®
Industrial Use of Canola Oil
Opportunities and Challenges
Bill McNeill
The Dow Chemical Company
March, 2007
About Dow …
®
 A science and technology
leader with annual sales of
$49 billion
 Founded in 1897 by Herbert
H. Dow in Midland, Michigan
 Supplies more than 3,300
products to customers in
175 countries
 From 156 manufacturing
sites in 37 countries
 Employs 43,000 people
globally
WCM/March 22, 2007
Slide 2
®
The Dow Chemical Company
WCM/March 22, 2007
Slide 3
Serving Many Markets with Essential Solutions
Food/Food
Packaging
22%
Electronics/
Entertainment
3%
Building Maint/
Construction
11%
Home Care/
Improvement
10%
Miscellaneous
1%
Hydrocarbons
& Energy
12%
Water
Purification
2%
Health
3%
WCM/March 22, 2007
®
Automotive/
Transportation
9%
Personal/
Household Care
16%
Furniture/
Furnishings
4%
Paper/
Publishing
7%
Slide 4
Strategic Themes
®
Drive Financial
Discipline and Low
Cost to Serve
Set the Standard
for Sustainability
Invest for
Strategic Growth
Build a People Centric
Performance Culture
WCM/March 22, 2007
Slide 5
Changing The Game
®
Trends Driving Renewable Feedstocks
 High Cost and Volatile
Hydrocarbon Feedstocks
 Energy and Raw Material
Security
 Climate Change – Increasing
Cost of Carbon Emissions
 Sustainability – LOHAS
Consumer Segment
WCM/March 22, 2007
Slide 6
®
WCM/March 22, 2007
Slide 7
Soy Polyols
Soy Oil
®
FAME
+
Glycerine (by product)
Dow Technology
Polyol
+ Isocyanate
Polyurethanes
WCM/March 22, 2007
Slide 8
Better Performance
®
Better Moisture Resistance
Soy Polyol
Alternate Polyol
Enhanced Whiteness
Control Foam
Exposed Covered
WCM/March 22, 2007
Soy Foam
Exposed
Covered
Slide 9
Glycerine to Epichlorohydrin
®
Seed Oil
FAME
Epichlorohydrin + BPA
WCM/March 22, 2007
+
Glycerine (by product)
Epoxy Products
Slide 10
Renewable Project Risks to Manage
Raw Material Supply Conversion Technology
WCM/March 22, 2007
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Market Acceptance
Slide 11
Renewable Feedstock Options
Sugar & Starch
• Refined global commodity
• 150 MMT
• 12-25 ¢/lb
WCM/March 22, 2007
Fats & Oils
• Refined global commodity
• 150 MMT
• 15-40 ¢/lb
®
Biomass
• Crude Product
• Developing supply chain
• 100 Giga T
Slide 12
Conversion Technologies
®
Renewable Feedstocks
Gasification
Chemical Processes
Fermentation
Syngas
Alcohols
WCM/March 22, 2007
Ethanol
Ethylene
Chemicals
Polymers
Polyols
Epichlorohydrin
Propylene Glycol
Surfactants
Lubricants
Slide 13
Market Acceptance
Exact Replacements
®
Equivalent in Application
New Products
Now with Renewable Plastic
• Cost saving is driver
• Defend against new
competitors
• Expanded Offering
• Customer Validation
• Significant Improvement in
cost/performance required
• Customer Driven
Increasing Risk and Difficulty
WCM/March 22, 2007
Slide 14
Critical Issues

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


®
Business Strategy
Feedstock Availability/Cost
Various Feedstock Cost Scenarios
Drop in Replacement vs. New Product
Process Development Required
Platform vs. Single Molecule
Freedom to Practice Technology
Sustainable Differentiation
WCM/March 22, 2007
Slide 15
Chemicals from Renewable Feedstocks
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 Advantages






Potential Low Cost
Feedstock Diversification
Potential for Better Performance
Reduced Environmental Impact
Expanded Business Models
Growing Consumer Demand
 Challenges

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Complex Supply Chain
Distributed Business Model
Established Petrochemical Products
New Conversion Technologies
Coal
Cost, Cost, Cost
WCM/March 22, 2007
Slide 16
Changing the Game …
®
It Will Take Time 8th annual Bioplastics Conference, 6-7 Dec 2006, Frankfurt
by 2010 --- 0.9-1.6% of petroleum based plastics will be replaced with bioplastics,
by 2020 --- the percentage could be 1.25-2.5%.
2005 – 2008 --- global capacity for bioplastic increases from 360,000 to 600,000 t/yr
 150 MM Lbs PLA expansion vs. 19 Billion Lbs PE new capacity
 20 MM Lbs Soy Polyols vs. 12 Billion lbs of PO produced per year
 150,000 MT Glycerin-Based EPI Vs. 1,400,000 MT capacity
WCM/March 22, 2007
Slide 17
Changing the Game …
®
 Now
 First generation biofuels
 PDO
 PLA polymers
 1 – 5 years
 By-product glycerin to chemicals
 Seed oil-based Polyols
 Ethanol to olefins
 PHA, PHB polymers
 Butanol, Succinic Acid from sugar
 5 -10+ Years
 Second Generation Biofuels
 Bio-refineries, industrial chemicals
 Bio Engineered crops for chemicals
WCM/March 22, 2007
Slide 18
®
Thank you!
Questions.
WCM/March 22,
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