Market

 

We have entered a new era of fuel price volatility.  The classic benchmark for the cost of energy is the spot price for light sweet crude oil.  In the past two years this has moved between 50 and 150 USD per barrel.  These fluctuations are driven by increasing demand, but also in part to new technologies such as fracking

Energy forecasts anticipate a rapid growth in demand in the next 20 years.  When the current global recession is over, crude oil supply and demand will likely be closely matched once again.  As demand continues to increase driven by population growth and increasing standards of living, diesel and gasoline prices will escalate.  This is the economic driving force behind the customer need for alternative liquid fuels to power internal combustion engines           

This energy need can be partially satisfied with Bionit blends used in diesel engines in place of diesel fuel.  the cost basis of these blends allows a savings for the customer as well as an attractive return for the manufacturers.  Bionit provides other advantages including lower greenhouse gas emissions, a strengthened US dollar, reduced funds flow to terrorists, and the creation of a new industry with jobs and investment opportunities. 

Over 60 billion gallons of diesel fuel are used annually in the USA.  The Energy and Independence Security Act (EISA) of 2007 mandates an increased use of alternative renewable fuels to supplant the crude oil based fuels such as gasoline and diesel fuel.  Cellulosic biofuels derived from non-food sources are specified to grow from a small base next year to 12 billion gallons by 2022.  That mandate, along with the anticipated escalation of crude oil costs during that time period, creates a huge market opportunity for Bionit blends.     

The initial marketing strategy will be to identify and secure large single users/buyers that are able to convert a fleet of vehicles to the dedicated supply of Bionit.  Such key customers include city bus fleet conversion, military bases, and state or federal vehicle conversion.  Market development will include the identification of these potential customers and quantification of their needs in terms of volume, price and supply logistics.

Bionit derived from biomass and blended with methanol can be profitably sold at an energy equivalent discount to diesel or biodiesel.  The combination of customer cost savings and greenhouse gas emissions reduction will allow a penetration of the EISA mandated market.