Vous êtes sur la page 1sur 50

All rights reserved.

No part of this PROJECT may be republished in any form whatsoever, electronic, or mechanical without expressed written consent from the promoter, the company Etanolsa S.A., of Guayaquil, Ecuador, finangallardohotmail.com. Disclaimer And/Or Legal Notices The information presented herein represents valuable and proprietary information for developing biofuel projects in Ecuador only under the patronage of Etanolsa S.A., Wellington Gallardo, President. Etanolsa S.A. is an Ecuadorian corporation exclusively engaged in developing agroindustrial projects to convert carbohydrates into ethanol and biodiesel in Ecuador, using sugarcane, cassava roots, agriculture waste of banana crops, and Jatropha Curcas as feedstock. The production and use of fuels using vegetable oils has been with man since the days of Rudolph Diesel when he first demonstrated biodiesel derived from peanut oil. Todays world of Global Warming and Climate Change, high fuel prices, at this moment the barrel of oil is over US$100.00 dollars, and uncertain political realities has created a new and intensified interest in Biofuels. Etanolsa S.A. has been actively working in gathering fertile lands to develop the cultivation of jatropha curcas under the best geographically conditions, mainly in the Peninsula of Santa Elena, and also in the near future operating and maintaining jatropha nurseries and jatropha plantations throughout the Peninsula of Santa Elena. Upon maturity of the Jatropha seedlings and a successful harvest of the oil bearing seeds, we will process and refine the oil to produce biodiesel that can be used pure or mixed to create a biodiesel blend. The Jatropha oil and Jatropha biodiesel can be used in a number of applications ranging from automotive fuel to electric generation using a diesel generator. Auto manufacturers like Mercedes and Daimler-Chrysler are already trial running cars on Jatropha biodiesel with great results. Aside from our large scale activities Etanolsa S.A. is actively involved in a number of local community based micro generation projects in the intercrop plantation. By enabling small local communities to get involved in various stages of the biodiesel process we are assisting them in growing towards economical independence and bringing the freedom and safety of a reliable power supply to areas that previously had none. We are ready to ensure sustained use of water supplies, land and natural resources, the development of biofuels must be planned, managed and maintained. Ecosystems and Rainforests through out the world, that are being destroyed for the sake of biofuels, must be stopped. Other major considerations are land competition for food vs. biofuel production, considerations on habitat destruction and animal species, availability of water, pollution of lands with fertilizers which can lead to soil erosion, safety of people who harvest phytoproducts for biofuel production and issues of developing large massive plants instead of small localized plants near the crops that will be used to manufacture biofuels. FIGHTING DESERTIFICATION & CREATING WEALTH IN THE PENINSULA OF SANTA ELENA

Jatropha curcas is a tough perennial tree could survive even in the desert, and could actually stabilize soil and combat desertification, at the same time as its beans could be refined for diesel fuel. In Ecuador by employing and developing this cultivation project seems to be hopeful momentum towards increasing use of biofuels worldwide and replacing the traditional derivative fossil diesel. The selected area of the Peninsula of Santa Elena has been devastating by high level of deforestation during the last 50 years. Over 60% of The Peninsula of Santa Elenas land has the right climate for growing Jatropha Precisely in our JC cultivation project It is in the field of Bio Diesel fuel our main focus, however, that Jatrophas properties are the most exciting. At same power output, Jatropha curcas oil specific consumption and efficiencies are higher than those of diesel fuel. International Tests conducted show that out of these various vegetable oils including copra, palm, groundnut, cottonseed, rapeseed, soya and sunflower - the lowest exhaust gas emissions were obtained with copra and Jatropha Curcas crude oil. CHALLENGES TO JATROPHAS COMMERCIAL VIABILITY There are still some inherent problems with Jatropha and research work is still required. We are learning more and more about the properties of Jatropha. These potential problems include: 1) Jatropha oil is hydroscopic - absorbs water and needs nitrogen blanketing on steel tanks. One issue that is quite clear is because Jatropha is high in acid, it has the tendency to degrade quickly, particularly if not handled properly through the supply chain. This will be well treated in our project 2) Right from the time of expelling, the oil needs to be kept in storage conditions that prevent undue degradation. Exposure to air and moisture must be minimized - hence the need for nitrogen blanketing on the tanks. Our technology will be implemented to prevent degradation. 3) The range of fatty acids present in the various seeds will differ but the oil and biodiesel that is produced must be acceptable. However, this assumes that that oil is fully

degummed. The degumming may well be more of a problem than making biodiesel. Our technological contractors are fully specialized to overcome this important issue. 4) Seeds degrade as soon as they are picked and so careful storage and handling is required. In the warm humid atmosphere in countries the degradation of seeds can be rapid. Even in the U.K. seed storage is a problem. The free fatty acid must not increase above 2% according to our expertise. Alternative feedstock in our project The emerging industry worldwide is facing a lack of feedstock supplies and rising crude palm oil /soya oil prices and also the debate of crops for food versus fuel and needs initiatives in crop cultivation technologies and competitive sourcing of appropriate feedstock - all of which can alter the biofuel economics. As such the greatest challenges to the widespread deployment and use of biofuels is developing a dedicated energy crops that are cost-effective, easy to sustain and can produce greater yields. JC cultivation as energy crop that produces biofuels and holds particular promise for sustainable development and a sustainable environment, Jatropha has been selected as the one and other intercropping food crops. Sustainability Jatropha cultivation is a valuable multi-purpose crop to alleviate soil degradation, desertification and deforestation, which can be used for bio-energy to replace petro-diesel, for soap production and climatic protection, and hence deserves specific attention Jatropha can help to increase rural incomes, self-sustainability and alleviate poverty for women, elderly, men, rural communities, small farmers and finally large farmers. It can as well help to increase income from plantations and agro-industries. There are various trees that are suitable for bio-diesel production. Out of all these trees, Jatropha must be regarded as a sure inclusion and the foundation around which a good plan can be built if for nothing but its pure hardiness and stress handling ability. It is just a tree that has enough credentials. That is why many developing countries has been nominated JC cultivation as ideal plant for biodiesel. Carbon Savings Biodiesel produced from jatropha is one of the most promising solutions for tackling the growing carbon emissions from transport. Breaking the cycle of poverty Consider that oil priced is too high per barrel has had a disproportionate impact on the poorest countries, 38 of which are net importers and 25 of which import all of their oil; Developing countries consume roughly twice as much oil per dollar of GDP as the United States

All the while, the high cost and Inaccessibility of fossil fuels, leaves approximately 2 billion people worldwide without reliable energy sources, without refrigeration, basic communication, heat, or even light. For developing countries, then, climate change and worlds energy policies are a source of oppression, a source of sickness and a source of human suffering. Since the two-thirds of the people in the developing world who derive their incomes from agriculture and Jatropha based biodiesel as the Santa Elena project has enormous potential to change their situation for the better and poverty can be broken by Jatropha Cultivation as this dedicated crop has a huge potential for replication world -wide, improving the livelihood of many more. In our project more than 20,000 families will employed for all stages of JC cultivation including into its conversion of Biodiesel to be marketed domestically and worldwide and other derivative sub-products will an enormous impact on benefits of all our people in the Coastal Region of Ecuador. At the community level, farmers that produce dedicated energy crops can grow their incomes and grow their own supply of affordable and reliable energy backed by our international project by means of investing US$200 Millions per Biofuel plant and 15,000 hectares of fertile lands along the Peninsula of Santa Elena. Our project at regional level, producing more biofuels will generate new industries, new technologies, new jobs and new markets. At the same time, producing more biofuels will reduce energy expenditures and allow our nation to put more of their resources into health, education and other services for their neediest citizens inside our territory, covering more than 50,000 hectares. In our project bio-diesel will be cultivated Ecuador as other developing countries have the potential to be a leading world producer of diesel, but the rural farmers still need to get comfortable with the idea that diesel fuel can be harvested, but they understand one thing very clearly that they can use Jatropha plants as a source of their main earnings to live under very reasonable standard of living as the one offered in our SEA-Santa Elena Agreement with good salaries, and in addition of 15% of participation in the shares of our promoting company. Farmers need to know that there is going to be a good domestic and international market for what we will produce as energy crops. We in Etanolsa S.A.s Task Team - are very keen to build that confidence and promote Jatropha cultivation by assisting in the whole process from planting, buying the seeds for refining and providing the refining technology to enable growers, workers and employees to make our own biodiesel. Weve been privileged to represent Etanolsa as the Task Team, promoting sustainable farming for biodiesel production and looking for international research findings and on-hand field experiences in respect of various technical, agronomical/silvicultural aspects of plantations of Jatropha and we will contract the best expert companies that have resulted in significant improvements in knowledge and technical background related to Productivity, profitability and sustainability of commercial production of Jatropha oil crop worldwide. Our plant will be cultivating these energy-producing plants, processing them and finally producing biodiesel, we are creating new sources of income for the rural farmers. Etanolsa

S.A. the projects promoter Task Team is happy and proudly presents its commitment to exploring, developing and establishing the correct process, procedures and systems for growing, crushing refining and use of Bio Diesel from seed oil, Jatropha curcas in particular under the respective international off take contracts. We will contract the best companies specialized in each stage of the process who are fully equipped with Technical knowledge and plant science expertise, process engineering and operational expertise to plan, design and Create Fuel Farms; deploy and commission Nonfood vegetable oil refining and design and construct biodiesel plants Jatropha plant - Biodiesel and so much more The seeds of the Jatropha contain high percentages (30%-35%) of oil, which can be extracted easily for further processing (transesterification) and refinement. This processed oil can then be used in diesel engines after minor modifications. To avoid engine modifications the bio-diesel can also be blended with convention-al diesel. On average, each mature tree produces about four kilograms of seed per year. The byproducts of the bio-diesel processing plant are nitrogen-rich press cake and glycerol, which are said to have good commercial value as fertilizer and as a base for soap and cosmetics respectively. The leaves, root and bark could also have potential for numerous other industrial and pharmaceutical uses Because of its growing requirements this tree could easily be growing in the south, especially the south west It was learned that three kilos of jatropha seeds can produce one liter of bio-diesel fuel. It reportedly can also produce oil from which ethanol, a gasoline additive, can be derived. is seen by many to be the perfect biodiesel crop. It can be grown in very poor soils actually generating top soil as it goes, is drought and pest resilient, and it has seeds with up to 40% oil content. Here are some facts and figures about Jatropha relating to its growth as an oil product:- Jatropha grows well on low fertility soils however increased yields can be obtained using a fertilizer containing small amounts of magnesium, sulphur, and calcium. - Jatropha can be intercropped with many cash crops such as coffee, sugar, fruits and vegetables with the Jatropha offering both fertilizer and protection against livestock. - Jatropha needs at least 250mm of rain annually to thrive however it can survive three years of drought by dropping its leaves. - Jatropha is excellent at preventing soil erosion, and the leaves it drops act as a wonderful soil enriching mulch. - Jatropha prefers alkaline soils. - The cost of 2500 jatropha saplings (enough for one hectare) in Ecuador is around or equivalent to US$100 - The cost of 1kg of jatropha seeds in Ecuador is around or equivalent to - Each jatropha seedling should be given a 2m x 2m area to grow into. - 20% of seedlings planted will not survive. - Jatropha seedlings yield seeds in the first year after plantation. -After the first five years, the typical annual yield of a jatropha tree is 3.5kg of beans - Jatropha trees are productive for up to 40-50 years in Ecuador. - 2,500 trees can be planted per hectare. - 1 hectare should yield around 24 tons of seeds per year with two crops. - The oil pressed from 4kg of seeds is needed to make 1 liter of biodiesel. 5

- 91%+ of the oil can be extracted with cold pressing. - 1 hectare should yield around 2.2-2.8 tons of oil. - Press cake (seedcake) is left after the oil is pressed from the seeds. This can be composted and used as a high grade nitrogen rich organic fertilizer (green manure). The remaining oil can be used to make skin friendly soap. One job is created for each 4 hectares of jatropha plantation. - The average Ecuadorian agricultural worker earns less than $200 per month, but in our project they will earn more than US$500 per month. - Biodiesel costs around US$0.90 per gallon to grow and refine in Ecuador. - Glycerol, a biproduct of biodiesel refinement, can be sold in India for around US$2,000 per ton. - One hectare of jatropha plantation yields US$5,800/ year in Ecuador. The following stats come from D1 Oils - the UKs biggest biodiesel company : - Crushing 1 ton of Jatropha seeds costs around $40. - 1 ton of (the leftovers after pressing) can be sold for $100. - The transport costs of shipping 1 ton of jatropha from Ecuador to Pacific Rim of USA is US$________. - Filtered jatropha oil can be used as is in many diesel vehicles (as SVO) with only small modifications required to the engine. - Jatropha oil can be used as a kerosene substitute for heating and lamps. - Jatropha oil burns with a clear smokeless flame About Jatropha Curcas Jatropha Curcas is a non edible oil crop predominately used to produce bio-diesel. In addition to bio-diesel production, the by-product of Jatropha Curcas transesterification process can be used to make a wide range of products including high quality paper, energy pellets, soap, cosmetics, toothpaste, embalming fluid, pipe joint cement, cough medicine and as a moistening agent in tobacco. The Jatropha Curcas seed cake which is the waste by-product of the bio-diesel transesterification process can be used as a rich organic fertilizer. Jatropha Curcas grows best on well drained soils with good aeration but is well adapted to marginal soils with low nutrient content. Jatropha Curcas grows well with more than 250mm rainfall per year and it can withstand long periods of drought. The plant sheds its leaves during a prolonged dry season. Jatropha Curcas prefers temperatures averaging 20-28 degrees Celsius (68-85 degrees Farenheit). It can, however, withstand a very light frost which causes it to lose all its leaves and may produce a sharp decline in seed yield. One ton of Jatropha Curcas seeds will produce up to 150 gallons of bio-diesel with proper management.

