BUSINESS FUNDAMENTALS | American Energy

BUSINESS FUNDAMENTALS
A SPECIALIZED APPROACH IN A WELL-ESTABLISHED INDUSTRY TO FOCUS ON PUBLIC PURPOSE & NEEDS

AMERICAN ENERGY'S operating margins (profits) are inherently greater than traditional crude oil refinery margins (approximately $30 per barrel higher) - which are extremely profitable. That is because refineries such as those of Marathon and Sinclair (the only refineries that report operating margins and similar details as attested 10-K filings), use crude oil as feedstock whereas American Energy's plants use used motor oil as feedstock, which is purchased at about a $45 per barrel discount to WTI crude.

AMERICAN ENERGY has only 7 competitor plants in the U.S., with a capacity equal to less than 25% of the domestic feedstock available from used automotive motor oil, and even far less of the available domestic feedstock available in total (marine plus automotive, etc.). In fact, the U.S. used motor oil feedstock availability is only 27% of the total world UMO available. The additional processing capacity needed to meet domestic supplies is 65,000 bpd. To meet world-wide available UMO supplies requires over 245,000 bpd.

The low capacity (and subsequent applicable permitting governing rules) enables AMERICAN ENERGY to fast-track the permitting process by permit by rule.

Although analyses of past pricing history confirm that even without locking-in feedstock costs and offtake product pricing, the plants would have been highly profitable, to minimize risk AMERICAN ENERGY will be contracting both feedstock supply and offtake contracts at firm prices locking in profits Our company has the first 4,000 bpd (feedstock and offtake) under LOI and is in the processing of increasing the amounts of both.