Bergius Process

Zeecol Limited

Today Coal Liquefaction converts over 90% of carbon at 500C minimizing CO2 footprint. The Bergius process is a proven high pressure hydrogenation process that produces on-spec light hydrocarbons from by thermal cracking and hydrogen saturation in one process unit called the direct hydrogenation unit. The main reaction takes place in the Liquid Phase Reactors (LPH). Here a bubble column ow is established. This ensures maximum mixing to achieve high conversion. Typical reaction parameters are 450 - 490 C (840 - 910 F) and 200 - 300 bar (3,000 - 4,500 psi). Further treatment of the LPH products takes place in the integrated Gas Phase Reactors (GPH) where the light hydrocarbon products of the LPH get in contact with a xed bed catalyst to derive on-spec marketable liquid products. Unconverted products of the LPH are separated prior to the GPH section in the High Pressure Hot Separator and are recycled.

112 A Nayland Street" Christchurch, NZ 8081

The Bergius process in its most recent conguration !

Zeecol Limited

Table 1: Hydrogenation Plants in Germany 1927-1945 Site Leuna Bhlen Magdeburg

112 A Nayland Street" Christchurch, NZ 8081

Feed Lignite Coal Lignite Coal Lignite Coal Lignite Coal Lignite Coal Lignite Coal Hard Coal Hard Coal Hard Coal Residue Hard Coal Residue

LPH 200 bar 300 bar 300 bar 300 bar 700 bar 300 bar 300 bar 700 bar 700 bar 700 bar 700 bar 700 bar

GPH 200 bar 300 bar 300 bar 300 bar 300 bar 300 bar 300 bar 300 bar 300 bar 700 bar 700 bar 300 bar

Rate 600,000 t/yr 240,000 t/yr 230,000 t/yr 300,000 t/yr 200,000 t/yr 400,000 t/yr 200,000 t/yr 350,000 t/yr 500,000 t/yr 180,000 t/yr 50,000 t/yr 600,000 t/yr

Zeitz Wesseling Brx Gelsenkirchen Scholven Gelsenkirchen Horst Blechhammer Bottrop Ltzkendorf Plitz

Figure 1: Original drawings, Leuna plant 1924

Source: Die katalytische Druckhydrierung von Kohlen Teeren und Minerallen

Zeecol Limited

112 A Nayland Street" Christchurch, NZ 8081

Zeecol intends to produce 5,500 barrels of C380 marine fuel per week and 5,500 barrels of C180 marine fuel per week. This is 26 contracts for each type per month, FOB Lyttleton Harbour, Christchurch, NZ, at a site that was recently cleared following the February 2011 Earthquake.

BUSINESS FEASIBILITY STUDY - LYTTLETON HARBOUR

Market Viability -- Excellent The company is selling marine fuel to an existing marine fuel buyer at Lyttleton Harbour Christchurch New Zealand at market rates totaling 12% of current volumes. This !made in New Zealand" fuel is more highly prized than imported varieties. This distinction will continue if supplies from foreign shores are interrupted or reduced for any reason. Technical Viability -- Excellent. The company is using a direct hydrogenation process called the Bergius Process. This process was developed in 1911 by Frederich Bergius. The process was used in the 1920s by IG Farben throughout Germany to produce liquid fuels in competition with conventionally produced fuels. In 1932 Dr. Bergius received the Nobel Prize for his innovations in high pressure hydrogen. In the 1940s World War Two Germany used it to produce the bulk of its aviation fuel from coal after losing control of the Middle East and Russian oil elds. Following that war US President Harry Truman backed efforts to build Bergius reactors in Missouri in 1949. These facilities produced liquid fuels of superior quality at below market costs. This project continued to operate until shut down under Eisenhower"s National Energy Council, which was dominated by oil interests. In 2007 China Shenhua Energy Co (CSEC) initiated a program to make fuels from coal using the Bergius Process citing the superior quality, high yields and lower cost of this process. Business Model Viability -- Excellent.

Management Model Viability -- Excellent.

The decision points and decision matrix is clearly delineated and events are clearly recognized. Economic and Financial Model Viability -- Excellent. The returns offered investors are calculated based on substantial discounts from today"s market prices for fuel. Over the four year period of the investment prices are likely to rise improving values beyond those offered here. Exit Strategy Viability -- Excellent According to US Department of Energy Energy Information Association the price of fuels have doubled in the past three years. This trend is likely to continue due to structural difculties in the oil supply markets and capital markets. Any new supply of high quality fuels is highly valued as a consequence. Selling a proven annuity based on fuel sales to institutional buyers in New Zealand and Australia at the prices offered will likely take place quickly.

