Asslam-o-Alaikum

ENTREPRENEURSHIP BUSINESS PLAN

ETHANOL FUEL FASTER WAHAJ BBA FALL 09

ETHANOL FUEL FASTER

INTRODUCTON

PRODUCTION AND TECHNOLOGY PLAN

MARKETING PLAN FINANCIAL PLAN

ETHANOL FUEL FASTERE

RE-INTRODUCED:1. E-10 has been inaugurated in Pakistan by

Prime Minister’s Adviser for Petroleum Dr Asim Hussain accompanied by Minister for Industries Mian Manzoor Ahmad Wattoo.

2. Ethanol-mixed fuel will be sold at Rs2.4 per liter less than regular petrol.

ETHANOL FUEL FASTER

Energy in Different Fuels Can Have Very Different QualitiesFossil Energy Ratio (FER) = energy in fuel/fossil energy input

1.36

0.980.81

0.45

0.0

0.5

1.0

1.5

2.0

Cell. EtOH Corn EtOH Coal Gasoline Electricity

Increase in Energy Quality

ETHONAL FUEL FASTER

ETHANOL FUEL FASTER

ETHANOL FORMULA: Ethanol, also called ethyl alcohol, pure alcohol, grain

alcohol, drinking alcohol, volatile, flammable, colorless liquid.

Best known as the type of alcohol found in alcoholic beverages it is also used in thermometers as a solvent and as a fuel.

TECHNOLOGY PLAN

1. Pakistan is becoming ethanol producers.2. New technologies for producing ethanol

from agricultural, forestry,municipal wastes and residues are the focus of major research and development efforts around the world.

ETHANOL FUEL FASTER

ETHONAL FUEL FASTER Pakistan today has 4 largest coal reserves Pakistan

can greatly reduce its petrol consumption immediately by

1)Converting the Power Plants run on furnace oil into Indigenous coal based power plants.

2)Oil can be blended by 10 % ethanol immediately there by

bringing down the petrol consumption by atleast 30-40m ilion barrels per year

ETHANOL FUEL FASTER

Chemistry

Structure of ethanol molecule. All bonds are single bondsGlucose (a simple sugar) is created in the plant by

photosynthesis 6 CO2 + 6 H2O + light → C6H12O6 + 6 O2During ethanol fermentation glucose is

decomposed into ethanol and carbon dioxide. C6H12O6 → 2 CH3CH2OH+ 2 CO2 + heat

ETHANOL FUEL FASTER

During combustion ethanol reacts with oxygen to produce carbon dioxide, waterand heat:

CH3CH2OH + 3 O2 → 2 CO2 + 3 H2O + heatEthanol may also be produced industrially from ethene(ethylene). Addition of water to the double bond converts ethene to ethanol:C2H4 + H2O → CH3CH2OHThis is done in the presence of an acid which catalyzes the reaction, but is not consumed. The ethene is produced from petroleum by steam cracking

It is an alternative fuel made from plants that contain basic sugars.

The sugars are fermented and distilled into carbon dioxide and alcohol.

Ethanol is also a renewable fuel source because it comes from corn, barley and wheat stalks, which can be harvested and then replanted.

ETHANOL FUEL FASTER

ETHANOL FUEL FASTEREngine Problems Resulting from

E10 Ethanol Alcohol Fuel Use:  Ethanol will dissolve resins that create a black

sludge that coats and travels through the engine, causing engine stalling and complications, including clogged fuel filters, carburetor .

 Many engine hoses of older engines are not resistant to alcohol.

Higher alcohol extra release causes of rust, debris, sediment and gunk -  and further clogging and damage to engine components and filters.

PRODUCTION PLAN

ETHANOL FUEL FASTERProduction processThe basic steps for large scale production of ethanol are: 1. Microbial fermentation 2. Sugars distillation3. Dehydration 4. Hydrolysis Enzymes are used to convert starch into sugar.

ETHANOL FUEL FASTERMicrobial fermentation:Ethanol is produced by microbial fermentation

ofthe sugar. 1.Microbial fermentation will currently onlywork directly with sugars. 2.Two major components of plants, starch and cellulose, are both made up of sugars, and can converted to sugars for fermentation.

ETHANOL FUEL FASTER Sugars distillation:1.Sugar (e.g. sugar cane) and starch (e.g. corn)

portions can be economically converted. 2.The cellulose part of a plant is broken down to sugars and subsequent Distillation.3.For the ethanol to be usable as a fuel, the majority of the water must be removedMost of the water is removed by distillation

ETHANOL FUEL FASTERDehydration The ethanol is passed through an absorber containing a

molecular sieve which traps the ethanol but lets the water pass through. The result is a nearly 100% anhydrous ethanol product. Three absorbers may be used to enhance efficiency.

ETHANOL FUEL FASTER

Hydrolysis

The slurry temperature is raised to between 80 and 100 degrees centigrade to hydrolyze the starch into solution.

ETHANOL FUEL FASTER

FINANCIAL PLAN

TOTAL capital required Rs. 400 millionThe total capital requirement is an

estimatebased on the set up of Ethanol plant with the capacity of 30,000/- liters.

