Mascoma Corporation

Renewable fuels are fuels produced from renewable resources such as plant biomass, in contrast to fuels produced from non-renewable sources such as crude oil and natural gas. The ability to create fuel from plant and non-plant biomass would help meet the increasing demand for renewable fuels to comply with governmental requirements and help reduce dependence on foreign oil imports.

As a result of our highly adaptable CBP technology platform, we intend to operate across the renewable fuels and chemicals industries, with a near-term focus on ethanol. The ethanol industry has grown significantly over the past several years. According to the Renewable Fuels Association, corn ethanol production increased from 3.4 billion gallons in 2005 to over 13 billion gallons in 2010 and ethanol exports in 2010 hit a record high of 350 million gallons. We believe this large and established industry presents a compelling need for our proprietary Mascoma Grain Technology, or MGT, yeast product, which is a genetically-modified yeast product that can be used by corn ethanol producers as a drop-in substitute to conventional yeast.

As the demand for biofuels continues to grow, we believe production will shift increasingly from food-based to non-food based sources. Virtually all the ethanol produced globally today is from edible sugar and starch sources, including corn in the United States and sugarcane in Brazil. While corn is expected to remain the primary feedstock for ethanol production in the United States in the near-term, there is an increasing push to produce ethanol and other biofuels from non-food plant materials. We believe there is a need for a low-cost, more sustainable fuel such as cellulosic ethanol, or second generation ethanol that is less volatile with respect to price and supply as compared to petroleum-based products, has lower greenhouse gas emissions, addresses concerns about depleting global food supplies and helps advance energy independence. We have used our CBP technology to convert hardwood pulpwood feedstock into cellulosic ethanol.

Replacing fossil fuel-based chemicals with chemicals derived from sustainable resources is another important component of the transition away from fossil fuels. Biomass feedstocks can be converted to organic chemicals that have the same characteristics as chemicals derived from fossil fuels such as petroleum, natural gas or coal. Through advanced development of its CBP platform technology, Mascoma expects to produce these primary petrochemicals using non-plant biomass feedstock.

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