Experience and Expertise

Panda Ethanol has an accomplished senior management team with 25 years of average experience. The vast majority of the team came from Panda Energy, International, a private firm which has sited, financed, built and operated more than 9,000 MW of domestic and international electric generating capacity, including the two largest gas-fired merchant plants in the United States.

Strategic Locations

Panda Ethanol is developing a scalable model with strategically located "destination" ethanol sites. The advantages of these sites include:

• Proximity to ethanol markets in California, Texas and Colorado.
• Proximity to feedyards. Since Panda's biomass-fueled facilities are located near feedyards, the company doesn't have to dry its distillers grains. This allows the company to both eliminate the significant energy costs of drying the grains and secure a greater price for the more valuable (wet) product.
• Proximity to corn destination markets. Panda's feedstock costs are not as susceptible to droughts in any one particular corn market since the company has the ability to pull from multiple corn basins.
• Access to superior rail lines. Superior rail access allows for the efficient transport of feedstock and co-product materials and provides for speed to market.

Biomass Fuel Innovtion

Panda Ethanol's innovative use of biomass material in some of its planned ethanol facilities (at little or no cost) provides for many competitive advantages:

• It reduces these facilities' exposure to natural gas prices, which is the second largest variable cost for an ethanol plant.
• It provides these facilities with increased price certainty for the cost of fuel.
• It can provide the company with a significant cost advantage depending on the current prevailing price of natural gas.
• By utilizing cattle manure as a fuel source, Panda Ethanol is helping to address an environmental hazard by disposing of substantial amounts of decaying waste material.

Large-Scale, Low-Cost Business Model

Panda's plans to build ethanol facilities with a minimum annual capacity of 105 million gallons or more and to fuel those facilities, where possible, with biomass material allows the company to operate very efficiently.

In addition, Panda's use of a double-loop track at each of its planned facilities enables the company to unload a 110-car unit train of corn while simultaneously loading a 95-car unit train of ethanol. This allows Panda to efficiently process and transport its products.

Favorable Outlook

Ethanol is here to stay as a part of America's effort toward energy independence. Biofuels maintain strong bi-partisan political support which improves the staying power of the industry.