunlight &CO2 to grow. Carbonis stored in the plant

• Burning biomass orbiofuels simplyrecycles the CO2stored in the plant– Time can be 6 mos -

grass to 20 yrs-trees• Biomass is carbon

neutral except from– Fertilizer, harvesting,

& delivery 4

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Nicaragua Renewable BiomassEnergy Project Overview• 12 MW biomass power

plant designed for grass,straw & rice husk as fuel– Proven technology– Provides clean, reliable 24/7

base electricity• Dispatchable base power

• Fueled by Giant King Grass– Dedicated energy crop– Sustainably grown– Irrigation and rainfall– Rice husk as additional fuel

•

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Project status

Pre-feasibility studySPV company established Presentation to investors (debt and equity) Feasibility study in progress Provisional generation license, power

purchase agreement, permits and othercontracting tasks in progress Financial closure

17/06/2014 www.pelicansa.com 6

Biomass Power Plant Financing

• First question from banker for biomass powerplant is “show me your fuel supplyagreement.”– We are “growing our own electricity”

• Power purchase agreement from acreditworthy counterparty

• Proven technology• Qualified EPC contractor that will guarantee

cost, schedule and performance• Management/operations team

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Nicaragua

• Largest country in Central America (in area)• Large agriculture sector• 5M people, 6M cows• Now safest country in region• Poor, but no misery• Tropical climate

– Rainy & dry seasons• Bunker oil is base for electricity

– Also hydroelectricity for rainy season and windfarms 8

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Nicaragua

• Policy is green electricity with lower cost thanoil

• But hydro is seasonal and wind intermittent– Grid cannot handle any more intermittent

• No incentives except 7 year tax break & noimport duty on renewable equipment

• Nicaragua has low labor costs and industrywants to move there– But needs reliable electricity

• Can sell electricity to grid and private industrydelivered by grid

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AGRICORP is Partner

• Agro-industrial company in Nicaragua• Mills, distributes and grows rice• Has more than 50% of the rice market in

Nicaragua• Giant King Grass growing on AGRICORP

plantation since 2012• AGRICORP investors and VIASPACE have formed a

special purpose company for the 12 MW powerplant and Giant King Grass plantation– In development—not built

• “Energia Reino Verde”—Green Kingdom Energy10

Rice as Far as You Can See

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Rice as Far as You Can See

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Giant KingTM Grass

• High yield dedicated energy crop• Harvested twice a year at 4 m tall• Perennial crop, cut and regrow for 7 – 10 years• A natural proprietary hybrid, not genetically

modified• Sterile and noninvasive• Propagated vegetatively like sugarcane• Will grow on marginal land• Tropical and subtropical grass

– Will survive a frost, but not freezing weather• Needs warm weather, sunshine and rainfall or

irrigation 13

Giant King Grass Plantationat AGRICORP Rice Plantation• Located on 10,000 acre AGRICORP

farm at Miramontes– 6000 acres planted in rice– 2100 acres of Giant King Grass to fuel

initial 12 MW power plant– Giant King Grass already growing well

there• Irrigation from Lake Nicaragua in

place• Will leverage existing farm staff

and infrastructure to lower costs• Purchase special harvesting and

transporting equipment forGiant King Grass

• Maximum distance to power plantis 5 km assuring simple logistics

• Reliable, low-cost, renewable fuel14

Giant King Grass Grownin Nicaragua for 16 months

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Expanded Giant King GrassPlantation

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Planting by Hand

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Irrigate Right after Planting

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10 Week Old Giant King Grassin Nicaragua

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Energy Crop and Animal Feed

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Mature Giant King GrassHarvested Every Six Months Plantation on Lake Nicaragua

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12 MW Power Plant Nicaragua

• 12 MW gross• Efficiency

– 32% lower heating valueof the fuel to electricity

• 11% internal use• 7884 hours/year• 84 M kwh saleable

electricity• 9 dry equivalent metric

tons/hour fuel use• Lifetime 25 years

• Operating costs/kwh– Fuel $0.038– Labor $0.008– Other $0.006– Total $0.052

• Debt 70%– 8.5%, 12 years

• Equity 30%• All-in capital ~$3M/MW

– EPC, civil works, short gridconnection, legal,plantation establishment onleased land

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World Electricity Usageper Capita

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PanamaCosta Rica

HondurasGuatemala

Nicaragua

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12 MW Giant King GrassPower Plant in Nicaragua

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• Provides clean renewable baseelectricity

• Reliable 24 hours/day• Not intermittent like wind and

solar . Complements hydro• Lower cost than oil and solar• Plantation and power plant

provide jobs• Electricity infrastructure for

people and industry• Utilizes the natural resources

of Nicaragua– sunshine, warmweather and water

• Sustainable agriculture• Money stays in Nicaragua

rather than spending moneyfor oil overseas

Giant King Grass Overview

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Giant KingTM Grass

• Perennial grass. Plant once and harvest for 7 to10 years

• First harvest at 6 ½ months after planting whengrass is 4 to 5 m tall and suitable for burning

