!



 

"  
# 
$ 

%
 

&   
 
' 
()
$ 
 
# 
# 
)(*+,
$

 


 


   

 
-
. 
  
 
/ 
0 

/
.

  
.
 
-
1+(2
"  
# 
$ 

%
 

&   
 
' 
ϭ
 &RQWHQWV
&KDSWHU &RQWHQWV 3DJH1R

 ,QWURGXFWLRQWRDQLPDOFHOOFXOWXUHWHFKQRORJ\
,QWURGXFWLRQ
/DERUDWRU\HTXLSPHQW
6DIHW\$VSHFWVRI&HOO&XOWXUHDQG%LRVDIHW\OHYHOV
6RXUFHVRI&HOO/LQHV
7\SHVRI&HOO&XOWXUH
7KH&HOO(QYLURQPHQW LQFOXGLQJW\SHVRIFXOWXUHPHGLXP 


%DVLFSULQFLSOHV
,QWURGXFWLRQ
%LRORJ\RIFHOOVLQFXOWXUH
&KRLFHRIPDWHULDOV
3URFHGXUHV
5HIHUHQFHV

 6FDOHXSRIDQLPDOFHOOFXOWXUH
,QWURGXFWLRQ
*HQHUDOPHWKRGVDQGFXOWXUHSDUDPHWHUV0RQROD\HU
FXOWXUH
6XVSHQVLRQFXOWXUH
,PPRELOL]HGFXOWXUHV
5HIHUHQFHV

 &HOOOLQHSUHVHUYDWLRQDQGDXWKHQWLFDWLRQ
,QWURGXFWLRQ
&HOOOLQHEDQNLQJ
&HOOIUHH]LQJDQGTXDQWLWDWLRQRIUHFRYHU\&HOOOLQH
DXWKHQWLFDWLRQ
5HIHUHQFHV

 6HUXPIUHHPHGLD
,QWURGXFWLRQ
5ROHRIVHUXPDQGRWKHUXQGHILQHGWLVVXHH[WUDFWVLQFHOOFXOWXUHV\VWHPV
5HVSRQVHFXUYHV3UROLIHUDWLQJFXOWXUHV
$QWLPLFURELDOVSKHQROUHG+(3(6DQGOLJKW
3XULW\RIFRPSRQHQWV

Ϯ
 )DWW\DFLGV
5HIHUHQFHV

 7KUHHGLPHQVLRQDOFXOWXUH
,QWURGXFWLRQ
0XOWLFHOOXODUWXPRXUVSKHURLGV 0&76 ([SHULPHQWDO
WLVVXHPRGHOOLQJ

 %LRPDWHULDO
,QWURGXFWLRQWR%LRPDWHULDOV
6XEMHFWVLPSRUWDQWWR%LRPDWHULDOV6FLHQFH
6\QWKHWLF3RO\PHUVDV%LRPDWHULDOV
1RQELRGHJUDGDEOH3RO\PHUV
%LRGHJUDGDEOH3RO\PHUV
%LRORJLFDOPDWHULDOV
3RO\VDFFKDULGHV
0HWDOOLFPDWHULDOVDV%LRPDWHULDOV
&HUDPLFVDV%LRPDWHULDOV
6XFFHVVDQG)DLOXUHVZLWK%LRPDWHULDOVDQG0HGLFDO'HYLFHV

 7LVVXHHQJLQHHULQJ
,QWURGXFWLRQ
'HVLJQVWDJHVIRUWLVVXHHQJLQHHULQJ
&HOOVXEVWUDWHVDQGVXSSRUWPDWHULDOV
&HOOVRXUFHV
2ULHQWDWLRQ

 &\WRWR[LFLW\DQGYLDELOLW\DVVD\V
,QWURGXFWLRQ
%DFNJURXQG
6SHFLILFWHFKQLTXHV
(QGSRLQWV
$VVD\FRPSDULVRQV
3LWIDOOVDQGWURXEOHVKRRWLQJ

 *HQHWLFPRGLILFDWLRQ
,QWURGXFWLRQ
7UDQVIHFWLRQ
0LFURFHOOPHGLDWHGFKURPRVRPHWUDQVIHU

ϯ
 ,UUDGLDWLRQIXVLRQJHQHWUDQVIHU
5HIHUHQFHV

 6WHP&HOOV
6WHP&HOO
3URSHUWLHV
3RWHQF\
%DVLFSULQFLSOHVIRULGHQWLILFDWLRQDQGSXULILFDWLRQRIVWHPFHOOV
(PEU\RQLFVWHPFHOOV
)HWDOVWHPFHOOV
$GXOW6WHP&HOOV
5HVHDUFKZLWKVWHPFHOOV
6WHPFHOOFKDUDFWHUL]DWLRQE\LPPXQRF\WRFKHPLVWU\
6WHPFHOOFRQWURYHUV\

 $SSOLFDWLRQVDQG(FRQRPLF,PSOLFDWLRQV
RI$QLPDO%LRWHFKQRORJ\
,QWURGXFWLRQ
*OREDODGYDQWDJHIURPOLYHVWRFNRIGHYHORSLQJ&RXQWULHV
(FRQRPLFLPSDFWRIWHFKQRORJLHV
7UDQVJHQLFV
&KDUDFWHULVLQJJHQHWLFYDULDELOLW\
5HSURGXFWLYHWHFKQRORJLHV
,PSURYLQJKHDOWKWKURXJKGHYHORSLQJYDFFLQHV
'LDJQRVWLFVDQGHSLGHPLRORJ\
1XWULWLRQDQGIHHGXWLOLVDWLRQ
%XLOGLQJFDSDFLW\
)XQGLQJWRLPSOHPHQWWHFKQRORJ\
&RQFOXVLRQV

 &ORQLQJ
1XFOHDUWUDQVIHU
1XFOHDUUHSODFHPHQW
&ORQLQJRI'ROO\
(QGRI'ROO\
'ROO\¶VSUREDELOLW\
&DQ'ROO\KHOS-LPP\&KULVWLQHDQG0DUJR"6XPPDU\
'ROO\&ORQLQJ

 ,QYLWUR)HUWLOL]DWLRQ
,QWURGXFWLRQ

ϰ
 ,QYLWUR)HUWLOL]DWLRQ ,9) 
'RQRU6SHUP(JJVDQG(PEURV
6XUURJDF\*HVWDWLRQDO&DUULHU
6WHSVLQWKH,9)(73URFHVV
5LVNVRI$57
3UHSDUDWLRQIRU$57
6HOHFWLQJDQ$573URJUDP
6XFFHVVRIWKH3URJUDP
:KHQWRHQGWUHDWPHQW
,QYLWURIHUWLOL]DWLRQLQ,QGLD
&RQFOXVLRQ

 *HQHWKHUDS\
,QWURGXFWLRQ
6RPDWLF*HQH7KHUDS\
*HUP&HOO*HQH7KHUDS\
$GPLQLVWHULQJJHQHWKHUDS\
&OLQLFDOWULDOV
0DUNHWLQJDSSURYDO
,VVXHV
7HFKQLFDOFRQVLGHUDWLRQV
5HJXODWRU\FKDOOHQJHV
)XWXUHSURVSHFWVDQGH[SHFWDWLRQV
2YHUYLHZ

 *HQHNQRFNRXW
,QWURGXFWLRQ
.QRFNRXW0HWKRGRORJ\
.QRFNRXWDQLPDOV


$QLPDOVIRU+XPDQ+HDOWK3XUSRVHV
,QWURGXFWLRQ
%LRSKDUPDFHXWLFDO3URGXFWLRQ
&RQWDPLQDWLRQRU6SUHDGRI1RYHO3DWKRJHQV
(QVXULQJ&RQILQHPHQWRI8QZDQWHG$QLPDOV
%LRPHGLFDODSSOLFDWLRQV
7R[LFLW\
)DUPLQJ
3RWHQWLDODQLPDOZHOIDUHEHQHILWV

3LVFLWHFKQRORJ\DQGDTXDWLFELRWHFKQRORJ\
)LVKHULHV
ϱ
 *HQHUDOWHFKQRORJ\IRU)LVKSURSDJDWLRQ
3UDFWLFDOWHFKQRORJLHVRIWKHDUWLILFLDOSURSDJDWLRQRIFXOWLYDWHG)LVK
VSHFLHV
$TXDFXOWXUH
)LVK&\WRJHQHWLFV
$TXDWXUHELRWHFKQRORJ\
*HQHWLFHQJLQHHULQJ
$UWLILFLDOSURSDJDWLRQIRU&KURPRVRPHPDQLSXODWLRQ

 $SLFXOWXUH
%HHNHHSLQJ
1DWXUDO%HHNHHSLQJ
%HHFRORQLHV
)RUPDWLRQRIQHZFRORQLHV
'LVUXSWLRQRIYLWHOORJHQLQJHQHIXQFWLRQLQDGXOWKRQH\EHHV
5HIHUHQFHV


3HDUO&XOWXUH
3HDUO
'HILQLWLRQRIDSHDUO
3K\VLFDOSURSHUWLHV
)UHVKZDWHUDQGVDOWZDWHUSHDUOV
&UHDWLRQRIDSHDUO
1DWXUDOSHDUOV
&XOWXUHGSHDUOV
'HYHORSPHQWRISHDUOIDUPLQJ
3HDUOVDQGFDOFDUHRXVFRQFUHWLRQVIURPRWKHUVSHFLHV
*HPRORJLFDOLGHQWLILFDWLRQ
5HFHQWSHDUOSURGXFWLRQ
3HDUOVLQMHZHOU\

 6HULFXOWXUHDQG6HULWHFKQRORJ\
6HULFXOWXUH
6LONZRUP5HDULQJ
3URGXFWLRQ
3URSHUWLHV
%LRFKHPLVWU\RIVLONZRUP
$SSOLFDWLRQVRI6HULFLQDQGILEURLQSURWHLQ
3K\VLFDOPDSRI%RPE\[PRUL
5HJXODWLRQRIVLONHQFRGLQJJHQHV
7UDQVJHQLF6LONZRUP
5HIHUHQFHV

ϲ
 


&KDSWHU

,QWURGXFWLRQWR$QLPDOFHOOFXOWXUHWHFKQRORJ\

,QWURGXFWLRQ

&XOWXULQJRIDQLPDOFHOOVRXWVLGHWKHWLVVXH LQYLWUR IURPZKLFKWKH\ZHUHREWDLQHGLV
WKHSURFHVVRIDQLPDOFHOOFXOWXUH$QLPDOFHOOFXOWXULQJLVFDUULHGRXWXQGHUVWULFWODERUDWRU\
FRQGLWLRQV RI DVHSVLV VWHULOLW\ DQG FRQWUROOHG HQYLURQPHQW LQYROYLQJ SK\VLFRFKHPLFDO
SDUDPHWHUVPLPLFLQJWKHLQYLYRHQYLURQPHQWVRWKDWWKHFHOOVVKDOOVXUYLYHDQGSUROLIHUDWHLQ
DFRQWUROOHGPDQQHU7KHRUHWLFDOO\FHOOVRIDQ\W\SHFDQEHFXOWXUHGXSRQSURFXUHPHQWLQD
YLDEOHVWDWHIURPDQ\RUJDQRUWLVVXH+RZHYHUDOOW\SHVRIFHOOVDUHQRWFDSDEOHRIVXUYLYDO
LQ VXFK DQ DUWLILFLDO HQYLURQPHQW PHGLD  EHFDXVH RI PDQ\ UHDVRQV RQ ZKLFK WKH DUWLILFLDO
HQYLURQPHQWPD\IDLOWRPLPLFWKHELRFKHPLFDOSDUDPHWHUVRIWKHVRXUFHHQYLURQPHQW7KHVH
SDUDPHWHV LQFOXGH WKH DEVHQFH RI JURZWK UHJXODWRUV FHOO WR FHOO VLJQDO PROHFXOHV HWF $Q
DUWLILFLDOHQYLURQPHQW PHGLD FRPSULVHVDQDSSURSULDWHVRXUFHRIHQHUJ\IRUWKHFHOOVZKLFK
WKH\FDQHDVLO\XWLOL]HDQGFRPSRXQGVZKLFKUHJXODWHWKHFHOOF\FOH$W\SLFDOPHGLDPD\RU
PD\ QRW FRQWDLQ VHUXP %RWK W\SHV RI PHGLD KDYH WKHLU RZQ VHWV RI DGYDQWDJHV DQG
GLVDGYDQWDJHV8QGHURSWLPDOFRQGLWLRQVRIPDLQWHQDQFHWKHFHOOFXOWXUHHVWDEOLVKHGFDQEH
VXEFXOWXUHG SDVVDJLQJ XQWLODSXUHFXOWXUHRIVSHFLILFFHOOW\SHLVREWDLQHG7KLVVKRXOGEH
UHSHDWHGWRPDLQWDLQDVDFHOOOLQH$VDPDWWHURIIDFWFHOOOLQHVIURPFDQFHURXVWLVVXHVKDYH
DOVR EHHQ HVWDEOLVKHG 7KH SUHVHQFH RIH[FHVV JURZWK UHJXODWRUV RU RWKHU IDFWRUV PD\ RIWHQ
UHQGHU WKH FHOOV WR XQGHUJR UDSLG XQFRQWUROOHG SUROLIHUDWLRQ UHVXOWLQJ LQ D FDQFHURXV VWDWH
*RRGH[DPSOHVRIHVWDEOLVKHGFHOOOLQHVDUH+H/D%+.9HUR&+2HWF$QLPDOFHOOFXOWXUH
FDQEH H[SORUHGDSRWHQWLDOWRROLQGUXJWHVWLQJSULRU WR LWVXVDJH RQ DQLPDOV SURGXFWLRQ RI
WKHUDSHXWLFDOO\VLJQLILFDQWELRORJLFDOFRPSRXQGVOLNHKRUPRQHVDQGSURWHLQVRQDQLQGXVWULDO
VFDOHKDVEHHQPDGHVLPSOHUIDVWHUDQGPRUHHIILFLHQWE\WKHXVHRIFHOOOLQHVLQWKHSODFHRI
WKH OLYLQJ DQLPDO WKHPVHOYHV SURGXFWLRQ RI YDFFLQHV DJDLQVW PDQ\ YLUDO LQIHFWLRQV DQG
GLVHDVHVVWXGLHVRQUHJHQHUDWLYHPHGLFLQHDFWLYHUHVHDUFKRQVWHPFHOOFXOWXUHSUROLIHUDWLRQ
OHDGLQJ WR RUJDQRJHQHVLV $QLPDO FHOO FXOWXUH DOVR ILQGV DSSOLFDWLRQ LQ WKH SUHVHUYDWLRQ RI
KLJKO\ YDOXDEOH FRUG EORRG FHOOV ZKLFK DUH QRWKLQJ EXW VWHP FHOOV VSHFLILF WR DQ LQGLYLGXDO
DQGDOVRLQDVVLVWHGFRQFHSWLRQ

7KHKLVWRULFDOGHYHORSPHQWDQGPHWKRGVRIFHOOFXOWXUHDUHFORVHO\LQWHUUHODWHGWRWKRVH
RI WLVVXH FXOWXUH DQG RUJDQ FXOWXUH $QLPDO FHOO FXOWXUH EHFDPH D FRPPRQ ODERUDWRU\
WHFKQLTXHLQWKHPLGVEXWWKHFRQFHSWRIPDLQWDLQLQJOLYHFHOOOLQHVVHSDUDWHGIURPWKHLU
RULJLQDOWLVVXHVRXUFHZDVGLVFRYHUHGLQWKHWKFHQWXU\

7KH WKFHQWXU\ (QJOLVK SK\VLRORJLVW 6\GQH\ 5LQJHU GHYHORSHG VDOW VROXWLRQV
FRQWDLQLQJ WKH FKORULGHV RI VRGLXP SRWDVVLXP FDOFLXP DQG PDJQHVLXP VXLWDEOH IRU
PDLQWDLQLQJ WKH EHDWLQJ RI DQ LVRODWHG DQLPDO KHDUW RXWVLGH RI WKH ERG\ ,Q  :LOKHOP

ϳ

5RX[UHPRYHGDSRUWLRQRIWKHPHGXOODU\SODWHRIDQHPEURQLFFKLFNHQDQGPDLQWDLQHGLWLQD
ZDUP VDOLQH VROXWLRQ IRU VHYHUDO GD\V HVWDEOLVKLQJ WKH SULQFLSOH RI WLVVXH FXOWXUH 5RVV
*UDQYLOOH+DUULVRQZRUNLQJDW-RKQV+RSNLQV0HGLFDO6FKRRODQGWKHQDW<DOH8QLYHUVLW\
SXEOLVKHGUHVXOWVRIKLVH[SHULPHQWVIURPHVWDEOLVKLQJWKHPHWKRGRORJ\RIWLVVXH
FXOWXUH
&HOOFXOWXUHWHFKQLTXHVZHUHDGYDQFHGVLJQLILFDQWO\LQWKHVDQGVWRVXSSRUW
UHVHDUFKLQYLURORJ\*URZLQJYLUXVHVLQFHOOFXOWXUHVDOORZHGSUHSDUDWLRQRISXULILHGYLUXVHV
IRUWKHPDQXIDFWXUHRIYDFFLQHV7KH6DONSROLRYDFFLQHZDVRQHRIWKHILUVWSURGXFWVPDVV
SURGXFHGXVLQJFHOOFXOWXUH WHFKQLTXHV 7KLV YDFFLQH ZDV PDGH SRVVLEOHE\WKH FHOOFXOWXUH
UHVHDUFKRI-RKQ)UDQNOLQ(QGHUV7KRPDV+XFNOH:HOWHUDQG)UHGHULFN&KDSPDQ5REELQV
ZKR ZHUH DZDUGHG D 1REHO 3UL]H IRU WKHLU GLVFRYHU\ RI D PHWKRG RI JURZLQJ WKH YLUXV LQ
PRQNH\NLGQH\FHOOFXOWXUHV

/DERUDWRU\HTXLSPHQWLQDQLPDOFHOOFXOWXUHWHFKQRORJ\
/DERUDWRU\'HVLJQ
7KHPRVWXQGHUUDWHGDVSHFWRIFHOODQGWLVVXHFXOWXUHLVWKHQHHGWRGHVLJQWKHIDFLOLW\
WR HQVXUH WKDW D JRRG TXDOLW\ PDWHULDO LV SURGXFHG LQ D VDIH DQG HIILFLHQW PDQQHU 7LVVXH
FXOWXUHLVXQGHUWDNHQLQODERUDWRULHVWKDWKDYHEHHQDGDSWHGIRUWKHSXUSRVHDQGLQFRQGLWLRQV
WKDW DUH QRW LGHDO +RZHYHU VLQFH D IHZ EDVLF JXLGHOLQHV DUH DGRSWHG WKLV VKRXOG QRW
FRPSURPLVHWKHZRUN
7KHUHDUHVHYHUDODVSHFWVWRWKHGHVLJQRIDJRRGWLVVXHFXOWXUHIDFLOLW\,GHDOO\ZRUN
VKRXOGEHFRQGXFWHGLQDVLQJOHXVHIDFLOLW\ZKLFKLIDWDOOSRVVLEOHVKRXOGEHVHSDUDWHGLQWR
DQ DUHD UHVHUYHG IRU KDQGOLQJ QHZO\ UHFHLYHG PDWHULDO TXDUDQWLQH DUHD  DQG DQ DUHD IRU
PDWHULDOZKLFKLVNQRZQWREHIUHHRIFRQWDPLQDQWV PDLQWLVVXHFXOWXUHIDFLOLW\ ,IWKLVLV
QRW SRVVLEOH ZRUN VKRXOG EH VHSDUDWHG E\ WLPH ZLWK DOO PDQLSXODWLRQV RQ FOHDQ PDWHULDO
EHLQJ FRPSOHWHG EHIRUH PDQLSXODWLRQV LQYROYLQJ WKH µTXDUDQWLQH PDWHULDO¶ 'LIIHUHQW
LQFXEDWRUV VKRXOG DOVR EH GHVLJQDWHG 7KH ZRUN VXUIDFHV VKRXOG EH WKRURXJKO\ FOHDQHG
EHWZHHQDFWLYLWLHV$OOQHZPDWHULDOVKRXOGEHKDQGOHGDVµTXDUDQWLQHPDWHULDO¶XQWLOLWKDV
EHHQ VKRZQ WR EH IUHH RI GLIIHUHQW PLFURELDO FRQWDPLQDQWV SDUWLFXODUO\ P\FRSODVPD 
3HUIRUPLQJ WLVVXH FXOWXUH LQ D VKDUHG IDFLOLW\ UHTXLUHV FRQVLGHUDEOH SODQQLQJ DQG LW LV
HVVHQWLDO WKDW D JRRG WHFKQLTXH LV XVHG WKURXJKRXW WR PLQLPL]H WKH ULVN RI PLFURELDO
FRQWDPLQDWLRQ
)RUPRVWFHOOOLQHVWKHODERUDWRU\VKRXOGEHGHVLJQDWHGWRDWOHDVW&DWHJRU\EDVHGRQ
WKH $GYLVRU\ &RPPLWWHH RQ 'DQJHURXV 3DWKRJHQV $&'3  JXLGHOLQHV $&'3  
+RZHYHUWKHSUHFLVHFDWHJRU\UHTXLUHGLVGHSHQGHQWXSRQWKHFHOOOLQHDQGWKHQDWXUHRIWKH
ZRUN SURSRVHG 7KH JXLGHOLQHV PDNH UHFRPPHQGDWLRQV UHJDUGLQJ WKH ODERUDWRU\
HQYLURQPHQW LQFOXGLQJ OLJKWLQJ KHDWLQJ WKH W\SH RI ZRUN VXUIDFHV DQG IORRULQJ DQG
SURYLVLRQRIKDQGZDVKIDFLOLWLHV,QDGGLWLRQLWLVUHFRPPHQGHGWKDWODERUDWRULHVVKRXOGEH
UXQDWDLUSUHVVXUHVWKDWDUHQHJDWLYHWRFRUULGRUVWRFRQWDLQDQ\ULVNVZLWKLQWKHODERUDWRU\
0LFURELRORJLFDO6DIHW\&DELQHWV
$ PLFURELRORJLFDO VDIHW\ FDELQHW LV SUREDEO\ WKH PRVW LPSRUWDQW SLHFH RI HTXLSPHQW
EHFDXVH ZKHQ RSHUDWHG FRUUHFWO\ LW ZLOO SURYLGH D FOHDQ ZRUNLQJ HQYLURQPHQW IRU WKH
SURGXFW ZKLOVW SURWHFWLQJ WKH RSHUDWRU IURP DHURVROV ,Q WKHVH FDELQHWV RSHUDWRU DQGRU
SURGXFW SURWHFWLRQ LV SURYLGHG WKURXJK WKH XVH RI +(3$ KLJK HIILFLHQF\ SDUWLFXODWH DLU 
ILOWHUV 7KH OHYHO RI FRQWDLQPHQW SURYLGHG YDULHV DFFRUGLQJ WR WKH FODVV RI FDELQHW XVHG

ϴ

 &DELQHWVPD\EHGXFWHGWRDWPRVSKHUHRUUHFLUFXODWHGWKURXJKDVHFRQG+(3$ILOWHUEHIRUH
SDVVLQJWRDWPRVSKHUH


)LJXUH'LDJUDPRIPLFURELRORJLFDOVDIHW\FDELQHWDLUIORZSDWWHUQV

(QYLURQPHQWDO PRQLWRULQJ ZLWK 7U\SWRVH 6R\D %URWK DJDU VHWWOH SODWHV LQVLGH WKH
FDELQHWIRUDPLQLPXPRIIRXUKRXUVVKRXOGEHDJRRGLQGLFDWRURIKRZFOHDQDFDELQHWLV
7KHUHVKRXOGEHQREDFWHULDORUIXQJDOJURZWKRQVXFKSODWHV
,Q PRVW FDVHV D FODVV ,, FDELQHW LV DGHTXDWH IRU DQLPDO FHOO FXOWXUH +RZHYHU HDFK
VWXG\PXVWEHDVVHVVHGIRULWVKD]DUGULVNDQGLWLVSRVVLEOHWKDWDGGLWLRQDOIDFWRUVVXFKDVD
NQRZQ YLUXV LQIHFWLRQ RU DQ XQFHUWDLQ SURYHQDQFH PD\ UHTXLUH D KLJKHU OHYHO RI
FRQWDLQPHQW
&HQWULIXJHV
&HQWULIXJHV DUH XVHG URXWLQHO\ LQ WLVVXH FXOWXUH DV SDUW RI WKH VXEFXOWXUH URXWLQH IRU
PRVW FHOO OLQHV DQG IRU WKH SUHSDUDWLRQ RI FHOOV IRU FU\RSUHVHUYDWLRQ %\ WKHLU YHU\ QDWXUH
FHQWULIXJHV SURGXFH DHURVROV DQG WKXV LW LV QHFHVVDU\ WR PLQLPL]H WKLV ULVN 7KLV FDQ EH
DFKLHYHGE\SXUFKDVLQJPRGHOVWKDWKDYHVHDOHGEXFNHWV,GHDOO\WKHFHQWULIXJHVKRXOGKDYH
DFOHDUOLGVRWKDWWKHFRQGLWLRQRIWKHORDGFDQEHREVHUYHGZLWKRXWRSHQLQJWKHOLG7KLVZLOO
UHGXFHWKHULVNRIWKHRSHUDWRUEHLQJH[SRVHGWRKD]DUGRXVPDWHULDOLIDFHQWULIXJHWXEHKDV
EURNHQGXULQJFHQWULIXJDWLRQ&DUHVKRXOGDOZD\VEHWDNHQQRWWRRYHUILOOWKHWXEHVDQGWR
EDODQFHWKHPFDUHIXOO\7KHVHVLPSOHVWHSVZLOOUHGXFHWKHULVNRIDHURVROVEHLQJJHQHUDWHG
7KH FHQWULIXJH VKRXOG EH VLWXDWHG ZKHUH LW FDQ EH HDVLO\ DFFHVVHG IRU FOHDQLQJ DQG
PDLQWHQDQFH&HQWULIXJHVVKRXOGEHFKHFNHGIUHTXHQWO\IRUVLJQVRIFRUURVLRQ

,QFXEDWRUV

ϵ

 &HOO FXOWXUHV UHTXLUH D VWULFWO\ FRQWUROOHG HQYLURQPHQW LQ ZKLFK WR JURZ 6SHFLDOLVW
LQFXEDWRUVDUHXVHGURXWLQHO\WRSURYLGHWKHFRUUHFWJURZWKFRQGLWLRQVVXFKDVWHPSHUDWXUH
GHJUHHRIKXPLGLW\DQG&2OHYHOVLQDFRQWUROOHGDQGVWDEOHPDQQHU*HQHUDOO\WKH\FDQEH
VHWWRUXQDWWHPSHUDWXUHVLQWKHUDQJHž& IRULQVHFWFHOOOLQHV WRž& IRUPDPPDOLDQ
FHOOOLQHV DQGVHWWRSURYLGH&2DWWKHUHTXLUHGOHYHO HJ 6RPHLQFXEDWRUVDOVR
KDYHWKHIDFLOLW\WRFRQWUROWKH2OHYHOV&RSSHUFRDWHGLQFXEDWRUVDUHDOVRQRZDYDLODEOH
7KHVHDUHUHSRUWHGWRUHGXFHWKHULVNRIPLFURELDOFRQWDPLQDWLRQZLWKLQWKHLQFXEDWRUGXHWR
WKHPLFURELDOLQKLELWRU\DFWLYLW\RIFRSSHU7KHLQFOXVLRQRIZDWHUEDWKWUHDWPHQWIOXLGLQWKH
LQFXEDWRU ZDWHU WUD\V ZLOO DOVR UHGXFH WKH ULVN RI EDFWHULDO DQG IXQJDO JURZWK LQ WKH ZDWHU
WUD\V+RZHYHUWKHUHLVQRVXEVWLWXWHIRUUHJXODUFOHDQLQJ )LJXUH 


)LJXUH$QLQFXEDWRUER[FDQEHFRQVWUXFWHGWRILWRYHUWKHHQWLUHPLFURVFRSHDQGSURYLGH
WHPSHUDWXUHDQG&2FRQWUROIRUWLPHODSVHPLFURFLQHPDWRJUDSK\
:RUN6XUIDFHVDQG)ORRULQJ
7RPDLQWDLQDFOHDQZRUNLQJHQYLURQPHQWWKHODERUDWRU\VXUIDFHVLQFOXGLQJEHQFKWRSV
ZDOOVDQGIORRULQJVKRXOGEHVPRRWKDQGHDV\WRFOHDQ7KH\VKRXOGDOVREHZDWHUSURRIDQG
UHVLVWDQWWRDYDULHW\RIFKHPLFDOV VXFKDVDFLGVDONDOLVVROYHQWVDQGGLVLQIHFWDQWV ,QDUHDV
XVHGIRUWKHVWRUDJHRIPDWHULDOVLQOLTXLGQLWURJHQWKHIORRUVVKRXOGEHUHVLVWDQWWRFUDFNLQJ
LI DQ\ OLTXLG QLWURJHQ LV VSLOW 5HIHU WR 6HFWLRQ  IRU VDIHW\ FRQVLGHUDWLRQV RQ WKH XVH RI
OLTXLG QLWURJHQ ,Q DGGLWLRQ WKH IORRUV DQG ZDOOV VKRXOG EH FRQWLQXRXV ZLWK D FRYHUHG
VNLUWLQJ DUHD WR PDNH FOHDQLQJ HDVLHU DQG UHGXFH WKH SRWHQWLDO IRU GXVW WR DFFXPXODWH
:LQGRZV VKRXOG EH VHDOHG :RUN VXUIDFHV VKRXOG EH SRVLWLRQHG DW D FRPIRUWDEOH ZRUNLQJ
KHLJKW )LJXUH 

ϭϬ

 
)LJXUH6XJJHVWHGIORRUSODQIRUDVWDQGDUGWLVVXHFXOWXUHIDFLOLW\
3ODVWLFZDUHDQG&RQVXPDEOHV
$OPRVW HYHU\W\SH RI FHOO FXOWXUH YHVVHO WRJHWKHU ZLWK VXSSRUW FRQVXPDEOHV VXFK DV
WXEHVDQGSLSHWWHVDUHFRPPHUFLDOO\DYDLODEOHDVDVLQJOHXVHVWHULOHSDFNHGSODVWLFZDUH
7KH XVH RI VXFK SODVWLF ZDUH LV PRUH FRVW HIIHFWLYH WKDQ UHF\FOLQJ JODVVZDUH HQDEOHV D
KLJKHU OHYHO RI TXDOLW\ DVVXUDQFH DQG UHPRYHV WKH QHHG IRU YDOLGDWLRQ RI FOHDQLQJ DQG
VWHULOL]DWLRQ SURFHGXUHV 3ODVWLF WLVVXH FXOWXUH IODVNV DUH XVXDOO\ WUHDWHG WR SURYLGH D
K\GURSKLOLFVXUIDFHWRIDFLOLWDWHDWWDFKPHQWRIDQFKRUDJHGHSHQGHQWFHOOV
&DUHDQG0DLQWHQDQFHRI/DERUDWRU\$UHDV
7R PDLQWDLQ D FOHDQ DQG VDIH ZRUNLQJ HQYLURQPHQW WLGLQHVV DQG FOHDQOLQHVV DUH NH\
2EYLRXVO\ DOO VSLOOV VKRXOG EH GHDOW ZLWK LPPHGLDWHO\ 5RXWLQH FOHDQLQJ VKRXOG DOVR EH
XQGHUWDNHQ LQYROYLQJ WKH FOHDQLQJ RI DOO ZRUN VXUIDFHV ERWK LQVLGH DQG RXWVLGH RI WKH
PLFURELRORJLFDOVDIHW\FDELQHWWKHIORRUVDQGDOORWKHUSLHFHVRIHTXLSPHQWHJFHQWULIXJHV
+XPLGLILHGLQFXEDWRUV DUH D SDUWLFXODUDUHD IRUFRQFHUQGXHWRWKHSRWHQWLDOIRUIXQJDODQG
EDFWHULDO JURZWK LQ WKH ZDWHU WUD\V 7KLV ZLOO FUHDWH D FRQWDPLQDWLRQ ULVN WKDW FDQ RQO\ EH
DYRLGHG E\ UHJXODU FOHDQLQJ RI WKH LQFXEDWRU $OO PDMRU SLHFHV RI HTXLSPHQW VKRXOG EH
UHJXODUO\PDLQWDLQHGDQGVHUYLFHGE\TXDOLILHGHQJLQHHUV


ϭϭ

 )RULQVWDQFH

x 0LFURELRORJLFDOVDIHW\FDELQHWVVKRXOGEHFKHFNHGRQFHLQHYHU\PRQWKVWRHQVXUH
WKDWWKH\DUHVDIHWRXVHLQWHUPVRISURGXFWDQGXVHUSURWHFWLRQ7KHVHWHVWVFRQILUP
WKDWWKHDLUIORZLVFRUUHFWDQGWKDWWKH+(3$ILOWHUVDUHIXQFWLRQLQJSURSHUO\
x 7KH WHPSHUDWXUH RI DQ LQFXEDWRU VKRXOG EH UHJXODUO\ FKHFNHG ZLWK D 1$0$6
1DWLRQDO$FFUHGLWDWLRQRI0HDVXUHPHQWDQG6DPSOLQJ8. RUHTXLYDOHQWFDOLEUDWHG
WKHUPRPHWHUDQGWKHWHPSHUDWXUHDGMXVWHGDVQHFHVVDU\
x ,QFXEDWRU&2DQG2OHYHOVVKRXOGDOVREHUHJXODUO\FKHFNHGWRHQVXUHWKHOHYHOVDUH
EHLQJFRUUHFWO\PDLQWDLQHG

6DIHW\$VSHFWVRI&HOO&XOWXUHDQG%LRVDIHW\OHYHOV

5LVN$VVHVVPHQW
7KHPDLQDLPRIULVNDVVHVVPHQWLVWRSUHYHQWLQMXU\SURWHFWSURSHUW\DQGDYRLGKDUP
WR LQGLYLGXDOV DQG WKH HQYLURQPHQW 7KH SHUIRUPDQFH RI ULVN DVVHVVPHQW LV D OHJDO
UHTXLUHPHQW XQGHU WKH +HDOWK DQG 6DIHW\ DW :RUN $FW 8. 7KHUH DUH RWKHU (& GLUHFWLYHV
FRYHULQJ +HDOWK DQG 6DIHW\ DW :RUN \RX FDQ YLVLW WKH (XURSHDQ $JHQF\ IRU 6DIHW\ DQG
+HDOWKDW:RUNZHEVLWHZZZHXURSHRVKDHXLQWIRULQIRUPDWLRQRQOHJLVODWLRQDQGVWDQGDUGV
RU \RX VKRXOG FRQWDFW \RXU RQVLWH UHSUHVHQWDWLYH &RQVHTXHQWO\ ULVN DVVHVVPHQWV PXVW EH
XQGHUWDNHQEHIRUHVWDUWLQJDQ\DFWLYLW\7KHDVVHVVPHQWFRQVLVWVRIWZRHOHPHQWV

 ,GHQWLI\LQJDQGHYDOXDWLQJWKHULVNV
 'HILQLQJZD\VRIPLQLPL]LQJRUDYRLGLQJWKHULVN

)RUDQLPDOFHOOFXOWXUHWKHOHYHORIULVNLVGHSHQGHQWXSRQWKHFHOOOLQHWREHXVHGDQG
LV EDVHG RQ ZKHWKHU WKH FHOO OLQH LV OLNHO\ WR FDXVH KDUP WR KXPDQV 7KH GLIIHUHQW
FODVVLILFDWLRQVDUHJLYHQEHORZ

/RZULVN 1RQ KXPDQQRQ SULPDWH FRQWLQXRXV FHOO OLQHV DQG VRPH ZHOO
 FKDUDFWHUL]HGKXPDQGLSORLGOLQHVRIILQLWHOLIHVSDQ HJ05& 
0HGLXPULVN 3RRUO\FKDUDFWHUL]HGPDPPDOLDQFHOOOLQHV
&HOOOLQHVGHULYHGIURPKXPDQSULPDWHWLVVXHRUEORRG
 &HOO OLQHV ZLWK HQGRJHQRXV SDWKRJHQV WKH SUHFLVH FDWHJRUL]DWLRQ LV
 GHSHQGHQWXSRQWKHSDWKRJHQ ±UHIHUWR$&'3JXLGHOLQHVIRU
+LJKULVN GHWDLOV
 
 &HOO OLQHV XVHG IROORZLQJ H[SHULPHQWDO LQIHFWLRQ ZKHUH WKH
 FDWHJRUL]DWLRQLVGHSHQGHQWXSRQWKHLQIHFWLQJDJHQW
 
 

$ FXOWXUH FROOHFWLRQ VXFK DV (&$&& ZLOO UHFRPPHQG D PLQLPXP WKH FRQWDLQPHQW
OHYHO UHTXLUHG IRU D JLYHQ FHOO OLQH EDVHG XSRQ LWV ULVN DVVHVVPHQW )RU PRVW FHOO OLQHV WKH
DSSURSULDWHOHYHORIFRQWDLQPHQWLV&DWHJRU\+RZHYHUWKLVPD\QHHGWREHLQFUHDVHGWR
&DWHJRU\  GHSHQGLQJXSRQ WKH W\SH RI PDQLSXODWLRQV WR EH FDUULHG RXW DQG ZKHWKHU ODUJH
FXOWXUH YROXPHV DUH HQYLVDJHG )RU FHOO OLQHV GHULYHG IURP SDWLHQWV ZLWK +,9 RU +7/9
&DWHJRU\FRQWDLQPHQWLVUHTXLUHG

ϭϮ

 &RQWDLQPHQWLVWKHPRVWREYLRXVPHDQVRIUHGXFLQJULVN2WKHUOHVVREYLRXVPHDVXUHV
LQFOXGH UHVWULFWLQJ WKH PRYHPHQW RI VWDII DQG HTXLSPHQW LQ DQG RXW RI WKH ODERUDWRULHV $
JRRG ODERUDWRU\ SUDFWLFH DQG JRRG EHQFK WHFKQLTXHV VXFK DV HQVXULQJ ZRUN DUHDV DUH
XQFOXWWHUHG UHDJHQWV DUH FRUUHFWO\ ODEHOHG DQG VWRUHG DUH DOVR LPSRUWDQW IRU UHGXFLQJ ULVN
DQGPDNLQJWKHODERUDWRU\DVDIHHQYLURQPHQWLQZKLFKWRZRUN6WDIIWUDLQLQJDQGWKHXVHRI
ZULWWHQVWDQGDUGRSHUDWLQJSURFHGXUHVDQGULVNDVVHVVPHQWVZLOODOVRUHGXFHWKHSRWHQWLDOIRU
KDUP7UDLQLQJFRXUVHVFRYHULQJWKHEDVLFVRIWLVVXHFXOWXUHVDIHW\DUHRIIHUHGE\(&$&&
'LVLQIHFWLRQ
0HWKRGVGHVLJQHGIRUWKHGLVLQIHFWLRQGHFRQWDPLQDWLRQRIFXOWXUHZDVWHZRUNVXUIDFHV
DQGHTXLSPHQWUHSUHVHQWLPSRUWDQWPHDQVIRUPLQLPL]LQJWKHULVNRIKDUP
7KH PDMRU GLVLQIHFWDQWV IDOO LQWR IRXU JURXSV DQG WKHLU UHODWLYH PHULWV FDQ EH
VXPPDUL]HGDVIROORZV
+\SRFKORULWHV HJ&KORURV3UHVHSW 

x $JRRGJHQHUDOSXUSRVHGLVLQIHFWDQW
x $FWLYHDJDLQVWYLUXVHV
x &RUURVLYH DJDLQVW PHWDOV DQG WKHUHIRUH VKRXOG QRW EH XVHG RQ PHWDO VXUIDFHV HJ
FHQWULIXJHV
x 5HDGLO\LQDFWLYDWHGE\RUJDQLFPDWWHUDQGWKHUHIRUHVKRXOGEHPDGHIUHVKGDLO\
x 6KRXOGEHXVHGDWSSPIRUJHQHUDOXVHVXUIDFHGLVLQIHFWLRQSSPLQGLVFDUG
ZDVWHSRWVIRUZDVKLQJSLSHWWHVDQGSSPIRUWLVVXHFXOWXUHZDVWHDQGVSLOODJH

127(:KHQIXPLJDWLQJDFDELQHWRUURRPXVLQJIRUPDOGHK\GHDOOWKHK\SRFKORULWHV
PXVWILUVWEHUHPRYHGDVWKHWZRFKHPLFDOVUHDFWWRJHWKHUWRSURGXFHFDUFLQRJHQLFSURGXFWV
3KHQROLFV HJ6XGRO+\FROLQ 

x 1RWDFWLYHDJDLQVWYLUXVHV
x 5HPDLQVDFWLYHLQWKHSUHVHQFHRIRUJDQLFPDWWHU

$OFRKRO HJHWKDQROLVRSURSDQRO 

x (IIHFWLYHFRQFHQWUDWLRQVIRUHWKDQROIRULVRSURSDQRO
x 7KHLUPRGHRIDFWLYLW\LVE\GHK\GUDWLRQDQGIL[DWLRQ
x (IIHFWLYH DJDLQVW EDFWHULD (WKDQRO LV HIIHFWLYH DJDLQVW PRVW YLUXVHV EXW QRW
QRQHQYHORSHGYLUXVHV
x ,VRSURSDQROLVQRWHIIHFWLYHDJDLQVWYLUXVHV

$OGHK\GHV HJJOXWDUDOGHK\GHIRUPDOGHK\GH 

x $OGHK\GHV DUH LUULWDQWV DQG WKHLU XVH VKRXOG EH OLPLWHG GXH WR SUREOHPV RI
VHQVLWL]DWLRQ
x *OXWDUDOGHK\GH PD\ EH XVHG LQ VLWXDWLRQV ZKHUH WKH XVH RI K\SRFKORULWHV LV QRW
VXLWDEOH HJFOHDQLQJRI FHQWULIXJH ERZOV RU PDWHULDOV FRQVWUXFWHG RI VWDLQOHVV VWHHO
WKDWPD\EHDWWDFNHGRUFRUURGHGE\XVLQJK\SRFKORULWHVROXWLRQV

ϭϯ

:DVWH'LVSRVDO
$Q\ HPSOR\HU KDV D µGXW\ RI FDUH¶ WR GLVSRVH RI DOO ELRORJLFDO ZDVWH VDIHO\ LQ
DFFRUGDQFH ZLWK QDWLRQDO OHJLVODWLYH UHTXLUHPHQWV *LYHQ EHORZ LV D OLVW RI ZD\V LQ ZKLFK
WLVVXHFXOWXUHZDVWHFDQEHGHFRQWDPLQDWHGDQGGLVSRVHGRIVDIHO\2QHRIWKHPRVWLPSRUWDQW
DVSHFWVRIWKHPDQDJHPHQWRIDOOODERUDWRU\JHQHUDWHGZDVWHLVWRGLVSRVHRIZDVWHUHJXODUO\
DQG QRW WRDOORZ WKHDPRXQWV WR EXLOG XS 7KHEHVW DSSURDFKLV µOLWWOH DQGRIWHQ¶ 'LIIHUHQW
IRUPVRIZDVWHUHTXLUHGLIIHUHQWWUHDWPHQW

x 7LVVXH FXOWXUH ZDVWH FXOWXUH PHGLXP   ,QDFWLYDWH RYHUQLJKW LQ D VROXWLRQ RI
K\SRFKORULWH SSP EHIRUHGLVSRVDOWRGUDLQZLWKDQH[FHVVRIZDWHU
x &RQWDPLQDWHG SLSHWWHV VKRXOG EH SODFHG LQ K\SRFKORULWH VROXWLRQ  SSP 
RYHUQLJKWEHIRUHGLVSRVDOE\DXWRFODYLQJDQGLQFLQHUDWLRQ
x 6ROLGZDVWHVXFKDVIODVNVFHQWULIXJHWXEHVFRQWDPLQDWHGJORYHVWLVVXHVHWFVKRXOG
EH SODFHG LQVLGH KHDY\ GXW\ VDFNV IRU FRQWDPLQDWHG ZDVWH DQG DXWRFODYHG EHIRUH
LQFLQHUDWLRQ

,IDWDOOSRVVLEOHZDVWHVKRXOGEHLQFLQHUDWHGUDWKHUWKDQDXWRFODYHG

%LRVDIHW\OHYHO

)URP WKH HDUOLHVW GD\V RI PLFURELRORJLFDO UHVHDUFK LW ZDV UHFRJQL]HG WKDW DFTXLULQJ
LQIHFWLRQV IURP WKH DJHQWV PDQLSXODWHG ZDV DQ RFFXSDWLRQDO KD]DUG 7KH PRVW FRPPRQO\
DFTXLUHGODERUDWRU\LQIHFWLRQVZHUHFDXVHGE\EDFWHULDODJHQWVDVPLFURELRORJLVWVOHDUQHGWR
FXOWXUH DQLPDO YLUXVHV WKH\ DOVR IRXQG ZD\V WR EHFRPH LQIHFWHG ZLWK WKHVH DJHQWV
6LJQLILFDQW QXPEHU RIWKHVHLQIHFWLRQV ZDV IDWDODQGWKDW PRVW LQIHFWLRQV ZHUH RI XQNQRZQ
RULJLQ([SRVXUHWRLQIHFWLRXVDHURVROVZDVLPSOLFDWHGLQDERXWUHSRUWHGLQIHFWLRQV

*XLGHOLQHV HYROYHG DV D PHDQV RI SURWHFWLQJ PLFURELRORJLFDO ZRUNHUV EDVHG RQ WKHVH
GDWDDQGDQXQGHUVWDQGLQJRIWKHULVNVDVVRFLDWHGZLWKYDULRXVPDQLSXODWLRQVRIPDQ\DJHQWV
WUDQVPLVVLEOHE\GLIIHUHQWURXWHV7KHVHJXLGHOLQHVZRUNIURPWKHSUHPLVHWKDWVDIHZRUNVLWHV
UHVXOWIURPDFRPELQDWLRQRIHQJLQHHULQJFRQWUROVPDQDJHPHQWSROLFLHVZRUNSUDFWLFHVDQG
SURFHGXUHVDQGRFFDVLRQDOO\PHGLFDOLQWHUYHQWLRQV7KHGLIIHUHQWELRVDIHW\OHYHOVGHYHORSHG
IRU PLFURELRORJLFDO DQG ELRPHGLFDO ODERUDWRULHV SURYLGH LQFUHDVLQJ OHYHOV RI SHUVRQQHO DQG
HQYLURQPHQWDOSURWHFWLRQ

7KHUHLVDGHILQLWHKLHUDUFK\RIDGPLQLVWUDWLYHFRQWUROVWKDWQHHGWREHLQHIIHFW8SSHU
OHYHO PDQDJHPHQW PXVW VHW WKH JHQHUDO WRQH WKDW VDIHW\ LV D KLJK SULRULW\ DW WKHLU LQVWLWXWH
$OWKRXJKWKLVLVRIWHQH[SUHVVHGLQEURDGSROLF\VWDWHPHQWVLWPXVWEHVXSSRUWHGE\UHVRXUFH
DOORFDWLRQ GHFLVLRQV ILQDQFLDO SHUVRQQHO VWDIILQJ WUDLQLQJ D VDIHW\ SHUIRUPDQFH UHZDUG
VWUXFWXUH HWF )RU HDFK ELRVDIHW\ OHYHO WKHUH DUH DOVR VSHFLILF VXSHUYLVRU\ TXDOLILFDWLRQV DV
DVVXUDQFH WKDW WKH ODERUDWRULDQV DUH SURYLGHG DSSURSULDWH UROH PRGHOV DQG NQRZOHGJHDEOH
PHQWRUV &UXFLDO WR VDIH ZRUNLQJ FRQGLWLRQV DUH YDULRXV W\SHV RI VSHFLDOL]HG HTXLSPHQW
DYDLODEOHWRVHUYHDVSULPDU\EDUULHUVEHWZHHQWKHPLFURRUJDQLVPDQGWKHODERUDWRULDQ7KHVH
UDQJH IURP VLPSOH JORYHV DQG RWKHU SHUVRQQHO SURWHFWLYH HTXLSPHQW WR VLPSOH VHDOHG
FHQWULIXJHKHDGV RUFRPSOH[ ELRVDIHW\FDELQHWV FRQWDLQPHQWGHYLFHV
$ ELRVDIHW\ OHYHO LV WKH OHYHO RI WKH ELRFRQWDLQPHQW SUHFDXWLRQV UHTXLUHG WR LVRODWH
GDQJHURXVELRORJLFDODJHQWVLQDQHQFORVHGIDFLOLW\7KHOHYHOVRIFRQWDLQPHQWUDQJHIURPWKH
ORZHVWELRVDIHW\OHYHOWRWKHKLJKHVWDWOHYHO,QWKH8QLWHG6WDWHVWKH&HQWUHVIRU'LVHDVH

ϭϰ

&RQWRODQG3UHYHQWLRQ &'& KDYHVSHFLILHGWKHVHOHYHOV,QWKH(XURSHDQ8QLRQWKHVDPH
ELRVDIHW\OHYHOVDUHGHILQHGLQDGLUHFWLYH

/HYHOV
%LRVDIHW\/HYHO

%6/ LV DSSURSULDWH IRU ZRUNLQJ ZLWK PLFURRUJDQLVPV WKDW DUH QRW NQRZQ WR FDXVH
GLVHDVH LQ KHDOWK\ KXPDQV 7KLV LV WKH W\SH RI ODERUDWRU\ IRXQG LQ PXQLFLSDO ZDWHUWHVWLQJ
ODERUDWRULHV LQ KLJK VFKRROV DQG LQ VRPH FRPPXQLW\ FROOHJHV WHDFKLQJ LQWURGXFWRU\
PLFURELRORJ\FODVVHVZKHUHWKHDJHQWVDUHQRWFRQVLGHUHGKD]DUGRXV7KHOD\RXWRIDW\SLFDO
%6/ODERUDWRU\LVVKRZQLQ

7KHUHLVDGRRUWKDWFDQEHFORVHGWRNHHSYLVLWRUVRXWRIWKHODEZKLOHZRUNZLWKWKH
DJHQWVLVLQSURJUHVV+D]DUGZDUQLQJVLJQVPD\EHSRVWHGRQWKHGRRULQGLFDWLQJDQ\KD]DUGV
WKDW PD\ EH SUHVHQW LQFOXGLQJ UDGLRDFWLYH PDWHULDOV ODVHU OLJKWV KLJK QRLVH HPLWWLQJ
HTXLSPHQW RU WR[LF FKHPLFDOV 7KHUH LV D KDQGZDVKLQJ VLQN DYDLODEOH SUHIHUDEO\ QHDU WKH
GRRU :DVWH PDWHULDOV DUH VHJUHJDWHG DFFRUGLQJ WR KD]DUG W\SH DQG WKHUH LV DQ DSSURSULDWH
FKHPLFDO GHFRQ WUD\ IRU FROOHFWLQJ FRQWDPLQDWHG LPSOHPHQWV :RUN LV GRQH RQ WKH RSHQ
EHQFKDQGSODVWLFEDFNHGDEVRUEHQWSDGVFDQEHSODFHGRQWKHZRUNVXUIDFHWRFROOHFWVSODWWHU
RU GURSOHWV DVVRFLDWHG ZLWK WKH ZRUN 7KH EHQFK WRSV VKRXOG EH LPSHUYLRXV WR DFLG DQG DOO
IXUQLWXUHVKRXOG EH VWXUG\ ,I WKH ZLQGRZV FDQEH RSHQHG LQ WKH ODERUDWRU\ WKH\ VKRXOG EH
ILWWHGZLWKVFUHHQV

7KH ODE VKRXOG EH FRQVWUXFWHG LQ VXFK D PDQQHU WKDW LW FDQ EH HDVLO\ FOHDQHG DQG
GHFRQWDPLQDWHG $W %6/ WKHUH LV QR VSHFLILF UHFRPPHQGDWLRQ WKDW WKH ODERUDWRU\ EH
LVRODWHG IURP RWKHU SDUWV RI WKH EXLOGLQJ $OWKRXJK WKHUH LV QR VSHFLILF ELRORJLFDO VDIHW\
UHDVRQ IRU KDYLQJ PRUH WKDQ VL[ DLU FKDQJHV SHU KRXU LQ D %6/ ODERUDWRU\ LW PD\ EH
QHFHVVDU\LIWKHUHDUHYRODWLOHRUWR[LFFKHPLFDOVLQXVH,QJHQHUDOLQZDUGGLUHFWLRQDODLUIORZ
LVWKHLGHDO

$W %6/ VWDQGDUG PLFURELRORJLFDO SUDFWLFHV LQFOXGH WKH XVHRIPHFKDQLFDO SLSHWWLQJ
GHYLFHVKDYLQJDSURKLELWLRQRQHDWLQJGULQNLQJDQGVPRNLQJLQWKHODEDQGUHTXLULQJKDQG
ZDVKLQJE\DOOSHUVRQVZKHQWKH\ILQLVKWKHLUZRUNRUZKHQH[LWLQJWKHODERUDWRU\3HUVRQV
ZRUNLQJLQWKHODEVKRXOGZHDUDODEFRDWWRSURWHFWWKHLUVWUHHWFORWKHV,WLVDUHFRPPHQGHG
SUDFWLFHWRZHDUJORYHVZKLOHPDQLSXODWLQJWKHDJHQWV$GGLWLRQDOSURWHFWLYHHTXLSPHQWPD\
LQFOXGH ZRUNLQJ EHKLQG D VSODWWHU VKLHOG RU ZHDULQJ H\H RU IDFH SURWHFWLRQ $W %6/ QR
VSHFLDOSUHFDXWLRQVDUHQHHGHG

+DQG ZDVKLQJ LV RQH RI WKH PRVW LPSRUWDQW SURFHGXUHV WKDW FDQ EH XVHG E\
ODERUDWRULDQV WR SUHYHQWUHPRYDO RI XQZDQWHGPLFURELRORJLFDODJHQWVUDGLRDFWLYHPDWHULDOV
RUFKHPLFDOVIURPWKHODERUDWRU\HQYLURQPHQW8VHRI OLTXLGVRDSLVJHQHUDOO\SUHIHUDEOHWR
EDU VRDS WZHQW\ VHFRQGV RI YLJRURXV ODWKHULQJ ZLOO UHPRYH PRVW RI WKHVH PDWHULDOV YHU\
HIIHFWLYHO\$IWHUGU\LQJ\RXUKDQGVZLWKDSDSHUWRZHO\RXFDQXVHWKHWRZHOWRWXUQRIIWKH
IDXFHWVDQGWKXVSUHYHQWUHFRQWDPLQDWLQJ\RXUKDQGV

7KH VFLHQWLVW ZKR SURYLGHV RYHUDOO VXSHUYLVLRQ WR D %6/ ODERUDWRU\ QHHGV WR KDYH
JHQHUDO WUDLQLQJ LQ PLFURELRORJ\ RU D UHODWHG VFLHQFH 7KH VXSHUYLVRU LV UHVSRQVLEOH IRU
HVWDEOLVKLQJ WKH JHQHUDO ODE VDIHW\ SURFHGXUHV DQG IRU HQVXULQJ WKDW HDFK ODERUDWRULDQ LV
SURSHUO\ HGXFDWHG LQ WKHVH SURFHGXUHV /DE SHUVRQQHO FRQYHUVHO\ QHHG WR DFFHSW VXFK
WUDLQLQJDQGIROORZWKHSURVFULEHGSURWRFROV

ϭϱ

%LRVDIHW\/HYHO

7KHIDFLOLW\WKHFRQWDLQPHQWGHYLFHVWKHDGPLQLVWUDWLYHFRQWUROVDQGWKHSUDFWLFHVDQG
SURFHGXUHV WKDW FRQVWLWXWH %6/ DUH GHVLJQHG WR PD[LPL]H VDIH ZRUNLQJ FRQGLWLRQV IRU
ODERUDWRULDQV ZRUNLQJ ZLWK DJHQWV RI PRGHUDWH ULVN WR SHUVRQQHO DQG WKH HQYLURQPHQW 7KH
DJHQWVPDQLSXODWHGDW%6/DUHRIWHQRQHVWRZKLFKWKHZRUNHUVKDYHKDGH[SRVXUHWRLQWKH
FRPPXQLW\ RIWHQ DV FKLOGUHQ DQG WR ZKLFK WKH\ KDYH DOUHDG\ H[SHULHQFHG DQ LPPXQH
UHVSRQVH 8QOLNH WKH JXLGHOLQHV IRU %6/ WKHUH DUH D QXPEHU RI LPPXQL]DWLRQV
UHFRPPHQGHG EHIRUH ZRUNLQJ ZLWK VSHFLILF DJHQWV 0RVW QRWDEOH LV KHSDWLWLV % YLUXV
LPPXQL]DWLRQZKLFKLVUHFRPPHQGHGE\WKH2FFXSDWLRQDO6DIHW\DQG+HDOWK$GPLQLVWUDWLRQ
IRU SHUVRQV LQFOXGLQJ ODERUDWRULDQV DW KLJK ULVN RI H[SRVXUH WR EORRG DQG EORRG SURGXFWV
7KHVH DJHQWV DUH JHQHUDOO\ WUDQVPLVVLEOH IROORZLQJ LQJHVWLRQ H[SRVXUH RI PXFRXV
PHPEUDQHVRULQWUDGHUPDOH[SRVXUH(DWLQJGULQNLQJDQGVPRNLQJDUHSURKLELWHGLQ%6/
ODERUDWRULHV DQG H[WUHPH SUHFDXWLRQV DUH WDNHQ ZKLOH KDQGOLQJ QHHGOHV DQG RWKHU VKDUS
LQVWUXPHQWV

7KH EDVLF OD\RXW RI D %6/ ODERUDWRU\ LV GHSLFWHG LQ $FFHVV WR WKH ODERUDWRU\ LV
UHVWULFWHG E\ WKH VXSHUYLVRU ZKR HVWDEOLVKHV WKH ELRVDIHW\ OHYHO WKH QHHG IRU VSHFLILHG
SHUVRQDOSURWHFWLYHHTXLSPHQWWKHQHHGIRUWUDLQLQJRURWKHUDSSURSULDWHUHTXLUHPHQWV7KH
GRRU WR WKH ODERUDWRU\ LV NHSW FORVHG WR PLQLPL]H XQQHFHVVDU\ DFFHVV E\ FDVXDO YLVLWRUV
YHQGRUV RU SHUVRQV QRW QHHGLQJ WR EH LQ WKH ODERUDWRU\ 7KHUH LV QR UHTXLUHPHQW IRU
GLUHFWLRQDO LQZDUG DLU IORZ LQ D %6/ ODERUDWRU\ H[FHSW DV PD\ EH UHTXLUHG IRU FKHPLFDO
RGRUFRQWUROKRZHYHUPDQ\%6/ODERUDWRULHVRSWIRUWKLVIHDWXUH

6RPHZRUNPD\EHGRQHRQWKHRSHQEHQFKE\SHUVRQVZHDULQJDSSURSULDWHSURWHFWLYH
FORWKLQJ RU JHDU $Q\ ZRUN WKDW PD\ SURGXFH VSODWWHUV RU DHURVROV RI LQIHFWLRXV PDWHULDOV
VKRXOGEHGRQHLQVLGHDELRORJLFDOVDIHW\FDELQHW %6& RURWKHUFRQWDLQPHQWGHYLFHVXFKDV
DHURVROFRQWDLQLQJ FHQWULIXJH FXSV :DVWH PDWHULDOV QHHG WR EH VHJUHJDWHG LQWR FKHPLFDO
UDGLRDFWLYH ELRKD]DUGRXV RU JHQHUDO ZDVWH VWUHDPV ,QIHFWLRXV ZDVWH VKRXOG EH
GHFRQWDPLQDWHG E\WUHDWLQJZLWKFKHPLFDOGLVLQIHFWDQWVRUE\VWHDPDXWRFODYLQJ 

$V WKH ELRVDIHW\ OHYHO LQFUHDVHV DOO WKRVH PLFURELRORJLFDO SUDFWLFHV DQG SURFHGXUHV
GHOLQHDWHG IRU WKH ORZHU OHYHO V  DUH FDUULHG IRUZDUG WR WKH QH[W KLJKHU OHYHO 7KXV WKH
VWDQGDUGPLFURELRORJLFDOSUDFWLFHVIRXQGDW%6/DUHVWLOOLQHIIHFWDW%6/ZLWKHPSKDVLV
RQZHDULQJ JORYHVXVLQJ PHFKDQLFDO SLSHWWLQJ GHYLFHV DQG DWWHQWLRQWRKDQGOLQJVKDUSV,Q
DQ\VLWXDWLRQGRQRWEUHDNRUEHQGQHHGOHVLQPRVWVLWXDWLRQVLWLVSUXGHQWWRXVHVLQJOHXVH
QHHGOHV DQG V\ULQJHV 'R QRW UHFDS QHHGOHV 1HHGOHV DQG V\ULQJHV EXWWHUIO\ QHHGOHV DQG
DVVRFLDWHGWXELQJ DQGVLPLODU GHYLFHV VKRXOG EHGLVFDUGHG LQWDFW LQWRDSXQFWXUHDQGOHDN
SURRI FRQWDLQHU 2WKHU VKDUSV LWHPV VXFK DV EURNHQ JODVV  VKRXOG QRW EH KDQGOHG E\ KDQG
&RQVLGHUVXEVWLWXWLQJSODVWLFZDUHIRUJODVVODERUDWRU\LWHPV

6SHFLILF SROLFLHV DQG SURFHGXUHV UHJDUGLQJ DFFHVV WR WKH %6/ ODERUDWRU\ VKRXOG EH
GHYHORSHGDQGSRVWHG2QWKHRQHKDQGLWLVSUXGHQWWRDOORZHQWU\WRUHSDLUWHFKQLFLDQVRU
HQJLQHHUV RQO\ LI WKH\ DUH YHU\ IDPLOLDU ZLWK WKH DFWLYLWLHV RI WKH ODE RU DUH HVFRUWHG E\ D
ODERUDWRULDQ WKDW LV &RQYHUVHO\ LW QHHGV WR EH HPSKDVL]HG WKDW WKH SRVWLQJ RI D %6/
ELRKD]DUGVLJQRQWKHGRRUGRHVQRWPHDQWKDWWKHDJHQWLVHYHU\ZKHUHLQWKHURRPUDWKHUWKH
DJHQWLVQRUPDOO\FRQILQHGWRWKH%6&DQLQFXEDWRURUUHIULJHUDWRURUIUHH]HU,WLVSUXGHQWWR
VFKHGXOH HQWU\ E\ QRQODERUDWRULDQV WR WLPHV ZKHQ WKHUH LV QR DFWLYH ZRUN ZLWK WKH DJHQW
EHLQJFRQGXFWHG


