| Authorized |
| Date |
Shares |
Source |
| 3/31/2008 |
240,000,000 |
10QSB |
| Outstanding |
| Date |
Shares |
Source |
| 5/12/2008 |
61,120,278 |
10QSB |
|
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 CleanTech Biofuels, Inc. (CLTH.OB)
CLTH is in the process of demonstrating and quantifying the efficacy of a set of technologies that, when combined, are cost affectively capable of converting municipal solid waste into ethanol.
By using the existing infrastructure for municipal solid waste collection and disposal to collect biomass at a low or negative feedstock cost, CleanTech will achieve profitability quickly relative to other cellulosic ethanol producers who must develop their infrastructure to collect and transport more expensive feedstocks such as switchgrass, wood waste, or corn stover. Moreover, biomass derived from garbage will not be subject to increases in commodity prices that plague producers currently manufacturing ethanol from corn.
CEO of CleanTech Biofuels, Inc., Edward Hennessey, commented: “As ethanol production from food crops has exploded in recent years, there are increasing concerns over the amount of arable land once used for food production being displaced for energy crops. Additionally, concerns have been raised regarding the energy and pollution balance of other methods of ethanol production. Consequently our business model which leverages the existing infrastructure for municipal solid waste collection and disposal to collect biomass at a low or negative feedstock cost is beginning to receive the recognition we feel it deserves.”
Hennessey further stated: “We believe that we will achieve profitability quickly relative to other cellulosic ethanol producers who must develop their infrastructure to collect and transport more expensive feedstocks such as switchgrass, wood waste, or corn stover. Moreover, biomass derived from garbage should not be subject to increases in commodity prices that plague producers currently manufacturing ethanol from corn.”
Their unique technology package positions them to be the industry leader in using municipal solid waste (MSW) as the primary feedstock for energy production. Municipal Biorefineries developed with their technology will:
 Reduce the costs of transporting waste long distances for disposal.
Dramatically reduce pollution released into the environment by the disposal of municipal solid waste.
Reduce the amount of material going into landfills by as much as 85%.
Increase the amount of recyclable materials that can be recovered from municipal solid waste.
Generate biofuels and other usable energy products at competitive prices.
Technology
Due to over strained landfills, MSW is increasingly becoming a problem for many U.S. cities and regions. CleanTech has licensed the exclusive rights in the United States to a technology that can convert MSW into a biomass material that we refer to as Process Engineered Fuel (PEF,Patent No. 6,306,248 Dated: October 23, 2001. Their process employs heat, steam and agitation to convert the raw MSW into an output stream with uniform moisture content and particle size, roughly the consistency of compost, while simultaneously cleaning the other fractions of the garbage and removing a substantial amount of the volatile organic compounds (VOC's) from the garbage. However, while the output resembles compost, it is high in cellulose content, making it an excellent feedstock for conversion to ethanol.
 Further, CleanTech has licensed a patented (Patent No. 5,411,594 Dated: May 2, 1995), proprietary technology capable of converting the PEF output from the above technology into a fermentable sugar stream. This process is a unique and improved variation of what is generally known as two-stage, lignocellulosic acid hydrolysis. BEI, Inc. has developed a version of this technology that reduces its operating costs to the extent that it is cost competitive with corn-based ethanol production. Additionally, CLTH has an exclusive agreement with HFTA, Inc. to license technology as described in U.S. Patents No. 5221357, 5366558, 5536325, 5628830, and 6019900 that utilize nitric acid for hydrolyzing cellulosic material rather than sulfuric or hydrochloric acid. The use of nitric acid for this process creates a number of efficiencies that CLTH believes will make their system significantly more efficient than any other acid hydrolysis process in development. Currently, they are designing a system that integrates the BEI Process together with the HFTA process.
The final piece of the ethanol production system is the fermentation of the sugar stream into ethanol. CLTH has identified a fermentation technology developed at Purdue University that will produce high yields of ethanol from the sugar stream output and are in the process of testing and licensing the Purdue technology. Together these technologies represent an elegant and relatively simple method by which to solve the landfill scarcity problem while producing a very valuable output product, ethanol.
Market -Feedstock Costs & Availability
The US Department of Energy (DOE) has set a goal to validate a high quality feedstock supply of cellulosic biomass of 130 million dry tons p/ year by 2012 and 250 million dry tons p/year by 2017. *1
The DOE has set target goals for feedstock costs (i.e. harvesting, storage, preprocessing and transportation excluding the cost paid for biomass) of $0.37 per gallon in 2012 and $0.33 per gallon in 2017.
 Of the 245 million tons of waste generated annually in the United States, at least 50% is cellulosic biomass, representing a potential source of 120 million tons of feedstock per year.
The nation's and world's appetite for such a system is almost unlimited. Americans produce 4.4 pounds of waste per person per day, or 229 million1 tons annually nationwide. At the estimated conversion rate of these technologies of 52 gallons of ethanol per ton of garbage, this MSW represents a potential fuel source of over 6.5 billion gallons of ethanol per year. Current annual targets of both the Administration and Congress for future domestic ethanol production are about 35 billion gallons, and CleanTech's system will help the U.S. meet this goal.
Competition
There are many companies and entities vigorously pursuing implementation of cellulosic ethanol production technologies. Three basic versions of technology for converting cellulosic biomass into ethanol exist: 1) enzymatic hydrolysis, 2) acid hydrolysis, and 3) thermochemical. Of the three, acid hydrolysis is the most proven and tested. While other of these technologies may prove economically and technically feasible in the future, we believe CleanTech's licensed technologies will prove to be the most efficient and reliable process relative to other cellulosic ethanol conversion technologies.