• Subsequent harvests every 5-6 months• For anaerobic digestion, Giant King Grass is

harvested at 2m tall every 60 days• In tropical area with good rainfall or irrigation,

can harvest all year long when the fields areaccessible– Continuous just-in-time harvesting simplifies logistics

and storage and allows for a larger permanentworkforce with few temporary workers

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Giant KingTM Grass

• C4 plant that thrives in hot weather• Drought tolerant, but irrigation is highly

recommended if there is an extended dryseason in order to guarantee yields requiredfor power plant

• High water use and fertilizer use efficiency– Efficiency= dry matter produced/water or fertilizer

input• No pesticide used in California

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Giant King Grass Approved byUS Department of Agriculture• US Department of Agriculture has grown Giant

King Grass and found it to be free of diseaseand pests

• Approved for distribution in US and for export• USDA will inspect Giant King Grass and issue

phytosanitary certificate for export

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Giant King Grass

• 15 + feet tall in 6 months• Harvest tall 2 times a year• Growing in

– US-California, Texas, Arizona,Hawaii

– St. Croix, US Virgin Islands– Nicaragua– Myanmar– South Africa– China– Pakistan– Guyana 30

Giant King GrassCompared to Other Grasses• Giant King Grass is a very high yield, sterile hybrid

that is both an excellent energy crop and animalfeed. It is noninvasive.

• Local Pennisetum Purpureum (Napier grass)cultivars are called King grass in Central America.These generally have lower yield and are not welldocumented. Pennisetum Purpureum is listed asan invasive species in some areas.

• Arundo Donax (Giant Reed) is being promoted asan energy crop. It generally has lower yield. It isnot good animal feed, and is listed as an invasivespecies. It does survive freezing winters.

• Miscanthus and switchgrass have much loweryields and are not tropical grasses. 31

Mechanical Plantingof Giant King Grass

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Harvest with Machete

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Manual Harvesting withGas Powered Cutter

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Mechanical harvesting

Giant King Grass Growth Cyclein California

Perennial Crop, Plant Once Harvest Many Times

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37Giant King Grass growing in California

Giant King TM GrassMarch 17, 2013– Just Harvested

38Surface or subsurface drip tape irrigation, row & furrow or flood irrigation can be used.

Giant King TM GrassMarch 27– Regrowth in 10 days

39Giant King Grass in the left rear is 18 feet tall

Giant King TM GrassApril 18, 2013– One Month Old

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Giant King TM GrassMay 13, 2013– Two Months Old

Ready for harvest for animal feed (14.9% crude protein) or anaerobic digestionFor reference VIASPACE CEO Dr. Carl Kukkonen is 6’1” (185 cm) tall

Giant King TM GrassMay 30, 2013– 2 ½ Months Old

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Giant King TM GrassJuly 2, 2013– 3 ½ Months Old

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Giant King TM GrassJuly 31, 2013– 4 ½ Months Old

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Giant King TM GrassAugust 28, 2013– 5 ½ Months Old

Ready for propagation or harvest

Giant King TM GrassSeptember 29, 2013– 6 ½ Months Old

46Strong growth– ready for harvest or propagationFor reference VIASPACE CEO is 6’1” (185 cm) tall

Direct Combustion Power PlantProven Technology

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30 MW power plant uses corn straw &rice husk.Giant King Grass is same as corn straw

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Direct CombustionBiomass Power Plant

Biomass fuel handling Special boilerburns biomassto create steam

High pressure steamturbine turns generatorto make electricity 49

Giant King Grass Has Been ExtensivelyTested With Consistent Results

Proximate Analysis UnitSun Dried

As ReceivedGiant King Grass

Bone Dry

Total Moisture % 14 0

Volatile Matter % 65.68 76.37

Ash % 3.59 4.17

Fixed Carbon % 16.74 19.46

Total Sulfur % 0.11 0.13

HHV MJ/Kg 15.85 18.43

LHV MJ/Kg 14.52 - 50

Grass & Straw Boilers Are Tricky

• Most biomass boilers are designed for woodor sugarcane bagasse

• Wood is an excellent fuel with low ash, highmelting temperature ash and low chlorine.