Recommended planting rates of Jatropha Curcas are 2,000 / 2,500 plants per hectare (2.5 acres) One person can professionally plant, manage and harvest 5-8 hectares of Jatropha Curcas. 30kg of Jatropha Curcas fruit can be harvested per person, per hour. Jatropha Curcas oil volume produced depends on: Production capacity (genetics) of the plants The moisture level of the soil The nutrient level of the soil Stage of ripening at harvest Quality of processing and refining equipment Quality of plantation management, particularly pruning methods

Jatropha Curcas Seeds & Seedlings Our Superior high yielding Jatropha Curcas seeds and seedlings will: Reach first harvest within 7 months with full production in their 4 th year Have a life-span of 50 years, while producing seed for up to 40 years Be freshly harvested and professionally packed & shipped Exceed guaranteed 90% germination rate Produce fruit with high oil content (60%) - far exceeding industry average Have selected genetics from plants that have produced over 10 Tonnes of Oil per Hectare, per Year. (10 - 15kgs per tree at maturity)

Projected growth rates of our high yielding Jatropha Curcas seeds With correct growing procedures, soil nutrient and adequate moisture our seeds will achieve the following yields planted at 2,500 plants/Ha : Year 1 - 3kg/tree Year 2 - 6kg/tree Year 3 - 9kg/tree Year 4 - 10-12kg/tree Year 5 - 10-15kg/tree

Jatropha Curcas Propagation and Cultivation : The advantage of Jatropha Curcas seeds and seedlings over Jatropha curcas cuttings

Jatropha Curcas grows readily from seeds or cuttings. However trees propagated from cuttings have a shorter productive lifespan and lower drought/disease resistance than plants propagated from seed. Also, Jatropha Curcas trees produced from cuttings do not produce true taproots. Instead, they produce pseudo-taproots (surface roots) that may penetrate much less than half the depth of soil as taproots produced on trees grown from seed. Note: This years cold weather in China completely killed all Jatropha Curcas plants propagated from cuttings. Only those that were propagated from seeds with a true tap root survived the frost. Although this will never happen in the Coastal region of Ecuador, because our coldest temperature is 12 degrees Celsius due to our geographical position with two season a year: winter and summer (Rainy and Dry).

Achieving Outstanding Jatropha Curcas production Jatropoha Curcas plants inoculated with MYCORRHIZAE will likely survive stressful conditions and give higher yields since the Funghi increases the volume of roots hence increasing drought tolerance of plants by facilitating the transport of moisture to and within the root system. The uptake of other nutrients essential for plant growth is also facilitated by mycorrhizae, and it has the ability to convert normally unavailable forms of Phosphorous to forms available for plant uptake. Jatropha Biodiesel plant based biofuel from seeds. The Jatropha Curcas is a drought resistant oleaginous bushy shrub/tree belongs to the family of Euphorbiaceae and its oily seeds can produce 510 times of oil that is got from the common vegetable oil sources like soy bean and corn. One hectare of Jatropha plantation can produce around 500 gallons of biodiesel per year from its physic nuts along with more than 3,500 kilograms of waste biomass. Hectares Oil Gallons Waste Kilos 1 500 1,000 500,000 15,000 60,000

75,000,000 300,000,000

Biomass 3,500 3,500,000 52,500,000 210,000,000

Jatropha Curcas tropical crop with minimal water source.

The scientific name of Jatropha Curcas is Jatropha Curcas L and its origin is believed to be Central America, which currently found in huge densities in the Asian and African countries. Physically, Jatropha Curcas grows like a small tree or shrub with 2 8 meters high and has large green leaves with three to five lobes. Jatropha Curcas is a long term crop, which starts providing its effective harvest after 18 24 months depending upon the soil and the climatic conditions. The Jatropha Curcas plant grows like a small tree or shrub and has a long lifetime of 40-50 years. The plantation can be grown in waste lands and requires a minimum maintenance and when compared to other crops. The plant doesnt take much water to survive and requires minimal of water source equivalent to 250 mm of annual rainfall, which enables us to grow jatropha curcas plantations marginal land or even in arid regions, where other common plantation crops cannot be grown. Jatropha curcas is grows well in tropical and subtropical climatic conditions. Even when Jatropha adapts with lower temperatures it cannot withstand a frost and grows well at 20-32 deg mean annual temperature and its ideal altitude ranges from 0 to 500 m. Jatropha Oil to Biodiesel by the process of transesterification. The following chart shows the process of converting the jatropha oil into biodiesel:

Advantages of Jatropha as a promising biofuel crop. Jatropha Curcas needs very less amount of water for survival - only about 10 inches (250 mm) of rainfall per year - thus can be grown in arid regions and will grow well on marginal lands. Once grown, it has a long life, about 40-50 years and needs very minimal maintenance when compared to other crops. It can stop land degradation and reverse deforestation. Intercropping can be done with various food crops and wont compete. Biproducts of Jatropha additional products from the crop. The efficiency and profitability of the jatropha curcas bio-fuel industry, increases with the commercial usage of by-products like jatropha cakes and glycerol generated during the process of oil extraction. The Jatropha cake left after oil extraction is an excellent organic fertilizer and can also be burnt for power generation.. These cakes contain proteins and carbohydrates as major constituents and several bioactive compounds as minor constituents. There is a lot of potential to use these cakes for production of biogas, producer gas, briquettes and several products like surfactants and lubricants. The by-product glycerol can be used for production of Propylene Glycol, which can be used for making unsaturated polyster resins, poly ether polyols, functional fluids, cosmetics and toiletries flavor. Propanediol produced from glycerol has a number of applications in laminates, composites novel polysters solvents, and special polymers. Liquid phase hydrogenolysis of glycerol can result in the formation of propylene glycol and ethylene glycol for manufacture of polyster fibre and synthetic cloth. Jatropha Plantation tomorrows oil fields. Jatropha Curcas is hardy drought resistant and grows well in tropical and subtropical regions in a band around the earth between latitudes 30 degrees north and south of the Equator. Jatropha Curcas Trees have a lifespan of up to 40-50 years. Jatropha Curcas grows on a wide range of land types, including non-arable, marginal and waste land, and need not compete with vital food crops for good agricultural land. Jatropha can be intercropped with various crops including vegetables, tubers, medicinal plants. The first stage to establish Jatropha Cultivation System will be to buy the necessary tonnage of seeds available in bulk quantities from the international market to fit our needs for our large scale projects to install and construct 5 biofefineries to be develop in the Coastal Region of Ecuador. Biodiesel Unit oil extraction and conversion machinery.

10

The biodiesel unit consists of an expeller and a transesterifier reactor. The oil is extracted from the jatropha curcas seeds with the help of an oil expeller and then converted into biodiesel with the help of a chemical process called transesterification, which can be then blended or directly used in diesel engines. Several automotive companies have found their vehicles successively running over the pure biodiesel. Biodiesel unit with the expeller and the transesterifier are available with various processing capacities. If there are new machineries that need biodiesel with special specifications unit, you can contact us with your processing requirements in terms of liters/day Jatropha Oil Fields tomorrows oil source. With apparent shortcomings of other renewable fuels sources, the enthusiasm for initiating todays jatropha curcas plantations which will be tomorrows oil fields have increased among the large and small scale farmers which can also make use poor lands with minimal water sources. Analysis of the bioenergy market suggests that jatropha, which can be grown in variable conditions with little water or fertilizer, could be used to produce a barrel of fuel for around $43, less than the cost of sugar cane-based ethanol ($45 per barrel) or corn-based ethanol ($83 per barrel). Further, because jatropha isnt edible and grows on land unsuitable for foods crops, its expansion doesnt compete with traditional food production. Unlike soybeans, canola and many other agricultural sources of biodiesel, Jatropha can be cultivated on arid and semi arid non-agricultural land. This means growing Jatropha never has to compete with growing food. Also, on a per acre basis ,Jatropha can yield up to 10 times the amount of oil as other sources of biodiesel. Finally, Jatropha is a perennial, lasting up to 50 years without replanting. The byproducts like jatropha curcas cake (portion of the seed left over after extraction of the seeds oil) is full of nitrogen compounds making it an excellent organic fertilizer. After 4 or 5 years of treatment with this cake the soil of this originally non-agricultural land will be suitable for planting food crops or trees for reforestation to help considerable agriculture in Ecuador. Jatropha in Rural creating new opportunities. Our Jatropha curcas plantation systems have the ability to lift many people from poverty to financial independence, from despair to respect and unemployment to business owners and partners in our project to be developed in the Peninsula of Santa Elena. Our project will help and increase in a significant way Ecuadors economic development and in the energy demand. It is a real matter that conventional energy sources are the major cause of climate change, leads to understanding that clean renewable energy technologies are to be widely introduced. Thus enables us SEA-The Santa Elena Agreement - to utilize the large tracts of cheap barren land, large and inexpensive rural workforce to develop alternative energy options. A real alternative for transportation and energy production, which benefits

11

four main aspects of development and secure a sustainable way of life for thousands of people in the Coastal Region of Ecuador. Jatropha Curcas tropical crop with minimal water source. Jatropha is bush that grows in the warm regions of the world as it is sensitive to colder climates. Once its planted it grows and produces nuts that contain oil within a few years, and produces these annually for up to 50 years. Jatropha has been grown in developing countries for many years. In fact, it was distributed by Portuguese sailors from Mexico and South America over a hundred years ago to places such as India, Africa, and South East Asia. Its been used locally for production of oil that was used in local village based industries for soap production. Since the plants are toxic they have also been used to plant hedges and to keep animals out of areas of land. Jatropha Machinery oil extraction and conversion. We are going to use the most efficient, reliable and durable expeller available in the international markets. These large oil expeller will be used to crush jatropha curcas seeds in single pressing operation whereas it is used as final press for other seeds/ nuts up to 500 tons in an hour with the help of the electrical motor. We will also count with the best transesterification machineries that is used convert Jatropha oil to biodiesel that is viable for industrial use in our project. Its oily seeds can produce 510 times of oil that is got from the common vegetable oil sources like soy bean and corn. One hectare of Jatropha plantation can produce around 500 gallons of biodiesel per year from its physic nuts along with more than 3,500 kilograms of waste biomass. Hectares Oil Gallons Waste Biomass Kilos 1 500 1.000 500.000 10.000 5,000,000 50,000 25,000,000

3.500 3,500,000 35,000,000 175,000,000

Biodiesel from vegetable oils alternate to fossil fuels. Vegetable oils and their derivatives (especially methyl esters), commonly referred to as biodiesel are prominent candidates as alternative diesel fuels. They have advanced from being purely experimental fuels to initial stages of commercialization. They are technically competitive with or offer technical advantages compared to conventional diesel fuel. Besides being a renewable and domestic resource, biodiesel reduces most emissions while engine performance and fuel economy are nearly identical compared to conventional fuels. Pure Biodiesel is a clean burning fuel which runs in any unmodified diesel engine. This fuel is an environmentally-friendly alternative to the higher emission petroleum diesel used in large transport vehicles and some cars and trucks. Our biodiesel will be manufactured at an industrial scale near a production of 80,000 gallons per year per plant for diesel engines that can also be run on unmodified vegetable oil like jatropha curcas bio-diesel.

12

Even we Can extract the Jatropha oil from seeds and directly used in the vehicle. All depends on the engine. If we have a diesel engine with a pre-combustion chamber, we can use the oil directly (after good filtering). If we have a modern diesel engine with direct injection, we have to modify the engine. The best is, to start the engine with diesel, then switch to plant oil (when the engine is hot), and to stop the engine by using diesel again for some few minutes. This means It Can Be Use Direct As Fuel With Mobile, Car, Or Other Diesel Engine Without to be Modified. Yes, definitely Jatropha oil can be used as fuel directly in stationary diesel engines and in mobile ones (cars, trucks, busses), but you have to modify the diesel engine. You can also use Jatropha oil in some diesel engines with a pre-combustion chamber without modification. Further explanation and application with Which Diesel Engine Is Suitable For Bio Diesel Precombustion Chamber Or Direct Injection. Bio-diesel is a chemically modified plant oil. It behaves like diesel and can be used in any diesel engine (DI or pre-combustion chamber) directly. Since bio-diesel is a strong organic solvent, it attacks joints and tubes from organic material (plastic, rubber). So you have to make sure, that your engine has bio-diesel proof joints and plastic parts. Then It is sure possible to plant and develop jatropha biodiesel biorefineries in Ecuador in macro scale as is the case of our project under the following conditions: 1. Good land price 2. Economic harvest cost, and processing 3. High-yield compare with other plant. 4. Availability of funds for biodiesel plant investing. 5. High Price for derivative fossil crude oil. Based on the above premises there are excellent chances for this future on green energy such as the biodiesel to be produce in our 5 biorefineries to be installed and established in the Coastal Region of Ecuador. We are sure that there is no obstacles in the plantation of Jatropha system. We visualize a model, where farmers are growing Jatropha, harvesting the seeds and extracting the oil. Then in our final stage converting jathropa oil into biodiesel to be sold domestically and internationally with a sustainable demand that will last for at least 50 years. We are ready to go into the new era of carbohydrates. Prepare by Wellington G. Gallardo, President of Etanolsa S.A., Guayaquil, Ecuador NAME OF PROJECT: SANTA ELENA BIOFUELS PROJECT LEGAL AGREEMENT: SEA-The Santa Elena Agreement TERRITORY: 50,000 SQUARE HECTARES POTENTIAL POPULATION: 20,000 FAMILIES OR APPROXIMATELY 100,000 INHABITANTS LOCATION: PENINSULA OF SANTA ELENA, SANTA ELENA AND GUAYAS PROVINCES, REPUBLIC OF ECUADOR

13

TOTAL INVESTMENT: US$1,460,000,000 MILLIONS DOLLARS, INCLUDING THE CONSTRUCTION OF 20,000 HOUSES CURRENCY: BARTER OR BOND (LABOR CERTIFICATE) AND CREDIT CARD SYSTEM TERM: 25 YEARS After obtaining the funds to develop our project, we see the next stage in the Santa Elena Project, as a spiritual evolution of humanity as forming a Social Community based on cooperation, love and compassion. In some way this is a high ideal of all religions, but especially expressed in Christianity. Love and compassion are the expressions of an opened heart center, and will be the sound base of our new Social Community in the Peninsula of Santa Elena to be established under the Santa Elena Agreement for an industrial enterprises that use their profits and assets for the benefit of the community. Etanolsa S.A. as promoter of the Santa Elena project is a corporation exclusively engaged to develop biofuel plants in the Coastal Region of Ecuador to "combine entrepreneurial spirit with a sense of social purpose to deliver new opportunities and services such as the production of Biofuels where they are most needed for social/economical developing, such as the Peninsula of Santa Elena. Our Coastal Region Entrepreneurship is about creating a successful new biofuel industry with resources that we already have worked very hard during the last 5 years domestically and internationally, so the final result is a product of our own resources. Only our Successful Entrepreneurs Team, through their imagination, energy, talent, knowledge, contacts, and activities, have created new wealth and funds in our societies and communities. We will do this in two ways: By reducing or eliminating existing inefficiencies in our domestic markets and firms into a specific territory first or by bringing specialized new products and problem-solutions to people located in that territory. When a specified group of people agreed under special-different circumstances then create new businesses or firms to exploit inefficiencies or create and sell new and innovative products we call them entrepreneurs and their activities entrepreneurial. First, Inefficiencies arise when it is difficult to remove poorly used resources from where they are currently employed and reapply them in ways that are more useful, and second, when different/selected people have different information, conjectures, or ideas about the future prospects of resources, products, customer needs and preferences, the value chains of industries, and the broad social, economic, political and technological trends. All of them has been and will be considered in developing our biofuels industrial projects in the coastal region of Ecuador. We are offering solutions for these inefficiencies for our people under the Santa Elena Agreement , as the legal tool to bond the people, the land, the technology, financing , the marketers, and a new currency system, as a rich pool of opportunities for the creation of a successful biofuel energy industry in the Coastal Region of Ecuador. We are creative and are constantly looking at the world around us in new ways of biofuel technologies. In our Entrepreneurial creation is the process of carving out a specific new biofuel industry from the raw material such as energetic crops to be developed along the Peninsula of Santa Elena from our own broad social, economic, technological and political trends with the help of our commonly held resources, namely first: fertile lands, talent, imagination, energy, education, time, and contacts local and international. 14