ϭϲ

 $ OHDN SURRI ER[ SUHIHUDEO\ HTXLSSHG ZLWK D JDVNHW VHDO OLG VKRXOG EH XVHG IRU
WUDQVSRUWRILQIHFWLRXVPDWHULDOVIURPRQHORFDWLRQWRDQRWKHU7KLVLVSDUWLFXODUO\LPSRUWDQW
ZKHQPRYLQJVDPSOHVIURPSDWLHQW FDUHDUHDVWRODERUDWRULHVRUIURPDQRIIVLWHFROOHFWLRQ
FHQWUHWRWKHODE

6WRULQJ D EDVHOLQH VHUXP VDPSOH PD\ EH UHTXLUHG EHIRUH ZRUNLQJ LQ FHUWDLQ
ODERUDWRULHV7KLVVDPSOHFDQEHXVHGDWWRFRPSDUHZLWKIXWXUHVHUXPVDPSOHVWRGHWHUPLQH
DQ\FKDQJHVLQLPPXQRORJLFDOUHVSRQVHWRWKHDJHQWVXVHGLQWKHODERUDWRU\$OWHUQDWLYHO\D
EDVHOLQHVHUXPVDPSOHPD\EHGUDZQDWWKHWLPHRIDSRVVLEOHH[SRVXUHWKHQFRPSDUHGWRD
IXWXUH VDPSOH IRU SRVVLEOH ULVLQJ DQWLERG\ WLWHU ,Q DQ\ HYHQW ZULWWHQ HPSOR\HH LQIRUPHG
FRQVHQWPXVWEHREWDLQHGEHIRUH REWDLQLQJWKHVDPSOHDQGIRU VXEVHTXHQW WHVWLQJ ,QIRUPHG
FRQVHQWLVDOVRQHHGHGIRUDQ\LPPXQL]DWLRQVWKDWDUHRIIHUHG

2WKHU VSHFLDO SUDFWLFHV LQFOXGH GHFRQWDPLQDWLQJ ZRUN VXUIDFHV DIWHU FRPSOHWLQJ WKH
ZRUNZLWKWKHLQIHFWLRXVPDWHULDOVNHHSLQJQRQUHVHDUFKDQLPDOVRXWRIWKHODERUDWRU\DQG
UHSRUWLQJDOOVSLOOVDQGDFFLGHQWV$QLQFLGHQWORJERRNLVDXVHIXOPHDQVIRUUHFRUGLQJHYHQWV
WKDWKDYHJRQHZURQJLWLVLPSRUWDQWWRGRFXPHQWWKHVHHYHQWVQRWIRUSXQLWLYHDFWLRQEXWWR
EHDEOHWREHWWHUXQGHUVWDQG ZKDW KDSSHQHG ZLWKDQ H\HWRSUHYHQWLQJVLPLODUHYHQWVLQWKH
IXWXUH

$W%6/DOOZRUNWKDWPLJKWFUHDWHDHURVROVRILQIHFWLRXVPDWHULDOVVKRXOGEHGRQHLQ
FRQWDLQPHQW7KHPRVWFRPPRQGHYLFHLVWKHELRORJLFDOVDIHW\FDELQHWDQGWKHPRVWFRPPRQ
FDELQHWLQXVHLVUHIHUUHGWRDVD&ODVV,,W\SH$%6&VKRZQLQFURVVVHFWLRQDOGLDJUDPLQ
5RRPDLULVGUDZQLQDWWKHIDFHRSHQLQJDQGLVLPPHGLDWHO\GUDZQWKURXJKWKHIURQWJULOOH
$ DQGXQGHUWKHZRUNVXUIDFH7KHDLULVWKHQEORZQ ) WKURXJKWKHUHDUDLUSOHQXP ( WR
WKHWRSRIWKHFDELQHWZKHUHLWLVGLYLGHGLQWRWZRFKDPEHUV ' 7KLUW\SHUFHQWRIWKHDLULV
H[KDXVWHGRXWRIWKHFDELQHW & WKURXJKDKLJKHIILFLHQF\SDUWLFXODWHDLU +(3$ ILOWHULQWR
WKHODERUDWRU\URRP7KHUHPDLQLQJVHYHQW\SHUFHQWRIWKHDLU % LVGLUHFWHGWKURXJKDQRWKHU
+(3$ILOWHUGRZQRQWRWKHZRUNVXUIDFHLQDODPLQDUIORZGLUHFWLRQDODLUSDWWHUQ7KHW\SLFDO
+(3$ ILOWHU UHPRYHV  RI DOO SDUWLFOHV WKDW DUH  PLFURQ RU ODUJHU LQ VL]H ZKLFK
PHDQVWKDWDOOPLFURELDODJHQWVZLOOEHWUDSSHGLQWKHILOWHU7KHDLUUHWXUQHGWRWKHODERUDWRU\
DQGGHOLYHUHGWRWKHZRUNVXUIDFHLVYLUWXDOO\VWHULOHZKLFKPHDQVWKDWDQRSHQIODPH %XQVHQ
EXUQHU LVQRWQHHGHGZLWKLQWKH%6&

%HIRUHPDWHULDOVDUHLQWURGXFHGLQWRWKH%6&WKH\VKRXOGEHZLSHGZLWKDOFRKRO
WR UHPRYHDQ\ H[WHUQDO FRQWDPLQDQWV ([SHULHQFH KDV VKRZQ WKDWFOHDQPDWHULDOVVKRXOGEH
NHSW WR RQH VLGH RI WKH ZRUN VXUIDFH GLUW\ LWHPV RQ WKH RWKHU 0DQDJHPHQW RI ZRUNIORZ
ZLWKLQWKH%6&LVFUXFLDOWRSUHYHQWLQJFURVVFRQWDPLQDWLRQ5DSLGDLUPRYHPHQWRXWVLGHWKH
FDELQHW FDXVHGE\FRZRUNHUVZDONLQJSDVWDLUVXSSO\YHQWVGLUHFWHGDFURVVWKHIDFHRIWKH
%6& HWF  ZLOO LQWHUUXSW WKH UDWKHU IUDJLOH DLU FXUWDLQ ZKLFK PD\ FDXVH DLUERUQH
FRQWDPLQDQWV LQ WKH FDELQHW WR EH GUDZQ LQWR WKH ODS RI WKH ZRUNHU 7KH FKDLU VKRXOG EH
DGMXVWHGVRWKDWWKHORZHUSRUWLRQRIWKHVDVKLVHYHQZLWKWKHZRUNHU¶VDUPSLWV

$Q\ SDSHU RU SODVWLF PDWHULDOV LQWURGXFHG LQWR WKH %6& VKRXOG QRW EH DOORZHG WR
LQWHUIHUH ZLWK DLU IORZ WKURXJK WKH IURQW RU UHDU JULOOHV 7KH GRZQZDUG DLUIORZ IURP WKH
VXSSO\ILOWHUVSOLWVDERXWRQHWKLUGRIWKHZD\LQWRWKHFDELQHWLQWKHIURQWWKLUGDLUPRYHV
WRWKHIURQWJULOOHZLWKWKHUHPDLQGHURIWKHDLUIORZLQJWRWKHUHDU7KLVPHDQVWKDWDHURVRO
JHQHUDWLQJDFWLYLWLHV VKRXOGEHSHUIRUPHGWRZDUGVWKH UHDU RI WKH FDELQHWWR SURYLGH IXUWKHU
ZRUNHUSURWHFWLRQ


ϭϳ

 ,QIHFWLRXV ZDVWH PDWHULDOV VKRXOG EH FKHPLFDOO\ GLVLQIHFWHG RU SUHIHUDEO\
GHFRQWDPLQDWHGLQDVWHDPDXWRFODYH,QIHFWLRXVZDVWHPDWHULDOVWREHUHPRYHGIURPD%6&
VKRXOG EH SODFHG LQ D SDQ RU WUD\ WKDWFDQ EH FRYHUHG GXULQJ WUDQVSRUW WR WKH DXWRFODYH RU
SODFHG LQ D ELRKD]DUG DXWRFODYH EDJ %\ SODFLQJ DQ LQFK RU WZR RI ZDWHULQ WKH EDJ EHIRUH
VHDOLQJLWE\WUDQVSRUWVWHDPZLOOEHJHQHUDWHGZLWKLQWKHEDJGXULQJWKHDXWRFODYHF\FOH

7KH VXSHUYLVRU RI D %6/ ODERUDWRU\ VKRXOG EH D FRPSHWHQW VFLHQWLVW ZKR KDV D
WHFKQLFDO XQGHUVWDQGLQJ RI WKH ULVNV DVVRFLDWHG ZLWK WKH PLFURELRORJLFDO DJHQWV LQ XVH 7KH
VXSHUYLVRU OLPLWV DFFHVV WR WKRVH SHUVRQVZKR KDYHUHFHLYHG WKHDSSURSULDWH LPPXQL]DWLRQV
DQGHVWDEOLVKHVWKHSHUVRQDOSURWHFWLYHVWDQGDUGVIRUWKHODERUDWRU\KHVKHLVDOVRUHVSRQVLEOH
IRUGHYHORSLQJWKHODE¶VELRORJLFDOVDIHW\PDQXDO/DERUDWRU\SHUVRQQHOVKRXOGEHDZDUHRI
WKHSRWHQWLDOKD]DUGVDVVRFLDWHGZLWKWKHZRUNDQGEHSURILFLHQWLQWKHVSHFLILHGSUDFWLFHVDQG
SURFHGXUHV

%LRVDIHW\/HYHO

%6/ LV VXLWDEOH IRU ZRUN ZLWK LQIHFWLRXV DJHQWV ZKLFK PD\ FDXVH VHULRXV RU
SRWHQWLDOO\OHWKDOGLVHDVHVDVDUHVXOWRIH[SRVXUHE\WKHLQKDODWLRQURXWH%6/ODERUDWRULHV
VKRXOG EH ORFDWHG DZD\ IURP KLJKWUDIILF DUHDV ([DPSOHV RI DJHQWV WKDW VKRXOG EH
PDQLSXODWHGDW%6/DUH 0WXEHUFXORVLV UHVHDUFK DFWLYLWLHV  6W/RXLVHQFHSKDOLWLVYLUXV
DQG&R[LHOODEXUQHWLL

7KHUH DUH VRPH VSHFLILF VHFRQGDU\ EDUULHUV QHHGHG DW %6/ WKDW WHQG WR VHW WKHVH
ODERUDWRULHVDSDUWIURP%6/$W&'&WKHFXUUHQWPDLQ%6/ODERUDWRULHVDUHORFDWHGLQD
XQLTXH KLJK FRQWDLQPHQW EXLOGLQJ WKDW DOVR KRXVHV WKH %6/ ODERUDWRU\ $ W\SLFDO %6/
ODERUDWRU\OD\RXWLVVKRZQLQ7KHVHODERUDWRULHVDUHFKDUDFWHUL]HGE\KDYLQJDGRXEOHGRRU
HQWU\ VKRZQKHUHDVDQ DQWHURRPRWKHUFRQILJXUDWLRQVDUHDOVRXVHG %HFDXVHWKHDJHQWV
PDQLSXODWHGDW%6/DUHWUDQVPLVVLEOHE\WKHDHURVROURXWHSDUWLFXODUDWWHQWLRQLVJLYHQWR
DLUPRYHPHQWLQWKHVHODEV$LUPRYHVIURPDUHDVRIOHVVHUFRQWDPLQDWLRQWRDUHDVRIKLJKHU
FRQWDPLQDWLRQ VXFK DV IURP WKH FRUULGRU LQWR WKH ODERUDWRU\ $LU PRYHPHQW LV DOVR VLQJOH
SDVV H[KDXVWDLULVQRW UHFLUFXODWHGWRRWKHUURRPV([KDXVWDLUGRHV QRW KDYH WR EH +(3$
ILOWHUHGXQOHVVORFDOFRQGLWLRQVDUHVXFKWKDWUHHQWUDLQPHQWLQWREXLOGLQJDLUVXSSO\V\VWHPVLV
XQDYRLGDEOH

$OOZRUNWKDWPD\FUHDWHDHURVROVRUVSODWWHULVGRQHLQVLGHDELRORJLFDOVDIHW\FDELQHW
:DOO FHLOLQJ DQG IORRU SHQHWUDWLRQV DUH VHDOHG WR NHHS DHURVROV LQ DQG WR NHHS JDVHRXV
GHFRQWDPLQDQWV LQ 7KH IORRU LV PRQROLWKLF DQG WKHUH DUH FRQWLQXRXV FRYH PROGLQJV WKDW
H[WHQG DW OHDVW  XS WKH ZDOO $FRXVWLF WLOHV DUH QRW XVHG LQ %6/ ODERUDWRULHV FHLOLQJV
VKRXOGEHZDWHUSURRIIRUHDVHRIFOHDQLQJ&HQWULIXJHWXEHVDUHSODFHGLQWRFRQWDLQPHQWFXSV
RU KHDGV LQ WKH %6& WUDQVIHUUHG WR WKH FHQWULIXJH VSXQ WKHQ UHWXUQHG WR WKH %6& WR EH
XQORDGHG ,Q VRPH ODERUDWRULHV WKH FHQWULIXJHV WKHPVHOYHV DUH HQFORVHG LQ D YHQWHG DUHD WR
PLQLPL]H SRVVLEOH DHURVRO H[SRVXUHV FUHDWHG LQ WKH HYHQW RI D FHQWULIXJH IDLOXUH 9DFXXP
OLQHV DUH SURWHFWHG ZLWK +(3$ ILOWHUV VR WKDW PDLQWHQDQFH SHUVRQQHO DUH QRW H[SRVHG WR
LQIHFWLRXVDHURVROV

6WDQGDUGPLFURELRORJLFDOSUDFWLFHVDUHWKHVDPHDVIRU%6/DQG%6/ODERUDWRULHV
&ODVV,,W\SH$ELRORJLFDOVDIHW\FDELQHWVDUHVXLWDEOHLQ%6/ODERUDWRULHV6RPHWLPHV&ODVV
,, W\SH % FDELQHWV DUH LQVWDOOHG UHTXLULQJ WKLPEOH FRQQHFWLRQ WR WKH EXLOGLQJ H[KDXVW
V\VWHPV'HSHQGLQJRQWKHQDWXUHRIWKHZRUNEHLQJGRQHLQWKH%6/ODERUDWRU\DGGLWLRQDO
SHUVRQQHOSURWHFWLYHGHYLFHVPD\EHZRUQVXFKDVUHVSLUDWRUV:KHQSXOPRQDU\SURWHFWLRQLV

ϭϴ

UHTXLUHG WKH ODERUDWRULDQV QHHG WR KDYH DSSURSULDWH PHGLFDO HYDOXDWLRQV DQG EH WUDLQHG LQ
SURSHUILWWHVWLQJDQGFDUHRIWKHLUUHVSLUDWRUV

6XSHUYLVRUV RI %6/ ODERUDWRULHV VKRXOG EH FRPSHWHQW VFLHQWLVWV H[SHULHQFHG LQ
ZRUNLQJZLWKWKHDJHQWV7KH\HVWDEOLVKFULWHULDIRUHQWU\LQWRWKHODERUDWRU\UHVWULFWDFFHVV
GHYHORS DSSURSULDWH SUDFWLFHV DQG SURFHGXUHV DQG WUDLQ WKH ODERUDWRULDQV 7KH\ DUH DOVR
UHVSRQVLEOHIRUGHYHORSLQJWKHODERUDWRU\VDIHW\ PDQXDO 7KH ODE SHUVRQQHO PXVW ULJRURXVO\
IROORZ WKH HVWDEOLVKHG JXLGHOLQHV GHPRQVWUDWH SURILFLHQF\ LQ SHUIRUPLQJ WKHLU YDULRXV
SURFHGXUHV DQG UHFHLYH DSSURSULDWH WUDLQLQJ 7KH\ PXVW SDUWLFLSDWH LQ VSHFLILHG PHGLFDO
VXUYHLOODQFHSURJUDPVDQGUHSRUWDOOLQFLGHQWVWKDWFRQVWLWXWHSRWHQWLDOH[SRVXUHV

%LRVDIHW\/HYHO

7KLV OHYHO LV UHTXLUHG IRU ZRUN ZLWK GDQJHURXV DQG H[RWLF DJHQWV WKDW SRVH D KLJK
LQGLYLGXDOULVNRIDHURVROWUDQVPLWWHGODERUDWRU\LQIHFWLRQVDJHQWVZKLFKFDXVHVHYHUHWRIDWDO
GLVHDVHLQKXPDQVIRUZKLFKYDFFLQHVRURWKHUWUHDWPHQWVDUHQRWDYDLODEOHVXFKDV%ROLYLDQ
DQG $UJHQWLQH KHPRUUKDJLF IHYHUV 0DUEXUJ YLUXV (EROD YLUXV /DVVD IHYHU &ULPHDQ
&RQJRQKHPRUUKDJLF IHYHU DQG RWKHU YDULRXV KHPRUUKDJLF GLVHDVHV :KHQ GHDOLQJ ZLWK
ELRORJLFDOKD]DUGVDWWKLVOHYHOWKHXVHRID+D]PDWVXLWDQGDVHOIFRQWDLQHGR[\JHQVXSSO\LV
PDQGDWRU\ 7KH HQWUDQFH DQG H[LW RI D /HYHO )RXU ELRODE ZLOO FRQWDLQ PXOWLSOH VKRZHUV D
YDFXXPURRPDQXOWUDYLROHWOLJKWURRPDQGRWKHUVDIHW\SUHFDXWLRQVGHVLJQHGWRGHVWUR\DOO
WUDFHVRIWKHELRKD]DUG0XOWLSOHDLUORFNVDUHXVHGDQGDUHHOHFWURQLFDOO\VHFXUHGWRSUHYHQW
ERWKGRRUVRSHQLQJDWWKHVDPHWLPH$OODLUDQGZDWHUVHUYLFHJRLQJWRDQGFRPLQJIURPD
ELRVDIHW\ OHYHO  ODE ZLOO XQGHUJR VLPLODU GHFRQWDPLQDWLRQ SURFHGXUHV WR HOLPLQDWH WKH
SRVVLELOLW\RIDQDFFLGHQWDOUHOHDVH

$JHQWVZLWKDFORVHRULGHQWLFDODQWLJHQLFUHODWLRQVKLSWR%LRVDIHW\/HYHODJHQWVDUH
KDQGOHGDWWKLVOHYHOXQWLOVXIILFLHQWGDWDLVREWDLQHGHLWKHUWRFRQILUPFRQWLQXHGZRUNDWWKLV
OHYHORUWRZRUNZLWKWKHPDWDORZHUOHYHO

0HPEHUV RI WKH ODERUDWRU\ VWDII KDYH VSHFLILF DQG WKRURXJK WUDLQLQJ LQ KDQGOLQJ
H[WUHPHO\ KD]DUGRXV LQIHFWLRXV DJHQWV DQG WKH\ XQGHUVWDQG WKH SULPDU\ DQG VHFRQGDU\
FRQWDLQPHQWIXQFWLRQVRIWKHVWDQGDUGDQGVSHFLDOSUDFWLFHVWKHFRQWDLQPHQWHTXLSPHQWDQG
WKH ODERUDWRU\ GHVLJQ FKDUDFWHULVWLFV 7KH\ DUH VXSHUYLVHG E\ TXDOLILHG VFLHQWLVWV ZKR DUH
WUDLQHG DQG H[SHULHQFHG LQ ZRUNLQJ ZLWK WKHVH DJHQWV $FFHVV WR WKH ODERUDWRU\ LV VWULFWO\
FRQWUROOHGE\WKHODERUDWRU\GLUHFWRU

7KH IDFLOLW\ LV HLWKHU LQ D VHSDUDWH EXLOGLQJ RU LQ D FRQWUROOHG DUHD ZLWKLQ D EXLOGLQJ
ZKLFK LV FRPSOHWHO\ LVRODWHG IURP DOO RWKHU DUHDV RI WKH EXLOGLQJ $ VSHFLILF IDFLOLW\
RSHUDWLRQV PDQXDO LV SUHSDUHG RU DGRSWHG %XLOGLQJ SURWRFROV IRU SUHYHQWLQJ FRQWDPLQDWLRQ
RIWHQXVHQHJDWLYHO\SUHVVXUL]HGIDFLOLWLHVZKLFKLIFRPSURPLVHGZRXOGVHYHUHO\LQKLELWWKH
FRQWDLQPHQWRIDQRXWEUHDNRIDHURVROSDWKRJHQV

:LWKLQZRUNDUHDVRIWKHIDFLOLW\DOODFWLYLWLHVDUHFRQILQHGWR&ODVV,,,ELRORJLFDOVDIHW\
FDELQHWV RU &ODVV ,, ELRORJLFDO VDIHW\ FDELQHWV XVHG ZLWK RQHSLHFH SRVLWLYH SUHVVXUH
SHUVRQQHO VXLWV YHQWLODWHG E\ D OLIH VXSSRUW V\VWHP 7KH %LRVDIHW\ /HYHO  ODERUDWRU\ KDV
VSHFLDOHQJLQHHULQJDQGGHVLJQIHDWXUHVWRSUHYHQWPLFURRUJDQLVPVIURPEHLQJGLVVHPLQDWHG
LQWRWKHHQYLURQPHQW7KHODERUDWRU\LVNHSWDWQHJDWLYHDLUSUHVVXUHVRWKDWDLUIORZVLQWRWKH
URRPLIWKHEDUULHULVSHQHWUDWHGRUEUHDFKHG)XUWKHUPRUHDQDLUORFNLVXVHGGXULQJSHUVRQQHO
HQWU\DQGH[LW

ϭϵ

 
7KHJXLGHOLQHVSUHVHQWHGLQWKH&'&1,+SXEOLFDWLRQ%LRVDIHW\LQ0LFURELRORJLFDODQG
%LRPHGLFDO /DERUDWRULHV SUHVHQW VWDQGDUG DQG VSHFLDO SUDFWLFHV VDIHW\ HTXLSPHQW
UHFRPPHQGDWLRQVDQGSHUIRUPDQFHVWDQGDUGVIRUWKHIDFLOLWLHVWKDWWDNHQWRJHWKHUVKRXOGEH
FRQVLGHUHGDVRSWLPDOIRUPRVWODERUDWRU\VLWXDWLRQV7KHUHPD\EH LQVWDQFHVZKHUH XQLTXH
QHHGV XQNQRZQ KD]DUGV DVVRFLDWHG ZLWK XQNQRZQ SDWKRJHQV RU RWKHU FRQWULEXWLQJ
UHTXLUHPHQWV ZLOO FDXVH VXSHUYLVRUV RU ELRVDIHW\ SURIHVVLRQDOV WR VHHN KLJKHU ELRVDIHW\
UHTXLUHPHQWV 7KHVH FDQ EH HVWDEOLVKHG DIWHU DSSURSULDWH ULVN DVVHVVPHQWV KDYH EHHQ
FRQGXFWHG

7DEOH/LVWRI%LRVDIHW\OHYHOV

1DPH /RFDWLRQ /HYHO 'HVFULSWLRQ

9LURORJ\ /DERUDWRU\ $XVWUDOLD
RI WKH 4XHHQVODQG 4XHHQVODQG&RRSHUV
'HSDUWPHQWRI+HDOWK 3ODLQV  
$XVWUDOLDQ $QLPDO $XVWUDOLD 9LFWRULD
+HDOWK/DERUDWRU\ *HHORQJ  
,QIHFWLRXV 'LVHDVHV
8QLW 6W-RKQ V ,QGLD%DQJDORUH
5HVHDUFK,QVWLWXWH   
2QH RI WKH SUHPLHU UHVHDUFK LQVWLWXWH 
$OO ,QGLD ,QVWLWXWH RI FRQGXFWV VWXGLHV RQ PDMRU SDWKRJHQLF
0HGLFDO6FLHQFHV ,QGLD1HZ'HOKL RUJDQLVPV+DVEHHQFRQWULEXWHGLQGLVFRYHULQJ
   QRYHOVWUDLQV YDFFLQHV
1DWLRQDO -$/0$
,QVWLWXWH IRU /HSURV\
 2WKHU
0\FREDFWHULDO ,QGLD$JUD
'LVHDVHV  7KLV IDFLOLW\ GHDOV ZLWK WKH 0\FREDFWHULDO
1&-,/20' $JUD   VWUDLQV WKHLUSDWKRJHQLFLW\ HSLGHPLRORJ\
1DWLRQDO +LJK 6HFXULW\ /DERUDWRU\ 2SHUDWHV
1DWLRQDO +LJK $XVWUDOLD 9LFWRULD XQGHU WKH DXVSLFH RI WKH 9LFWRULD ,QIHFWLRXV
6HFXULW\/DERUDWRU\ 1RUWK0HOERXUQH  'LVHDVHV5HIHUHQFH/DERUDWRU\
&XUWLQ 8QLYHUVLW\ RI $XVWUDOLD :HVWHUQ
7HFKQRORJ\ $XVWUDOLD%HQWOH\  
)XQGDomR 2VZDOGR %UD]LO 5LR GH ,W LV XQFOHDU ZKHWKHU WKLV IDFLOLW\ RSHUDWHV DV D
&UX] -DQHLUR  %6/%UD]LOGRHVQ WKDYHDQ\%6/IDFLOLWLHV
8QLYHUVLW\ RI 6mR ,W LV XQFOHDU ZKHWKHU WKLV IDFLOLW\ RSHUDWHV DV D
3DXOR %UD]LO6mR3DXOR  %6/%UD]LOGRHVQ WKDYHDQ\%6/IDFLOLWLHV
,QVWLWXWR$GROI/XW] %UD]LO  
,QVWLWXWR%XWDQWDQ %UD]LO  
%ULWLVK &ROXPELD
&HQWUH IRU 'LVHDVH &DQDGD %ULWLVK 7KH %ULWLVK &ROXPELD &HQWUH IRU 'LVHDVH
&RQWURO &ROXPELD  &RQWURORSHUDWHVWKUHHELRVDIHW\OHYHOODEV
/RFDWHG DW WKH &DQDGLDQ 6FLHQFH &HQWUH IRU
1DWLRQDO +XPDQDQG$QLPDO+HDOWKLWLVMRLQWO\RSHUDWHG
0LFURELRORJ\ &DQDGD 0DQLWRED E\WKH3XEOLF+HDOWK$JHQF\RI&DQDGDDQGWKH
/DERUDWRU\ :LQQLSHJ  &DQDGLDQ)RRG,QVSHFWLRQ$JHQF\
&HQWUH 1DWLRQDO GH
%LRORJLH &DQDGD 4XHEHF /RFDWHG DW WKH ,QVWLWXW QDWLRQDO GH OD UHFKHUFKH
([SpULPHQWDOH /DYDO  VFLHQWLILTXH

ϮϬ

 1DWLRQDO ,QVWLWXWH IRU )LQODQG 7LONDQPlNL 'RFXPHQW IURP 1DWLRQDO ,QVWLWXWH IRU +HDOWK
+HDOWKDQG:HOIDUH +HOVLQNL  DQG:HOIDUHWKDWPHQWLRVWKHIDFLOLW\
-HDQ 0pULHX[ ODERUDWRU\ LV D FRRSHUDWLRQ
EHWZHHQ WKH 3DVWHXU ,QVWLWXWH DQG ,16(50
/DERUDWRLUH 3 -HDQ )UDQFH 5K{QH 1RWH WKDW LQ )UDQFH LW LV 3 IRU 3DWKRJHQ RU
0pULHX[ $OSHV/\RQ  3URWHFWLRQOHYHO
&HQWUH ,QWHUQDWLRQDO 7KLV IDFLOLW\ LV RSHUDWHG E\ D UHVHDUFK
GH 5HFKHUFKHV RUJDQL]DWLRQ VXSSRUWHG E\ WKH )UHQFK
0pGLFDOHV GH JRYHUQPHQWRSHUDWHV:HVW$IULFD VRQO\%6/
)UDQFHYLOOH *DERQ  ODE
7KH IDFLOLW\ ZDV OLFHQFHG IRU FRQVWUXFWLRQ E\
5REHUW.RFK,QVWLWXWH *HUPDQ\%HUOLQ  &LW\RI%HUOLQRQ1RYHPEHU
%HUQKDUG 1RFKW
,QVWLWXWH IRU 7URSLFDO
0HGLFLQH *HUPDQ\+DPEXUJ  
3KLOLSSV8QLYHUVLW\RI 7KHIDFLOLW\LVOLFHQFHGWRZRUNZLWKJHQHWLFDOO\
0DUEXUJ *HUPDQ\0DUEXUJ  PRGLILHGRUJDQLVPV
)ULHGULFK /RHIIOHU
,QVWLWXWH RQ ,VODQG *HUPDQ\ ,VODQG
5LHPV 5LHPV  'HDOVHVSHFLDOO\ZLWKYLURORJ\
(YDQJHOLVPRV *UHHFH$WKHQV  
&UHWH 8QLYHUVLW\
3DJQH KRVSLWDO
&OLQLFDO EDFWHULRORJ\
ODE *UHHFH+HUDNOLRQ  
+LJK6HFXULW\$QLPDO 7KLV IDFLOLW\ GHDOV HVSHFLDOO\ WR ]RRQRWLF
'LVHDVH /DERUDWRU\ RUJDQLVPV DQG HPHUJLQJ LQIHFWLRXV GLVHDVH
+6$'/  ,QGLD%KRSDO  WKUHDWV
2SHUDWHG E\ ,QVWLWXWH RI 7URSLFDO 'LVHDVH 
,QVWLWXWH RI 7URSLFDO ,QGRQHVLD(DVW-DYD $LUODQJJD 8QLYHUVLW\ %XLOG &RRSHUDWLRQ ZLWK
'LVHDVH ,7'  6XUDED\D  -DSDQ
$ XQLYHUVLW\ KRVSLWDO LQ 3ROR 8QLYHUVLWDULR LW
$]LHQGD 2VSHGDOLHUD ,WDO\ /RPEDUG\ FRQWDLQV WZR VSHFLDO YHKLFOHV IRU WUDQVSRUWLQJ
2VSHGDOH/XLJL6DFFR 0LODQR  LQIHFWLRXVSHUVRQV
7KLV IDFLOLW\ WUDQV  1DWLRQDO ,QVWLWXWH RI
,VWLWXWR 1D]LRQDOH ,QIHFWLRXV'LVHDVHVRSHUDWHVZLWKLQWKH/D]]DUR
0DODWWLH,QIHWWLYH ,WDO\5RPH5RPH  6SDOODQ]DQL+RVSLWDO
,QVWLWXWH IRU 0HGLFDO 7KLV IDFLOLW\ LV DEOH WR FRQGXFW UHVHDUFK DQG
5HVHDUFK ,05  0DOD\VLD .XDOD WHVWV RQ DFDURORJ\ EDFWHULRORJ\ PHGLFDO
0LQLVWU\RI+HDOWK /XPSXU  HQWRPRORJ\SDUDVLWRORJ\DQGYLURORJ\
/RFDWHG DW 1DWLRQDO ,QVWLWXWH IRU ,QIHFWLRXV
'LVHDVHV'HSDUWPHQWRI9LURORJ\,WKLVODEKDV
WKHSRWHQWLDORIRSHUDWLQJDVD%6/KRZHYHU
LW LV OLPLWHG WR SHUIRUP ZRUN RQ RQO\ %6/
1DWLRQDO ,QVWLWXWH IRU DJHQWV GXH WR RSSRVLWLRQ IURP ORFDO UHVLGHQWV
,QIHFWLRXV'LVHDVHV -DSDQ.DQW{7RN\R  DQGFRPPXQLWLHV
,QVWLWXWH RI 3K\VLFDO
DQG &KHPLFDO -DSDQ .DQW{
5HVHDUFK 7VXNXED  7KLVLVDQRQRSHUDWLQJ%6/IDFLOLW\
1HWKHUODQGV 1DWLRQDO
,QVWLWXWH IRU 3XEOLF &XUUHQWO\XQGHUFRQVWUXFWLRQLWLVSODQQHGWREH
+HDOWK DQG WKH 1HWKHUODQGV ILQLVKHG E\ WKH HQG RI  ,W LV SODQQHG WR
(QYLURQPHQW 5,90  %LOWKRYHQ  RSHUDWHDVD%6/DQGD%6/IDFLOLW\

Ϯϭ

 :XKDQ ,QVWLWXWH RI 9LURORJ\ DOUHDG\ KRVWV D
%6/ ODERUDWRU\ $ GLVWLQFW %6/ IDFLOLW\ LV
:XKDQ ,QVWLWXWH RI FXUUHQWO\EHLQJEXLOWEDVHGRQ3VWDQGDUGVWKH
9LURORJ\ RI WKH 3HRSOH V 5HSXEOLF RI RULJLQDO WHFKQRORJ\ IRU FRQILQHPHQW GHYHORSHG
&KLQHVH $FDGHP\ RI &KLQD +XEHL E\)UDQFH,WZLOOEHWKHILUVWDWOHYHOLQ&KLQD
6FLHQFHV :XKDQ  XQGHUWKHGLUHFWLRQRI6KL=KHQJOL
6WDWH5HVHDUFK&HQWHU
RI 9LURORJ\ DQG ,W LV RQH RI WZR IDFLOLWLHV LQ WKH ZRUOG WKDW
%LRWHFKQRORJ\ 5XVVLD 1RYRVLELUVN RIILFLDOO\ KROG VPDOOSR[ 7KH RWKHU 5XVVLDQ
9(&725 2EODVW.ROWVRYR  %6/IDFLOLWLHVKDYHEHHQGLVPDQWOHG
'HIHQFH 6FLHQFH 2UJDQL]DWLRQ JRDO LV WR
FRQGXFW DXWRSVLHV GXULQJ D SRWHQWLDO GHDGO\
HSLGHPLFRXWEUHDN6LQJDSRUHDOVRKDVDPRELOH
'HIHQFH 6FLHQFH %6/DXWRSV\IDFLOLW\SHUKDSVWKHRQO\RQHRI
2UJDQL]DWLRQ '62  6LQJDSRUH  LWVNLQGLQWKHZRUOG
1DWLRQDO ,QVWLWXWH IRU &RPPXQLFDEOH 'LVHDVHV
1DWLRQDO ,QVWLWXWH IRU RI 6SHFLDO 3DWKRJHQV 8QLW LV RQH RI RQO\ WZR
&RPPXQLFDEOH 6RXWK $IULFD %6/ IDFLOLWLHV LQ $IULFD EXW WKH RQO\ VXLW
'LVHDVHV -RKDQQHVEXUJ  ODERUDWRU\RQWKHFRQWLQHQW
7KH13+/LVHVWDEOLVKHGWRGHYHORSODERUDWRU\
1DWLRQDO 3XEOLF EDVHG VXUYHLOODQFH V\VWHPV IRU LQIHFWLRXV
+HDOWK /DERUDWRU\ GLVHDVHVRIHSLGHPLFDQGSDQGHPLFSRWHQWLDODV
13+/  0LQLVWU\ RI 0DOD\VLD 6XQJDL SDUW RI DQ HDUO\ ZDUQLQJ V\VWHP DQG UHVSRQVH
+HDOWK %XORK6HODQJRU  VWUDWHJLHVIRURXWEUHDNVRILQIHFWLRXVGLVHDVHV
6ZHGLVK ,QVWLWXWH IRU
,QIHFWLRXV 'LVHDVH 6ZHGLVK,QVWLWXWHIRU,QIHFWLRXV'LVHDVH&RQWURO
&RQWURO 6ZHGHQ6ROQD  LV6FDQGLQDYLD V3IDFLOLW\
,QVWLWXWH RI 9LURORJ\ 7KLV IDFLOLW\ RQO\ GHDOV ZLWK DQLPDO GLVHDVHV
DQG ZKLFK GR QRW WUDQVPLW WR KXPDQV DQG LV WKH
,PPXQRSURSK\OD[LV 6ZLW]HUODQG RQO\ 3 IDFLOLW\ ZKHUH FRPSOHWH LVRODWLRQ VXLWV
,9,  0LWWHOKlXVHUQ  DUHQRWXVHG
+LJK &RQWDLQPHQW 8QGHU FRQVWUXFWLRQ LW ZLOO VWDUW RSHUDWLRQV LQ
/DERUDWRU\ ''36  7KLV ODERUDWRU\ ZLOO FRPSO\ ZLWK %6/
6L/DE  6ZLW]HUODQG6SLH]  VWDQGDUGV
3UHYHQWLYH 0HGLFDO
,QVWLWXWH RI 52&
0LQLVWU\ RI 1DWLRQDO 5HSXEOLF RI &KLQD
'HIHQVH 7DLZDQ   
.ZHQ\DQJ
/DERUDWRU\ &HQWHU RI 5HSXEOLF RI &KLQD 3DUW RI WKH 'HSDUWPHQW RI +HDOWK 5HSXEOLF RI
'LVHDVH&RQWURO 7DLZDQ   &KLQD
+HDOWK 3URWHFWLRQ
$JHQF\ V &HQWUH IRU 8QLWHG .LQJGRP
,QIHFWLRQV &ROLQGDOH  /RFDWHGLQWKH9LUDO=RRQRVLVXQLW
1DWLRQDO ,QVWLWXWH IRU 8QLWHG .LQJGRP
0HGLFDO5HVHDUFK /RQGRQ  
&KHPLFDO DQG
%LRORJLFDO 'HIHQFH 8QLWHG .LQJGRP
(VWDEOLVKPHQW 3RUWRQ'RZQ  
&HQWHUV IRU 'LVHDVH 8QLWHG 6WDWHV RI &XUUHQWO\RSHUDWHVLQWZREXLOGLQJV2QHRIWZR
&RQWURO DQG $PHULFD *HRUJLD IDFLOLWLHV LQ WKH ZRUOG WKDW RIILFLDOO\ KROG
3UHYHQWLRQ $WODQWD  VPDOOSR[
*HRUJH 0DVRQ 8QLWHG 6WDWHV RI 7KLVIDFLOLW\LVFXUUHQWO\XQGHUFRQVWUXFWLRQRQD
8QLYHUVLW\ $PHULFD 9LUJLQLD  DFUH VLWH DGMDFHQW WR *HRUJH 0DVRQ

ϮϮ

 %LRPHGLFDO 5HVHDUFK 0DQDVVDV 8QLYHUVLW\ V 3ULQFH :LOOLDP &DPSXV ,W LV
/DERUDWRU\ VFKHGXOHG WR EH IXOO\ RSHUDWLRQDO LQ WKH 6SULQJ
RI
8QLWHG 6WDWHV RI
*HRUJLD 6WDWH $PHULFD *HRUJLD
8QLYHUVLW\ $WODQWD  ,VDQROGHUGHVLJQJORYHER[IDFLOLW\
8QGHU FRQVWUXFWLRQ 7KLV IDFLOLW\ ZLOO EH
8QLWHG 6WDWHV RI RSHUDWHG E\ 1DWLRQDO ,QVWLWXWH RI $OOHUJ\ DQG
,QWHJUDWHG 5HVHDUFK $PHULFD 0DU\ODQG ,QIHFWLRXV 'LVHDVHV 1,$,'  LW LV SODQQHG WR
)DFLOLW\ )RUW'HWULFN  EHJLQRSHUDWLQJDWDWWKHHDUOLHVW
1DWLRQDO %LRGHIHQVH
$QDO\VLV DQG 8QLWHG 6WDWHV RI
&RXQWHUPHDVXUHV $PHULFD 0DU\ODQG 8QGHU FRQVWUXFWLRQ LW ZLOO EH RSHUDWHG IRU WKH
&HQWHU 1%$&&  )RUW'HWULFN  'HSDUWPHQWRI+RPHODQG6HFXULW\
8QLWHG 6WDWHV RI
1DWLRQDO ,QVWLWXWHV RI $PHULFD 0DU\ODQG /RFDWHG RQ WKH 1,+ &DPSXV LW FXUUHQWO\ RQO\
+HDOWK 1,+  %HWKHVGD  RSHUDWHVZLWK%6/DJHQWV
86 $UP\ 0HGLFDO
5HVHDUFK ,QVWLWXWH RI 8QLWHG 6WDWHV RI
,QIHFWLRXV 'LVHDVHV $PHULFD 0DU\ODQG
86$05,,'  )RUW'HWULFN  2OGEXLOGLQJ
86 $UP\ 0HGLFDO
5HVHDUFK ,QVWLWXWH RI 8QLWHG 6WDWHV RI
,QIHFWLRXV 'LVHDVHV $PHULFD 0DU\ODQG 1HZ EXLOGLQJ FXUUHQWO\ XQGHU GHVLJQ
86$05,,'  )RUW'HWULFN  FRQVWUXFWLRQ
8QLWHG 6WDWHV RI
1DWLRQDO (PHUJLQJ $PHULFD 8QGHU FRQVWUXFWLRQ E\ %RVWRQ 8QLYHUVLW\
,QIHFWLRXV 'LVHDVHV 0DVVDFKXVHWWV EXLOGLQJDQGVWDIIWUDLQLQJFRPSOHWHZDLWLQJIRU
/DERUDWRU\ 1(,'/  %RVWRQ  UHJXODWRU\DSSURYDO
1,$,' 5RFN\ 8QLWHG 6WDWHV RI
0RXQWDLQ $PHULFD 0RQWDQD 8QGHU FRQVWUXFWLRQ LW LV SODQQHG WR EHJLQ
/DERUDWRULHV +DPLOWRQ  RSHUDWLRQLQDWWKHHDUOLHVW
6WRQ\ %URRN 2SHUDWHG E\ 6WDWH 8QLYHUVLW\ RI 1HZ <RUN DW
8QLYHUVLW\ &HQWHUV 6WRQ\%URRND%6/IDFLOLW\VWXG\LQJ%RUUHOLD
IRU 0ROHFXODU 8QLWHG 6WDWHV RI EXUJGRUIHUL /\PH 'LVHDVH  <HUVLQLD SHVWLV
0HGLFLQH &HQWHU IRU $PHULFD1HZ<RUN %XERQLF SODJXH  DQG )UDQFLVHOOD WXODUHQVLV
,QIHFWLRXV'LVHDVHV 6WRQ\%URRN  5DEELWIHYHU 
8QLWHG 6WDWHV RI
8QLYHUVLW\ RI $PHULFD 2KLR 8QLYHUVLW\ RI &LQFLQQDWL 0HGLFDO 6FLHQFHV
&LQFLQQDWL &LQFLQQDWL  %XLOGLQJ
8QLWHG 6WDWHV RI
%DWWHOOH 0HPRULDO $PHULFD2KLR:HVW
,QVWLWXWH -HIIHUVRQ  
1DWLRQDO 8QLWHG 6WDWHV RI
%LRFRQWDLQPHQW $PHULFD 7H[DV 2SHQHG LQ  IDFLOLW\ LV RSHUDWHG E\ WKH
)DFLOLW\ *DOYHVWRQ  8QLYHUVLW\RI7H[DV0HGLFDO%UDQFK
8QLWHG 6WDWHV RI
$PHULFD 7H[DV 2SHUDWHG E\ WKH 8QLYHUVLW\ RI 7H[DV 0HGLFDO
6KRSH/DERUDWRU\ *DOYHVWRQ  %UDQFK 870% 
6RXWKZHVW 8QLWHG 6WDWHV RI
)RXQGDWLRQ IRU $PHULFD 7H[DV 6DQ
%LRPHGLFDO5HVHDUFK $QWRQLR  7KHRQO\SULYDWHO\RZQHG%6/ODELQWKH86
'LYLVLRQ RI 8QLWHG 6WDWHV RI 7KLV IDFLOLW\ LV SDUW RI WKH 'HSDUWPHQW RI
&RQVROLGDWHG $PHULFD 9LUJLQLD  *HQHUDO 6HUYLFHV RI WKH &RPPRQZHDOWK RI

Ϯϯ

 /DERUDWRU\6HUYLFHV 5LFKPRQG 9LUJLQLD  ,W LV VR FDOOHG VXUJH %6/
FDSDFLW\
8QLWHG 6WDWHV RI )DFLOLW\ WR EH RSHUDWHG E\ WKH 'HSDUWPHQW RI
1DWLRQDO %LR DQG $PHULFD .DQVDV +RPHODQG6HFXULW\DQGUHSODFHWKH3OXP,VODQG
$JUR'HIHQVH 6WDWH 8QLYHUVLW\ $QLPDO 'LVHDVH &HQWHU 3ODQQHG WR EH
)DFLOLW\ 1%$)  0DQKDWWDQ.DQVDV  RSHUDWLRQDOE\
8QLWHG 6WDWHV RI )DFLOLW\ VFKHGXOHG WR EH UHSODFHG E\ WKH
3OXP ,VODQG $QLPDO $PHULFD1HZ<RUN 1DWLRQDO %LR DQG $JUR'HIHQVH )DFLOLW\
'LVHDVH&HQWHU 3OXP,VODQG  5HVHDUFKHV]RRQRWLFSDWKRJHQVRQO\
6DLQW /RXLV 8QLWHG 6WDWHV RI 6DLQW /RXLV 8QLYHUVLW\ V QHZ FHQWHU IRU
8QLYHUVLW\ 'RLV\ $PHULFD 0LVVRXUL ELRPHGLFDOUHVHDUFK0RQNH\SR[LVWKHSULPDU\
5HVHDUFK%XLOGLQJ 6DLQW/RXLV  %6/DJHQWVWXGLHG
7KH 8& %HUNHOH\ %6/ )DFLOLW\ LV FXUUHQWO\
8QLWHG 6WDWHV RI KRXVHGLQDVLQJOHORFDWLRQEXWZLOOEHH[SDQGHG
8QLYHUVLW\ RI $PHULFD &DOLIRUQLD LQ  WR LQFOXGH D VHFRQG VLWH LQ D EXLOGLQJ
&DOLIRUQLD%HUNHOH\ %HUNHOH\  XQGHUFRQVWUXFWLRQ 
8QLYHUVLW\ RI 8QLWHG 6WDWHV
&DOLIRUQLD /RV &DOLIRUQLD /RV
$QJHOHV $QJHOHV  
,QVWLWXWR 1DFLRQDO GH
7HFQRORJLD
$JURSHFXDULD $UJHQWLQD %XHQRV
%XHQRV$LUHV $LUHV&DVWHODU  &DPSRDJULFROD
9HWHULQDU\ 5HVHDUFK
,QVWLWXWH 95,  7KLV IDFLOLW\ FUHDWHG D EUHDNWKURXJK LQ
'HSDUWPHQW RI 0DOD\VLD ,SRK LGHQWLI\LQJ WKH 1LSDK YLUXV ZKLFK LV FODVVLILHG
9HWHULQDU\6HUYLFHV 3HUDN  LQWHUQDWLRQDOO\DVD%6/DJHQW

6RXUFHVRI&HOO/LQHV

/DUJH QXPEHUV RI FHOO OLQHV ORRN LGHQWLFDO &HOO OLQHV ZLWK YHU\ GLIIHUHQWRULJLQV DQG
ELRORJLFDOFKDUDFWHULVWLFVW\SLFDOO\FDQQRWEHVHSDUDWHGRQJURXQGVRIPRUSKRORJ\RUFXOWXUH
FKDUDFWHULVWLFV ,QIHFWLRQ RU FRQWDPLQDWLRQ RI D FHOO OLQH ZLWK DQ DGYHQWLWLRXV YLUXV RU
P\FRSODVPD PD\ VLJQLILFDQWO\ FKDQJH WKH FKDUDFWHULVWLFV RI WKH FHOOV EXW DJDLQ VXFK
FRQWDPLQDWLRQZLOOEHLQDSSDUHQW&HOOOLQHVZLOODOVRFKDQJHZLWKWLPHLQFXOWXUHDQGWRDGG
WRDOOWKHVHQDWXUDOKD]DUGVLWLVDOOWRRHDV\WRPLVODEHORUFURVVFRQWDPLQDWHGLIIHUHQWFHOO
OLQHVLQDEXV\FHOOFXOWXUHODERUDWRU\
7KHRSSRUWXQLWLHVIRULQDGYHUWHQWO\LQWURGXFLQJHUURULQWRDFHOOOLQHDUHOLPLWOHVVDQG
HYHU SUHVHQW ,W LV LQ WKH QDWXUH RI WKH VFLHQFH WKDW RQFH LQWURGXFHG DQ HUURU ZLOO EH
SURSDJDWHGFRPSRXQGHGFRQVROLGDWHGDQGGLVVHPLQDWHG
7KHLQWHJULW\DQGELRORJLFDOFKDUDFWHULVWLFVRIDFHOOOLQHKDYHWREHDFWLYHO\PDLQWDLQHG
E\DZHOORUJDQL]HGV\VWHPRI³KXVEDQGU\´EDVHGRQV\VWHPDWLF FHOOEDQNLQJVXSSRUWHGE\
WHVWLQJUHJLPHQVLQDVWUXFWXUHGTXDOLW\DVVXUHGHQYLURQPHQW6XFKDFRQWUROOHGHQYLURQPHQW
ZLOORQO\SUHYDLOLQDGHGLFDWHGSURIHVVLRQDOO\RUJDQL]HGFHOOFXOWXUHODERUDWRU\RUFHOOEDQN
$ VPDOO UHVHDUFK ODERUDWRU\ ZLWK D KLJK WKURXJKSXW RI VKRUWWHUP UHVHDUFK VWXGHQWV D
PLQLPXP RI SHUPDQHQW ODERUDWRU\ VWDII DQG QR IRUPDO TXDOLW\ PDQDJHPHQW SURJUDP ZLOO
ILQGLWGLIILFXOWWRPDLQWDLQLWVFHOOOLQHVXQFKDQJHGRYHUPDQ\\HDUV

Ϯϰ

 )RU DOO WKHVH UHDVRQV LW LV VWURQJO\ UHFRPPHQGHG WKDW QHZ FHOO OLQHV VKRXOG RQO\ EH
DFTXLUHG IURP D VSHFLDOLVW UHSXWDEOH FXOWXUH FROOHFWLRQ VXFK DV (&$&& 0RUHRYHU LI D
ODERUDWRU\EHOLHYHVLWDOUHDG\KDVDFHUWDLQFHOOOLQHLQLWVOLTXLGQLWURJHQVWRUHWKHLGHQWLW\
DQGSXULW\RIVXFKDFHOOOLQHVKRXOGEHTXHVWLRQHGLQWKHDEVHQFHRIDZHOOUHFRUGHGFXOWXUH
KLVWRU\ DQG UHFHQW WHVW GDWD ,I WKHUH LV D GRXEW LW LV VWUDLJKWIRUZDUG DQG FRVW HIIHFWLYH WR
UHSODFHVXFKFHOOVWRFNVZLWKDXWKHQWLFDWHGPDWHULDOIURPD&XOWXUH&ROOHFWLRQ
:KHQ D &HOO &XOWXUH &ROOHFWLRQ ³DFFHVVLRQV´ D QHZ FHOO OLQH LW ZLOO FKDUDFWHUL]H WKH
FHOOOLQHXVLQJWHFKQLTXHVVXFKDVLVRHQ]\PHDQDO\VLVDQG'1$SURILOLQJVRWKDWWKHLGHQWLW\
RIWKHFHOOOLQHFDQVXEVHTXHQWO\EHYHULILHG7KH&ROOHFWLRQZLOOWKHQHVWDEOLVKDKLHUDUFK\RI
0DVWHUDQG:RUNLQJFHOOEDQNVFU\RSUHVHUYHGLQOLTXLGQLWURJHQWKDWDUHGHPRQVWUDWHGIUHH
IURP PLFURELDO FRQWDPLQDWLRQ LQFOXGLQJ P\FRSODVPD &XVWRPHUV DUH VXSSOLHG IURP WKLV
DXWKHQWLFDWHG:RUNLQJ&HOO%DQNV :&% 5HSODFHPHQW:&% VDUHPDQXIDFWXUHGIURPWKH
RULJLQDO0DVWHU&HOO%DQN 0&% DQGWKHQHZ:&%ZLOODJDLQEHIXOO\WHVWHG

0DLQ7\SHVRI&HOO&XOWXUH
3ULPDU\&XOWXUHV
3ULPDU\FXOWXUHVDUHGHULYHGGLUHFWO\IURPH[FLVHGQRUPDODQLPDOWLVVXHDQGFXOWXUHG
HLWKHUDVDQH[SODQWFXOWXUHRUIROORZLQJGLVVRFLDWLRQLQWRDVLQJOHFHOOVXVSHQVLRQE\HQ]\PH
GLJHVWLRQ 6XFK FXOWXUHV DUH LQLWLDOO\ KHWHURJHQHRXV EXW ODWHU EHFRPH GRPLQDWHG E\
ILEUREODVWV 7KH SUHSDUDWLRQ RI SULPDU\ FXOWXUHV LV ODERU LQWHQVLYH DQG WKH\ FDQ EH
PDLQWDLQHGLQYLWURRQO\IRUDOLPLWHGSHULRGRIWLPH'XULQJWKHLUUHODWLYHO\OLPLWHGOLIHVSDQ
SULPDU\FHOOVXVXDOO\UHWDLQPDQ\RIWKHGLIIHUHQWLDWHGFKDUDFWHULVWLFVRIWKHFHOOLQYLYR
&RQWLQXRXV&XOWXUHV
&RQWLQXRXV FXOWXUHV FRPSULVHG D VLQJOH FHOO W\SH WKDW FDQ EH VHULDOO\ SURSDJDWHG LQ
FXOWXUHHLWKHUIRUDOLPLWHGQXPEHURIFHOO GLYLVLRQV DSSUR[   RU RWKHUZLVHLQGHILQLWHO\
&HOOOLQHVRIDILQLWHOLIHDUHXVXDOO\GLSORLGDQGPDLQWDLQVRPHGHJUHHRIGLIIHUHQWLDWLRQ7KH
IDFW WKDW VXFK FHOO OLQHV VHQHVFH DIWHU DSSUR[LPDWHO\ WKLUW\ F\FOHV RI GLYLVLRQ PHDQV LW LV
HVVHQWLDOWRHVWDEOLVKDV\VWHPRI0DVWHUDQG:RUNLQJEDQNVWRPDLQWDLQVXFKOLQHVIRUORQJ
SHULRGV
&RQWLQXRXV FHOO OLQHV WKDW FDQ EH SURSDJDWHG LQGHILQLWHO\ JHQHUDOO\ KDYH WKLV DELOLW\
EHFDXVH WKH\ KDYH EHHQ WUDQVIRUPHG LQWR WXPRU FHOOV 7XPRU FHOO OLQHV DUH RIWHQ GHULYHG
IURPDFWXDOFOLQLFDOWXPRUVEXWWUDQVIRUPDWLRQPD\DOVREHLQGXFHGXVLQJYLUDORQFRJHQHVRU
E\ FKHPLFDO WUHDWPHQWV 7UDQVIRUPHG FHOO OLQHV SUHVHQW WKH DGYDQWDJH RI DOPRVW OLPLWOHVV
DYDLODELOLW\ EXW WKH GLVDGYDQWDJH RI KDYLQJ UHWDLQHG YHU\ OLWWOH RI WKH RULJLQDO LQ YLYR
FKDUDFWHULVWLFV
&XOWXUH0RUSKRORJ\
0RUSKRORJLFDOO\FHOOFXOWXUHVWDNHRQHRIWZRIRUPVJURZLQJHLWKHULQVXVSHQVLRQ DV
VLQJOH FHOOV RU VPDOO IUHHIORDWLQJ FOXPSV  RU DV D PRQROD\HU WKDW LV DWWDFKHG WR WKH WLVVXH
FXOWXUHIODVN7KHIRUPWDNHQE\DFHOOOLQHUHIOHFWVWKHWLVVXHIURPZKLFKLWZDVGHULYHGHJ
FHOO OLQHV GHULYHG IURPEORRG OHXNDHPLD O\PSKRPD  WHQG WR JURZ LQ VXVSHQVLRQ ZKHUHDV
FHOOV GHULYHG IURP VROLG WLVVXH OXQJV NLGQH\  WHQG WR JURZ DV PRQROD\HUV $WWDFKHG FHOO
OLQHVFDQEHFODVVLILHGDVHQGRWKHOLDOVXFKDV%$(HSLWKHOLDOVXFKDV+H/DQHXURQDOVXFK
DV6+6<<RUILEUREODVWVVXFKDV05&DQGWKHLUPRUSKRORJ\UHIOHFWWKHDUHDZLWKLQWKH
WLVVXHRIRULJLQ

Ϯϱ

 7KHUH DUH VRPH LQVWDQFHV ZKHQ FHOO FXOWXUHV PD\ JURZ DV VHPLDGKHUHQW FHOOV HJ
%ZKHUHWKHUHDSSHDUVWREHDPL[HGSRSXODWLRQRIDWWDFKHG DQG VXVSHQVLRQFHOOV )RU
WKHVH FHOO OLQHV LW LV HVVHQWLDO WKDW ERWK FHOO W\SHV DUH VXEFXOWXUHG WR PDLQWDLQ WKH
KHWHURJHQHRXVQDWXUHRIWKHFXOWXUH


7KH&HOO(QYLURQPHQW LQFOXGLQJW\SHVRIFXOWXUHPHGLXP 
,QJHQHUDOWHUPVFXOWXUHGFHOOVUHTXLUHDVWHULOHHQYLURQPHQWDQGDVXSSO\RIQXWULHQWV
IRU JURZWK ,Q DGGLWLRQ WKH FXOWXUH HQYLURQPHQW VKRXOG EH VWDEOH LQ WHUPV RI S+ DQG
WHPSHUDWXUH2YHUWKHODVW\HDUVYDULRXVGHILQHGEDVDOPHGLDW\SHVKDYHEHHQGHYHORSHG
DQG DUH QRZ DYDLODEOH FRPPHUFLDOO\ 2ULJLQDOO\ EDODQFHG VDOW VROXWLRQV ZHUH XVHG WR
PDLQWDLQFRQWUDFWLOLW\RIPDPPDOLDQKHDUWWLVVXHDQG7\URGH¶VVDOWVROXWLRQZDVGHVLJQHGIRU
XVH LQ ZRUN ZLWK SULPDU\ PDPPDOLDQ FHOOV 7KHVH KDYH VLQFH EHHQPRGLILHGDQG HQULFKHG
ZLWK DPLQR DFLGV YLWDPLQV IDWW\ DFLGV DQG OLSLGV &RQVHTXHQWO\ PHGLD VXLWDEOH IRU
VXSSRUWLQJ WKH JURZWKRI D ZLGHUDQJH RI FHOO W\SHV DUH QRZ DYDLODEOH 7KH SUHFLVH PHGLD
IRUPXODWLRQVKDYHRIWHQEHHQGHULYHGE\RSWLPL]LQJWKHFRQFHQWUDWLRQVRIHYHU\FRQVWLWXHQW
([DPSOHVRIWKHGLIIHUHQWPHGLDDQGWKHLUXVHVDUHJLYHQLQWKHWDEOHEHORZ 7DEOH 
7DEOH'LIIHUHQWW\SHVRIFXOWXUHPHGLXPDQGWKHLUXVHV
0HGLDW\SH ([DPSOHV 8VHV

%DODQFHGVDOW
VROXWLRQV +DQNV%66(DUOHVVDOWV )RUPWKHEDVLVRIPDQ\FRPSOH[PHGLD

0(0 3ULPDU\DQGGLSORLGFXOWXUHV
0RGLILFDWLRQRI0(0FRQWDLQLQJLQFUHDVHG
OHYHORIDPLQRDFLGVDQGYLWDPLQV6XSSRUWV
DZLGHUDQJHRIFHOOW\SHVLQFOXGLQJ
%DVDOPHGLD '0(0 K\EULGRPDV
 *ODVJRZVPRGLILHG0(0ZDVGHILQHGIRU
 *0(0 %+.FHOOV
2ULJLQDOO\GHULYHGIRUKXPDQOHXNDHPLF
FHOOV,WVXSSRUWVDZLGHUDQJHRIPDPPDOLDQ
530, FHOOVLQFOXGLQJK\EULGRPDV
)XUWKHUHQULFKHGPRGLILFDWLRQRI'0(0
,VFRYHV'0(0 ZKLFKVXSSRUWVKLJKGHQVLW\JURZWK
&RPSOH[PHGLD /HLERYLW]/ 'HVLJQHGIRU&2IUHHHQYLURQPHQWV
 7& 'HVLJQHGIRUFXOWXULQJLQVHFWFHOOV

 *UDFH V,QVHFW0HGLXP 

 6FKQHLGHU V,QVHFW0HGLXP 

6HUXP)UHH0HGLD
 &+2 )RUXVHLQVHUXPIUHHDSSOLFDWLRQV
 +DP)DQGGHULYDWLYHV 127(7KHVHPHGLDPXVWEHVXSSOHPHQWHG
 +DP)'0(0) ZLWKRWKHUIDFWRUVVXFKDVLQVXOLQWUDQVIHUULQ
  DQGHSLGHUPDOJURZWKIDFWRU7KHVHPHGLD
  DUHXVXDOO\+(3(6EXIIHUHG
  
  
  

Ϯϲ

   
  