• Corn straw, wheat straw, rice straw, rice huskand grasses have higher ash, low meltingtemperature ash and higher chlorine

• These will destroy a wood or sugarcane boilerdue to slagging and corrosion

• Must have a special boiler design51

Power Plant TechnologyIs Well Proven

• Special high temperature,high pressure boiler with30% efficiency overcomesslagging & corrosion issueswith straw as fuel– Straw has low melting

temperature ash & highchlorine content

• Water cooled vibratinggrate

• Proprietary primary &secondary air control

• Materials for corrosion• Can also use wood,

bagasse & other biomass• Long life, high availability,

low maintenance 52

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5330 MW biomass power plant control room 54Steam turbine and generator

Agricultural Fuels Can CauseSlagging & Corrosion• Low melting temp ash

causes slagging• High chlorine corrosion• Must have proper boiler

design

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Low cost 10 MW biomass power plant with manual operations and inexpensive boilerrequires high maintenance due to slagging on super heaters and boiler surfaces

NOTRECOMMENDED

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Additional Giant King GrassApplications

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Giant King Grass Pelletsas Coal Replacement• Giant King Grass pellets can

replace up to 20% of coal inan existing coal-fired powerplant– Burning coal and biomass

together is called cofiring– Requires small modification

• Preserves large capitalinvestment in existing powerplant with 30 year additionallife

• Meets carbon reductiontargets

• 16M tons of pellets usedglobally today– 46M tons by 2020

• Grass is grown, dried andpressed into pellets andshipped in bulk like shippinggrain

• Large global demand– Particularly in Europe– Korea, China, Japan emerging

Him him him him him

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Test Data on Giant King GrassShows Consistency of Product

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Biogas Power Plant is OptionThousands Operating in Europe

Completely stirred anaerobic digester

engine generator set

1 MW enginegenerator set incontainerWaste engine heat

used to heatgreenhouses

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When Cut at 5-7 Feet TallGiant King Grass Is Excellent Animal Feed

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Feeding Cattle

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Giant King Grass Can Be Used AsFeedstock for

Biofuels, Biochemicalsand Biomaterials

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Giant King Grass is the Same asCorn Stover w/ Much Higher Yield

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Composition- GlucanXylan & Arabinanare sugars for cellulosicethanol. Lignin & ashare byproducts

One dry ton of Giant King Grass is slightly better than corn Stover for cellulosic ethanol

Giant King Grass has much higher yield per acre than corn Stover

High Yield of Giant King GrassMeans High Ethanol Production

0

500

1000

1500

2000

2500

3000

3500

4000

Corn Grain Corn Stover Sugarcane Giant KingGrass

Ethanol Production gallons per acre

Ethanol Productiongallons per acre

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Imperial County CaliforniaMesquite Lake Water and Power

• Partner owns closed 16 MW biomass power plant inImperial California– Plans to reopen with portion of fuel from Giant King Grass,

majority from wood waste• Has option on adjacent closed 16 MW manure

gasifier power plant.– Plans to convert to biofuels plant with GKG feedstock

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Tibbar EnergySt. Croix, Virgin Islands

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• Planned 7 MW biogas power plant• Giant King Grass growing well• Tibbar awarded power purchase agreement• All permits in place

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Compare Wind, Solarand

Giant King Grass Electricity

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Wind Energy Has No Fuel Costand No Carbon Dioxide Emissions

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Wind Energy is IntermittentAverage Electricity is 34% of Peak

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Average is34% of peak

Intermittent Wind Electricity NeedsFast Reacting Backup Generator

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or DIESEL BACKUP

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Solar Photovoltaic—Fuel Is Free& No Carbon Dioxide Emissions

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Solar Electricity Output for 7 daysin Arizona–note Effect of Clouds

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Average=25% ofPeak

Clouds during the day

Cloudyday

Managing the Electrical Grid

• Base or dispatchable electricity comes fromsources that have reliable and dependableproduction– electricity from oil, natural gas,LPG, coal, nuclear, biomass, geothermal

• Seasonal sources are useful, but requirebackup during the off-season– hydroelectricityduring the rainy season and sugarcanebagasse during sugar season– These are dispatchable during part of the year

• Intermittent sources– wind and solar--requirea constant source of backup power 75

Managing the Electrical Grid

• Wind and solar require fast respondingbackup power that is provided by oil and gas– there is no way to store electricity except by

pumping water back up a dam• 1 MW of wind or solar generation requires

approximately 1 MW of backup generationfrom oil or gas– Have to build two power plants-one wind or solar

plus one backup oil or gas power plant– The backup power plant must be kept spinning so

it can react quickly and must be maintained• These are costs that must be paid even if it is not

generating electricity—capacity charge 76

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Cost of Level Electrical OutputFor Renewables Plus Backup

ElectricitySource

Cost perkilowatthour 1

Availabilityfactor(24hr)2

Oil backupneeded(24 hr)

Constant 24hour poweroutput cost/kwh3

Relativecarbondioxideemissions

Bunker oil $.20 1.00 0 $.20 100%wind $.08 – $.12 0.34 0.66 $.173 66%solar $.10 – $.14 0.25 0.75 $.185 75%Giant KingGrass Biomass