We are in the process to form new entrepreneurial leaders who imagines a future development of biofuel in the Coastal Region of Ecuador and later in other countries in South and Central America within a framework of macro forces and trends, and act to bring the future into existence with a sense of urgency, unconstrained by the limited set of means at their disposal, with commitment and flexibility during the creation process, in order to profit from the kind of journey such the Biofuel Industry in Ecuador. We are working hard in creating entrepreneurial opportunities from international trends and forces, as are the biofuels, much larger than the ones we face directly control in Ecuador. To understand this kind of entrepreneurship, as the Santa Elena Agreement, and become part of it, we have to understand the raw materials of entrepreneurial opportunities (the macro forces), and how our entrepreneurs imagine and crystallize the specific new biofuel industry enhanced by our geographical strategic conditions in Ecuador to produce biofuels at a very competitive cost of production, the way in which the imagined future is created by embodying human aspirations in concrete biofuels products and to be exported to local and international markets, and the actions and forces that dictate which futures are worthwhile and which are not. These are the sound basis to establish a new Social Community with our own rules, doctrine, specialized employment, education, defined territory, identity, financing, and general agreement in using a new currency inside our territory. We are using as a major source of entrepreneurial opportunities, the Santa Elena Biofuels Project, such the emergence of significant changes in social, political, demographic, and economic forces that are largely outside the control of individuals. Economists call these kinds of macro forces exogenous changes because they often occur outside the boundaries of our industrial/business environment and are rarely influenced by them, but not inside our territory. On the contrary, these changes have a profound impact on the industrial/business world because we believe that the era of the carbohydrates just start and the biofuels are the best alternative to replace and gasoline and diesel with a demand good for the next 50 years. Of course, sometimes social and political changes are a result of business practices or cultures (such as globalization), but in most cases, individual firms and enterprises will be influenced by such forces inside our territory because our pre-conceived measures at the forefront of secure electronic payments with the latest encryption, smart credit cards and digital signature inside our territory. These large-scale macro forces give rise such as the biofuel industry with alternativeecological biofuels - to fundamental changes in how we live, where we live, and what we prefer, thus providing numerous opportunities for our entrepreneurs that composed Etanolsa S.A. to create and market new biofuels and services. Indeed, these changes have also provided us opportunities to renew and reinvent these existing ecological biofuels and adapting into the Ecuadorian production and in our society to be commercialized worldwide. Thus, we are ready to follow the corresponding demographic changes that alter the size, average age, structure, composition, employment, educational status, income, and health of the population in the Biofuel Corridor where the first 5 Biorefineries to be established. The Santa Elena Agreement will change the social, political and economic status in its territory The peninsula of Santa Elena - and will have the effect of altering the mindsets and preferences of people: Feminism, environmentalism, globalization, health and

15

fitness, employment, education, urbanization, suburbanization, democratization, affluence, poverty, decreasing crime, and a variety of other social, economic and political movements have fundamentally changed the attitudes of people about what is important and urgent in life and. Whether facts do indeed change or not, their meaning and implications do change for us, especially inside our Biofuel Corridor Territory. The Biofuels products by themselves will impact political and social changes to serve as the necessary ingredients from which lucrative biofuels ideas to generate funds can be hatched for the benefits for all people living inside our territory. Because of these demographic, social, political and economic changes, new needs emerge, or can be induced, in a wide variety of areas in the Coastal Region of Ecuador, including health, education, entertainment, financial security, housing, travel, etc. These changes also alter the relative size of segments and markets for existing products and services as once dominant, and in addition to the production of biofuels products to be exported at a significant scale in a near future. The Santa Elena Agreement will bringing new biofuel products and markets into existence but usually involves an element of downside (partly influenced by limited risk and partly by uncertainty). Indeed, risk and uncertainty provide the opportunity for profit in the first place in developing the Stan Elena Biofuels Project. This opportunity for profit will attract about 20,000 families, representing thousands of people (100,000) towards our entrepreneurship in the Peninsula of Santa Elena. We account with Individuals who are agreed in their perception of downside risks, profit opportunities, and in their aptitudes and capacities to deal with and manage them and to be bonded and become a reality in the Santa Elena Agreement by establishing a new Social Community. We are applying the following principle in the Santa Elena Agreement: All creative endeavors involve a vicious cycle: no product implies no customers; no customers implies no revenue; no revenue implies no cash for investment; no investment implies no legitimacy or credibility; no legitimacy implies no resources; no resources implies no product. While affordable loss principle allows us as entrepreneurs and partners in our corporation: Etanolsa S.A. will try under their best efforts to keep the loss exposure low, a strategy of starting with what we will have to build into the Biofuel Industry is rapidly important for breaking out of the vicious cycle. By using our human capital (talent, education, and knowledge), intellectual capital (creativity, resourcefulness, enthusiasm, and optimism), and social capital (contacts with people in Ecuador and out), fully sufficient new fresh private funds, and ample means of fertile lands; we, as entrepreneurs, are able to leverage the necessary resources required to break out of the vicious cycle without increasing their overall exposure to loss from a failed venture, in addition to a huge demand for alternative/ecological biofuels worldwide that reach over 240,000 Millions of biofuel gallons for the next 50 years. In the entrepreneurship literature, we call the strategy of using commonly available resources to break out of the vicious cycle bootstrapping. Bootstrapping starts with the resources that the entrepreneur already has (rather than the idea or product) and allows the entrepreneur to build up the industry/business gradually, customer by customer, product by product, employee by employee (i.e., pulling yourself up by your bootstraps). It is out of commonly available resources such as ones own human capital, intellectual capital, contracted technology, contracted international marketers,

16

social capital, private fresh finance capital and fertile ample land capital that we have to break the vicious cycle. Construction of a New Social Community The Santa Elena Agreement uses the modern concept of analysis of contemporary social and economic conditions inside the Biofuel Corridor Territory, where the 5 first Biorefineries will be constructed and installed in the coastal region of Ecuador, that highlight the growing importance of knowledge in society, internationalization of the economy through biofuel exports, demographic changes, the fast growing scientific and technical knowledge, the growing competition between countries and the impact of the new information technologies on the nature of work. We are going to adopt and establish the construction of a new social community that will depend to a large extent on our investment in knowledge and our ability to utilize knowledge with the help of the new information and telecommunications technologies, so education is the key factor. We are also awarded that today changes are so rapid that sometimes it is hard to follow the developments. Opportunities to obtain knowledge are greater than ever before. There are three main elements in today's social development that call for rapid change in education, namely, information technology, international co-operation and the utilization of science and technology in the Biofuel Industry to be developed in Coastal Region of Ecuador through the construction and installation of 5 Biorefineries to produce 500 Millions of Biofuels to be marketed domestically and worldwide. It is forecasted that mass production will continue to decline, making room for more differentiated and flexible work organization and higher level of individual autonomy. In the Santa Elena Agreement this means that our economy needs well trained individuals who are open to changes and who have solid knowledge and skill foundation to build on. Those who seek knowledge often inspire others to do the same, because we can only share what we will have in abundance. For that reason, we are contracting the best in world for technology and management, such as BBI International., Salida, Colorado, a world leading company of its kind in the Biofuel Industry worldwide. We need to be ready for the increased competition between nations as the entrepreneurs of the Santa Elena Agreement whose main objective it is the production of biofuels and our work force team will become more mobile in this sense. In order to survive in such competition, language training, the use of information technology, and education on social community and the international system will have to be increased by our own means as one of our best investment inside our territory for all families that will live there. The information technologies will be an integral part of the new Social Community inside our Biofuel Corridor Territory. Technology, however, is not simply a means to predefined ends. It is coming increasingly clear that the digital revolution offers so radically different possibilities from what we have known in the past in education and training that it cannot simply be looked upon as a more efficient way to do the same. An authority on the subject has stated: "Schools will change to become more like museums and

17

playgrounds for children to assemble ideas and socialize with other children all over the world." This kind of education will also become a reality inside our Biofuel Corridor Territory for all children living with their families. Additionally to standard and traditional education, we are going to supplement with the latest technology in the field of digital information and English as a second language. In contrast to the view that the use of computers in education and training will increase the danger of social exclusion, it is maintained that this problem can be tackled to some extent by means of the new technology, given that everyone has access to computer and telecommunication facilities. Even if this sounds somewhat unrealistic today this may become true within not so many years inside our Territory. We should not, though, underestimate the obstacles to the full use of the new information technologies in education and training. Inside our Territory there will be current inflexible structure of educational provision that make it difficult to respond to new demands and evidence indicates that teachers may look at the new technologies as a threat. It is well known that there are strong forces at work in schools that resist change. Teachers, like others, know what they have but not what they will get. In addition, teachers' salaries are in most cases determined with reference to certain teaching arrangements. Changing this basis of teachers' salaries will take time in our Social Community in the Santa Elena Agreement. It should be mentioned here that small language communities are worried about the language factor in educational software and the danger of cultural hegemony. The digital revolution should not only be looked at as an opportunity for all to get more access to individualized information inside our territory but also to provide more information in a diversified manner, stressing the complex mosaic of international culture, where small cultural entities play an important role. In summary about Education inside our Territory, the main characteristics of Our New Social Community will be as follows: 1.- instant information for all individuals living inside our Territory. To be able to use the opportunities this offer a person will be well educated and have technological know-how in many field of action. This requires lifelong learning and an educational system based on high international standards, although promoting national culture and love to our homeland. 2.- The state shall not monopolize education, but decentralization operated by our own Social Community that requires quality standards to be enforced on national and even international level. 3.- Inherent restraints in the school system and good calendar of seminars inside our Territory - must be overcome to make it more flexible. This can not be done without active a participation of good teachers. 4.- We are living at the time in history when traditional teaching methods are being replaced by alternative ones, due to technological brake-through which still is to make the dissemination of knowledge easier than ever before. Common Vision Inside Our Territory, including General Welfare.

18

Our construction program is based on radical principles. Its not about housing certificates to help the poor, which amount to a payoff to wealthy landlords; its about creating housing that is affordable to all inside our Territory. Every one, worker and employee, under the SEA will have a comfortable house with only 15% deduction (US$75.00) from his basic monthly salary. Its not about dealing with the health-care problem with better insurance coverage, which continues the flow of profits to the drug industry, but about promoting real health for all based on ancient medicine principles with selected modern alternative medicine in our chain of SPAs inside our territory, using prevention by obtaining a strong health based in the condition of the internal organs and glands that nourish every function of the body, and it is the bone marrow that nourishes and rejuvenates the organs and glands through the production of blood. In reality, there are methods of absorbing energy into the bones that revives the bone marrow and reverse the effects of aging through the techniques of bone breathing, bone compression, and sexual energy massage, which stimulates the hormonal production that help to prevent osteoporosis. We have to educate all workers and employees in how the bones stabilize or grounding the life of spirit within the human body and have the opportunity the core of our physical body and to learn how to root our spiritual being within that solid physical bone. We are going to work very in a spirit of altruism and achieve it in our territory to be accepted on our own terms, according to the SEA-Santa Elena Agreement accepting our own responsibility to change ourselves and setting a new example for the rest of our nation and the world through our lifes endeavors, then we will find the best way to create an impetus for change. Consequently, our challenge is to develop a society that does not consume more than its fair share of the earths resources, reducing our consumption of non-renewable energy, within a framework of self-reliance.

It is essential that there be a common vision and principles that link us together. In the Santa Elena Agreement we are not looking for a leader to lay out our constructive program, but some form of participatory process is important. The Santa Elena Agreement includes: a synthesis of values, principles, and aspirations created through long work and study with international consultation, serve as a framework for a presentday Constructive Program, with rural communities working on the Santa Elena Biofuels projects they feel are most needed for them in the Peninsula of Santa Elena. Constructive program is more than constructing new things. For us, people in Etanolsa S.A., as promoter of the Santa Elena Biofuels Project that means serious antioppression work, as well as dealing with economic inequalities. Demanding the truth and removing the causes of economic war inside our territory through other components of the constructive program would be a big step toward reducing any violent conflicts and situations. The Santa Elena Agreement will be composed by people to be proactive rather than reactive. We are conscious that It will take a sustained level of organizing to create a new social Community in Santa Elena Province. Our people to be hired to work for the 5 Biorefineries 20,000 families into a Territory of 50,000 hectares, because they are 19

going to be comfortable to work for what we say we want. Yes, they know that It is easier to protest the things we dont like than to build the things we want. The labor contracts will be based on the notion of selective-qualified workers to sign a contract agreeing to respect the principle of the Santa Elena Agreement, whose main idea will be useful to the Santa Elena Agreement, and allow to participate of all benefits. Identity documents with state-of-theart digital technology will become key to clearly distinguished from people outside our Territory, but the main element that prevails among others will be Love Santa Elena Agreement and its Territory We are going to provide seminars all year round to educate and convincing people that the introduction of such Code of Ethic and Conduct will produce general welfare and together with the application of biometrics will keep all transactions secure and are in their best interest towards enforcing security in our Territory. Where we will work and live and by all means to use biometrics in receiving all benefits such as: food, clothing, medicines, housing, entertainments, educational materials, etc. from commercial malls and supermarkets to be located inside our territory to provide all necessary things to live a comfortable standard of living for our workers and employees to be contracted under the Santa Elena Agreement. Only good security provide safe places in the world to live, as well as a fertile ground for establishing, assuring, and developing good businesses and industries, with economy to be more prosperous everyday. Effective identity management, on one hand, a tool to fight against the growing tide of identity theft, a significant threat to both homeland security and financial security for workers and employees inside our Territory. Another strategic goal of our ID schemes is to provide of a range of services to our labors and workers, but also entities such as banks, hospitals, supermarkets, department stores, through multiple programs to be established inside our territory. We need and use accurately identity those requesting a service inside our territory to provide our benefits for our new Social Community. Of course, as in our Territory the government remains in power, we should implement a new program of biometrics, and will focus on containing the risk and drawbacks without slowing up implementation inside our Territory. The Santa Elena Agreement will create and establish a Department of Information Technology and System (DITS) to take care of the security inside our Territory. To follow The Code of Ethic and Conduct that underlies all activities undertaken for realizing our Management Concept. This Code of Ethic and Conduct is to be observed by all Santa Elena Agreement Group of employees and workers (20,000 thousands). We will identify and manage to solve the problems and issues that arise within the emergently evolving society by fusing our Biometric Technologies (BT) and Information Technology (IT), among others:. (1) Engage in Santa Elena Agreement with all persons concerned inside and contracted inside our Territory. (2) Work with an independent and collaborative mind-set in order to solve problems (3) Challenge courageously, even in the face of difficult issues (4) Act with integrity, fairness, and impartiality, at all times (5) Be responsible for your own decisions and conduct