6I,,6)06),QVHFW 6SHFLILFDOO\GHVLJQHGIRUXVHZLWK6ILQVHFW
,QVHFWFHOOV 0HGLXP FHOOV


%DVLF&RQVWLWXHQWVRIPHGLD

x ,QRUJDQLFVDOWV
x &DUERK\GUDWHV
x $PLQRDFLGV
x 9LWDPLQV
x )DWW\DFLGVDQGOLSLGV
x 3URWHLQVDQGSHSWLGHV
x 6HUXP

(DFKW\SHRIFRQVWLWXHQWSHUIRUPVDVSHFLILFIXQFWLRQDVRXWOLQHGEHORZ
,QRUJDQLF6DOWV
7KH LQFOXVLRQ RI LQRUJDQLF VDOWV LQ PHGLD SHUIRUPV VHYHUDO IXQFWLRQV 3ULPDULO\ WKH\
KHOS WR UHWDLQ WKH RVPRWLF EDODQFH RI WKH FHOOV DQG KHOS UHJXODWH PHPEUDQH SRWHQWLDO E\
SURYLVLRQRIVRGLXPSRWDVVLXPDQGFDOFLXPLRQV$OORIWKHVHDUHUHTXLUHGLQWKHFHOOPDWUL[
IRUFHOODWWDFKPHQWDQGDVHQ]\PHFRIDFWRUV
%XIIHULQJ6\VWHPV
0RVW FHOOV UHTXLUH S+ FRQGLWLRQV LQ WKH UDQJH    DQG FORVH FRQWURO RI S+ LV
HVVHQWLDO IRU RSWLPXP FXOWXUH FRQGLWLRQV 7KHUH DUH PDMRU YDULDWLRQV WR WKLV RSWLPXP
)LEUREODVWVSUHIHUDKLJKHUS+  ZKHUHDVFRQWLQXRXVWUDQVIRUPHGFHOOOLQHVUHTXLUH
PRUHDFLGFRQGLWLRQVS+  5HJXODWLRQRIS+LVSDUWLFXODUO\LPSRUWDQWLPPHGLDWHO\
IROORZLQJFHOOVHHGLQJZKHQDQHZFXOWXUHLVHVWDEOLVKLQJDQGLVXVXDOO\DFKLHYHGE\RQHRI
WZREXIIHULQJV\VWHPV L DQDWXUDOEXIIHULQJV\VWHPZKHUHJDVHRXV&2EDODQFHVZLWKWKH
&2  +&2 FRQWHQW RI WKH FXOWXUH PHGLXP DQG LL  FKHPLFDO EXIIHULQJ XVLQJ D ]ZLWWHULRQ
FDOOHG+(3(6
&XOWXUHVXVLQJQDWXUDOELFDUERQDWH&2EXIIHULQJV\VWHPVQHHGWREHPDLQWDLQHGLQDQ
DWPRVSKHUHRI&2LQDLUXVXDOO\VXSSOLHGLQD&2LQFXEDWRUELFDUERQDWH&2LVORZ
FRVWQRQWR[LFDQGSURYLGHVRWKHUFKHPLFDOEHQHILWVWRWKHFHOOV
+(3(6 KDV VXSHULRU EXIIHULQJ FDSDFLW\ LQ WKH S+ UDQJH    EXW LV UHODWLYHO\
H[SHQVLYH DQG FDQ EH WR[LF WR VRPH FHOO W\SHV DW KLJKHU FRQFHQWUDWLRQV +(3(6 EXIIHUHG
FXOWXUHVGRQRWUHTXLUHDFRQWUROOHGJDVHRXVDWPRVSKHUH
0RVW FRPPHUFLDO FXOWXUH PHGLD LQFOXGH SKHQRO UHG DV D S+ LQGLFDWRU VR WKDW WKH S+
VWDWXVRIWKHPHGLXPLVFRQVWDQWO\LQGLFDWHGE\WKHFRORU8VXDOO\WKHFXOWXUHPHGLXPVKRXOG
EHFKDQJHGUHSOHQLVKHGLIWKHFRORUWXUQV\HOORZ DFLG RUSXUSOH DONDOL 



Ϯϳ

&DUERK\GUDWHV
7KH PDLQ VRXUFH RI HQHUJ\ LV GHULYHG IURP FDUERK\GUDWHV JHQHUDOO\ LQ WKH IRUP RI
VXJDUV 7KH PDMRU VXJDUV XVHG DUH JOXFRVH DQG JDODFWRVH KRZHYHU VRPH PHGLD FRQWDLQ
PDOWRVH RU IUXFWRVH 7KH FRQFHQWUDWLRQ RI VXJDU YDULHV IURP EDVDO PHGLD FRQWDLQLQJ JO WR
JOLQVRPHPRUHFRPSOH[PHGLD0HGLDFRQWDLQLQJWKHKLJKHUFRQFHQWUDWLRQRIVXJDUVDUH
DEOHWRVXSSRUWWKHJURZWKRIDZLGHUUDQJHRIFHOOW\SHV
9LWDPLQV
6HUXPLVDQLPSRUWDQWVRXUFHRIYLWDPLQVLQFHOOFXOWXUH+RZHYHUPDQ\PHGLDDUHDOVR
HQULFKHG ZLWK YLWDPLQV PDNLQJ WKHP FRQVLVWHQWO\ PRUH VXLWDEOH IRU D ZLGHU UDQJH RI FHOO
OLQHV 9LWDPLQV DUH SUHFXUVRUV IRU QXPHURXV FRIDFWRUV 0DQ\ YLWDPLQV HVSHFLDOO\ % JURXS
YLWDPLQV DUH QHFHVVDU\ IRU FHOO JURZWK DQG SUROLIHUDWLRQ DQG IRU VRPH OLQHV WKHSUHVHQFHRI
%LVHVVHQWLDO6RPHPHGLDDOVRKDYHLQFUHDVHGOHYHOVRIYLWDPLQV$DQG(7KHYLWDPLQV
FRPPRQO\XVHGLQPHGLDLQFOXGHULERIODYLQWKLDPLQHDQGELRWLQ
3URWHLQVDQG3HSWLGHV
7KHVHDUHSDUWLFXODUO\LPSRUWDQWLQVHUXPIUHHPHGLD7KHPRVWFRPPRQSURWHLQVDQG
SHSWLGHV LQFOXGH DOEXPLQ WUDQVIHUULQ ILEURQHFWLQ DQG IHWXLQ DQG DUH XVHG WR UHSODFH WKRVH
QRUPDOO\SUHVHQWWKURXJKWKHDGGLWLRQRIVHUXPWRWKHPHGLXP
)DWW\$FLGVDQG/LSLGV
/LNH SURWHLQV DQG SHSWLGHV WKHVH DUH LPSRUWDQW LQ VHUXP IUHH PHGLD EHFDXVH WKH\ DUH
QRUPDOO\ SUHVHQW LQ VHUXP )RU H[DPSOH FKROHVWHURO DQG VWHURLGV HVVHQWLDO IRU VSHFLDOL]HG
FHOOV
7UDFH(OHPHQWV
7KHVH LQFOXGH WUDFH HOHPHQWV VXFK DV ]LQF FRSSHU VHOHQLXP DQG WULFDUER[\OLF DFLG
LQWHUPHGLDWHV6HOHQLXPLVDGHWR[LILHUDQGKHOSVUHPRYHR[\JHQIUHHUDGLFDOV
:KLOVWDOOPHGLDPD\EH PDGHIURP WKH EDVLF LQJUHGLHQWV WKLVLVWLPHFRQVXPLQJ DQG
PD\SUHGLVSRVHWRFRQWDPLQDWLRQ)RUFRQYHQLHQFHPRVWPHGLDDUHDYDLODEOHDVUHDG\PL[HG
SRZGHUVRUDV[DQG[OLTXLGPHGLD$OOFRPPRQO\XVHGPHGLDDUHOLVWHGLQWKH6LJPD
$OGULFK/LIH6FLHQFH&DWDORJXH,ISRZGHURU[PHGLDDUHSXUFKDVHGLWLVHVVHQWLDOWKDWWKH
ZDWHUXVHGWRUHFRQVWLWXWHWKHSRZGHURUGLOXWHWKHFRQFHQWUDWHGOLTXLGLVIUHHIURPPLQHUDO
RUJDQLF DQG PLFURELDO FRQWDPLQDQWV ,W PXVW DOVR EH S\URJHQ IUHH ZDWHU WLVVXH FXOWXUH
JUDGH ,QPRVWFDVHVZDWHUSUHSDUHGE\UHYHUVHRVPRVLVDQGUHVLQFDUWULGJHSXULILFDWLRQZLWK
DILQDOUHVLVWDQFHRI0[LVVXLWDEOH2QFHWKHPHGLDLVSUHSDUHGLWVKRXOGEHILOWHUHGDQG
VWHULOL]HGEHIRUHXVH2EYLRXVO\SXUFKDVLQJ[OLTXLGPHGLDGLUHFWIURP6LJPDHOLPLQDWHVWKH
QHHGIRUWKLV
6HUXP
6HUXP LV D FRPSOH[ PL[ RI DOEXPLQV JURZWK IDFWRUV DQG JURZWK LQKLELWRUV DQG LV
SUREDEO\RQHRIWKHPRVWLPSRUWDQWFRPSRQHQWVRIFHOOFXOWXUHPHGLXP7KHPRVWFRPPRQO\
XVHGVHUXPLVIHWDOERYLQHVHUXP2WKHUW\SHVRIVHUXPDUHDYDLODEOHLQFOXGLQJQHZERUQFDOI
VHUXP DQG KRUVH VHUXP 7KH TXDOLW\ W\SH DQG FRQFHQWUDWLRQ RI VHUXP FDQ DOO DIIHFW WKH
JURZWK RI FHOOV DQG LW LV WKHUHIRUH LPSRUWDQW WR VFUHHQ EDWFKHV RI VHUXP IRU WKHLU DELOLW\ WR
VXSSRUW WKH JURZWK RI FHOOV ,Q DGGLWLRQ WKHUH DUH RWKHU WHVWV WKDW PD\ EH XVHG WR DLG WKH
VHOHFWLRQ RI D EDWFK RI VHUXP LQFOXGLQJ FORQLQJ HIILFLHQF\ SODWLQJ HIILFLHQF\ DQG WKH
SUHVHUYDWLRQRIFHOOFKDUDFWHULVWLFV

Ϯϴ

 6HUXPLVDOVRDEOHWRLQFUHDVHWKHEXIIHULQJFDSDFLW\RIFXOWXUHVWKDWFDQEHLPSRUWDQW
IRUVORZJURZLQJFHOOVRUZKHUHWKHVHHGLQJGHQVLW\LVORZ HJFHOOFORQLQJH[SHULPHQWV ,W
DOVRKHOSVWRSURWHFWDJDLQVWPHFKDQLFDOGDPDJHZKLFKPD\RFFXULQVWLUUHGFXOWXUHVRUZKLOVW
XVLQJDFHOOVFUDSHU$IXUWKHUDGYDQWDJHRIVHUXPLVWKHZLGHUDQJHFHOOW\SHVZLWKZKLFKLW
FDQEHXVHGGHVSLWHWKHYDU\LQJUHTXLUHPHQWVRIGLIIHUHQWFXOWXUHVLQWHUPVRIJURZWKIDFWRUV
,QDGGLWLRQVHUXPLVDEOHWRELQGDQGQHXWUDOL]HWR[LQV+RZHYHUVHUXPLVVXEMHFWWREDWFK
EDWFK YDULDWLRQ WKDW PDNHV VWDQGDUGL]DWLRQ RI SURGXFWLRQ SURWRFROV GLIILFXOW 7KHUHLV DOVRD
ULVN RI FRQWDPLQDWLRQ DVVRFLDWHG ZLWK WKH XVH RI VHUXP 7KHVH ULVNV FDQ EH PLQLPL]HG E\
REWDLQLQJ VHUXP IURP D UHSXWDEOH VRXUFH EHFDXVH VXSSOLHUV RI ODUJH TXDQWLWLHV RI VHUXP
SHUIRUPDEDWWHU\RITXDOLW\FRQWUROWHVWVDQGVXSSO\DFHUWLILFDWHRIDQDO\VLVZLWKWKHVHUXP
,QSDUWLFXODUVHUXPLVVFUHHQHGIRUWKHSUHVHQFHRIERYLQH YLUDO GLDUUKHDYLUXV %9'9  DQG
P\FRSODVPD +HDW LQDFWLYDWLRQ RI VHUXP LQFXEDWLRQ DW ž& IRU  PLQXWHV  FDQ KHOS WR
UHGXFH WKH ULVN RI FRQWDPLQDWLRQ EHFDXVH VRPH YLUXVHV DUH LQDFWLYDWHG E\ WKLV SURFHVV
+RZHYHU WKH URXWLQH XVH RI KHDW LQDFWLYDWHG VHUXP LV QRW DQ DEVROXWH UHTXLUHPHQW IRU FHOO
FXOWXUH 7KH XVH RI VHUXP DOVR KDV D FRVW LPSOLFDWLRQ QRW RQO\ LQ WHUPV RI PHGLXP
IRUPXODWLRQEXWDOVRLQGRZQVWUHDPSURFHVVLQJ$)%6VXSSOHPHQWFRQWULEXWHVPJ
RISURWHLQSHUPORIFXOWXUHIOXLGZKLFKFRPSOLFDWHVGRZQVWUHDPSURFHVVLQJSURFHGXUHV

*XLGHOLQHVIRUVHUXPXVH
)HWDOERYLQHVHUXP )%6 KDVEHHQXVHGWRSUHSDUHDQXPEHURIELRORJLFDODQGKDVDQ
H[FHOOHQW UHFRUG RI VDIHW\ 7KH UHFRJQLWLRQ RI ERYLQH VSRQJLIRUP HQFHSDORSDWK\ %6(  LQ
 DQG LWV VXEVHTXHQW VSUHDGLQWRFRQWLQHQWDO (XURSH DORQJVLGH WKH DQQRXQFHPHQW RI WKH
SUREDEOH OLQN EHWZHHQ %6( DQG D QHZ YDULDQW RI &UHXW]IHOGW -DFRE GLVHDVH LQ +XPDQV
VWLPXODWHG DQ LQFUHDVHG FRQFHUQ DERXW VDIH VRXUFLQJ RI DOO ERYLQH PDWHULDOV ,Q  WKH
)RRG DQG 'UXJ $GPLQLVWUDWLRQ )'$  UHFRPPHQGHG DJDLQVW WKH XVH RI ERYLQH GHULYHG
PDWHULDOVIURPFDWWOHZKLFKKDYHUHVLGHGLQRURULJLQDWHGIURPFRXQWULHVZKHUH%6(KDVEHHQ
GLDJQRVHG7KHFXUUHQW(XURSHDQ8QLRQJXLGHOLQHVRQYLUDOVDIHW\IRFXVRQVRXUFLQJWHVWLQJ
DQG SD\LQJ SDUWLFXODU DWWHQWLRQ WR WKH SRWHQWLDO ULVN RI FURVV FRQWDPLQDWLRQ GXULQJ
VODXJKWHULQJ RU FROOHFWLRQ RI WKH VWDUWLQJ WLVVXH $V IDU DV %6( LV FRQFHUQHG WKH (8
JXLGHOLQHV RQ PLQLPL]LQJ WKH ULVN RI %6( WUDQVPLVVLRQ YLD PHGLFLQDO SURGXFWV
&303%:3 UHFRPPHQGV WKH PDLQ PHDVXUHV WR EH LPSOHPHQWHG WR HVWDEOLVK WKH
VDIHW\RIERYLQHPDWHULDOYHUVXVWKH%6(ULVN$JDLQVLPLODUO\WKHIRFXVLVRQJHRJUDSKLFDO
RULJLQWKHDJHRIWKHDQLPDOVWKHEUHHGLQJDQGVODXJKWHULQJFRQGLWLRQVWKHWLVVXHWREHXVHG
DQGWKHFRQGLWLRQVRILWVSURFHVVLQJ
7KHXVHRI )%6LQSURGXFWLRQSURFHVVHVRIPHGLFLQDO SURGXFWV LVDFFHSWDEOH SURYLGHG
JRRG GRFXPHQWDWLRQ RQ VRXUFLQJ DJH RI WKH DQLPDOV DQG WHVWLQJ IRU WKH DEVHQFH RI
DGYHQWLWLRXV DJHQWV LV VXEPLWWHG $OO UHVSRQVLEOH VXSSOLHUV RI )%6 IRU ELRSKDUPDFHXWLFDO
DSSOLFDWLRQVZLOOSURYLGHVXFKGRFXPHQWDWLRQ
5HFHQWUHJXODWRU\UHTXLUHPHQWVLQ(XURSHVWUHVVWKHLPSRUWDQFHRIMXVWLI\LQJWKHXVHRI
PDWHULDO RI ERYLQH FDSULQH RU RYLQH RULJLQ LQ WKH SURGXFWLRQ RI SKDUPDFHXWLFDO SURGXFWV
$OWKRXJK )%6 KDV EHHQ XVHG IRU PDQ\ \HDUV LQ WKH SURGXFWLRQ SURFHVV RI PDQ\ PHGLFLQDO
SURGXFWVVXFKDVYLUDOYDFFLQHVDQGUHFRPELQDQW'1$SURGXFWVDWSUHVHQWWKHUHLVDMXVWLILHG
WUHQGWRUHPRYHDOOPDWHULDORIDQLPDORULJLQIURPPDQXIDFWXULQJSURFHVVHV6LJPD$OGULFK
KDVUHFRJQL]HGWKLVJURZLQJWUHQGDQGZRUNVFORVHO\ZLWKFXVWRPHUVWRRSWLPL]HDQLPDOIUHH
PHGLDIRUPXODWLRQVWRPHHWHDFKFXVWRPHU¶VFHOOFXOWXUHUHTXLUHPHQWV

Ϯϵ

6LPLODUO\WKH)'$KDVVLPLODUJXLGHOLQHVZKHQDFFHSWLQJUHJXODWRU\VXEPLVVLRQV7KH)'$
UHJXODWHV DOO PHGLFLQDO SURGXFWV IRU +XPDQ XVH VXFK DV WKHUDSHXWLFV YDFFLQHV DQG
GLDJQRVWLFV

5HIHUHQFHV

&DEUHUD&0 &RER)1LHWR $ &RUWpV -/ 0RQWHV50&DWDOLQD 3 &RQFKD $  
,GHQWLW\ WHVWV GHWHUPLQDWLRQ RI FHOO OLQH FURVVFRQWDPLQDWLRQ &\WRWHFKQRORJ\    ±

&KDWWHUMHH5  &HOOELRORJ\&DVHVRIPLVWDNHQLGHQWLW\ 6FLHQFH 1HZ<RUN1< 
  ±
'UH[OHU +* 'LUNV 0DFOHRG   )DOVH KXPDQ KHPDWRSRLHWLF FHOO OLQHV FURVV
FRQWDPLQDWLRQVDQGPLVLQWHUSUHWDWLRQV/HXNHPLD  ±
'UH[OHU+*0DFOHRG'LUNV  &URVVFRQWDPLQDWLRQ+66XOWDQLVQRWDP\HORPDEXW
D %XUNLWW O\PSKRPD FHOO OLQH )UHH IXOO WH[W  %ORRG    ± 'XQKDP -+ DQG
*XWKPLOOHU 3   'RLQJ JRRG VFLHQFH $XWKHQWLFDWLQJ FHOO OLQH LGHQWLW\ &HOO 1RWHV 
±
/LVFRYLWFK05DYLG  $FDVH VWXG\LQ PLVLGHQWLILFDWLRQ RIFDQFHUFHOOOLQHV0&)
$GU5 FHOOV UHGHVLJQDWHG 1&,$'55(6  DUH GHULYHG IURP 29&$5 KXPDQ RYDULDQ
FDUFLQRPDFHOOV&DQFHUOHWWHUV  ±
0DVWHUV-5  +H/DFHOOV\HDUVRQWKHJRRGWKHEDGDQGWKHXJO\1DWXUHUHYLHZV
&DQFHU  ±
6FKLII  -XGLWK$QQ$QXQVXQJKHURRIPHGLFDOUHVHDUFK<DOH$OXPQL0DJD]LQH

















ϯϬ

 &KDSWHU
%DVLFSULQFLSOHV

,QWURGXFWLRQ

&HOOFXOWXUHKDVEHFRPHDQLQGLVSHQVDEOHWHFKQRORJ\LQPDQ\EUDQFKHVRIOLIHVFLHQFHV
WKDW SURYLGHV WKH EDVLV IRU VWXG\LQJ WKH UHJXODWLRQ RI FHOO SUROLIHUDWLRQ GLIIHUHQWLDWLRQ DQG
SURGXFW IRUPDWLRQ LQ FDUHIXOO\ FRQWUROOHG FRQGLWLRQV ZLWK SURFHVVHV DQG DQDO\WLFDO WRROV
ZKLFKDUHVFDODEOHIURPWKHOHYHORIWKHVLQJOHFHOOWRLQH[FHVVRINJZHWZHLJKWRIFHOOV
&HOO FXOWXUH KDV DOVR SURYLGHG WKH PHDQV WR GHILQH DOPRVW WKHHQWLUHKXPDQ JHQRPHDQG WR
GLVVHFW WKH SDWKZD\V RI LQWUDFHOOXODU DQG LQWHUFHOOXODU VLJQDOOLQJ ZKLFK XOWLPDWHO\ UHJXODWH
JHQH H[SUHVVLRQ )URP LWV DQFHVWU\ LQ GHYHORSPHQWDO ELRORJ\ DQG SDWKRORJ\ WKLV GLVFLSOLQH
KDVQRZHPHUJHGDVDWRROIRUPROHFXODUJHQHWLFLVWVLPPXQRORJLVWVVXUJHRQVELRHQJLQHHUV
DQG PDQXIDFWXUHUV RI SKDUPDFHXWLFDOV ZKLOH VWLOO UHPDLQLQJ D IXQGDPHQWDO WRRO WR WKH FHOO
ELRORJLVWZKRVHLQSXWLVYLWDOIRUWKHFRQWLQXLQJGHYHORSPHQWRIWKHWHFKQRORJ\

&HOO FXOWXUH KDV PDWXUHG IURP D VLPSOH PLFURVFRSH GULYHQ REVHUYDWLRQDO VFLHQFH WR D
XQLYHUVDOO\ DFNQRZOHGJHG WHFKQRORJ\ ZLWK URRWV VHW DV GHHS LQ LQGXVWU\ DV WKH\ DUH LQ
DFDGHPLFV,WVWDQGVDPRQJPLFURHOHFWURQLFVDYLRQLFVDVWURSK\VLFVDQGQXFOHDUHQJLQHHULQJ
DVRQHRIWKHPDMRUEULGJHVEHWZHHQIXQGDPHQWDOUHVHDUFKDQGLQGXVWULDOH[SORLWDWLRQDQGLQ
WKHFXUUHQWFOLPDWHSHUKDSVWKHPRUHFRPPHUFLDODVSHFWVZLOOHQVXUHLWVGHYHORSPHQWIRUDW
OHDVWVHYHUDOPRUHGHFDGHV7KHSURVSHFWVIRUJHQHWLFWKHUDS\DQGWLVVXHUHSODFHPHQWDUHVXFK
WKDW WKH TXHVWLRQV DUH UDSLGO\ EHFRPLQJ HWKLFDODV PXFK DV WHFKQLFDODV QHZ RSSRUWXQLWLHV
DULVHIRUJHQHWLFPDQLSXODWLRQZKROHDQLPDOFORQLQJDQGWLVVXHWUDQVSODQWDWLRQ

%LRORJ\RIFHOOVLQFXOWXUH
2ULJLQDQGFKDUDFWHUL]DWLRQ

7KH OLVW RI GLIIHUHQW FHOO W\SHV ZKLFK FDQ EH JURZQ LQ FXOWXUH LV H[WHQVLYH LQFOXGHV
UHSUHVHQWDWLYHV RI PRVW PDMRU FHOO W\SHV DQG KDV VLJQLILFDQWO\ LQFUHDVHG GXH ODUJHO\ WR WKH
LPSURYHG DYDLODELOLW\ RI VHOHFWLYH PHGLD DQG VSHFLDOL]HG FHOO FXOWXUHV WKURXJK FRPPHUFLDO
VRXUFHVVXFKDV&ORQHWLFV

7KH XVH RI PDUNHUV WKDW DUH FHOO W\SH VSHFLILF KDV PDGH LW SRVVLEOH WR GHWHUPLQH WKH
OLQHDJH IURP ZKLFK PDQ\RI WKHVHFXOWXUHV ZHUH GHULYHG DOWKRXJK WKH SRVLWLRQ RI WKH FHOOV
ZLWKLQWKHOLQHDJHLVQRWDOZD\VFOHDU'XULQJSURSDJDWLRQDSUHFXUVRUFHOOW\SHZLOOWHQGWR
SUHGRPLQDWH UDWKHU WKDQ D GLIIHUHQWLDWHG FHOO &RQVHTXHQWO\ D FHOO OLQH PD\ DSSHDU WR EH
KHWHURJHQHRXV DV VRPH FXOWXUHV VXFK DV HSLGHUPDO NHUDWLQRF\WHV FDQ FRQWDLQ VWHP FHOOV
SUHFXUVRUFHOOVDQGPDWXUHGLIIHUHQWLDWHGFHOOV7KHUHLVFRQVWDQWUHQHZDOIURPWKHVWHPFHOOV
SUROLIHUDWLRQ DQG PDWXUDWLRQ LQ WKH SUHFXUVRU FRPSDUWPHQW DQG WHUPLQDO DQG LUUHYHUVLEOH
GLIIHUHQWLDWLRQLQWKHPDWXUHFRPSDUWPHQW2WKHUFXOWXUHVVXFKDVGHUPDOILEUREODVWVFRQWDLQ
D UHODWLYHO\ XQLIRUP SRSXODWLRQ RI SUROLIHUDWLQJ FHOOV DW ORZ FHOO GHQVLWLHV DERXW 
FHOOVFP DQGDQHTXDOO\XQLIRUPPRUHGLIIHUHQWLDWHG QRQSUROLIHUDWLQJ SRSXODWLRQDW KLJK
FHOOGHQVLWLHV  FHOOVFP 7KLVKLJKGHQVLW\SRSXODWLRQRIILEURF\WHOLNHFHOOVFDQUHHQWHU
WKHFHOO F\FOH LI WKHFHOOV DUH WU\SVLQL]HG RU VFUDSHG E\ PDNLQJ D FXW LQ WKH PRQROD\HU  WR
UHGXFH WKH FHOO GHQVLW\ RU FUHDWH D IUHH HGJH 0RVW RI WKH FHOOV DSSHDU WR EH FDSDEOH RI
SUROLIHUDWLRQ DQG WKHUH LV OLWWOH HYLGHQFH RI UHQHZDO IURP D VWHP FHOO FRPSDUWPHQW &XOWXUH
KHWHURJHQHLW\ DOVR UHVXOWV IURP PXOWLSOH OLQHDJHV EHLQJ SUHVHQW LQ WKH FHOO OLQH 7KH RQO\

ϯϭ

XQLI\LQJ IDFWRUV DUH WKH VHOHFWLYH FRQGLWLRQV RI WKH PHGLXP DQG VXEVWUDWH DQG WKH
SUHGRPLQDQFH RI WKH FHOO W\SH RU W\SHV  ZKLFK KDYH WKH DELOLW\ WR VXUYLYH DQG SUROLIHUDWH
7KLVWHQGVWRVHOHFWDFRPPRQSKHQRW\SHEXWGXHWRWKHLQWHUDFWLYHQDWXUHRIJURZWKFRQWURO
PD\REVFXUHWKHIDFWWKDWWKHSRSXODWLRQFRQWDLQVVHYHUDOGLVWLQFWSKHQRW\SHVRQO\GHWHFWDEOH
E\FORQLQJ

1XWULWLRQDO IDFWRUV OLNH VHUXP &D LRQV KRUPRQHV FHOO DQG PDWUL[ LQWHUDFWLRQV DQG
FXOWXUHGHQVLW\FDQDIIHFWGLIIHUHQWLDWLRQDQGFHOOSUROLIHUDWLRQ+HQFHLWLVQRWRQO\HVVHQWLDO
WR GHILQH WKH OLQHDJH RI FHOOV EHLQJ XVHG EXW DOVR WR FKDUDFWHUL]H DQG VWDELOL]H WKH VWDJH RI
GLIIHUHQWLDWLRQ E\ FRQWUROOLQJ FHOO GHQVLW\ DQG WKH QXWULWLRQDO DQG KRUPRQDO HQYLURQPHQW WR
REWDLQ D XQLIRUP SRSXODWLRQ RI FHOOV ZKLFK ZLOO UHVSRQG LQ D UHSURGXFLEOHIDVKLRQ WR JLYHQ
VLJQDOV

$VWKHG\QDPLFSURSHUWLHVRIFHOOFXOWXUH SUROLIHUDWLRQPLJUDWLRQQXWULHQWXWLOL]DWLRQ
SURGXFWVHFUHWLRQ DUHVRPHWLPHV GLIILFXOWWRFRQWURODQG WKHFRPSOH[LW\RIFHOOLQWHUDFWLRQV
IRXQGLQYLYRFDQEHGLIILFXOWWRUHFUHDWHLQYLWURWKHUHKDYHEHHQQXPHURXVDWWHPSWVWRHLWKHU
UHWDLQ WKH VWUXFWXUDO LQWHJULW\ RI WKH RULJLQDO WLVVXH XVLQJ WUDGLWLRQDO RUJDQ FXOWXUH RU WR
UHFUHDWHLWE\FRPELQLQJSURSDJDWHGFHOOVRIGLIIHUHQWOLQHDJHVLQRUJDQRW\SLFFXOWXUH$PRQJ
WKH PRVW VXFFHVVIXO H[DPSOHV RI WKH ODWWHU DUH WKH VR FDOOHG VNLQ HTXLYDOHQW PRGHOV ZKHUH
HSLGHUPDO NHUDWLQRF\WHV DUH FRFXOWXUHG ZLWK GHUPDO ILEUREODVWV DQG FROODJHQ LQ ILOWHU ZHOO
LQVHUWVRUVRPHVLPLODUPHFKDQLFDOVXSSRUW7KHUHVXOWLVDV\QWKHWLFVNLQVXLWDEOHIRUJUDIWLQJ
DQGQRZEHLQJHYDOXDWHGIRUWHVWVRILUULWDQF\DQGLQIODPPDWLRQ

'LIIHUHQWLDWLRQDQG'HYHORSPHQW

$VSURSDJDWLRQRIFHOOOLQHVUHTXLUHVWKDWWKHFHOOQXPEHULQFUHDVHVFXOWXUHFRQGLWLRQV
KDYH HYROYHGWR IDYRXU PD[LPDO FHOO SUROLIHUDWLRQ ,W LV QRW VXUSULVLQJ WKDW WKHVHFRQGLWLRQV
DUH RIWHQ QRW FRQGXFLYH WR FHOO GLIIHUHQWLDWLRQ ZKHUH FHOO JURZWK LV VHYHUHO\ OLPLWHG RU
FRPSOHWHO\DEROLVKHG7KRVHFRQGLWLRQVZKLFKIDYRXUFHOOSUROLIHUDWLRQDUHORZFHOOGHQVLW\
ORZ&DFRQFHQWUDWLRQ P0 DQGWKHSUHVHQFHRIJURZWKIDFWRUVVXFKDVHSLGHUPDO
JURZWK IDFWRU (*)  ILEUREODVW JURZWK IDFWRU )*)  DQG SODWHOHWGHULYHG JURZWK IDFWRU
3'*)  +LJK FHOO GHQVLW\ !  [  FHOOVFP  KLJK &D FRQFHQWUDWLRQ  P0 
DQG WKH SUHVHQFH RI GLIIHUHQWLDWLRQ LQGXFHUV KRUPRQHV VXFK DV K\GURFRUWLVRQH SDUDFULQH
IDFWRUVVXFKDV,/DQG.*)DQGQHUYHJURZWKIDFWRUUHWLQRLGVDQGSODQDUSRODUFRPSRXQGV
VXFK DV GLPHWK\O VXOIR[LGH ZLOO IDYRXU F\WRVWDVLV DQG GLIIHUHQWLDWLRQ 7KH UROH RI VHUXP LQ
GLIIHUHQWLDWLRQ LV FRPSOH[ DQG GHSHQGV RQ WKH FHOO W\SH DQG PHGLXP XVHG $ ORZ VHUXP
FRQFHQWUDWLRQ SURPRWHV GLIIHUHQWLDWLRQ LQ ROLJRGHQGURF\WHV ZKHUHDV D KLJK VHUXP
FRQFHQWUDWLRQFDXVHVVTXDPRXVGLIIHUHQWLDWLRQLQEURQFKLDOHSLWKHOLXP,QWKHODWWHUFDVHWKLV
LV GXH WR WUDQVIRUPLQJ JURZWK IDFWRU % 7*)%  UHOHDVHG IURP SODWHOHWV %HFDXVH RI WKH
XQGHILQHG FRPSRVLWLRQ RI VHUXP DQG WKH HYHUSUHVHQW ULVN RI DGYHQWLWLRXV DJHQWV VXFK DV
YLUXVHV FRQWUROOHG VWXGLHV RQ VHOHFWLYH JURZWK DQG GLIIHUHQWLDWLRQ DUH EHVW FRQGXFWHG LQ
VHUXPIUHHPHGLD

7KH HVWDEOLVKPHQW RI WKH FRUUHFW SRODULW\ DQG FHOO VKDSH PD\ DOVR EH LPSRUWDQW
SDUWLFXODUO\LQHSLWKHOLXP0DQ\UHSRUWVKDYHVKRZQWKDWJURZLQJFHOOVWRKLJKGHQVLW\RQD
IORDWLQJ FROODJHQ JHO DOORZV PDWUL[ LQWHUDFWLRQ DFFHVV WR PHGLXP RQ ERWK VLGHV DQG
SDUWLFXODUO\WRWKHEDVDOVXUIDFHZKHUHUHFHSWRUVDQGQXWULHQWWUDQVSRUWHUVDUHH[SUHVVHG7KH
SODVWLFLW\ RI WKH VXEVWUDWH FDQ IDFLOLWDWH D QRUPDO FHOO VKDSH DQG QRUPDO SRODULW\ RI WKH
LQWHUDFWLYH OLJDQGV LQ WKH EDVHPHQW PHPEUDQH 'LIIHUHQW FRQGLWLRQV PD\ EH UHTXLUHG IRU
SURSDJDWLRQ DQG GLIIHUHQWLDWLRQ DQG KHQFH DQ H[SHULPHQWDO SURWRFRO PD\ UHTXLUH D JURZWK

ϯϮ

SKDVHIRUH[SDQVLRQDQGWRDOORZIRUUHSOLFDWHVDPSOHVIROORZHGE\DQRQJURZWKPDWXUDWLRQ
SKDVHWRDOORZIRULQFUHDVHGH[SUHVVLRQRIGLIIHUHQWLDWHGIXQFWLRQV

0DPPDOLDQ FHOO OLQHV FRPPDQG DQ HIIHFWLYH PRQRSRO\ IRU WKH SURGXFWLRQ RI
WKHUDSHXWLF SURWHLQV WKDW UHTXLUH SRVWWUDQVODWLRQDO PRGLILFDWLRQV 7KLV XQLTXH DGYDQWDJH
RXWZHLJKVWKHFRVWVDVVRFLDWHGZLWKPDPPDOLDQFHOOFXOWXUHZKLFKDUHIDUJUDWHULQWHUPVRI
GHYHORSPHQWWLPHDQGPDQXIDFWXULQJZKHQFRPSDUHGWRPLFURELDOFXOWXUH7KHGHYHORSPHQW
RI FHOO OLQHV KDV XQGHUJRQH VHYHUDO DGYDQFHV RYHU WKH \HDUV HVVHQWLDOO\ WR PHHW WKH
UHTXLUHPHQW WR FXW WKH WLPH DQG FRVWV DVVRFLDWHG ZLWK XVLQJ VXFK D FRPSOH[ KRVWV DV
SURGXFWLRQSODWIRUPV

'HYHORSPHQW RI FHOO OLQHV DQG WKH FHOO HQJLQHHULQJ DSSURDFK FDQ EH XVHG WR HQKDQFH
SURGXFWLYLW\ LPSURYH FHOO IXQFWLRQ JO\FRV\ODWLRQ DQG VHFUHWLRQ DQG FRQWURO DSRSWRVLV
([SUHVVLRQ HQJLQHHULQJ LQFOXGLQJ HSLJHQHWLFV DQG WKH XVH RI WHFKQRORJLHV WR RYHUFRPH
SRVLWLRQDOGHSHQGHQWLQDFWLYDWLRQWKHXVHRISURPRWHUDQGHQKDQFHUVHTXHQFHVIRUH[SUHVVLRQ
RI YDULRXV WUDQVJHQHV VLWH GLUHFWHG HQJLQHHULQJ RI GHILQHG FKURPRVRPDO VLWHV DQG
H[DPLQDWLRQRIWKHUROHRIHXNDU\RWLFQXFOHXVDVWKHFRQWUROOHURIH[SUHVVLRQRIJHQHVWKDWDUH
LQWURGXFHGIRUSURGXFWLRQRIDGHVLUHGSURGXFW,WLQFOXGHVDUHYLHZRIVHOHFWLRQPHWKRGVIRU
KLJK SURGXFHUV DQG DQ DSSOLFDWLRQ GHYHORSHG E\ D PDMRU ELRSKDUPDFHXWLFDO LQGXVWU\ WR
H[SHGLWH WKH FHOO OLQH GHYHORSPHQW SURFHVV 7KH SRWHQWLDO RI FHOO HQJLQHHULQJ DSSURFK WR
HQKDQFH FHOO OLQHV WKURXJK WKH PDQLSXODWLRQ RI JHQHV WKDW SOD\V LPSRUWDQW UROHV LQ NH\
PHWDEROLFDQGUHJXODWRU\SDWKZD\V

&KRLFHRIPDWHULDOV
&HOOW\SH

7KHFHOOW\SHFKRVHQZLOOGHSHQGRQWKHTXHVWLRQEHLQJDVNHG)RUVRPHSURFHVVHVVXFK
DV'1$V\QWKHVLVUHVSRQVHWRF\WRWR[LQVRUDSRSWRVLVWKHFHOOW\SHPD\QRWPDWWHUSURYLGHG
WKHFHOOVDUHFRPSHWHQW,QRWKHUFDVHVDVSHFLILFSURFHVVZLOOUHTXLUHDSDUWLFXODUFHOOW\SHIRU
H[DPSOHVXUIDFWDQWV\QWKHVLVLQWKHOXQJZLOOUHTXLUHDIUHVKLVRODWHRIW\SH,,SQHXPRF\WHVRU
DFHOOOLQHVXFKDV1&,+ZKLFKVWLOOH[SUHVVHVVXUIDFWDQWSURWHLQV$UHDVRQDEOHILUVWVWHS
ZRXOG EH WR GHWHUPLQH IURP WKH OLWHUDWXUH ZKHWKHU D FHOO OLQH H[LVWV ZLWK WKH UHTXLUHG
SURSHUWLHV

6RXUFHRIWLVVXH
(PEU\RRUDGXOW"

&XOWXUHVGHULYHGIURPHPEU\RQLFWLVVXHVVXUYLYHDQGSUROLIHUDWHEHWWHUWKDQWKRVHIURP
WKH DGXOW LQ JHQHUDO 7KLV SUHVXPDEO\ UHIOHFWV WKH ORZHU OHYHO RI VSHFLDOL]DWLRQ DQG KLJKHU
SUROLIHUDWLYHSRWHQWLDOLQWKHHPEU\R$GXOWWLVVXHVXVXDOO\KDYHDORZHUJURZWKIUDFWLRQDQGD
KLJKHUSURSRUWLRQRIQRQUHSOLFDWLQJVSHFLDOL]HGFHOOVRIWHQZLWKLQDPRUHVWUXFWXUHGDQGOHVV
UHDGLO\GLVDJJUHJDWHGH[WUDFHOOXODUPDWUL[,QLWLDWLRQDQGSURSDJDWLRQDUHPRUHGLIILFXOWDQG
WKH OLIHVSDQ RI WKH FXOWXUH RIWHQ VKRUWHU (PEU\RQLF RU IHWDO WLVVXH KDV PDQ\ SUDFWLFDO
DGYDQWDJHVEXWLWPXVWEHUHPHPEHUHGWKDWLQVRPHLQVWDQFHVWKHFHOOVZLOOEHGLIIHUHQWIURP
DGXOWFHOOVDQGLWFDQQRWEHDVVXPHGWKDWWKH\ZLOOPDWXUHLQWRDGXOWW\SHFHOOVXQOHVVWKLVFDQ
EHFRQILUPHGE\DSSURSULDWHFKDUDFWHUL]DWLRQ

([DPSOHV RI ZLGHO\ XVHG HPEU\RQLF FHOO OLQHV DUH WKH YDULRXV 7 OLQHV SULPLWLYH
PRXVH PHVRGHUPDO FHOOV  DQG :, 05& DQG RWKHU KXPDQ IHWDO OXQJ ILEUREODVWV
0HVRGHUPDOO\GHULYHGFHOOV ILEUREODVWVHQGRWKHOLXPDQGP\REODVWV DUHRQWKHZKROHHDVLHU

ϯϯ

WR FXOWXUH WKDQ HSLWKHOLXP QHXURQV RU HQGRFULQH WLVVXH 7KLV VHOHFWLYLW\ PD\ UHIOHFW WKH
H[WHQVLYH XVH RI ILEUREODVW FXOWXUHV GXULQJ WKH HDUO\ GHYHORSPHQW RI FXOWXUH PHGLD DQG WKH
UHVSRQVH RI PHVRGHUPDOO\ GHULYHG FHOOV WR PLWRJHQLF IDFWRUV SUHVHQW LQ VHUXP 6HOHFWLYH
PHGLDKDYHQRZEHHQGHVLJQHGIRUHSLWKHOLDODQGRWKHUFHOOW\SHVDQGZLWKVRPHRIWKHVHLW
KDVEHHQVKRZQWKDWVHUXPLVLQKLELWRU\WRJURZWKDQGPD\SURPRWHGLIIHUHQWLDWLRQ3ULPDU\
FXOWXUH RI HSLWKHOLDO WLVVXHV VXFK DV VNLQ OXQJ DQG PDPPDU\ JODQG LV URXWLQH LQ VRPH
ODERUDWRULHVDQGSUHSDUHGFXOWXUHVDUHDYDLODEOHFRPPHUFLDOO\

1RUPDORUQHRSODVWLF"

1RUPDOWLVVXHXVXDOO\JLYHV ULVHWRFXOWXUHVZLWKDILQLWHOLIHVSDQZKLOHFXOWXUHVIURP
WXPRXUV FDQ JLYH ULVH WR FRQWLQXRXV FHOO OLQHV +RZHYHU WKHUH DUH VHYHUDO H[DPSOHV RI
FRQWLQXRXV FHOO OLQHV %+. KDPVWHU NLGQH\ ILEUREODVWV 0'&. GRJ NLGQH\ HSLWKHOLXP
7 ILEUREODVWV  ZKLFK KDYH EHHQ GHULYHG IURP QRUPDO WLVVXHV DQG ZKLFK DUH QRQ
WXPRULJHQLF 1RUPDOFHOOV JHQHUDOO\ JURZ DV DQ XQGLIIHUHQWLDWHG VWHP FHOO RU SUHFXUVRU FHOO
DQGWKHRQVHWRIGLIIHUHQWLDWLRQLVDFFRPSDQLHGE\DFHVVDWLRQLQFHOOSUROLIHUDWLRQZKLFKPD\
EHSHUPDQHQW6RPHQRUPDOFHOOVVXFKDVILEURF\WHVRUHQGRWKHOLXPDUHDEOHWRGLIIHUHQWLDWH
DQG VWLOO GHGLIIHUHQWLDWH DQG UHVXPH SUROLIHUDWLRQ DQG LQ WXUQ UHGLIIHUHQWLDWH ZKLOH RWKHUV
VXFKDVVTXDPRXVHSLWKHOLXPVNHOHWDOPXVFOHDQGQHXURQVRQFHFRPPLWWHGWRGLIIHUHQWLDWH
DSSHDUWREHLQFDSDEOHRIUHVXPLQJSUROLIHUDWLRQ&HOOVFXOWXUHGIURPQHRSODVPVVXFKDV%
PRXVHPHODQRPDFDQH[SUHVVDWOHDVWSDUWLDOGLIIHUHQWLDWLRQZKLOHUHWDLQLQJWKHFDSDFLW\WR
GLYLGH 0DQ\ VWXGLHV RI GLIIHUHQWLDWLRQ KDYH WDNHQ DGYDQWDJH RI WKLV IDFW DQG XVHG
GLIIHUHQWLDWHG WXPRXUV VXFK DV KHSDWRPDV DQG KXPDQ DQG URGHQW QHXUREODVWRPDV DOWKRXJK
ZKHWKHUWKLVGLIIHUHQWLDWLRQLVQRUPDODUHQRWNQRZQ

7XPRXU FHOOV FDQ RIWHQ EH SURSDJDWHG LQ WKH V\QJHQHLF KRVW SURYLGLQJ D FKHDS DQG
VLPSOH PHWKRG RI SURGXFLQJ ODUJH QXPEHUV RI FHOOV DOEHLW ZLWK ORZHU SXULW\ :KHUH WKH
QDWXUDOKRVWLVQRWDYDLODEOHWXPRXUVFDQDOVREHSURSDJDWHGLQDQLPDOVZLWKDFRPSURPLVHG
LPPXQH V\VWHP ZLWK JUHDWHU GLIILFXOW\ DQG FRVW EXW VLPLODU DGYDQWDJHV 0DQ\ RWKHU
GLIIHUHQFHV EHWZHHQ QRUPDO DQG QHRSODVWLF FHOOV DUH VLPLODU WR WKRVH EHWZHHQ ILQLWH DQG
FRQWLQXRXV FHOO OLQHV DV LPPRUWDOL]DWLRQ LV DQ LPSRUWDQW FRPSRQHQW RI WKH SURFHVV RI
WUDQVIRUPDWLRQ

6XEFXOWXUH

)UHVKO\LVRODWHGFXOWXUHVDUHNQRZQDVSULPDU\FXOWXUHVXQWLOWKH\DUHVXEFXOWXUHG7KH\
DUHXVXDOO\KHWHURJHQHRXVDQGKDYHDORZJURZWKIUDFWLRQEXWDUHPRUHUHSUHVHQWDWLYHRIWKH
FHOOW\SHVLQWKHWLVVXHIURPZKLFKWKH\ZHUHGHULYHGDQGLQWKHH[SUHVVLRQRIWLVVXHVSHFLILF
SURSHUWLHV6XEFXOWXUHDOORZVWKHH[SDQVLRQRIWKHFXOWXUH LWLVQRZNQRZQDVDFHOOOLQH WKH
SRVVLELOLW\ RI FORQLQJ FKDUDFWHUL]DWLRQ DQG SUHVHUYDWLRQ DQG JUHDWHU XQLIRUPLW\ EXW PD\
FDXVHDORVVRIVSHFLDOL]HGFHOOVDQGGLIIHUHQWLDWHGSURSHUWLHVXQOHVVFDUHLVWDNHQWRVHOHFWWKH
FRUUHFWOLQHDJHDQGSUHVHUYHRUUHLQGXFHGLIIHUHQWLDWHGSURSHUWLHV7KHJUHDWHVWDGYDQWDJHRI
VXEFXOWXULQJDSULPDU\FXOWXUHLQWRDFHOOOLQHLVWKHSURYLVLRQRIODUJHDPRXQWVRIFRQVLVWHQW
PDWHULDOVXLWDEOHIRUSURORQJHGXVH

)LQLWHRUFRQWLQXRXVFHOOOLQHV"

$IWHUVHYHUDOVXEFXOWXUHVDFHOOOLQHZLOOHLWKHUGLHRXW ILQLWHFHOOOLQH RU WUDQVIRUP WR
EHFRPHDFRQWLQXRXVFHOOOLQH,WLVQRWFOHDULQDOOFDVHVZKHWKHUWKHVWHPOLQHRIDFRQWLQXRXV
FXOWXUHSUHH[LVWVRUDULVHVGXULQJVHULDOSURSDJDWLRQ%HFDXVHRIWKHWLPHWDNHQIRUVXFKFHOO

ϯϰ

OLQHV WR DSSHDU RIWHQ VHYHUDO PRQWKV  DQG WKH GLIIHUHQFHV LQ WKHLU SURSHUWLHV LW KDV EHHQ
DVVXPHG WKDW D PXWDWLRQ RFFXUV EXW WKH SUHH[LVWHQFH RI LPPRUWDOL]HG FHOOV SDUWLFXODUO\ LQ
FXOWXUHVIURPQHRSODVPVFDQQRWEHH[FOXGHG

&RPSOHPHQWDWLRQ DQDO\VLV KDV VKRZQ WKDW VHQHVFHQFH LV D GRPLQDQW WUDLW DQG
LPPRUWDOL]DWLRQWKHUHVXOWRIPXWDWLRQVDQGRUGHOHWLRQVLQJHQHVVXFKDVS7KHDFWLYLW\RI
WHORPHUDVHLVKLJKHULQLPPRUWDOFHOOOLQHVDQGPD\EHVXIILFLHQWWRHQGRZWKHFHOOOLQHZLWK
DQ LQILQLWH OLIHVSDQ 7KH DSSHDUDQFH RI D FRQWLQXRXV FHOO OLQH LV XVXDOO\ PDUNHG E\ DQ
DOWHUDWLRQLQF\WRPRUSKRORJ\ JLYLQJFHOOVWKDWDUHVPDOOHUOHVVDGKHUHQWPRUHURXQGHGDQG
ZLWKDKLJKHUUDWLRRIQXFOHXVWRF\WRSODVP DQLQFUHDVHLQJURZWKUDWH SRSXODWLRQGRXEOLQJ
WLPHFDQGHFUHDVHIURPKWRK DUHGXFWLRQLQVHUXPGHSHQGHQFHDQLQFUHDVHLQ
FORQLQJHIILFLHQF\DUHGXFWLRQLQDQFKRUDJHGHSHQGHQFH DVPHDVXUHGE\DQLQFUHDVHGDELOLW\
WRSUROLIHUDWHLQVXVSHQVLRQDVDOLTXLGFXOWXUHRUFORQHGLQDJDU DQLQFUHDVHLQKHWHURSORLG\
FKURPRVRPDO YDULDWLRQ DPRQJ FHOOV  DQG DQHXSORLG\ GLYHUJHQFH IURP WKH GRQRU HXSORLG
NDU\RW\SH DQGDQLQFUHDVHLQWXPRULJHQLFLW\7KHUHVHPEODQFHEHWZHHQVSRQWDQHRXVLQYLWUR
WUDQVIRUPDWLRQ DQG PDOLJQDQW WUDQVIRUPDWLRQ LV REYLRXV EXW QHYHUWKHOHVV WKH WZR DUH QRW
QHFHVVDULO\ LGHQWLFDO DOWKRXJK WKH\ KDYH PXFK LQ FRPPRQ 1RUPDO FHOOV FDQ WUDQVIRUP  WR
EHFRPHFRQWLQXRXVFHOOOLQHVZLWKRXW EHFRPLQJPDOLJQDQWDQGPDOLJQDQWWXPRXUVFDQJLYH
ULVHWRFXOWXUHVZKLFK WUDQVIRUP DQGEHFRPHPRUH RUHYHQOHVV WXPRULJHQLFEXWDFTXLUHWKH
RWKHU SURSHUWLHV OLVWHG DERYH 7UDQVIRUPDWLRQ LQ YLWUR LV SULPDULO\ WKH DFTXLVLWLRQ RI DQ
LQILQLWH OLIHVSDQ 6LPXOWDQHRXV RU VXEVHTXHQW DOWHUDWLRQV LQ JURZWK FRQWURO FDQ EH XQGHU
SRVLWLYHFRQWUROE\RQFRJHQHVRUQHJDWLYHFRQWUROE\WXPRXUVXSSUHVVRUJHQHV

7KH DGYDQWDJHV RI FRQWLQXRXV FHOO OLQHV DUH WKHLU IDVWHU JURZWK UDWHV WR KLJKHU FHOO
GHQVLWLHV DQG UHVXOWDQW JUHDWHU \LHOG WKHLU ORZHU VHUXP UHTXLUHPHQW DQG JHQHUDO HDVH RI
PDLQWHQDQFHLQFRPPHUFLDOO\DYDLODEOHPHGLDDQGWKHLUDELOLW\WRJURZLQVXVSHQVLRQ7KHLU
GLVDGYDQWDJHVLQFOXGHJUHDWHUFKURPRVRPDOLQVWDELOLW\GLYHUJHQFHIURPWKHGRQRUSKHQRW\SH
DQG ORVV RI WLVVXHVSHFLILF PDUNHUV ([DPSOHV RI FRPPRQO\ XVHG FRQWLQXRXV FHOO OLQHV DUH
JLYHQLQ7DEOH

$QXPEHU RI WHFKQLTXHVLQFOXGLQJ WUDQVIHFWLRQ RU LQIHFWLRQ ZLWK YLUDO JHQHV VXFK DV
(DQG(IURPKXPDQSDSLOORPDYLUXVDQG697 RUYLUXVHV VXFKDV(SVWHLQ%DUUYLUXV
(%9  KDYH EHHQ XVHG WR LPPRUWDOL]H D ZLGH UDQJH RI FHOO W\SHV 7KH UHWHQWLRQ RI OLQHDJH
VVSHFLILFSURSHUWLHVLVYDULDEOH
7DEOH&RPPRQO\XVHG&HOO/LQHV

'HVLJQDWLRQ 6SHFLHV 7LVVXH &HOOW\SH 3URSHUWLHV
1RUPDO
05& +XPDQ (PEU\ROXQJ
)LEUREODVWLF 'LSORLGFRQWDFWLQKLELWHG
FRQWDFWLQKLELWHGFDQGLIIHUHQWLDWHLQWR
7/ 0RXVH :KROHHPEU\R )LEUREODVWLF DGLSRVHFHOOV
FRQWDFWLQKLELWHGWUDQVIRUPDEOHZLWK
%+. +DPVWHU .LGQH\ )LEUREODVWLF SRO\RPDYLUXV
0'&. 'RJ .LGQH\ (SLWKHOLDO )RUPV GRPHV 
7UDQVIRUPHGVROLGWLVVXH
(PEU\R
 +XPDQ NLGQH\ (SLWKHOLDO 9HU\VHQVLWLYHWRKXPDQDGHQRYLUXVHV
+HS* +XPDQ +HSDWRPD (SLWKHOLDO 5HWDLQVVRPHGUXJPHWDEROL]LQJHQ]\PHV
+H/D6 +XPDQ &HUYLFDO (SLWKHOLDO 5DSLGJURZWKKLJKSODWLQJHIILFLHQF\

ϯϱ

 FDUFLQRPD
&RV 0RQNH\ .LGQH\ (SLWKHOLDO *RRGKRVWIRUWUDQVIHFWLRQ
&RORUHFWDO )RUPVWLJKWPRQROD\HUZLWKSRODUL]HG
&DFR +XPDQ FDUFLQRPD (SLWKHOLDO WUDQVSRUW
/HXNHPLF
'LIIHUQWLDWHVLQHVSRQVHWRUHWHQRLGV1D%W
+/ +XPDQ 0\HORF\WLF 6XVSHQVLRQ 30$
-XUNDW( +XPDQ 7&HOO 6XVSHQVLRQ 3URGXFHV,/VWLPXODWHGE\SKRUEROHVWHUV
6\QWKHVL]HVKDHPRJORELQZKHQLQGXFHGZLWK
. +XPDQ (U\WKURF\WLF 6XVSHQVLRQ VRGLXPEXW\UDWH


3URSDJDWLRQLQVXVSHQVLRQ

0RVW FXOWXUHV DUH SURSDJDWHG DV D PRQROD\HU DWWDFKHG WR WKH VXEVWUDWH EXW VRPH
LQFOXGLQJWUDQVIRUPHGFHOOVKDHPDWRSRLHWLFFHOOVDQGFHOOVIURPDVFLWHVFDQEHSURSDJDWHGLQ
VXVSHQVLRQ 6XVSHQVLRQ FXOWXUH KDV DGYDQWDJHV LQFOXGLQJ VLPSOHU SURSDJDWLRQ VXEFXOWXUH
RQO\ UHTXLUHV GLOXWLRQ QR WU\SVLQL]DWLRQ  QR UHTXLUHPHQW IRU LQFUHDVLQJ VXUIDFH DUHD ZLWK
LQFUHDVLQJEXONHDVHRIKDUYHVWLQJDQGWKHSRVVLELOLW\RIDFKLHYLQJD VWHDG\VWDWH RUELRVWDW
FXOWXUHLIUHTXLUHG
6HOHFWLRQRIPHGLXP

5HJUHWWDEO\WKHFKRLFHRIPHGLXPLVVWLOORIWHQHPSLULFDO:KDWZDVXVHGSUHYLRXVO\E\
RWKHUVIRUWKHVDPHFHOOVRUZKDWLVFXUUHQWO\EHLQJXVHGLQWKHODERUDWRU\IRUGLIIHUHQWFHOOV
RIWHQ GLFWDWHVWKHFKRLFHRI PHGLXPDQGVHUXP)RU FRQWLQXRXVFHOO OLQHV LW PD\QRWPDWWHU
VLQFHWKHFRQGLWLRQVDUHFRQVLVWHQWEXWIRUVSHFLDOL]HGFHOOW\SHVSULPDU\FXOWXUHVDQGJURZWK
LQWKHDEVHQFHRIVHUXPWKHFKRLFHLVPRUHFULWLFDO

7KHUH DUH WZR PDMRU DGYDQWDJHV RI XVLQJ PRUH VRSKLVWLFDWHG PHGLD LQ WKHDEVHQFH RI
VHUXPWKH\PD\EHVHOHFWLYHIRUSDUWLFXODUW\SHVRIFHOODQGWKHLVRODWLRQRISXULILHGSURGXFWV
LVHDVLHULQWKHDEVHQFHRIVHUXP1HYHUWKHOHVVFXOWXUHLQWKHSUHVHQFHRIVHUXPLVVWLOOHDVLHU
DQGRIWHQQRPRUHH[SHQVLYHWKRXJKOHVVFRQWUROOHG

7ZRPDMRUGHWHUPLQDQWVUHJXODWHWKHXVHRIVHUXPIUHHPHGLD

D  &RVW 0RVW SHRSOH GR QRW KDYH WKH WLPH IDFLOLWLHV RU LQFOLQDWLRQ WR PDNH XS WKHLU RZQ
PHGLD DQG VHUXPIUHH IRUPXODWLRQV ZLWK WKHLU YDULRXV DGGLWLYHV WHQG WR EH PXFK PRUH
H[SHQVLYHWKDQFRQYHQWLRQDOPHGLD
E 5HTXLUHPHQWVIRUVHUXPIUHH PHGLD DUH PRUH FHOOW\SH VSHFLILF6HUXPZLOOFRYHUPDQ\
LQDGHTXDFLHV UHYHDOHG LQ LWV DEVHQFH )XUWKHUPRUH EHFDXVH RI WKHLU VHOHFWLYLW\ D GLIIHUHQW
PHGLXPPD\EHUHTXLUHGIRUHDFKW\SHRIFHOOOLQH7KLVSUREOHPPD\EHSDUWLFXODUO\DFXWH
ZKHQ FXOWXULQJ WXPRXU FHOOV ZKHUH FHOO OLQH YDULDELOLW\ PD\ UHTXLUH PRGLILFDWLRQV IRU FHOO
OLQHVIURPLQGLYLGXDOWXPRXUV

,QWKHILQDODQDO\VLVWKHFKRLFHLVRIWHQVWLOOHPSLULFDOUHDGWKHOLWHUDWXUHDQGGHWHUPLQH
ZKLFK PHGLXP KDV EHHQ XVHG SUHYLRXVO\ ,I VHYHUDO PHGLD KDYH EHHQ XVHG DV LV RIWHQ WKH
FDVHWHVWWKHPDOOZLWKRWKHUVDGGHGLIGHVLUHG 7DEOH 



ϯϲ

 7DEOH&RPPRQO\XVHGPHGLD
0HGLXP 3URSHUWLHV
530, 1R&DORZ0JGHVLJQHGIRUO\PSKREODVWRLGDQGXVHIXOIRURWKHU
0(0+DQNV  &ODVVLFEURDGVSHFLILFLW\PHGLXPORZ+&IRUXVHLQDLU
0(0(DUOHV  &ODVVLFEURDGVSHFLILFLW\PHGLXPKLJK+&2IRUXVHLQ&
/DUJHQXPEHURIDGGLWLRQDOFRQVWLWXHQWV WUDFHHOHPHQWVFRSSHULURQDGGLWLRQDO
) YLWDPLQVQXFOHRVLGHVS\UXYDWHOLSRLFDFLG EXWDWORZFRQFHQWUDWLRQVVXLWDEOHIRU
 FORQLQJ
PL[WXUHRI'0(0DQG)VXLWDEOHIRUSULPDU\FXOWXUHVDQGVHUXPIUHH
'0(0) ZLWKDSSURSULDWHVXSSOHPHQWDWLRQ
/ %LFDUERQDWHIUHHEXIIHUVLQWKHDEVHQFHRI&
0&'% 2QHRIDVHULHVRIVHUXPIUHHPHGLDVXLWDEOHIRUJURZWKRINHUDWLQRF\WHV


0HDVXUHWKHJURZWK SRSXODWLRQGRXEOLQJWLPH 3'7 DQGVDWXUDWLRQGHQVLW\ FORQLQJ
HIILFLHQF\ DQG H[SUHVVLRQ RI VSHFLILF SURSHUWLHV GLIIHUHQWLDWLRQ WUDQVIHFWLRQ HIILFLHQF\FHOO
SURGXFWV HWF  7KH FKRLFH RI PHGLXP PD\ QRW EH WKH VDPH LQ HDFK FDVH IRU H[DPSOH
GLIIHUHQWLDWLRQRIOXQJHSLWKHOLXPZLOOSURFHHGLQVHUXPEXWSURSDJDWLRQLVEHWWHUZLWKRXW,I
SRVVLEOHLQFOXGHRQHRUPRUHVHUXPIUHHPHGLDLQWKHSDQHOWREHWHVWHGVXSSOHPHQWHGZLWK
JURZWKIDFWRUVKRUPRQHVDQGWUDFHHOHPHQWVDVUHTXLUHG2QFHDPHGLXPKDVEHHQVHOHFWHG
WU\WRNHHSWKLVFRQVWDQWIRUDVORQJDVSRVVLEOH6LPLODUO\LIVHUXPLVXVHGVHOHFWDEDWFKE\
WHVWLQJVDPSOHVIURPFRPPHUFLDOVXSSOLHUVDQGUHVHUYHHQRXJKWRODVWVL[PRQWKVWRRQH\HDU
EHIRUHUHSODFLQJLWZLWKDQRWKHUSUHWHVWHGEDWFK7HVWLQJSURFHGXUHVDUHDVGHVFULEHGDERYH
IRUPHGLDVHOHFWLRQ