$.12 – $.14 1.00 0 $.14 0%

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1 Total cost at power plant gate including fuel, operations, substation,capital equipment costs, finance charges and profit

2 Global averages of wind and solar availability over 24 hours3 Uses $.10 for wind, $.12 for solar, $.14 for Giant King Grass biomass,

and $.02/kwh for the spinning reserve required to back up solar and windWind calculation ($.10+$.02) x 0.34+$.20 x 0.66= $.173/kwh averaged over 24 hoursSolar calculation ($.12+ $.02) x 0.25+ $.20 x 0.75= $.185/kwh averaged over 24 hours

Renewable Energy Strategy

• Wind, solar and biomass are all good optionsfor renewable, low carbon electricity

• Each has a role and limitations• Biomass is dispatchable base power, but

needs land to grow the crop and sufficientrainfall or irrigation

• Wind needs a windy area and is intermittentrequiring backup power

• Solar needs good sunshine and backup power78

Bioenergy Applications ofGiant King Grass

• Direct combustion in electric power/heat/steam plant

• Pellets for co-firing with coal• Briquettes for boilers• Biogas /anerobic digestion• Cellulosic liquid biofuels--

ethanol/butanol• Biochemicals and bio plastics• Pyrolysis to bio oil• Catalytic coversion to bio diesel• High-temperature gasification• Torrefaction to bio coal• Pulp for paper and textiles

Applications thatare commercialtoday withagricultural &forestry wastethat can use GiantKing Grass instead

Low cost ofGiant King Grasswill allowcommercialapplicationsin future

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Benefits of Giant King Grass• Renewable, low carbon energy source that can be

locally grown and provide jobs & energy security– Less expensive than oil or liquefied natural gas

• Can generate electricity 24 hours per day– Solar and wind are intermittent not base power

• Carbon neutral electricity production and growth• Uses modern sustainable agriculture practices• Can also feed cattle, dairy cows, pigs and other

animals or make pellets for export• In the future, Giant King Grass feedstock can produce

liquid biofuels, biochemicals and biomaterials80

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Advantages ofGiant King Grass• “Platform” energy crop for many bioenergy applications

– Electricity, pellets, biofuels, biochemicals & bio plastics

• Excellent animal feed with high protein• Lowest cost--Can meet cost targets for energy & biofuels

applications because of high yield of Giant King Grass– Less expensive than agricultural waste

• Perennial crop– Do not have to plant every year, just harvest– Short rotation—first harvested in 6.5 months

• Provides reliable, well documented, consistent qualityfuel or feedstock with predictable, affordable price– Fuel supply reliability required for project financing 81

What Are We Looking for?

• Nicaragua project– Majority of equity will be provided by Nicaraguan

partners– Minority equity position available to investors who

interested in this and future similar VIASPACEprojects

– Debt financing• interest has been shown, but not settled yet

– Interviewing EPC contractors

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What Are We Looking For?

• VIASPACE intends to pursue additionalprojects in the region

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Thank You

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• VIASPACE is a publicly traded company on theUS OTC Bulletin Board– VIASPACE stock symbol VSPC.OB

Safe Harbor Statement: Information in this presentation includes forward-lookingstatements which relate to future events or performance, and involve known andunknown risks, uncertainties and other factors that may cause our actual results,levels of activity, performance or achievements to be materially different from thoseexpressed or implied by these forward-looking statements. Such factors include,without limitation, risks outlined in our periodic filings with the U.S. Securities andExchange Commission, including Annual Report on Form 10-K for the year endedDecember 31, 2011, as well as general economic and business conditions; and otherfactors over which VIASPACE has little or no control.

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Dr. Carl KukkonenCEO Biography

1998-PRESENT VIASPACE Inc. CEO—Originally products “VIA” the “SPACE” program1984-1998 NASA/Caltech Jet Propulsion Laboratory (JPL)

Director Center for SpaceMicroelectronics Technology& Manager of Supercomputing

– Led staff of 250 with $70 million annual budget– On review boards of 14 leading universities– NASA Exceptional Achievement Award 1992– Space Technology Hall of Fame 2001

1977-1984 Ford Motor Company– Developed direct injection diesel engine– Ford’s expert on hydrogen as an automotive fuel– Research in Physics Department

1975-1977 Purdue University postdoctoral fellow1968-1975 Cornell University MS & PhD in theoretical physics1966-1968 University of California Davis BS physics

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Ultimate Analysis-Comparisonw/ Corn, Wheat and Rice Straws

87Giant King Grass is very close to corn straw and wheat straw. Rice strawhas higher ash. A boiler for corn straw can be used for Giant King Grass.