 In addition, we believe that the size of the energy market combined with the immense diversity of potential feedstocks provide market opportunities for a large number of technologies and producers of cellulosic ethanol. The opportunity presented by municipal solid waste remediation and production alone is immense and could support many MSW ethanol production companies. We do not by any means dismiss competition, but we believe that our business model is well-positioned to withstand it and thrive.
Partnering With Existing Infrastructure
The existing infrastructure for collecting, separating, recycling and or disposing of municipal waste is easily adaptable to support Cleantech Biofuels' system without adding any significant logistics costs.
Currently municipalities pay tipping fees to landfill operators to accept garbage. Those tipping fees will be paid to Cleantech Biofuels for accepting the waste it processes.
By partnering with municipalities and existing waste haulers, Cleantech Biofuels believes that its system can be more rapidly deployed on a commercial basis than any other cellulosic ethanol technology. Simultaneously reducing cost and pollution for municipalities and enhancing the profitability of existing waste haulers.
Executive Officers
Edward P. Hennessey, Jr.
Mr. Hennessey currently is Chief Executive Officer and President of the Company, and serves as Chairman of the Board of Directors He also serves as a Class III director with a term that expires in 2010. Mr. Hennessey has been the President and CEO of SRS Energy since 2003, and as President of Supercritical Recovery Systems, Inc. prior to that time since 2002. Mr. Hennessey began his career in Finance with Shearson Lehman Brothers in 1986 and worked in the securities industry from 1986 until 2000.
Michael D. Kime.
Mr. Kime currently serves as General Counsel and Chief Operating Officer of the Company. Prior to joining the Company in August 2007, Mr. Kime was a partner in the law firm, Sauerwein, Simon, Blanchard & Kime, P.C. from 2005 until 2007 and as an associate at that firm from 2002 until 2005. Mr. Kime has been a practicing attorney since 1994, focusing on securities laws, finance, and mergers & acquisitions. Mr. Kime serves on the Board of Directors of Missouri Votes Conservation, a bi-partisan lobbying group that supports pro-conservation legislation in Missouri. Mr. Kime also co-wrote and co-produced the award winning documentary film, Can Mr. Smith Get to Washington Anymore? Mr. Kime initially was hired as General Counsel of the Company. In February 2008 he was promoted to Chief Operating Officer.
Thomas Jennewein.
Mr. Jennewein currently serves as Chief Financial Officer of the Company. Prior to joining the company in August 2007, Mr. Jennewein served as the Manager of Financial Reporting for Maverick Tube Corporation from 2005 until 2006, when Maverick Tube Corporation was acquired by Tenaris, S.A. At Maverick Tube Corporation, Mr. Jennewein was responsible for preparing all of the company's filings with the Securities and Exchange Commission. Before joining Maverick Tube Corporation, Mr. Jennewein held a similar position at Argosy Gaming Company where he served as Manager of Financial Reporting from 2000 until 2005.
Supporting BioMass Data:
US Department of Energy: http://www.doe.gov
Energy Efficiency and Renewable Energy - Biomass Program: http://www1.eere.energy.gov/biomass/
Cellulosic Ethanol Resources:
We have what we need now to produce ethanol from cellulose. The key is to integrate the pieces into an economically competitive process and commercialize it. -- Joel Cherry, Novozymes
Ethanol 2012 Study - Facing the Future June 2007
The Hale Group, Ltd. and its affiliates have published a multi-client study titled Ethanol 2012 Study. This report is designed to define the key forces that will impact the U.S. ethanol industry during the next five years and to develop appropriate competitive strategies. The Ethanol 2012 Study encompasses the leading experts from the agricultural, petroleum, public policy and technology sectors with a tight focus on the U.S. ethanol market.
Breaking the Biological Barriers to Cellulosic Ethanol
A DOE research roadmap resulting from the Biomass to Biofuels Workshop, December 2005, Rockville, Maryland. The 200-page scientific “roadmap” cites recent advances in biotechnology that have made cost-effective production of ethanol from cellulose, or inedible plant fiber, an attainable goal. The report outlines a detailed research plan for developing new technologies to transform cellulosic ethanol—a renewable, cleaner-burning, and carbon-neutral alternative to gasoline—into an economically viable transportation fuel.
Cellulosic Ethanol: A Greener Alternative
Creating Cellulosic Ethanol: Spinning Straw into Fuel
The Promise of Cellulosic Ethanol
Cellulosic Ethanol Fact Sheet
Growing Energy: How Biofuels Can Help End America's Oil Dependence
An in-depth study by the National Resources Defense Council in 2004. The report calls for $2 billion in funding for cellulosic biofuels over the next ten years, with $1.1 billion directed at research, development and demonstration projects and the remaining $800 million slated for the deployment of biorefineries.
Spain to Open World's First Cellulosic Ethanol Plant
Opening of the world's first commercial cellulosic ethanol plant is slated for this fall in northern Spain, even though costs of producing alcohol fuel via the emerging technology are still estimated to be about 50%-100% higher than that for plants which use grain as a feedstock. The wheat straw to ethanol plant is operated by Abengoa, the largest ethanol producer in Europe, the second largest in the world, and operator of a research and development division in St. Louis, Missouri.
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