? Key Industry Engineering Group - GDiesel: ClearRefining Manufacturing Process

ClearRefining® Manufacturing Process

Brief Process Description

Primary business model

Involves purchase of regular (EN 590 type) diesel fuel (as raw material) in the EU market for further processing into GDiesel®. The diesel is stored in the Company's own storage tanks.

The diesel together with natural gas (both being raw materials in the process) are fed into ClearRefining Processor/(s) where a catalytic process takes place involving high temperature and high pressure. During the process the regular diesel and part of the natural gas, with the help of specially designed catalysts, are transformed into much improved GDiesel® product. The process is fully automated, and requires minimum human involvement. The final product is then drained from the processor and stored in tanks ready for sale. There are no limitations involving the product's shelf life.

Under this model of operation KIEG will be categorized as a fuel producer, thus this model requires payment of all due taxes in the Czech Republic, including excise tax levied on the additional volume of final diesel produced. Special fuel producer license and bonded warehouse status are also required.

The operation also requires raising working capital (e.g. bank loan) for the purchase of raw materials (regular diesel and natural gas).

Alternative business model

Involves transport companies and/or other significant end-users of diesel fuel, which provide their existing fuel stock to KIEG for processing into the improved GDiesel®. In this scenario, KIEG only provides processing as a service to the client against a service fee.

The additional fuel volume produced as a result of the service is retained by the customer against the payment of the service fee. In this case, the relevant excise tax payment is the client's obligation.

Alternatively, KIEG takes possession of the additional fuel produced as well as the associated excise/tax obligations.

The operation requires raising working capital (e.g. bank loan) for the purchase of natural gas.

Closed-loop – Near Zero Emission Process

Step 1

– Reaction tank containing proprietary catalyst technology mixes heated ULSD with natural gas to form a vapor under the boiling point of ULSD at 10 psi pressure.

– The catalysts break the longer diesel hydrocarbon chains at their weakest points forming a lighter diesel product with improved combustion and emissions characteristics and a slight liquid volume expansion

Step 2

– After the catalytic process, the diesel and natural gas vapors pass through heat exchangers forming a condensed vapor and liquid phase.

Step 3

– The condensed vapor and liquid phase enters the Product Tank in which the remaining vapors condense and GDiesel® drops to the bottom.

– The remaining natural gas is circulated back from the product tank into the reaction tank through a vacuum blower.

Operates at safe and efficient low pressure and low temperature conditions.

Liquid volume expansion from process reduces already low operating costs.