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Africa Renewables Ltd. Connecting Africa to the green energy economy February 2011

AfriRen Teaser Feb2011

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Africa Renewables Ltd. (AfriRen) provides European industry with stable, long term supplies of quality biomass. Established by senior energy trader J.F. Guillon to develop renewable energy projects in Africa, we employ cutting edge technology and operations whilst respecting the environment and local communities. With a headquarters in London and offices in Accra and Abidjan, we form a link that ensures that both customer and vendor fully benefit from the new opportunities provided by sustainable African biomass.

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Page 1: AfriRen Teaser Feb2011

Africa Renewables Ltd. Connecting Africa to the green energy economy

February 2011

Page 2: AfriRen Teaser Feb2011

Mission & Vision

• Long term sourcing of biomass for European utilities.

• Always meet sustainable international standards

• Competitive advantages: secured supply, social impact, attractive economics and potential for expansion

• Long term sourcing of biomass for European utilities.

• Always meet sustainable international standards

• Competitive advantages: secured supply, social impact, attractive economics and potential for expansion

Page 3: AfriRen Teaser Feb2011

Established in 1964

Workforce 21,000+

Turnover (2008) € 600 million

Net result € 69 millions

Biomass is sourced from SIFCA, the first agro-industrial group in West Africa

Strategic plan to replicate model across SIFCA’s WAF plantations

85,000 ton/year

120,000 ton/year300,000 ton/year

Page 4: AfriRen Teaser Feb2011

Social impact of biomass projectsLocal community

• Additional jobs• Support small-scale

charcoal and timber trade

• Primary forest threat is alleviated

Plantation Manager

• Biomass income is an incentive for replanting

• Biomass logistic chain of extraction prepares the ground for replanting .

European end-user

• Reduces compliance costs for EU 202020

• Access to high-quality long-term biomass supply for co-firing or dedicated-biomass generation

Page 5: AfriRen Teaser Feb2011

Overall EU target

0 10 20 30 40 50

Sweden

Finland

Austria

Portugal

Denmark

Estonia

Romania

France

Spain

Germany

Greece

Italy

Ireland

Poland

Great Britain

Netherlands

Belgium

Czech Rep

Hungary

Share in 2005

Increase to 2020

Individual country targets for renewable energy generation

Total biomass demand for power generation

0

10

20

30

40

50

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Bio

ma

ss d

em

an

d (

mill

ion

od

t)

Belgium Denmark Italy Netherlands Spain United Kingdom Sweden

Potential European wood demand for energy

EU 2020 regulations is driving biomass demand growth

The single largest increases in woody biomass consumption for energy generation are expected to develop from:

• Sweden (+6.5 million odt or 28%)

• Italy (+3.0 million odt or 132%)

• UK (+3.0 million odt or 590%)

Share of electricity produced from renewable energy sources (%)

Page 6: AfriRen Teaser Feb2011

6

Combined demand for woody biomass of energy utilities in Europe to grow 4x by 2020

2010 13 million odt/yr2015 33 million odt/yr2020 57 million odt/yr

0 2 4 6 8 10 12 14 16

EDF

E-ON

RWE

Vattenfall

Electrabel

DONG

DRAX

Scottish & Southern

MGT

Helius

Prenergy

Anglessey Aluminium

Projected Wood Demand (million odt)

2020 2015 2010

Page 7: AfriRen Teaser Feb2011

AfriRen pioneers in its Ghana project

• Only two similar projects in Africa:

Buchanan Renewables is a company established with Canadian funds with the objective to develop a woodchip exporting business from Liberia. In June 2010, Vattenfall and Swedfund acquire 30 percent of Buchanan Renewables Fuel. Vattenfall's share is 20 per cent for €20 million, and Swedfund's 10 per cent €10 million.

MagIndustries was established in 1997 to evaluate key mineral licenses acquired in the Republic of Congo. Today, the company has four divisions, one of them, MAGForestry, focuses on eucalyptus plantation near Pointe Noire to supply the pulp and paper industry in Europe.