20

Management concept: The DITS Team Group will contribute to the emergently evolving society of the 21st Century in the SEAs Territory. First and Foremost, Acting with Integrity Creating New Values : We believe that the 21st Century society is an emergently evolving society in which there is a diversity of values held by individuals living inside our Biofuel Corridor Territory, and as these values converge they in turn create new values. We believe that such an emergently evolving society will surely develop into a social Community of Santa Elena that will be more comfortable for our countrymen in the Coastal Region of Ecuador, focusing mainly the Peninsula of Santa Elena, Santa Elena and Guayas Provinces, Ecuador. We are aware that the most important value of the DITS Team lies in our social mission, which consists of our contribution to the development of the emergently evolving society in our Territory. This forms the basis of our Management Concept, which we define as The DITS Team Group will contribute to the emergently evolving society of the 21st Century. Unforeseen phenomena are engendered within the emergently evolving society in the Peninsula of Santa Elena and the rest of Ecuador. Many problems and issues and challenges will face our employees and workers as they respond to these phenomena. DITS will seek to uncover any latent issues by fostering deeper The Santa Elena Agreement (dialogue) in depth with our workers and employees and other members of our society, and thereby offering solutions that make use of the knowledge, experience, skill and know-how that we have cultivated through our biofuel industry, especially our biometric technologies (BT) and information technologies (IT). This is our Solutions industry vision, and it is indicative of the direction we will be taking for our contribution to the creation of an emergently evolving society in the Ecuadorian Territory as a whole. Our SEA Team Group Code of Conduct will create new values premised on sincere conduct The Guiding Principles will establish the standards of behavior for each of our employees and workers as they engage in realizing our Industry Vision. The core concept of our Guiding Principles will be the "dialogue". As we see it, rather than simply meaning to have a conversation, Dialogue means finding out about the issues and dreams of others, and giving careful consideration to finding ways to help resolve those issues and realize those dreams inside our delineated Territory. SEA Management Concept/Vision for the 21st Century and the Group Code of Ethic and Conduct Communication with stakeholders Corporate Governance Compliance with the law and social ethics Information security and personal information protection. Promotion of social responsibility in the supply chain of Biofuel Industry that contributes to the resolution of social issues creating a vibrant workplace (Human resource development, diversity, work/life balance, safety, health and hygiene). Social contribution as a corporate workers and employees Environmental conservation and realizing a sustainable New Social Community (Climate change and global warming prevention, resource recycling, pollution prevention) Matters of Importance to Our Social Community of the Santa Elena Agreement: Communication: SEA will place great emphasis on "Dialogue" with all stakeholders. In fact, Dialogue is at the core of our Guiding Principles, which governs all of the activities

21

we pursue with the goal of realizing our Industry Vision. Engaging in Santa Elena Agreement with our many stakeholders will provide for an early identification of changes in consumer values as well as new issues inside our Territory (50,000 hectares). We, Etanolsa S.A.s entrepreneurs will seek to realize a sustainable society and environment by aggressively challenging these issues in parallel with SEA. We believe that building a relationship of trust with stakeholders by deepening our communication with them and being fully accountable is of the utmost importance to effective in the Santa Elena Agreement. Therefore, we will offer information matching the needs of our stakeholders through a variety of media, and in addition aggressively will seek to create opportunities for exchanges of opinion through conducting surveys and holding Q&A sessions and forums. Disclosure of information to all shareholders and investors : We will form a specialized task force team that will conduct information disclosure according to our Disclosure Policy, so as to ensure timely and accurate disclosure of information to all shareholders and investors based upon transparency, fairness, and continuity. In addition to more than 50 individual meetings a year, we also hold factory tours and strategic technology seminars for our industry, businesses and products with high interest among our shareholders and investors. We compliment this information by producing annual reports in both English and Spanish . We also will establish an Information Disclosure Committee in May 2009, with the goal of ensuring timely and accurate information disclosure. We seek to meet the needs of our overseas investors by conducting information disclosure by means of conference calls and teleconference meetings, as well as through the Internet. We create display panels and illustrations at our general shareholders meetings as a way of introducing our company and our business to all shareholders, so as to deepen their understanding of SEA-Santa Elena Agreement. In addition to providing a basic explanation of the Santa Elena Agreement, the seminars that will provide also advised our workers and employees to look into Etanolsa S.A., approach by thinking about matters such as What is the meaning of our work?, What is the role of the company?, Does that role contribute to the creation of a sustainable new Social Community?, Does the role of that company make sense to me in terms of our own values?, and Will I be able to grow and realize my full potential at our company? when doing their institutional research. The Santa Elenas Implementation of efforts to create an atmosphere full of creativity and energy: (1)Overall maximization through participation by all employees and workers; (2)Work optimization activities for the realization of desired work habits (Work Optimization Management Training for executives, Work Optimization Expert Seminar for employees responsible for advancing work, and for general workers in the fields of Energy Crops). Promotion of Work Accident, Prevention Measures and Risk Assessment, and Worksites in a progressive scale from our starting of operation that by FY20011 we will have to advance to Levels I and II and son on. It will begin to work on health guidelines that include specific exams and specific health insurance guidance. Examination of the system for improved promotion of health and health maintenance plans with centers to be located logistically inside our Territory.

22

Ensuring the safety and quality of our biofuel products and services through realization of an Intelligent society with environmental conservation and the realization of a recycling-oriented society with respect for human dignity and diversity in compliance with the law and societal ethics, as a social contribution as a good corporate citizen contributing to the development of society, ensuring information security with proper disclosure of information to help the realization of a safe and vibrant workplace. FY2012 Targets: We will work in strengthen measures to improve employee awareness of the SEA Group 21st Century Vision, and improve the degree of its understanding by Group employees and workers inside our Territory. Strengthen measures for support of social contribution activities by individual employees, through labor-management cooperation. To maintain and continue steadily with all current types of risk management and other training so as to ensure that corporate ethics efforts retain their meaning, as well to increase their effectiveness. Improve the internal controls required by the Financial Instruments, and conduct strict checking, verification, and evaluation of their application. To promote efforts to create an atmosphere full of creativity and energy. (Create a location for exchanges of opinion, efforts based on Participation By All Employees and workers, etc.). To promote risk reduction efforts for improved safety that includes the goal of a reduction of the number of work accidents. Our real prosperity will be built not on debt but on well remunerate labor force that could be sustainable with real gratify indulgence inside our Territory. This new international financial architecture that back us with funds up to US$1 Billion Dollars will aim to create (1) a new monetary regime or system based on state-of-the-art biometric technology that operates with currency hegemony, (2) Domestic trade relationships that support rather than retard domestic development, and (3) a fair economic environment that promotes incentives inside our territory to promote full employment and rising wages for our labor force. This new financial system should aim at establishing a new financial order that is fair, just, inclusive and orderly and fostering an institutional environment conducive to sound economic development inside our territory. Another dimension of the benefits from this kind of currency to be used inside our territory would be a great improvement in the fund-pocket policies or method to be supplied with all means of fair standard of living, covering at least third-fourth of US$600,00 dollars per month and per worker/employee. The benefits to each Biofuel plants territory from a stable method of currency would be enormous. Because all 20,000 families to be contracted and become link to the Santa Elena Agreement will utilized our Biometric System, in order to obtain all the benefits backed by sink deposit in dollars from international prime banks, so in this manner there would be a common inflation rate and similar interest rates, a considerable increase in trade, productivity and financial integration, all of which would produce a considerable increase in economic growth and well-being. We are introducing a new like-monetary system by means of a royalty for our own use, hoarding of money can be prevented, and to use income by our workers and employees without user fee. This combined with a credit fee the general level of interest can be

23

decreased so that the rate for long term capital assets can be set near zero, because of bank and credit fee, whereas on the other hand the rate of credit interest is set on the free market as it is today. But we have to take care in keeping inflation at exactly 0 %, because there is no money creation in our service system. The main consequence of the new and small royalty monetary system to be used inside our territory - is that the actual incomes from monetary unearned incomes from credits would be transferred to the workers and employees via the Santa Elena Agreement by means of the users and credit fee. This is the price for ensuring the stability of society in the long run. In our new society anyone who wants to "consume" a service has to offer some other service in the system of biofuel plants along our energy crops corridor, as a worker or employee, according to the Santa Elena Agreement. The consumption of the one and the execution of the other service can differ in time, but it makes sense to offer options on future services or works under the SEA-Santa Elena Agreement. Consequently Etanolsa S.A. in cooperation under the Santa Elena Agreement (SEA) as the money holder (US$1 Billion Dollars), will act as a kind of Central Bank, with the following control duties inside our territory: 1) The SEA has to keep the royalty at a level where no hoarding appears. The level of the royalty also has direct influence on the speed of money circulation using digital platform only. 2) The SEA keeps the credit fee at a level so that the interest rate is 0. 3) The SEA keeps the money circulation on a level where inflation is 0. For the following reasons where this is always possible: The level of prices is a result of the quantity equitation P=M.V/Q. The speed V is determined by the royalty. No matter which variations in time occur to V and Q, M can always be chosen in order to keep P on constant level. But the process of control is not to measure speed constantly, but to calculate the money supply (Totaling US$1 Billion Dollars) M which is necessary to keep P constant: the level of prices P is constantly measured. If P increases M is to be reduced, if P decreases M has to be increased. This process makes it possible to keep P at a constant level (= inflation equals 0), just the same way as it is possible to keep car speed constant with the accelerator while observing the speedometer. If the royalty is already at a level where hoarding disappears and there is no more change of the savings curve, and it is also possible to use the royalty as mean of control, because it has direct influence on the speed daily. (Just as it is possible to keep car speed constant either by using the accelerator or using the brakes.) As a conclusion, We are able to say that the means of control : - money supply, royalty, - credit fee, and the target measures with - interest rate = 0, - inflation = 0 In our territory, SEA will guarantee that a house of 70 sq. meters of construction in a lot of land of 250 square meters will be rented by every workers and employees in the SEA at only US$75.00 per month to be deducted from their monthly payment. After 10 years of continues work, every employee and worker will proceed to prepare legal documentation to buy the same house at only US150.00 per month, but to be deducted from the profit of 15% shares to be distributed among all workers and employees. It is not evident that land and construction - comparable to vital goods like air and water - is 24

subject to speculation and not a public good like air and water. The use of land - this is the crucial point - and via profit also the gains of personal initiative, have to be private inside our territory. This subject is so immense that it is a subject to be treated in its own right inside our territory. The introduction of a royalty on bank money is technically no problem. The development of electronic devices will lead to an increase of cashless transfer systems and will ease the introduction of a royalty also to cash money. To enforce this changing of the system we have to understand and realize that there are only winners. The persons and institutions who are able to cause a lack or an excess supply of money, possess a quite unimaginable level of power. To fulfill its function as a medium of exchange, money not only has to exist, but essentially needs to circulate, In our economic system money has the same function as blood for the body of human beings. In order to fulfill all the different functions of life, circulation of the blood must be ensured without interruption. With money it is the same - it necessarily needs to circulate in order to realize full employment. Money keeps circulating in two ways. First, by its original trading function, purchasing goods or services, which is motivated by the necessity of satisfying human needs by using our barter or bond system in addition on the Credit Card system. Second, money keeps circulating by being borrowed, which is motivated by interest. Interest is a "price" for using money, and ensures that unspent money is lent to other persons. In this way, money is not prevented from being circulated because people just hoard it. SEA will place all funds from an international private loan (US$1 Billion Dollars) to back up all commercial transactions to be conducted inside our territory, and a year and a half later when all 5 biorefineries will be in full operation to produce 500 millions gallons of biofuel, an additional US$1 Billion Dollars per year will be added in our cash deposit placed at Prime Commercial Banks. The speed of money circulation is determined by: the incentive to buy goods, which depends on needs and on the inflation rate, the incentive to lend money, influenced by the interest rate money hoarding: if money is not brought into circulation through buying or lending as it happens in our territory, then it is accumulated. SEA will have direct control of inflation that demands direct control of money supply and speed of money circulation, using the system of bonds or barter, in addition to the Credit Card System to buy the basic resources of products and goods to live well inside our territory. Therefore the control of inflation is very practical and real with no deviations of the economic cycle assuring in this sense the employment inside our territory. The money will be managed exclusively by SEA to be used as sink fund to guarantee all purchasing contract to big private institutions who are the providers of all goods and services inside our territory, and consequently that no ownership of money can be established, but naturally the possibility of ownership of credits will remain inside our territory and backed by our sink deposit to be placed in International Prime Banks. A ten percent of participation by part of SEAs workers and employees will be deviated to become part of the project that means to able to get credit from the Projects operations capital under the SEA. Our economy will be based more on abundance, on the idea that there is plenty of everything for everybody. Our economic system in place that promote that an 25

abundance will be created, And this to happen naturally and voluntarily, without a need for an oppressive system that forces our employees and workers to do it like that. The SEA economic system will be built on abundance of good and services inside our territory. The system is driven by the idea that there will be enough to live well, and we have to work and keep protected by all our means for what is there, that is the sound basis for the Santa Elena Agreement. We have worked to get all necessary funds and soon will start from putting all the cumulative resources together and manage them well, so all we live comfortably among workers and employees inside our territory. It is just that our economic system will tell us that we mostly bear these resources, but we have to work fairly because they are just near or close to our reach and reality, and if SEA manage our potential credit well, all workers and employees inside our territory can keep being rewarded with nice stuff, because all of us will own our houses and good and services to live well, or at least for a while we are inside the SEA and working for it. SEA will establish a system in a set of relations that influence our behavior. An economic system that will inherently viable could influence people to behave in generally more sane and enjoyable ways inside our territory. A system based on a fixed quantity of work producing or generating a fixed quantity of money, where would be enough to buy everything we need to live well. A system that allows money to be disburse in tune with value being produced. That is, at the same time as something that is perceived valuable is being created inside our territory, an equivalent amount of money to pay for all mostly needs to be brought into existence. And that money needs to be available for those who need and appreciate the created value. And there should be no future installments due based on that exchange. The best alternative in our economic system it is to use cash money as our last chance inside our territory, but a system of bonds (Labor Certificate) and a Credit Card System where resources are used and shared in a sensible way, combined with intermediary hybrid systems that point in that direction without going to a bank and get a loan to finance a new money system and start using it more and more by our workers and employees. The SEAs whole society will be based more on abundance of goods and services to be contracted through the supplying centers to be located inside our territory, with the real idea that there will be plenty of everything to live well for everybody inside our territory. In place that promote that an abundance will be created naturally and voluntarily under a legal contract, without a need for an oppressive system that forces people to do it like that. Inside our territory our society will be base on abundance and cooperation. With a bare or bond system for exchange of energy from our work in the biofuels plants that embody different ideas that radiates freedom, joy, abundance, play, contribution and spiritual values, as an abundance of resources and start cooperating in utilizing them best. The nature of this planet is abundant with life and resources. Therefore, this situation is going to be reflected inside our territory along our workers and employees who will contribute their work in the biofuel industry. There is plenty of technology to make things easier inside our territory to make biofuels. And then the monetary value of what we will be produced is in part based on the need to recuperate the investments made by Etanolsa S.A. under the SEA as a fund provider/manager, and the costs of the 26

