S2G Biochemicals Inc

Crossing the Chasm to Commercialization Strategic Partnerships

2016 BIO Latin America Conference Sao Paulo, Brazil

October 27th, 2016 We Live in a Different World…

Health & Wellness It’s no longer a choice; we must achieve all three

Profitability Sustainability

Challenging for “green” technologies

2 S2G Vision…

Profitable High value-add projects for biorefinery Sustainable raw C5 sugars Sugar-free materials for sweetener for packaging and healthy snacks products and foods Partnerships are important to cross the chasm to commercial projects

3 S2G Biochemicals Inc.

 Founded in 2009  HO - Vancouver, Canada  Privately held  15 full-time/contract employees  Proprietary sugar conversion technology  Validated technology at pilot and commercial scales

Cost-effective and economical conversion technology for biochemicals

2 Co-production of Xylitol & Glycol

Non-food C5 sugars from biomass Hydrogen

Product Conditioning Catalytic Separations Hydrotreating • Remove • Production of contaminants from • Converts sugar to purified end crude sugar liquors xylitol & mix of products. or glycerol biochemical glycols • Drop in petrochemical replacements

Waste glycerol from biomass (optional) Co-production of Xylitol and Bio-glycols

5 S2G Xylitol & Bio-Glycol Process

 Breakthrough technology . Co-production of xylitol & bio-glycols • 4-year development program . Sustainable – profitable, carbon efficient, healthy. • $10+ million investment • Developed in partnership  Proven at pilot and commercial with Mondelēz International scale • Patent pending & ready for  Value-add conversion process commercialization for cellulosic sugars  US commercial project in development

6 7 Competitive Advantages

• Sugars from biomass residues Feedstock • Low cost – available sugars • Unique conditioning processes

• Highest xylitol recovery Yield • Highest carbon yield - glycol • Product mix can be adjusted

Co- • Biochemical glycols • Maximizes product yield from biomass products • Additional revenue and margin

Broad patent protection filed S2G has exclusive worldwide rights

8 Value Add – C5 Sugars

•Xylose • $3,000+/MT •$1500/MT •Arabinose Xylitol • 140,000 MT/yr Superior to Sorbitol •2,200,000 MT/yr •Glucose C5 • $0.6 B/yr •$4 B/yr •Mannose Liquors •Plus lignin, ash, etc. • Avg. $1,750/MT Propylene • 2,000,000 MT/yr Glycol • $4 B/yr

• Avg. $1,000/MT Ethylene • 15,000,000 MT/yr Glycol • $25 B/yr

• Competes with C6 sugars … or Ferment • Lower yield/higher cost • Value is capped burn

9 Commercial Plants

Large-scale, profitable projects

• 10,000  100,000+ MT/yr of C5 sugars • $20 million  $200+ million revenue • 33+% margin • 25+% unlevered margin • $50 million  $300 million capital

10 Strategy

Attract Strategic Partners & Investment

 Obtain off-take for products  Secure feedstock supply  Build scalable first commercial plant – Leverage existing assets  License/build follow-on facilities

11 Strategic Partnerships

 Global snack-food partner  Off-take partner  Specialty US chemical producer/operating partner  Existing infrastructure  Engineering partner to leverage Secure Supply & Offtake

 C5 Sugar Sources: . Pulp mills . Cellulosic Ethanol Plants . Biorefineries  Several NA existing sources identified  Feedstock supply commitments in progress  Xylitol offtake – Mondelēz  Glycol offtake – Local bio glycol market Scalable First Commercial Plant: Project “BlueBelle”

 Pennakem Site - Memphis, TN, USA  Existing infrastructure  Site of July 2016 commercial campaign  Leverage chemical process familiarity  Central mid-west location Timeline

2016 2017 2018 2019 2020

• Project • Engineering • Construction of • Startup • Startup Development • Demonstration 1st Plant Phase 1 Phase 2 • Expansion • Project Development 2nd Plant

15 Questions?

Kent Smith, P.Eng. Director, Projects [email protected]

S2G Biochemicals Inc. Vancouver, BC CANADA www.s2gbiochem.com [email protected]