U. S. Advanced Bio-Fuels Frequently Asked Questions (FAQ’s)
The road to energy independence is littered with failed projects, often causing lenders and financiers to be skeptical of the technology and risks associated with biofuel projects. To mitigate these risks, U.S. Advanced Bio-Fuels assembled a professional team with unparalleled expertise in the field. That team is implementing a technology that has been proven, supported, and employed by a centuries-old engineering firm that can demonstrate the technology’s long-term dependability and capabilities. U.S Advanced Bio-Fuels provides the following responses to common questions and concerns, demonstrating how U.S. Advanced Bio-Fuels has mitigated the risk of its projects while maximizing successful outcomes for investors and end-users.
1. Is your technology in the Bio-Fuel industry proven?
U.S. Advanced Bio-Fuels selected one of the largest technology and industrial conglomerates in the world to serve as the Engineering, Procurement and Construction provider (EPC). Our EPC employs 156,000 people worldwide with an annual turnover of approximately $40 billion (EUR), and has designed, built and put into successful operation over 100 gasifiers around the globe, and is considered as a worldwide leader in this field. The EPC implements U.S. Advanced Bio-Fuels two core technologies to convert biomass to liquid fuels. First, biomass is converted to synthesis gas by way of a gasification process. Second, the synthesis gas is converted downstream to liquid fuels by way of a Fischer-Tropsch synthesis. Each of these two steps has been used and commercially proven worldwide for many decades.
2. What kind of guarantees are there that the technology will work?
The EPC will act as the prime contractor taking responsibility for each project. From feedstock into product out, the EPC will oversee the entire process chain. By combining both the technology and the engineering, procurement, and construction, the EPC improves the upside while mitigating risk. As proof of confidence in the technology, the EPC offers a Performance Guarantee, further mitigating risk for cautious lenders and financiers. Details of the guarantee are available upon request.
3. How does the Performance Guarantee protect a lender/finance company if the technology does not meet expectations?
All guaranteed plant parameters will be offered on a minimum Performance Guarantee basis. Should any of the Performance Guarantee values not be met by the EPC, then the EPC will pay liquidated damages to U.S. Advanced Bio-Fuels. However, should the minimum Performance Guarantee values not be met, the EPC is obliged to improve the plant until the plant meets the minimum Performance Guarantee values. Based on this comprehensive set of guarantees, the plant will not perform below the minimum Performance Guarantee values. The EPC either owns the technology or has access to any required third-party technology required to deliver a facility capable of achieving the minimum Performance Guarantee values.
4. What happens to the Performance Guarantee once the EPC passes off the Project to the O&M for the long-term operation and maintenance of the Project?
U.S. Advanced Bio-Fuels contracted with one of the premier process Operations and Maintenance (O&M) providers in the world. By combining the performance coverage of the EPC on the one hand, and the O&M on the other, we now offer Project Guarantees and wraps never before offered. The EPC and the O&M collaborated to provide industry-leading contract terms, and this language is available to lenders and financiers directly from the EPC and O&M. This reflects unprecedented cooperation between the EPC and O&M in the renewable fuels industry. The intent of this approach is to easily satisfy lenders and financiers performing their due diligence efforts by backstopping the project with a collaborative interface with two industry giants.
5. How can you be assured that the technology, construction design, feedstock and off-take agreements are valid, independently verified and financially feasible?
U.S. Advanced Bio-Fuels has received written confirmation from a world-class independent engineering firm that they will serve as our Project’s Owner’s Engineer and Project Manager. This leading Technical Advisory Company (“TAC”) is headquartered in Denver, CO. The TAC will provide owner’s engineering, project management consulting, and due diligence consulting services to help U.S. Advanced Bio-Fuels create a traditionally financeable project. TAC agreed to accompany U.S. Advanced Bio-Fuels team members on calls where the firm is initiating interest with project off-takers and feedstock companies, land providers and government entities. TAC has an incredible and long-standing working relationship with the O&M. TAC’s mission includes helping companies meet the needs of the lenders and financiers, and TAC has helped many world-class companies obtain financing. TAC is currently poised to assist the U. S. Advanced Bio-Fuels team in Hawaii and Seattle. The viability of our projects is further verified by our world-class legal partner, Perkins Coie LLP one of the most recognized law firms in the energy sector.
6. U. S. Advanced Bio-Fuels has little or no experience building or managing the development of these types of Projects. How do we know you can perform?
The team assembled by U.S. Advanced Bio-Fuels, and its combined breadth and length of experience, speaks loudly of the U.S. Advanced Bio-Fuels prospects in the bio-fuel industry. TAC has been involved with the development of hundreds of projects, including multiple bio-fuel, gasification and biomass projects, utilizing a wide variety of available industry technologies. The TAC will be closely involved with all of our projects. U.S. Advanced Bio-Fuels has strategically partnered with industry-leading companies—each of which is unequivocally recognized as industry experts in their respective fields—to provide essential support and expertise.
7. Exactly how many Projects can the EPC and O&M handle?
A conservative approach will be taken to validate each project. The team will be required to underwrite each project on a case by case basis. Each member of U.S. Advanced Bio-Fuel’s Project Development Team has experience executing multiple projects concurrently, and the O&M regularly undertakes to support a dozen or more green-field projects and/or project transitions at any given time.
8. What about the things that U.S. Advanced Bio-Fuels does not control, like feedstock suppliers, off-take contracts, and land acquisition/control?
Prior to the project’s preliminary FEED3 Studies, U.S. Advanced will have a signed letter of intent that will culminate a contract prior to construction funding. Additionally, during the FEED3 Study, letters of intent are converted into formal, legal contracts with the partner organization solidifying what was committed to in the letter of intent and assuring all necessary elements are contractually in place.
9. Is the TEAM of U.S Advanced Bio-Fuels complete?
U.S. Advanced Bio-Fuel’s team enhanced its team’s qualifications with the addition of key professional whose expertise is Renewable Jet and Diesel fuels.: This fuels expert is also a leading sales expert in renewable energy credits and carbon credit sales. We foresee many successful projects being developed and funded by this world-class team.
10. The U. S. Advanced Bio-Fuels Team consist of:
- Owner’s Engineer, Technical Advisor & Project Management Consultant
- Perkins Coie LLP