Document:

exv10w13

 

Exhibit 10.13

	 	 	 	 	 
	

	 	AMERICAN	 	 
	 	ENGINEERING	 	 
	 	TESTING, INC,
	 	CONSULTANTS
	 

	 	 	 	•   GEOTECHNICAL
	 

	 	 	 	•   MATERIALS
	 

	 	 	 	•   ENVIRONMENTAL

October 19, 2006

MinnErgy, LLC — Renewable fuels

PO Box 186

Winona, MN 55987

	Attn: 	 	Dan Arnold/Ron Scherbring

	RE: 	 	Proposal for Geotechnical Services

Proposed Ethanol Plant

Eyota, MN

AET#11-03892

Dear Mr. Arnold / Mr. Scherbring,

Introduction

American Engineering Testing, Inc. is pleased to offer you subsurface exploration and
geotechnical review services for your Proposed Ethanol Plant in Eyota, MN. This proposal is being
submitted per your request of October 13, 2006. This letter is intended to define our scope of
work, and to present you with an estimate of our fee, the anticipated schedule and other
information regarding
our services.

Purpose of Study

The purpose of this geotechnical work is to explore the subsurface conditions at the site, and
based on our characterization of the obtained data, to prepare a geotechnical engineering report
presenting comments and recommendations to assist you and your design team in planning and
construction of the project.

Project Information 

We understand you are planning on building an approximately 1,000,000 gallon/year corn ethanol
production plant in Eyota, MN. The proposed plant site is situated on an approximately 2,000’ by
1,500’ tract of land which is currently utilized for agricultural crop production except for the
southern 1/4, which is heavily wooded.

The project will include the construction of grain storage tanks, exterior process tanks,
fermentation tanks, a process building, evaporation, distillation equipment, a rail road spur,
parking and drive areas. Based upon previous work we have performed on similar projects, we
anticipate soil bearing pressure for these structures supported on shallow frost depth spread
footings are on the order of 1(ksf) to 6 (ksf). Based upon the topographic information provided,
it appears the site generally slopes downward from the south approximately elevation 1290’ towards
the north to approximately elevation 1275’.

 

 

Background Information 

Base upon our three (3) preliminary soil borings, advanced in a diagonal, bisecting the site from
the southeast to the northwest corner on October 18, 2006, AET anticipates a general soil profiled
of lean clay topsoil, underlain by variable clayey and sandy alluvium deposits and weathered
bedrock deposits. It appears the bedrock at the site is Galena group formation, possibly Prosser
Limestone. The preliminary flight auger borings were obstructed on bedrock at a depth of between
5’ to 21.5’ below existing site grade, sloping down from the north to the south.

Scope of Services 

Field Work

Our proposed scope of field work includes advancing thirty-eight (38) soil borings at the site, as
indicated on the attached site sketch. Based upon our preliminary boring (PB) boring information
we estimate our borings will be between 5’ to 30’. deep.

The test borings will be sampled with a split-spoon sampler utilizing standard penetration test
methods per ASTM:D 1586. Our services will include arranging clearance of underground public
utilities through the Gopher State One Call System.

We assume that the proposed boring locations will be staked in the field by the project surveyor
and will be accessible to our truck mounted equipment which will require clearing the southern
1/4 of the site for access to our proposed boring locations.

Soil Laboratory Testing

Our services will include mechanical laboratory testing of selected soil samples to aid in judging
engineering properties of the soils. In this proposal we have budgeted $500.00 for geotechnical
laboratory testing. If conditions are encountered which indicate the laboratory program should be
expanded for proper evaluation, we will review the recommended tests and associated cost with you
prior to proceeding.

Engineering Report 

Following the field and laboratory work, a formal engineering report will be prepared and
submitted. This report will include logs of the test borings, the laboratory test results, a
review of engineering properties of the on-site soils, and our geotechnical engineering opinions
and recommendations regarding the following:

	•	 	Grading procedures to prepare the building areas for structural support, including comments on the suitability of the
on-site soils for reuse as fill

	•	 	Foundation types and depths, including allowable soil bearing capacity and estimates of foundation settlement

	•	 	Ground floor slab support, including recommendations on the need for a vapor or capillary water barrier

	•	 	Backfilling procedures with drain tile recommendations and estimates of lateral earth

 

 

	 	 	pressures

	•	 	Preparation of the subgrade for pavements and rail road spurs

	•	 	Pavement section thickness designs

	•	 	Comments on other items which may affect final performance or constructability, such as frost heave and
drainage considerations

The scope of work defined in this proposal is intended for geostructural purposes only. This
scope, is not intended to explore for the presence or extent of environmental
contamination at the site. However, we will note obvious contamination encountered which can be
detected by human sight or smell sensing.