resources that will have to be acquired to put into the products/goods and services. Both activities as opposed to agricultural production, thus industrial production requires that we get stuff from outside and inside our territory that we can build our traded products. Our bare or bond system used as money comes to symbolize what is OWED for the previously used resources that went into what we will paid for. Then our wealth will be based on how much we have produced in the past that we are now being owed for. Information and knowledge do not have mass or weight. Therefore, it can potentially be arrived at instantly inside our territory and they can in principle be replicated any number of times without any use of resources. What becomes important is not what happened before in the past, but what happens AFTER a piece of information is generated or distributed. The value of an idea is in what it will allow us to do, not in the amount of trouble it took to arrive at it, nor in its value as a possession of yours. Our financial institutions are regularly based on the financing of production that then is owed for and needs to be repaid with hard work as an intangible factor with no incremental cost by the proceeds from trading goods and service with the production in the biofuel industry in the first 5 biofuel plants that will convert energy crops into biofuel. It is no longer about being paid for what we will have or what we will spend. It is really important how we could spend the resources inside our territory we have in the most productive way using biometric and state-of-the-art technology. Consequently, Existing information is free and infinitely reproducible so there is no need to ration it and charge money for it or own it. The most valuable services in an information society are to produce/invent something NEW or to show people the way to what is already there. We're talking not only of information, but of adding value TO information. Information itself will be without inherent value in an advanced information society. Getting new information that you need when you need it is what is valuable. Our economy will use a bare or bond system as a currency that doesn't reflect ownership or past work, but that stimulates future creative work that will not attain value before one spends it in a productive way. It would be present or future oriented, rather than oriented towards the past. It is an expression of what one finds use in or one's prediction of future benefits. Information and benefits are potentially unlimited. So, our valued currency system of bare or bond, including a Credit Card System should be able to expand to match the value of the benefits that are experienced inside our territory, rather than the estimated values having to be shrunk to the supply of cash money currency available which will manage by SEA. Our system is proactive, that freely supports a desirable and viable future, rather than money that is reactive, only representing past acts and acquired possessions. Our economic system anybody who creates or perceives value as labor force also creates money, and the money is not a loan to be paid back inside our territory, but a gift to be passed on, according to SEA. Our biofuel project will be finance in reality not by borrowing money inside our territory, but by gaining the trust of others who will believe in our project and voluntarily give money to it as labor force, because they want to see it happen, by producing value that people will feel like rewarding, thereby funding further production of value in the same vein of money that people can freely give without experiencing a personal loss from doing so. In our economic system we transform the money as a sink deposit in international banks into bare or bond system that gains value from being used on something desirable, and that retains no value from being kept inside our territory. 27

In our future society the resources to live well are freely shared, where cooperation and mutual respect will be the norm, and where we could find synergetic strength in our own diversity. Where things will be available for every workers and employees to gradually increase the percentage of our own resources that we could comfortably offer according to our labor force among each other. As a life work contract for 5 years-term revolving which stipulating all details and the amount of quality goods and services available anyone could get from viable industry and businesses that will be growing in our Social Communities in the Peninsula of Santa Elena. Prepare by Wellington Gallardo, Financial Coordinator of Santa Elena Biofuel Project Place: Guayaquil, Ecuador Date, January 21, 2009 This sea- Santa Elena Agreement/Project face that there is no greater challenge to the future generations who will inherit our earth than to resolve the threats of global warming, identified by the consensus of world scientists through the Intergovernmental Panel on Climate Change (IPCC) as presenting unprecedented hazards of rising oceans, flooding and inundation of coastal areas, agricultural disruption, migration of tropical diseases and increased frequency and severity of storms, and period of dryness in the rainy seasons. And no bigger undertaking has ever been attempted by the international community than to devise effective means of implementing the United Nations Framework Convention on Climate Change adopted in 1992 at the Rio Earth Summit to address these threats. This project is also helping to face the challenge that The Intergovernmental Panel on Climate Change (IPCC) identified emissions of carbon dioxide as the chief contributor to global warming. The principal remedy prescribed in Article 2 of the December 1997 Kyoto Protocol for implementation of the Rio Treaty is the adoption of clean energy solutions as ethanol: An energy efficiency enhancement in relevant sectors of national economies; increased use of renewable forms of energy; removal of fiscal incentives and subsidies promoting greenhouse gas emissions; and limitations and reductions of emissions. The burning of fossil fuels is the most significant source of carbon dioxide emissions worldwide, but mainly in the USA that uses 60% of total world fuels that represent over 120,000,000 billion gallons of fuels a year. The principal problem with substitution of clean energy for fossil fuels such as ethanol proposed in this current project that the present use of them is so central to the world's economies, fueling their electric utilities, industry, vehicles, heating and cooling of buildings, and often their household cooking. Developing countries like the Ecuador case have focused on their economic development and the feeding, clothing, housing and health facilities for their populations, often regarding environmental improvements and clean energy as at best secondary priorities. But it is clear that the choice for developing countries is not social development or clean energy - if present growth trends in developing country energy demand continue, world resources quite simply will be inadequate to support their needs either for energy or development.

28

This project is focus to cover a niche in the enormous economic and cultural barriers that must be breached to shift from dependence on fossil fuels to clean energy resources as ethanol. The perceived difficulties of this transformation were seen in the tortuous negotiations of the Kyoto protocols in 1997 and in the small accomplishments achieved in the negotiations of COP 1-5 (Conferences of the Parties). These difficulties were evidenced by the modest goals recommended compared to what the IPCC scientists have identified as the carbon dioxide reductions needed to ameliorate global warming; the lack of mandatory reductions for developing countries (though many have done more than the industrialized countries to address climate change); and the problems, still unresolved, of adopting enforcement mechanisms and of getting the United States, the largest polluter, to ratify the Treaty. This project is in harmony with the task of achieving the Kyoto carbon dioxide reduction goals. A group of private entrepreneurs in Ecuador have decided to achieved and instituted proven technology from USA producing 100 million of ethanol per year/plant as the best measures that have achieved substantial carbon dioxide reductions. We are looking for international funding based on marketing ethanol and a variety of bio-based chemicals byproducts to produce large net revenues by instituting the best efficient processes and using more efficient products. As the world comes to realize the awesome threats and costs of global warming, this projects new initiatives are being taken in both the public and private sectors to address carbon dioxide emissions. What does emerge to assure the demand for this project is clear evidence that global warming can be effectively addressed as developing this project to produce ethanol profitably in both the public and private sectors, offering significant business, export and excellent job opportunities, and that much can be done by accessing internal resources. Utilizing the projects competitive production economics and favorable environmental production practice to cover partially the rapidly expanding market opportunities being created by economic political and environmental drivers. THE NEEDS The real problem is global warming and the impeding need for reduction/elimination of GHG emissions by replacing fossil fuels with renewable energy as ethanol and Biodiesels. Ethanol made from cellulosic fibers, targets first the transportation (gasoline and diesel fuels) sector with new application and development in the distributed power generation (electricity) and renewable-based organic chemical industries, creating colossal market opportunities for a competitive cellulosic hydrolysis process. The need for an efficient and economical biomass refining technology has increased substantially. Furthermore, increased biomass production will effectively sequester CO2 and thereby, reduce GHG emissions and turn an obligation into an asset in the form of increased biomass, ethanol and co-products production. Ethanol will take the form of a market-driven commodity, which allows participation of all countries on this planet. Biomass utilization for energy purposes represents a reliable raw material resource and does not interfere with growing demands for foodstuffs. This project is agreed in Article 12 of the Kyoto Protocol provides for Emissions Trading, Joint Implementation Measures and a new Clean Development Mechanism (CDM) for encouraging industrial countries and companies to invest in greenhouse gas 29

emission reductions in developing countries. By participating in these measures that generate greenhouse gas reductions in a developing country, an industrialized country or its companies could earn carbon emission reduction credits to meet the country's Kyoto protocol obligations. The projects demanded market in the U.S.; legislation has been proposed to give companies credit now against future carbon reduction requirements for the climate mitigation measures that they finance now in developing countries. We are looking a strategic partner willing to make such investments already in anticipation of credit legislation. In this sense, International emission trading allowances also have been proposed to reduce the costs of carbon mitigation measures. Economic Benefits.- Ecuador has capacity - due to its privileging strategic and climate situation to install easily 5 ethanol refineries under the following conditions: . - Enough first-class feedstock . - Low-income labor costs . - Plenty fertile land availability. .- All year-round good weather conditions to operate the plant 360 working-days, using biomass from sugarcane and banana plantations residues and waste. .- Ready sugar cane plantation (70,000 hectares) and low-cost agricultural residues, including 150,000 hectares banana crop residues at almost labor cost per tone plus transportation. (7 million metric tons a year) for developing 4 more plants in the near future. .- Plenty virgin rain forests, including an ample variety of trees of soft and hardwood ready to be harvest for exports and the residues to be used as feedstock (biomass) for the project (350,000 hectares available) . - Plenty water Resources .- Ready willingness and open policy to international investors on ethanol refineries, through Agriculture Trusts and by also constituting mixed economy companies in Ecuador. . - Our tropical crops, including bananas (high percentage of cellulose), are excellent alternative feedstock for ethanol production worldwide. The total investment of the 5 refineries will sum US$1 billion dollars on the coastal section of Ecuador. This new ethanol industry will create directly and indirectly 2,000 administrative employees and around 50,000 jobs in the agriculture field. The demand for feedstock by ethanol production will increase net farmers income substantially. The creation of this new ethanol production will offer enormous potential for economic growth for Ecuador mainly in small rural communities. The total production of ethanol-5 refineries will be around 500 million gallons/yr. Many farmers will own and operate ethanol plants, allowing them to add value to their own typical and traditional crops in the coastal region of Ecuador. Ethanol production also generates exports of feed co-products, such as gluten, further enhancing Ecuadors balance of international trade. Ethanol production is extremely energy sufficient, with a positive energy balance of 125% compared to 85% for gasoline. Ethanol production by far the most efficient method of producing liquid transportation fuels. 10-percent ethanol blends reduce carbon monoxide better than any other reformulated gasoline blend-more than 25%.

30

Ethanol is low in reactivity and high in oxygen content, making it effective tools in reducing ozone pollution. Ethanol is a safe replacement for toxic octane enhancers in gasoline such as benzene, toluene and xylene. Oil companies are now starting to acknowledge the environmental and energy benefits of ethanol.

Thus, The Ethanol Biological Refineries are sustainable projects and called for those with capacity to return the investment (ROI over 35%) and pay the fully construction and facilities such as installations of the plants, the maintenance and operating cost on such plants, including the raw materials and finally obtained manufactured goods or products with adequate international market. The generation of good profits as result of the use of the best technology available to manufactured such products and an adequate international marketing of their products through specialized strategic allied companies which count with the necessary infrastructure to deliver the manufactured products under the best conditions and terms and time frame of delivery. Only with the developing of right-self sustainable agro-industrial projects like the Ethanol Biorefineries Projects, we can assure to achieve a good source of opportunities and that is the generation of employment, it is the simply way to support and maintained a good standard of living for Ecuadors poor people. All other ways, including international aids, governments subsidies, etc. Are both transitory and an illusion fact. It is necessary the change the current realities of life of the average person, mainly to farmers and peasants, by sustainable industrial projects that will provide our communities a reasonable chance to have the basic modicums of human existence, including the focusing to reforestation, potable water and clean energy sources. The other key aspect of a successful project is the financial scenario involved by a strategic partner who is familiarized with financial procedures the know how investment are complemented such placing the funds into a secured vehicle, which is then used as a collateral base for entry into a Private Placement Buy/Sell Contract. We are willing to have access Capital Venture Companies to use several financial vehicles. Starting with an amount of US$200 million for the first plant can be used in such a program, and the returns will be managed by the Investor to produce all the necessary capital. The solution of Ecuadors poor people is to convert the lack of economic opportunity into the provision of sustainable work based in our own real wealth fertile lands in major industrial projects to provide such opportunity for our people. The Ecuadorian participation would be the fixed assets of our lands and low cost of labor converting them through a trust in title of credit or any other banking instruments. We are able to place the certification of acquisition and legal ownership of 40,000 hectares of fertile land with dully appraisal study of resources for US$100 million dollars into a Bank Certificate of Deposit or Fiduciary Certificates that represent certain amount of tons of raw material, such as sugarcane, banana residues, or cassava. The labor opportunity is a real source of labor, depending in the projects geographical mobility and more flexibility in the labor market. This means that an employee hire in one plant could be employed easily in another plant, based in the participation as stockholder in the major project, including their social and labor lawful benefits. Plus more benefits 31

such as a chain of supermarket stores where all projects partners and employees are able to be supplied with the main four lines for a good living, namely, food, clothing, medicine and educational materials at very convenience prices. Only through going back to agricultural fields to produce biomass to convert them into biofuels, tropical developing countries, like this case in Ecuador, we are able to face successfully the phantom of unemployment. Going back to the fields is a real employment, it is to do something, is not only a mode of subsist, or a way to our own outclass, but is a way to be in the world and be someone in it; it is the origin of convincing that we contribute with something, that we are useful, that we left a tract in our world. One a global scale, biomass refining and bioethanol production will become significant economic engines for sustainable development of developing countries and facilitate shifts from fossil to renewable energy in countries such Ecuador. We as promoter of these important project are generating large number of employments, according to the recommendation number 150 of 1975 of the International Labor Organization-ILO which goals to assure access to the active economical population to productive employment and protect the laborers against the unemployment of lost of incomes. Yes these projects are good sources of work, employment, service, and professional education, in order to obtain excellence in crop production as biomass and convert it into high-quality biofuels serving people and our society. The development of agro-industrial projects to convert the carbons contained in cellulose into biofuels are really environmental projects focusing the general welfare for people in Ecuador, helping to detoxify the atmosphere by high level octane and oxygenating fuels such ethanol is. Our final high quality ethanol products are for all kind of people and also we are assuring to stabilize the generation of employment for the next 50 years based in the high demand of 220,000 million of petroleum derived-fuel a year that need to be converted in biofuels. They constituted the best initiatives to generate long-term employments for the new era to come soon or just initiated. We are in the terms to remedy the structural unemployment in Ecuador with a long-term projects under good-stable economic frame, with biofuel products orientated to international market among industrialized countries, with wholly owned private participation, and using thousands of farmers, peasants, and unskilled labor force for soil preparation, seeding, and maintaining of cultivations through segmented markets, and finally the harvest of such crops and deliver the products to the projects plant. Then for the processing to convert the biomass into ethanol and other byproducts a good number of employees and skilled labor force are used at the plants or biorefineries. Finally, the operation of exporting the ethanol and byproducts are also a good source of employment until delivers the final products to be loaded at the terminal into tank ships. The thousand of persons or individuals that are covered with employment under these projects are considered from the starting point as the capacity of each human spirit to propel development, by not only achieving but multiply the resources involved in this agro-industrial project the fertile land and labor. From this point of view each person is considered as an investment and not as a charge. This means that each one represent a long-term benefit for the project by adhering his land and familys labor to their best of skills, thus converting his assets from finite to un-finite, contributing the privatization of

