January 9, 2006

Volkswagen, Shell and Iogen to consider producing cellulose ethanol

Detroit, Michigan – Volkswagen, Shell and Iogen Corporation announced that they will conduct a joint study to assess the economic feasibility of producing cellulose ethanol in Germany. This advanced biofuel produced by Iogen can be used in today’s cars and can cut CO2 emissions by 90% compared with conventional fuels.

Iogen’s cellulose ethanol is a fully renewable advanced biofuel made from the non-food portion of agriculture residue such as cereal straws and corn stover, and is one of the most cost-effective ways to reduce greenhouse gas emissions in road transport. Iogen’s cellulose ethanol technology is the result of more than 25 years of research and development. The company operates the world’s only cellulose ethanol demonstration-scale facility and made the first commercial shipments of this fuel in April 2004.

“We are strongly committed to reducing dependence on fossil fuels and are looking for the most effective approach to substitute these fuels by innovative biofuels. That is the only way we can cost effectively satisfy people’s individual mobility needs in the long term,” said the Chairman of the Board of Management of Volkswagen AG, Dr. Bernd Pischetsrieder.

All automotive manufacturers warrant the use of cellulose ethanol blends: 10% (E10) in North America and 5% (E5) in Europe. In 2003, the European Union issued a biofuel directive in response to anticipated shortages and rising costs of fossil fuels. The directive targets 5.75% biofuels by 2010. The US Energy Policy Act of 2005 introduced a nationwide renewable fuels standard (RFS) that will double the use of ethanol and biodiesel by 2012.

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