*DVSKDVH

7KHFRPSRVLWLRQRIWKHJDVSKDVHLVGHWHUPLQHGE\
x 7KHW\SHRIPHGLXP SULQFLSDOO\LWVVRGLXPELFDUERQDWHFRQFHQWUDWLRQ 
x :KHWKHU WKH FXOWXUH YHVVHO LV RSHQ 3HWUL GLVKHV PXOWLZHOO SODWHV  RU VHDOHG IODVNV
ERWWOHV 
x 7KHDPRXQWRIEXIIHULQJUHTXLUHG

6HYHUDO YDULDEOHV DUH LQ SOD\ EXW RQH PDMRU UXOH SUHGRPLQDWHV DQG WKUHH EDVLF
FRQGLWLRQVFDQEHGHVFULEHG7KHUXOHLVWKDWWKHELFDUERQDWHFRQFHQWUDWLRQDQGFDUERQGLR[LGH
WHQVLRQPXVWEHLQHTXLOLEULXP7KHWKUHHFRQGLWLRQVDUHVXPPDUL]HGLQ7DEOH,WVKRXOGEH
UHPHPEHUHG WKDW FDUERQ GLR[LGHELFDUERQDWH LV HVVHQWLDO WR PRVW FHOOV VR D IODVN RU GLVK
FDQQRWEHYHQWHGZLWKRXWSURYLGLQJFDUERQGLR[LGHLQWKHDWPRVSKHUH

3UHSDUHPHGLXPWRDERXWS+DWURRPWHPSHUDWXUHLQFXEDWHDVDPSOHZLWKWKH
FRUUHFW FDUERQ GLR[LGH WHQVLRQ IRU DW OHDVW  K LQ D VKDOORZ GLVK DQG FKHFN WKDW WKH S+
VWDELOL]HVDWS+$GMXVWZLWKVWHULOH0+&RU01D2+LIQHFHVVDU\2[\JHQWHQVLRQ
LV XVXDOO\ PDLQWDLQHG DW DWPRVSKHULF SUHVVXUH EXW YDULDWLRQV KDYH EHHQ GHVFULEHG VXFK DV
HOHYDWHGIRURUJDQFXOWXUHDQGUHGXFHGIRUFORQLQJPHODQRPDDQGVRPHKDHPDWRSRLHWLFFHOOV





ϯϳ

 7DEOH5HODWLRQVKLSEHWZHHQ&DQGELFDUERQDWH
*DV
2SHQRU&ORVHG9HVVHO %XIIHU&DDSDFLW\ +&2 3KDVH +HSHV
&ORVHG9HVVHO /RZ P0 $LU 
2SHQRU&ORVHG9HVVHO 0RGHUDWH P0 & 
2SHQRU&ORVHG9HVVHO +LJK P0 & P0


&XOWXUHV\VWHP

7LVVXHFXOWXUHZDVUHJDUGHGDVWKHFXOWXUHRIZKROHIUDJPHQWVRIH[SODQWHGWLVVXHZLWK
WKH DVVXPSWLRQ WKDW KLVWRORJLFDO LQWHJULW\ ZDV DW OHDVW SDUWLDOO\ PDLQWDLQHG 1RZ WLVVXH
FXOWXUH  KDV EHFRPH D JHQHULF WHUP DQG LQFOXGHV RUJDQ FXOWXUH ZKHUH D VPDOO IUDJPHQW RI
WLVVXH RU ZKROH HPEU\RQLF RUJDQ LV H[SODQWHG WR UHWDLQ WLVVXH DUFKLWHFWXUH DQG FHOO FXOWXUH
ZKHUH WKH WLVVXH LV GLVSHUVHG PHFKDQLFDOO\ RU HQ]\PDWLFDOO\ RU WKH FHOOV PLJUDWH IURP DQ
H[SODQWDQGWKHFHOOVDUHSURSDJDWHGDVDVXVSHQVLRQRUDWWDFKHGPRQROD\HU&HOOFXOWXUHVDUH
XVXDOO\GHYRLGRIVWUXFWXUDORUJDQL]DWLRQKDYHORVWWKHLUKLVWRW\SLFDUFKLWHFWXUHDQGRIWHQWKH
ELRFKHPLFDOSURSHUWLHVDVVRFLDWHGZLWKLWDQGJHQHUDOO\GRQRWDFKLHYHDVWHDG\VWDWHXQOHVV
VSHFLDO FRQGLWLRQV DUH XVHG 7KH\ FDQ KRZHYHU EH SURSDJDWHG H[SDQGHG DQG GLYLGHG LQWR
LGHQWLFDO UHSOLFDWHV 7KH\ FDQ EH FKDUDFWHUL]HG DQG D GHQQHG FHOO SRSXODWLRQ SUHVHUYHG E\
IUHH]LQJDQGWKH\FDQEHSXULILHG E\ JURZWK LQ VHOHFWLYH PHGLDSK\VLFDOFHOOVHSDUDWLRQRU
FORQLQJWRJLYHDFKDUDFWHUL]HGFHOOVWUDLQZLWKFRQVLGHUDEOHXQLIRUPLW\

2UJDQ FXOWXUH ZLOO SUHVHUYH FHOO LQWHUDFWLRQ DQG UHWDLQ KLVWRORJLFDO DQG ELRFKHPLFDO
GLIIHUHQWLDWLRQIRUORQJHUWKDQFHOOFXOWXUH$IWHUWKHLQLWLDOWUDXPDRIH[SODQWDWLRQDQGVRPH
FHQWUDOQHFURVLV RUJDQFXOWXUHVFDQ UHPDLQLQDVWHDG\ VWDWHIRU D SHULRG RI VHYHUDO GD\V WR
\HDUV +RZHYHU WKH\ FDQQRW EH SURSDJDWHG HDVLO\ VKRZ JUHDWHU H[SHULPHQWDO YDULDWLRQ
EHWZHHQ UHSOLFDWHV DQG WHQG WR EH PRUH GLIILFXOW WR XVH IRU TXDQWLWDWLYH GHWHUPLQDWLRQV
3XULILHG FHOO OLQHV FDQ EH PDLQWDLQHG DW KLJK FHOO GHQVLW\ WR FUHDWH KLVWRW\SLF FXOWXUHV DQG
GLIIHUHQW FHOO SRSXODWLRQV FDQ EH FRPELQHG LQ RUJDQRW\SLF FXOWXUH VLPXODWLQJ VRPH RI WKH
SURSHUWLHVRIRUJDQFXOWXUH

6XEVWUDWH

7KH QDWXUH RI WKH VXEVWUDWH LV GHWHUPLQHG ODUJHO\ E\ WKH W\SH RI FHOO DQG WKH XVH WR
ZKLFKLWZLOOEHSXW3RO\VW\UHQHZKLFKKDVEHHQWUHDWHGWRPDNHLWZHWWDEOHDQGJLYHLWDQHW
QHJDWLYHFKDUJHLVQRZXVHGDOPRVWXQLYHUVDOO\,QVSHFLDOFDVHV FXOWXUHRIQHXURQVPXVFOH
FHOOVFDSLOODU\ HQGRWKHOLDOFHOOVDQGVRPHHSLWKHOLDOFXOWXUHV WKH SODVWLFLVSUHFRDWHG ZLWK
ILEURQHFWLQFROODJHQJHODWLQRUSRO\/O\VLQH ZKLFKJLYHVDQHWSRVLWLYHFKDUJH *ODVVPD\
DOVREHXVHGEXWPXVWEHZDVKHGFDUHIXOO\ZLWKDQRQWR[LFGHWHUJHQW

6FDOH

&XOWXUH YHVVHOV YDU\ LQ VL]H IURP PLFURWLWUDWLRQ  PP   —O  XS WKURXJK D
UDQJH RI GLVKHV DQG IODVNV WR  FP DQG UROOHU ERWWOHV DQG PXOWLVXUIDFH SURSDJDWRUV IRU
ODUJH VFDOH FXOWXUH 7KH PDMRU GHWHUPLQDQWV DUH WKH QXPEHU RI FHOOV UHTXLUHG  ;   WR
FPPD[LPXPIRUPRVWXQWUDQVIRUPHGFHOOVWRFPIRUWUDQVIRUPHG WKHQXPEHU
RIUHSOLFDWHV RULQDPLFURWLWUDWLRQSODWH DQGWKHWLPHVRIVDPSOLQJDZHOOSODWHLV
JRRGIRUDODUJHQXPEHURIUHSOLFDWHVIRUVLPXOWDQHRXVVDPSOLQJEXWLQGLYLGXDOGLVKHVWXEHV
RU ERWWOHV DUH SUHIHUDEOH ZKHUH VDPSOLQJ LV FDUULHG RXW DW GLIIHUHQW WLPHV 3HWUL GLVKHV DUH

ϯϴ

FKHDSHUWKDQIODVNVDQGJRRGIRUVXEVHTXHQWSURFHVVLQJHJVWDLQLQJRUH[WUDFWLRQV)ODVNV
FDQ EH VHDOHG GR QRW QHHG D KXPLG FDUERQ GLR[LGH LQFXEDWRU DQG JLYH EHWWHU SURWHFWLRQ
DJDLQVW FRQWDPLQDWLRQ 9ROXPH LV WKH PDLQ GHWHUPLQDQW IRU VXVSHQVLRQ FXOWXUHV 6SDUJLQJ
EXEEOLQJDLUWKURXJKWKHFXOWXUH DQGDJLWDWLRQZLOOEHFRPHQHFHVVDU\DVWKHGHSWK,QFUHDVHV

:KHUHDSURGXFWLVUHTXLUHGUDWKHUWKDQFHOOVWKHUHDUHDGYDQWDJHVLQSHUIXVLRQV\VWHPV
ZKLFK FDQ EH XVHG WR FXOWXUH FHOOV RQ PHPEUDQHV RU KROORZ ILEUHV 7KHVH VXSSO\ QXWULHQWV
DFURVV WKH PHPEUDQH DQG WKH SURGXFW LV FROOHFWHG HLWKHU IURP WKH FHOO VXSHUQDWDQW RU WKH
PHGLXP GHSHQGLQJ RQ WKH PROHFXODU ZHLJKW ZKLFK ZLOO GHWHUPLQH WKH SDUWLWLRQLQJ RI WKH
SURGXFWRQHLWKHUVLGHRIWKHPHPEUDQH3HUIXVLRQLVDOVRXVHIXOIRUWLPHODSVHVWXGLHVZKHUH
FHOOV DUH PRQLWRUHG RQ D PLFURVFRSH VWDJH E\ D YLGHR FDPHUD DQG IRU SKDUPDFRNLQHWLF
PRGHOOLQJ ZKHUH WKH GXUDWLRQ DQG FRQFHQWUDWLRQ RI D WHVW FRPSRXQG FDQ EH UHJXODWHG
SUHFLVHO\

3URFHGXUHV
6XEVWUDWH

0RVWODERUDWRULHVQRZXWLOL]HGLVSRVDEOHSODVWLFVDVVXEVWUDWHVIRUWLVVXHFXOWXUH7KH\
DUHRSWLFDOO\FOHDU SUHSDUHG IRU WLVVXHFXOWXUH XVH E\ PRGLILFDWLRQ RI WKH SODVWLF WR PDNH LW
ZHWWDEOHDQGVXLWDEOHIRUFHOODWWDFKPHQWDQGFRPHVWHULOL]HGIRUXVH2QWKHZKROHWKH\DUH
FRQYHQLHQW DQG SURYLGH D UHSURGXFLEOH VRXUFH RI YHVVHOV IRU ERWK URXWLQH DQG H[SHULPHQWDO
ZRUN

6RPH PRUH IDVWLGLRXV FHOO W\SHV VXFK DV EURQFKLDOHSLWKHOLXP YDVFXODU HQGRWKHOLXP
VNHOHWDO PXVFOH DQG QHXURQV UHTXLUH WKH VXEVWUDWH WR EH FRDWHG ZLWK H[WUDFHOOXODU PDWUL[
PDWHULDOV VXFK DV ILEURQHFWLQ FROODJHQ RU ODPLQLQ 0RVW PDWUL[ SURGXFWV DUH DYDLODEOH
LQGLYLGXDOO\ %HFWRQ 'LFNLQVRQ /LIH 7HFKQRORJLHV 6LJPD %LRIOXLGV  RU FRPELQHG LQ
0DWULJHO %HFWRQ'LFNLQVRQ H[WUDFHOOXODUPDWUL[SURGXFHGE\WKH(QJHOEHUWK+ROP6ZDUP
VDUFRPD FHOO OLQH $OWHUQDWLYHO\ WKH VXEVWUDWH PD\ EH FRDWHG ZLWK H[WUDFHOOXODU PDWUL[ E\
JURZLQJFHOOVRQWKHSODVWLFDQGWKHQZDVKLQJWKHPRIIZLWK7ULWRQ;LQXOWUDSXUHZDWHU
0DWUL[FRDWLQJFDQEHFDUULHGRXWLQWKUHHZD\V

D %\ZHWWLQJWKHVXUIDFHRIWKHSODVWLFZLWKWKHPDWUL[FRPSRQHQW V LQFXEDWLQJIRUD
VKRUWSHULRG XVXDOO\aPLQ WKHQUHPRYLQJWKHVXUSOXVDQGXVLQJWKHSODVWLFZLWK
DGVRUEHGPDWUL[ZLWKLQVHYHQWRWHQGD\V VWRUHGDWƒ&LIQRWXVHGLPPHGLDWHO\ 
E %\ ZHWWLQJ WKH SODVWLF DQG UHPRYLQJ WKH VXUSOXV PDWUL[ PDWHULDO DQG DOORZLQJ WKH
UHVLGXHWRGU\
F %\ DGGLQJ FROODJHQ RU 0DWULJHO DQG DOORZLQJ LW WR JHO :HW RU GU\ FRDWLQJ LV XVHG
PDLQO\IRUSURSDJDWLRQZKLOHJHOFRDWLQJLV XVHG WR SURPRWH GLIIHUHQWLDWLRQRI FHOOV
JURZLQJRQRULQWKHJHO

0HGLXP
0RVWRIWKHFRPPRQO\XVHGPHGLD 7DEOH DUHDYDLODEOHFRPPHUFLDOO\SUHVWHULOL]HG
)RUVSHFLDOIRUPXODWLRQVRUDGGLWLRQVLWPD\EHQHFHVVDU\WRSUHSDUHDQGVWHULOL]HVRPHRIWKH
FRQVWLWXHQWV,QJHQHUDOVWDEOHVROXWLRQV ZDWHUVDOWVDQGPHGLDVXSSOHPHQWVVXFKDVWU\SWRVH
RUSHSWRQH PD\EHDXWRFODYHGDWƒ& N3DRUDWPRVSKHUHDERYHDPELHQW IRUPLQ
ZKLOHODELOHVROXWLRQV PHGLDWU\SVLQDQGVHUXP PXVWEHILOWHUHGWKURXJKD—PSRURVLW\
PHPEUDQHILOWHU 0LOOLSRUH6DUWRULXV3DOO*HOPDQ 6WHULOLW\WHVWLQJVKRXOGEHSHUIRUPHGRQ
VDPSOHVRIHDFKILOWUDWH:KHUHDQDXWRPDWLFDXWRFODYHLVXVHGFDUHPXVWEHWDNHQWRHQVXUH
WKDWWKHWLPLQJRIWKHUXQLVGHWHUPLQHGE\WKHWHPSHUDWXUHRIWKHFHQWUHRIWKHORDGDQGQRW

ϯϵ

MXVWE\GUDLQRUFKDPEHUWHPSHUDWXUHRUSUHVVXUHZKLFKZLOOULVHPXFKIDVWHUWKDQWKHORDG
7KH UHFRUGHUSUREHVKRXOG EH SODFHG LQD SDFNDJH RU ERWWOH RIIOXLGVLPLODUWRWKHORDGDQG
FHQWUDOO\ORFDWHG

&HOOFXOWXUH
3ULPDU\FXOWXUHV

7KHILUVWVWHSLQSUHSDULQJDSULPDU\FXOWXUHLVVWHULOHGLVVHFWLRQIROORZHGE\PHFKDQLFDO
RU HQ]\PDWLF GLVDJJUHJDWLRQ 7KH WLVVXH PD\ VLPSO\ EH FKRSSHG WR DURXQG  PP  DQG WKH
SLHFHV DWWDFKHG WR D GLVK E\ WKHLU RZQ DGKHVLYHQHVV E\ VFUDWFKLQJ WKH GLVK RU E\ XVLQJ
FORWWHGSODVPD,QWKHVHFDVHVFHOOVZLOOJURZRXWIURPWKHIUDJPHQWDQGPD\EHXVHGGLUHFWO\
RUVXEFXOWXUHG7KHIUDJPHQWRIWLVVXHRUH[SODQWDVLWLVFDOOHGPD\EHWUDQVIHUUHGWRDIUHVK
GLVKRUWKHRXWJURZWKWU\SVLQL]HGWROHDYHWKHH[SODQWDQGDQHZRXWJURZWKJHQHUDWHG

:KHQWKHFHOOVIURPWKHRXWJURZWKDUHWU\SVLQL]HGDQGUHVHHGHGLQWRDIUHVKYHVVHOWKH\
EHFRPHDVHFRQGDU\FXOWXUHDQGWKHFXOWXUHLVQRZWHFKQLFDOO\DFHOOOLQH3ULPDU\FXOWXUHV
FDQDOVREHJHQHUDWHGE\GLVDJJUHJDWLQJWLVVXHLQHQ]\PHV VXFKDV WU\SVLQ FUXGH RU
SXUH RUFROODJHQDVH 8POFUXGH DQGWKHFHOOVXVSHQVLRQDOORZHGWR
VHWWOHRQWRDGKHUHDQGVSUHDGRXWRQWKHVXEVWUDWH7KLVW\SHRIFXOWXUHJLYHVDKLJKHU\LHOG
RI FHOOV WKRXJK LW FDQ EH PRUH VHOHFWLYH DV RQO\ FHUWDLQ FHOOV ZLOO VXUYLYH GLVVRFLDWLRQ ,Q
SUDFWLFHPDQ\VXFFHVVIXOSULPDU\FXOWXUHVDUHJHQHUDWHGXVLQJHQ]\PHVVXFKDVFROODJHQDVH
WRUHGXFHWKHWLVVXHSDUWLFXODUO\HSLWKHOLXPWRVPDOOFOXVWHUVRIFHOOVZKLFKDUHWKHQDOORZHG
WRDWWDFKDQGJURZRXW:KHQSULPDU\FXOWXUHVDUHLQLWLDWHGDOOGHWDLOVRISURFHGXUHVVKRXOG
EHFDUHIXOO\GRFXPHQWHGWRIRUPSDUWRIWKHSURYHQDQFHRIDQ\FHOOOLQHWKDWPD\DULVHDQGEH
IRXQGWREHLPSRUWDQW$VDPSOHRIWLVVXHRU'1$H[WUDFWHGIURPLWVKRXOGEHDUFKLYHGWREH
DYDLODEOHIRU'1$ILQJHUSULQWLQJRUSURILOLQJIRUDXWKHQWLFDWLRQRIDQ\FHOOOLQHVWKDWDULVH

6XEFXOWXUH

$PRQROD\HUFXOWXUHPD\EHWUDQVIHUUHGWRDVHFRQGYHVVHODQGGLOXWHGE\GLVVRFLDWLQJ
WKHFHOOVRIWKHPRQROD\HULQWU\SVLQ VXVSHQVLRQFXOWXUHVQHHGRQO\EHGLOXWHG 7KLVLVEHVW
GRQHE\ULQVLQJWKHPRQROD\HUZLWK3%6ODFNLQJ&DDQG0J 3%6$ RU3%6$FRQWDLQLQJ
P0('7$DQGUHPRYLQJWKHULQVHDGGLQJFROGWU\SVLQ FUXGHRUSXUH 
IRUVHFUHPRYLQJWKHWU\SVLQDQGLQFXEDWLQJLQWKHUHVLGXHIRUPLQGHSHQGLQJRQWKH
FHOOOLQH&HOOVDUHWKHQUHVXVSHQGHGLQPHGLXPFRXQWHGDQGUHVHHGHG

*URZWKFXUYH

:KHQ FHOOV DUH VHHGHG LQWR D IODVN WKH\ HQWHU D ODJ SHULRG RI  K IROORZHG E\ D
SHULRGRIH[SRQHQWLDOJURZWK WKH ORJSKDVH DQGILQDOO\HQWHUDSHULRGRIUHGXFHGRU]HUR
JURZWK DIWHU WKH\ EHFRPH FRQIOXHQW SODWHDX SKDVH  )LJXUH   7KHVH SKDVHV DUH
FKDUDFWHULVWLFIRUHDFKFHOOOLQHDQGJLYHULVHWRPHDVXUHPHQWVZKLFKVKRXOGEHUHSURGXFLEOH
ZLWKHDFKVHULDOSDVVDJHWKHOHQJWKRIWKHODJSHULRGWKHSRSXODWLRQGRXEOLQJWLPH 3'7 LQ
PLGORJSKDVHDQGWKHVDWXUDWLRQGHQVLW\DWSODWHDXJLYHQWKDWWKHHQYLURQPHQWDOFRQGLWLRQV
DUH NHSW FRQVWDQW 7KH\ VKRXOG EH GHWHUPLQHG ZKHQ ILUVW KDQGOLQJ D QHZ FHOO OLQH DQG DW
LQWHUYDOVRIHYHU\IHZPRQWKVWKHUHDIWHU,WLVDQLPSRUWDQWHOHPHQWRITXDOLW\FRQWUROWREH
DEOHWRGHPRQVWUDWHWKDWWKHVDPHVHHGLQJFRQFHQWUDWLRQZLOO\LHOGDUHSURGXFLEOHQXPEHURI
FHOOVDWVXEFXOWXUHFDUULHGRXWDIWHUDFRQVLVWHQWWLPHLQWHUYDOZLWKRXWQHFHVVDULO\SHUIRUPLQJ
DJURZWKFXUYHHDFKWLPH 7KH GHWHUPLQDWLRQ RIWKH JURZWK F\FOHLV LPSRUWDQWLQGHVLJQLQJ
URXWLQH VXEFXOWXUH DQG H[SHULPHQWDO SURWRFROV &HOO EHKDYLRXU DQG ELRFKHPLVWU\ FKDQJHV

ϰϬ

VLJQLILFDQWO\DWHDFKSKDVHDQGLWLVWKHUHIRUHHVVHQWLDOWRFRQWUROWKHVWDJHRIWKHJURZWKF\FOH
ZKHQGUXJVRUUHDJHQWVDUHDGGHGRUFHOOVKDUYHVWHG7KHVKDSHRIWKHJURZWKFXUYHFDQDOVR
JLYHLQIRUPDWLRQRQWKHUHSURGXFWLYHSRWHQWLDORIWKHFXOWXUHZKHUHGLIIHUHQFHVLQJURZWKUDWH
3'7  )LJXUHOD DGDSWDWLRQRUVXUYLYDO )LJXUHE DQGGHQVLW\OLPLWDWLRQRIJURZWK OHYHO
RI VDWXUDWLRQ GHQVLW\ LQ SODWHDX  )LJXUH F  FDQ EH GHGXFHG IURP WKH VKDSH RI WKH FXUYH
+RZHYHULWLVJHQHUDOO\UHFRJQL]HGWKDWWKHDQDO\VLVRIFORQDOJURZWKLVHDVLHUDQGOHVVSURQH
WRDPELJXLW\DQGPLVLQWHUSUHWDWLRQ )LJXUHG 

)HHGLQJ

6RPHUDSLGO\JURZLQJFXOWXUHVVXFKDVWUDQVIRUPHGFHOOOLQHVOLNH+H/DZLOOUHTXLUHD
PHGLXP FKDQJH DIWHU WKUHH WR IRXU GD\V LQ D VHYHQ GD\ VXEFXOWXUH F\FOH 7KLV LV XVXDOO\
LQGLFDWHG E\ DQ LQFUHDVH LQ DFLGLW\ ZKHUH WKH S+ IDOOV EHORZ S+  0HGLXP FDQ DOVR
GHWHULRUDWH ZLWKRXW D PDMRU S+ FKDQJH DV VRPH FRQVWLWXHQWV OLNH JOXWDPLQH DUH XQVWDEOH
DQGRWKHUVPD\ EH XWLOL]HG ZLWKRXW D PDMRU S+ VKLIW ,WLVWKHUHIRUH UHFRPPHQGHGWKDWWKH
PHGLXPLVFKDQJHGDWOHDVWRQFHSHUZHHN

&RQWDPLQDWLRQ

7KHSUREOHPRIPLFURELDOFRQWDPLQDWLRQKDVEHHQJUHDWO\UHGXFHGE\WKHXVHRIODPLQDU
DLUIORZFDELQHWV7KHULVNRIFRQWDPLQDWLRQFDQDOVREHUHGXFHGE\XVHRIDQWLELRWLFVEXWWKLV
VKRXOGEHUHVHUYHGIRUKLJKULVNSURFHGXUHVVXFKDVSULPDU\FXOWXUHDQGFXOWXUHVVKRXOGEH
PDLQWDLQHG LQ WKH DEVHQFH RI DQWLELRWLFV VR WKDW FKURQLF FU\SWLF FRQWDPLQDWLRQV DUH QRW
KDUERXUHG

&KHFNIUHTXHQWO\IRUFRQWDPLQDWLRQE\ORRNLQJIRUDUDSLGFKDQJHLQS+ XVXDOO\DIDOO
EXW VRPH IXQJL FDQ LQFUHDVH WKH S+  FORXGLQHVV LQ WKH PHGLXP H[WUDFHOOXODU JUDQXODULW\
XQGHUWKHPLFURVFRSHRUDQ\XQLGHQWLILHGPDWHULDOIORDWLQJLQWKHPHGLXP,IDFRQWDPLQDWLRQ
LV GHWHFWHG GLVFDUG WKH IODVN XQRSHQHG DQG DXWRFODYH ,I LQ GRXEW UHPRYH D VDPSOH DQG
H[DPLQHE\SKDVHPLFURVFRS\*UDP VVWDLQRUVWDQGDUGPLFURELRORJLFDOWHFKQLTXHV

0\FRSODVPD

&XOWXUHVFDQEHFRPHFRQWDPLQDWHGE\0\FRSODVPDIURPPHGLDVHUDWU\SVLQLPSRUWHG
FHOOOLQHVRUWKH RSHUDWRU 0\FRSODVPD LV QRW YLVLEOHWRWKHQDNHGH\HDQGZKLOHWKH\FDQ
DIIHFWFHOOJURZWKWKHLUSUHVHQFHLVRIWHQQRWREYLRXV,WLVLPSRUWDQWWRWHVWIRU0\FRSODVPD
DW UHJXODU LQWHUYDOV HYHU\ RQH WR WKUHH PRQWKV  DV WKH\ FDQ VHULRXVO\ DIIHFW DOPRVW HYHU\
DVSHFW RI FHOO PHWDEROLVP DQWLJHQLFLW\ DQG JURZWK FKDUDFWHULVWLFV 6HYHUDO WHVWV KDYH EHHQ
SURSRVHGEXWWKHIOXRUHVFHQW'1$VWDLQLQJWHFKQLTXHLVWKHPRVWZLGHO\XVHGDOWKRXJKLWLV
OHVVVHQVLWLYHWKDQWKH3&5EDVHGDQGFXOWXUHPHWKRGV

&URVVFRQWDPLQDWLRQ

,WVVHYHULW\LVRIWHQXQGHUUDWHGDQGFRQVHTXHQWO\LWVWLOORFFXUVZLWKDKLJKHUIUHTXHQF\
WKDQPDQ\SHRSOHDGPLW$VLJQLILFDQWQXPEHURIFHOOOLQHVLQFOXGLQJ+HS.%DQG&KDQJ
OLYHU DUH VWLOO LQ UHJXODU XVH ZLWKRXW DFNQRZOHGJHPHQW RI WKHLU FRQWDPLQDWLRQ ZLWK +H/D
0DQ\RWKHUFHOOOLQHVDUHFURVVFRQWDPLQDWHGZLWKFHOOVRWKHUWKDQ+H/D0DQ\PRUHFURVV
FRQWDPLQDWLRQVDUH\HWWREHGHWHFWHG



ϰϭ

 7RDYRLGFURVVFRQWDPLQDWLRQ
‡GRQRWVKDUHERWWOHVRIPHGLDRUUHDJHQWVDPRQJFHOOOLQHV
‡GRQRWUHWXUQDSLSHWWHZKLFKKDVEHHQLQRUQHDUDIODVNRUERWWOHFRQWDLQLQJFHOOVEDFNWR
WKHPHGLXPERWWOHXVHDIUHVKSLSHWWH
‡GRQRWVKDUHPHGLXPDPRQJRSHUDWLYHV
‡KDQGOHRQHFHOOOLQHDWDWLPH


ϰϮ

 
)LJXUH  $QDO\VLV RI JURZWK FXUYHV ([DPSOHV RI JURZWK FXUYHV RI FHOOV IROORZLQJ
VXEFXOWXUH DUH VKRZQ ZLWK FHOO FRQFHQWUDWLRQ FHOOVPO  RQ WKH OHIW D[LV DQG FHOO GHQVLW\
FHOOVFP  RQ WKH ULJKW D[LV %RWK FHOO FRQFHQWUDWLRQ DQG FHOO GHQVLW\ DUH LPSRUWDQW IRU
DWWDFKHG FHOOV DQG XQVWLUUHG VXVSHQVLRQV EXW RQO\ FRQFHQWUDWLRQ LV UHOHYDQW WR VWLUUHG
VXVSHQVLRQV D  7\SLFDO JURZWK FXUYH IRU D FXOWXUH VHHGHG DW  [  FHOOVPO  [ 
FHOOVFP  RQ GD\  VKRZLQJ D ODJ SHULRG RI  K IROORZHG E\ H[SRQHQWLDO JURZWK ORJ 
SKDVH IURPGD\WRGD\DQGHQWHULQJDSODWHDXSKDVHRQRUVKRUWO\DIWHUGD\7KHVROLG
OLQHUHSUHVHQWVDVWDEOHSODWHDXVHHQLQPRVWQRUPDOFHOOV7KHGRWWHGOLQHUHSUHVHQWVWKHUDSLG

ϰϯ

GHWHULRUDWLRQVHHQZLWKPDQ\WUDQVIRUPHGFHOOOLQHVSDUWLFXODUO\VXVSHQVLRQFXOWXUHV VXFKDV
P\HORPD FXOWXUHV  ZKHUH WKH FHOOV GLH VRRQ DIWHU WKH\ KDYH UHDFKHG WKH SODWHDX SKDVH E 
&HOOVSODWHGDVLQ D EXWLQWKHULJKWKDQGFXUYHWKHUHLVHYLGHQFHRIUHGXFHGJURZWKDVWKH
FXUYHGLVSODFHGWRWKHULJKW7KHGLSDWWKHEHJLQQLQJ VROLGOLQHXSZDUGSRLQWLQJWULDQJOHV 
LPSOLHV WKDWPDQ\FHOOVKDYH QRW VXUYLYHG EXW WKDW D UHVLVWDQW IUDFWLRQKDVVXUYLYHGDQGKDV
JURZQWKURXJKZLWKWKHVDPHJURZWKUDWHDVWKHFRQWURO7KHGRWWHGOLQH GRZQZDUGSRLQWLQJ
WULDQJOHV ZRXOGLQGLFDWHWKDWWKHUHZDVQRFHOOORVVEXWWKDWWKHUHZDVDSURORQJHGSHULRGRI
DGDSWDWLRQIROORZHGE\UHFRYHU\DWWKHVDPHJURZWKUDWH F &HOOVSODWHGDVLQ D VKRZLQJD
UHGXFHG JURZWK UDWH UHVXOWLQJ IURP D ORQJHU SRSXODWLRQ GRXEOLQJ WLPH 3'7  ZLWK FHOOV
UHDFKLQJ VDPH VDWXUDWLRQ GHQVLW\ DV FRQWURO VTXDUHV  RU SODWHDXLQJ DW D ORZHU VDWXUDWLRQ
GHQVLW\ GLDPRQGV &HOOVFRXOGDOVRSODWHDXDWDORZHUVDWXUDWLRQGHQVLW\ZKLOHUHWDLQLQJWKH
VDPH3'7 QRWVKRZQ  G &HOOVSODWHGDVLQ D VKRZLQJSRWHQWLDOPLVLQWHUSUHWDWLRQVRIGDWD
LQGLFDWLQJ UHGXFHG JURZWK UDWHV 7KH FXUYH ZLWK XSZDUG IDFLQJ WULDQJOHV VKRZV D UHGXFHG
VXUYLYDOEXWWKHVDPHJURZWKUDWH7KHFXUYHGHQRWHGE\VTXDUHVVKRZVDUHGXFHG3'7%RWK
FXUYHVFRQYHUJHDWGD\VLQWKLVH[DPSOHEXWFRXOGFRQYHUJHDWDQ\WLPHZLWKDSSURSULDWH
3'7DQGVXUYLYDOLQGLFDWLQJWKDWVLQJOHWLPHSRLQWVDUHXQVXLWDEOHIRUFRUUHFWDQDO\VLV,QWKLV
H[DPSOH WKH  GD\ SRLQW FRXOG RYHUHVWLPDWH JURZWK DV WKH FRQWURO KDV VWDUWHG WR SODWHDX
$OWKRXJK WKLV RFFXUV DW  GD\V LQ WKLV H[DPSOH LW FRXOG RFFXU HDUOLHU ZLWK D PRUH UDSLGO\
JURZLQJFHOOOLQH)XUWKHUPRUHDOOFXUYHVFRQYHUJHDWWKHVDPHVDWXUDWLRQGHQVLW\LIOHIWORQJ
HQRXJK 0HDQLQJIXO FRPSDUDWLYH REVHUYDWLRQV FDQ RQO\ EH PDGH ZKLOH DOO FHOOV DUH LQ
H[SRQHQWLDOJURZWK

,QVWDELOLW\DQGSUHVHUYDWLRQ

(DUO\ SDVVDJH FHOO OLQHV DUH XQVWDEOH DV WKH\ JR WKURXJK D SHULRG RI DGDSWDWLRQ WR
FXOWXUH+RZHYHUEHWZHHQDERXWWKHWKDQGWKJHQHUDWLRQ IRUKXPDQGLSORLGILEUREODVWV
RWKHUFHOOW\SHVPD\EHGLIIHUHQW WKHFXOWXUHLVIDLUO\FRQVLVWHQW$VWKHFXOWXUHZLOOVWDUWWR
VHQHVFH DV LW JHWV ROGHU ILQLWH FHOO OLQHV VKRXOG EH XVHG DIWHU WKH SHULRG RI DGDSWDWLRQ EXW
EHIRUHVHQHVFHQFH$VFRQWLQXRXVFHOOOLQHVFDQEHJHQHWLFDOO\XQVWDEOH WKH\VKRXOGRQO\ EH
XVHGFRQWLQXRXVO\IRUDSSUR[LPDWHO\WKUHHPRQWKVEHIRUHVWRFNUHSODFHPHQW6RPHFHOOOLQHV
VXFK DV 7 DQG RWKHUPRXVH OLQHV ZKLFK DUH LPPRUWDO EXW QRW WUDQVIRUPHG FDQ WUDQVIRUP
VSRQWDQHRXVO\ DQG VKRXOG QRW EH SURSDJDWHG IRU SURORQJHG SHULRGV 9DOLGDWHG DQG
DXWKHQWLFDWHGIUR]HQVWRFNVRIDOOFHOOOLQHVVKRXOGEHPDLQWDLQHGWRSURWHFWDJDLQVWFHOOOLQH
LQVWDELOLW\DQGWRJLYHLQVXUDQFHDJDLQVWFRQWDPLQDWLRQLQFXEDWRUIDLOXUHRURWKHUDFFLGHQWDO
ORVV

$QLPDO FHOOFXOWXUHLVDSUHFLVH GLVFLSOLQH%HZDUH RIWKRVH ZKR VD\ LW LV QRW RU LW LV
PDJLF RUGXHWR JUHHQILQJHUV WKH\DUHQRWFRQWUROOLQJDOOWKHYDULDEOHV&RQVLVWHQF\FDQEH
DFKLHYHGDQGWKHIROORZLQJFKDSWHUVDUHLQWHQGHGWRLQGLFDWHKRZEHVWWRFRQWUROFRQGLWLRQV
ZLWKLQWKHSUHVHQWOLPLWDWLRQVRIRXUNQRZOHGJH


5HIHUHQFHV

'R\OH$*ULIILWKV-%DQG1HZDOO'* HG   &HOODQGWLVVXHFXOWXUHODERUDWRU\
SURFHGXUHV:LOH\&KLFKHVWHU
'DYLV - 0 HG    %DVLF FHOO FXOWXUH D SUDFWLFDO DSSURDFK ,5/ 3UHVV DW 2[IRUG
8QLYHUVLW\3UHVV2[IRUG
)UHVKQH\5,  &XOWXUHRIDQLPDOFHOOVDPDQXDORIEDVLFWHFKQLTXHWKHGQ:LOH\
/LVV1HZ<RUN

ϰϰ

)UHVKQH\ 5 ,   )UHVKQH\ V FXOWXUH RI DQLPDO FHOOV D PXOWLPHGLD JXLGH :LOH\,LVV
1HZ<RUN
%R\FH67DQG+DP5*  -,QYHVW'HUPDWRO 6XSSO V
5RRQH\6$<RXQJ6/DQG0HQGHOVRQ&5  )$6(%-
0F&RUPLFN&DQG)UHVKQH\5,  %U-&DQFHU
6SHLUV95D\.3DQG)UHVKQH\5,  %U-&DQFHU
7KRPVRQ$$)RVWHU%$DQG&XQKD*5  'HYHORSPHQW
<HYGRNLPRYD1DQG)UHVKQH\5,  %U-&DQFHU
%HUGLFKHYVN\)*LOEHUW&6KHDUHU0DQG7D\ORU3DSDGLPLWULRX-  -&HOO6FL

)UDPH 0 & )UHVKQH\ 5 , 9DXJKDQ 3 ) *UDKDP ' , DQG 6KDZ 5  
%U-&DQFHU
6SRUQ0%DQG5REHUWV$%  &DQFHU5HV
)ULHQG & 6FKHU :+ROODQG- *DQG 6DWR7   3URF 1DWO $FDG 6UL 86$ 

5DII0&0LOOHU5+DQG1REOH0  1DWXUH
/HFKQHU - ) 0F&OHQGRQ , $ /DYHFN 0 $ 6KDPVXGGLQ $ 0 DQG +DUULV & &
 &DQFHU5HV
&KDPEDUG09HUULHU%*DEULRQ-DQG0DXFKDPS-  -&HOO%LRO
6DWWOHU & $ 0LFKDORSRXORV * 6DWWOHU * / DQG 3LWRW + &   &DQFHU 5HV 

)UHVKQH\5,  &XOWXUHRIHSLWKHOLDOFHOOV:LOH\/LVV1HZ<RUN
*KLJR'3ULRWWR&0LJOLRULQR'*HURPLQ')UDQFKLQR&7RGGH5HWDO  -
&HOO3K\VLRO
3HUHLUD6PLWK20DQG6PLWK-  3URF1DWO$FDG6UL86$
6DVDNL 0 +RQGD 7 <DPDGD + :DNH 1 %DUUHWW - & DQG 2VKLPXUD 0  
&DQFHU5HV
%RGQDU$*2XHOOHWWH0)URONLV0+ROW6(&KLX&30RULQ*%HWDO  
6FLHQFH
*UDQGHU'  0HG2QFRO
)UHVKQH\5,DQG)UHVKQH\0* HG   &XOWXUHRILPPRUWDOL]HGFHOOV:LOH\/LVV
1HZ<RUN
&RXUWHQD\ 9 ' 6HOE\ 3 - 6PLWK , ( 0LOOV - DQG 3HFNKDP 0 -   %U -
&DQFHU
)UHVKQH\0*  ,Q&XOWXUHRIKHPDWRSRLHWLFFHOOV HG5,)UHVKQH\,%3UDJQHOO
DQG0*)UHVKQH\ :LOH\/LVV1HZ<RUNS
9ORGDYVN\,/XL*0DQG*RVSRGDURZLF]'  &HOO
1LFRVLD5)DQG2WWLQHWWL$  ,Q9LWUR
+DP5*DQG0F.HHKDQ:/  ,Q9LWUR
-DFREV-3-RQHV&0DQG%DLOLH-3  1DWXUH
*UHHQ+DQG.HKLQGH2  &HOO
0DFSKHUVRQ,DQG6WRNHU0  9LURORJ\
*DXVK&5+DUG:/DQG6PLWK7)  3URF6RF([S%LRO0HG
*UDKDP)/6PLOH\-5XVVHOO:&DQG1DLUQ5  -*HQ9LURO
.QRZOHV%%+RZH&&DQG$GHQ'3  6FLHQFH
*H\*2&RIIPDQ:'DQG.XELFHN07  &DQFHU5HV
3XFN77DQG0DUFXV3,  3URF1DWO$FDG6UL86$
*OX]PDQ<  &HOO
)RJK-:ULJKW:&DQG/RYHOHVV-'  -1DWO&DQFHU,QVW

ϰϱ

6RXOH+'0DORQH\70:ROPDQ653HWHUVRQ:'%UHQ]50F*UDWK&0HW
DO  &DQFHU5HV
*LDUG ' - $DURQVRQ 6 $ 7RGDUR * - $UQVWHLQ 3 .HUVH\ - + 'RVLN . HW DO
 -1DWO&DQFHU,QVW
*UHHQH/$DQG7LVFKOHU$6  3URF1DWO$FDG6FL86$
*DOODJKHU 5 &ROOLQV 6 7UXMLOOR - 0F&UHGLH . $KHDUQ 0 7VDL 6 HW DO  
%ORRG
*LOOLV6DQG:DWVRQ-  -([S0HG
$QGHUVVRQ/&1LOVVRQ.DQG*DKPEHUJ&*  ,QW-&DQFHU
$QGHUVVRQ/&-RNLQHQ0DQG*DKPEHUJ&*  1DWXUH
0RRUH*(*HUQHU5(DQG)UDQNOLQ+$  -$P0HG$VVRF
(DJOH+  6FLHQFH
'XOEHFFR5DQG)UHHPDQ*  9LURORJ\
+DP5*  3URF1DWO$FDG6FL86$
%DUQHV'DQG6DWR*  $QDO%LRFKHP
/HLERYLW]$  $P-+\J
3HHKO'0DQG+DP5*  ,Q9LWUR
6WDFH\*10DVWHUV-5:+D\5-'UH[OHU+*0DF/HRG5$)DQG)UHVKQH\
5 ,   &HOO FRQWDPLQDWLRQ OHDGV WR LQDFFXUDWH GDWD ZH PXVW WDNH DFWLRQ QRZ
1DWXUH


ϰϲ

 
&KDSWHU
6FDOLQJXSRIDQLPDOFHOOFXOWXUHV

,QWURGXFWLRQ

6PDOOVFDOHFXOWXUHRIFHOOVLQIODVNVRIXSWROLWUHYROXPH FPVXUIDFHDUHD LV
WKHEHVWPHDQVRIHVWDEOLVKLQJQHZFHOOOLQHVLQFXOWXUHIRUVWXG\LQJFHOOPRUSKRORJ\DQGIRU
FRPSDULQJ WKH HIIHFWV RI DJHQWV RQ JURZWK DQG PHWDEROLVP +RZHYHU WKHUH DUH PDQ\
DSSOLFDWLRQVLQZKLFKODUJHQXPEHUVRIFHOOVDUHUHTXLUHGIRUH[DPSOHH[WUDFWLRQRIDFHOOXODU
FRQVWLWXHQW  FHOOV FDQ SURYLGH  PJ '1$  WR SURGXFH YLUXVHV IRU YDFFLQH SURGXFWLRQ
W\SLFDOO\[FHOOVSHUEDWFK RURWKHUFHOOSURGXFWV LQWHUIHURQSODVPLQRJHQDFWLYDWRU
LQWHUOHXNLQVKRUPRQHVHQ]\PHVHU\WKURSRLHWLQDQGDQWLERGLHV DQGWRSURGXFHLQRFXODIRU
HYHQ ODUJHU FXOWXUHV $QLPDO FHOO FXOWXUH LV D ZLGHO\ XVHG SURGXFWLRQ SURFHVV LQ
ELRWHFKQRORJ\ZLWKV\VWHPVLQRSHUDWLRQDWVFDOHVRYHUOLWUHV7KLVKDVEHHQDFKLHYHG
E\ JUDGXDWLQJ IURP PXOWLSOHV RI VPDOO FXOWXUHV DQ DSSURDFK ZKLFK LV WHGLRXV ODERXU
LQWHQVLYHDQGH[SHQVLYHWRWKHXVHRIODUJH XQLWSURFHVV V\VWHPV$OWKRXJKXQLWSURFHVVHVDUH
PRUH FRVWHIIHFWLYH DQG HIILFLHQW DFKLHYLQJ WKH QHFHVVDU\ VFDOHXS KDV UHTXLUHG D VHULHV RI
PRGLILFDWLRQV WR RYHUFRPH OLPLWLQJ IDFWRUV VXFK DV R[\JHQ OLPLWDWLRQ VKHDU GDPDJH DQG
PHWDEROLWHWR[LFLW\2QHRIWKHDLPVRIWKLVFKDSWHULVWRGHVFULEHWKHVHOLPLWDWLRQVLQGLFDWHDW
ZKDW VFDOH WKH\ DUH OLNHO\ WR RFFXU DQG VXJJHVW SRVVLEOH VROXWLRQV 7KLV WKHPH KDV WR EH
DSSOLHGWRFHOOVWKDWJURZLQVXVSHQVLRQDQGWRWKRVHWKDWZLOORQO\JURZZKHQDWWDFKHGWRD
VXEVWUDWH DQFKRUDJHGHSHQGHQW FHOOV  $QRWKHU DVSHFW RI VFDOHXS WKDW ZLOO EH GLVFXVVHG LV
LQFUHDVLQJXQLW FHOO GHQVLW\  WR IROG E\ WKHXVHRIFHOOLPPRELOL]DWLRQDQGSHUIXVLRQ
WHFKQLTXHV )UHH VXVSHQVLRQ FXOWXUH RIIHUV WKH HDVLHVW PHDQV RI VFDOHXS EHFDXVH D  OLWUH
YHVVHOLVFRQFHSWXDOO\YHU\VLPLODUWRDOLWUHYHVVHO7KHFKDQJHVFRQFHUQWKHGHJUHHRI
HQYLURQPHQWDOFRQWURODQGWKHPHDQVRIPDLQWDLQLQJWKHFRUUHFWSK\VLRORJLFDOFRQGLWLRQVIRU
FHOO JURZWK UDWKHU WKDQ VLJQLILFDQWO\ DOWHULQJ YHVVHO GHVLJQ 0RQROD\HU V\VWHPV IRU
DQFKRUDJHGHSHQGHQWFHOOV DUHPRUHGLIILFXOWWRVFDOHXSLQDVLQJOHYHVVHODQGFRQVHTXHQWO\
D ZLGH UDQJH RI GLYHUVH V\VWHPV KDYH HYROYHG 7KH DLP RI LQFUHDVLQJ WKH VXUIDFH DUHD
DYDLODEOH WR WKH FHOOV DQG WKH WRWDO FXOWXUH YROXPH KDV EHHQ VXFFHVVIXOO\ DFKLHYHG DQG WKH
PRVWHIIHFWLYHRIWKHVHPHWKRGV PLFURFDUULHU ZLOOEHGLVFXVVHG

*HQHUDOPHWKRGVDQGFXOWXUHSDUDPHWHUV

)DPLOLDULW\ ZLWK FHUWDLQ ELRORJLFDO FRQFHSWV DQG PHWKRGV LV HVVHQWLDO ZKHQ
XQGHUVWDQGLQJVFDOHXSRIDFXOWXUHV\VWHP,QVPDOOVFDOHFXOWXUHVWKHUHLVOHHZD\IRUVRPH
HUURU ,IWKH FXOWXUH IDLOV LW LV D QXLVDQFH EXW QRW QHFHVVDULO\ D GLVDVWHU/DUJH VFDOHFXOWXUH
IDLOXUHLVQRWRQO\PRUHVHULRXVLQWHUPVRIFRVWEXWDOVRWKHV\VWHPGHPDQGVWKDWFRQGLWLRQV
DUHPRUHFULWLFDOO\PHW7KLVVHFWLRQGHVFULEHVWKHIDFWRUV WKDW QHHGWR EH FRQVLGHUHG DV WKH
FXOWXUHVL]HJHWVODUJHU

&HOOTXDQWLILFDWLRQ

0HDVXULQJ WRWDO FHOO QXPEHUV E\ KDHPRF\WRPHWHU FRXQWV RI ZKROH FHOOV RU VWDLQHG
QXFOHL DQGWRWDOFHOOPDVV E\GHWHUPLQLQJSURWHLQRUGU\ZHLJKW LVHDVLO\DFKLHYHG,WLVIDU
PRUHGLIILFXOWWRJHWDUHOLDEOHPHDVXUHRIFHOOYLDELOLW\EHFDXVHWKHPHWKRGVXVHGHLWKHUVWUHVV
WKH FHOOV RU XVH D VSHFLILF DQG QRW QHFHVVDULO\ W\SLFDO SDUDPHWHU RI FHOO SK\VLRORJ\ $Q
DGGLWLRQDO GLIILFXOW\ LV WKDW LQ PDQ\ FXOWXUH V\VWHPV WKH FHOOV FDQQRW EH VDPSOHG PRVW
ϰϳ

DQFKRUDJHGHSHQGHQWFXOWXUHV RUYLVXDOO\H[DPLQHGDQGDQLQGLUHFWPHDVXUHPHQWKDVWREH
PDGH

&HOOYLDELOLW\

7KHG\HH[FOXVLRQWHVWLVEDVHGRQWKHFRQFHSWWKDWYLDEOHFHOOVGRQRWWDNHXSFHUWDLQ
G\HV ZKHUHDV GHDG FHOOV DUH SHUPHDEOH WR WKHVH G\HV 7U\SDQ EOXH   LV WKH PRVW
FRPPRQO\XVHGG\HEXWKDVWKHGLVDGYDQWDJHRIVWDLQLQJVROXEOHSURWHLQ,QWKHSUHVHQFHRI
VHUXP WKHUHIRUH HU\WKURFLQ %   LV RIWHQ SUHIHUUHG &HOOV DUH FRXQWHG LQ WKH VWDQGDUG
PDQQHUXVLQJ DKDHPRF\WRPHWHU 6RPHFDXWLRQVKRXOG EHXVHG ZKHQLQWHUSUHWLQJ UHVXOWVDV
WKH XSWDNH RI WKH G\H LV S+ DQG FRQFHQWUDWLRQGHSHQGHQW DQG WKHUH DUH VLWXDWLRQV LQ ZKLFK
PLVOHDGLQJ UHVXOWV FDQ EHREWDLQHG 7ZR UHOHYDQW H[DPSOHV DUHPHPEUDQH OHDNLQHVV FDXVHG
E\ UHFHQW WU\SVLQL]DWLRQ DQG IUHH]LQJ DQG WKDZLQJ LQ WKH SUHVHQFH RI GLPHWK\O VXOIR[LGH $
FRORULPHWULFPHWKRGXVLQJWKH077DVVD\FDQEHXVHGERWKWRPHDVXUHYLDELOLW\DIWHUUHOHDVH
RI F\WRSODVPLF FRQWHQWV LQWR WKH PHGLXP IURP DUWLILFLDOO\ O\VHG FHOOV DQG IRU PLFURVFRSLF
YLVXDOL]DWLRQZLWKLQWKHDWWDFKHGFHOO

,QGLUHFWPHDVXUHPHQWV

,QGLUHFWPHDVXUHPHQWVRIYLDELOLW\DUHEDVHGRQPHWDEROLFDFWLYLW\7KHPRVWFRPPRQO\
XVHG SDUDPHWHU LV JOXFRVH XWLOL]DWLRQ EXW R[\JHQ XWLOL]DWLRQ ODFWLF RU S\UXYLF DFLG
SURGXFWLRQRUFDUERQGLR[LGHSURGXFWLRQFDQDOVREHXVHGDVFDQWKHH[SUHVVLRQRIDSURGXFW
VXFKDVDQHQ]\PH:KHQFHOOVDUHJURZLQJORJDULWKPLFDOO\WKHUHLVDYHU\FORVHFRUUHODWLRQ
EHWZHHQ QXWULHQW XWLOL]DWLRQ DQG FHOO QXPEHUV +RZHYHU GXULQJ RWKHU JURZWK SKDVHV
XWLOL]DWLRQUDWHVFDXVHGE\PDLQWHQDQFHUDWKHUWKDQJURZWKFDQJLYHPLVOHDGLQJUHVXOWV7KH
PHDVXUHPHQWV REWDLQHG FDQ EH H[SUHVVHG DV D JURZWK \LHOG <  RU VSHFLILF
XWLOL]DWLRQUHVSLUDWLRQUDWH 4 

7\SLFDOYDOXHVRIJURZWK\LHOGVIRUJOXFRVH FHOOVJ DUH 05&  9HUR DQG

 %+. 