32

the Ecuadorian economy, by generating his own proper added value to our project, but convinced that all his fixed resources depend on his human work. Worldwide Demand also make these projects are the best alternatives for tropical countries like Ecuador, offering a year around supplies of all kind of agricultural crops rich in cellulose such as sugarcane, cassava and banana plantation as main crops and secondly corn, rice, soybean, yucca, sweet potato, etc. Ecuadors land with its unique photosynthesis offers a great opportunity to supply ethanol for industrialized countries for the next carbohydrate era for this century. Ecuador has a great opportunity to install at least 5 biorefineries, producing according to the commercial proved technologies to obtain 100 million gallons of ethanol per year and plant, totaling 500 million gallons for the 5 plants. All this production will be marketed to meet the American people needs and deficit of 3.500 million gallons of ethanol at an averaging price of US$1.30 per gallon. This means US$650 million dollars a year with a net profit of US$0.40 and 0.50 cents per gallon, totaling around US$300 million net profit a year for the 5 refineries. Economic Benefits.- Ecuador has capacity - due to its privileging strategic and climate situation to install easily 5 ethanol refineries under the following conditions: .- Enough first-class feedstocks .- Low-income labor costs .- Plenty fertile land availability .- All year-round good weather conditions to operate the plant 360 working-days, using biomass from sugarcane and banana plantations residues and waste. .- Ready banana crop residues at US$20.00 cost per ton, including transportation. (250,000 metric tons a year). .- Plenty virgin/secondary forests, including an ample variety of tress. .- Plenty water Resources .- Ready willingness and open policy to international investors on ethanol refineries, through Agriculture Trusts and by also constituting mixed economy companies in Ecuador. .- Our tropical crops, including bananas (high percentage of cellulose), are excellent alternative feedstocks for ethanol production worldwide. The total investment of the 5 refineries will sum US$1000 million dollars on the coastal section of Ecuador. This new ethanol industry will create directly and indirectly 1,250 administrative employees and around 30,000 jobs in the agriculture field. The demand for feedstocks by ethanol production will increase net farmers income substantially, helping the rural areas in Ecuador. The creation of this new ethanol production will offer enormous potential for economic growth for Ecuador mainly in small rural communities. The total production of ethanol-5 refineries will be around 500 million gallons/yr. Many farmers will own and operate ethanol plants, allowing them to add value to their own typical and traditional crops in the coastal region of Ecuador. Ethanol production also generates exports of feed co-products, such as gluten, further enhancing Ecuadors balance of international trade.

33

Ethanol production is extremely energy sufficient, with a positive energy balance of 125% compared to 85% for gasoline. Ethanol production by far the most efficient method of producing liquid transportation fuels. 10-percent ethanol blends reduce carbon monoxide better than any other reformulated gasoline blend-more than 25%. Ethanol is low in reactivity and high in oxygen content, making it effective tools in reducing ozone pollution. Ethanol is a safe replacement for toxic octane enhancers in gasoline such as benzene, toluene and xylene. Oil companies are now starting to acknowledge the environmental and energy benefits of ethanol. This ethanol project in based in a successful approach to promote ethanol as renewable fuel to transportation to cover the market of over 180 million people that live in developing countries mandating mixing ethanol with gasoline and also to supply partially the increasing demand for ethanol in the North American market. The United States consumes 60% of the world demand of fuels and now it is demandable to mix ethanol at 5% with fuels for transportation and by 2010 at 10%. This project will impact directly on rural development in Ecuador and its applications offering the economic and social benefits most needed such as social benefits and quality of life, rather than income and economic benefits have driven this renewable fuel project in rural areas. It also incorporate the additional energy dimension into existing development activities for water, health, education, agriculture, Socio-economic Project.- Thus, The Ethanol Biologial Refineries, are sustainable type of mature projects and called for those with capacity to return the investment (ROI 35%) and pay the fully construction and facilities such as installations of the plants, the maintenance and operating cost on such plants, including the raw materials and finally obtained manufactured goods or products highly demanded in the international market. Generation of good profits as result of the use of the best technology available to manufactured such products and efficiently marketing of their products through specialized strategic allied companies which account with the necessary infrastructure to deliver the manufactured products under the best conditions and terms and time frame of delivery, mainly to the North American market. Ecuadors poor people only with the developing of right-self sustainable agro-industrial projects like the Ethanol Biorefineries Projects, we can hope to achieve a good source of opportunities and that is the generation of large-number of employment, it is the simply way to support and maintained a good standard of living for Ecuadors poor people. All other ways, including international aids, governments subsidies, etc. are both transitory and an illusion fact. It is necessary the change the current realities of life of the average person, mainly to farmers and peasants, by sustainable industrial projects that will provide our communities a reasonable chance to have the basic modicums of human existence, including the focusing to reforestation, potable water and clean energy sources.

34

The other key aspect of a successful project like the present one is the financial scenario involved by a strategic partner who is familiarized with financial procedures the know how investment are complemented such placing the funds into a secured vehicle, which is then used as a collateral base for entry into a Private Placement Buy/Sell Contract. We have access through international banks, to several such vehicles. through reputable Insurance/Investment firms. The solution of Ecuadors poor people is to convert the lack of economic opportunity into the provision of sustainable work based in our own real wealth fertile lands in major industrial projects to provide such opportunity for our people. The Ecuadorian participation would be the fixed assets of our lands and low cost of labor converting them through a trust in title of credit or any other banking instruments. Only through going back to agricultural fields to produce biomass to convert them into biofuels, tropical developing countries, like this case in Ecuador, we are able to face successfully the phantom of unemployment. Going back to the fields is a real employment, it is to do something, is not only a mode of modus vivendis, or a way to our own outclass, but is a way to be in the world and be someone in it; it is the origin of convincing that we contribute with something, that we are useful, that we left a tract in our world. We as promoter of these important project are generating large number of employments, according to the recommendation number 150 of 1975 of the International Labor Organization-ILO which goals to assure access to the active economical population to productive employment and protect the laborers against the unemployment of lost of incomes. Yes these projects are good sources of work, employment, service, and professional education, in order the obtain the excellence in crop production as biomass and convert it into high-quality biofuels serving people and our society. The development of agro-industrial projects to convert the carbons contained in cellulose in biofuels are really environmental projects focusing the general welfare for people around the world, helping to de-intoxicate the atmosphere by high level octane enhancer and oxygenate fuels such ethanol is. Our final high quality ethanol products considered in this project are for all kind of people and also we are assuring to stabilize the generation of employment for the next 50 years based in the conversion technology in the high demand of 200,000 million of pretroleum derived-fuel a year that need to be converted in biofuels. They constituted the best initiatives to generate long-term employments for the new era to come soon or just initiated. The project also considers to form and establish a Non Governmental organization to manage a research institute that will lead future researching in new developing of biomass to convert into ethanol and also to provide scholarships in order to specialize new young people in the ethanol industry and further on they will become expert in sugarcane and other feedstocks to convert them into ethanol. Remedying the Structural Unemployment in Ecuador .- We are in the terms to remedy the structural unemployment in Ecuador with a long-term projects under good-stable economic frame, with biofuel products orientated to international market among

35

industrialized countries, with wholly owned private participation, and using thousands of farmers, peasants, and unskilled labor force for soil preparation, seeding, and maintaining of cultivations through segmented markets, and finally the harvest of such crops and deliver the products to the projects plant. Then for the processing to convert the biomass into ethanol and other byproducts a good number of employees and skilled labor force are used at the plants or biorefineries. Finally, the operation of exporting the ethanol and byproducts are also a good source of employment until deliver the final products to be loaded at the terminal in containerships. The thousand of persons or individuals that are covered with employment under these projects are considered from the starting point as the capacity of each human spirit to propel development, by not only achieving but multiply the resources involved in this agro-industrial project the fertile land and labor. From this point of view each person is considered as an investment and not as a charge. This means that each one represent a long-term benefit for the project by adhering their land and familys labor to their best of skills, thus converting his assets from finite to infinite, contributing the privatization of the Ecuadorian economy, by generating peoples own proper added value to our project, but convinced that all their fixed resources depend on human work. Worldwide Demand also make these projects are the best alternatives for tropical countries like Ecuador, offering a year around supplies of all kind of agricultural crops rich in cellulose such as sugarcane and banana plantation as main crops and secondly corn, rice, soybean, yucca, sweet potato, etc. Ecuadors land with its unique photosynthesis offers a great opportunity to supply ethanol for industrialized countries for the next carbohydrate era for this century. The current demand is around 220,000 million gallons of fuels a year, but the current world production is only 24,000 million gallon, being Brazil the biggest ethanol producer with around 13.5000 million gallons a year. The USA only produces 1,600 million gallons of ethanol per year distributed among 73 ethanol biorefineries using corn and potato as raw materials, but their current demand is about 5,000 million gallons a year, that means a deficit of 3.400 million gallons of ethanol a year. For that reason 13 new biorefineries are currently being constructed and they will be finished for next year. Ecuador has a great opportunity to install at least 5 biorefineries, producing 100 million gallons of ethanol per year, totaling 500 million gallons. All this production will be marketed to meet the American people needs and deficit of 3.500 million gallons of ethanol at an averaging price of US$1.30 per gallon. This means US$650 million dollars a year with a net profit of US$0.40 and 0.50 cents per gallon, totaling around US$300 million net profit a year for the 5 refineries. TO ISSUE A NEW SYSTEM OF CURRENCY INSIDE A DETERMINATE TERRITORY. .- PROMOTER FIRM: ETANOLSA S.A. .- TERM: 25 YEARS MINIMUM .- TRUSTEE: SEA- SANTA ELENA AGREEMENT .- SEAS TERRITORY: 50,000 HECTARES OF FERTILE LAND TO BE CULTIVATED WITH ENERGY CROPS TO BE CONVERTED INTO BIOFUEL. .- POPULATION TO BE AFFECTED OR BENEFIT: 20,000 FAMILES OR 100,000 INHABITANTS APPROXIMATELY. 36

.- LOCATION: PENINSULA OF SANTA ELENA, GUAYAS AND SANTA ELENA PROVINCES, ECUADOR .- PRODUCTION OF BIOFUELS: 500 MILLIONS GALLONS PER YEAR .- GENERATION OF FUNDS: EQUIVALENT TO US$1 BILLION DOLLARS PER YEAR. a) Form and Legal Status of the Currency The SEA-Santa Elena Agreement will establish a digital barter or bond system to be arranged for the printing of Labor Certificates and Credit Card system to star or initiate to the value of US$10 Million Dollars per month in a term to be used during 10 years. The Certificates will be numbered and will be for 5 or 10 dollars respectively, including stateof-the-art technology applied in each certificate. They become only valid as soon as release from SEAs offices and distributed among the workers and employees every month as part of their salaries, and will be good to exchange for goods and services at all supermarkets and Commercial Malls to be constructed along the SEA Territory, covering 50,000 thousands square hectares, mainly located in the Peninsula of Santa Elena. A biometric encryption system will be employed to identify the bearer of the certificates and Credit Cards at the place of dispends of the goods and services. There is no additional charges or any or all the transactions used in the exchange of goods and services inside the territory. All certificates are subject to convert them into ordinary dollars according to personal circumstances that merits that conversion a la par, according to the SEA-Santa Elena Agreement. b) Cover. In order to be able to effect this conversion at any time and thereby to provide a cover for the relief certificates, the trustees-SEA will arrange to deposit at the International Bank to be selected, with local corresponds commercial banks in Ecuador, an amount in legal dollar currency equivalent to that issued in the form of barter and bonds or Labor Certificates. As SEA acts as trustee, a director of the bank informs SEA, the total amount of funds to be transacted every month, including any kind of banking services cost, but preferable free since the local savings bank gives its services gratis where an utility transaction is concerned. The reverse side of the Certificate contains the following declaration : " To all whom it may concern ! Because Human beings live by exchanging their services. This Certificate is for to enhancing this exchange of services and by its means assures to stabilize the standard of living of the workers and employees, covered by the SEA-Santa Elena Agreement, for any goods and services provided inside the territory of the Biofuel Biorefineries to be established in the Peninsula of Santa Elena by SEA as the promoter of this project. c) Circulation. All workers and employees covered by the SEA will have to sign and agreed with the use and circulation of the barter or bond system as a form of payment in every month for all goods and services to be provided inside the territory of the SEA. The SEA will contract with all providers of such goods and services and will responsible for all payment of the goods and services utilized inside the territory for such amount of money or banking