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The technique of selling oil instead of equipment and land is widely used in oil eld development. This isolates investors from environmental and other liabilities while providing assured revenues once product is made and selling into the market. The technique of segregating new technology from commodity sales while providing signicant returns made possible with the new technology has been very successfully applied by companies like Hughes who developed new deep drilling techniques in the 1920s. From 1920 through 1950 Hughes drilling techniques developed over 1/3 of the world"s newly produced reserves. Hughes never sold any equipment or services. Hughes continually improved his techniques and processes. Nevertheless, investors in Hughes oil drilling projects routinely made signicant prots following the very model used here.

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ONE PAGE PRO FORMA ZEECOL LIMITED 3545231 Entity Type:! ! ! ! ! ! Limited Liability Company

Registered Address 112a Nayland Street Sumner Christchurch 8081 Directors MOOK, William Harry 1912 Fourth Avenue Sw, Rochester MN 55902 Shareholdings Total Number of Shares:! ! !

Project Type:! Location:! Start:! ! First Delivery:!

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Off-take Contract:! Rate:! ! ! Projected Value:! Annual Sales:! ! Term:! ! !

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Carbon Source:! Rate:! ! ! Delivery:! ! Cost:! ! ! Term:! ! !

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Un-allocated Production Marine Fuel:! ! Projected Value:! Term:! ! ! 83,605 MT/yr $850/MT 30 years $800,024,930! @8% discount, 30 yrs $327,690,620! @20% discount, 4 yrs

Present Value:!(2015)! ! Present Value: (2011)! !

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! 1,000,000 ! ! ! ! Bergius Lyttleton Harbour August 1, 2011 August 1, 2015 Solid Energy 200,000 MT/yr Rail $8,000,000/yr 20 years Talley!s Group Ltd. 27,000 MT/yr $850.00/MT $22,950,000/yr 5 years

Zeecol Marine Fuel Specications

11 April 2012 $706.62 LSO380 $714.42 LSO180
112 A Nayland Street! Christchurch, NZ 8081

Zeecol Limited

BUNKER FUELS

Zeecol manufactures two grades of marine fuel: Low Sulphur Fuel Oil (LSO) 180 centistokes (CST) and LSO 380 CST. These fuels are made to meet market specications for these grades at its Lyttleton Harbour location to meet the needs of the worldwide market. The specications followed are those dened by the International Organization for Standardization in document ISO 8217:2005 (E) Petroleum products - Fuel (class F) - Specications of marine fuels. LSO 380: Specications generally conform with that for RMG 380. Approximate Kinematic Viscosity: At 50 C, max 380 cst. Flash point 60 C minimum. Pour point (upper) winter quality, 30 C maximum; summer quality, same. Ash 0.15 m/m maximum. Sulfur 1.5% maximum. Vanadium max 300 mg/kg. Aluminum plus silicon, 80 mg/kg max; water, 0.5% maximum. LSO 180: Specications generally conform with that for RME 180. Approximate Kinematic Viscosity: At 50 C, max 180 cst. Flash point 60 C minimum. Pour point (upper) winter quality, 30 C maximum; summer quality, same. Ash 0.10 m/m maximum. Sulphur, maximum 1.5%. Vanadium max 200 mg/kg. Aluminum plus siliicon, 80 mg/kg max. ; water, 0.5% maximum. Timing: Zeecol bunker price assessments in India reect the market value for futures at 1630 Mumbai time, for bunker fuel supplied 60 months ahead. If no market value can be assessed in Mumbai, then the market value for fuels at 1630 Singapore time for the day of the sale shall be used multiplied by 0.9821 Price: Prices are quoted in $/metric tonne. Typical Size: Typical size parcel assessed is 500 metric tons for 180CST and 380CST but can vary depending upon port, but generally there is a 300 metric tonne minimum. Delivery: Bunkers are assessed on either an ex-wharf or delivered basis which includes all barging costs. Zeecol assesses the open market rates for the chartering of dirty and clean tankers. Zeecol charges $/MT assessments equivalent to rates charged.