$ PHWKRG ZKLFK LV QRW VR LQIOXHQFHG E\ JURZWK UDWH IOXFWXDWLRQV LV WKH ODFWDWH
GHK\GURJHQDVH /'+ DVVD\/'+LVPHDVXUHGLQFHOOIUHHPHGLXPDWƒ&E\IROORZLQJWKH
R[LGDWLRQRI1$'+E\WKHFKDQJHLQDEVRUEDQFHDWQP7KHUHDFWLRQLVLQLWLDWHGE\WKH
DGGLWLRQRIS\UXYDWH2QHXQLWRIDFWLYLW\LVGHILQHGDVXPROPLQ1$'+FRQVXPHG/'+LV
UHOHDVHG E\ GHDGG\LQJ FHOOV DQG LV WKHUHIRUH D TXDQWLWDWLYH PHDVXUHPHQW RI ORVV RI FHOO
YLDELOLW\7RPHDVXUHYLDEOHFHOOVDUHYHUVHDVVD\FDQEHSHUIRUPHGE\FRQWUROOHGO\VLVRIWKH
FHOOVDQGPHDVXULQJWKHLQFUHDVHLQ/'+

(TXLSPHQWDQGUHDJHQWV
&XOWXUHYHVVHODQGJURZWKVXUIDFHV

7KHVWDQGDUGQRQGLVSRVDEOHPDWHULDOIRUJURZWKRIDQLPDOFHOOVLVJODVVDOWKRXJKWKLV
LVUHSODFHGE\VWDLQOHVVVWHHOLQODUJHUFXOWXUHV,WLVSUHIHUDEOHWRXVHERURVLOLFDWHJODVV HJ

ϰϴ

3\UH[  EHFDXVH LW LV OHVV DONDOLQH WKDQ VRGD JODVV DQG ZLWKVWDQGV KDQGOLQJ DQG DXWRFODYLQJ
EHWWHU&HOOVXVXDOO\DWWDFKUHDGLO\ WRJODVVEXW LIQHFHVVDU\DWWDFKPHQWPD\EHDXJPHQWHG
E\ YDULRXVVXUIDFHWUHDWPHQWV,QVXVSHQVLRQFXOWXUHFHOODWWDFKPHQWKDVWREHGLVFRXUDJHG
DQGWKLVLVDFKLHYHGE\WUHDWPHQWRIWKHFXOWXUHYHVVHOZLWKDSURSULHWDU\VLOLFRQHSUHSDUDWLRQ
VLOLFRQL]DWLRQ  ([DPSOHV DUH 'RZ &RUQLQJ  ZKLFK KDV WR EH EDNHG RQ  RU
GLPHWK\OGLFKORURVLODQH 5HSHOFRWH+RSNLQVDQG:LOOLDPV ZKLFKUHTXLUHVWKRURXJKZDVKLQJ
RIWKHYHVVHOLQGLVWLOOHGZDWHUWRUHPRYHWKHWULFKORURHWKDQHVROYHQW

&RPSOH[ V\VWHPV XVH D FRPELQDWLRQ RI VWDLQOHVV VWHHO DQG VLOLFRQH WXELQJ WR FRQQHFW
YDULRXV FRPSRQHQWV RI WKH V\VWHP 6LOLFRQH WXELQJ LV YHU\ SHUPHDEOH WR JDVHV DQG ORVV RI
GLVVROYHG FDUERQ GLR[LGH FDQ EH D SUREOHP ,W LV DOVR OLDEOH WR UDSLG ZHDU ZKHQ XVHG LQ D
SHULVWDOWLFSXPS7KLFNZDOOHGWXELQJZLWKDGGLWLRQDOVWUHQJWKHQLQJ VOHHYH VKRXOGEHXVHG
&XVWRPPDGH FRQQHFWRUV VKRXOG EH XVHG WR HQVXUH JRRG DVHSWLF FRQQHFWLRQ GXULQJ SURFHVV
RSHUDWLRQ6DIHUHPRYDORIVDPSOHVRIWKHFXOWXUHDWIUHTXHQWLQWHUYDOVLVHVVHQWLDO$QHQWU\
ZLWKDYDFFLQHVWRSSHUWKURXJKZKLFKDK\SRGHUPLFV\ULQJHFDQEHLQVHUWHGSURYLGHVDVLPSOH
VROXWLRQEXWLVRQO\VXLWDEOHIRUVPDOOFXOWXUHV5HSHDWHGSLHUFLQJRIWKHYDFFLQHVWRSSHUFDQ
OHDG WR D ORVV RI FXOWXUH LQWHJULW\ 7KH XVH RI VSHFLDOL]HG VDPSOLQJ GHYLFHV DOVR DYDLODEOH
IURPIHUPHQWHUVXSSO\FRPSDQLHVLVUHFRPPHQGHG7KHVHDXWRPDWLFDOO\HQDEOHWKHOLQHWREH
FOHDUHG RI VWDWLF PHGLXP FRQWDLQLQJ GHDG FHOOV WKXV DYRLGLQJ WKH QHFHVVLW\ RI WDNLQJ VPDOO
LQLWLDOVDPSOHVZKLFKDUHWKHQGLVFDUGHGDQGLQFUHDVLQJWKHFKDQFHVRIUHWDLQLQJVWHULOLW\$LU
ILOWHUVDUHUHTXLUHGIRUWKHHQWU\DQGH[LWRIJDVHV(YHQLIFRQWLQXRXVJDVVLQJLVQRWXVHGRQH
ILOWHU HQWU\ LV XVXDOO\ QHHGHG WR HTXLOLEUDWH SUHVVXUH DQG IRU IRUFHG LQSXW RU ZLWKGUDZDO RI
PHGLXP7KHILOWHUVVKRXOGKDYHDXPUDWLQJDQGEHQRQZHWWDEOH

1RQQXWULWLRQDOPHGLXPVXSSOHPHQWV

6RGLXPFDUER[\PHWK\OFHOOXORVH FHQWUHSRLVHXQLWVRIYLVFRVLW\ LVRIWHQDGGHGWR
PHGLD DW   WR KHOS PLQLPL]H PHFKDQLFDO GDPDJH WR FHOOV FDXVHG E\ VKHDU IRUFHV
JHQHUDWHG E\ WKH VWLUUHU LPSHOOHU IRUFHG DHUDWLRQ RU SHUIXVLRQ 7KLV FRPSRXQG LV PRUH
VROXEOHWKDQPHWK\OFHOOXORVHDQGKDVDKLJKHUVROXELOLW\DWƒ&WKDQDWƒ&

3OXURQLF) WUDGH QDPHIRUSRO\JO\FRO  %$6) :\DQGRW  LV RIWHQ DGGHG WR PHGLD
DW   WR UHGXFH WKH DPRXQW RI IRDPLQJ WKDW RFFXUV LQ VWLUUHG DQGRU DHUDWHG FXOWXUHV
HVSHFLDOO\ ZKHQ VHUXP LV SUHVHQW ,W LV DOVR KHOSIXO LQ UHGXFLQJ FHOO DWWDFKPHQW WR JODVV E\
VXSSUHVVLQJ WKH DFWLRQ RI VHUXP LQ WKH DWWDFKPHQW SURFHVV +RZHYHU LWV PRVW EHQHILFLDO
DFWLRQLVWRSURWHFWFHOOVIURPVKHDUVWUHVVDQGEXEEOHGDPDJHLQVWLUUHGDQGVSDUJHGFXOWXUHV
DQGLWLVHVSHFLDOO\HIIHFWLYHLQORZVHUXPRUVHUXPIUHHPHGLD

3UDFWLFDOFRQVLGHUDWLRQV

x 7HPSHUDWXUHRIPHGLXP$OZD\VSUHZDUPWKHPHGLXPWRWKHRSHUDWLQJWHPSHUDWXUH
XVXDOO\ƒ& DQGVWDELOL]HWKHS+EHIRUHDGGLQJFHOOV6KLIWVLQS+GXULQJWKHLQLWLDO
VWDJHV RI D FXOWXUH FUHDWH PDQ\ SUREOHPV LQFOXGLQJ D ORQJ ODJ SKDVH DQG UHGXFHG
\LHOG
x *URZWKSKDVHRIFHOOV$YRLGXVLQJVWDWLRQDU\SKDVHFHOOVDVLQRFXOXPVEHFDXVHWKLV
ZLOOPHDQD ORQJ ODJ SKDVH RUQRJURZWK DW DOO,GHDOO\FHOOVLQWKHODWHORJDULWKPLF
SKDVHVKRXOGEHXVHG
x ,QRFXODWLRQGHQVLW\$OZD\VLQRFXODWHDW DKLJKHQRXJKFHOOGHQVLW\7KHUHLVQRVHW
UXOHDVWRWKHPLQLPXPLQRFXOXPOHYHOEHORZZKLFKFHOOVZLOOQRWJURZDVWKLVYDULHV

ϰϵ

 EHWZHHQ FHOO OLQHV DQG GHSHQGV RQ WKH FRPSOH[LW\ RI WKH PHGLXP EHLQJ XVHG $V D
JXLGHLWPD\EHEHWZHHQ[DQG;FHOOVPORU[DQG[FHOOVFP
x 6WLUULQJUDWH)LQGHPSLULFDOO\WKHRSWLPXPVWLUULQJUDWHIRUDJLYHQFXOWXUHYHVVHODQG
FHOOOLQH7KLVFRXOGYDU\EHWZHHQUSPIRUVXVSHQVLRQFHOOVEXWLVXVXDOO\
LQWKHUDQJHUSPDQGEHWZHHQUSPIRUPLFURFDUULHUFXOWXUHV
x 0HGLXPDQGVXUIDFHDUHD7KHSURGXFWLYLW\RIWKHV\VWHPGHSHQGVXSRQWKHTXDOLW\
DQGTXDQWLW\RIWKHPHGLXPDQGIRUDQFKRUDJHGHSHQGHQWFHOOVWKHVXUIDFHDUHDIRU
FHOOJURZWK$XQLWYROXPHRIPHGLXPLVRQO\FDSDEOHRIJLYLQJDILQLWH\LHOGRIFHOOV
)DFWRUV ZKLFK DIIHFW WKH \LHOG DUH S+ R[\JHQ OLPLWDWLRQ DFFXPXODWLRQ RI WR[LF
SURGXFWV HJ 1+  QXWULHQW OLPLWDWLRQ HJ JOXWDPLQH  VSDWLDO UHVWULFWLRQV DQG
PHFKDQLFDOVKHDUVWUHVV$VVRRQDVRQHRIWKHVHIDFWRUVFRPHVLQWRHIIHFWWKHFXOWXUH
LV ILQLVKHG DQG WKH UHPDLQLQJ UHVRXUFHV RI WKH V\VWHP DUH ZDVWHG 7KH DLP LV
WKHUHIRUH WR GHOD\ WKH RQVHW RI DQ\ RQH IDFWRU XQWLO WKH DFFXPXODWHG HIIHFW FDXVHV
FHVVDWLRQRIJURZWKDWZKLFKSRLQWWKHV\VWHPKDVEHHQPD[LPDOO\ XWLOL]HG 6LPSOH
ZD\V RI DFKLHYLQJ WKLV DUH D EHWWHU EXIIHULQJ V\VWHP HJ +HSHV LQVWHDG RI
ELFDUERQDWH  FRQWLQXRXV JDVVLQJ JHQHURXV KHDGVSDFH YROXPH HQULFKHG UDWKHU WKDQ
EDVDOPHGLDZLWKQXWULHQWVSDULQJVXSSOHPHQWVVXFKDVQRQHVVHQWLDODPLQRDFLGVRU
ODFWDOEXPLQK\GURO\VDWHSHUIXVLRQORRSVWKURXJKXOWUDILOWUDWLRQPHPEUDQHVRUGLDO\VLV
WXELQJIRUGHWR[LILFDWLRQDQGR[\JHQDWLRQDQGDWWHQWLRQWRFXOWXUHDQGSURFHVVGHVLJQ

*URZWKNLQHWLFV

7KHVWDQGDUGIRUPDWRIDFXOWXUHF\FOHEHJLQQLQJZLWKDODJSKDVHSURFHHGLQJWKURXJK
WKH ORJDULWKPLF SKDVH WR D VWDWLRQDU\ SKDVH DQG ILQDOO\ WR WKH GHFOLQHDQG GHDWK RI FHOOV LV
ZHOOGRFXPHQWHG$OWKRXJKFHOOJURZWKXVXDOO\LPSOLHVLQFUHDVHLQFHOOQXPEHUVLQFUHDVHLQ
FHOOPDVVFDQRFFXUZLWKRXWDQ\UHSOLFDWLRQ7KHGLIIHUHQFHLQPHDQFHOOPDVVEHWZHHQFHOO
SRSXODWLRQV LV FRQVLGHUDEOH DV ZRXOG EH H[SHFWHG EXW VR LV WKH YDULDWLRQ ZLWKLQ WKH VDPH
SRSXODWLRQ*URZWK LQFUHDVHLQFHOOQXPEHUVRUPDVV FDQEHGHILQHGLQWKHIROORZLQJWHUPV

D  6SHFLILF JURZWK UDWH — LH WKH UDWH RI JURZWK SHU XQLW DPRXQW ZHLJKWQXPEHUV  RI
ELRPDVV 



ZKHUH G[ LV WKH LQFUHDVH LQ FHOO PDVV GW LV WKH WLPH LQWHUYDO DQG [ LV WKH FHOO PDVV ,I WKH
JURZWKUDWHLVFRQVWDQW HJGXULQJORJDULWKPLFJURZWK WKHQ


ZKHUH;LVWKHELRPDVVDWWLPHW
E 'RXEOLQJWLPHWG LHWKHWLPHIRUDSRSXODWLRQWRGRXEOHLQQXPEHUPDVV 


F  'HJUHH RI PXOWLSOLFDWLRQ Q RU QXPEHU RI GRXEOLQJV LH WKH QXPEHU RI WLPHV WKH
LQRFXOXPKDVUHSOLFDWHG 

ϱϬ

 

0HGLXPDQGQXWULHQWV

$ JLYHQ FRQFHQWUDWLRQ RI QXWULHQWV FDQ RQO\ VXSSRUW D FHUWDLQ QXPEHU RI FHOOV
$OWHUQDWLYHQXWULHQWVFDQ RIWHQ EHIRXQG E\ D FHOOZKHQRQHEHFRPHVH[KDXVWHGEXWWKLV LV
EDGSUDFWLFHEHFDXVH WKH JURZWK UDWH LVDOZD\V UHGXFHG HJZKLOHDOWHUQDWLYHHQ]\PHV DUH
EHLQJ LQGXFHG  ,I D PLQLPDO PHGLXP VXFK DV (DJOH V EDVDO PHGLXP %0(  RU PLQLPXP
HVVHQWLDO PHGLXP 0(0  LV XVHG ZLWK VHUXP DV WKH RQO\ VXSSOHPHQW WKHQ WKLV SUREOHP LV
JRLQJ WR EH PHW VRRQHU WKDQ LQ FXOWXUHV XVLQJ FRPSOHWH PHGLD HJ   RU LQ PHGLD
VXSSOHPHQWHG ZLWK ODFWDOEXPLQ K\GURO\VDWH SHSWRQH RU %6$ ZKLFK SURYLGHV PDQ\ RI WKH
IDWW\ DFLGV  1XWULHQWV OLNHO\ WR EH H[KDXVWHG ILUVW DUH JOXWDPLQH SDUWO\ EHFDXVH LW
VSRQWDQHRXVO\ F\FOL]HV WR S\UUROLGRQH FDUER[\OLF DFLG DQG LV HQ]\PLFDOO\ FRQYHUWHG E\
VHUXPDQGFHOOXODU HQ]\PHV  WRJOXWDPLF DFLG OHXFLQHDQGLVROHXFLQH+XPDQGLSORLGFHOOV
DUHDOPRVWXQLTXHLQXWLOL]LQJF\VWLQHKHDYLO\$SRLQWWRUHPHPEHULVWKDWQXWULHQWVEHFRPH
JURZWKOLPLWLQJEHIRUHWKH\EHFRPHH[KDXVWHG$VWKHFRQFHQWUDWLRQRIDPLQRDFLGVIDOOVWKH
FHOO ILQGV LW LQFUHDVLQJO\ GLIILFXOW WR PDLQWDLQ VXIILFLHQW LQWUDFHOOXODU SRRO OHYHOV 7KLV LV
H[DJJHUDWHGLQPRQROD\HUFXOWXUHVEHFDXVHDVFHOOVEHFRPHPRUHWLJKWO\SDFNHGWRJHWKHUWKH
VXUIDFHDUHDDYDLODEOHIRUQXWULHQWXSWDNHEHFRPHVVPDOOHU*OXFRVHLVRIWHQDQRWKHUOLPLWLQJ
IDFWRUDVLWLVGHVWUXFWLYHO\XWLOL]HGE\FHOOVDQGUDWKHUWKDQDGGLQJKLJKFRQFHQWUDWLRQVDWWKH
EHJLQQLQJLWLVPRUHEHQHILFLDOWRVXSSOHPHQWDIWHUWZRWRWKUHHGD\V7RPDLQWDLQDFXOWXUH
VRPH DGGLWLRQDO IHHGLQJ RIWHQ KDV WR EH FDUULHG RXW HLWKHU E\ FRPSOHWH RU SDUWLDO PHGLD
FKDQJHVRUE\SHUIXVLRQ0DQ\FHOOW\SHVDUHHLWKHUWRWDOO\GHSHQGHQWXSRQFHUWDLQDGGLWLYHV
RU FDQ RQO\ SHUIRUP RSWLPDOO\ ZKHQ WKH\ DUH SUHVHQW )RU PDQ\ SXUSRVHV LW LV KLJKO\
GHVLUDEOH RU HYHQ HVVHQWLDO WR UHGXFH WKH VHUXP OHYHO WR  RU EHORZ 7R DFKLHYH WKLV
ZLWKRXWDVLJQLILFDQWUHGXFWLRQLQFHOO\LHOGYDULRXVJURZWKIDFWRUVDQGKRUPRQHVDUHDGGHG
WRWKHEDVDO PHGLXP 7KH PRVW FRPPRQ DGGLWLYHV DUHLQVXOLQ PJOLWUH WUDQVIHUULQ 
PJOLWUH  HWKDQRODPLQH  —0  DQG VHOHQLXP  —JOLWUH  &HOO DJJUHJDWLRQ LV RIWHQ D
SUREOHP LQ VXVSHQVLRQ FXOWXUHV 0HGLD ODFNLQJ FDOFLXP DQG PDJQHVLXP LRQV KDYH EHHQ
GHVLJQHGVSHFLILFDOO\IRUVXVSHQVLRQFHOOVEHFDXVHRIWKHUROHRIWKHVHLRQVLQDWWDFKPHQW7KLV
SUREOHP KDVDOVR EHHQRYHUFRPH E\LQFOXGLQJ YHU\ ORZ OHYHOV RI WU\SVLQ LQ WKH PHGLXP 
—JPO 

S+

,GHDOO\S+VKRXOGEHQHDUDWWKHLQLWLDWLRQRIDFXOWXUHDQGQRWIDOOEHORZDYDOXHRI
GXULQJWKHFXOWXUHDOWKRXJKPDQ\K\EULGRPDOLQHVDSSHDUWRSUHIHUDS+RIRUORZHU
$S+EHORZLVXVXDOO\LQKLELWRU\WRFHOOJURZWK)DFWRUVDIIHFWLQJWKHS+VWDELOLW\RIWKH
PHGLXP DUH EXIIHU FDSDFLW\ DQG W\SH KHDGVSDFH DQG JOXFRVH FRQFHQWUDWLRQ 7KH QRUPDO
EXIIHUV\VWHPLQWLVVXHFXOWXUHPHGLDLVWKHFDUERQGLR[LGHELFDUERQDWHV\VWHPDQDORJRXVWR
WKDWLQEORRG7KLVLVDZHDNEXIIHUV\VWHPLQWKDWLWKDVDS.DZHOOEHORZWKHSK\VLRORJLFDO
RSWLPXP,WDOVRUHTXLUHVWKHDGGLWLRQRIFDUERQGLR[LGHWRWKHKHDGVSDFHDERYHWKHPHGLXP
WRSUHYHQWWKHORVVRIFDUERQGLR[LGHDQGDQLQFUHDVHLQK\GUR[\OLRQV7KHEXIIHULQJFDSDFLW\
RI WKH PHGLXP LV LQFUHDVHG E\ WKH SKRVSKDWHV SUHVHQW LQ WKH EDODQFHG VDOW VROXWLRQ %66 
0HGLXPLQWHQGHGWRHTXLOLEUDWHZLWKFDUERQGLR[LGHXVXDOO\FRQWDLQ(DUOH V%66 P0
1D+&2  EXW DQ DOWHUQDWLYH LV +DQNV  %66  P0 1D+&2  IRU HTXLOLEUDWLRQ ZLWK DLU
,PSURYHGEXIIHULQJDQGS+VWDELOLW\LQPHGLDLVSRVVLEOHE\XVLQJD]ZLWWHULRQLFEXIIHUVXFK
DV+HSHV P0 HLWKHULQDGGLWLRQWRRULQVWHDGRIELFDUERQDWH LQFOXGHELFDUERQDWHDW

ϱϭ

 P0  $OWHUQDWLYH EXIIHU V\VWHPV DUH SURYLGHG E\ XVLQJ VSHFLDOLVW PHGLD VXFK DV
/HLERYLW] V/7KLVPHGLXPXWLOL]HVWKHEXIIHULQJFDSDFLW\RIIUHHDPLQRDFLGVVXEVWLWXWHV
JDODFWRVH DQG S\UXYDWH IRU JOXFRVH DQG RPLWV VRGLXP ELFDUERQDWH ,W LV VXLWDEOH IRU RSHQ
FXOWXUHV

7KHKHDGVSDFHYROXPHLQDFORVHGFXOWXUHLVLPSRUWDQWEHFDXVHLQWKHLQLWLDOVWDJHVRI
WKHFXOWXUHFDUERQGLR[LGHLVQHHGHGWRPDLQWDLQDVWDEOHS+LQWKHPHGLXPEXWDVWKH
FHOOV JURZ DQG JHQHUDWH FDUERQ GLR[LGH LW EXLOGV XS LQ WKH KHDGVSDFH DQG WKLV SUHYHQWV LW
GLIIXVLQJ RXW RI WKH PHGLXP 7KH UHVXOW LV DQ LQFUHDVH LQ ZHDNO\ GLVVRFLDWHG ELFDUERQDWH
SURGXFLQJ DQ H[FHVV RI K\GURJHQ LRQV LQ WKH PHGLXP DQG D IDOO LQ S+ 7KXV D ODUJH
KHDGVSDFH LV UHTXLUHG LQ FORVHG FXOWXUHV W\SLFDOO\ WHQIROG JUHDWHU WKDQ WKH PHGLXP YROXPH
WKLV YROXPH LV DOVR QHHGHG WR VXSSO\ DGHTXDWH R[\JHQ  7KLV JHQHURXV KHDGVSDFH LV QRW
SRVVLEOHDVFXOWXUHVDUHVFDOHGXSDQGDQRSHQV\VWHPZLWKDFRQWLQXRXVIORZRIDLUVXSSOLHG
WKURXJKRQHILOWHUDQGH[WUDFWHGWKURXJKDQRWKHULVUHTXLUHG7KHPHWDEROLVPRIJOXFRVHE\
FHOOVUHVXOWVLQWKHDFFXPXODWLRQRIS\UXYLFDQGODFWLFDFLGV*OXFRVHLVPHWDEROL]HGDWDIDU
JUHDWHU UDWH WKDQ LW LV QHHGHG 7KXV JOXFRVH VKRXOG LGHDOO\ QHYHU EH LQFOXGHG LQ PHGLD DW
FRQFHQWUDWLRQV DERYH  JOLWUH DQG LW LV EHWWHU WR VXSSOHPHQW GXULQJ WKH FXOWXUH WKDQ WR
LQFUHDVH WKH LQLWLDO FRQFHQWUDWLRQ $Q DOWHUQDWLYH LV WR VXEVWLWXWH JOXFRVH E\ JDODFWRVH RU
IUXFWRVHDV WKLV VLJQLILFDQWO\ UHGXFHV WKH IRUPDWLRQ RI ODFWLF DFLG EXW LW XVXDOO\ UHVXOWV LQ D
VORZHU JURZWK UDWH 7KHVH SUHFDXWLRQV GHOD\ WKH RQVHW RI D QRQSK\VLRORJLFDO S+ DQG DUH
VXIILFLHQW IRU VPDOO FXOWXUHV $V VFDOHXS LQFUHDVHV KHDGVSDFH YROXPH DQG FXOWXUH VXUIDFH
DUHD LQ UHODWLRQ WR WKH PHGLXP YROXPH GHFUHDVH $OVR PDQ\ V\VWHPV DUH GHYHORSHG WR
LQFUHDVH WKH VXUIDFH DUHD IRU FHOO DWWDFKPHQW DQG FHOO GHQVLW\ SHU XQLW YROXPH 7KXV S+
SUREOHPV RFFXU IDU HDUOLHU LQ WKH FXOWXUH F\FOH EHFDXVH FDUERQ GLR[LGH FDQQRW HVFDSH DV
UHDGLO\ DQG PRUH FHOOV PHDQV KLJKHU SURGXFWLRQ RI ODFWLF DFLG DQG FDUERQ GLR[LGH 7KH
DQVZHU LV WR FDUU\ RXW IUHTXHQW PHGLXP FKDQJHV RU XVH SHUIXVLRQ RU KDYH D S+ FRQWURO
V\VWHP 7KH EDVLV RID S+ FRQWURO V\VWHP LV DQ DXWRFODYDEOH S+ SUREH DYDLODEOH IURP 3\H
,QJROG5XVVHOO 7KLVIHHGVDVLJQDOWRWKHS+FRQWUROOHUZKLFKLVFRQYHUWHGWRJLYHDGLJLWDO
RU DQDORJXH GLVSOD\ RI WKH S+ 7KLV LV D S+ PRQLWRU V\VWHP &RQWURO RI S+ UHTXLUHV WKH
GHILQLQJRIKLJKDQGORZS+YDOXHVEH\RQGZKLFKWKHS+VKRXOGQRWJR7KHVHWZRVHWSRLQWV
RQWKHS+VFDOHWXUQRQDUHOD\WRDFWLYDWHDSXPSRUVROHQRLGYDOYHZKLFKDOORZVDGGLWLRQV
RIDFLGRUDONDOLWREHPDGHWRWKHFXOWXUHWREULQJLWEDFNWRZLWKLQWKHDOORZDEOHXQLWV,WLV
UDUH WR KDYH WKH S+ ULVH DERYH WKH VHW SRLQW RQFH WKH PHGLXP KDV HTXLOLEUDWHG ZLWK WKH
KHDGVSDFHVRWKHDGGLWLRQRIDFLGFDQEHGLVUHJDUGHG,IDQDONDOLLVWREHDGGHGWKHQVRGLXP
ELFDUERQDWH  LVUHFRPPHQGHG6RGLXPK\GUR[LGH 0 FDQEHXVHGRQO\ZLWKDIDVW
VWLUULQJUDWHZKLFKGLOXWHVWKHDONDOLEHIRUHORFDOL]HGFRQFHQWUDWLRQVFDQGDPDJHWKHFHOOVRU
LIDSHUIXVLRQORRSLVLQVWDOOHG1RUPDOO\OLTXLGGHOLYHU\SXPSVDUHVXSSOLHGDVSDUWRIWKHS+
FRQWUROOHU*DVVXSSO\LVFRQWUROOHGE\DVROHQRLGYDOYHDQGDLUGLUHFWO\$ERYHWKHVHW
SRLQWFDUERQGLR[LGHZLOOEHPL[HGZLWKWKHDLUEXWEHORZWKLVSRLQWRQO\DLUZLOOEHGHOLYHUHG
WRWKHFXOWXUH7KLVLQLWVHOILVDFRQWUROOLQJIDFWRULQWKDWLWKHOSVUHPRYHFDUERQGLR[LGHDV
ZHOO DV PHHWLQJ WKH R[\JHQ UHTXLUHPHQWV RI WKH FXOWXUHV S+ UHJXODWLRQ LV YHU\ UHDGLO\
DGDSWHGWRFRPSXWHUFRQWUROV\VWHPV

2[\JHQ

7KH VFDOHXS RI DQLPDO FHOO FXOWXUHV LV YHU\ GHSHQGHQW XSRQ WKH DELOLW\ WR VXSSO\
VXIILFLHQWR[\JHQZLWKRXW FDXVLQJ FHOO GDPDJH2[\JHQ LVRQO\ VSDULQJO\ VROXEOHLQFXOWXUH
PHGLD —JPO DQGDVXUYH\RIUHSRUWHGR[\JHQXWLOL]DWLRQUDWHVE\FHOOVUHYHDOVDPHDQ
YDOXHRI—JFHOOVK$W\SLFDOFXOWXUHRI[ FHOOVPOZRXOGWKHUHIRUHGHSOHWHWKH
R[\JHQFRQWHQWRIWKHPHGLXP —JPO LQXQGHUK,WLVQHFHVVDU\WRVXSSO\R[\JHQWR

ϱϮ

WKHPHGLXP WKURXJKRXWWKHOLIHRIWKHFXOWXUHDQGWKH DELOLW\ WR GR WKLV DGHTXDWHO\ GHSHQGV
XSRQWKHR[\JHQWUDQVIHUUDWH 275 RIWKHV\VWHP


ZKHUH 275 LV WKH DPRXQW RI R[\JHQ WUDQVIHUUHG SHU XQLW YROXPH LQ XQLW WLPH .O LV WKH
R[\JHQ WUDQVIHU FRHIILFLHQW DQGD LV WKH DUHD RI WKH LQWHUIDFH DFURVV ZKLFK R[\JHQ WUDQVIHU
RFFXUV DVWKLVFDQRQO\EHPHDVXUHGLQVWDWLRQDU\DQGVXUIDFHDHUDWHGFXOWXUHVWKHYDOXH-&OD
LV XVHG WKLV LV WKH PDVV WUDQVIHU FRHIILFLHQW YROK  &  LV WKH FRQFHQWUDWLRQ RI GLVVROYHG
R[\JHQZKHQPHGLXPLVVDWXUDWHGDQG&LVWKHDFWXDOFRQFHQWUDWLRQRIR[\JHQDWDQ\JLYHQ
WLPH7KH.OD 275&ZKHQ&  LVLQXQLWVRIKKRXUVDQGLVWKXVDPHDVXUHRIWKH
WLPHWDNHQWRR[\JHQDWHDJLYHQFXOWXUHYHVVHOFRPSOHWHO\XQGHUDSDUWLFXODUVHWRIFRQGLWLRQV

$ FXOWXUH FDQ EH DHUDWHG E\ RQH RU D FRPELQDWLRQ RI WKH IROORZLQJ PHWKRGV VXUIDFH
DHUDWLRQVSDUJLQJPHPEUDQHGLIIXVLRQPHGLXPSHUIXVLRQLQFUHDVLQJWKHSDUWLDOSUHVVXUHRI
R[\JHQDQGLQFUHDVLQJWKHDWPRVSKHULFSUHVVXUH

6XUIDFHDHUDWLRQVWDWLFFXOWXUHV

,Q D FORVHG V\VWHP VXFK DV D VHDOHG IODVN WKH LPSRUWDQW IDFWRUV DUH WKH DPRXQW RI
R[\JHQLQWKHV\VWHPDQGWKHDYDLODELOLW\RIWKLVR[\JHQWRWKHFHOOVJURZLQJXQGHUPPRI
PHGLXP 1RUPDOO\ D KHDGVSDFHPHGLXP YROXPH UDWLR RI  LV XVHG WR SURYLGH VXIILFLHQW
R[\JHQ7KXVDOLWUHIODVN HJD5RX[ERWWOH ZLWKPORIDLUDQGPORIPHGLXP
ZLOOLQLWLDOO\FRQWDLQJR[\JHQ 7DEOH 7KLVDPRXQWZLOOVXSSRUWFHOOVIRUK
DQGLVWKXVFOHDUO\DGHTXDWH7KHVHFRQGIDFWRULVZKHWKHUWKLVR[\JHQFDQEHPDGHDYDLODEOH
WR WKH FHOOV 7KH WUDQVIHU UDWH RI R[\JHQ IURP WKH JDV SKDVH LQWR D OLTXLG SKDVH KDV EHHQ
FDOFXODWHGDWMXJFPK$JDLQWKLVLVZHOOLQH[FHVVRIWKDWUHTXLUHGE\FHOOVLQDOLWUH
IODVN +RZHYHU LI WKH VXUIDFH LV DVVXPHG WR EH VDWXUDWHG ZLWK GLVVROYHG R[\JHQ DQG WKH
FRQFHQWUDWLRQDWWKHFHOOVKHHWLVDOPRVW]HURWKHQDSSO\LQJ)LFN VODZRIGLIIXVLRQWKHUDWHDW
ZKLFK R[\JHQ FDQ GLIIXVH WR WKH FHOOV LV DERXW  —J FPK $W WKLV UDWH WKHUH LV RQO\
VXIILFLHQW R[\JHQ WR VXSSRUW DERXW  [  FHOOV LQ D  OLWUH IODVN D FHOO GHQVLW\ ZKLFK LQ
SUDFWLFHPDQ\WLVVXHFXOWXULVWVWDNHDVWKHQRUP7KHVHFDOFXODWLRQVVKRZWKHLPSRUWDQFHRI
PDLQWDLQLQJDODUJHKHDGVSDFHYROXPHRWKHUZLVHR[\JHQOLPLWDWLRQFRXOGEHFRPHRQHRIWKH
JURZWKOLPLWLQJIDFWRUVLQVWDWLFFORVHGFXOWXUHV

7DEOH2[\JHQFRQFHQWUDWLRQVRQWKHJDVDQGOLTXLGSKDVHVRID5RX[ERWWOHFXOWXUH

2[\JHQ,QPODLU;; J
2[\JHQ,QPOPHGLXP;; J
1RWHV
 SURSRUWLRQRIR[\JHQLQDLU
 PROHFXODUZHLJKWRIR[\JHQ
 JUDPPROHFXODUYROXPH
[ VROXELOLW\RIR[\JHQLQZDWHUDWƒ&ZKHQHTXLOLEUDWHGZLWKDLU


6SDUJLQJ

7KLVLVWKHEXEEOLQJRIJDVWKURXJKWKHFXOWXUHDQGLVDYHU\HIILFLHQWPHDQVRIHIIHFWLQJ
R[\JHQ WUDQVIHU DV SURYHQ LQ EDFWHULDO IHUPHQWDWLRQ  +RZHYHU LW PD\ EH GDPDJLQJ WR

ϱϯ

DQLPDOFHOOVGXHWRWKHHIIHFWRIWKHKLJKVXUIDFHHQHUJ\RIWKHEXEEOHRQWKHFHOOPHPEUDQH
7KLVGDPDJLQJHIIHFWFDQEHPLQLPL]HGE\XVLQJODUJHDLUEXEEOHV ZKLFKKDYHORZHUVXUIDFH
HQHUJLHV WKDQ VPDOO EXEEOHV  E\ XVLQJ D YHU\ ORZ JDVVLQJ UDWH HJ  PO PLQ  DQG E\
DGGLQJ3OXURQLF)$VSHFLDOL]HGIRUPRIVSDUJLQJWKHDLUOLIWIHUPHQWHUKDVDOVREHHQXVHG
LQODUJHXQLWSURFHVVPRQROD\HUFXOWXUHV HJPXOWLSOHSODWHSURSDJDWRUV :KHQVSDUJLQJLV
XVHG HIILFLHQF\ RI R[\JHQDWLRQ LV LQFUHDVHG E\ XVLQJ D FXOWXUH YHVVHO ZLWK D ODUJH
KHLJKWGLDPHWHU UDWLR 7KLV FUHDWHV D KLJKHU SUHVVXUH DW WKH EDVH RI WKH UHDFWRU ZKLFK
LQFUHDVHVR[\JHQVROXELOLW\

0HPEUDQHGLIIXVLRQ

6LOLFRQHWXELQJLVYHU\SHUPHDEOHWRJDVHVDQGLIORQJOHQJWKVRIWKLQZDOOHGWXELQJFDQ
EHDUUDQJHGLQWKH FXOWXUH YHVVHO WKHQVXIILFLHQWGLIIXVLRQ RI R[\JHQLQWRWKHFXOWXUHFDQEH
REWDLQHG+RZHYHUDORW RIWXELQJLVUHTXLUHG HJ PRI FP WXELQJ IRU D  OLWUH
FXOWXUH 7KLVPHWKRGLVH[SHQVLYHDQGLQFRQYHQLHQWWRXVHDQGKDVWKHLQKHUHQWSUREOHPWKDW
VFDOHXSRIWKHWXELQJUHTXLUHGLVPDLQO\WZRGLPHQVLRQDOZKLOHWKDWRIWKHFXOWXUHLVWKUHH
GLPHQVLRQDO+RZHYHUVHYHUDOFRPPHUFLDOV\VWHPVDUHDYDLODEOH HJ%UDXQ 

0HGLXPSHUIXVLRQ

$FORVHGORRS SHUIXVLRQV\VWHP FRQWLQXRXVO\ RU RQ GHPDQG  WDNHV PHGLXP IURP WKH
FXOWXUHSDVVHVLWWKURXJKDQR[\JHQDWLRQFKDPEHUDQGUHWXUQVLWWRWKHFXOWXUH7KLVPHWKRG
KDV PDQ\ DGYDQWDJHV LI WKH PHGLXP FDQ EH FRQYHQLHQWO\ VHSDUDWHG IURP WKH FHOOV IRU
SHUIXVLRQWKURXJKWKHORRS7KHPHGLXPLQWKHFKDPEHUFDQEHYLJRURXVO\VSDUJHGWRHQVXUH
R[\JHQ VDWXUDWLRQ DQG RWKHU DGGLWLRQV VXFK DV VRGLXP K\GUR[LGH IRU S+ FRQWURO ZKLFK
ZRXOGGDPDJHWKHFHOOVLISXWGLUHFWO\LQWRWKHFXOWXUHFDQEHPDGH7KLVPHWKRGLVXVHGLQ
JODVV EHDG V\VWHPV DQG KDV SURYHG SDUWLFXODUO\ HIIHFWLYH LQ PLFURFDUULHU V\VWHPV ZKHUH
VSHFLDOO\PRGLILHGVSLQILOWHUVFDQEHXVHG

(QYLURQPHQWDOVXSSO\

7KHGLVVROYHGR[\JHQFRQFHQWUDWLRQFDQEHLQFUHDVHGE\LQFUHDVLQJWKHKHDGVSDFHS2
IURPDWPRVSKHULFWRDQ\YDOXHXVLQJR[\JHQDQGQLWURJHQPL[WXUHV DQGE\UDLVLQJWKH
SUHVVXUH RI WKHFXOWXUHE\ N3D DERXW DWP  ZKLFKLQFUHDVHV WKH VROXELOLW\ RI R[\JHQ
DQGLWVGLIIXVLRQUDWH 7KHVHPHWKRGVVKRXOGEHXVHGRQO\ZKHQWKHFXOWXUHLVZHOODGYDQFHG
RWKHUZLVHR[\JHQWR[LFLW\FRXOGRFFXU)LQDOO\WKHJHRPHWU\RIWKHVWLUUHUEODGHDOVRDIIHFWV
WKHR[\JHQWUDQVIHUUDWH

6FDOHXS

2[\JHQ OLPLWDWLRQ LV XVXDOO\ WKH ILUVW IDFWRU WR EH RYHUFRPH LQ FXOWXUH VFDOHXS 7KLV
EHFRPHV D SUREOHP LQ FRQYHQWLRQDO VWLUUHG FXOWXUHV DW YROXPHV DERYH  OLWUHV +RZHYHU
ZLWKWKHFXUUHQWXVHRIKLJKGHQVLW\FXOWXUHVPDLQWDLQHGE\SHUIXVLRQR[\JHQOLPLWDWLRQFDQ
RFFXULQ D  OLWUH FXOWXUH 7KH UHODWLYH HIIHFWLYHQHVV RI VRPH RI WKHDOWHUQDWLYH R[\JHQDWLRQ
V\VWHPV LQ ODUJH VFDOH ELRUHDFWRUV LV VKRZQ LQ 7DEOH  DQG WKH UDQJH RI R[\JHQDWLRQ
SURFHGXUHVLQYDULRXVW\SHVRIFXOWXUHYHVVHOVKDVEHHQUHYLHZHG




ϱϰ

7DEOH0HWKRGVRIR[\JHQDWLQJDOLWUHELRUHDFWRU OLWUHZRUNLQJYROXPHZLWKD
DVSHFWUDWLR 
1R FHOOV [
2[\JHQ PO
2[\JHQDWLQJPHWKRG GHOLYHU\ PJOLWUHK  VXSSRUWHG
$LU POPLQDWUSP 
6XUIDFHDHUDWLRQ  
'LUHFWVSDUJLQJ  
6SLQILOWHUVSDUJLQJ  
3HUIXVLRQ YROK   
3HUIXVLRQ YROK VSLQILOWHUVSDUJLQJ  
2[\JHQ POPOQDWUSP 
6SLQILOWHUVSDUJLQJ  
 SHUIXVLRQ  YROK  DVVXPLQJ R[\JHQ
XWLOL]DWLRQUDWHRI—JFHOOVK   

5HGR[SRWHQWLDO

7KHR[LGDWLRQUHGXFWLRQSRWHQWLDO 253 RUUHGR[SRWHQWLDOLVDPHDVXUHRIWKHFKDUJH
RI WKH PHGLXP DQG LV DIIHFWHG E\ WKH SURSRUWLRQ RI R[LGDWLYH DQG UHGXFLQJ FKHPLFDOV WKH
R[\JHQFRQFHQWUDWLRQDQGWKHS+:KHQIUHVKPHGLXPLVSUHSDUHGDQGSODFHGLQWKHFXOWXUH
YHVVHOLWWDNHV WLPH IRUWKH UHGR[ SRWHQWLDO WR HTXLOLEUDWH DSKHQRPHQRQNQRZQDVSRLVLQJ
7KHRSWLPXPOHYHOIRUPDQ\FHOOOLQHVLVP9ZKLFKFRUUHVSRQGVWRDGLVVROYHGS2 RI
 6RPH LQYHVWLJDWRUV ILQG LW EHQHILFLDO WR FRQWURO WKH R[\JHQ VXSSO\ WR WKH FXOWXUH E\
UHGR[UDWKHUWKDQDQR[\JHQHOHFWURGH$OWHUQDWLYHO\LIWKHUHGR[SRWHQWLDOLVPRQLWRUHGE\D
UHGR[ HOHFWURGH DQG S+ PHWHU ZLWK P9 GLVSOD\  WKHQ DQ LQGLFDWLRQ RI KRZ FHOO JURZWK LV
SURJUHVVLQJFDQEHREWDLQHG7KLVLVEHFDXVHWKHUHGR[YDOXHIDOOVGXULQJORJDULWKPLFJURZWK
DQG UHDFKHV D PLQLPXP YDOXH DSSUR[LPDWHO\  K EHIRUH WKH RQVHW RI WKH VWDWLRQDU\ SKDVH
)LJXUH 7KLVSURYLGHVDXVHIXOJXLGHWRFHOOJURZWKLQFXOWXUHVZKHUHFHOOVDPSOLQJLVQRW
SRVVLEOH,WLVDOVRXVHIXOWREHDEOHWRSUHGLFWWKHHQGRIWKHORJDULWKPLFJURZWKSKDVHVRWKDW
PHGLXPFKDQJHVDGGLWLRQRIYLUXVRUSURGXFWSURPRWHUVFDQEHJLYHQDWWKHRSWLPXPWLPH



)LJXUH&KDQJHVLQR[\JHQUHGXFWLRQSRWHQWLDO 253 FRUUHODWHGWRFHOOJURZWKDQG
JOXFRVH JOF  XWLOL]DWLRQ 7KH PLQLPXP 253 YDOXH $  LV UHDFKHG  K EHIRUH WKH HQG RI

ϱϱ

ORJDULWKPLFJURZWKLQGLFDWHGE\WKHPD[LPXPFHOOQXPEHU % 7KHXSSHU FXUYH VKRZV WKH
WRWDOQXPEHURIFHOOVZKLOHWKHORZHUFXUYHVKRZVWKHQXPEHURIDWWDFKHGFHOOV


7\SHVRIFXOWXUHSURFHVV
%DWFKDQGFRQWLQXRXVFXOWXUH

,QVWDQGDUGFXOWXUHNQRZQDVEDWFKFXOWXUHFHOOVDUHLQRFXODWHGLQWRDIL[HGYROXPHRI
PHGLXP DQG DV WKH\ JURZ QXWULHQWV DUH FRQVXPHG DQG PHWDEROLWHV DFFXPXODWH 7KH
HQYLURQPHQW LV WKHUHIRUH FRQWLQXDOO\ FKDQJLQJ DQG WKLV LQ WXUQ HQIRUFHV FKDQJHV WR FHOO
PHWDEROLVPRIWHQUHIHUUHG WRDV SK\VLRORJLFDO GLIIHUHQWLDWLRQ (YHQWXDOO\FHOOPXOWLSOLFDWLRQ
FHDVHVEHFDXVHRIH[KDXVWLRQRIQXWULHQW V DFFXPXODWLRQRIWR[LFZDVWHSURGXFWVRUGHQVLW\
GHSHQGHQWOLPLWDWLRQRIJURZWKLQPRQROD\HUFXOWXUHV7KHUHDUHPHDQVRISURORQJLQJWKHOLIH
RIDEDWFKFXOWXUHDQGWKXVLQFUHDVLQJWKH\LHOGE\YDULRXVVXEVWUDWHVIHHGPHWKRGV

D *UDGXDODGGLWLRQRIIUHVKPHGLXPVRLQFUHDVLQJWKHYROXPHRIWKHFXOWXUH IHGEDWFK 
E ,QWHUPLWWHQWO\E\UHSODFLQJDFRQVWDQWIUDFWLRQRIWKHFXOWXUHZLWKDQHTXDOYROXPHRI
IUHVK PHGLXP VHPLFRQWLQXRXV EDWFK  $OO EDWFK FXOWXUH V\VWHPV UHWDLQ WKH
DFFXPXODWLQJZDVWHSURGXFWVWRVRPHGHJUHHDQGKDYHDIOXFWXDWLQJHQYLURQPHQW$OO
DUHVXLWDEOHIRUERWKPRQROD\HUDQGVXVSHQVLRQFHOOV
F 3HUIXVLRQE\WKHFRQWLQXRXVDGGLWLRQRIPHGLXPWRWKHFXOWXUHDQGWKHZLWKGUDZDORI
DQ HTXDO YROXPH RI XVHG FHOOIUHH  PHGLXP 3HUIXVLRQ FDQ EH RSHQ ZLWK FRPSOHWH
UHPRYDO RI PHGLXP IURP WKH V\VWHP RU FORVHG ZLWK UHFLUFXODWLRQ RI WKH PHGLXP
XVXDOO\YLDDVHFRQGDU\ YHVVHOEDFNLQWRWKHFXOWXUHYHVVHO7KHVHFRQGDU\YHVVHOLV
XVHGWRUHJHQHUDWHWKHPHGLXPE\JDVVLQJDQGS+FRUUHFWLRQ
G &RQWLQXRXVIORZ FXOWXUH ZKLFK JLYHV WUXH KRPHRVWDWLF FRQGLWLRQV ZLWK QR
IOXFWXDWLRQV RI QXWULHQWV PHWDEROLWHV RU FHOO QXPEHUV ,W GHSHQGV XSRQ PHGLXP
HQWHULQJWKHFXOWXUHZLWKDFRUUHVSRQGLQJZLWKGUDZDORIPHGLXPSOXVFHOOV,WLVWKXV
RQO\ VXLWDEOH IRU VXVSHQVLRQ FXOWXUH FHOOV RU PRQROD\HU FHOOV JURZLQJ RQ
PLFURFDUULHUV

&RPSDULVRQRIEDWFKSHUIXVLRQDQGFRQWLQXRXVIORZFXOWXUH

&RQWLQXRXVIORZ FXOWXUH LV WKH RQO\ V\VWHP LQ ZKLFK WKH FHOOXODU FRQWHQW LV
KRPRJHQHRXVDQGFDQEHNHSWKRPRJHQHRXVIRUORQJSHULRGVRIWLPH PRQWKV 7KLVFDQEH
YLWDO IRU SK\VLRORJLFDO VWXGLHV EXW PD\ QRW EH WKH PRVW HFRQRPLFDO PHWKRG IRU SURGXFW
JHQHUDWLRQ3URGXFWLRQHFRQRPLFVDUHFDOFXODWHGLQWHUPVRIVWDIIWLPHPHGLXPHTXLSPHQW
DQG GRZQVWUHDP SURFHVVLQJ FRVWV $OVR WDNHQ LQWR DFFRXQW DUH WKH FRPSOH[LW\ DQG
VRSKLVWLFDWLRQRI WKHHTXLSPHQWDQG SURFHVVDV WKLV DIIHFWV WKH FDOLEUH RI WKH VWDII UHTXLUHG
DQG WKH UHOLDELOLW\ RI WKH SURGXFWLRQSURFHVV %DWFK FXOWXUH LVPRUH H[SHQVLYH RQ VWDII WLPH
DQG FXOWXUH LQJUHGLHQWV EHFDXVH IRU HYHU\ VLQJOH KDUYHVW D VHTXHQFH RI LQRFXOXP EXLOGXS
VWHSV DQG WKHQ JURZWK LQ WKH ILQDO YHVVHO KDV WR EH FDUULHG RXW DQG WKHUH LV DOVR GRZQWLPH
ZKLOVW WKH FXOWXUH LV SUHSDUHG IRU LWV QH[W UXQ )HHGLQJ URXWLQHV IRU EDWFK FXOWXUHV FDQ JLYH
UHSHDWHGEXWVPDOOHUKDUYHVWVDQGWKHORQJHUDFXOWXUHFDQEHPDLQWDLQHGLQDSURGXFWLYHVWDWH
WKHQWKHPRUHHFRQRPLFDOWKHZKROHSURFHVVEHFRPHV )LJXUH 


ϱϲ

 

)LJXUH&RPSDULVRQRIFXOWXUHSURFHVVHV



7KHQXPEHUVDUHH[SODLQHGLQWKHWDEOHEHORZ
&HOO 3URGXFW\LHOGSHUOLWUH
&XOWXUHW\SH QR PLOOLRQV  PJZHHN  PJPRQWK 
%DWFK   
6HPLFRQWLQXRXVEDWFK   
)HGEDWFK   
&RQWLQXRXVSHUIXVLRQ   
&RQWLQXRXVIORZ   
9DOXHVDOORZIRUWXUQDURXQGWLPHRIQRQFRQWLQXRXVFXOWXUHV

&RQWLQXRXVIORZ FXOWXUH LQ WKH FKHPRVWDW LPSOLHV WKDW FHOO \LHOGV DUH QHYHU PD[LPDO
EHFDXVH D OLPLWLQJ JURZWK IDFWRU LV XVHG WR FRQWURO WKH JURZWK UDWH ,I PD[LPXP \LHOGVDUH
GHVLUHGLQWKLVW\SHRIFXOWXUHWKHQWKHWXUELGRVWDWRSWLRQKDVWREHXVHG6RPHDSSOLFDWLRQV
VXFK DV WKH SURGXFWLRQ RI D F\WRSDWKLF YLUXV OHDYH QR FKRLFH RWKHU WKDQ EDWFK FXOWXUH
0DLQWHQDQFH RI KLJK \LHOGV DQGWKHUHIRUH KLJK SURGXFW FRQFHQWUDWLRQ PD\ EH QHFHVVDU\ WR
UHGXFH GRZQVWUHDP SURFHVVLQJ FRVWV DQG WKHVH FRXOG RXWZHLJK PHGLXP H[SHQVHV )RU WKLV
SXUSRVHSHUIXVLRQKDVWREHXVHG$OWKRXJKIRUPDQ\SURFHVVHVWKLVLVPRUHHFRQRPLFDOWKDQ
EDWFKFXOWXUHLWGRHVDGGWRWKHFRPSOH[LW\RIWKHHTXLSPHQWDQGSURFHVVDQGLQFUHDVHVWKH
ULVNRIDPHFKDQLFDORUHOHFWULFDOIDLOXUHRUPLFURELDOFRQWDPLQDWLRQSUHPDWXUHO\HQGLQJWKH
SURGXFWLRQUXQ7KHUHLVQRFOHDUFXWDQVZHUWRZKLFKW\SHRIFXOWXUHSURFHVVVKRXOGEHXVHG
LW GHSHQGV XSRQ WKH FHOO DQG SURGXFW WKH TXDQWLW\ RI SURGXFW GRZQVWUHDP SURFHVVLQJ
SUREOHPV DQG SURGXFW OLFHQVLQJ UHJXODWLRQV EDWFK GHILQLWLRQ RI SURGXFW FHOO VWDELOLW\ DQG
JHQHUDWLRQ QXPEHU  +RZHYHU D UHODWLYH UDWLR RI XQLW FRVWV IRU SHUIXVLRQ FRQWLQXRXVIORZ
DQGEDWFKFXOWXUHLQWKHSURGXFWLRQRIPRQRFORQDODQWLERG\LV

6XPPDU\RIIDFWRUVOLPLWLQJVFDOHXS

$SDUWIURPVFDOHDQGGLIIHUHQWJURZWKFKDUDFWHULVWLFVRIFHOOVLVWKHUDQJHRIVROXWLRQV
ZKLFKKDYHEHHQXVHGWRRYHUFRPHOLPLWDWLRQVWRVFDOHXS7KHVHZLOOEHEULHIO\UHYLHZHGVR
WKDW WKH XQGHUO\LQJ SKLORVRSK\ DQG HYROXWLRQ RI WKH FXOWXUH V\VWHPV $V DOUHDG\ H[SODLQHG
R[\JHQ LV WKH ILUVW OLPLWLQJ IDFWRU HQFRXQWHUHG LQ VFDOHXS 7R RYHUFRPH WKLV UHDFWRUV DUH

ϱϳ

DYDLODEOH ZLWK PHPEUDQH RU KROORZ ILEUH GHYLFHV WR JLYH EXEEOHIUHH DHUDWLRQ RIWHQ E\
H[WHUQDO PHGLXP ORRSV $ UHODWHG IDFWRU LV PL[LQJ DQG ORZVKHDU RSWLRQV VXFK DV DLUOLIW
UHDFWRUV DQG VSHFLDOO\ GHVLJQHG LPSHOOHUV KDYH EHHQ GHYHORSHG )RU DQFKRUDJHGHSHQGHQW
FHOOV WKH ORZ XQLW VXUIDFH DUHD KDV OLPLWHG HIIHFWLYH VFDOHXS VR D UDQJH RI GHYLFHV XVLQJ
SODWHVVSLUDOVFHUDPLFVDQGPRVWHIIHFWLYHRIDOOPLFURFDUULHUVFDQEHXVHG

7KHQH[WSUREOHPWREHRYHUFRPHLVQXWULHQWOLPLWDWLRQDQGWR[LFPHWDEROLWHEXLOGXS
7KH PRVW HIIHFWLYH VROXWLRQ LV WR XVH SHUIXVLRQ E\ VSLQ ILOWHUV RU KROORZ ILEUH ORRSV 7R
PD[LPL]HWKHEHQHILWRISHUIXVLRQLPPRELOL]DWLRQRIVXVSHQVLRQFHOOVZDVQHHGHGWRSUHYHQW
FHOO ZDVKRXW DQG WKLV UHVXOWHG LQ D FROOHFWLRQ RI QRYHO V\VWHPV EDVHG RQ KROORZ ILEUHV
PHPEUDQHV HQFDSVXODWLRQ DQG VSHFLDOL]HG PDWULFHV ,PPRELOL]DWLRQ KDV PDQ\ SURFHVV
DGYDQWDJHVDQGFXUUHQWO\WKHHIIRUWLVRQVFDOLQJXSVXLWDEOHHQWUDSPHQWPDWULFHVLQIOXLGL]HG
DQGIL[HGEHGV


0RQROD\HUFXOWXUH
,QWURGXFWLRQ

7LVVXH FXOWXUH IODVNV DQG WXEHV JLYLQJ VXUIDFH DUHDV RI  FP  DUH IDPLOLDU WR DOO
WLVVXHFXOWXULVWV7KHODUJHVWVWDWLRQDU\IODVNURXWLQHO\XVHGLQODERUDWRULHVLVWKH5RX[ERWWOH
RUGLVSRVDEOHSODVWLFHTXLYDOHQW ZKLFKJLYHVDVXUIDFHDUHDIRUFHOODWWDFKPHQW RI
FP GHSHQGLQJXSRQW\SH QHHGVPOPHGLXPDQGXWLOL]HVFPRIVWRUDJH
VSDFH7KLVYHVVHOZLOO\LHOG[GLSORLGFHOOVDQGXSWRKHWHURSORLGFHOOV,IRQHKDVWR
SURGXFH IRU H[DPSOH  FHOOV WKHQ RYHU  UHSOLFDWH FXOWXUHV DUH QHHGHG LH
PDQLSXODWLRQV KDYH WR EH UHSHDWHG  WLPHV  ,Q DGGLWLRQ WKH FXELF FDSDFLW\ RI LQFXEDWRU
VSDFHQHHGHGLVRYHUOLWUHV&OHDUO\WKHUHFRPHVDWLPHLQWKHVFDOHXSRIFHOOSURGXFWLRQ
ZKHQRQHKDVWRXVHDPRUHHIILFLHQWFXOWXUHV\VWHP6FDOHXSRIDQFKRUDJHGHSHQGHQWFHOOV
UHGXFHV WKH QXPEHU RI FXOWXUHV LV PRUH HIILFLHQW LQ WKH XVH RI VWDII DQG LQFUHDVHV
VLJQLILFDQWO\ WKH VXUIDFH DUHDYROXPH UDWLR 7R GR WKLV D YHU\ ZLGH DQG YHUVDWLOH UDQJH RI
WLVVXH FXOWXUH YHVVHOV DQG V\VWHPV KDV EHHQ GHYHORSHG 0DQ\ RI WKHVH DUH VKRZQ
GLDJUDPPDWLFDOO\ LQ )LJXUH  7KH PHWKRGV ZLWK WKH PRVW SRWHQWLDO DUH WKRVH EDVHG RQ
PRGLILFDWLRQV WR VXVSHQVLRQ FXOWXUH V\VWHPV EHFDXVH WKH\ DOORZ D WUXO\ KRPRJHQHRXV XQLW
SURFHVV ZLWK HQRUPRXV VFDOHXS SRWHQWLDO WR EH XVHG +RZHYHU WKHVH V\VWHPV VKRXOG EH
DWWHPSWHGRQO\LIWLPHDQGUHVRXUFHVDOORZDOHQJWK\GHYHORSPHQWSHULRG




ϱϴ

 
)LJXUH7KHVFDOLQJXSRIFXOWXUHV\VWHPVIRUDQFKRUDJHGHSHQGHQWFHOOV

$OWKRXJKVXVSHQVLRQFXOWXUHLVWKHSUHIHUUHGPHWKRGIRULQFUHDVLQJFDSDFLW\PRQROD\HU
FXOWXUHKDVWKHIROORZLQJDGYDQWDJHV
D ,W LV YHU\ HDV\ WR FKDQJH WKH PHGLXP FRPSOHWHO\ DQG WR ZDVK WKH FHOO VKHHW EHIRUH
DGGLQJ IUHVK PHGLXP 7KLV LV LPSRUWDQW LQ PDQ\ DSSOLFDWLRQV ZKHQ WKH JURZWK LV
FDUULHG RXW LQ RQH VHW RI FRQGLWLRQV DQG SURGXFW JHQHUDWLRQ LQ DQRWKHU $ FRPPRQ
UHTXLUHPHQW RI D PHGLXP FKDQJH LV WKH WUDQVIHU RI FHOOV IURP VHUXP WR VHUXPIUHH
FRQGLWLRQV7KHHIILFLHQF\ RIPHGLXPFKDQJLQJ LQ PRQROD\HUFXOWXUHV LVVXFK WKDW D
WRWDOUHPRYDORIWKHXQZDQWHGFRPSRXQGFDQEHDFKLHYHG
E ,I DUWLILFLDOO\ KLJK FHOO GHQVLWLHV DUH QHHGHG WKHQ WKHVH FDQ EH VXSSRUWHG E\ XVLQJ
SHUIXVLRQWHFKQLTXHV,WLVPXFKHDVLHUWRSHUIXVHPRQROD\HUFXOWXUHVEHFDXVHWKH\DUH
LPPRELOL]HGDQGDILQHILOWHUV\VWHP WRZLWKKROGFHOOV LVQRWUHTXLUHG
F 0DQ\ FHOOV ZLOO H[SUHVV D UHTXLUHG SURGXFW PRUH HIILFLHQWO\ ZKHQ DWWDFKHG WR D
VXEVWUDWH
G 7KHVDPHDSSDUDWXVFDQEHXVHGZLWKGLIIHUHQWPHGLDFHOOUDWLRVZKLFKRIFRXUVHFDQ
EHHDVLO\FKDQJHGGXULQJDQH[SHULPHQW
H 0RQROD\HUFXOWXUHVDUHPRUHIOH[LEOHEHFDXVHWKH\FDQEHXVHGIRUDOOFHOOW\SHV,ID
YDULHW\ RI FHOO W\SHV DUH WR EH XVHG WKHQ D PRQROD\HU V\VWHP PLJKW EH D EHWWHU
LQYHVWPHQW ,W VKRXOG EH QRWHG WKDW WKH PLFURFDUULHU V\VWHP FRQIHUV VRPH RI WKH
DGYDQWDJHVRIDVXVSHQVLRQFXOWXUHV\VWHP

7KHUHDUHIRXUPDLQGLVDGYDQWDJHVRIPRQROD\HUFRPSDUHGWRVXVSHQVLRQV\VWHPV
 7KH\DUHGLIILFXOWDQGH[SHQVLYHWRVFDOHXS
 7KH\UHTXLUHIDUPRUHVSDFH

ϱϵ

  &HOOJURZWKFDQQRWEHPRQLWRUHGDVHIIHFWLYHO\EHFDXVHRIWKHGLIILFXOW\RIVDPSOLQJ
DQGFRXQWLQJDQDOLTXRWRIFHOOV
 ,WLVPRUHGLIILFXOWWRPHDVXUHDQGFRQWUROSDUDPHWHUVVXFKDVS+DQGR[\JHQDQGWR
DFKLHYHKRPRJHQHLW\

0LFURFDUULHUFXOWXUHHOLPLQDWHVRUDWOHDVWUHGXFHVPDQ\RIWKHVHGLVDGYDQWDJHV

&HOODWWDFKPHQW

$QLPDOFHOOVXUIDFHVDQGWKHWUDGLWLRQDOJODVVDQGSODVWLFFXOWXUHVXUIDFHVDUHQHJDWLYHO\
FKDUJHG VR IRU FHOO DWWDFKPHQW WR RFFXU FURVVOLQNLQJ ZLWK JO\FRSURWHLQV DQGRU GLYDOHQW
FDWLRQV &D0J LVUHTXLUHG7KHJO\FRSURWHLQPRVWVWXGLHGLQWKLVUHVSHFWLVILEURQHFWLQ
D FRPSRXQG RI KLJK PROHFXODU PDVV    V\QWKHVL]HG E\ PDQ\ FHOOV DQG SUHVHQW LQ
VHUXPDQGRWKHUSK\VLRORJLFDOIOXLGV$OWKRXJKFHOOVFDQSUHVXPDEO\ DWWDFKE\HOHFWURVWDWLF
IRUFHV DORQH LW KDV EHHQ IRXQG WKDW WKH PHFKDQLVP RI DWWDFKPHQW LV VLPLODU ZKDWHYHU WKH
VXEVWUDWHFKDUJH7KHLPSRUWDQWIDFWRULVWKHQHWQHJDWLYHFKDUJHDQGVXUIDFHVVXFKDVJODVV
DQG PHWDO ZKLFK KDYH KLJK VXUIDFH HQHUJLHV DUH YHU\ VXLWDEOH IRU FHOO DWWDFKPHQW 2UJDQLF
VXUIDFHV QHHG WR EH ZHWWDEOHDQG QHJDWLYH DQG WKLV FDQ EH DFKLHYHG E\ FKHPLFDO WUHDWPHQW
HJR[LGL]LQJDJHQWVVWURQJDFLGV RUSK\VLFDOWUHDWPHQW HJKLJKYROWDJHGLVFKDUJH89
OLJKW KLJK HQHUJ\ HOHFWURQ ERPEDUGPHQW  2QH RU PRUH RI WKHVH PHWKRGV DUH XVHG E\
PDQXIDFWXUHUVRIWLVVXHFXOWXUHJUDGHSODVWLFV7KHUHVXOWLVWRLQFUHDVHWKHQHWQHJDWLYHFKDUJH
RI WKH VXUIDFH IRU H[DPSOH E\ IRUPLQJ QHJDWLYH FDUER[\O JURXSV  IRU HOHFWURVWDWLF
DWWDFKPHQW

6XUIDFHVPD\DOVREHFRDWHGWRPDNHWKHPVXLWDEOHIRUFHOODWWDFKPHQW$WLVVXHFXOWXUH
JUDGH RI FROODJHQ FDQ EH SXUFKDVHG ZKLFK VDYHV D WHGLRXV SUHSDUDWLRQ SURFHGXUH XVLQJ UDW
WDLOV7KHXVHIXOQHVVRIFROODJHQDVDJURZWKVXUIDFHLVDOVRGHPRQVWUDWHGE\WKHDYDLODELOLW\
RIFROODJHQFRDWHGPLFURFDUULHUEHDGV &\WRGH[3KDUPDFLD 

6XUIDFHVIRUFHOODWWDFKPHQW
L*ODVV

$OXPERURVLOLFDWH JODVV HJ 3\UH[  LV SUHIHUUHG EHFDXVH VRGDOLPH JODVV UHOHDVHV
DONDOLLQWRWKHPHGLXPDQGQHHGVWREHGHWR[LILHG E\ERLOLQJLQZHDNDFLG EHIRUHXVH$IWHU
UHSHDWHG XVH JODVVZDUH FDQ EHFRPH OHVV HIILFLHQW IRU FHOO DWWDFKPHQW EXW HIILFLHQF\ FDQ EH
UHJDLQHG E\ WUHDWPHQW ZLWK  P0 PDJQHVLXPDFHWDWH $IWHU VHYHUDO KRXUV VRDNLQJ DW URRP
WHPSHUDWXUHWKHDFHWDWHLVSRXUHGDZD\DQGWKHJODVVZDUHLVULQVHG ZLWK GLVWLOOHGZDWHU DQG
DXWRFODYHG

LL3ODVWLFV
3RO\VW\UHQH LV WKH PRVW XVHG SODVWLFIRU FHOO FXOWXUHEXW SRO\HWK\OHQH SRO\FDUERQDWH
3HUVSH[ 39& 7HIORQ FHOORSKDQH DQG FHOOXORVH DFHWDWH DUH DOO VXLWDEOH ZKHQ SUHWUHDWHG
FRUUHFWO\

LLL0HWDOV

6WDLQOHVVVWHHODQGWLWDQLXPDUHERWKVXLWDEOHIRUFHOOJURZWKEHFDXVHWKH\DUHUHODWLYHO\
FKHPLFDOO\LQHUWEXWKDYHDVXLWDEOHKLJKQHJDWLYHHQHUJ\7KHUHDUHPDQ\JUDGHVRIVWDLQOHVV
VWHHODQGFDUHKDVWREHWDNHQLQFKRRVLQJWKRVHZKLFKGRQRWOHDNWR[LFPHWDOOLFLRQV7KH
PRVW FRPPRQ JUDGH WR XVH IRU FXOWXUH DSSOLFDWLRQV LV  EXW  DQG  PD\ DOVR EH

ϲϬ

VXLWDEOH 6WDLQOHVV VWHHO VKRXOG EH DFLG ZDVKHG  QLWULF DFLG  K\GURIOXRULFDFLG
ZDWHU WRUHPRYHVXUIDFHLPSXULWLHVDQGLQFOXVLRQVDFTXLUHGGXULQJFXWWLQJ

6FDOLQJXS
6WHSUROOHUERWWOH

7KH DLPV RI VFDOLQJXS DUH WR PD[LPL]H WKH DYDLODEOH VXUIDFH DUHD IRU JURZWK DQG WR
PLQLPL]H WKH YROXPH RI PHGLXP DQG KHDGVSDFH ZKLOH RSWLPL]LQJ FHOO QXPEHUV DQG
SURGXFWLYLW\6WDWLRQDU\FXOWXUHVKDYHRQO\RQHVXUIDFHDYDLODEOHIRUDWWDFKPHQWDQGJURZWK
DQGFRQVHTXHQWO\WKH\QHHGDODUJHPHGLXPYROXPH7KHPHGLXPYROXPHFDQEHUHGXFHGE\
URFNLQJ WKH FXOWXUH RU PRUH XVXDOO\ E\ UROOLQJ D F\OLQGULFDO YHVVHO 7KH UROOHU ERWWOH KDV
QHDUO\DOOLWVLQWHUQDOVXUIDFHDYDLODEOHIRUFHOOJURZWKDOWKRXJKRQO\LVFRYHUHGE\
PHGLXPDWDQ\ RQH WLPH 3ODVWLF GLVSRVDEOH ERWWOHV DUHDYDLODEOH LQ F  FP DQG F 
FP  FP  VL]HV 5RWDWLRQ RI WKH ERWWOH VXEMHFWV WKH FHOOV WR PHGLXP DQG DLU
DOWHUQDWHO\ DV FRPSDUHG ZLWK WKH QHDU DQDHURELF FRQGLWLRQV LQ D VWDWLRQDU\ FXOWXUH 7KLV
PHWKRGUHGXFHVWKHYROXPHRIPHGLXPUHTXLUHGEXWVWLOOUHTXLUHVDFRQVLGHUDEOHKHDGVSDFH
YROXPHWRPDLQWDLQDGHTXDWHR[\JHQDQGS+OHYHOV7KHVFDOHXSRIDUROOHUERWWOHUHTXLUHV
WKDWWKHGLDPHWHULVNHSWDVVPDOODVSRVVLEOH7KHVXUIDFHDUHDFDQEHGRXEOHGE\GRXEOLQJ
WKH GLDPHWHU RU WKH OHQJWK 7KH ILUVW RSWLRQ LQFUHDVHV WKH YROXPH PHGLXP DQG KHDGVSDFH 
IRXUIROGWKHVHFRQGRSWLRQRQO\WZRIROG

7KH RQO\ PHDQV RI LQFUHDVLQJ WKH SURGXFWLYLW\ RI D UROOHU ERWWOH DQG GHFUHDVLQJ LWV
YROXPHLVE\XVLQJDSHUIXVLRQV\VWHP7KLVLVDQH[SHQVLYHRSWLRQDVDQLQWULFDWHUHYROYLQJ
FRQQHFWLRQKDVWREHPDGHIRUWKHVXSSO\OLQHVWRSDVVLQWRWKHERWWOH+RZHYHUFHOO\LHOGVDUH
FRQVLGHUDEO\LQFUHDVHGDQGH[WHQVLYHPXOWLOD\HULQJWDNHVSODFH