37

instruments to guarantee or backed for one month period and to be rotating during the whole year. All account for each workers and employees will be cleared up every month according to a pre-established individually rate deducted from the US$500.00 per month minimum salary and per each worker and employee. All business establishments at SEA territory will accept the relief money in payment and at its face value, and the Certificates or a Credit Card to be issued per each workers and employees that signs the SEA. It is necessary to emphasize that the Certificates and the Credit Card are no transferable, non-negotiable, and only to be used per the worker or employee under the SEA this which aims at accelerating the circulation and not at hoarding. d) Results. As all business establishments at SEA territory will accept the relief money (Barter or Bond Currency and Credit Card System) as if it were legal currency, because SEA guarantees or backed with banking instruments all transactions with them under legal pre-signed contracts. This establishment of assuring the demand and provision of goods and services by and for the workers and employees, creates a fairly market where no rise in prices will appear to have occurred, a fact probably due to purely local conditions there will be no inflation. The workers and employees are the principal beneficiary of the new currency employed inside SEA territory. The first direct gain resulting from this kind of currency will the relief taxation derived from the circulating certificates and credit cards. It will be significant that our commercial Banks will accept in deposit relief notes at their face value, provided that the depositor agrees to accept relief notes in repayment and dully guarantee by SEA. The wage payments involved here were exclusively made in labor certificates, but the more rapid circulation of the currency inside SEA territory will be invigorated the local economic life generally and also will act as a thawing agent of all kinds of frozen debts, bringing work and bread everywhere. This conviction is shared by the whole workers and employees of SEA. Barter or Bond and Credit Card System will be established inside SEAs territory as currency money are adapted to fulfill the functions of money in every respect Just as well as - or, for the purpose of accelerating its circulation, much better than - unvarying legal tender. No difficulties will arise in making payments in the new currency and for sure there will not be a single complaint and after a brief period our currency money will be accepted without demur in all shops inside SEAs Territory to determine the effectiveness of legal pre-signed contracts between SEA and the providers of goods and services. It may be further taken as proved that it is possible, regardless of existing circumstances or of locality, to introduce barter or bond and Credit Card System as money currency in communities, districts, provinces, or the State among a selected or preferable group of people where the effect on the circulation is the more salutary, the larger the territory involved. The presence of a second currency as the one proposed in the SEA will not be inimical to the introduction of currency money, because experience has shown that the two systems may co-exist, peacefully, without friction, and without -inconvenience, and that one system does not prejudice the other, but rather aids it in fulfilling its social mission and to revive economic activity. The communities of workers and employees will be also protected from external influences, and local improvements not only neutralized these influences, but lightened the burden to be borne. 38

g) Seigniorage Seigniorage in the SEA establishment will be the difference between the value of money to be deposit in prime banks to guarantee all transaction inside SEAs territory and the cost to produce barter/bond (Labor Certificate) and Credit Card System to be used as distributor/circulation as exchange of goods and services - in other words, the economic cost of producing a digital currency system or method within SEAs territory. This kind of seigniorage will be positive, then the SEA as a trustee of funds will make an economic profit; that could be counted as revenue for SEA when the currency that will be created is worth more than it costs to produce it. This revenue will be used by SEA to finance a portion of their expenditures because there no recollection of taxes in this sense, and it will be only an interest-free loan to the issuer as the carry on money in circulation. This kind of currency will be a positive medium of exchange for goods and services, which will be the basis for our trade inside our territory. In our system this kind of seignorage will be applied when we will use our currency based in a state-of-the-art digital platform as a medium of exchange goods and services, because the contracted providers of such goods and services will hold the Labor Certificates for the entire time until they will be paid with bank instruments only and not in cash according to an pre-settled agreement, but SEA will always have the cash in prime banks, in addition of the cash to be produced or generated by biofuels to domestic and worldwide exports (around US$1 Billion Dollars in full operation according to Price at the International Stock Exchange Markets). This means that the real wealth of providers of goods and services who will held the banking instruments such as Bank Guarantee or Letter of Credit will decrease and the wealth of the issuer (SEA) of the circulation of this kind of money will increase on benefits of all workers and employees. This is a redistribution of wealth from the people to the issuers of newly-created money currency (SEA) very similar to a tax. In our establishment this is the main reason that will offer in support of the creation of a modern, independent, Trustee of the liquid money (SEA) whose primary objective is arguably to ensure the value of currency by controlling monetary expansion and thus limiting inflation. Independence from government is required to reach this aim - indeed, it is well known in economic literature that governments face a conflict of interest in this regard. Inflation will be limited because the SEA will manage, control and pay all goods and services under pre-settled business contracts to be consumed and demand inside our territory on favor of all our workers and employees. The SEA should determine how much it creates in the light of the objectives chosen for the SEA's new monetary currency policy and credit the new money to the workers and employees under the SEA who will then put it into circulation by spending it using a state-of-the-art digital platform that convergence and integration of technologies that enable authentication with biometric encryption in almost all market segments including food, clothing, healthcare, educational materials, and leisure and entertainment . i) Resistance from Without and Opposition of the Local Provincial Authorities. All commercial banks in Ecuador will not be opposed to the issue of relief currency bond and credit card system to be used in SEAs territory, because the issue of these currencies are not new in our market like credit cards and Christmas bonds, but not guarantee by banking instruments. The deposit of US$10 Million Dollars per month until deployed which rotates and converts the workers and employees as preferable 39

customers when use the bond and credit card system to exchange goods and services among pre-contracted providers places. These funds should be deposited in Ecuadorian banks in a special account, where it could not be touched and, of course, would carry certain interest that will generate enough funds to pay any service banking costs . This would prevent a multiplication of the means of payment and exclude all inflation. These certificates are decidedly more harmless than the expanded credits of numerous financial institutions which have by no means been so sternly dealt with. h) Results. This is a conception that will have for sure challenges, but, in fact, a rise in prices will not take place at SEA territory. This new investments will be economically sound, and it will be a fact, as soon as SEA will deposit the first US$10 Million Dollars on behalf of the workers and employees under the SEA. This practice will increase in money currency, then, the miracle that economic values may be created out of cash in Dollars account in international prime banks with a good organization, and a determined collective spirit under the SEA are to be regarded as economically real value of economic wisdom. According to the universalistic teaching, money is graded in value. The highest grade would be represented in our SEA labor certificates and Credit Card System will be a creation of not newly money currency, which is guaranteed by money of the higher and highest (banknote) grade. This by all means will act and prove that such a creation of this kind of digital money currency will in exceptional circumstances will be proven of considerable advantage to a given locality communities under the SEA in the near future. In this manner the funds obtained to develop the SEA will remain as a sink fund to issue and leverage banking instruments to pay all start up or initial expenses for the construction of each Biorefinery as well as the preparation of land/soil in measure of 10,000 hectares per plant. Until the labor force of 20,000 workers and employees will be ready to produce 500 millions gallons of biofuels which will generate ample means of funds in the domestic and international markets. This means a significant generation of fresh funds that will reach, when all 5 plants will be in full state of operations, at around of US$1 Billion Dollars per year, in addition to the US$ Billion Dollars of previous deposit as a sink funds. PREPARED BY WELLINGTON GALLARDO, FINANCIAL COORDINADOR PLACE: GUAYAQUIL, ECUADOR DATE: JANUARY, 2013 PROJECT: BIOFUEL CORRIDOR IN SANTA ELENA PROVINCE, GUAYAS AND SANTA ELENA PROVINCES, REPUBLIC OF ECUADOR. CASH FLOW OF SALARIES MONTHLY PAYMENT FOR WORKERS: US$500,00 PLUS LEGAL BENEFITS = 5-YEARS REVOLVING WORK CONTRACT : US$30,000 10 YEAR WORK CONTRACT : US$60,000.00 TOTAL NUMBER OF WORKERS: 20,000, AT A RATE OF 4,000 PER BIOREFINERY 40 US$6,000 PER YEAR, TOTAL

TOTAL PAYMENT: US$10,000,000 MONTHLY TOTAL PAYMENT PER YEAR : US$120 MILLIONS TOTAL PAYMENTS DURING 10 YEARS: US$1,200 MILLIONS MONTHLY PAYMENT PER HOUSE: US$150,00 YEAR PAYMENT PER HOUSE: US$1,800 TOTAL PAYMENT PER HOUSE DURING 10 YEARS : US$18,000 MONTHLY PAYMENT FOR FOOD : US$200,00 YEAR PAYMENT FOR FOOD: US$2,400,00 TOTAL PAYMENT FOR FOOD DURING 10 YEARS: US$24,000.00 MONTHLY PAYMENT FOR EDUCATION : US$50.00 YEAR PAYMENT FOR EDUCATION : US$600.00 10 YEAR PAYMENT FOR EDUCATION : US$6,000.00 MONTHLY PAYMENT FOR CLOTHING : US$50.00 YEAR PAYMENT FOR CLOTHING : US$600.00 10 YEAR PAYMENT FOR CLOTHING : US$6,000.00 MONTHLY PAYMENT FOR HEALTH : US$25.00 YEAR PAYMENT FOR HEALTH : US$300.00 10 YEAR PAYMENT FOR HEALTH : US$3,000.00 BALANCE PER SALARY PER MONTH: US$25.00 BALANCE PER SALARY PER YEAR: US$300.00 BALANCE PER SALARY DURING 10 YEARS: US$3,000.00 ALL BENEFITS BY LAW WILL BE PAID BY SEA AS AN ADDITIONAL BONUS TO THE SALARY. TO ISSUE A NEW SYSTEM OF CURRENCY INSIDE A DETERMINATE TERRITORY. .- PROMOTER FIRM: ETANOLSA S.A. .- TERM: 25 YEARS MINIMUM .- TRUSTEE: SEA- SANTA ELENA AGREEMENT

41

.- SEAS TERRITORY: 50,000 HECTARES OF FERTILE LAND TO BE CULTIVATED WITH ENERGY CROPS TO BE CONVERTED INTO BIOFUEL. .- POPULATION TO BE AFFECTED OR BENEFIT: 20,000 FAMILES OR 100,000 INHABITANTS APPROXIMATELY. .- LOCATION: PENINSULA OF SANTA ELENA, GUAYAS AND SANTA ELENA PROVINCES, ECUADOR .- PRODUCTION OF BIOFUELS: 500 MILLIONS GALLONS PER YEAR .- GENERATION OF FUNDS: EQUIVALENT TO US$1 BILLION DOLLARS PER YEAR. a) Form and Legal Status of the Currency The SEA-Santa Elena Agreement will establish a digital barter or bond system to be arranged for the printing of Labor Certificates and Credit Card system to star or initiate to the value of US$10 Million Dollars per month in a term to be used during 10 years. The Certificates will be numbered and will be for 5 or 10 dollars respectively, including state-ofthe-art technology applied in each certificate. They become only valid as soon as release from SEAs offices and distributed among the workers and employees every month as part of their salaries, and will be good to exchange for goods and services at all supermarkets and Commercial Malls to be constructed along the SEA Territory, covering 50,000 thousands square hectares, mainly located in the Peninsula of Santa Elena. A biometric encryption system will be employed to identify the bearer of the certificates and Credit Cards at the place of dispends of the goods and services. There is no additional charges or any or all the transactions used in the exchange of goods and services inside the territory. All certificates are subject to convert them into ordinary dollars according to personal circumstances that merits that conversion a la par, according to the SEA-Santa Elena Agreement. b) Cover. In order to be able to effect this conversion at any time and thereby to provide a cover for the relief certificates, the trustees-SEA will arrange to deposit at the International Bank to be selected, with local corresponds commercial banks in Ecuador, an amount in legal dollar currency equivalent to that issued in the form of barter and bonds or Labor Certificates. As SEA acts as trustee, a director of the bank informs SEA, the total amount of funds to be transacted every month, including any kind of banking services cost, but preferable free since the local savings bank gives its services gratis where an utility transaction is concerned. The reverse side of the Certificate contains the following declaration : " To all whom it may concern ! Because Human beings live by exchanging their services. This Certificate is for to enhancing this exchange of services and by its means assures to stabilize the standard of living of the workers and employees, covered by the SEA-Santa Elena Agreement, for any goods and services provided inside the territory of the Biofuel Biorefineries to be established in the Peninsula of Santa Elena by SEA as the promoter of this project. c) Circulation.

42

All workers and employees covered by the SEA will have to sign and agreed with the use and circulation of the barter or bond system as a form of payment in every month for all goods and services to be provided inside the territory of the SEA. The SEA will contract with all providers of such goods and services and will responsible for all payment of the goods and services utilized inside the territory for such amount of money or banking instruments to guarantee or backed for one month period and to be rotating during the whole year. All account for each workers and employees will be cleared up every month according to a pre-established individually rate deducted from the US$500.00 per month minimum salary and per each worker and employee. All business establishments at SEA territory will accept the relief money in payment and at its face value, and the Certificates or a Credit Card to be issued per each workers and employees that signs the SEA. It is necessary to emphasize that the Certificates and the Credit Card are no transferable, non-negotiable, and only to be used per the worker or employee under the SEA this which aims at accelerating the circulation and not at hoarding. d) Results. As all business establishments at SEA territory will accept the relief money (Barter or Bond Currency and Credit Card System) as if it were legal currency, because SEA guarantees or backed with banking instruments all transactions with them under legal pre-signed contracts. This establishment of assuring the demand and provision of goods and services by and for the workers and employees, creates a fairly market where no rise in prices will appear to have occurred, a fact probably due to purely local conditions there will be no inflation. The workers and employees are the principal beneficiary of the new currency employed inside SEA territory. The first direct gain resulting from this kind of currency will the relief taxation derived from the circulating certificates and credit cards. It will be significant that our commercial Banks will accept in deposit relief notes at their face value, provided that the depositor agrees to accept relief notes in repayment and dully guarantee by SEA. The wage payments involved here were exclusively made in labor certificates, but the more rapid circulation of the currency inside SEA territory will be invigorated the local economic life generally and also will act as a thawing agent of all kinds of frozen debts, bringing work and bread everywhere. This conviction is shared by the whole workers and employees of SEA. BARTER OR BOND AND CREDIT CARD SYSTEM will be established inside SEAs territory as currency money are adapted to fulfill the functions of money in every respect Just as well as - or, for the purpose of accelerating its circulation, much better than unvarying legal tender. No difficulties will arise in making payments in the new currency and for sure there will not be a single complaint and after a brief period our currency money will be accepted without demur in all shops inside SEAs Territory to determine the effectiveness of legal pre-signed contracts between SEA and the providers of goods and services. It may be further taken as proved that it is possible, regardless of existing circumstances or of locality, to introduce barter or bond and Credit Card System as money currency in communities, districts, provinces, or the State among a selected or preferable group of people where the effect on the circulation is the more salutary, the larger the territory involved. The presence of a second currency as the one proposed in the SEA will not be inimical to the introduction of currency money, because experience has shown that the two systems may co-exist, peacefully, without friction, and without -inconvenience, and that one system 43

does not prejudice the other, but rather aids it in fulfilling its social mission and to revive economic activity. The communities of workers and employees will be also protected from external influences, and local improvements not only neutralized these influences, but lightened the burden to be borne. g) Seigniorage Seigniorage in the SEA establishment will be the difference between the value of money to be deposit in prime banks to guarantee all transaction inside SEAs territory and the cost to produce barter/bond (Labor Certificate) and Credit Card System to be used as distributor/circulation as exchange of goods and services - in other words, the economic cost of producing a digital currency system or method within SEAs territory. This kind of seigniorage will be positive, then the SEA as a trustee of funds will make an economic profit; that could be counted as revenue for SEA when the currency that will be created is worth more than it costs to produce it. This revenue will be used by SEA to finance a portion of their expenditures because there no recollection of taxes in this sense, and it will be only an interest-free loan to the issuer as the carry on money in circulation. This kind of currency will be a positive medium of exchange for goods and services, which will be the basis for our trade inside our territory. In our system this kind of seignorage will be applied when we will use our currency based in a state-of-the-art digital platform as a medium of exchange goods and services, because the contracted providers of such goods and services will hold the Labor Certificates for the entire time until they will be paid with bank instruments only and not in cash according to an pre-settled agreement, but SEA will always have the cash in prime banks, in addition of the cash to be produced or generated by biofuels to domestic and worldwide exports (around US$1 Billion Dollars in full operation according to Price at the International Stock Exchange Markets). This means that the real wealth of providers of goods and services who will held the banking instruments such as Bank Guarantee or Letter of Credit will decrease and the wealth of the issuer (SEA) of the circulation of this kind of money will increase on benefits of all workers and employees. This is a redistribution of wealth from the people to the issuers of newly-created money currency (SEA) very similar to a tax. In our establishment this is the main reason that will offer in support of the creation of a modern, independent, Trustee of the liquid money (SEA) whose primary objective is arguably to ensure the value of currency by controlling monetary expansion and thus limiting inflation. Independence from government is required to reach this aim - indeed, it is well known in economic literature that governments face a conflict of interest in this regard. Inflation will be limited because the SEA will manage, control and pay all goods and services under pre-settled business contracts to be consumed and demand inside our territory on favor of all our workers and employees. The SEA should determine how much it creates in the light of the objectives chosen for the SEA's new monetary currency policy and credit the new money to the workers and employees under the SEA who will then put it into circulation by spending it using a state-of-the-art digital platform that convergence and integration of technologies that enable authentication with biometric encryption in almost all market segments including food, clothing, healthcare, educational materials, and leisure and entertainment . i) Resistance from Without and Opposition of the Local Provincial Authorities.