ETHANOL FUEL FASTER

ETHANOL FUEL FASTERPRICE PER LITER OF COMPETITORSN0. FUEL COUNTRY PRICE1 (Unleaded-

premium) PATROL

PKR (Pakistan Rupees)

88.95/L

2. ETHANOL FUEL

PKR (Pakistan Rupees)

80/L

3. (Unleaded-Hi Octane) PATROL

PKR(Pakistan Rupees)

112.65/L

4. Diesel PKR(Pakistan Rupees)

94.15/L

PKR 88.95/L (Unleaded Premium)PKR 112.65/L (Unleaded-Hi Octane)PKR 94.15/L (Diesel)

PRICE QUALITY MATRIX

LOW

HIGH

LOW QUALITY HIGH

PRICE

ETHANOL FUEL FASTER

ECONOMY PENETRATION

SKIMMING PREMIUM

ETHANOL FUEL FASTERSALE FORCASTING

particular 1year 2year 3year 4year 5year 1.sales 30000 3900000 3900000 3900000 3900000 3900000130 per litre2. subsidariy 1500000 1500000 1500000 1500000 150000050 per litre3. cost per costumers 2400000 2400000 2400000 2400000 240000080 per litre4. cost of good sold 1500000 1500000 1500000 1500000 150000050 per litre5. Gross profit 2400000 2400000 2400000 2400000 24000006. operating expense 300000 300000 300000 300000 30000020 percent 7.EBIT 2100000 2100000 2100000 2100000 21000008. INTEREST 0 0 0 0 09. DEPRECIATION 300000 300000 300000 300000 30000010. Net income 1800000 1800000 1800000 1800000 1800000

ETHANOL FUEL FASTER BALANCE SHEETS ASSETS 2012 ------------------------------ --------- Current Assets: 150000000 Cash and cash equivalents 50000000 Total current assets 200000000 --------- Other assets 50000000 --------- Total Assets 250000000 ========= LIABILITIES AND STOCKHOLDERS' EQUITY ------------------------------ Current Liabilities: Total current liabilities 50000000 --------- Total Liabilities 50000000 --------- Additional paid-in capital 50000000 --------- Ethanol, Inc. Stockholders' Equity (Deficit) 75000000 --------- Total Stockholders' Equity 75000000 --------- Total Liabilities and Stockholders' Equity 250000000 =========

ETHANOL FUEL FASTER

MARKET PLAN

ETHANOL FUEL FASTER

Market plan MARKET SHARE TARGET MARKET MARKETING STRATEGY MARKETING MIX SWOT ANALYSIS DISTRIBUTION CHANNELS

ETHANOL FUEL FASTERMarket research: Ethanol Research notes Ethanol used in transportation applications

reduces oil dependence and results in lower emissions.

1. Reducing the price gap between utilization of ethanol and cheap imported gasoline

2.Hydrated ethanol  can be used in a fuel cell system with no loss in efficiency compared with 100 % high-grade ethanol

ETHANOL FUEL FASTER

PRESENT STAGE :Question Marks – high growth rate

but low market share World’s ethanol production will pass 20 Bln

gallons in 2012. Ethanol production is expected to grow in

2008 - 2012 with CAGR about 5s U.S. and Brazil are leading the world in production of ethanol.

Emergence of new ethanol producers in Asia and Latin America.

ETHANOL FUEL FASTER

ETHANOL FUEL FASTER

AFTER FIVE YEARS :Stars – high growth rate and high market

shareFactors driving ethanol market:

High oil prices.Less quantity of oil National energy security considerations.Ethanol tax incentives. Improved technology - lower costs of

ethanol production.Climate change concerns.

ETHANOL FUEL FASTER

ETHANOL FUEL FASTER

ETHANOL FUEL FASTER

INITIATIVEETHANOL FUEL FASTER

ETHANOL FUEL FASTER

PRODUCT :E-10 PRICE:Ethanol-mixed fuel will be sold at Rs2.4 per liter less than

regular petrolPLACE:It will soon reach six major cities Islamabad, Lahore,

Karachi, Faisalabad, Quetta, Peshawar and Sukkur.PROMOTION : 20 pumps would start selling E-10 by August 14 this

year. Ethanol-mixed petrol was being used in more than 16 countries .10% of ethanol to save more money.

ETHANOL FUEL FASTER

Strength :1. Ethanol for use in automobiles in order to

reduce oil imports.2. Pakistan is initiating the use of ethanol as

an automotive fuelOpportunities:3. 5% to 10% ethanol in gasoline in Pakistan

to improve the environment and the security of energy supplies

4. In 2004, around 42 billion liters of ethanol were produced in the world, most of it being for use in cars.

ETHANOL FUEL FASTER

Weakness:1. Over 10% ethanol will cause damage to most

conventional engines.2. The percentage of ethanol contained in gas at

pumps is not closely monitored. Test Gas Ethanol Level

Threats1. E10 ethanol gasoline has caused engine

problems & damage, especially to older vehicles and marine outboard boat motors.

2. Many types of engines are not designed for the use of alcohol fuel. 

3. Price of CNG, LPG

ETHANOL FUEL FASTER

NEW PRODUCT

MARKETDEVELOPMENT STRATEGY

DIVERSIFICATION

CURRENTMARKET

ETHANOL FUEL FASTER

ETHANOL FUEL FASTER

SITUATION ANALYSISPROFIT

PEOPLE

PLANET

increase quality of lifeecosystem restoration

positive return on investment

45

Distribution channels Comparative Results Between Ethanol and Gasoline

ETHANOL FUEL FASTER

ETHANOL FUEL FASTER

BILL BOARD

ETHANOL FUEL FASTER

List of consumers :

Pak Suzuki Motor Company Ltd. Cars, L.C.Vs ,Pick-ups and Vans.

Indus Motor Company Ltd. Cars and L.C.Vs.

Honda Atlas Cars (Pakistan) Ltd. Cars and Bikes.

ETHANOL FUEL FASTER

Sind Engineering Ltd. Cars, Trucks , Bikes and Pick-ups.

Sigma Motors (Pvt) Ltd.

L.C.Vs

Hinopak Motors Ltd. Trucks and Buses.

Ghandhara Nissan Ltd. Trucks, Buses and Cars.

Master Motor Corporation Ltd. Trucks , Buses and Pick-ups.

ETHANOL FUEL FASTER

ETHANOSL FUEL FASTER