6WHSUROOHUERWWOHPRGLILFDWLRQV

7KHUROOHUERWWOHV\VWHPLVVWLOODPXOWLSOHSURFHVVDQGWKXVLQHIILFLHQWLQWHUPVRIVWDII
UHVRXUFHVDQGPDWHULDOV7RLQFUHDVHWKHVXUIDFHDUHDZLWKLQWKHYROXPHRIDUROOHUERWWOHWKH
IROORZLQJYHVVHOVKDYHEHHQGHYHORSHG )LJXUH 

L6SLUD&HO
%LEE\6WHULOLQKDYHUHSODFHGWKHLUEXONFHOOFXOWXUHYHVVHOZLWKD6SLUD&HOUROOHUERWWOH
7KLVLVDYDLODEOHZLWKDVSLUDOSRO\VW\UHQHFDUWULGJHLQWKUHHVL]HVDQGFP
,WLVFUXFLDOWRJHWDQHYHQGLVWULEXWLRQRIWKHFHOOLQRFXOXPVWKURXJKRXWWKHVSLUDORWKHUZLVH
YHU\XQHYHQJURZWKDQGORZ\LHOGVDUHDFKLHYHG&HOOJURZWKFDQEHYLVXDOL]HGRQO\RQWKH
RXWVLGHRIWKHVSLUDODQGWKLVFDQEHPLVOHDGLQJLIWKHFHOOGLVWULEXWLRQLVXQHYHQ

LL*ODVVWXEHV
$VPDOOVFDOHH[DPSOHLVWKH%HOOFR&RUEHLO&XOWXUH6\VWHP %HOOFR $UROOHUERWWOHLV
SDFNHGZLWKDSDUDOOHOFOXVWHURIVPDOOJODVVWXEHV VHSDUDWHGE\VLOLFRQFVSDFHUULQJV 7KUHH
YHUVLRQVDUHDYDLODEOHJLYLQJVXUIDFHDUHDVRI[[DQG[FP0HGLXPLV
SHUIXVHG WKURXJK WKH YHVVHO IURP D UHVHUYRLU 7KH PHWKRG LV LQJHQLRXV LQ WKDW LW DOWHUQDWHO\
URWDWHVWKHERWWOHƒFORFNZLVHDQGWKHQƒDQWLFORFNZLVH7KLVDYRLGVWKHXVHRIVSHFLDO
FDSVIRUWKHVXSSO\RISHUIXVHGPHGLXP$QH[DPSOHRILWVXVHLVWKHSURGXFWLRQRI;
9HURFHOOV ;FP RYHUVL[GD\VXVLQJOLWUHVRIPHGLXP SHUIXVHGDWPOPLQ 
LQWKHFPYHUVLRQ

LLL,QFUHDVHGVXUIDFHDUHDUROOHUERWWOHV

ϲϭ


,QSODFHRIWKHVPRRWKVXUIDFHLQVWDQGDUGUROOHUERWWOHVWKHVXUIDFHLV FRUUXJDWHG WKXV
GRXEOLQJWKHVXUIDFHDUHDZLWKLQWKHVDPHERWWOHGLPHQVLRQVHJH[WHQGHGVXUIDFHDUHDUROOHU
ERWWOH (65% DYDLODEOHIURP%LEE\6WHULOLQ &RUQLQJ RUWKH,PPRED6LOVXUIDFHZKLFKLVD
WH[WXUHGVLOLFRQHUXEEHUPDWUL[VXUIDFH $VKE\6FLHQWLILF/WGRU,QWHJUD%LRVFLHQFHV 

6WHSODUJHFDSDFLW\VWDWLRQDU\FXOWXUHV
L&HOOIDFWRU\ PXOWLWUD\XQLW 

7KH VWDQGDUG FHOO IDFWRU\ XQLW 1XQF  FRPSULVHV WHQ FKDPEHUV HDFK KDYLQJ D VXUIDFH
DUHD RI FPIL[HG WRJHWKHU YHUWLFDOO\ DQG VXSSOLHG ZLWK LQWHUFRQQHFWLQJ FKDQQHOV 7KLV
HQDEOHVDOORSHUDWLRQVWREHFDUULHGRXWRQFHRQO\IRUDOOFKDPEHUV,WFDQWKXVEHWKRXJKWRI
DVDIODVNZLWKDFPVXUIDFHDUHDXVLQJOLWUHVRIPHGLXPDQGWDNLQJXSDWRWDOYROXPH
RIPO,QSUDFWLFHWKLVXQLWLVFRQYHQLHQWWRXVHDQGSURGXFHVJRRGUHVXOWVVLPLODUWR
SODVWLF IODVNV ,W LV PDGH RI WLVVXH FXOWXUH JUDGH SRO\VW\UHQH DQG LV GLVSRVDEOH 2QH RI WKH
GLVDGYDQWDJHVRIWKHV\VWHPFDQEHWXUQHGWRJRRGXVH,QSUDFWLFHLWLVGLIILFXOWWRZDVKRXW
DOOWKHFHOOV DIWHU KDUYHVWLQJ ZLWK WU\SVLQ HWF +RZHYHU HQRXJK FHOOV UHPDLQ WR LQRFXODWHD
QHZFXOWXUHZKHQIUHVKPHGLXPLVDGGHG*LYHQJRRGDVHSWLFWHFKQLTXHWKLVGLVSRVDEOHXQLW
FDQ EH XVHG UHSHDWHGO\ 7KH V\VWHP LV XVHG FRPPHUFLDOO\ IRU LQWHUIHURQ SURGXFWLRQ E\
OLQNLQJWRJHWKHUPXOWLSOHVRIWKHVHXQLWV ,QDGGLWLRQXQLWVDUHDYDLODEOHJLYLQJ WUD\ 
DQGFP WUD\ 

LL&RVWDU&HOO&XEH

7KH&HOO&XEHKDVSDUDOOHOSRO\VW\UHQHWUD\VLQDPRGXODUFORVHGORRSSHUIXVLRQV\VWHP
ZLWK DQ R[\JHQDWRU SXPSV DQG D V\VWHP FRQWUROOHU S+ 2 OHYHO FRQWURO  7KH XQLW LV
FRPSDFWZLWKWKHWUD\VEHLQJ RQO\  PP DSDUWWKXV WKHVPDOOHVWXQLW RIFPLVOHVV
WKDQ  OLWUHV WRWDO YROXPH  OLWUHV PHGLXP  $GGLWLRQDO XQLWV RI  FP  OLWUHV
PHGLXP DQGFP OLWUHVPHGLXP DUHDYDLODEOHDQGIRXUXQLWVFDQEHUXQLQSDUDOOHO
JLYLQJFPJURZWKDUHD

LLL+ROORZILEUHFXOWXUH

%XQGOHVRIV\QWKHWLFKROORZILEUHVRIIHUDPDWUL[DQDORJRXVWRWKHYDVFXODUV\VWHPDQG
DOORZFHOOVWR JURZLQWLVVXHOLNH GHQVLWLHV +ROORZ ILEUHVDUH XVXDOO\XVHGLQXOWUDILOWUDWLRQ
VHOHFWLYHO\DOORZLQJSDVVDJHRIPDFURPROHFXOHVWKURXJKWKHVSRQJ\ILEUHZDOOZKLOHDOORZLQJ
DFRQWLQXRXVIORZRIOLTXLGWKURXJKWKHOXPHQ:KHQWKHVHILEUHVDUHHQFORVHGLQDFDUWULGJH
DQGHQFDSVXODWHGDWERWKHQGVPHGLXPFDQEHSXPSHGLQDQGZLOOWKHQSHUIXVHWKURXJKWKH
ILEUH ZDOOV ZKLFK SURYLGH D ODUJH VXUIDFH DUHD IRU FHOO DWWDFKPHQW DQG JURZWK &XOWXUH
FKDPEHUVEDVHGRQWKLVSULQFLSOHDUHDYDLODEOHIURP$PLFRQ7KHFDSLOODU\ILEUHVZKLFKDUH
PDGHRIDFU\OLFSRO\PHUDUHXPLQGLDPHWHUVZLWKXPZDOOV7KHSRUHVWKURXJKWKH
LQWHUQDOOXPHQOLQLQJDUHDYDLODEOHZLWKPROHFXODUPDVVFXWRIIVEHWZHHQDQG
,WLVGLIILFXOWWRFDOFXODWHWKHWRWDOVXUIDFHDUHDDYDLODEOHIRUJURZWKEXWXQLWVDUHDYDLODEOHLQ
YDULRXVVL]HVDQGWKHVHJLYHDYHU\KLJKUDWLRRIVXUIDFHDUHDWRFXOWXUHYROXPH LQWKHUHJLRQ
RI  FPPO  8SWR  FHOOVPO KDV EHHQ PDLQWDLQHG LQ WKLV V\VWHP 7KHVH FXOWXUHV DUH
PDLQO\XVHGIRUVXVSHQVLRQFHOOVEXWDUHVXLWDEOHIRUDWWDFKHGFHOOVLIWKHSRO\VXOIRQHW\SHLV
XVHG




ϲϮ

LY2SWLFHOOFXOWXUHV\VWHP

7KLV V\VWHP &HOOH[ %LRVFLHQFHV ,QF  FRQVLVWV RI D F\OLQGULFDO FHUDPLF FDUWULGJH
DYDLODEOH LQ VXUIDFH DUHD EHWZHHQ  P  ZLWK  PP VTXDUH FKDQQHOV UXQQLQJ
OHQJWKZD\VWKURXJKWKHXQLW$PHGLXPSHUIXVLRQORRSWRDUHVHUYRLULQZKLFKHQYLURQPHQWDO
FRQWURO LV FDUULHG RXW FRPSOHWHV WKH V\VWHP ,W SURYLGHV D ODUJH VXUIDFH DUHDYROXPH UDWLR
 DQGLWVVXLWDELOLW\IRUYLUXVFHOOVXUIDFHDQWLJHQDQGPRQRFORQDODQWLERG\SURGXFWLRQ
LVGRFXPHQWHG6FDOHXSWRPLVSRVVLEOHZLWKPXOWLSOHFDUWULGJHVDUUDQJHGLQSDUDOOHOLQ
DVLQJOHFRQWUROOHGXQLW&DUWULGJHVDUHDYDLODEOHIRUERWKDWWDFKHGDQGVXVSHQVLRQFHOOVZKLFK
EHFRPHHQWUDSSHGLQWKHURXJKSRURXVFHUDPLFWH[WXUH

Y+HOL&HO %LEE\6WHULOLQ 

7ZLVWHG KHOLFDO ULEERQV RI SRO\VW\UHQH  PP [  PP [  XP  DUH XVHG DV
SDFNLQJ PDWHULDO IRU WKH FXOWLYDWLRQ RI DQFKRUDJHGHSHQGHQW FHOOV 0HGLXP LV FLUFXODWHG
WKURXJK WKH EHG E\ D SXPS DQG WKH KHOLFDO VKDSH SURYLGHV JRRG K\GURG\QDPLF IORZ 7KH
ULEERQVDUHWUDQVSDUHQWDQGWKHUHIRUHDOORZFHOOH[DPLQDWLRQDIWHUUHPRYDOIURPWKHEHG

6WHSXQLWSURFHVVV\VWHPV
7KHUH DUH EDVLFDOO\ WKUHH V\VWHPV ZKLFK ILW LQWR IHUPHQWDWLRQ VXVSHQVLRQ FXOWXUH 
DSSDUDWXV )LJXUH 

x FHOOVVWDWLRQDU\PHGLXPPRYHV HJJODVVEHDGUHDFWRU 
x KHWHURJHQHRXVPL[LQJ HJVWDFNSODWHUHDFWRU 
x KRPRJHQHRXVPL[LQJ HJPLFURFDUULHU 

L%HDGEHGUHDFWRU

7KHXVHRIDSDFNHGEHGRIPPJODVVEHDGVWKURXJKZKLFKPHGLXPLVFRQWLQXDOO\
SHUIXVHG KDV EHHQ UHSRUWHG E\ D QXPEHU RI LQYHVWLJDWRUV VLQFH  7KH SRWHQWLDO RI WKH
V\VWHP IRU VFDOHXS XVHV D  OLWUH FDSDFLW\ V\VWHP IRU WKH JURZWK RI %+. FHOOV DQG
V\VWHPVFDQEHFRPPHUFLDOO\REWDLQHG 0HUHGRV*PE+ 





ϲϯ

 

)LJXUH  $JODVV EHDGELRUHDFWRU $ *ODVV EHDG EHG %  UHVHUYRLU &  SXPS ' 
LQRFXODWLRQDQGKDUYHVWOLQH ( WHPSHUDWXUHFRQWUROOHGZDWHUMDFNHWV

6SKHUHV RI  PP GLDPHWHU SDFN VXIILFLHQWO\ WLJKWO\ WR SUHYHQW WKH SDFNHG EHG IURP
VKLIWLQJ EXW DOORZ VXIILFLHQW IORZ RI PHGLXP WKURXJK WKH FROXPQ VR WKDW IDVW IORZ UDWHV
ZKLFK ZRXOG FDXVH PHFKDQLFDO VKHDU GDPDJH DUH QRW QHHGHG 7KH SK\VLFDO SURSHUWLHV RI
JODVVVSKHUHVDUHJLYHQLQ7DEOHDQGWKHVHGDWDDOORZWKHQHFHVVDU\FXOWXUHSDUDPHWHUVWREH
FDOFXODWHG $ V\VWHP ZKLFK FDQ EH FRQVWUXFWHG LQ WKH ODERUDWRU\ LV LOOXVWUDWHG LQ )LJXUH 
0HGLXPLVWUDQVIHUUHGE\ D SHULVWDOWLF SXPSLQ WKLVH[DPSOH EXWDQDLUOLIWGULYHQV\VWHP LV
DOVR VXLWDEOH DQG JLYHV EHWWHU R[\JHQDWLRQ 0HGLXP FDQ EH SDVVHG HLWKHU XS RU GRZQ WKH
FROXPQZLWKQRDSSDUHQWGLIIHUHQFHLQUHVXOWV
7DEOH3URSHUWLHVRIPPDQGPPJODVVEHDGV
*ODVVVSKHUHGLDPHWHU PP PP
:HLJKWJ  
6XUIDFHDUHD FPNJ   
9ROXPH PONJ   
9RLGIUDFWLRQ  
9RLGYROXPH PONJ   
&KDQQHOVL]H PP   
9HURFHOO\LHOGV
FP  
NJ  
PO  
‡<LHOGLQNJNJEHGUHDFWRU
$OWKRXJKPPEHDGVDUFQRUPDOO\XVHGWRPD[LPL]HWKHDYDLODEOHVXUIDFHDUHDWKHXVH
RIPPVSKHUHVDFWXDOO\ JLYHVDKLJKHUWRWDOWHOO\LHOGGHVSLWHWKHUHGXFHGVXUIDFHDUHDSHU
XQLWYROXPH$GHYHORSPHQWRIWKLVV\VWHP SRURXVEHDGV ZKLFKVLJQLILFDQWO\LQFUHDVHVFHOO
\LHOGV

ϲϰ

LL+HWHURJHQHRXVUHDFWRU

&LUFXODU JODVV RU VWDLQOHVVVWHHO SODWHVDUH ILWWHGYHUWLFDOO\PPDSDUWRQDFHQWUDO
VKDIW 7KLV VKDIW PD\ EH VWDWLRQDU\ ZLWK DQ DLUOLIW SXPS IRU PL[LQJ RU UHYROYLQJ DURXQG D
YHUWLFDO  USK  RU KRUL]RQWDO  USP  D[LV 7KLV PXOWLVXUIDFH SURSDJDWRU   ZDV
XVHG DW VL]HV UDQJLQJ IURP  OLWUHV JLYLQJ D VXUIDFH DUHD RI XS WR  [ FP 7KH
DXWKRU VH[SHULHQFHLVVROHO\ZLWKWKHKRUL]RQWDOVWLUUHGSODWHW\SHRIYHVVHO )LJXUHVWDFN
SODWH ZKLFKLVHDVLHUWRXVHDQGKDVEHHQVXFFHVVIXOIRUERWKKHWHURSORLGDQGKXPDQGLSORLG
FHOOV7KHPDLQGLVDGYDQWDJHZLWKWKLVW\SHRIFXOWXUHLVWKHKLJKUDWLRRIPHGLXPYROXPHWR
VXUIDFHDUHD POWRFP 7KLVFDQQRWEHDOWHUHGZLWKWKHKRUL]RQWDOW\SHVDOWKRXJKLW
FDQEHKDOYHGZLWKWKHYHUWLFDOO\UHYROYLQJGLVFV

LLL+RPRJHQHRXVV\VWHPV PLFURFDUULHU 

:KHQFHOOV DUH JURZQ RQ VPDOO VSKHULFDO FDUULHUV WKH\FDQ EH WUHDWHG DVD VXVSHQVLRQ
FXOWXUHDQGDGYDQFHGIHUPHQWDWLRQWHFKQRORJ\SURFHVVHVDQGDSSDUDWXVFDQEHXWLOL]HG7KH
PHWKRG XVHV GH[WUDQ EHDGV 6HSKDGH[ $  7KHVH ZHUH QRW HQWLUHO\ VDWLVIDFWRU\ EHFDXVH
WKH FKDUJH RI WKH EHDGV ZDV XQVXLWDEOH DQG SRVVLEO\ GXH WR WR[LF HIIHFWV +RZHYHU PXFK
GHYHORSPHQWDO ZRUN KDV VLQFH UHVXOWHG LQ PDQ\ VXLWDEOH PLFURFDUULHUV EHLQJ FRPPHUFLDOO\
DYDLODEOH 7DEOH   7KH FKRLFH RI WKLV PLFURFDUULHU ZDV EDVHG RQ D SUHIHUHQFH IRU D GULHG
SURGXFWZKLFKFRXOGEHDFFXUDWHO\ZHLJKHGDQGWKHQSUHSDUHGLQVLWXDQGWKHIDFWWKDWZLWKD
GHQVLW\RIRQO\JPOWKLVSURGXFWFRXOGEHXVHGDWFRQFHQWUDWLRQVRIXSWRJOLWUH 
 FPOLWUH  +RZHYHU WKLV SUHIHUHQFH GRHV QRW GHWUDFW IURP WKH TXDOLW\ RI RWKHU
PLFURFDUULHUVPRVWRIZKLFKKDYHEHHQXVHGZLWKHTXDOVXFFHVV

&XOWXUHDSSDUDWXV

$ VSLQQHU YHVVHO LV QRW VXLWDEOH XQOHVV WKH VWLUULQJ V\VWHP LV PRGLILHG 3DGGOHV ZLWK
ODUJHVXUIDFHDUHDDUHQHHGHG7KHVHDUHFRPPHUFLDOO\DYDLODEOHEXWFDQEHHDVLO\FRQVWUXFWHG
RXWRIDVLOLFRQHUXEEHUVKHHWDQGDWWDFKHGWRWKHPDJQHWZLWKSODVWLFWLHV7KHDGYDQWDJHRI
FRQVWUXFWLQJRQHZLWKLQWKHODERUDWRU\LVWKDWWKHEODGHVFDQEHPDGHWRLQFOLQHƒIURP
WKH YHUWLFDO WKXV JLYLQJ PXFK JUHDWHU OLIW DQG PL[LQJ WKDQ YHUWLFDO EODGHV )LJXUH  
0LFURFDUULHUFXOWXUHVDUHVWLUUHGYHU\VORZO\ PD[LPXPUSP DQGLWLVHVVHQWLDOWRKDYHD
JRRGTXDOLW\PDJQHWLFVWLUUHUWKDWLVFDSDEOHRIJLYLQJDVPRRWKVWLUULQJDFWLRQLQWKHUDQJHRI
USP1HYHUXVHDVWLUUHUPHFKDQLVPWKDWKDVPRYLQJVXUIDFHVLQFRQWDFWZLWKHDFK
RWKHU LQ WKH PHGLXP RWKHUZLVH WKH PLFURFDUULHUV ZLOO EH FUXVKHG 7KXV VWLUUHUV ZKLFK
UHYROYHRQWKHERWWRPRIWKHYHVVHODUHXQVXLWDEOH$VPL[LQJDQGWKXVPDVVWUDQVIHULVVR
SRRULQWKHVHFXOWXUHV WKHGHSWKRIPHGLXPVKRXOGQRWH[FHHGWKHGLDPHWHUE\PRUHWKDQD
IDFWRURIWZRXQOHVVR[\JHQDWLRQV\VWHPVRUUHJXODUPHGLXPFKDQJHVDUHSHUIRUPHG,QWKH
EDVLF FXOWXUH V\VWHPV PHGLXP FKDQJHV KDYH WR EH FDUULHG RXW DW IUHTXHQW LQWHUYDOV ,W LV
ZRUWKZKLOHWKHUHIRUHWRPDNHVXLWDEOHFRQQHFWLRQVWRWKHFXOWXUHYHVVHOWRHQDEOHWKLVWREH
GRQHFRQYHQLHQWO\LQVLWX7KLVZLOOSD\GLYLGHQGVLQUHGXFLQJWKHFKDQFHVRIFRQWDPLQDWLQJ
WKHFXOWXUH$VLPSOLILHGFXOWXUHVHWXSLVVKRZQLQ)LJXUH








ϲϱ

 7DEOH&RPSDULVRQRIPLFURFDUULHUV
0DQXIDFWXUHU 6SHFLILF
7UDGHQDPH JUDYLW\ 0DWHULDO XUQ  FPJ  'LDPHWHU $UHD
%LRVLORQ 1XQF 3RO\VW\UHQH   
%LRJODV 6RORKLOO(QJ *ODVVD   
%LRSODV 6RORKLOO(QJ 3RO\VW\UHQHD   
D
%LRVSKHUHV 6RORKLOO(QJ &ROODJHQ    
'($(
&\WRGH[ 3KDUPDFLD 6HSKDGH[   
'($(
&\WRGH[ 3KDUPDFLD 6HSKDGH[   
&\WRGH[ 3KDUPDFLD &ROODJHQ   
&\WRVSKHUH /X[ 3RO\VW\UHQH   
'RUPDFHOO 3IHLIHU /DQJHQ 'H[WUDQ   
'( :KDWPDQ &HOOXORVH  )LEUHV 
*HOLEHDG +D]HOWRQ/DE *HODWLQ   
0LFURGH[ 'H[WUDQ3URG '($(GH[WUDQ   
9HQWUHJODV 9HQWUH[ *ODVV   
9HQWUHJHO 9HQWUH[ *HODWLQ   

%LRVSKHUHV JODVV SODVWLF FROODJHQ  DYDLODEOH DW VSHFLILF JUDYLW\ RI  RU  DQG
GLDPHWHUV RI  RU  XP PDQXIDFWXUHG E\ 6RORKLOO (QJ DQG GLVWULEXWHG E\
:KDWPDQDQG&HOORQ 





)LJXUH  7\SHV RI LPSHOOHUV IRU JURZLQJ VXVSHQVLRQ DQG PLFURFDUULHU FHOOV $  )ODW
GLVFWXUELQH GGO  UDGLDOIORZWXUEXOHQWPL[LQJ % PDULQH LPSHOOHU GGO  
D[LDOIORZWXUEXOHQWPL[LQJ EODGHDQJOHƒ & 9LEURPL[HU '  VWLUUHUEDU GGO  
UDGLDOIORZODPLQDUPL[LQJ (  YHUWLFDODQG )  DQJOHG ƒ  SDGGOHGOG D[LDO
DQGUDGLDOIORZODPLQDUDQGWXUEXOHQWPL[LQJ GLVWKHGLDPHWHURIWKHYHVVHODQGGLVWKH
GLDPHWHURIWKHLPSHOOHU 

ϲϲ

 
)LJXUH$VLPSOHPLFURFDUULHUFXOWXUHV\VWHPDOORZLQJHDV\PHGLXPFKDQJLQJ7RILOO
WKH FXOWXUH &  RSHQ FODPS /  DQG SXVK WKH PHGLXP IURP WKH UHVHUYRLU 5  XVLQJ DLU
SUHVVXUH DW$ 7RKDUYHVWVWRSWKHVWLUULQJIRUPLQRSHQ/DQGSXVKWKHPHGLXPIURP
& WR + XVLQJDLUSUHVVXUH DW%  6 LVDVDPSOLQJSRLQW


,QLWLDWLRQRIWKHFXOWXUH

0DQ\RIWKHIDFWRUVDUHFULWLFDOZKHQLQLWLDWLQJDPLFURFDUULHUFXOWXUH0LFURFDUULHUVDUH
VSKHULFDO DQG FHOOV ZLOO DOZD\V DWWDFK WR DQ DUHD RI PLQLPXP FXUYDWXUH 7KHUHIRUH D
PLFURFDUULHU VXUIDFH FDQ QHYHU EH LGHDO KRZHYHU VXLWDEOH LWV FKHPLFDO DQG SK\VLFDO
SURSHUWLHV(QVXUH WKHPHGLXPDQG EHDGVDUHDWD VWDEOHS+DQGWHPSHUDWXUHDQGLQRFXODWH
WKH FHOOV IURP D ORJDULWKPLF QRW D VWDWLRQDU\ FXOWXUH  LQWR D WKLUG RI WKH ILQDO PHGLXP
YROXPH 7KLV LQFUHDVHV WKH FKDQFHV RI FHOOV FRPLQJ LQWR FRQWDFW ZLWK WKH PLFURFDUULHUV
0LFURFDUULHU FRQFHQWUDWLRQV RI  JOLWUH VKRXOG EH XVHG +LJKHU FRQFHQWUDWLRQV QHHG
HQYLURQPHQWDOFRQWURORUYHU\IUHTXHQWPHGLXPFKDQJHV

$IWHUWKHDWWDFKPHQWSHULRG K VORZO\WRS XS WKH FXOWXUH WR WKHZRUNLQJ YROXPH
DQGLQFUHDVHWKHVWLUULQJUDWHWRPDLQWDLQFRPSOHWHO\KRPRJHQHRXVPL[LQJ,IWKHVHFRQGLWLRQV
DUHDGKHUHGWRDQGWKHUHDUHQRFKDQJHVLQWHPSHUDWXUHDQGS+ WKHQDOOFHOOVWKDWJURZRQ
SODVWLFVXUIDFHVVKRXOGUHDGLO\LQLWLDWHDPLFURFDUULHUFXOWXUH


0DLQWHQDQFHRIWKHFXOWXUH

,WLVYHU\HDV\WRPRQLWRUWKHSURJUHVVRIFHOOJURZWKLQDPLFURFDUULHUFXOWXUH6DPSOHV
FDQEHHDVLO\ UHPRYHGFHOO FRXQWV E\ QXFOHLFRXQWLQJ  DQG JOXFRVH GHWHUPLQDWLRQV FDUULHG
RXWDQGWKHFHOOPRUSKRORJ\H[DPLQHG$VWKHFHOOVJURZVRWKHEHDGVEHFRPHKHDYLHUDQG
QHHGDQLQFUHDVHGVWLUULQJUDWH$IWHUWKUHHGD\VRUVRWKHFXOWXUHZLOOEHFRPHDFLGLFDQGQHHG
D PHGLXP FKDQJH $JDLQ WKLV LV DQ H[WUHPHO\ HDV\ URXWLQH WXUQ RII WKH VWLUUHU DOORZ WKH
EHDGVWRVHWWOHIRUPLQDQGGHFDQWRIIDVPXFKPHGLXPDVGHVLUHG7RSXSJHQWO\ZLWKIUHVK
PHGLXP SUHZDUPHGWRƒ& DQGUHVWDUWWKHVWLUULQJ



ϲϳ

+DUYHVWLQJ
,WLVYHU\GLIILFXOWWRKDUYHVWPDQ\FHOOW\SHVIURPPLFURFDUULHUVXQOHVVWKHFHOOGHQVLW\
RQWKHEHDGLVYHU\KLJKDQGFHOOVGRQRWPXOWLOD\HURQPLFURFDUULHUVWRWKHVDPHGHJUHHDVLQ
VWDWLRQDU\ FXOWXUHV +DUYHVWLQJ FDQ EH DWWHPSWHG E\ GUDLQLQJ RII WKH PHGLXP ZDVKLQJ WKH
EHDGV DW OHDVW RQFHLQ EXIIHU DQG DGGLQJ WKH GHVLUHG HQ]\PH 6WLU WKHFXOWXUHIDLUO\UDSLGO\
 USP  IRU  PLQ ,I WKH FHOOV GHWDFK D KLJK SURSRUWLRQ FDQ EH FROOHFWHG E\
DOORZLQJWKHEHDGVWRVHWWOHRXWIRUPLQDQGWKHQGHFDQWLQJRIIWKHVXSHUQDWDQW)RUDWRWDO
KDUYHVW SRXUWKHPL[WXUHLQWR D VWHULOL]HG VLQWHUHG JODVV IXQQHO SRURVLW\JUDGH  7KHFHOOV
ZLOOSDVVWKURXJKWKHILOWHUEXWWKHPLFURFDUULHUVZLOOQRW$OWHUQDWLYHO\LQVHUWDVLPLODUILOWHU
XVXDOO\VWDLQOHVVVWHHO LQWRWKHFXOWXUHYHVVHO,IWKHPLFURFDUULHULVGLVVROYHGWKHQWKHFHOOV
FDQEHUHOHDVHGLQWRVXVSHQVLRQFRPSOHWHO\XQGDPDJHGDQGWKHUHIRUHRIEHWWHUTXDOLW\WKDQ
ZKHQ WKH FHOOV DUH WU\SVLQL]HG 8VXDOO\ WKLV LV D WDU TXLFNHU PHWKRG WKDQ WU\SVLQL]DWLRQ RI
FHOOV *HODWLQ EHDGV DUH VROXELOL]HG ZLWK WU\SVLQ DQGRU ('7$ FROODJHQDVH DFWV RQ WKH
FROODJHQFRDWHGEHDGVDQGGH[WUDQDVHFDQEHXVHGRQWKHGH[WUDQPLFURFDUULHUV


6FDOLQJXSRIPLFURFDUULHUFXOWXUH

6FDOLQJXS FDQ EH DFKLHYHG E\ LQFUHDVLQJ WKH PLFURFDUULHU FRQFHQWUDWLRQ RU E\
LQFUHDVLQJWKHFXOWXUHVL]H ,Q WKHILUVW FDVH QXWULHQWV DQG R[\JHQ DUH YHU\UDSLGO\GHSOHWHG
DQG WKH S+ IDOOV WR QRQSK\VLRORJLFDO OHYHOV 0HGLXP FKDQJHV DUH QRW RQO\ WHGLRXV EXW
SURYLGHUDSLGO\FKDQJLQJHQYLURQPHQWDOFRQGLWLRQV3HUIXVLRQHLWKHUWRZDVWHRUE\DFORVHG
ORRS PXVW EH XVHG WR DFKLHYH FXOWXUHV ZLWK KLJK PLFURFDUULHU FRQFHQWUDWLRQ 7KLV FDQ EH
EURXJKW DERXW RQO\ E\ DQ HIILFLHQW ILOWUDWLRQ V\VWHP VR WKDW PHGLXP ZLWKRXW FHOOV DQG
PLFURFDUULHUVFDQEHZLWKGUDZQDWDUDSLGUDWH )LJXUH 7KLVLVFRQVWUXFWHGRI D VWDLQOHVV
VWHHOPHVKZLWKDQDEVROXWHSRUHVL]HLQWKHXPUDQJH$WWDFKPHQWWRWKHVWDUUHUVKDIW
PHDQV WKDWD ODUJHVXUIDFHDUHDILOWHUFDQ EH XVHG DQGWKHUHYROYLQJ DFWLRQ GLVFRXUDJHV FHOO
DWWDFKPHQW DQG FORJJLQJ +RZHYHU VFDOLQJXS LV DFKLHYHG R[\JHQ OLPLWDWLRQ LV WKH FKLHI
IDFWRU WR RYHUFRPH 7KLV LV DQ HVSHFLDOO\ GLIILFXOW SUREOHP LQ PLFURFDUULHU FXOWXUH EHFDXVH
VWLUULQJVSHHGVDUHORZ6SDUJLQJFDQQRWEHXVHGDVPLFURFDUULHUVJHWOHIWDERYHWKHPHGLXP
OHYHOGXHWRWKHIRDPLQJLWFDXVHV7KHSHUIXVLRQILOWHUSUHYLRXVO\GHVFULEHG KRZHYHUGRHV
DOORZVSDUJLQJLQWRWKDWSDUWRIWKHFXOWXUHLQZKLFKQREHDGVDUHSUHVHQW8QIRUWXQDWHO\WKLV
PHDQV WKDW WKH PRVW R[\JHQDWHG PHGLXP LQ WKH FXOWXUH LV UHPRYHG E\ SHUIXVLRQ EXW DW D
VSDUJLQJUDWHRIFP RIR[\JHQOLWUHFRQVLGHUDEOHGLIIXVLRQRIR[\JHQDWHGPHGLXPRFFXUV
LQWR WKH PDLQ FXOWXUH +RZHYHU PRGLILHG VSLQ ILOWHUV DUH DYDLODEOH ZKLFK KDYH D VHSDUDWH
FRPSDUWPHQWIRUSHUIXVLRQDQGVSDUJLQJ7KXVR[\JHQGHOLYHU\WRDPLFURFDUULHUFXOWXUHFDQ
XWLOL]HWKHIROORZLQJV\VWHPV VHHDOVR7DEOH 
, 6XUIDFHDHUDWLRQ
,, ,QFUHDVLQJWKHSHUIXVLRQUDWHRIIXOO\R[\JHQDWHGPHGLXPIURPWKHUHVHUYRLU
,,, 6SDUJLQJLQWRWKHILOWHUFRPSDUWPHQW

7KHVHWKUHHV\VWHPVDUHXVHGE\WKHDXWKRULQWKHV\VWHPLOOXVWUDWHGLQ)LJXUHWRUXQ
FXOWXUHVDWXSWRJOLWUH&\WRGH[LQFXOWXUHYHVVHOVEHWZHHQOLWUHZRUNLQJYROXPHV
$W\SLFDOH[SHULPHQWLVVKRZQLQ)LJXUH

ϲϴ

 
)LJXUH$FORVHGORRSSHUIXVLRQV\VWHPZLWKHQYLURQPHQWDOFRQWUROWRDOORZKLJKFHOO
GHQVLW\PLFURFDUULHUFXOWXUH &8 &XOWXUHYHVVHO 5( UHVHUYRLU & FRQQHFWRUIRUPHGLXP
FKDQJHVDQGKDUYHVWLQJ ) ILOWHU * JDVEOHQGHU / OHYHOFRQWUROOHU 0 VDPSOLQJGHYLFH
P  PDJQHW 1  DONDOL 1D2+  UHVHUYRLU 2(  R[\JHQ HOHFWURGH 3$  SDGGOH 3(  S+
HOHFWURGH 33  SXPSV  PHGLXP WR UHVHUYRLU FRQWLQXRXV   PHGLXP WR FXOWXUH
FRQWUROOHGE\/ DONDOLWRUHVHUYRLU FRQWUROOHGE\3(  5 URWDPHWHUPHDVXULQJJDVIORZ
UDWH VD JDVVXSSO\IRUVXUIDFHDHUDWLRQ VS JDVVXSSO\IRUVSDUJLQJ 6 VROHQRLGYDOYH



)LJXUH  *URZWK RI *3. HSLWKHOLDO FHOOV RQ &\WRGH[  JOLWUH  LQ WKH  OLWUH
FXOWXUHV\VWHPGHVFULEHGLQ)LJXUH RR &HOOFRQFHQWUDWLRQ $$ JOXFRVH JOF XWLOL]HG
S SHUIXVLRQUDWH


ϲϵ

6XPPDU\RIPLFURFDUULHUFXOWXUH

0LFURFDUULHU FXOWXUHV DUH XVHG FRPPHUFLDOO\ IRU YDFFLQH DQG LQWHUIHURQ SURGXFWLRQ LQ
IHUPHQWHUV XS WR  OLWUHV 7KHVH SURFHVVHV XVH KHWHURSORLG RU SULPDU\ FHOOV 2QH RI WKH
SUREOHPV RI XVLQJ YHU\ ODUJH VFDOH FXOWXUHV LV WKDW WKH UHTXLUHG VHHG LQRFXOXP JHWV
SURJUHVVLYHO\ ODUJHU +DUYHVWLQJ RI FHOOV IURP ODUJH XQLW VFDOH FXOWXUHV LV QRW DOZD\V YHU\
VXFFHVVIXODOWKRXJKWKHDYDLODELOLW\RIFROODJHQDQGJHODWLQPLFURFDUULHUVHDVHVWKLVSUREOHP
FRQVLGHUDEO\,QVLWXWU\SVLQL]DWLRQRIFHOOVLVWKHXVXDOPHWKRGRIFKRLFHEXWLWLVGLIILFXOWWR
UHPRYH D KLJK SHUFHQWDJH RI WKH FHOOV LQ D YLDEOH FRQGLWLRQ )LOWHUV LQFRUSRUDWHG LQWR WKH
FXOWXUHYHVVHOSURYLGHWKHEHVWVROXWLRQDQGDUHPRVWHIILFLHQWZLWKWKH KDUG  JODVVSODVWLF 
PLFURFDUULHUVZKLFKGRQRWEORFNWKHILOWHUSRUHVOLNHWKHGH[WUDQDQG JHODWLQ PLFURFDUULHUV
6RPH PLFURFDUULHUV FDQ EH ZDVKHG DQG UHXVHG EXW WKLV RI FRXUVH LV QRW SRVVLEOH ZLWK WKH
JHODWLQRUFROODJHQDVHWUHDWHGEHDGV

6XPPDU\FKRLFHRIHTXLSPHQW

$ ZLGH UDQJH RI FRPPHUFLDOO\ DYDLODEOH DQG ODERUDWRU\PDGH HTXLSPHQW KDV EHHQ
UHYLHZHG7KLVVKRXOGHQDEOHDFKRLFHWREHPDGHGHSHQGLQJXSRQWKHDPRXQWDQGW\SHRI
FHOOVRUSURGXFWQHHGHGDQGWKHILQDQFLDODQGVWDIIUHVRXUFHVDYDLODEOH7RUHYLHZWKHFKRLFHV
DYDLODEOH)LJXUHDQG7DEOHVKRXOGEHFRQVXOWHG

6XVSHQVLRQFXOWXUH

$VLQGLFDWHGSUHYLRXVO\LQWKLVFKDSWHUVXVSHQVLRQFXOWXUHLVWKHSUHIHUUHGPHWKRGIRU
VFDOLQJXSFHOOFXOWXUHV6RPHFHOOVHVSHFLDOO\WKRVHRIKDHPRSRLHWLFGHULYDWLRQJURZEHVWLQ
VXVSHQVLRQ FXOWXUH 2WKHUV SDUWLFXODUO\ WUDQVIRUPHG FHOOV FDQ EH DGDSWHG RU VHOHFWHG EXW
VRPH IRU H[DPSOH KXPDQ GLSORLG FHOO VWUDLQV :± 05&  ZLOO QRW VXUYLYH LQ
VXVSHQVLRQDWDOO$IXUWKHUIDFWRUWKDWGLFWDWHVZKHWKHUVXVSHQVLRQV\VWHPVFDQEHXVHGLVWKDW
VRPHFHOOXODUSURGXFWVDUHH[SUHVVHGRQO\ZKHQWKHFHOOH[LVWVLQ DPRQROD\HURULIFHOOWR
FHOO FRQWDFW LV HVWDEOLVKHG HJ IRU WKH VSUHDG RI LQWUDFHOOXODU YLUXVHV WKURXJK D FHOO
SRSXODWLRQ 

$GDSWDWLRQWRVXVSHQVLRQFXOWXUH

&HOOOLQHVYDU\LQWKHHDVHZLWKZKLFKWKH\FDQEHSHUVXDGHGWRJURZLQVXVSHQVLRQ)RU
WKRVH WKDW KDYH WKH SRWHQWLDO WKHUH DUH WZR EDVLF SURFHGXUHV WKDW FDQ EHXVHG WRJHQHUDWHD
VXVSHQVLRQFHOOOLQHIURPDQDQFKRUDJHGHSHQGHQWRQH

6HOHFWLRQ

7KLVPHWKRGDVGHPRQVWUDWHGE\WKHGHULYDWLRQRIWKH/6FHOOOLQHIURP/FHOOVDQG
WKH+H/D6FORQHIURP+H/DFHOOVGHSHQGVRQWKHSHUVLVWHQFHRIORRVHO\DWWDFKHGYDULDQWV
ZLWKLQWKHSRSXODWLRQ$FRQIOXHQWPRQROD\HUFXOWXUHLVOLJKWO\WDSSHGRUJHQWO\VZLUOHGWKH
PHGLXPGHFDQWHGIURPWKHFXOWXUHDQGFHOOVLQVXVSHQVLRQUHFRYHUHGE\FHQWULIXJDWLRQ&HOOV
KDYHWREHFROOHFWHGIURPPDQ\FXOWXUHVWRSURYLGHDVXIILFLHQWQXPEHUWRVWDUWDQHZFXOWXUH
DWWKHUHTXLUHGLQRFXOXPGHQVLW\ DWOHDVW[PO 7KLVSURFHGXUHKDVWREHUHSHDWHGPDQ\
WLPHVRYHUDORQJSHULRGEHFDXVHPDQ\RIWKHFHOOVWKDWDUHFROOHFWHGDUHRQO\LQWKHPLWRWLF
SKDVHUDWKHUWKDQSRWHQWLDOVXVSHQVLRQFHOOV FHOOVURXQGXSDQGEHFRPHYHU\ORRVHO\DWWDFKHG
WR WKH VXEVWUDWH GXULQJ PLWRVLV  (YHQWXDOO\ LW LV SRVVLEOH ZLWK VRPH FHOO OLQHV WR GHULYH D

ϳϬ

YLDEOHFHOOSRSXODWLRQWKDWGLYLGHVDQGJURZVLQVWDWLFVXVSHQVLRQMXVWUHVWLQJRQWKHVXEVWUDWH
UDWKHUWKDQDWWDFKLQJDQGVSUHDGLQJRXW

$GDSWDWLRQ

7KLV PHWKRG SUREDEO\ ZRUNV WKH VDPH ZD\ DV WKH VHOHFWLRQ SURFHGXUH H[FHSW WKDW D
VHOHFWLRQSUHVVXUHLVH[HUWHGRQWKHFXOWXUHZKLOHLWLVPDLQWDLQHGLQVXVSHQVLRQPHFKDQLFDOO\
+RZHYHU ZLWK PDQ\ FHOO OLQHV WKH UHODWLYHO\ ODUJH QXPEHU WKDW EHFRPHV DQFKRUDJH
LQGHSHQGHQWVXJJHVWVLWLVPRUHWKDQMXVWVHOHFWLRQRIDIHZYDULDQWFHOOV

7DEOH&RPSDULVRQRIPRQROD\HUFXOWXUHV\VWHPVVKRZLQJWKHLUUHODWLYHSURGXFWLYLW\
DQGVFDOHXSSRWHQWLDO
6XUIDFHDUHD
8QLWVXUIDFH PHGLXPUDWLRD
&XOWXUH DUHD FP  OLWUH  0D[YRO
0XOWLSOHSURFHVVHV
5RX[ERWWOH   
5ROOHUERWWOH   
&RUUXJDWHG   
6SLUDFHOO   
&RUEHLO   
&HOO)DFWRU\   
+ROORZILEUHV   
2SWLFHOO   
&HOO&XEH   
8QLWSURFHVVHV
+HOL&HO /   O E
*ODVVVSKHUHV /  
3RURXVJODVVVSKHUHV /   E
6WDFNSODWHV /  
0LFURFDUULHU JOLWUH  /  
3RURXVPLFURFDUULHU /   E
D
9ROXPHLQELRUHDFWRUGRHVQRWDOORZIRUPHGLDFKDQJHVRUUHVHUYRLU
E
&XUUHQWH[SHULPHQWDOVFDOHVVFDOHXSSRWHQWLDO

,WLVXVXDOO\QHFHVVDU\WRPDLQWDLQWKHQHZO\HVWDEOLVKHGFHOOVWUDLQLQVWLUUHGVXVSHQVLRQ
FXOWXUHEHFDXVH UHYHUVLRQWRDQFKRUDJHGHSHQGHQFHFDQRFFXULQVWDWLFFXOWXUHV6RPHWLPHV
FHOOV ZLOO DGKHUH WR WKH VXEVWUDWH ZLWKRXW EHFRPLQJ FRPSOHWHO\ VSUHDG RXW DQG FRQWLQXH WR
JURZDQGGLYLGHZLWKDQHDUVSKHULFDOPRUSKRORJ\

6WDWLFVXVSHQVLRQFXOWXUH

0DQ\FHOOOLQHVZLOOJURZDVDVXVSHQVLRQLQDFXOWXUHV\VWHPXVHGIRUPRQROD\HUFHOOV
LHZLWKQRDJLWDWLRQRUVWLUULQJ &HOOOLQHVWKDWDUHFDSDEOHRIWKLVIRUPRIJURZWKLQFOXGH
WKH PDQ\ O\PSKREODVW OLQHV HJ 02/7 5$-,  K\EULGRPDV DQG VRPH QRQKDHPRSRLHWLF
OLQHVVXFKDVWKH/6FHOOVGHVFULEHGLQWKHSUHYLRXVVHFWLRQ+RZHYHUZLWKWKHODWWHUW\SHRI
FHOOVWKHUHLVDOZD\VWKHGDQJHURIUHYHUVLRQWRDPRQROD\HU HJDVPDOOSURSRUWLRQRIWKH/6
FHOOOLQHDOZD\VDWWDFKHVDQGLVGLVFDUGHGDWHDFKVXEFXOWLYDWLRQ 6WDWLFVXVSHQVLRQFXOWXUHLV
XQVXLWDEOHIRUVFDOHXSIRUUHDVRQVDOUHDG\VWDWHGIRUPRQROD\HUFXOWXUH

ϳϭ

 
6PDOOVFDOHVXVSHQVLRQFXOWXUH

6PDOOVFDOHPHDQVOHVVWKDQOLWUHV7KLVPD\VHHPDQHQWLUHO\DUELWUDU\GHILQLWLRQEXW
LW LV PDGH RQ WKH EDVLV WKDW DERYH WKLV YROXPH DGGLWLRQDO IDFWRUV DSSO\ 7KH FRQYHQWLRQDO
ODERUDWRU\VXVSHQVLRQFXOWXUHLVWKHVSLQQHUIODVNVRFDOOHGEHFDXVHLWFRQWDLQVDPDJQHWLFEDU
DVWKHVWLLUHUDQGWKLVLVGULYHQIURPEHORZWKHYHVVHOE\DUHYROYLQJPDJQHW'HWDLOVRIVRPH
RI WKH UHDGLO\ DYDLODEOH VWLUUHU YHVVHOV WRJHWKHU ZLWK VXSSOLHUV DQG DYDLODEOH VL]H UDQJH DUH
JLYHQLQ)LJXUH

7KHUDQJHRIRSWLRQVLV
D &RQYHQWLRQDOYHVVHOVZLWKVSLQEDU %HOOFR:KHDWRQ 
E 5DGLDO SHQGXOXP  VWLUULQJ V\VWHP ILJXUH   IRU LPSURYHG PL[LQJ DW ORZ VSHHGV
XQGHUUSP  7HFKQH,QWHJUD%LRVFLHQFHV&HOO6SLQ 
F %HOOFRGXDORYHUKHDGGULYHV\VWHP UDGLDOVWLUULQJDQGSHUPLWVSHUIQVLRQ 
G 7HFKQH%UIORDWLQJLPSHOOHUV\VWHPDOORZVZRUNLQJYROXPHVRIPOWROLWUHV
WREHXVHGDQGLQFUHDVHGGXULQJFXOWXUH

1RWHLIFOXPSLQJRUDWWDFKPHQWWRWKHFXOWXUHYHVVHOVKRXOGRFFXUWKHYHVVHOVFDQEH
VLOLFRQL]HG ZLWK 'RZ &RUQLQJ  RU 5HSHOFRWF GLPHWK\OGLFKORURVLODQH  +RSNLQV DQG
:LOOLDPV RUPHGLXPZLWKUHGXFHG&DDQG0JFDQEHXVHG



)LJXUH&RPPHUFLDOO\DYDLODEOHVSLQQHUFXOWXUHV $ /+)HUPHQWDWLRQ%LRFXO 
OLWUHV  % %HOOFRDQG:KHDWRQ6SLQQHU)ODVNV POOLWUHV  & %HOOFRDQG&HOORQVSLQQHU
POOLWUHV  ' 7HFKQH POOLWUHV  ( 7HFKQH&\WRVWDW OLWUH  ) 7HFKQH%U
%LRUHDFWRU OLWUHV 


ϳϮ

 
)LJXUH  &RQWLQXRXVIORZ FXOWXUH V\VWHP &  :DWHUMDFNHWHG FXOWXUH YHVVHO :% 
ZDWHUEDWKDQGFLUFXODWLQJV\VWHP  RYHUIORZYHVVHO 5 UHVHUYRLU 3 SXPS 6 VDPSOLQJ
GHYLFH ) EXUHWWHIRUPHDVXULQJIORZUDWH 0 PDJQHWLFGULYH

6XSHU6SLQQHU

7KH 6XSHU6SLQQHU ZDV GHYHORSHG WR LQFUHDVH WKH SURGXFWLYLW\ ZLWKLQ D VSLQQHU IODVN
ZLWKRXWJRLQJWRWKHFRPSOH[LW\RIWKHKROORZILEUHDQGPHPEUDQHV\VWHPVGHVFULEHGEHORZ
,W FRQVLVWV RI D  OLWUH 'XUDQ IODVN 6FKRWW  HTXLSSHG ZLWK D WXPEOLQJ PHPEUDQH VWLUUHU
PRYLQJDSRO\SURS\OHQHKROORZILEUHWKURXJKWKHPHGLXPWRLPSURYHWKHR[\JHQVXSSO\7KH
VPDOO GHYLFH LV SODFHG LQ D &2 LQFXEDWRU DQG D VPDOO PHPEUDQH SXPS LV FRQQHFWHG YLD D
VWHULOL]LQJILOWHUZLWKWKHPHPEUDQH VWLUUHU 7KHFXOWXUHLVSODFHGRQDPDJQHWLFVWLUUHUDQG
KDVDZRUNLQJYROXPHIURPPOWRPO7KUHHGLIIHUHQWPHPEUDQHOHQJWKV DQG
 P  DUH DYDLODEOH GHSHQGLQJ XSRQ WKH GHJUHH RI R[\JHQDWLRQ WKH FHOO OLQH QHHGV &HOO
FRQFHQWUDWLRQV LQ H[FHVV RI  [ PO DUH DFKLHYHG ZLWK P$E SURGXFWLRQ RI  PJOLWUH
VSHFLILF SURGXFWLYLW\ RI P$E F  8J FHOOV  5HSHDWHG EDWFK FXOWXUH  PHGLD
UHSODFHPHQW HYHU\ WZR WR WKUHH GD\V  RYHU  GD\V SURGXFHG  PJ P$E 7KLV UHODWLYHO\
LQH[SHQVLYHPRGLILFDWLRQRIDVSLQQHUFXOWXUHLVDYDLODEOHIURP%UDXQ%LRWHFK

6FDOLQJXSIDFWRUV

,QVFDOHXSERWKWKHSK\VLFDODQGFKHPLFDOUHTXLUHPHQWVRIFHOOVKDYHWREHVDWLVILHG
7KH FKHPLFDO IDFWRUV UHTXLUH HQYLURQPHQWDO PRQLWRULQJDQG FRQWUROWR NHHS WKHFHOOV LQ WKH
SURSHU SK\VLRORJLFDO HQYLURQPHQW 7KHVHIDFWRUV LQFOXGH R[\JHQ S+ PHGLXP FRPSRQHQWV
DQG UHPRYDO RI ZDVWH SURGXFWV 3K\VLFDO SDUDPHWHUV LQFOXGH WKH FRQILJXUDWLRQ RI WKH
ELRUHDFWRU DQG WKH SRZHU VXSSOLHG WR LW 7KH IXQFWLRQ RI WKH VWLUUHU LPSHOOHU LV WR FRQYHUW
HQHUJ\ PHDVXUHG DV N:P  LQWR K\GURG\QDPLF PRWLRQ LQ WKUHH GLPHQVLRQV D[LDO UDGLDO
DQG WDQJHQWLDO  7KH LPSHOOHU KDV WR FLUFXODWH WKH ZKROH OLTXLG YROXPH DQG WR JHQHUDWH
WXUEXOHQFH LHLWKDVWRSXPSDQGWRPL[ WRFUHDWHDKRPRJHQHRXVEOHQGWRNHHSFHOOVLQ
VXVSHQVLRQ WR RSWLPL]H PDVV WUDQVIHU UDWHV EHWZHHQ WKH GLIIHUHQW SKDVHV RI WKH V\VWHP
ELRORJLFDO OLTXLG DQG JDVHRXV  DQG WR IDFLOLWDWH KHDW WUDQVIHU *RRG PL[LQJ EHFRPHV
LQFUHDVLQJO\GLIILFXOWZLWKVFDOLQJXSDQGWKHSRZHUQHHGHGWRDWWDLQKRPRJHQHLW\FDQFDXVH
ϳϯ

SUREOHPV7KHHQHUJ\JHQHUDWHGDW WKHWLSRIWKHVWLUUHUEODGHLVDOLPLWLQJIDFWRUDVLWJLYHV
ULVH WR D GDPDJLQJ VKHDU IRUFH 6KHDU IRUFHV DUH FUHDWHG E\ IOXFWXDWLQJ OLTXLG YHORFLWLHV LQ
WXUEXOHQW DUHDV 7KH IDFWRUV ZKLFK DIIHFW WKLV DUH LPSHOOHU VKDSH WKLV GLFWDWHV WKH SULPDU\
LQGXFHGIORZGLUHFWLRQ  )LJXUH WKHUDWLRRILPSHOOHUWRYHVVHOGLDPHWHUDQGWKHLPSHOOHU
WLS VSHHG D IXQFWLRQ RI URWDWLRQ UDWH DQG GLDPHWHU  7KH JUHDWHU WKH WXUEXOHQFH WKH PRUH
HIILFLHQWWKHPL[LQJEXWDFRPSURPLVHKDVWREHUHDFKHGVRWKDWFHOOVDUHQRWGDPDJHG/DUJH
LPSHOOHUVUXQQLQJDWORZVSHHGVJLYHDORZVKHDUIRUFHDQGKLJKSXPSLQJFDSDFLW\ZKHUHDV
VPDOOHULPSHOOHUVQHHGKLJKVWLUULQJVSHHGVDQGKDYHKLJKVKHDUHIIHFWV0DJQHWLFEDUVWLUULQJ
JLYHVRQO\UDGLDOPL[LQJDQGQROLIWRUWXUEXOHQFH7KHPDULQHLPSHOOHULVPRUHHIIHFWLYHIRU
FHOOVWKDQWKHIODWEODGHWXUELQHLPSHOOHUVIRXQGLQPDQ\EDFWHULDOV\VWHPVDVLWJLYHVEHWWHU
PL[LQJ DWORZVWLUULQJVSHHGV,I WKHFHOOVDUHWRR IUDJLOH IRUVWLUULQJRULIVXIILFLHQWPL[LQJ
FDQQRWEHREWDLQHGZLWKRXWFDXVLQJXQDFFHSWDEOHVKHDUUDWHVWKHQDQDOWHUQDWLYHV\VWHPPD\
KDYHWREHXVHG3QHXPDWLFHQHUJ\IRUH[DPSOHPL[LQJDLUEXEEOHV HJDLUOLIWIHUPHQWHU RU
K\GUDXOLF HQHUJ\ HJ PHGLXP SHUIXVLRQ  FDQ EH VFDOHGXS ZLWKRXW SURSRUWLRQDOO\
LQFUHDVLQJ WKH SRZHU 7R LPSURYH WKH HIILFLHQF\ RI PHFKDQLFDO VWLUULQJ WKH GHVLJQ RI WKH
VWLUUHUSDGGOHFDQEHDOWHUHG HJDVGHVFULEHGIRUPLFURFDUULHUFXOWXUH RUPXOWLSOHLPSHOOHUV
FDQEHXVHG

$ WRWDOO\ GLIIHUHQW VWLUULQJ FRQFHSW LV WKH 9LEURPL[HU 7KLV LV D QRQURWDWLQJ DJLWDWRU
ZKLFKSURGXFHVDVWLUULQJHIIHFWE\DYHUWLFDOUHFLSURFDWLQJPRWLRQZLWKDSDWKRIPPDW
DIUHTXHQF\RI+]7KHPL[LQJGLVFLVIL[HGKRUL]RQWDOO\WRWKHDJLWDWRUVKDIWDQGFRQLFDO
VKDSHGKROHVLQWKHGLVFFUHDWHDSXPSLQJDFWLRQWRRFFXUDVWKHVKDIWYLEUDWHVXSDQGGRZQ
7KH VKDIW LV GULYHQ E\ D PRWRU ZKLFK RSHUDWHV WKURXJK DQ HODVWLF GLDSKUDJP WKLV DOVR
SURYLGHV D VHDO DW WKH WRS RI WKH FXOWXUH $ IHUPHQWDWLRQ V\VWHP XVLQJ WKLV SULQFLSOH LV
DYDLODEOH FRPPHUFLDOO\ 9LEUR)HUPHQWHU &KHPDS  7KH DGYDQWDJHV RI WKLV V\VWHP DUH WKH
JUHDWO\ UHGXFHG VKHDU IRUFHV UDQGRP PL[LQJ UHGXFHG IRDPLQJ DQG UHGXFHG HQHUJ\
UHTXLUHPHQWHVSHFLDOO\IRUVFDOLQJXS

7KH VLJQLILFDQW HIIHFW RQ YHVVHO GHVLJQ RI PRYLQJ IURP D PDJQHWLF VWLUUHU WR D GLUHFW
GULYHV\VWHPLVWKHIDFWWKDWWKHGULYHKDVWRSDVVWKURXJKWKHFXOWXUHYHVVHO7KLVPHDQVVRPH
FRPSOH[LW\ RI GHVLJQ WRHQVXUH D SHUIHFW DVHSWLF VHDO ZKLOH WUDQVIHUULQJ WKH GULYH FRPSOHWH
ZLWKOXEULFDWHGEHDULQJVWKURXJKWKHERWWRPRUWRSSODWHRIWKHYHVVHO&XOWXUHYHVVHOVZLWK
PDJQHWLFFRXSOLQJDUHEHFRPLQJDYDLODEOHDWLQFUHDVLQJO\KLJKHUYROXPHVDQGRYHUFRPHWKLV
SUREOHPRIDVHSWLFVHDOV

6FDOLQJXSFDQQRWEHSURSRUWLRQDORQHFDQQRWFRQYHUWDOLWUHUHDFWRULQWRDOLWUH
UHDFWRU VLPSO\ E\ LQFUHDVLQJ DOO GLPHQVLRQV E\ WKH VDPH DPRXQW 7KH UHDVRQV IRU WKLV DUH
PDWKHPDWLFDO GRXEOLQJ WKH GLDPHWHU LQFUHDVHV WKH YROXPH WKUHHIROG DQG WKLV DIIHFWV WKH
GLIIHUHQWSK\VLFDOSDUDPHWHUVLQGLIIHUHQWZD\V2QHIDFWRUWREHWDNHQLQWRFRQVLGHUDWLRQLV
WKHKHLJKWGLDPHWHUUDWLRDVWKLVLVRQHRIWKHPRVWLPSRUWDQWIHUPHQWHUGHVLJQSDUDPHWHUV,Q
VSDUJHG V\VWHPV WKH WDOOHU WKH IHUPHQWHU LQ UHODWLRQ WR LWV GLDPHWHU WKH EHWWHU DV WKH DLU
SUHVVXUHZLOOEHKLJKHUDWWKHERWWRP LQFUHDVLQJWKHR[\JHQVROXELOLW\ DQGWKHUHVLGHQFHWLPH
RI EXEEOHV ORQJHU +RZHYHU LQ QRQVSDUJHG V\VWHPV ZKLFK DUH RIWHQ XVHG IRU DQLPDO FHOOV
DQGUHO\RQVXUIDFHDHUDWLRQWKHVXUIDFHDUHDKHLJKWUDWLRLVPRUHLPSRUWDQWDQGDUDWLR
VKRXOGQRWEHH[FHHGHG SUHIHUDEO\ 0DVVWUDQVIHUEHWZHHQWKHFXOWXUHSKDVHVKDVEHHQ
GLVFXVVHGLQUHODWLRQWRR[\JHQ,WLVWKLVFKDUDFWHULVWLFRIVFDOLQJXSWKDWGHPDQGVWKHH[WUD
VRSKLVWLFDWLRQ LQ FXOWXUH GHVLJQ WR PDLQWDLQ D SK\VLRORJLFDOO\ FRUUHFW HQYLURQPHQW 7KLV
VRSKLVWLFDWLRQLQFOXGHVLPSHOOHUGHVLJQR[\JHQGHOLYHU\V\VWHPVYHVVHOJHRPHWU\SHUIXVLRQ
ORRSVRUDFRPSOHWHO\GLIIHUHQWFRQFHSWLQFXOWXUHGHVLJQWRWKHVWLUUHGELRUHDFWRU


ϳϰ

6WLUUHGELRUHDFWRUV

7KH PRYH IURP H[WHUQDOO\ GULYHQ PDJQHWLF VSLQQHU YHVVHOV WR IHUPHQWHUV FDSDEOH RI
VFDOHXS IURP  OLWUH WR  OLWUHV DQG EH\RQG KDV WKH IROORZLQJ FRQVHTXHQFHV DW VRPH
VWDJH
D &KDQJHIURPJODVVWRVWDLQOHVVVWHHOYHVVHOV
E  &KDQJH IURP D PRELOH WR D VWDWLF V\VWHP FRQQHFWLRQ WR VWHDP IRU LQ VLWX VWHULOL]DWLRQ
UHTXLUHPHQWIRUZDWHUMDFNHWRULQWHUQDOWHPSHUDWXUHFRQWUROQHHGIRUDVHHGYHVVHODPHGLXP
KROGLQJYHVVHODQGGRZQVWUHDPSURFHVVLQJFDSDELOLW\
F  *UHDWHU VRSKLVWLFDWLRQ LQ HQYLURQPHQWDO FRQWURO V\VWHPV WR PHHW WKH LQFUHDVLQJ PDVV
WUDQVIHUHTXLSPHQW