Fees 

The scope of work defined in this proposal will be performed on a time and materials basis
according to our current schedule of fees. A short form copy of this schedule is attached. For the
scope of work described, we estimate a cost in the range of $13,000.00 to $17,000.00. 

In the event the scope of our work needs to be revised due to unanticipated conditions or for
proper evaluation, we will review such adjustments and the associated fees with you; and receive
your approval before proceeding.

Schedule

Weather permitting, we anticipate drilling operations can begin within about one (1) to two (2)
weeks after receiving authorization to proceed. Verbal results of the drilling activities can be
obtained shortly after completion of the drilling. We anticipate the geotechnical report can be
prepared within about one (1) to two (2) weeks after completion of the field work. We are available
to review special schedule needs with you.

Terms 

Our services will be performed per the attached “Service Agreement,” along with the “Subsurface
Boring Supplement.” Client and its authorized representatives agree that verbal authorization of
our services is formal acceptance of the terms and conditions contained herein.

Acceptance 

Please indicate your acceptance of this proposal by endorsing the enclosed copy and returning it to
us. The original proposal is intended for your records.

Remarks 

This proposal is valid for a period of 90 days.

We appreciate the opportunity to submit this proposal to you and look forward to working with you
on this project. If you have any questions regarding our services, or need additional information,
please do not hesitate to contact me.

 

 

Sincerely,

American Engineering Testing, Inc.

/s/ Alec J. Hovick

Alec J. Hovick

Manager — Rochester

Phone: (507) 281-3547

Fax:   (507) 281-4941

AJH:acl

Attachments

ACCEPTANCE:

	 	 	 	 	 
	Client:

	 	Minnergy
 

	 	 
	 
	 	 	 	 
	Authorized
	 	 	 	 
	Signature:

	 	/s/ Daniel H. Arnold
 

	 	 
	 
	 	 	 	 
	Typed Name:

	 	Daniel H. Arnold
	 	 
	 
	 	 	 	 
	Title:

	 	Chairman
	 	 
	 
	 	 	 	 
	Date:

	 	10/31/06exv10w14

 

Exhibit 10.14

BROOKFIELD RESOURCES INC.

P.O. Box 390374

Minneapolis, Minnesota 55439

Phone: 612-849-0650

November 28, 2006

Chris Arnold

MinnErgy, LLC.

870 68th

Minnesota City MN 55959

Dear Mr. Arnold:

	Re: 	 	Scope of Services and, Cost Estimate for Conducting Geophysical Surveys for the
MinnErgy Karst Feature Investigation, Eyota, Minnesota

Brookfield Resources Inc. (Brookfield Resources) appreciates this opportunity to provide you this
Scope of Services and Cost Estimate for conducting geophysical services to conduct a subsurface
investigation at the site of a planned ethanol production facility near Eyota, Minnesota. The
purpose of this investigation is to identify potential sinkholes in the area of the planned
facility and to characterize sinkholes that have been identified by their surface expression.

Background

MinnErgy, LLC has acquired a site approximately one mile west of Eyota, MN to construct a 100
million gallon per year ethanol production. The site is located in an area with shallow carbonate
bedrock (Prosser Limestone’ of the Galena Group). Seven sinkholes have been identified on or near
the property in the University of Minnesota Dept. of Geology & Geophysics / Minnesota Department of
Natural Resource Karst Feature Inventory Points database. The depth to bedrock in a test well
constructed in the northern part of the site was approximately 40 ft but the bedrock is likely
closer to the surface to the south of the test well.

Scope of Services

Resistivity Survey — Geophysical Investigation

	 	A.	 	Conduct surface geophysical surveys for the purpose of identifying potential sinkhole
locations. These surveys would be conducted to characterize the subsurface within and
immediately surrounding the footprint of the proposed buildings. Surveys conducted to
characterize the area of the proposed buildings and structures will include the two
identified sinkholes nearest to the proposed structures.