Page 8: AfriRen Teaser Feb2011

8

GREL Project – annual export of 150,000 mtons of rubber tree biomass from Ghana

Key Concepts Key Figures

Length of contract 8 years

Size of plantation 13,000 Ha

Felling schedule 585 Ha/yr to be felled and replanted

Port logistics Takoradi, less than 100km from plantation

Biomass volume 150,000 gto/year over 8 years

Biomass specs Woodchips from 2011 to 2012Pellets from 2013 to 2018

Export schedule 7-8 cargoes of 15,000 metric tons every month from August 2011

Certification FSC Controlled Wood Standard and Biomass Inventory (SGS auditor)

Quality Within EU guidelines

Page 9: AfriRen Teaser Feb2011

GREL Biomass Extraction Chain

Mechanical harvesting using a feller-buncher

Extraction to roadside by grapple skidder

Roadside de-limbing and cross-cutting by chainsaw

Transport of wood chips to storage area

Roadside chipping into waiting vehicles

Transport to dockside and loading

Page 10: AfriRen Teaser Feb2011

Quality and sustainability standards

Page 11: AfriRen Teaser Feb2011

Rubber wood biomass meets all EU quality guidelinesParameter Unit Method

EU Standard Specifications EN-B

Actual Results Dry Basis

Actual Results as Received Basis

Moisture mass-% DIN EN 14774-1 ≤ 10 16,7

Ash (550°C) mass-% DIN CEN/TS 14775 sim. To DIN CEN/TS ≤ 3,0* 1,6 1,3

Ash (815°C) mass-% DIN CEN/TS 15104 ≤ 3,0* 1,6 1,3

Nitrogen mass-% DIN CEN/TS 15104 ≤ 1,0* 0,50 0,42Net Calorific Value at Constant Pressure (corr. After ash, S, C, H, N) MJ/Kg DIN CEN/TS 14198 16≤ Q ≤19* 17,9 14,5

Chlorine Total mass-% DIN CEN/TS 15289 ≤ 0,03* < 0,05 < 0,05

Sulphur Total mass-% DIN CEN/TS 15289 ≤ 0,04* 0,036 0,03

Arsenic mg/kg DIN CEN/TS 15297 ≤ 1* < 2 < 2

Lead mg/kg DIN CEN/TS 15297 ≤ 10* < 3 < 3

Cadmium mg/kg DIN CEN/TS 15297 ≤ 0,5* 0,3 < 0,3

Chronium mg/kg DIN CEN/TS 15297 ≤ 10* 2 1

Copper mg/kg DIN CEN/TS 15297 ≤ 10* 7 6

Nickel mg/kg DIN CEN/TS 15297 ≤ 10* 6 5

Mercury mg/kg DIN CEN/TS 15297 ≤ 0,1* < 0,1 < 0,1

Zinc mg/kg DIN CEN/TS 15297 ≤ 100* 24 20

Density kg/m³ TAPPI T 258 OM-02 ≥ 600 798

* = in water free condition

Page 12: AfriRen Teaser Feb2011

Cost indication as of February 2011

Woodchips (35% moisture)

Woodpellets(8% moisture)

FOB costs (€/mton) 35 83

Freight (€/mton) 34 22

CIF COST ARA (€/mton) 69 105

€/GJ CIF ARA 5.9 6.4

€/MWh CIF ARA 21.4 23.0

Page 13: AfriRen Teaser Feb2011

Developing a cooperation with a European Biomass end-user

• Supply biomass from Ghana origin on CIF or FOB basis

• Expand sourcing of biomass from Ghana to other WAF countries

• Define sustainability criteria to match end-user requirements

• Explore interest in investing in a pellet mill or AfriRen’s complete value chain

Page 14: AfriRen Teaser Feb2011

Our partners Our advisors

Page 15: AfriRen Teaser Feb2011

Contact

J.F Guillon

Managing Director

Tel: +44 (0) 203 402 5246

Mob: +44 (0) 7768 078199

[email protected]

Sonia Medina

Partner and COO

Tel: +44 (0) 203 402 547

Mob: +44 (0) 7590 976247

[email protected]