,QSUDFWLFHWKHPD[LPXPVL]HIRUDVSLQQHUYHVVHOLVOLWUHV$ERYHWKLVVL]HWKHUHDUH
GLIILFXOWLHVLQKDQGOLQJDQGDXWRFODYLQJDVZHOODVWKHGLIILFXOW\RIEHLQJDEOHWRDJLWDWHWKH
FXOWXUHDGHTXDWHO\)HUPHQWHUVZLWKPRWRUGULYHQVWLUUHUVDUHDYDLODEOHIURPPOEXWWKHVH
DUHFKLHIO\IRUEDFWHULDOJURZWK,WLVDVLJQLILFDQWVWHSWRPRYHDERYHWKHOLWUHVFDOHDV
WKHFRVWRIWKHHTXLSPHQWLVVLJQLILFDQW HJIRUDFRPSOHWHOLWUHV\VWHP DQG
VXLWDEOH ODERUDWRU\ IDFLOLWLHV DUH UHTXLUHG VWHDP GUDLQDJH HWF  7KHUH LV D ZLGH UDQJH RI
YHVVHOVDYDLODEOHIURPWKHYDULRXVIHUPHQWHUVXSSOLHUVZKLFKLQFOXGHVRPHRIWKHIROORZLQJ
PRGLILFDWLRQV

x VXLWDEOHLPSHOOHU HJPDULQH 
x QREDIIOHV
x FXUYHGERWWRPIRUEHWWHUPL[LQJDWORZVSHHGV
x ZDWHUMDFNHWUDWKHUWKDQLPPHUVLRQKHDWHUW\SHWHPSHUDWXUHFRQWURO WRDYRLGORFDOL]HG
KHDWLQJDWORZVWLUULQJVSHHGV 
x WRSGULYHQVWLUUHUVRWKDWFHOOVFDQQRWEHFRPHHQWDQJOHGEHWZHHQPRYLQJSDUWV
x PLUURULQWHUQDOILQLVKHVWRUHGXFHPHFKDQLFDOGDPDJHDQGFHOODWWDFKPHQW

6LQFH DGHTXDWH PL[LQJ DQG WKXV PDVV WUDQVIHU RI R[\JHQ LQWR WKH YHVVHO FDQ EH
PDLQWDLQHG ZLWKRXW GDPDJLQJ WKH FHOOV WKHUH LV QR PD[LPXP WR WKH VFDOHXS SRWHQWLDO
1DPDOYDFHOOVKDYHEHHQJURZQLQOLWUHYHVVHOVIRUWKHSURGXFWLRQRILQWHUIHURQ7KHUH
DUHPDQ\KHWHURSORLGFHOOOLQHVVXFKDV9HUR+H/DDQGK\EULGRPDVZKLFKZRXOGJURZLQ
VXFKV\VWHPV:KLOVWUHJXODWRU\DJHQFLHVUHTXLUHSKDUPDFHXWLFDOSURGXFWVWREHPDQXIDFWXUHG
SUHGRPLQDQWO\ IURP QRUPDO GLSORLG FHOOV ZKLFK ZLOO QRW JURZ LQ VXVSHQVLRQ  WKH RQO\
PRWLYHIRUXVLQJWKLVVFDOHRIFXOWXUHZDVIRUYHWHULQDU\SURGXFWV+RZHYHUWKHOLFHQVLQJRI
SURGXFWV VXFK DV W3$ (32 LQWHUIHURQ DQG WKHUDSHXWLF PRQRFORQDO DQWLERGLHV IURP
KHWHURSORLG OLQHV PHDQVWKDW ODUJH VFDOH ELRUHDFWRUV DUH LQ ZLGHVSUHDG XVH 7KHUH DUH PDQ\
DSSOLFDWLRQVIRUUHVHDUFKSURGXFWVIURPYDULRXVW\SHVRIFHOOVDQGWKLVLVVHUYHGE\WKH
OLWUH UDQJH RI YHVVHOV $W SUHVHQW WKH JUHDWHVW LQFHQWLYH IRU ODUJH VFDOH V\VWHPV LV WR JURZ
K\EULGRPDFHOOV SURGXFLQJPRQRFORQDODQWLERG\ ,QWLVVXHFXOWXUHWKHDQWLERG\\LHOGLV
WR IROG ORZHU WKDQ ZKHQ WKH FHOOV DUH SDVVDJHG WKURXJK WKH SHULWRQHDO FDYLW\ RI PLFH
DOWKRXJKWKHSXULW\LVJUHDWHUSDUWLFXODUO\LIVHUXPIUHHPHGLXPLVXVHG7KHPDLQQHHGLVWR
VXSSO\ DQWLERGLHV WR PHHW WKH UHTXLUHPHQWV IRU GLDJQRVWLF DQG DIILQLW\ FKURPDWRJUDSK\
SXUSRVHVEXWLQFUHDVLQJO\DVQHZWKHUDSHXWLFDQGSURSK\ODFWLFGUXJVDUHEHLQJGHYHORSHGDQG
OLFHQVHGPXFKODUJHUTXDQWLWLHVDUHUHTXLUHG





ϳϱ

&RQWLQXRXVIORZFXOWXUH
,QWURGXFWLRQ

$WVXEPD[LPDOJURZWKUDWHVWKHJURZWKRIDFHOOLVGHWHUPLQHGE\WKHFRQFHQWUDWLRQRI
DVLQJOHJURZWKOLPLWLQJQXWULHQW7KLVLVWKHEDVLVRIWKHFKHPRVWDWDIL[HGYROXPHFXOWXUHLQ
ZKLFKPHGLXPLVIHGLQDWDFRQVWDQWUDWHPL[HGZLWKFHOOVDQGWKHQOHDYHVDWWKHVDPHUDWH
7KHFXOWXUHEHJLQVDVDEDWFKFXOWXUHZKLOHWKHLQRFXOXPJURZVWRWKHPD[LPXPYDOXHWKDW
FDQEHVXSSRUWHGE\WKHJURZWKOLPLWLQJQXWULHQW DVVXPLQJWKHGLOXWLRQUDWHLVOHVVWKDQWKH
PD[LPXP JURZWK UDWH  $V WKH JURZWKOLPLWLQJ QXWULHQW GHFUHDVHV LQ FRQFHQWUDWLRQ VR WKH
JURZWKUDWHGHFOLQHVXQWLOLWHTXDOVWKHGLOXWLRQUDWH:KHQWKLVRFFXUVWKHFXOWXUHLVGHILQHG
DV EHLQJ LQ D VWHDG\ VWDWH  DV ERWK WKH FHOO QXPEHUV DQG QXWULHQW FRQFHQWUDWLRQV UHPDLQ
FRQVWDQW:KHQWKHFXOWXUHLVLQDVWHDG\VWDWHWKHFHOOJURZWKUDWH X LVHTXDOWRWKHGLOXWLRQ
UDWH '  7KH GLOXWLRQ UDWH LV WKH TXRWLHQW RI WKH PHGLXP IORZ UDWH SHU XQLW WLPH DQG WKH
FXOWXUHYROXPH 9 


$V WKH JURZWK UDWH LV GHSHQGHQW RQ WKH PHGLXP IORZ UDWH WKH PHDQ JHQHUDWLRQ
GRXEOLQJ WLPHFDQEHFDOFXODWHG


$Q DOWHUQDWLYH V\VWHP WR WKH FKHPRVWDW LV WKH WXUELGRVWDW LQ ZKLFK WKH FHOO GHQVLW\ LV
KHOGDW D IL[HG YDOXH E\ DOWHULQJ WKH PHGLXP VXSSO\ 7KH FHOO GHQVLW\ WXUELGLW\  LV XVXDOO\
PHDVXUHG WKURXJK D SKRWRHOHFWULF FHOO :KHQ WKH YDOXH LV EHORZ WKH IL[HG SRLQW PHGLXP
VXSSO\LVVWRSSHGWRDOORZWKHFHOOVWRLQFUHDVHLQQXPEHU$ERYHWKHIL[HGSRLQWPHGLXPLV
VXSSOLHG WR ZDVK RXW WKH H[FHVV FHOOV 7KLV V\VWHP UHDOO\ ZRUNV ZHOO RQO\ ZKHQ WKH FHOO
JURZWKUDWHLVQHDUPD[LPXP+RZHYHUWKLVLVLWVPDLQDGYDQWDJHRYHUWKHFKHPRVWDWZKLFK
LVOHDVWHIILFLHQWRUFRQWUROODEOHZKHQRSHUDWLQJDWWKHFHOO VPD[LPXPJURZWKUDWH

(TXLSPHQW

&RPSOHWHFKHPRVWDWV\VWHPVFDQEHSXUFKDVHGIURPGHDOHUVLQIHUPHQWDWLRQHTXLSPHQW
+RZHYHUV\VWHPVFDQEHHDVLO\FRQVWUXFWHGLQWKHODERUDWRU\ )LJXUH 7KHFXOWXUHYHVVHO
QHHGVDVLGHDUPRYHUIORZDWWKHUHTXLUHG OLTXLGOHYHOZKLFKVKRXOG EHDSSUR[LPDWHO\ KDOI
WKH YROXPH RI WKH YHVVHO ,I D VXLWDEOH ƒ& FDELQHW LV QRW DYDLODEOH WKHQ D ZDWHUMDFNHWHG
YHVVHOLVQHHGHG$SDUWIURPWKLVDOORWKHUFRPSRQHQWVDUHVWDQGDUGODERUDWRU\LWHPV9HVVHO
HQFORVXUHVFDQEHPDGHIURPVLOLFRQH RUZKLWHUXEEHU EXQJVZLUHGRQWRWKHFXOWXUHYHVVHO
$JRRGTXDOLW\SHULVWDOWLFSXPSVXFKDVWKH:DWVRQ0DUORZUDQJHLVUHFRPPHQGHG

([SHULPHQWDOSURFHGXUHV

5HFRPPHQGHGFHOOVDUH/6+H/D6RUDQHVWDEOLVKHGO\PSKREODVWLFFHOOOLQHVXFKDV
/ RU D K\EULGRPD *URZWKOLPLWLQJ IDFWRUV FDQ EH FKRVHQ IURP WKH DPLQR DFLGV HJ
F\VWLQH RUJOXFRVH

8VHV

&RQWLQXRXVIORZFXOWXUHSURYLGHV DUHDGLO\DYDLODEOHFRQWLQXRXVVRXUFHRIFHOOV$OVR
EHFDXVHRSWLPDOFRQGLWLRQVRUDQ\GHVLUHGSK\VLRORJLFDOHQYLURQPHQWFDQEHPDLQWDLQHGWKH
FXOWXUHLVYHU\VXLWDEOHIRUSURGXFWJHQHUDWLRQ DVDOUHDG\VKRZQIRUYLUXVHVDQGLQWHUIHURQ 

ϳϲ

)RUPDQ\SXUSRVHVDWZRVWDJHFKHPRVWDWLVUHTXLUHGVRWKDWRSWLPDOFRQGLWLRQVFDQEHPHW
IRUFHOOJURZWK ILUVWVWDJH DQGSURGXFWJHQHUDWLRQ VHFRQGVWDJH 

$LUOLIWIHUPHQWHU

7KHDLUOLIWIHUPHQWHUUHOLHVRQWKHEXEEOHFROXPQSULQFLSOHERWKWRDJLWDWHDQGWRDHUDWH
DFXOWXUH,QVWHDGRIPHFKDQLFDOO\VWLUULQJWKHFHOOVDLUEXEEOHVDUHLQWURGXFHGLQWRWKHERWWRP
RI WKH FXOWXUH YHVVHO $Q LQQHU GUDIW  WXEH LV SODFHG LQVLGH WKH YHVVHO DQG PL[LQJ RFFXUV
EHFDXVHWKHDLUEXEEOHVOLIWWKHPHGLXP DHUDWHGPHGLXPKDVDORZHUGHQVLW\WKDQQRQDHUDWHG
PHGLXP 7KHPHGLXPDQGFHOOVZKLFKVSLOORXWIURPWKHWRSRIWKHGUDIWWXEHWKHQFLUFXODWH
GRZQWKHRXWVLGHRIWKHYHVVHO7KHDPRXQWRIHQHUJ\ FRPSUHVVHGDLU QHHGHGIRUWKHV\VWHP
LVYHU\ORZVKHDUIRUFHVDUHDEVHQWDQGWKLVPHWKRGLVWKXVLGHDOIRUIUDJLOHDQLPDODQGSODQW
FHOOV $OVR DV R[\JHQ LV FRQWLQXRXVO\ VXSSOLHG WR WKH FXOWXUH WKH ODUJH QXPEHU RI EXEEOHV
UHVXOWVLQDKLJKPDVVWUDQVIHUUDWH&XOWXUHXQLWVDVLOOXVWUDWHGLQ)LJXUHDUHFRPPHUFLDOO\
DYDLODEOHLQVL]HVIURPOLWUHV %UDXQ%LRWHFK 7KHRQHGLVDGYDQWDJHRIWKHV\VWHPLVWKDW
VFDOHXSLVPRUHRUOHVVOLQHDU WKHOLWUHYHVVHOUHTXLUHVQHDUO\PKHDGURRP :KHWKHULW
ZLOO EH SRVVLEOH WR XVH PXOWLSOH GUDIW WXEHV DQG WKXV HQDEOH XQLWV ZLWK JUHDWO\ LQFUHDVHG
GLDPHWHUVWREHXVHGUHPDLQVDGHYHORSPHQWDOFKDOOHQJH+RZHYHUOLWUHUHDFWRUVDUHLQ
RSHUDWLRQIRUWKHSURGXFWLRQRIPRQRFORQDODQWLERGLHV

,PPRELOL]HGFXOWXUHV

,PPRELOL]HGFXOWXUHVDUHSRSXODUEHFDXVHWKH\DOORZIDUKLJKHUXQLWFHOOGHQVLWLHVWREH
DFKLHYHG  [  FHOOVPO  DQG WKH\ DOVR FRQIHU VWDELOLW\ DQG WKHUHIRUH ORQJHYLW\ WR
FXOWXUHV&HOOVLQYLYRDUHLQDWKUHHGLPHQVLRQDOWLVVXHPDWUL[WKHUHIRUHLPPRELOL]DWLRQFDQ
PLPLF WKLV SK\VLRORJLFDO VWDWH +LJKHU FHOO GHQVLW\ LV DFKLHYHG E\ IDFLOLWDWLQJ SHUIXVLRQ RI
VXVSHQVLRQ FHOOV DQG LQFUHDVLQJ WKH XQLW VXUIDFH DUHD IRU DWWDFKHG FHOOV ,Q DGGLWLRQ PDQ\
LPPRELOL]DWLRQPDWHULDOVSURWHFWFHOOVIURPVKHDUIRUFHVFUHDWHGE\PHGLXPIORZG\QDPLFV
$VFHOOVLQFUHDVHLQXQLWGHQVLW\WKH\EHFRPHOHVVGHSHQGHQWRQWKHH[WHUQDOVXSSO\RIPDQ\
JURZWK IDFWRUVSURYLGHG E\ VHUXPVR UHDOFRVW VDYLQJV FDQ EH DFKLHYHG7KH HPSKDVLV KDV
EHHQ RQ GHYHORSLQJ V\VWHPV IRU VXVSHQVLRQ FHOOV EHFDXVH FRPPHUFLDO SURGXFWLRQ RI
PRQRFORQDODQWLERG\KDVEHHQVXFKDGRPLQDQWIDFWRU%DVLFDOO\WZRDSSURDFKHVKDYHEHHQ
XVHG LPPXUHPHQW FRQILQLQJ FHOOV ZLWKLQ D PHGLXPSHUPHDEOH EDUULHU  DQG HQWUDSPHQW
HQPHVKLQJ FHOOV ZLWKLQ DQ RSHQ PDWUL[ WKURXJK ZKLFK PHGLXP FDQ IORZ XQKLQGHUHG 
,PPRELOL]DWLRQWHFKQLTXHV WKDWFDQ EH VFDOHGXS VXFKDVWKHSRURXVFDUULHUVZLOOEHFRPHD
GRPLQDQWSURGXFWLRQWHFKQRORJ\RQFHWKHEHDGVDQGSURFHVVSDUDPHWHUVKDYHEHHQRSWLPL]HG
7KH\DUHFXUUHQWO\H[FHOOHQWODERUDWRU\V\VWHPVIRUWKHPDQXIDFWXUHRIFHOOSURGXFWVDQGZLWK
JHODWLQFDUULHUVSURGXFWLRQRIFHOOV

,PPXUHPHQWFXOWXUHV
+ROORZILEUHV

7KHVH DUH YHU\ HIIHFWLYH IRU VXVSHQVLRQ FHOOV DW VFDOHV XS WR DERXW  OLWUH  ;  
FHOOVPO  6LPSOH V\VWHPV FDQ EH VHW XS LQ WKH ODERUDWRU\ E\ SXUFKDVLQJ LQGLYLGXDO KROORZ
ILEUH FDUWULGJHV HJ $PLFRQ 0LFURJRQ  $OO WKDW LV QHHGHG LV D PHGLXP UHVHUYRLU DQG D
SXPS WR FLUFXODWH WKH PHGLXP WKURXJK WKH LQWUDFDSLOODU\ VHFWLRQ RI WKH FDUWULGJH DQG D
KDUYHVWOLQHIURPWKHH[WUDFDSLOODU\FRPSDUWPHQWLQZKLFKWKHFHOOVDQGSURGXFWUHVLGH7RJHW
EHWWHU SHUIRUPDQFH WKHUH DUH D QXPEHU RI WXUQNH\  V\VWHPV WKDW FDQ EH SXUFKDVHG IURP
UHODWLYHO\ VLPSOH XQLWV HJ .LQHWHN &HOOFR &HOO3KDUP $PLFRQ 0LQL )OR3DWK  $VDKL
0HGLFDO&R &XOWXUHIOR WRH[WUHPHO\FRPSOH[DQGVRSKLVWLFDWHGXQLWV HJ&HOOH[$FXV\VW 

ϳϳ

FDSDEOH RI SURGXFLQJ XS WR  J RI PRQRFORQDO DQWLERG\ SHU PRQWK 7KH $FXV\VW
(QGRWURQLFVQRZ&HOOH[%LRVFLHQFHV,QF V\VWHPPDGHWKHEUHDNWKURXJKE\XVLQJSUHVVXUH
GLIIHUHQWLDOVWRVLPXODWHLQYLYRDUWHULDOIORZ7KHXQLWKDVDGXDOPHGLXPFLUFXLWRQHSDVVLQJ
WKURXJKWKHOXPHQWKHRWKHUWKURXJKWKHH[WUDFDSLOODU\ FHOO VSDFH%\F\FOLFDOO\DOWHUQDWLQJ
WKH SUHVVXUH EHWZHHQ WKH WZR FLUFXLWV PHGLXP LV PDGH WR SDVV HLWKHU LQWR RU RXW RI WKH
OXPHQ7KLV DOORZV DIOXVKLQJ RI PHGLXP WKURXJK WKH FHOO FRPSDUWPHQWDQGRYHUFRPHV WKH
JUDGLHQWSUREOHPDQGJLYHVWKHSRVVLELOLW\RIFRQFHQWUDWLQJWKHSURGXFWIRUKDUYHVWLQJ7KHUH
DUH D UDQJH RI $FXV\VW XQLWV WKH $FXV\VW 0LQL0D[ DQG 0D[LPLVHU EHLQJ WKH ODERUDWRU\
PRGHOV XVLQJ UHVSHFWLYHO\  DQG  OLWUHV RI PHGLXP SHU GD\ DQG FDSDEOH RI UXQQLQJ
FRQWLQXRXVO\ IRU  GD\V IRXU WR ILYH PRQWKV EHLQJ D W\SLFDO UXQ OHQJWK  7KHUH LV DQ
LQLWLDOJURZWKSKDVHRIGD\VGHSHQGLQJXSRQLQRFXOXPVL]HPHGLXPFRPSRVLWLRQDQG
FHOO OLQH DQG ZKHQ D GHQVLW\ RI  [ FHOOV LV UHDFKHG  P FDUWULGJH HJ $FXV\VW
0D[LPLVHU SURGXFWLRQVWDUWV DQG GDLO\ KDUYHVWLQJ RI P$E EHJLQV&HOOVFDQQRWEHVDPSOHG
GXULQJWKHFXOWXUHVRUHOLDQFHLVSODFHGXSRQDQXPEHURISURFHVVPHDVXUHPHQWVPDGHRQD
UHJXODUEDVLVRQOLQHS+DQGR[\JHQRIIOLQHJOXFRVHODFWDWHDQGLIQHFHVVDU\DPPRQLDDQG
/'+ IRUORVVRIYLDELOLW\ DWOHDVWZHHNO\

7KH 7HFQRPRXVH LV DQRWKHU KROORZ ILEUH ELRUHDFWRU FRQWDLQLQJ XS WR ILYH IODW FXOWXUH
FDVVHWWHV FRQWDLQLQJ KROORZ ILEUHV VXUURXQGHG E\ D VLOLFRQH PHPEUDQH WKDW JLYHV XQLIRUP
R[\JHQDWLRQDQGQXWULHQWVXSSO\RIWKHFXOWXUHDQGHQVXUHVKRPRJHQHLW\ZLWKLQWKHFXOWXUH
7KH V\VWHP FRPSULVHV D FRQWURO XQLW D JDV DQG PHGLXP VXSSO\ XQLW DQG WKH ILYH FXOWXUH
FDVVHWWHV7KHFXOWXUHLVLQLWLDWHGZLWKFHOOVIURP[FPIODVNV [ DQGJURZVWR
[  FHOOV 7KH FRQWLQXRXV PHGLXP VXSSO\ LV FRQWUROODEOH DQG SURJUDPPDEOH ZLWK W\SLFDO
IORZUDWHV SHUIXVLRQRUUHFLUFXODWLRQ RIPOKLQFUHDVLQJWRPOKLQPOVWHSV$IWHUVL[
GD\V KDUYHVWLQJ FDQ EH VWDUWHG DQG UHSHDWHG HYHU\ WZR WR WKUHH GD\V IRU  GD\V (DFK
FDVVHWWHJLYHVPOFXOWXUHZLWKPJPOP$E HTXLYDOHQWWRDQDYHUDJHRIPJGD\ 
7KXVDERXWOLWUHVZLOO\LHOGPJP$EPRQWKDQGJPRQWKXVLQJWKHILYHFDVVHWWHV
GDWDEDVHGRQPDQXIDFWXUHU VLQIRUPDWLRQ 

0HPEUDQHFXOWXUHV\VWHPV PLQL3(50 

7KHUHKDVEHHQDQXPEHURIPHPEUDQHEDVHGFXOWXUHXQLWVGHYHORSHGPDQ\EDVHGRQ
GLDO\VLV WXELQJ DQG HYHQ DYDLODEOH DV ODUJH IHUPHQWHUV %LRHQJLQHHULQJ $* 0HPEUDQH
/DERUDWRU\)HUPHQWHUZLWKD&XSKURQGLDO\VLVPHPEUDQHRI'DOWRQPROHFXODUZHLJKW
FXWRII IRUPLQJ DQ LQQHU FKDPEHU  2QH RI WKH PRUH VXFFHVVIXO DQG FXUUHQWO\ DYDLODEOH
V\VWHPVLVGHVFULEHGKHUHWKHPLQL3(50%LRUHDFWRU +HUDHQV,QVWUXPHQWV 

7KHPLQL3(50%LRUHDFWRUFRQVLVWVRIWZRFRPSRQHQWVWKHSURGXFWLRQPRGXOH PO 
FRQWDLQLQJWKHFHOOVDQGWKHQXWULHQWPRGXOH PORIPHGLXP 7KHPRGXOHVDUHVHSDUDWHG
E\DVHPLSHUPHDEOHGLDO\VLVPHPEUDQH 0:&2N'D ZKLFKUHWDLQVWKHFHOOVDQGP$E
LQWKHSURGXFWLRQPRGXOHEXWDOORZVPHWDEROLFZDVWHSURGXFWVWRGLIIXVHRXWWRWKHQXWULHQW
PRGXOH7KHUHLVDSHUPHDEOHVLOLFRQHUXEEHUPHPEUDQHIRUR[\JHQDWLRQDQGJDVH[FKDQJHLQ
WKHSURGXFWLRQPRGXOH7KHZKROHXQLWURWDWHV XSWRUSP ZLWKLQD&  LQFXEDWRU,WFDQ
EH SXUFKDVHG DV D FRPSOHWH GLVSRVDEOH UHDG\ WR XVH XQLW RU WKH QXWULHQW PRGXOH
SRO\FDUERQDWH FDQEHDXWRFODYHGDQGUHXVHGDWOHDVWWHQWLPHV

(QFDSVXODWLRQ

7KHHQWUDSPHQWRIFHOOVLQVHPLVROLGPDWULFHVRUVSKHUHVKDVPDQ\DSSOLFDWLRQVEXW
WKHEDVLFIXQFWLRQLVWRVWDELOL]HWKHFHOODQGWKXVSURWHFWLWIURPVXERSWLPDOFRQGLWLRQV&HOOV

ϳϴ

FDQ EH LPPRELOL]HG E\ DGVRUSWLRQ FRYDOHQW ERQGLQJ FURVVOLQNLQJ RU HQWUDSPHQW LQ D
SRO\PHULF PDWUL[ 0DWHULDOV WKDW FDQ EH XVHG DUH JHODWLQ SRO\O\VLQH DOJLQDWH DQG DJDURVH
WKH FKRLFH ODUJHO\ GHSHQGV XSRQ WKH SUREOHP EHLQJ DGGUHVVHG 7KH PDWUL[ DOORZV IUHH
GLIIXVLRQRIQXWULHQWVDQGJHQHUDWHGSURGXFWEHWZHHQWKHHQFORVHGPLFURHQYLURQPHQWDQGWKH
H[WHUQDOPHGLXP$OJLQDWHLVDSRO\VDFFKDULGHDQGLVFURVVOLQNHGZLWK&DLRQV7KHUDWHRI
FURVVOLQNLQJLVGHSHQGHQWRQWKHFRQFHQWUDWLRQRI&D HJPLQZLWKP0&D&O $
UHFRPPHQGHGWHFKQLTXHLVWRVXVSHQGWKHFHOOVLQLVRWRQLF1D&OEXIIHUHGZLWK7ULV P0 
DQGVRGLXPDOJLQDWHDQGWRDGGWKLVPL[WXUHGURSZLVHLQWRDVWLUUHGVROXWLRQRILVRWRQLF
1D&OP07ULVP0&DDWS+7KHUHVXOWLQJVSKHUHVDUHPPLQGLDPHWHU7KH
HQWUDSSHG FHOOV FDQ EH KDUYHVWHG E\ GLVVROYLQJ WKH SRO\PHU LQ   0 ('7$ RU  P0
VRGLXP FLWUDWH 'LVDGYDQWDJHV RI DOJLQDWH DUH WKDW FDOFLXP PXVW EH SUHVHQW DQG SKRVSKDWH
DEVHQWDQGWKDWODUJHPROHFXOHVXFKDVPRQRFORQDODQWLERGLHVFDQQRWGLIIXVHRXW)RUWKHVH
UHDVRQV DJDURVH LQ D VXVSHQVLRQ RI SDUDIILQ RLO SURYLGHV D PRUH VXLWDEOH DOWHUQDWLYH 
DJDURVHLQ3%6IUHHRI&DDQG0JLVPHOWHGDWƒ&FRROHGWRƒ&DQGPL[HGZLWKFHOOV
VXVSHQGHG LQ WKHLU QRUPDO JURZWK PHGLXP 7KLV PL[WXUH LV DGGHG WR DQ HTXDO YROXPH RI
SDUDIILQRLODQGHPXOVLILHGZLWKD9LEURPL[HU7KHHPXOVLRQLVFRROHGLQDQLFHEDWKJURZWK
PHGLXP DGGHG DQG DIWHU FHQWULIXJDWLRQ WKH RLO LV UHPRYHG 7KH VSKHUHV  XP  DUH
ZDVKHG LQ PHGLXP FHQWULIXJHG DQG DIWHU UHPRYLQJ WKH UHPDLQLQJ RLO WUDQVIHUUHG WR WKH
FXOWXUH YHVVHO $ FXVWRPPDGH XQLW FDQ EH SXUFKDVHG %HOOFR %LRUHDFWRU  7KLV  OLWUH
IOXLGL]HGEHGFXOWXUH EXEEOHFROXPQ DFWXDOO\HQFDSVXODWHVWKHFHOOVLQK\GURJHOEHDGVZLWKLQ
WKHFXOWXUHYHVVHODQGFRPHVZLWKDUDQJHRIPRGXODUXQLWVWRFRQWURODOOSURFHVVSDUDPHWHUV

(QWUDSPHQWFXOWXUHV
2SWLFHOO

7KHVSHFLDOFHUDPLFFDUWULGJHVIRUVXVSHQVLRQFHOOV 6&RUH HQWUDSWKHFHOOVZLWKLQWKH
SRURXVFHUDPLFZDOOVRIWKHXQLW7KH\DUHDYDLODEOHLQVL]HVIURPPWRP PXOWLSOH
FDUWULGJHV  ZKLFK ZLOO VXSSRUW  [  FHOOV ZLWK D IHHGKDUYHVW UDWH RI  OLWUHVGD\ DQG
JLYHD\LHOGRIDERXWJRIPRQRFORQDODQWLERG\SHUGD\

)LEUHV

$VLPSOHODERUDWRU\PHWKRGLVWRHQPHVKFHOOVLQFHOOXORVHILEUHV '($(7/&4$(
7($( DOO IURP 6LJPD  7KH ILEUHV DUH DXWRFODYHG DW  PJPO LQ 3%6 ZDVKHG WZLFH LQ
VWHULOH3%6DQGDGGHGWRWKHPHGLXPDWDILQDOFRQFHQWUDWLRQRIPJPOLQDVSLQQHUVWLUUHG
ELRUHDFWRU7KLVPHWKRGKDVHYHQEHHQIRXQGVXLWDEOHIRUKXPDQGLSORLGFHOOV

3RURXVFDUULHUV

0LFURFDUULHUV DQG JODVV VSKHUHV DUH UHVWULFWHG WR DWWDFKHG FHOOV DQG EHFDXVH D VSKHUH
KDVDORZVXUIDFHDUHDYROXPHUDWLRUHVWULFWHGLQWKHLUFHOOGHQVLW\SRWHQWLDO7KHLUDGYDQWDJHV
DUHVXPPDUL]HGLQ7DEOH$FKDQJHIURPDVROLGWRSRURXVVSKHUHRIRSHQLQWHUFRQQHFWLQJ
SRUHV )LJXUH   LQFUHDVHV WKHLU SRWHQWLDO HQRUPRXVO\ 7KHUH DUH YDULRXV W\SHV RI SRURXV
PLFURFDUULHU FRPPHUFLDOO\ DYDLODEOH 7DEOH   $ FKDUDFWHULVWLF RI WKHVH SRURXV FDUULHUV LV
WKHLU HTXDO VXLWDELOLW\ IRU VXVSHQVLRQ WHOOV E\ HQWUDSPHQW  DQG DQFKRUDJHGHSHQGHQW FHOOV
KXJHVXUIDFHDUHD 

7KH SUREOHP ZLWK PDQ\ LPPRELOL]DWLRQ PDWHULDOV LV WKDW GLIIXVLRQ SDWKV EHFRPH WRR
ORQJSUHYHQWLQJVFDOHXS$VSKHUHLVLGHDOLQWKDWFHOOVDQGQXWULHQWVKDYHRQO\WRSHQHWUDWH
 RI WKH GLDPHWHU WR RFFXS\  RI WKH WRWDO YROXPH 7KLV IDFLOLWDWHV VFDOHXS DV HDFK

ϳϵ

VSKHUHZKHWKHULQDVWLUUHGIOXLGL]HGRUIL[HGEHGFXOWXUHFDQEHFRQVLGHUHGDQLQGLYLGXDO
PLQLELRUHDFWRU

)L[HGEHG 3RURVSKHUH 

7KHDSSDUDWXVDQGH[SHULPHQWDOSURFHGXUHVIRUVROLGVSKHUHVLVHTXDOO\VXLWHGWRSRURXV
6LUDQVSKHUHV 6FKRWW RIPPGLDPHWHU7KHRQO\GLIIHUHQFHVDUHWKDW WKHEHGVKRXOGEH
SDFNHG ZLWK RYHQGULHG VSKHUHV DQG WKH YRLG YROXPH RI FHOOV SOXV PHGLXP LQRFXODWHG  [
PO  GLUHFWO\ WR WKH EHG GU\ EHDGV SHUPLW EHWWHU SHQHWUDWLRQ RI FHOOV  $ ODUJHU PHGLXP
YROXPHLVUHTXLUHGDQGIDVWHUSHUIXVLRQUDWHV OLQHDUFPPLQ VKRXOGEHXVHG FHOOVDUH
SURWHFWHGIURPPHGLXPVKHDUZLWKLQWKHPDWUL[ HJOLWUHSDFNHGEHGQHHGVDWOHDVWD
OLWUHUHVHUYRLU$IWHUWKHLQLWLDOKSHULRGOLWUHVRIIUHVKPHGLXPLVDGGHGGDLO\

7KLVPHWKRGLVDORZLQYHVWPHQWLQWURGXFWLRQWRKLJKSURGXFWLYLW\SURGXFWLRQRIP$E
ZKLFK LV VLPSOH WR XVH DQG UHOLDEOH ZLWK ORZ PDLQWHQDQFH DW OHDVW IRU WKH ILUVW  GD\V RI
FXOWXUH



)LJXUH$6LUDQ 6FKRWW*ODVZHUNH SRURXVJODVVVSKHUH [PGLDPHWHU 

7DEOH3RURXVFDUULHUV²DGYDQWDJHVFRPSDUHGWRVROLGFDUULHUV
x 8QLWFHOOGHQVLW\WRIROGKLJKHU
x 6XSSRUWERWKDWWDFKHGDQGVXVSHQVLRQFHOOV
x ,PPRELOL]DWLRQLQ'FRQILJXUDWLRQHDVLO\DFKLHYHG
x 6KRUWGLIIXVLRQSDWKVLQWRDVSKHUH
x 6XLWDEOHIRUVWLUUHGIOWWLGL]HGRUIL[HGEHGUHDFWRUV
x *RRGVFDOHXSSRWHQWLDOE\FRPSDULVRQZLWKDQDORJRXVV\VWHPV HJPLFURFDUULHUDW
x OLWUH 
x &HOOVSURWHFWHGIURPVKHDU
x &DSDEOHRIORQJWHUPFRQWLQXRXVFXOWXUH



ϴϬ

)OXLGL]HGEHGV

3RURXVPLFURFDUULHUWHFKQRORJ\FXUUHQWO\WKHPRVWVXFFHVVIXOVFDOHXSPHWKRGIRUKLJK
GHQVLW\SHUIXVHGFXOWXUHVZDVSLRQHHUHGE\WKH9HUD[&RUSRUDWLRQ QRZ&HOOH[%LRVFLHQFHV
,QF  7XUQNH\ XQLWV ZHUH DYDLODEOH IURP  PO WR  OLWUHV IOXLGL]HG EHGV 7KH VPDOOHVW
V\VWHP LQ WKH UDQJH 9HUD[ 6\VWHP 2QH LV D EHQFKWRS FRQWLQXRXV SHUIXVLRQ IOXLGL]HG
ELRUHDFWRU VXLWDEOH IRU SURFHVV DVVHVVPHQW DQG GHYHORSPHQW DQG IRU ODERUDWRU\ VFDOH
SURGXFWLRQ RI P$EV &HOOV DUH LPPRELOL]HG LQ SRURXV FROODJHQ PLFURVSKHUHV ZHLJKWHG WR
JLYHDVSHFLILFJUDYLW\RIZKLFKDOORZVKLJKUHF\FOHIORZUDWHV W\SLFDOO\FPPLQ WR
JLYHHIILFLHQWIOXLGL]DWLRQ7KHPLFURVSKHUHVKDYHDVSRQJHOLNHVWUXFWXUHZLWKDSRUHVL]HRI
XPDQGLQWHUQDOSRUHYROXPHRIDOORZLQJLPPRELOL]DWLRQRIFHOOVWRGHQVLWLHVRI
;PO7KH\DUHIOXLGL]HGLQWKHIRUPRIVOXUU\

7KH9HUD[V\VWHPFRPSULVHVDELRUHDFWRU IOXLGL]DWLRQWXEH DFRQWUROV\VWHP IRUS+
R[\JHQ PHGLXP IORZ UDWHV  JDV DQG KHDW H[FKDQJHU DQG PHGLXP VXSSO\ DQG KDUYHVW
YHVVHOV 7KH V\VWHP LV UXQ FRQWLQXRXVO\ IRU ORQJ SHULRGV W\SLFDOO\ RYHU  GD\V  ,Q WKH
DXWKRU V ODERUDWRU\ LW SURGXFHG  [  FHOOVOLWUH DQG  PJ P$EOLWUHGD\ FRPSDUHG
WR LQ WKH IL[HG EHG GHVFULEHG DERYH  LQ D VWLUUHG UHDFWRU DQG  PJ LQ DQ DLUOLIW
IHUPHQWHU ,QVXPPDU\LWLVSUREDEO\WKHPRVWSURGXFWLYHV\VWHPDYDLODEOHJLYLQJWKHFHOOV
DYHU\KLJKVSHFLILFSURGXFWLRQUDWHEXWGRHVUHTXLUHVRPHVNLOOWRRSHUDWHWRLWVPD[LPXP
SRWHQWLDO
$QDOWHUQDWLYHFRPPHUFLDOV\VWHPLVWKH&\WRSLORW 3KDUPDFLD9RJHOEXVFK ZKLFKLVD
IOXLGL]HG V\VWHP XVLQJ SRO\HWK\OHQH FDUULHUV &\WROLQH  DQG VXSSRUWV  ;  FHOOVPO
FDUULHUV,WLVDYDLODEOHDVWKH&\WRSLORW0LQL POEHG IRUODERUDWRU\VFDOHRSHUDWLRQDV
ZHOODVVL]HVXSWROLWUHV7KHXQLWKDVDPDJQHWLFVWLUUHUWKDWGULYHVWKHPHGLXPXSWKURXJK
D GLVWULEXWLRQ SODWH LQWR WKH XSSHU FKDPEHU LQ ZKLFK WKH PLFURFDUULHUV DUH OLIWHG E\
K\GURG\QDPLF SUHVVXUH 7KH GHJUHH RI IOXLGL]DWLRQ LV FRQWUROOHG E\ WKH VWLUUHU VSHHG DQG D
FOHDUERXQGDU\OD\HULVNHSWDWWKHWRSRIWKHFXOWXUHVRWKDWFOHDUPHGLXPFDQIORZWKURXJK
WKHLQWHUQDOFHQWUDOFLUFXODWLRQWXEH ORRS EDFNWRWKHVWLUUHU7KHFXOWXUHLVR[\JHQDWHGE\D
PLQLVSDUJHUGHOLYHULQJPLFUREXEEOHVDQGDPHGLXPIHHGUDWHRIXSWREHGPDWUL[YROXPHV
SHUGD\JLYLQJKLJKSURGXFWLYLW\7KHXQLWFDQDOVREHXVHGDVDSDFNHGEHGELRUHDFWRULIWKH
FLUFXODWLRQ V\VWHP LV UHYHUVHG 7KHUH LV D UDQJHRI SRURXV PLFURFDUULHUV DYDLODEOH 7DEOH  
IRUIOXLGL]HGV\VWHPV$OWHUQDWLYHO\VRPHRIWKHFDUULHUVDUHGHVLJQHGIRUVWLUUHGFXOWXUHV

7DEOH&RPPHUFLDOO\DYDLODEOHSRURXV PLFUR FDUULHUV
&XOWXUH
7UDGHQDPH 6XSSOLHU 0DWHULDO 'ODP —P  PRGHD
&XOWLVSKHU* +\&ORQH *HODWLQ  )
    
&\WRFHOO 3KDUPDFLD &HOOXORVH  6
&HOOVQRZ .LULQ/WG &HOOXORVH  6
&\WROLQH 3KDUPDFLD 3RO\HWK\OHQH  )
,PPRED6LO $VKE\6FLHQWLILF 6LOLFRQHUXEEHU  6
0LFURVSKHUH &HOOH[%LRVFLHQFHV &ROODJHQ  )
6LUDQ 6FKRWW*ODVVZHUNH *ODVV  )
    ;
0LFURFDUULHU $VDKL&KHP,QG &HOOXORVH  6
D
6VWLUUHG)IOXLGL]HG;IL[HGEHG


ϴϭ

6WLUUHGFXOWXUHV

7KH &XOWLVSKHU* JHODWLQ  &HOOVQRZ FHOOXORVH  DQG ,PPRED6LO VLOLFRQH UXEEHU 
PLFURFDUULHUV DUH WKH PRVW VXLWHG WR VWLUUHG ELRUHDFWRUV DQG FDQ EH XVHG LQ DQ LGHQWLFDO
PDQQHU WR VROLG PLFURFDUULHUV LH  JOLWUH LQ VKDNH IODVNV VSLQQHU IODVNV RU VWLUUHG
IHUPHQWHUV7KHVLOLFRQHUXEEHURIWKH,PPRED6LOPLFURFDUULHUVIDFLOLWDWHV R[\JHQ GLIIXVLRQ
DQG WKLV RIIHUV D JUHDW DGYDQWDJH RYHU RWKHU IRUPXODWLRQV $ERXW D IROG KLJKHU
FRQFHQWUDWLRQ RI DWWDFKHG FHOOV DQG HYHQ JUHDWHU GHQVLWLHV RI VXVSHQVLRQ FHOOV FDQ EH
DFKLHYHG RYHU VROLG PLFURFDUULHUV 7KH FHOOV FDQ EH UHOHDVHG IURP WKH PLFURFDUULHUV E\
FROODJHQDVHWUHDWPHQW

5HIHUHQFHV

%HHNVPD , $ DQG .RPSLHU 5   ,Q $QLPDO FHOO WHFKQRORJ\ GHYHORSPHQWV WRZDUGV
WKHVW&HQWXU\ HG(&%HXYHU\-%*ULIILWKVDQG:3=HHLMOHPDNHU S
.OXZHU$FDGHPLF3XEOLVKHUV'RUGUHFKW
%HUJ*-DQG%RGHNHU*'  ,Q$QLPDOFHOOELRWHFKQRORJ\ HG5(6SLHUDQG-
%*ULIILWKV 9ROS$FDGHPLF3UHVV/RQGRQ
&DSVWLFN3%*DUODQG$@0DVWHUV5&DQG&KDSPDQ:*  ([S&HOO5HV

)DONHQEHUJ ) : :HLFKDUW + .UDQH 0 %DUWHOV , 3DOPH 0 1DJHOV +2 HW DO
 -,PPXQRO0HWKRGV
*RRG1(  %LRFKHPLVWU\
*ULIILWKV-%  'HY%LRO6WDQG
*ULIILWKV-%  ,Q$QLPDOFHOOELRWHFKQRORJ\ HG5(6SLHUDQG-%*ULIILWKV S
$FDGHPLF3UHVV/RQGRQ
*ULIILWKV-%  ,Q$QLPDOFHOOELRWHFKQRORJ\ HG5(6SLHUDQG-%*ULIILWKV 9RO
S$FDGHPLF3UHVV/RQGRQ
*ULIILWKV-%&DPHURQ'5DQG/RRE\'  'HY%LRO6WDQG
*ULIILWKV-%  -&HOO6FL
*ULIILWKV-%  &\WRWHFKQRORJ\
+DQDN-$-DQG'DYLV-0  ,Q&HOODQGWLVVXHFXOWXUHODERUDWRU\SURFHGXUHVHG
$ 'R\OH - % *ULIILWKV DQG ' * 1HZHOO  S ' -RKQ :LOH\  6RQV
&KLFKHVWHU
+D\WHU 3   ,Q &HOO DQG WLVVXH FXOWXUH ODERUDWRU\ SURFHGXUHV HG $ 'R\OH - %
*ULIILWKVDQG'1HZHOO 0RGXOH%-RKQ:LOH\ 6RQV&KLFKHVWHU
+HLGHPDQQ 5 5LHVH 8 /XWNH\PH\HU ' %XQWHPH\HU + DQG /HKPDQQ -  
&\WRWHFKQRORJ\
.UXVH3-.HHQ/1DQG:KLWWOH:/  ,Q9LWUR
/HLERYLW]$  $P-+\J
OLWZLQ-  'HY%LRO6WDQG
/RRE\ '   ,Q &HOO DQG WLVVXH FXOWXUH ODERUDWRU\ SURFHGXUHV HG $ 'R\OH - %
*ULIILWKVDQG'*1HZHOO S'-RKQ:LOH\ 6RQV&KLFKHVWHU
/RRE\'DQG*ULIILWKV-%  &\WRWHGPRORJ\
/RRE\ ' DQG *ULIILWKV - %   ,Q /DERUDWRU\ SURFHGXUHV LQ ELRWHFKQRORJ\ HG $
'R\OHDQG-%*ULIILWKV S-RKQ:LOH\ 6RQV&KLFKHVWHU
/RRE\'5DFKHU$-)XOOHU-3DQG*ULIILWKV-%  ,Q$QLPDOFHOOWHFKQRORJ\
GHYHORSPHQWVWRZDUGVWKHVW&HQWXU\ HG(&%HXYHU\-%*ULIILWKVDQG:3
=HHLMOHPDNHU S.OXZHU$FDGHPLF3XEOLVKHUV'RUGUHFKW
0DURXGDV1*  -7KHRU%LRO

ϴϮ

0HUFKXN-&DQG6LHJDO0+  -&KHP7HFKQRO%LRWHFKQRO
0RVPDQQ7  -,PPXQRO0HWKRGV
0XUDNDPL+   ,Q $GYDQFHV LQ ELRWHFKQRORJLFDO SURFHVVHV 9RO  S  $ODQ 5
/LVV1HZ<RUN
1LOVVRQ.DQG0RVEDFK.  )%%6,HWW
1LOVVRQ . 6FKHLUHU 0 0HUWHQ  : 2VWEHUJ / /LHKO ( DQG .DWLQJHU + : '
 1DWXUH
3DXO-DQG6WUXWKHUV0*  %LRFKHP%LRSK\V5HV&RPPXQ
3LUW6-DQG&DOORZ'6  ([S&HOO5HV
3URNRS$DQG5RVHQEHUJ0=  $GY%LRFKHP(QJ
5DFKHU$/RRE\'DQG*ULIILWKV@%  &\WRWHFKQRORJ\
5RQQLQJ 2   ,Q &HOO DQG WLVVXH FXOWXUH ODERUDWRU\ SURFHGXUHV HG $ 'R\OH - %
*ULIILWKVDQG'1HZHOO 0RGXOH&-RKQ:LOH\ 6RQV&KLFKHVWHU
5XQVWDGOHU 3 : -U 7XQJ $ 6 +D\PDQ ( * 5D\ 1 * 6DPSOH - 9 * DQG
'H/XFLD ' (   ,Q /DUJH VFDOH PDPPDOLDQ FHOO FXOWXUH WHFKQRORJ\ HG $ 6
/XELQLHFNL S0DUFHO'HNNHU1HZ<RUN
6LQJK 5 3 )DVVQDFKW ' 3HUDQL $ 6LPSVRQ 1 + *ROGHQ]RQ & 3RUWQHU 5 HW DO
 ,Q1HZGHYHORSPHQWVDQGQHZDSSOLFDWLRQVLQDQLPDOFHOOWHFKQRORJ\ HG2
: 0HUWHQ 3 3HUULQ DQG - % *ULIILWKV  S  .OXZHU $FDGHPLF 3XEOLVKHUV
'RUGUHFKW
6NRGD 5 3DNRV 9 +HUPDQQ $ 6SDWK 2 DQG -RKDQVVRQ $   'HY %LRO
6WDQG
6SLHU5(DQG*ULIILWKV@%  'HY%LRO6WDQG
6SLHU5(DQG:KLWHVLGH-3  'HY%LRO6WDQG
7RWK*0  ,Q&HOOFXOWXUHDQGLWVDSSOLFDWLRQV HG57$FWRQDQG@'/\QQ S
$FDGHPLF3UHVV1HZ<RUN
7RYH\0*  $GY&DQFHU5HV
7\R 0 $ %XOEXOLDQ % - 0HQNHQ % = DQG 0XUSK\ 7 -   ,Q $QLPDO FHOO
ELRWHFKQRORJ\ HG 5 ( 6SLHU DQG@ % *ULIILWKV  9RO  S  $FDGHPLF
3UHVV/RQGRQ
9DOOH0$.DXIPDQ-%HQWOH\:(DQG6KLORDFK-  ,Q1HZGHYHORSPHQWVDQG
QHZ DSSOLFDWLRQV LQ DQLPDO FHOO WHFKQRORJ\ HG 2: 0HUWHQ 3 3HUULQ DQG - %
*ULIILWKV S.OXZHU$FDGHPLF3XEOLVKHUV'RUGUHFKW
9DQ:H]HO$/  1DWXUH
:HLVV5(DQG6FKOHLWHU-%  %LRWHFK%LRHQJ
:KLWHVLGH-3DQG6SLHU5(  %LRWHFK%LRHQJ


ϴϯ

 
&KDSWHU
&HOOOLQHSUHVHUYDWLRQDQGDXWKHQWLFDWLRQ

,QWURGXFWLRQ

7KRXVDQGV RI GLIIHUHQW FHOO OLQHV KDYH EHHQ GHULYHG IURP KXPDQ DQG RWKHU UQHWD]RDQ
WLVVXHV0DQ\RIWKHVHRULJLQDWHIURPQRUPDOWLVVXHVDQGH[KLELWDGHILQDEOHOLPLWHGGRXEOLQJ
SRWHQWLDO 2WKHU FHOO OLQHV PD\ EH SURSDJDWHG FRQWLQXRXVO\ HLWKHU KDYLQJ JRQH WKURXJK DQ
HQJLQHHUHG RU VSRQWDQHRXV JHQHWLF FKDQJH IURP WKH QRUPDO SULPDU\ SRSXODWLRQ RU KDYLQJ
EHHQGHYHORSHGLQLWLDOO\IURPWXPRXUWLVVXH%RWKILQLWHOLQHVRIVXIILFLHQWGRXEOLQJSRWHQWLDO
DQG FRQWLQXRXV OLQHV FDQ EH H[SDQGHG WR SURGXFH D ODUJH QXPEHU RI DOLTXRWV IUR]HQ DQG
DXWKHQWLFDWHGIRUZLGHVSUHDGXVHLQUHVHDUFK

7KH DGYDQWDJHV RI ZRUNLQJ ZLWK D ZHOOGHILQHG FHOO OLQH IUHH IURP FRQWDPLQDWLQJ
RUJDQLVPV ZRXOG DSSHDU REYLRXV 8QIRUWXQDWHO\ KRZHYHU WKH SRWHQWLDO SLWIDOOV DVVRFLDWHG
ZLWK WKH XVH RI FHOO OLQHV REWDLQHG DQG SURFHVVHG FDVXDOO\ UHTXLUH UHSHDWHG HPSKDVLV
1XPHURXVRFFDVLRQVZKHUHFHOOOLQHVH[FKDQJHGDPRQJFRRSHUDWLQJODERUDWRULHVKDYHEHHQ
FRQWDPLQDWHGZLWKFHOOVRIRWKHUVSHFLHVKDYHEHHQGHWDLOHGDQGGRFXPHQWHGHOVHZKHUH)RU
H[DPSOHOLQHVVXSSRVHGWREHKXPDQKDYHEHHQIRXQGWREHPRQNH\PRXVHRUPRQJRRVH
ZKLOH RWKHUV WKRXJKW WR EH PRQNH\ RU PLQN ZHUH LGHQWLILHG DV UDW DQG GRJ 6LPLODUO\ WKH
SUREOHP RI LQWUDVSHFLHV FURVVFRQWDPLQDWLRQ DPRQJ FXOWXUHG KXPDQ FHOO OLQHV KDV EHHQ
UHFRJQL]HGIRURYHUWKLUW\\HDUVDQGGHWDLOHGUHYLHZVDUHDYDLODEOHRQWKHVXEMHFW7KHORVVRI
WLPH DQG UHVHDUFK IXQGV DV D UHVXOW RI WKHVH SUREOHPV LV LQFDOFXODEOH :KLOH EDFWHULDO DQG
IXQJDOFRQWDPLQDWLRQVUHSUHVHQWDQDGGHGFRQFHUQLQPRVWLQVWDQFHVWKH\DUHRYHUWDQGHDVLO\
GHWHFWHG DQG DUH WKHUHIRUH RI OHVV VHULRXV FRQVHTXHQFH WKDQ WKH PRUH LQVLGLRXV
FRQWDPLQDWLRQVE\P\FRSODVPD7KDWWKHSUHVHQFHRIWKHVHPLFURRUJDQLVPVLQFXOWXUHGFHOO
OLQHVRIWHQQHJDWHVUHVHDUFKILQGLQJVKDVEHHQVWDWHGUHSHDWHGO\+RZHYHUWKHSUHYDOHQFHRI
FRQWDPLQDWHG FXOWXUHV LQ WKH UHVHDUFK FRPPXQLW\ VXJJHVWV WKDW WKH SUREOHP FDQQRW EH
RYHUHPSKDVL]HG

&HOOOLQHEDQNLQJ

&HOO OLQHV SHUWLQHQW IRU DFFHVVLRQLQJ DUH VHOHFWHG E\ $7&& VFLHQWLVWV DQG DGYLVRUV
GXULQJUHJXODUUHYLHZVRIWKHOLWHUDWXUH7KHRULJLQDWRUVWKHPVHOYHVDOVRIUHTXHQWO\RIIHUWKH
OLQHV GLUHFWO\ IRU FRQVLGHUDWLRQ 'HWDLOHG LQIRUPDWLRQ ZLWK UHJDUG WR VSHFLILF JURXSV RI FHOO
OLQHVDFFHVVLRQHGLVDYDLODEOHHOVHZKHUH*HQHUDOO\VWDUWHUFXOWXUHVRUDPSRXOHVDUHREWDLQHG
IURPWKHGRQRUDQGSURJHQ\DUHSURSDJDWHGDFFRUGLQJWRLQVWUXFWLRQVWR\LHOGWKHILUVW WRNHQ 
IUHH]H &XOWXUHV GHULYHG IURP VXFK WRNHQ PDWHULDO DUH WKHQ VXEMHFWHG WR FULWLFDO
FKDUDFWHUL]DWLRQV ,I WKHVH WHVWV VXJJHVW WKDW IXUWKHU HIIRUWV DUH ZDUUDQWHG WKH PDWHULDO LV
H[SDQGHG WR SURGXFH VHHG DQG GLVWULEXWLRQ VWRFNV 1RWH HVSHFLDOO\ WKDW WKH PDMRU
DXWKHQWLFDWLRQHIIRUWVDUHDSSOLHGWRFHOOSRSXODWLRQVLQWKHLQLWLDOVHHGVWRFNRIDPSRXOHV7KH
GLVWULEXWLRQ VWRFN FRQVLVWV RI DPSRXOHV WKDW DUH GLVWULEXWHG RQ UHTXHVW WR LQYHVWLJDWRUV 7KH
UHIHUHQFH VHHG VWRFN &RQYHUVHO\ LV UHWDLQHG WR JHQHUDWH IXUWKHU GLVWULEXWLRQ VWRFNV DV WKH
LQLWLDOVWRFNEHFRPHVGHSOHWHG$OWKRXJKWKLVSURFHGXUHKDVEHHQGHYHORSHGWRVXLWWKHQHHGV
RI D ODUJH FHQWUDO UHSRVLWRU\ LW LV DOVR DSSOLFDEOH LQ VPDOOHU ODERUDWRULHV (YHQ ZKHUH WKH
QXPEHU RI FHOO OLQHVDQG XVHUV PD\ EHOLPLWHG LW LV LPSRUWDQWWR VHSDUDWH VHHG VWRFN  IURP
ZRUNLQJ RU GLVWULEXWLRQ VWRFN  2WKHUZLVH WKH IUHTXHQW UHSODFHPHQW RI FXOWXUHG PDWHULDO

ϴϰ

UHFRPPHQGHG WR SUHYHQW SKHQRW\SLF GULIW RU VHQHVFHQFH PD\ GHSOHWH YDOXDEOH VHHG VWRFN
ZKLFK PD\ EH GLIILFXOW DQG H[SHQVLYH WR UHSODFH 7KHVH YDULRXV VWHSV LQ WKH RYHUDOO
DFFHVVLRQLQJ VFKHPH DUH VXPPDUL]HG LQ )LJXUH  ,W LV LPSRUWDQW WR UHFRJQL]H WKDW WKH
FKDUDFWHUL]HG VHHG VWRFN VHUYHV DV D IUR]HQ UHVHUYRLU  IRU SURGXFWLRQ RI GLVWULEXWLRQ VWRFNV
RYHUWKH\HDUV%HFDXVHVHHGVWRFNDPSRXOHVDUHXVHGWRJHQHUDWHQHZGLVWULEXWLRQPDWHULDO
RQHFDQDVVXUHUHFLSLHQWVWKDWDOOWKHFXOWXUHVREWDLQHGFORVHO\UHVHPEOHWKRVHUHFHLYHGWHQRU
PRUH\HDUVSUHYLRXVO\7KLVLVDFULWLFDOFRQVLGHUDWLRQIRUGHVLJQRIFHOOEDQNLQJSURFHGXUHV
3UREOHPVDVVRFLDWHGZLWKJHQHWLFLQVWDELOLW\FHOOOLQHVHOHFWLRQVHQHVFHQFHRUWUDQVIRUPDWLRQ
PD\EHPLQLPL]HGRUDYRLGHGHQWLUHO\E\VWULFWDGKHUHQFHWRWKLVSULQFLSOH

,WLVSUXGHQWWRKDQGOHDOOSULPDU\WLVVXHVRUFHOOOLQHVQRWVSHFLILFDOO\VKRZQWREHIUHH
RIDGYHQWLWLRXVDJHQWVDVELRKD]DUGVLQD&ODVV,,YHUWLFDOODPLQDUIORZKRRG %61,+
6SHF   7KLV SUHFDXWLRQ SURWHFWV ERWK WKH FHOO FXOWXUH WHFKQLFLDQ DQG WKH ODERUDWRU\
IURPLQIHFWLRQRUFRQWDPLQDWLRQ6RPHUHFRPPHQGIXUWKHUPRUHWKDWDOOKXPDQWXPRXUOLQHV
EHWUHDWHGZLWKVLPLODUFDXWLRQGXHWRWKHNQRZQSUHVHQFHRIRQFRJHQHV



)LJXUH$FFHVVLRQLQJVFKHPHIRUQHZFHOOOLQHV6FKHPHLOOXVWUDWLQJDUHFRPPHQGHGSODQ
IRUWKHDFFHVVLRQRIFHOOOLQHVWREHEDQNHGIRUJHQHUDOGLVWULEXWLRQ$WOHDVWWKHILUVWWZRRI
WKH YDULRXV FKDUDFWHUL]DWLRQV LQGLFDWHG RQ WKH OHIWKDQG VLGH VKRXOG EH SHUIRUPHG EHIRUH
UHOHDVHRIDQ\FHOOOLQH

&HOOIUHH]LQJDQGTXDQWLWDWLRQRIUHFRYHU\

&HOOXODUGDPDJHLQGXFHGE\IUHH]LQJDQGWKDZLQJLVJHQHUDOO\EHOLHYHGWREHFDXVHGE\
LQWUDFHOOXODULFHFU\VWDOVDQGRVPRWLFHIIHFWV7KHDGGLWLRQRIDFU\RSURWHFWLYHDJHQWVXFKDV
GLPHWK\O VXOIR[LGH '062  RUJO\FHURODQG WKHVHOHFWLRQ RI VXLWDEOH IUHH]LQJ DQG WKDZLQJ
UDWHV PLQLPL]H FHOOXODU LQMXU\ :KLOH VKRUWWHUP VWRUDJH RI FHOO OLQHV XVLQJ PHFKDQLFDO
IUHH]HUV ƒ& LVSRVVLEOHVWRUDJHLQOLTXLGQLWURJHQ ƒ& RULWVYDSRXU WRƒ& LV
ϴϱ

PXFKSUHIHUUHG7KHXVHRIOLTXLGQLWURJHQUHIULJHUDWRUVLVDGYDQWDJHRXVQRWRQO\EHFDXVHRI
WKHORZHUWHPSHUDWXUHVDQGFRQVHTXHQWO\DOPRVWLQILQLWHVWRUDJHWLPHVSRVVLEOHEXWDOVRGXH
WR WKH WRWDO DEVHQFH RI ULVN RI PHFKDQLFDO IDLOXUHV DQG WKH SURORQJHG KROGLQJ WLPHV QRZ
DYDLODEOH &HUWDLQO\ IRU DOO EXW WKH VPDOOHVW FHOO OLQH EDQNLQJ DFWLYLW\ VWRUDJH LQ D OLTXLG
QLWURJHQUHIULJHUDWRULVHVVHQWLDO

7ZR FRQVLGHUDWLRQV RQ VDIHW\ LQ SURFHVVLQJ FHOO OLQHV UHTXLUH VSHFLDO HPSKDVLV )LUVW
WKHFHOOFXOWXUHWHFKQLFLDQPD\EHHQGDQJHUHGGXHWRWKHSRVVLELOLW\WKDWOLTXLGQLWURJHQFDQ
SHQHWUDWHDPSRXOHVYLDKDLUOLQHOHDNVGXULQJVWRUDJH2QZDUPLQJ UDSLG HYDSRUDWLRQ RI WKH
QLWURJHQZLWKLQWKHFRQILQHVRIVXFKDQDPSRXOHFDQFDXVHDVKDUSH[SORVLRQZLWKVKDWWHUHG
JODVV RUSODVWLFIO\LQJDWKLJK IRUFHDOPRVW LQVWDQWDQHRXVO\ LQ DOO GLUHFWLRQV)RUWXQDWHO\WKH
IUHTXHQF\RIVXFKWUDXPDWLFDFFLGHQWVGHFOLQHVGUDPDWLFDOO\DVWKHRSHUDWRUJDLQVH[SHULHQFH
LQDPSRXOHVHDOLQJDQGWHVWLQJ+RZHYHUHYHQZLWKKLJKO\DFFRPSOLVKHGODERUDWRU\ZRUNHUV
WKHUHPRWHSRVVLELOLW\RIH[SORVLRQVWLOOH[LVWV7KXVDSURWHFWLYHIDFHPDVNVKRXOGEHZRUQ
ZKHQHYHUDPSRXOHVDUHUHPRYHGIURPOLTXLGQLWURJHQVWRUDJHDQGXQWLOWKH\KDYHEHHQVDIHO\
RSHQHGLQWKHODPLQDUIORZKRRG6HFRQGO\'062FDQVROXELOL]HRUJDQLFVXEVWDQFHVDQGE\
YLUWXHRILWVSHQHWUDELOLW\WKURXJKUXEEHUDQGVNLQFDUU\WKHVHWRWKHFLUFXODWLRQ7KXVVSHFLDO
SUHFDXWLRQV VKRXOGEHH[HUFLVHGZKHQXVLQJ'062WRDYRLGFRQWDPLQDWLRQZLWK KD]DUGRXV
FKHPLFDOVDQGPLQLPL]HVNLQFRQWDFW