 

 

	 	B.	 	Develop interpretations of the geophysical data collected to identify the potential
locations of cavities or fractures that have the potential for developing into sinkholes.
	 
	 	C.	 	Report on the geophysical surveys conducted and interpretation results.

We are able to collect approximately 1,300 feet of resistivity data per day. It is estimated that
the data collection in the field will take five days for the building footprint area.

The data obtained from the resistivity survey will be processed with computer-aided inversion
software. The data will produce a 2D resistivity model of the subsurface geology. The models will
be displayed as color-coded profiles. The color-coded profiles will be processed and interpreted,
with a final report. submitted.

Estimated Costs

A separate cost estimate for the building footprint area is provided on the attached form.

The building footprint area is proposed to be investigated with resistivity imaging lines oriented
in north-south and east-west directions, and is estimated to require five field days.

Timeline

Brookfield Resources is prepared to begin work on the project as soon as Project Authorization is
received. A Final Report will be submitted two weeks after completion of fieldwork. Data results
will be discussed with appropriate parties as soon as it is processed so that other project tasks
are not delayed.

The schedule for collection of geophysical data may be affected by early winter weather. Brookfield
Resources has extensive experience in conducting geophysical surveys under adverse field
conditions, and is prepared to operate in these environments. If data quality is impacted by
adverse conditions, the Project Manager will be immediately notified.

Brookfield Resources appreciates the opportunity to propose on this work. Should you have any
questions or comments, please contact our office at (612) 379-3594.

	 	 	 	 	 
	Respectfully,

Brookfield Resources Inc.

 	 	 
	/s/ Roger Carpenter
 	 	 
	Roger Carpenter, P.G. 	 	 
	Principal Scientist 	 	 
	 

2

 

Estimated Cost Breakdown

Geophysical Survey — Building Footprint Area

Eyota, Minnesota

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Number of	 	Unit/Hourly	 	 
	 Description	 	Units	 	Rate	 	Total
	Estimated Fieldwork
	Sr. Geophysicist
	 	 	50	 	 	$	95.00	 	 	$	4,750.00	 
	Geophysicist
	 	 	50	 	 	$	60.00	 	 	$	3,000.00	 
	Geophysical Equipment
	 	 	5	 	 	$	250.00	 	 	$	1,250.00	 
	Misc. small hand tools
	 	 	5	 	 	$	10.00	 	 	$	50.00	 
	Mileage
	 	 	400	 	 	$	0.85	 	 	$	340.00	 
	 
	 	 	 	 	 	 	 	 	 	$	0.00	 
	 
	 	 	 	 	 	 	 	 	 	$	0.00	 
	 
	 	 	 	 	 	 	 	 	 	$	0.00	 
	 
	Estimated Sub-Total:
	 	 	 	 	 	 	 	 	 	$	9,390.00	 
	 
	Estimated Processing / Report Preparation
	Sr. Geophysicist
	 	 	24	 	 	$	95.00	 	 	$	2,280.00	 
	Geophysicist
	 	 	20	 	 	$	60.00	 	 	$	1,200.00	 
	Secretary/Clerical
	 	 	5	 	 	$	30.00	 	 	$	150.00	 
	Reproduction
	 	 	4	 	 	$	40.00	 	 	$	160.00	 
	 
	 	 	 	 	 	 	 	 	 	$	0.00	 
	 
	Estimated Sub-Total:
	 	 	 	 	 	 	 	 	 	$	3,790.00	 
	Estimated Expenses
	Hotel
	 	 	10	 	 	$	85.00	 	 	$	850.00	 
	Per Diem
	 	 	10	 	 	$	30.00	 	 	$	300.00	 
	Misc. expenses
	 	 	3	 	 	$	60.00	 	 	$	180.00	 
	 
	 	 	 	 	 	 	 	 	 	$	0.00	 
	 
	Estimated Sub-Total:
	 	 	 	 	 	 	 	 	 	$	1,330.00	 
	Estimated Grand Total:
	 	 	 	 	 	 	 	 	 	$	14,510.00	 

Prepared by Brookfield Resources Inc. for NRG, Inc.

16-Nov-06

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