44

All commercial banks in Ecuador will not be opposed to the issue of relief currency bond and credit card system to be used in SEAs territory, because the issue of these currencies are not new in our market like credit cards and Christmas bonds, but not guarantee by banking instruments. The deposit of US$10 Million Dollars per month until deployed which rotates and converts the workers and employees as preferable customers when use the bond and credit card system to exchange goods and services among pre-contracted providers places. These funds should be deposited in Ecuadorian banks in a special account, where it could not be touched and, of course, would carry certain interest that will generate enough funds to pay any service banking costs . This would prevent a multiplication of the means of payment and exclude all inflation. These certificates are decidedly more harmless than the expanded credits of numerous financial institutions which have by no means been so sternly dealt with. i) Results. This is a conception that will have for sure challenges, but, in fact, a rise in prices will not take place at SEA territory. This new investments will be economically sound, and it will be a fact, as soon as SEA will deposit the first US$10 Million Dollars on behalf of the workers and employees under the SEA. This practice will increase in money currency, then, the miracle that economic values may be created out of cash in Dollars account in international prime banks with a good organization, and a determined collective spirit under the SEA are to be regarded as economically real value of economic wisdom. According to the universalistic teaching, money is graded in value. The highest grade would be represented in our SEA labor certificates and Credit Card System will be a creation of not newly money currency, which is guaranteed by money of the higher and highest (banknote) grade. This by all means will act and prove that such a creation of this kind of digital money currency will in exceptional circumstances will be proven of considerable advantage to a given locality communities under the SEA in the near future. In this manner the funds obtained to develop the SEA will remain as a sink fund to issue and leverage banking instruments to pay all start up or initial expenses for the construction of each Biorefinery as well as the preparation of land/soil in measure of 10,000 hectares per plant. Until the labor force of 20,000 workers and employees will be ready to produce 500 millions gallons of biofuels which will generate ample means of funds in the domestic and international markets. This means a significant generation of fresh funds that will reach, when all 5 plants will be in full state of operations, at around of US$1 Billion Dollars per year, in addition to the US$ Billion Dollars of previous deposit as a sink funds.

PREPARED BY WELLINGTON GALLARDO, FINANCIAL COORDINADOR PLACE: GUAYAQUIL, ECUADOR DATE: JANUARY 20, 2013 PROJECT: BIOFUEL CORRIDOR IN SANTA ELENA PROVINCE, GUAYAS AND SANTA ELENA PROVINCES, REPUBLIC OF ECUADOR Summary and Conclusions Our Mission and Vision 45

Our projects aim is actually to recognize and secure existing best land rights and to lay the foundation for the efficiency toward the cultivation of proper feedstock to be used in the biofuel manufacturing industry field, sustainable and equitable administration of those rights, converting into reality through the construction and installation of biorefineries. Etanolsa S.A. is becoming leader in developing, implementing and managing assistance in biofuel projects, including land administration, land management and land reform sectors, specially focus to the rural communities in Ecuador. Our company counts with an appropriate law specialized team for consulting in titling and cadastre assistance programs, to be used for superior project design, project management, project implementation and evaluation. Besides, we consider Land Administration as a primary source of wealth, and the trading medium and motivation of political issues, economic and political power gains, and other self fulfilling interests. Etanolsa S.A.s task force team is aim to ensure the good governance in land administration as one of most very important factor in assessment of governance within land administration systems. Etanolsa S.A. has been involved during the last two years in educating small and middle class farmers e towards an agricultural market-oriented economy, specialized in diversify agricultural feedstock to be used as raw materials to convert them into biofuels such: sugarcane, jatropha curcas, and cassava roots, etc. while preserving the country's natural resource base as one of the few viable alternatives to promote sustainable economic growth. By reactivating the rural communities lands, encouraging and looking for international finance, creating employment opportunities and improving agricultural productivity and the incomes of small and medium farmers through better access to basic agricultural services, all the biofuel facilities will help definitely to ameliorate Ecuador's extreme poverty. The biorefineries project has two main components. The agricultural technology component will decentralize agricultural public sector services and support the development of a demand-driven mechanism for private and public research and extension. We are also very optimistic and believe that the appropriate land management component will support the design and implementation of a new national cadastre, land titling and land registration system. Specifically, the biofuel project will: (a) streamline administration; (b) establish the basis for an efficient national cadastre; (c) strengthen the Public Register at the central and departmental levels; (d) support the issuance of at least 20,000 land titles, prioritizing beneficiaries by zones; (e) provide technical assistance and equipment to improve field supervision and quality control for the feedstock of the energy crops ; and (f) finance studies aimed at establishing the legal administrative and technical groundwork for the future demarcation of the boundaries of indigenous lands and natural reserves. Ecuador has tremendous potential as a producer of jatropha biodiesel, and our Central Government should include in Ecuadors national biofuels program emphasizing jatropha production. Our project is to employ and implement more than 20,000 hectares of marginalized land, representing a high percent of the total national area, lay barren or under-utilized. Such lands have been for many years without financial supports to develop these lands which account with one of the biggest investment in the constructions of DaulePeripa system of damps, including 4 four supplementary damps located and affecting more than 100,000 hectares in the Peninsula of Santa Elena. This investment has provided a substantial added cost to these lands, and increased the potential agricultural value at this present. We are considering to cover more than 20,000 hectares of this area and bringing fresh private and international resources of US$50 Million dollars per plant, including the developing of 5.000 hectares that would be suitable for growing jatropha.

46

RESUME OF OUR OBJECTIVE Three Components:


Increase Investment in Rural Areas Maintain competitiveness of farmers Rural Poverty reduction

1st Component: Invesment


Strengthen Legal Framework related to property for our energy crops Try to Improve Legislation about financial institutions and capital markets Development of investment line of credits or funds for rural areas for energy crops Labor training for our energy crops Farmers organization, constructing infrastructure for education, health, and supermarket to supply the mainly needs for the people located in our energy crop land areas Support and finance Agriculture Purchasing Contracts Support Agricultural Services: Technology generation, extension and phitosanitary services to assure the best production and harvesting of energy crops .

2nd Component: Support Rural Sector Competetiveness


Demand Driven Extension and Technical Assistance Programs for our Energy Crops Credit Supply for Small and Medium farmers for our energy crops. Support Marketing Services through purchasing on long term: Information and Business Advisory Services in how to apply our lines of credit for energy crops

Costal Region of Ecuador shows significant potential for energy crops production and utilization. Because of unique geographical and other factors, Ecuador is highly vulnerable to interruptions in energy supplies. In spite of this vulnerability, Ecuador continues to rely on imported diesel and gasoline for ~90% of its energy needs for transportation industry These factors and their associated costs and risks make alternative (non-fossil) energy resources, such as wind, geothermal, ocean thermal, solar, and biomass energy, attractive for Ecuador. Ecuadorian government reinforces that the adoption of alternate fuels is one of the most important components in the countrys energy strategy. Utilization of alternative transportation fuels to gasoline and diesel fuel has been demonstrated several times in Ecuador. If ethanol were cost competitive with petroleum-based transportation fuels, Ecuador would be an ideal location to produce, distribute, and use ethanol fuel. Ample land resources exist in Ecuador for energy-crop production . Ecuador has a wide land-use designation, including Conservation, Agricultural, Urban, or Rural. Lands in crops occupy only small fractions of the total lands zoned Agricultural on the coastal region of Ecuador. Agricultural lands currently or formerly in crop production are

47

especially well suited for ethanol-crop production, and large tracts of such lands are available for ethanol-crop production. Downsizing of the sugarcane industry in Ecuador presents an unprecedented opportunity for establishing a new agric-energy industry. The hectare in sugarcane is increasing from about 70,000 hectares to double it in the next 5 years. Efforts have been made to increase sugarcane hectare, mostly with diversified agriculture (e.g., coffee, flowers, and rice, corn, and nursery products); however, these crops are not expected to occupy more than a small fraction of the lands in cane. Large quantities of productive and well-developed agricultural lands presently exist in Ecuador are in "ready to plant" condition. The most promising crops for biofuel conversion in Ecuador include three species, sugarcane, cassava root and jatropha curcas. Three species, sugarcane, cassava rrot and jatropha curcas, were identified as the most promising crops for bifuel production. Sugarcane produces very high quantities of fibre and fermentable sugars (sugarcane grown commercially in Ecuador has an average dry-matter yield of ~80 tons per hectare-year, consisting of about 60% fibre and 40% sugar). Long cultivation history and well-developed infrastructure give sugarcane inherent advantages over other crops. Cassava has been demonstrated to attain very high yields and shows strong commercial potential as an energy crop. Cassava and sugarcane call for similar cultural practices, agronomic conditions, and production infrastructure. They share similar production operations (although some unit operations for cassava are simpler and less costly than corresponding sugarcane operations). The projected yield of cassava, based on several trials performed in Ecuador, is ~60 tons per hectare-year for irrigated fields and ~40 tons per hectare-year for un-irrigated fields. The estimated cost of producing biomass feedstock ranges from $25 to $35 per ton (dry-matter basis). Irrigation, harvesting, and transporting represent the largest cost factors in producing energy crops. Production costs for one sugarcane plantation in Ecuador re used as the basis for this cost analysis on ethanol-crop production. The estimated cost for producing sugarcane for conversion to ethanol, FOB conversion-facility gate, is approximately $35 per ton (drymatter basis). The equivalent cost of production for cassava is about $26 per ton (FOB conversion-facility gate) for the two candidate crops (the cost of land holding is not included in the cost figures). Irrigation, harvesting, and transporting are the major cost factors in energy-crop production in Ecuador. Irrigation represents the largest fraction of total production cost for sugarcane, and cassava. Elimination or reduction of irrigation can significantly reduce biomass production cost. Improvements in harvesting and transporting systems can also help to lower production cost. The unit cost of delivered biomass can be reduced further by increasing crop yield and increasing the number of ratoon or coppice crops obtainable from a single plant crop. Each site has large tracts of lands to produce substantial quantities of biomass feedstock for ethanol conversion. Agricultural residues and MSW are available to supplement the energy crops at each site .

48

Each of the selected sites is or has been in intensive agriculture for decades. Most lands that have been taken out of intensive agriculture have high yield potential and can be converted to ethanol-crop production relatively easily. Crops were selected for evaluation at each site based on their compatibility with the site. The following combinations of crops and acreages capable of providing more than 1000 tons of biomass per day to an ethanol conversion facility were analyzed Residues produced by other agricultural activities, mainly banana, in Ecuador and MSW contain significant amounts of lignocellulosic material that can supplement or replace dedicated energy crops as feedstocks for ethanol conversion. Agricultural residues considered include those from sugarcane, pineapple, banana, passion fruit, flowers, and coffee production. The composition and quantity of MSW vary widely depending on location. One important component in MSW is paper waste which was included in this investigation (all other forms of MSW are neglected). In total, a substantial amount of residues and waste material can be collected on the big cities along the coastal section of Ecuador to supplement dedicated ethanol crops at the WSCo and HC&S sites, respectively. The infrastructure at each site, including those for electricity, water, and transportation, is adequate for energy-crop production and for ethanol conversion . In addition to high yield and acceptable production cost, successful energy-crop production and ethanol conversion depend on the adequacy of infrastructure at the plantation and the conversion facility, including those for electricity, water, and transportation. All three sites have abundant and stable groundwater resources. Although the amount of surface water available varies with rainfall and the capacity of the collection system, part of these land are favourably effected by Guayas Cuenca hydroelectric damp with about 2 billion dollars investment, Besides, each of these site has good . Surface water collection and delivery systems. The supply capacity for water sources at each site is adequate to meet the requirements of ethanol-crop production. Each of the ethanol biorefinery generates ethanol to be used for power generation in their regions. Electricity generation capacity will comfortably exceed electricity consumption on each plant housing the three candidate sites. The power distribution systems at the three sites for the plants can easily serve energy-crop production and ethanol conversion. Ground transportation on each plant relies on the existing system of highways. Each site is connected to the primary transportation network and is easily accessible to most areas of the coastal region of Ecuador, including airports and harbours. The agricultural land at each site is served by a complete road network which provides efficient transportation conditions for the biomass feedstock to reach the ethanol conversion facility. Each plant will house a selected biomass production site has at least one deep-draft harbour with facilities for cargo. The distance from each site to the nearest harbour or airport on the island ranges from ~around 50 miles. Closure of sugar plantations at the WSCo and HSC sites has idled valuable inventories of other supporting infrastructure, such as drainage systems, processing facilities, fabrication and maintenance shops, and warehouses. The infrastructure at each site will be well situated and equipped to serve a new biomassethanol industry. This is our Opportunity. With a rapidly growing market worldwide for ethanol and an abundant supply of low cost, cellulosic biomass available, Ecuador represents a significant 49

opportunity to develop ethanol production facilities based on cellulosic biomass. In addition, locating such facilities close to the fuel market will provide a transportation cost advantage. The performance advantages of biomass ethanol and the effect on employment will also be beneficial. Accordingly, as part of its business growth strategy, this project will undertake the development of the first cellulosic biomass-to-ethanol projects in Ecuador: Prepare by Wellington G. Gallardo, Financial Coordinator, Guayaquil, Ecuador. Telephone (593 4)2422511, Fax (593 4)2433825, cellular (593 9)0989502692, e-mail: finangallardo@hotmail.com

50