(TXLSPHQW
$PSRXOHVPDUNLQJDQGVHDOLQJGHYLFHV

$GHFLVLRQRQZKHWKHUWRXWLOL]HJODVVRUSODVWLFDPSRXOHVZLOOGHSHQGRQWKHVFDOHRI
RSHUDWLRQDQGWKHH[WHQWRIDQWLFLSDWHGGLVWULEXWLRQ*ODVVDPSRXOHVFDQEHVWHULOL]HGORDGHG
ZLWK WKH DSSURSULDWH FHOO VXVSHQVLRQ DQG SHUPDQHQWO\ VHDOHG LQ FRPSDUDWLYHO\ ODUJH
TXDQWLWLHV7KH\DUHUHFRPPHQGHGIRUODUJHORWVRIFHOOV DPSRXOHVRUPRUH DUHSUHSDUHG
IRU ORQJWHUP XVH RU JHQHUDO GLVWULEXWLRQ 6PDOOHU QXPEHUV   RI SODVWLF DPSRXOHV DUH
HDVLHUWKDQJODVVWRKDQGOHPDUNDQGVHDO3UREOHPVZLWKWKHVHDOPD\RFFXULQVRPHFDVHV
KRZHYHU HVSHFLDOO\ LI IUHTXHQW KDQGOLQJ RU PDQLSXODWLRQV IRU VKLSPHQW DUH QHFHVVDU\ 7KH
PDUNLQJRIDPSRXOHVUHTXLUHVVSHFLDOFRQVLGHUDWLRQLQWKDW OHJLELOLW\FDQHDVLO\EHREVFXUHG
DVWKHDPSRXOHVDUHIUR]HQVQDSSHGRQDQGRIIVWRUDJHFDQHVWUDQVIHUUHGEHWZHHQIUHH]HUVRU
VKLSSLQJ FRQWDLQHUV DQG VR IRUWK 7KH XVH RI SDSHU ODEHOV EDOOSRLQW SHQ RU VWDQGDUG
ODERUDWRU\ PDUNHUV DOO DUH SUREOHPDWLFDO DQG WKLV LV HVSHFLDOO\ WUXH ZLWK JODVV DPSRXOHV
7KHVHVKRXOGEHODEHOOHGLQDGYDQFHZLWKFHUDPLFLQNWKDWFDQEHKHDWDQQHDOHGWRWKHJODVV
VXUIDFH7KHPDUNLQJVFDQEHDSSOLHGE\KDQGZLWKDVWUDLJKWSHQRULIODUJHORWVDUHEHLQJ
SURFHVVHG WKURXJK XVH RI D PHFKDQLFDO ODEHOOHU HJ IURP 0DUNHP &R .HHQH 1HZ
+DPSVKLUH 

*ODVVDPSRXOHVFDQEHVWEHVHDOHGE\SXOOLQJRQWKHQHFNRIWKHDPSRXOHDVLWLVURWDWHG
LQ WKH KLJKHVW KHDW ]RQH RI WKH IODPH IURP D JDVR[\JHQ WRUFK 7KLV SXOOVHDO WHFKQLTXH LV
SUHIHUUHGEHFDXVHLWUHGXFHVWKHULVNRISHUPLWWLQJSLQKROHOHDNVLQWKHVHDOHGWLS7RUFKHVIRU
PDQXDOVHDOLQJFDQEHREWDLQHGIURPVFLHQWLILFVXSSO\KRXVHV)RUODUJHORWVDWRUFKFDQEH
DWWDFKHG WR D VHPLDXWRPDWLF VHDOLQJ GHYLFH DYDLODEOH DV %HQFK VHDOHU PRGHO  IURP
0RUJDQ6KHHW0HWDO&R6DUDVRWD)/86$

6ORZIUHH]LQJDSSDUDWXV

7KH RSWLPXP IUHH]LQJ UDWH IRU FHOO OLQHV IRU PRVW FHOOV DERXW  ƒ&PLQ  FDQ EH
DFKLHYHGWKURXJKXVHRIDSSDUDWXVYDU\LQJLQFRPSOH[LW\IURPDWDLORUPDGHVW\URIRDPER[WR

ϴϲ

DFRPSOHWHO\SURJUDPPDEOHIUHH]LQJXQLW7KHIRUPHUVKRXOGKDYHDZDOOWKLFNQHVVRIDERXW
FP WR DSSUR[LPDWH WKH  ƒ& FRROLQJ UDWH ZKHQ SODFHG LQ D PHFKDQLFDO IUHH]HU DW  ƒ&
$OWHUQDWLYHO\PDQXIDFWXUHUVRIOLTXLGQLWURJHQUHIULJHUDWRUVVXSSO\DGDSWHGUHIULJHUDWRUQHFN
SOXJVDWPRGHVWFRVWZKLFKFDQEHDGMXVWHGIRUVORZIUHH]LQJRIQXPEHUVRIDPSRXOHV)RU
WKRVH ZKR SURGXFH ODUJHU TXDQWLWLHV RI DPSRXOHV DQG UHTXLUH PRUH SUHFLVH FRQWURO RI WKH
IUHH]LQJ UDWH D FRQWUROOHG UDWH IUHH]HU HJ &U\R0HG 3ODQHU 8QLRQ &DUELGH  VKRXOG EH
FRQVLGHUHG

/LTXLGQLWURJHQUHIULJHUDWRUV

&KRLFH RI DQ DSSURSULDWH UHIULJHUDWRU ZLOO UHTXLUH FRQVLGHUDWLRQV RI HFRQRP\ ERWK LQ
WHUPVRIOLTXLGQLWURJHQFRQVXPSWLRQDQGLQLWLDORXWOD\VWRUDJHFDSDFLW\UHTXLUHGDQGGHVLUHG
HDVH RI HQWU\ DQG UHWULHYDO )UHH]HUV ZLWK QDUURZHU QHFN WXEH RSHQLQJV DUH JHQHUDOO\ PRUH
HFRQRPLFDO

$PSRXOHVRIFHOOVPD\EHVWRUHGLPPHUVHGLQOLTXLGQLWURJHQRULQ WKH YDSRXUSKDVH
7KHODWWHUKDVWKHDGYDQWDJHWKDWDPSRXOHVZLWKSLQKROHOHDNVZLOOQRWEHH[SRVHGWROLTXLG
VRWKHGDQJHURIH[SORVLRQLVHOLPLQDWHG7KHVOLJKWO\KLJKHUWHPSHUDWXUHSUREDEO\RIIHUVQR
GLVDGYDQWDJHH[FHSWSHUKDSVZLWKVHHGVWRFNVUHWDLQHGIRUH[WUHPHO\ORQJSHULRGV

8VHIXO DFFHVVRULHV IRU UHIULJHUDWRUV LQFOXGH UROOHU EDVHV IRU HDVH RI PRYHPHQW DODUP
V\VWHPV WR ZDUQ RI GDQJHURXVO\ ORZ OHYHOV RI OLTXLG QLWURJHQ DQG UDFNLQJ V\VWHPV ZLWK
ODUJHUUHIULJHUDWRUVIRUUHDG\VWRUDJHDQGUHFRYHU\(YHQZKHQDQDXWRPDWLFDODUPV\VWHPLV
XVHG WKLV VKRXOG EH EDFNHGXS ZLWK D UHJXODU PDQXDO FKHFN XVLQJ D GLSVWLFN (OHFWURQLF
V\VWHPV FDQ IDLO DQG LW KDV EHHQ NQRZQ IRU ERWK WKH DXWRPDWLF ILOO V\VWHP DQG LWV EDFNXS
DODUPWRIDLO

3UHSDUDWLRQDQGIUHH]LQJ

&XOWXUHVLQWKHODWHORJDULWKPLFRUMXVWSUHFRQIOXHQWSKDVHRIJURZWKVKRXOGEHVHOHFWHG
WR JLYH WKH KLJKHVW SRVVLEOH LQLWLDO YLDELOLW\ 7UHDW WKH FXOWXUHV ZLWK WU\SVLQ LI QHFHVVDU\ WR
SURGXFHDXQLIRUPVLQJOHFHOOVXVSHQVLRQDVLIIRUURXWLQHVXEFXOWLYDWLRQDQGSURFHHG

5HFRQVWLWXWLRQDQGTXDQWLWDWLQJUHFRYHU\

5DSLG WKDZLQJ RI WKH FHOO VXVSHQVLRQ LV HVVHQWLDO IRU RSWLPDO UHFRYHU\ D YDULHW\ RI
PHWKRGV PD\ EH XVHG WR TXDQWLWDWH FHOO UHFRYHU\ DIWHU IUHH]LQJ 2I FRXUVH WKLV LV WKH ILUVW
FKDUDFWHUL]DWLRQVWHSWREHSHUIRUPHGDIWHUSUHVHUYDWLRQ

'\HH[FOXVLRQIRUTXDQWLWDWLQJFHOOYLDELOLW\

$YHU\DSSUR[LPDWHHVWLPDWHRIWKHYLDELOLW\RIFHOOVLQDVXVSHQVLRQPD\EHREWDLQHG
E\WKHG\HH[FOXVLRQWHVW$VROXWLRQRUWKHG\HLQVDOLQHLVDGGHGWRWKHVXVSHQVLRQDQGWKH
SHUFHQWDJH RI FHOOV ZKLFK GR QRW WDNH XS WKH VWDLQ LV GHWHUPLQHG E\ GLUHFW FRXQW XVLQJ D
KDHPRFUYWRPHWHU 7L\SDQ EOXH RU HU\WKURFLQ % DUH WKH VWDLQV PRVW FRPPRQO\ XVHG IRU WKLV
SURFHGXUH7KH IRUPHUUHSRUWHGO\ KDV D KLJKHU DIILQLW\ IRU SURWHLQ LQ VROXWLRQ WKDQIRU QRQ
YLDEOHFHOOV 7KLV PD\ UHGXFHWKH DFFXUDF\ RI WKH HVWLPDWH LI WKH VXVSHQVLRQ FRQWDLQV PXFK
PRUH WKDQ   VHUXP )XUWKHUPRUH EHFDXVH VROXWLRQV RI HU\WKURFLQ % DUH FOHDU PLFURELDO
JURZWKRUSUHFLSLWDWHVDUHLPPHGLDWHO\DSSDUHQW7KLVLVQRWWUXHIRUVWRFNVROXWLRQVRIWU\SDQ
EOXH

ϴϳ

&RORQ\IRUPLQJHIILFLHQF\

7KH G\H H[FOXVLRQ WHVW IRU FHOO YLDELOLW\ JHQHUDOO\ RYHUHVWLPDWHV UHFRYHU\ )RU OLQHV
FRQVLVWLQJ RI DGKHUHQW FHOOV WKH FRORQ\IRUPLQJ DELOLW\ RI FHOOV IURP WKH UHFRQVWLWXWHG
SRSXODWLRQ UHSUHVHQWV DPRUH DFFXUDWH RYHUDOO HVWLPDWH RI VXUYLYDO 2IFRXUVH WKH FKRLFHRI
JURZWKPHGLXPXVHGWKHVXEVWUDWHRQZKLFKWKHFRORQLHVGHYHORSDQGWKHLQFXEDWLRQWLPHDOO
PD\ KDYH DQ HIIHFW RQ WKH HQGUHVXOW 7KXV IRU FRPSDULVRQV DPRQJ GLIIHUHQW IUHH]HV
FRQGLWLRQVIRUVHOHFWHGOLQHVPXVWEHVWDQGDUGL]HG

3UROLIHUDWLRQLQPDVVFXOWXUH

7KHYLWDOLW\RIUHFRQVWLWXWHGFHOOVIURPHLWKHUDGKHUHQWRUQRQDGKHUHQWOLQHVFDQDOVREH
GRFXPHQWHG E\ VLPSO\ TXDQWLWDWLQJ SUROLIHUDWLRQ GXULQJ WKH LQLWLDO RQH WR WZR ZHHNV DIWHU
UHFRYHU\IURPOLTXLGQLWURJHQ

&HOOOLQHDXWKHQWLFDWLRQV

,QDGGLWLRQWRUHFRYHUDELOLW\IURPOLTXLGQLWURJHQWKHDEVROXWHPLQLPXPUHFRPPHQGHG
DXWKHQWLFDWLRQVWHSVLQFOXGHYHULILFDWLRQRIVSHFLHVDQGGHPRQVWUDWLRQWKDWWKHFHOOOLQHLVIUHH
RIEDFWHULDOIXQJDORUP\FRSODVPDOFRQWDPLQDWLRQ

6SHFLHVYHULILFDWLRQ

6SHFLHV RI RULJLQ FDQ EH GHWHUPLQHG IRU FHOO OLQHV XVLQJ LVRHQ]\PH SURILOHV RU E\
F\WRJHQHWLFV7KHVHWZRPHWKRGVDUHXVHGDW$7&&

,VRHQ]\PHSURILOHV

,VR]\PHDQDO\VHV SHUIRUPHG RQKRPRJHQDWHV RIFHOO OLQHV IURP RYHU  VSHFLHV KDYH
GHPRQVWUDWHG WKH XWLOLW\ RI WKLV ELRFKHPLFDO FKDUDFWHULVWLF IRU VSHFLHV YHULILFDWLRQ %\
GHWHUPLQLQJWKHPRELOLWLHVRIPXOWLSOHLVR]\PHV\VWHPVRQHFDQLGHQWLI\WKHVSHFLHVRIRULJLQ
RI FHOO OLQHV ZLWK D KLJK GHJUHH RI FHUWDLQW\ 7KH SURFHGXUHV DUH UHODWLYHO\ VWUDLJKWIRUZDUG
SURYLGH FRQVLVWHQW UHVXOWV DQG GR QRW UHTXLUH H[SHQVLYH HTXLSPHQW $ NLW $XWKHQWL.LWŒ
,QQRYDWLYH&KHPLVWU\,QF KDVEHHQGHYHORSHGIRUWKLVSXUSRVH3UHFDVWDJDURVHJHOVRQ
D SRO\VW\UHQH ILOP EDFNLQJ EXIIHUV HQ]\PH VXEVWUDWHV ZLWK VWDELOL]HUV DQG DSSURSULDWH
FRQWURO H[WUDFWV DUH DYDLODEOH 6SHFLDOO\ FRQVWUXFWHG HOHFWURSKRUHWLF FKDPEHUV DUH XWLOL]HG
DIWHU FRXSOLQJ WR SRZHU VXSSOLHV 2YHU  GLIIHUHQW HQ]\PH V\VWHPV FDQ EHHYDOXDWHG 7KH
DGYDQWDJHV RI WKH NLW LQFOXGH WKH FRQYHQLHQFH RI UHDG\PDGH JHOV DQG UHDJHQWV SOXV WKH
VLJQLILFDQWO\ORZHUWLPHVUHTXLUHGIRUHOHFWURSKRUHWLFVHSDUDWLRQV PLQ $IWHUGU\LQJ
WKHJHOVFDQEHUHWDLQHGWRGRFXPHQWFHOOOLQHFKDUDFWHULVWLFV )LJXUH 

&\WRJHQHWLFV

.DU\RORJLFWHFKQLTXHVKDYHEHHQXVHGWRPRQLWRUIRULQWHUVSHFLHVFRQWDPLQDWLRQDPRQJ
FHOOOLQHV,QPDQ\LQVWDQFHVWKHFKURPRVRPDOFRQVWLWXWLRQVDUHVRGUDPDWLFDOO\GLIIHUHQWWKDW
HYHQFXUVRU\PLFURVFRSLFREVHUYDWLRQVDUHDGHTXDWH,QRWKHUVDV IRUH[DPSOHFRPSDULVRQV
DPRQJFHOOOLQHVIURPFORVHO\UHODWHGSULPDWHVFDUHIXOHYDOXDWLRQRIEDQGHGSUHSDUDWLRQVLV
UHTXLUHG
7KH VWDQGDUG PHWKRG LQYROYHV WKH VZHOOLQJ RI PHWDSKDVHDUUHVWHG FHOOV E\ EULHI
H[SRVXUHWRK\SRWRQLFVDOLQH 7DEOH 7KHFHOOVDUHWKHQIL[HGDSSOLHGWRVOLGHVWRRSWLPL]H

ϴϴ

VSUHDGLQJVWDLQHGDQGPRXQWHGIRUPLFURVFRSLFREVHUYDWLRQ7KHIUHTXHQF\RILQWURGXFWLRQ
RI DUWHIDFWV WKURXJK WKLV PHWKRG ZLOO YDU\ GHSHQGLQJ XSRQ WKH FHOO OLQH DQG WKH GHJUHH RI
H[SHULHQFH 5XSWXULQJ RI FHOOV ZLOO RFFXU IRU H[DPSOH DQG DSSDUHQW ORVVHV RU JDLQV LQ
FKURPRVRPHVZLOOUHVXOW

+RZHYHU E\ FRXQWLQJ WKH FKURPRVRPHV LQ  ZHOOVSUHDG PFWDSKDVHV DQG
UHFRUGLQJ WKH PRGDO QXPEHU WKH F\WRJHQHWLFLVW FDQ REWDLQ D UHOLDEOH HVWLPDWH IRU D VSHFLILF
OLQH



)LJXUH  ,VRHQ]\PH JHW $Q DJDURVH JHO SURFHVVHG IRU JLXFRVHSKRVSKDWH
GHK\GURJHQDVHXVLQJWKH$XWKHQWL.LWŒ7KHJHOZDV ORDGHGZLWKH[WUDFWVIURPPXULQHDQG
KXPDQFHOOVSOXVRQHPXULQHKXPDQPL[WXUH/DQHVLQWKHOHIWVHFWLRQ /+6 DQGDQGLQ
WKHULJKWVHFWLRQ 5+6 DUHKXPDQ/DQHVDQG /+6 DQG 5+6 DUHIURPH[WUDFWVRI
PXULQHOLQHV/DQH 5+6DQGDUUDLY LVIURPWKHPL[HGOLQH

7DEOH6WRFNVROXWLRQVIRUURXWLQHNDU\RORJ\
&ROFHPLG VWRFN  PJ PO GRXEOH JODVV GLVWLOOHG ZDWHU '*':  VWRUH IUR]HQ LQ VPDOO
DOLTXRWV
.&O0LQ'*':
)L[DWLYH  SDUWV DQK\GURXV PHWK\O DOFRKRO  SDUW JODFLDO DFHWLF DFLG FRPELQH MXVW EHIRUH
XVH 
$FHWLFRUFHLQVWDLQJQDWXUDORUFHLQGLVVROYHGLQPORIDFHWLFDFLG
*LHPVDVWDLQLQ0SKRVSKDWHEXIIHUDWS+ VROXWLRQDYDLODEOHFRPPHUFLDOO\ 



ϴϵ

 7KHNDU\RW\SHLV FRQVWUXFWHG E\ FXWWLQJ FKURPRVRPHV IURP DSKRWRPLFURJUDSKHLWKHU
PDQXDOO\RUXVLQJDVRIWZDUHSDFNDJHDQGDUUDQJLQJWKHPDFFRUGLQJWRDUPOHQJWKSRVLWLRQ
RI FHQWURPHUH SUHVHQFH RI VHFRQGDU\ FRQVWULFWLRQV DQG VR IRUWK &RQVXOW WKH $WODV RI
PDPPDOLDQFKURPRVRPHVIRUH[DPSOHVRIFRQYHQWLRQDOO\VWDLQHGSUHSDUDWLRQVIURPRYHU
VSHFLHV )RU D PRUH FULWLFDO NDU\RW\SLF DQDO\VLV FKURPRVRPH EDQGLQJ WHFKQLTXHV DUH
UHTXLUHG

7HVWVIRUPLFURELDOFRQWDPLQDWLRQ

7KHWHVWVLQFOXGHGKHUHDUHVXLWDEOHIRUGHWHFWLRQRIPRVWPLFURRUJDQLVPVWKDWZRXOG
EHH[SHFWHGWRVXUYLYHDVFRQWDPLQDQWVLQFHOOOLQHVRUFXOWXUHIOXLGV7HFKQLTXHVIRUGHWHFWLQJ
SURWR]RDQFRQWDPLQDWLRQDUHQRWSUHVHQWHGDVWKHVHRUJDQLVPVDUHUDUHO\IRXQGLQFRQWLQXRXV
OLQHVDQGGHVFULSWLRQVRIWKHPHWKRGRORJ\DUHDYDLODEOHHOVHZKHUH&RPPHUFLDOGU\SRZGHUV
DUH HQWLUHO\ VDWLVIDFWRU\ IRU SUHSDUDWLRQ RI WHVW PHGLD IRU EDFWHULD IXQJL DQG P\FRSODVPD
SURYLGHGWKDWSRVLWLYHFRQWUROVDUHLQFOXGHGDWOHDVWZLWKWKHLQLWLDOWULDOVRQHDFKORWREWDLQHG

'HWHFWLRQRIEDFWHULDDQGIXQJL

7R H[DPLQH FHOO FXOWXUHV RU VXVSHFW PHGLD IRU EDFWHULDO RU IXQJDO FRQWDPLQDQWV
0LFURVFRSLF H[DPLQDWLRQ LV RQO\ VXIILFLHQW IRU GHWHFWLRQ RI JURVV FRQWDPLQDWLRQV DQG HYHQ
VRPH RI WKHVH FDQQRW EH UHDGLO\ GHWHFWHG E\ VLPSOH REVHUYDWLRQ 7KHUHIRUH DQ H[WHQVLYH
VHULHVRIFXOWXUHWHVWVLVDOVRUHTXLUHGWRSURYLGHUHDVRQDEOHDVVXUDQFHWKDWDFHOOOLQHVWRFNRU
PHGLXPLVIUHHRIIXQJLDQGEDFWHULD

0\FRSODVPDGHWHFWLRQ

&RQWDPLQDWLRQRIFHOOFXOWXUHVE\P\FRSODVPDFDQEHDPXFKPRUHLQVLGLRXVSUREOHP
WKDQ WKDW FUHDWHG E\ JURZWK RI EDFWHULD RU IXQJL :KLOH WKH SUHVHQFH RI VRPH P\FRSODVPD
VSHFLHV PD\ EH DSSDUHQW GXH WR WKH GHJHQHUDWLYH HIIHFWV LQGXFHG RWKHUV PHWDEROL]H DQG
SUROLIHUDWHDFWLYHO\LQWKH FXOWXUH ZLWKRXW SURGXFLQJ DQ\ RYHUW PRUSKRORJLFDOFKDQJHLQWKH
FRQWDPLQDWHG FHOO OLQH 7KXV FHOO FXOWXUH VWXGLHV UHODWLQJ WR PHWDEROLVP VXUIDFH UHFHSWRUV
YLUXVKRVW LQWHUDFWLRQV DQG VR IRUWK DUH FHUWDLQO\ VXVSHFW LI QRW QHJDWHG LQ LQWHUSUHWDWLRQ
HQWLUHO\ZKHQFRQGXFWHGZLWKFHOOOLQHVKDUERXULQJP\FRSODVPD1LQHJHQHUDOPHWKRGVDUH
DYDLODEOHIRUGHWHFWLRQRIP\FRSODVPDFRQWDPLQDWLRQ7KHGLUHFWFXOWXUHWHVWDVHQVLWLYH3&5
DQDO\WLFDO NLW DQG WKH LQGLUHFW  WHVW HPSOR\LQJ D ELVEHQ]LPLGD]ROH IOXRURFKURPH VWDLQ
+RHFKVW IRU'1$DUHXVHGURXWLQHO\DWWKH$7&&WRFKHFNLQFRPLQJFHOOOLQHVDQG
DOO WHOO GLVWULEXWLRQ VWRFNV IRU P\FRSODVPD 7KH VHUXP \HDVW H[WUDFW DQG RWKHU LQJUHGLHQWV
XVHGIRUP\FRSODVPDLVRODWLRQDQGSURSDJDWLRQVKRXOGEHSUHWHVWHGIRUDEVHQFHRIWR[LFLW\
DQG IRU JURZWKSURPRWLQJ SURSHUWLHV EHIRUH XVH 3RVLWLYH FRQWUROV FRQVLVWLQJ RI 0DUJLQLP
0RUDOH DQG $ ODLGODZLL DUH UHFRPPHQGHG EHFDXVH WKH\ DUH DPRQJ WKH PRVW SURPLQHQW
VSHFLHVLVRODWHGIURPFXOWXUHGFHOOV


ϵϬ

 
)LJXUH0\FRSODVPDFRORQLHV0LFURSKRWRJUDSKVKRZLQJFRORQLHVRIP\FRSODVPDLQDJDU
SODWH 7KH VPDOOHU PDWHULDO EHWZHHQ FRORQLHV LV IURP WKH LQRFXOXP RI FXOWXUHG FHOOV DQG
GHEULV

7DEOH  6XJJHVWHG UHJLPHQ IRU GHWHFWLQJ EDFWHULDO RU IXQJDO FRQWDPLQDWLRQ LQ FHOO
FXOWXUHV
7HPSHUDWXUH $HURELF
7HVWPHGLXP ƒ&  VWDWH 2EVHUYDWLRQWLPH GD\V 
%ORRGDJDUZLWKIUHVK  $HURELF 
GHILEULQDWHGUDEELWEORRG    $QDHURELF 
7KLRJO\FROODWHEURWK  $HURELF 
   
7U\SWLFDVHVR\EURWK  $HURELF 
   
%UDLQKHDUWLQIXVLRQEURWK  $HURELF 
   
6DERXUDXGEURWK  $HURELF 
   
<0EURWK  $HURELF 
   
1XWULHQWEURWKZLWK\HDVW  $HURELF 
H[WUDFW   

$VPDQ\VWUDLQVRIP\FRSODVPDHVSHFLDOO\0K\RUKLQLVDUHGLIILFXOWRULPSRVVLEOHWR
FXOWLYDWH LQ DUWLILFLDO PHGLD DQ LQGLUHFW  WHVW PHWKRG VKRXOG DOVR EH LQFOXGHG 3RVLWLYH DQG
QHJDWLYHFRQWUROVVKRXOGEHLQFOXGHGZLWKHDFKWHVWVHULHV)RUWKLVLQGLUHFWWHVWWKH9HURRU
7FHOOVLQRFXODWHGZLWKPHGLXPRQO\VHUYHDVQHJDWLYHFRQWUROV0K\RUKLQLV0DUJPLQL
0 RUDOH DQG $ ODLGODZWL DUH VXLWDEOH FRQWUROV ZLWK WKH RUGHU RI SUHIHUHQFH DV OLVWHG 7KH
QXFOHLFDFLGRI WKH RUJDQLVPV LV YLVLEOH DV SDUWLFXODWHRUILEULOODUPDWWHURYHUWKHF\WRSODVP
ZLWKWKHFXOWXUHGFHOOQXFOHLPRUHSURPLQHQW )LJXUH :LWKKHDY\LQIHFWLRQVLQWHUFHOOXODU
VSDFHVDOVRVKRZVWDLQLQJ


ϵϭ

 

)LJXUH  +RHFKVW VWDLQLQJ RI P\FRSODVPD 0LFURSKRWRJUDSK VKRZLQJ P\FRSODVPDO '1$
GHPRQVWUDWHGE\+RHFKVWVWDLQLQJ7KHODUJHUIOXRUHVFLQJERGLHVDUH QXFOHL RI WKH VXEVWUDWH
FHOOOLQH9HUR


3UHSDUDWLRQRISRVLWLYHFRQWUROVLHGHOLEHUDWHO\LQIHFWLQJFXOWXUHVFUHDWHVDSRWHQWLDO
KD]DUGWRRWKHUVWRFNVVRLQIHFWHGFXOWXUHVVKRXOGEHSUHSDUHGDWDWLPHZKHQRULQDSODFH
ZKHUHRWKHUFXOWXUHVZLOOQRWEHDWULVN)L[DQGVWRUHSRVLWLYHFRQWUROVDWR&RYHUGHVLFFDQW
XQWLOUHTXLUHG,QDOOTXDOLW\FRQWUROZRUNZLWKP\FRSODVPDRUXQNQRZQFXOWXUHVLWLVSUXGHQW
WRZRUNLQDYHUWLFDOODPLQDUIORZKRRGSUHIHUDEO\LVRODWHGIURPRWKHUVWDQGDUGFHOOFXOWXUH
DFWLYLW\2QHVKRXOGEHDZDUHFRQWLQXDOO\ RIWKH GDQJHURIFRQWDPLQDWLQJ FOHDQFXOWXUHV E\
DHURVROV IURP P\FRSODVPDFRQWDLQLQJ FXOWXUHV PDQLSXODWHG LQ WKH VDPH DUHD RU PDQXDOO\
GXULQJSURFHVVLQJRIPXOWLSOHFXOWXUHIODVNV$SSURSULDWHGLVLQIHFWLRQEHWZHHQXVHVRIDKRRG
RUZRUNDUHDLVVWURQJO\UHFRPPHQGHG

9DULRXVSRO\PHUDVHFKDLQUHDFWLRQ 3&5 WHVWVIRUP\FRSODVPDKDYHEHHQGHYHORSHG
LQFOXGLQJWKRVHXVHGDW$7&&(LJKWFRPPRQO\HQFRXQWHUHGP\FRSODVPDFRQWDPLQDQWVFDQ
EH GHWHFWHG 0 DUJLQLQL 0 IHUPFQWDQV 0 KRPLPV 0K\RUKLPV 0 RUDN 0 SLUXP 0
VGLYDULXP DQG $FKROHSODVPD ODLGODZLL ZKLFK DFFRXQW IRU PRUH WKDQ  RI P\FRSODVPD
FRQWDPLQDQWVLQFHOOFXOWXUHV0\FRSODVPD'1$LQSODQWVDQGLQVHFWVFDQDOVREHGHWHFWHG
7KH DPSOLILFDWLRQ SURGXFW FDQ EH XVHG WR LGHQWLI\ WKH VSHFLHV RI P\FRSODVPD E\ VL]H
GHWHUPLQDWLRQDQGUHVWULFWLRQHQ]\PHGLJHVWLRQ

7HVWLQJIRUWKHSUHVHQFHRIYLUXVHV

2IWKHYDULRXVWHVWVDSSOLHGIRUGHWHFWLRQRIDGYHQWLWLRXVDJHQWVDVVRFLDWHGZLWKFXOWXUHG
FHOOV WKRVH IRU HQGRJHQRXV DQG FRQWDPLQDQW YLUXVHV DUH WKH PRVW SUREOHPDWLFDO
'HYHORSPHQW RI DQ RYHUW DQG FKDUDFWHULVWLF F\WRSDWKRJHQLF HIIHFW &3(  ZLOO FHUWDLQO\
SURYLGHDQHDUO\LQGLFDWLRQRIYLUDOFRQWDPLQDWLRQ7KHDEVHQFHRI&3(KRZHYHUGHILQLWHO\
GRHVQRWLQGLFDWHWKDWWKHFXOWXUHLVYLPVIUHH,QIDFWSHUVLVWHQWRUODWHQWLQIHFWLRQVPD\H[LVW
LQ FHOO OLQHV DQG UHPDLQ XQGHWHFWHG XQWLO WKH DSSURSULDWH ELRORJLFDO LPPXQRORJLFDO
F\WRORJLFDOXOWUDVWUXFWXUDODQGRUELRFKHPLFDOWHVWVDUHDSSOLHG$GGLWLRQDOKRVWV\VWHPVRU
PDQLSXODWLRQV IRU H[DPSOH WUHDWPHQW ZLWK KDORJHQDWHG QXFOHRVLGHV PD\ EH UHTXLUHG IRU
YLUXV DFWLYDWLRQ DQG LVRODWLRQ 0ROHFXODU WHFKQLTXHV IRU GHWHFWLRQ DQG LGHQWLILFDWLRQ RI

ϵϮ

VSHFLILFYLUDOLQIHFWLRQVPD\EHGLDJQRVWLF,QWKLVUHJDUGDQRQUDGLRDFWLYHPHWKRGKDVEHHQ
DGDSWHGDW$7&&WRVFUHHQIRUKXPDQLPPXQRGHILFLHQF\ +,9  DQG KHSDWLWLV YLUXVHV HJ
+%9 LQKXPDQIHWDOFHOOVDQGWLVVXHV$VFLWHGE\'DYLG.HOORJJDQGFRZRUNHUV6.DQG
6. SULPHUV KDYH EHHQ VXFFHVVIXOO\ XVHG WR GHWHFW +,9, LQ LQIDQWV ERUQ WR VHURSRVLWLYH
PRWKHUV

7DEOH5HDJHQWVIRUGHWHFWLRQRI+,9
3ULPHUV 6. 777**7&&*&&7$7&&&$*7$**$*$$$7 
 6. 777**7&&77*7&77$7*7&&$*$$7*& 
'1$SUREHV 6.$7&&7***$77$$$7$$07$*7$$*$$7*7$7$*&&&7$&
3RVLWLYHFRQWURO $7&&FHOOOLQH&5/ ( 
1HJDWLYHFRQWURO $7&&FHOOOLQH&&, 05&


7DEOH5HDJHQWVIRUGHWHFWLRQRI+%9
3ULPHUV 0'  K&77**$7&&7$7***$*7**
 0'  &7&$$*&77&$7&$7&&$7$7$
'1$SUREHV 0'  *&&7&$*7&&*777&7&77**&7&$*777$&7$*7*&&$777*77&
3RVLWLYHFRQWURO $7&&FHOOOLQH+% +HS6% 
1HJDWLYHFRQWURO $7&&FHOOOLQH&&/

7DEOH6ROXWLRQVIRU+,9+%9DVVD\V
[7%(EXIIHU 07ULV0ERULFDFLGP0('7$S+
[66&EXIIHU 01D&,01DFLWUDWH +S+
/\VLVEXIIHU 01D&,0('7$07ULV ZY 6'6S+
 PJPOSURWHLQDVH.VWRFNLQ01D&,
 PJPO51DVHVWRFNLQP07ULVS+
0DOHLFDFLG 0PDOHLFDFLG01D&,S+
6WDQGDUGK\EULGL]DWLRQ :ODXUR\OVDUFRVLQH6'6EORFNLQJUHDJHQW
EXIIHU OLWUH  PORI[66&
:DVKLQJEXIIHU 0PDOHLFDFLG01D&, ZY 7ZHHQS+

7KHVHROLJRQXFOHRWLGHVSULPHUV 6.6. DPSOLI\ D ES IUDJPHQW RIWKH +,9
JDJ JHQH 7DEOH   0' DQG 0' ROLJRQXFOHRWLGHV DUH XQLTXH IRU +%9 7KH ILUVW
ROLJRQXFOHRWLGH 0'  VSDQV SRVLWLRQ PDS JHQRPH  DQG WKH VHFRQG SRVLWLRQ
0' 'XULQJWKH3&5DPSOLILFDWLRQWKRVHWZRQXFOHRWLGHVDPSOLI\WKHV\QWKHVLV
RI WKH  ES IUDJPHQWV 7DEOH   7KH DPSOLFRQV DUH VHSDUDWHG E\ D  SRO\DFU\ODPLGH
JHO WKHQ WUDQVIHUUHGWR D Q\ORQ PHPEUDQH E\HOHFWURSKRUHWLF WUDQVEORWWLQJ DQG GHWHFWHG E\
K\EULGL]DWLRQ ZLWK GLJR[LJHQLQ ODEHOOHG ROLJRQXFOHRWLGHV DQG FKHPLOXPLQHVFHQFH 7DEOHV 
(TXLSPHQW UHDJHQWV DQG VXSSOLHV IRU WKHVH PHWKRGV DUH FRPPHUFLDOO\ DYDLODEOH +%9
DPSOLFRQVDQGFRQWUROVUHYHDOHGE\FKHPLOXPLQHVFHDUHSURYLGHGDV)LJXUH

,WVKRXOGEHHPSKDVL]HGWKDWLQVSLWHRIWKHVHVFUHHQVODWHQWYLUXVHVDQGYLUXVHVZKLFK
GRQRWSURGXFHRYHUW&3(RUKDHPDGVRUSWLRQZLOOHVFDSHGHWHFWLRQ6RPHRIWKHVHFRXOGEH
SRWHQWLDOO\ GDQJHURXVIRU WKH FHOO FXOWXUH WHFKQLFLDQ )RUDGGLWLRQDO GHWDLO DQG PHWKRGRORJ\
FRQVXOWUHIV

ϵϯ

 
)LJXUH  3KRWR RI 3&5 IRU +%9 6FUHHQ IRU KXPDQ KHSDWLWLV % VHTXHQFHV LQ IHWDO FHOOV
3RVLWLYH FRQWUROV VKRZ DPSOLFRQV IURP FHOO OLQHV +HS% DQG 3/&35) NQRZQ WR EH
LQIHFWHG ZLWK KHSDWLWLV % $7&& +% DQG &5/  1HJDWLYH FRQWURO DUWHO WHVW
FXOWXUHVDUHLQGLFDWHGE\OHWWHUV:+&

7HVWLQJIRULQWUDVSHFLHVFURVVFRQWDPLQDWLRQ

:LWK WKH GUDPDWLF LQFUHDVH LQ QXPEHUV RI FHOO OLQHV EHLQJ GHYHORSHG WKH ULVN RI
LQWUDVSHFLHV FURVVFRQWDPLQDWLRQ ULVHV SURSRUWLRQDWHO\ 7KH SUREOHP LV HVSHFLDOO\ DFXWH LQ
ODERUDWRULHV ZKHUH ZRUN LV LQ SURJUHVV ZLWK WKH PDQ\ GLIIHUHQW FHOO OLQHV RI KXPDQ DQG
PXULQH RULJLQ K\EULGRPDV  DYDLODEOH WRGD\ 7HVWV IRU XQLTXH NDU\RORJ\ SRO\PRUSKLF
LVRHQ]\PHVDQG'1$DQGVXUIDFHPDUNHUDQWLJHQVDUHDOOLPSRUWDQWWRROVWRGHWHFWFHOOXODU
FURVVFRQWDPLQDWLRQZLWKLQDJLYHQVSHFLHV

*LHPVDEDQGLQJ

$ SRZHUIXO PHWKRG IRU FHOO LGHQWLILFDWLRQ LV NDU\RW\SH DQDO\VLV DIWHU WUHDWPHQW ZLWK
WU\SVLQDQGWKH*LHPVDVWDLQ *LHPVDRU*EDQGLQJ 7KHEDQGLQJSDWWHUQVDUHFKDUDFWHULVWLF
IRU HDFKFKURPRVRPH SDLUDQGSHUPLWUHFRJQLWLRQE\DQH[SHULHQFHG F\WRJHQHWLFLVW HYHQ RI
FRPSDUDWLYHO\ PLQRU LQYHUVLRQV GHOHWLRQV RU WUDQVORFDWLRQV 0DQ\ OLQHV UHWDLQ PXOWLSOH
PDUNHUFKURPRVRPHVUHDGLO\UHFRJQL]DEOHE\WKLVPHWKRGZKLFKVHUYHWRLGHQWLI\WKHFHOOV
VSHFLILFDOO\DQGSRVLWLYHO\


ϵϰ

 
)LJXUH  *LHPVD EDQGHG FKURPRVRPHV IURP WKH FHOO OLQH $7&&&&/ 0%U 
LVRODWHGIURPDUKHVXVPRQNH\EURQFKXV

&RPSOHWHO\ GULHG VOLGHV DUH XVHG WR H[DPLQH XQGHU EULJKWILHOG RLOLPPHUVLRQ
SODQDSRFKURPDW REMHFWLYHV ZLWKRXW FRYHUVOLS 2LO FDQ EH SODFHG GLUHFWO\ RQ WKH VOLGH
+RZHYHU FDUH PXVW EH WDNHQ QRW WR VFUDWFK WKH FHOO VXUIDFH 2LO PXVW EH UHPRYHG DV
FRPSOHWHO\DVSRVVLEOHLPPHGLDWHO\DIWHUWKHXVHRIVOLGHV*HQHUDOO\DIHZFKDQJHVLQ[\OHQH
VKRXOGEHVDWLVIDFWRU\$W\SLFDOEDQGHGSUHSDUDWLRQLVVKRZQDV)LJXUH

'1$ILQJHUSULQWLQJ

'1$ ILQJHUSULQWLQJ RI KXPDQ FHOO OLQHV SURYLGHV WKH UHVROXWLRQ QHFHVVDU\ WR FRQILUP
WKHDXWKHQWLFLW\RIDFHOOOLQHDQGWRUXOHRXWWKHSRVVLELOLW\RIFHOOOLQHFURVVFRQWDPLQDWLRQ
'1$ ILQJHUSULQWLQJ EHFDPH SRVVLEOH ZLWK LGHQWLILFDWLRQ RI K\SHUYDULDEOH UHSHWLWLYH
PLQLVDWHOOLWH EDVHUHSHWLWLYHPRWLILVES '1$7UDGLWLRQDOXVHRIWKHVHORFLLQYROYHG
WKHODERULRXVWLPHFRQVXPLQJSURFHGXUHRI6RXWKHUQEORWWLQJ7ZRVWUDWHJLHVKDYHEHHQXVHG
ZKHQ ZRUNLQJ ZLWK 9175 ORFL 7KH ILUVW VWUDWHJ\ HPSOR\V D PXOWLORFXV SUREH WKDW FDQ
VLPXOWDQHRXVO\ LOOXPLQDWH WKH JHQRW\SH DW PDQ\ ORFL $OWKRXJK KLJKO\ LQIRUPDWLYH WKLV
VWUDWHJ\LV SUREOHPDWLF DV D URXWLQH VFUHHQLQJ WHFKQLTXHGXHWRWKHGLIILFXOW\LQLQWHUSUHWLQJ
WKH FRPSOH[ PXOWLSOH EDQGLQJ SDWWHUQV 7KH DOWHUQDWLYH VWUDWHJ\ LV WR XVH D FRFNWDLO RI OHVV
LQIRUPDWLYH VLQJOH ORFXV 9175 SUREHV :KHQ WKH VLQJOH ORFXV SUREH JHQRW\SHV DUH
FRPELQHGDOHYHORIGLVFULPLQDWLRQVLPLODUWRPXOWLORFXV9175ILQJHUSULQWVLVSRVVLEOHZLWK
WKH VLPSOLFLW\ RI LQWHUSUHWLQJ WZR EDQG SDWWHUQV 7KH DGDSWDWLRQ RI WKH SRO\PHUDVH FKDLQ
UHDFWLRQ 3&5 KDVUHPRYHGWKHQHHGWRXVH6RXWKHUQEORWWLQJZKHQH[DPLQLQJWKHVH9175
ORFLZKLFKPHDQVWKDWORFLFDQEHW\SHGLQKRXUVUDWKHUWKDQGD\V
6PDOOHUPLFURVDWHOOLWH EDVHUHSHWLWLYHPRWLILVES ORFLKDYHEHHQLGHQWLILHGDVZHOO
6KRUWWDQGHPUHSHDW 675 ORFLLQGLIIHUHQWLDWLQJKXPDQVDWWKH'1$OHYHO2QHVLJQLILFDQW
DGYDQWDJHHQMR\HGE\675ORFLRYHUWKHLUPLQLVDWHOOLWHFRXVLQVLVWKHLUVPDOOVL]H7KHVPDOO
VL]H RI 675 ORFL DOORZV PXOWLSOH[ 3&5 UHDFWLRQV WR EH GHYHORSHG LQ ZKLFK PDQ\ ORFL DUH
VLPXOWDQHRXVO\ H[DPLQHG LQ D VLQJOH UHDFWLRQ:KHQ DXWKHQWLFDWLQJ D QHZ OLQH LW LV
UHFRPPHQGHG WKDW '1$ EHH[WUDFWHGIURP WKHFHOOOLQHXVLQJ DWUDGLWLRQDOOLTXLGH[WUDFWLRQ
PHWKRGDVWKLVWHQGVWRPLQLPL]H675DUWHIDFWVZKLFKPD\FRPSOLFDWHDOOHOHDVVLJQPHQW)RU
YDOLGDWLRQRIVXEVHTXHQWSDVVDJHVRI WKHFHOOOLQH PRUHH[SHGLHQW '1$ WHFKQLTXHVPD\ EH
XVHG ZKLFK PD\ SURGXFH DPELJXRXV DOOHOH DVVLJQPHQWV *HQHUDOO\ FRPSDULVRQ ZLWK WKH
DXWKHQWLF '1$ ILQJHUSULQW HDVLO\ UHVROYHV WKHVH DPELJXLWLHV $OWKRXJK WKH 675 V\VWHP

ϵϱ

SUHVHQWHG XWLOL]HV IOXRUHVFHQW ODEHOV DQG DQ DXWRPDWHG FROOHFWLRQ GHYLFH LW VKRXOG EH QRWHG
WKDWYDULRXV6,5IRUPDWVKDYHEHHQGHYHORSHGWKDWXVHLVRWRSLFFKHPLOXPLQHVFHQWRUVLOYHU
VWDLQLQJWRGHWHFWDQGW\SHWKHVHORFLZLWKVLPLODUDFFXUDF\2QHIDFHWRI'1$ILQJHUSULQWLQJ
GDWDZKLFKFDQQRWEHRYHUHPSKDVL]HGLVWKHQHHGWRFRQYHUW3&5IUDJPHQWVL]HVLQWRDOOHOHV
ZKHQGHYHORSLQJJHQRW\SHVIRUFHOOOLQHV7KLVUHTXLUHVWKHGHYHORSPHQWRIDQDOOHOLFODGGHU
ZKLFKFRQWDLQVDOORIWKHFRPPRQO\REVHUYHGDOOHOHVIRUHDFK675ORFXVXQGHUH[DPLQDWLRQ
7KLVODGGHUPXVWEHUXQRQHYHU\JHODVLWZLOOVHUYHWRQRUPDOL]HWKHGDWDDQGPLQLPL]HWKH
HUURUV WKDW LQHYLWDEO\ FURS XS ZKHQ FRPSDULQJ IUDJPHQW VL]H GDWD EHWZHHQ GLIIHUHQW JHOV
0RUHLPSRUWDQWO\WKLVDOORZVGLIIHUHQWODERUDWRULHVZKLFKPD\XVHGLIIHUHQW675IRUPDWVWR
FRPSDUH WKHLU UHVXOWV LQ D VWUDLJKWIRUZDUG XQDPELJXRXV PDQQHU 7\SLFDO 675 SURILOLQJ
UHVXOWVDUHSUHVHQWHGLQWKHHOHFWURSKHURJUDPV )LJXUHVDQG )LJXUHUHSUHVHQWVWKHGDWD
JHQHUDWHGZKHQDQDO\VLQJWZRFHOOOLQHVGHULYHGIURPWKHVDPHSDWLHQW)LJXUHFRPSDUHVWKH
675SURILOHVJHQHUDWHGIURPWZRXQUHODWHGFHOOOLQHV



)LJXUH'1$SURILOHVRIFHOOOLQHVIURPWKHVDPHSDWLHQW&RPSDULVRQRIWKHLGHQWLFDO675
SURILOHVIRUWKH(%9WUDQVIRUPHGO\PSKREODVWOLQH&5/DQGWKHWXPRXUOLQH&5/
GHULYHGIURPWKHVDPHIHPDOH SDWLHQW 8SSHUWUDFLQJV UHSUHVHQW WKHIRXU675ORFL'66
'6 '6 DQG '6 7KH ORZHU WUDFLQJV UHSUHVHQW WKH IRXU 675 ORFL Y:$
7+732;DQG&6)32DVZHOODVWKHDPHORJHQLQORFXVXVHGIRUJHQGHULGHQWLILFDWLRQ


ϵϲ

 
)LJXUH'1$SURILOHVRIWZRXQUHODWHGFHOOOLQHV&RPSDULVRQRIXQLTXH675SURILOHVIRU
WKH XQUHODWHG PDOH FHOO OLQH &5/ DQG IHPDOH FHOO OLQH &5/ 8SSHU WUDFLQJV
UHSUHVHQW WKHIRXU675WRFL'6'6'6 DQG '67KH ORZHUWUDFLQJV
UHSUHVHQW WKH IRXU 675 ORFL Y:$ 7+ 732; DQG &6)32 DV ZHOO DV WKH DPHORJHQLQ
ORFXVXVHGIRUJHQGHULGHQWLILFDWLRQ

7DEOH/DERUDWRU\VWRFNEXIIHUVDQGUHDJHQWV
[3%6 P01D&,P0.&,P0
6'6 1D+3P0.+32S+
01D&, 

,VRSURSDQRO 
HWKDQRO 
/RZ7(EXIIHU P07ULVP0('7$S+








ϵϳ

 
7DEOH9HQGRUUHDJHQWVDQGVXSSOLHV
&HOOO\VLVVROXWLRQ *HQWUD6\VWHPV&DW1R'. 
51DVH$VROXWLRQ *HQWUD6\VWHPV&DW1R'. 
)7$FODVVLFIRUPDWFDUG /LIH7HFKQRORJLHV&DW1R LQFOXGHV
)7$SXULILFDWLRQUHDJHQW
7(D ORZ7(EXIIHUVXSSOLHGZLWKNLW 
8OWUD%$55,(5SRXFK /LIH7HFKQRORJLHV&DW1R 
+$55,6PLFURSXQFK /LIH7HFKQRORJLHV&DW1R 
*HQH3ULQWŒ3RZHU3OH[ 6\VWHP 3URPHJD&DW1R'& LQFOXGHV
*ROG67$5EXIIHU
3RZHU3OH[;SULPHUSDLUPL[
$PSOL7DT*ROGΠ3HUNLQ(OPHU&DW1R1 
0LQHUDORLO 3HUNLQ(OPHU&DW1R 
*652; 3($%'&DW1R 
)RUPDPLGH 6LJPD&DW1R) 
SRO\DFU\ODPLGH 0XUHD %XUVW3DNŒ*HO 2ZO6FLHQWLILF&DW1R6(4 
[7%(OLTXLGFRQFHQWUDWH $PUHVFR&DW1R-/ 

&KDUDFWHUL]DWLRQVDQGFHOOOLQHDYDLODELOLW\

$KRVWRIDGGLWLRQDOFHOOOLQHFKDUDFWHUL]DWLRQVPD\EHFRQVLGHUHGGHSHQGLQJXSRQWKH
WLVVXHW\SHRIRULJLQDQGWKHLQWHQGHGXVHIRUJLYHQFHOOOLQHV)RUH[DPSOHDQDO\VLVRIILQH
VWUXFWXUH LPPXQRORJLFDO WHVWV IRU F\WRVNHOHWDO DQG WLVVXHVSHFLILF SURWHLQV RU DVVD\V IRU
PRQRFORQDO DQWLERG\ VHFUHWHG PD\ EH UHTXLUHG $XWKHQWLFDWHG FHOO OLQHV PD\ EH REWDLQHG
IURP QDWLRQDOEDQNV HVWDEOLVKHGRYHUWKHSDVW \HDUV6XFKSXEOLF UHSRVLWRULHV LQFOXGH
WKH $7&& WKH +XPDQ *HQHWLF 0XWDQW &HOO 5HSRVLWRU\ DW WKH &RULHOO ,QVWLWXWH IRU 0HGLFDO
5HVHDUFKLQ&DPGHQ1-86$WKH*HUPDQ&ROOHFWLRQRI0LFURRUJDQLVPVDQG&HOO&XOWXUHV
'60= LQ%UDXQVFKZHLJWKH(XURSHDQ&ROOHFWLRQRI$QLPDO&HOO&XOWXUHV3RUWRQ'RZQ
6DOLVEXU\ 8. WKH -DSDQHVH &HOO %DQN IRU &DQFHU 5HVHDUFK DW WKH 1DWLRQDO ,QVWLWXWH RI
+\JLHQH6HUYLFHVLQ7RN\RDQGWKH5LNHQ&HOO%DQNLQ7VXNXED&LW\-DSDQ

5HIHUHQFHV

%DJLQVNL/3HUULH$:DWVRQ'HWDO  ,Q3&5SURWRFROVDJXLGHWRPHWKRGVDQG
DSSOLFDWLRQV HG 0 $ ,QQLV ' + *HOIDQG - - 6QLQVN\ HW DO  SS 
$FDGHPLF3UHVV,QF
%DULOH0)  ,Q&HOOFXOWXUHDQGLWVDSSOLFDWLRQ HG57$FWRQDQG-'/\QQ S
$FDGHPLF3UHVV/RQGRQDQG1HZ<RUN
&KHQ75+D\5-DQG0DF\0/  &DQFHU*HQHW&\WRJHQHW
&RXU/0D[ZHOO*DQG+D\5-  7LVVXH&XOWXUH$VVRF0DQ
'LOZRUWK6+D\5-DQG'DJJHWW30  7LVVXH&XOWXUH$VVRF0DQ
'XUNLQ$6DQG5HLG<$  $7&&41HZVO
(GZDUGV$+DPPRQG+$-LQ/&DVNH\&7DQG&KDNUDERUW\5  *HQRPLFV

)UHVKQH\5,  &XOWXUHRIDQLPDOFHOOVQGHGQ$ODQ5/LVV,QF1HZ<RUN
*LOEHUW'$5HLG<$*DLO0+3HH':KLWH&+D\5-HWDO  $P-
+XP*HQHW
+D\ 5 -   ,Q 0DUNHUV RI FRORQLF FHOO GLIIHUHQWLDWLRQ HG 6 5 :ROPDQ DQG $ -
0DVWURPDULQR S5DYHQ3UHVV1HZ<RUN

ϵϴ

+D\5-  $QDO%LRFKHP
+D\5-  7HVWLQJFHOOFXOWXUHVIRUPLFURELDODQGYLUDOFRQWDPLQDQWVFHOOELRORJ\D
ODERUDWRU\KDQGERRN  
+D\5- HG   $7&&TXDOLW\FRQWUROPHWKRGVIRUFHOOOLQHVQGHGQ5RFNYLOOH0'
+D\5-0DF\0/DQG&KHQ75  1DWXUH
+D\5-:LOOLDPV&'0DF\0/DQG/DYDSSD.6  $P5HY5HVSLU'LV
&RQVXOWWKH$7&&:HEVLWHDWKWWSZZZDWFFRUJIRUXSWRGDWHOLVWLQJV
+VX 7 & DQG %HQLUVFKNH .   $Q DWODV RI PDPPDOLDQ FKURPRVRPHV 
YROXPHV6SULQJHU9HUODJ1HZ<RUN+HLGHOEHUJDQG%HUOLQ
-HIIUH\V$-:LOVRQ9DQG7KHLQ6/  1DWXUH
.HOORJJ'(DQG.ZRN6  ,Q3&5SURWRFROVDJXLGHWRPHWKRGVDQGDSSOLFDWLRQV
HG0$,QQLV'+*HOIDQG--6QLQVN\HWDW SS$FDGHPLF3UHVV,QF
/DWRUUD'HWDO  3&50HWKRGV$SSO  
/H'XF-:6PLWK*$0DF\0/DQG+D\5-  -,QIHFW'LV
0DF\0/  7LVVXH&XOWXUH$VVRF0DQ
0F*DUULW\*-  $GY&HOO&XOWXUH
1DNDPXUD < /HSSHUW 0 2 &RQQHOO 3 :ROI 5 +ROP 7 &XOYHU 0 HW DO
 6FLHQFH
1HOVRQ5HHV:$DQG)ODQGHUPH\HU55  6FLHQFH :DVK 
1HOVRQ5HHV : $ )ODQGHUPH\HU 5 5 DQG +DZWKRUQH 3 .   6FLHQFH :DVK 

1HOVRQ5HHV : 'DQLHOV : : DQG )ODQGHUPH\HU 5 5   6FLHQFH :DVK  

2 %ULHQ6-6KDQQRQ-(DQG*DLO0+  ,Q9LWUR
5RYR]]R*&DQG%XUNH&1  $PDQXDORIEDVLFYLURORJLFDOWHFKQLTXHV3UHQWLFH
+DOO,QF(QJOHZRRG&OLIIV1HZ-HUVH\
6DMDQWLOD$ 3XRPLODKWL6-RKQVVRQ9 DQG(KQKROP &   %LRWHFKQLTXHV   

6FKDHIIHU:,  ,Q9LWUR
6WXOEHUJ&6  ,Q&RQWDPLQDWLRQLQWLVVXHFXOWXUH HG-)RJK S$FDGHPLF3UHVV
/RQGRQDQG1HZ<RUN
6XQ1&&KX(+<DQG&KDQJ&&  0DPP&KURPRVRPH1HZVO-DQ
7DQJ-+X0/HH6DQG5REOLQ5  ,Q9LWUR&HOO'HY%LRO
:LJOH\&%  'LIIHUHQWLDWLRQ
:ULJKW:&'DQLHOV:3DQG)RJK-  -1DWO&DQFHU,QVW


ϵϵ

 &KDSWHU
6HUXPIUHHPHGLD

,QWURGXFWLRQ

7KH UHPRYDO RI VHUXP RU RWKHU XQGHILQHG FRPSRQHQWV IURP FHOO FXOWXUH PHGLXP
LQYROYHVDPXOWLIDFHWHGDSSURDFK7KLVLVPDLQO\GXHWRWKHLQWHUDFWLYHQDWXUHRIFHOOFXOWXUH
V\VWHPV &HOO FXOWXUH V\VWHPV UHTXLUH YDULRXV FRPSRQHQWV EDVDO QXWULHQWV D VHW RI
VXSSOHPHQWV WKDW FRQYH\ LQIRUPDWLRQ VXFK DV JURZWK IDFWRUV PLWRJHQV KRUPRQHV DQG
F\WRNLQHVDQGIRUDQFKRUDJHGHSHQGHQWFHOOVDVXEVWUDWH,QGHVLJQLQJDQ\FHOOFXOWXUHV\VWHP
DWWHQWLRQ PXVW EH SDLG WR DOO WKHVHFRPSRQHQWVDQG WKHLU LQWHUDFWLRQV 7KH UROH RI WKH EDVDO
QXWULHQW FRPSRQHQW QHHGV WR EH DGGUHVVHG LQ D V\VWHPDWLF PDQQHU )RU QRUPDO HXNDU\RWLF
FHOOVWKHRSWLPL]DWLRQRIWKHEDVDOQXWULHQWVLVDQLPSRUWDQWDVSHFWLQWKHJHQHUDWLRQRIVHUXP
IUHHPHGLD7KHUHPRYDORIDQHVVHQWLDOQXWULHQWVXFKDVDQDPLQRDFLGYLWDPLQRUPLQHUDO
ZRXOGHIIHFWLYHO\LQKLELWWKHDFWLYLW\RIWKHFHOOVLQDVHUXPIUHHFXOWXUHHQYLURQPHQW,WKDV
EHHQ GHPRQVWUDWHG TXDOLWDWLYHO\ WKDW YDULRXV FHOO W\SHV UHTXLUH WKH VDPH QXWULHQWV EXW WKDW
TXDQWLWDWLYHO\ WKHUH DUH VLJQLILFDQW GLIIHUHQFHV ,W LV UHDVRQDEOH WR DVVXPH WKDW WKHUH LV DQ
RSWLPL]HG FRQFHQWUDWLRQ IRU D VHW RI QXWULHQWV IRU D SDUWLFXODU IXQFWLRQ IRU D SDUWLFXODU FHOO
W\SH

5ROHRIVHUXPDQGRWKHUXQGHILQHGWLVVXHH[WUDFWVLQFHOOFXOWXUHV\VWHPV

,Q PHGLD WKHVH XQGHILQHG VXSSOHPHQWV VHUXP SLWXLWDU\ EUDLQ DQG RWKHU H[WUDFWV 
SURYLGHQRWRQO\HVVHQWLDOQXWULHQWVDQGDWWDFKPHQWIDFWRUVEXWDOVRDFWDVGHWR[LILFDQWV7KH
XQGHILQHGQDWXUHRIWKHVHVXSSOHPHQWVDQGWKHLUSRWHQWLDOIRUFDUU\LQJDGYHQWLWLRXVDJHQWVDQG
GHWHUPLQLQJ WKH SKHQRW\SH RI FHOOV PRWLYDWHV WKHLU DYRLGDQFH RU PLQLPL]DWLRQ ZKHQHYHU
SRVVLEOH7KHVHVXSSOHPHQWVFDQFRQWDLQLQKLELWRUVRUSURPRWHUVRIWKHSURFHVVHVXQGHUVWXG\
,Q WKH ELRSURFHVVLQJ LQGXVWU\ WKH FRQWULEXWLRQ RI WKHVH VXSSOHPHQWV WR WKH ILQDO SURGXFW
QHFHVVLWDWHVH[WHQVLYHGRZQVWUHDPSXULILFDWLRQ,QDGGLWLRQWKHFHOOSKHQRW\SHFDQEHEHWWHU
FRQWUROOHGLQWKHDEVHQFHRIVHUXP

5HVSRQVHFXUYHV
3UROLIHUDWLQJFXOWXUHV

7KH TXDQWLWDWLYH HYDOXDWLRQ RI QXWULHQW UHTXLUHPHQWV QHFHVVLWDWHV WLWUDWLRQ RI WKH EDVDO
FRPSRQHQWV LQ D V\VWHPDWLF PDQQHU 7KH UHVSRQVHV HYDOXDWHG FDQ EH DQ\ FHOOXODU
FKDUDFWHULVWLFSUROLIHUDWLRQSURGXFWVHFUHWLRQRUH[SUHVVLRQRIDGLIIHUHQWLDWHGIXQFWLRQ7ZR
W\SHVRIUHVSRQVHVDUHSRVVLEOHWKHHVVHQWLDOQXWULHQWUHVSRQVHDQGWKHQRQHVVHQWLDOQXWULHQW
UHVSRQVH )LJXUH   7KH HVVHQWLDO UHVSRQVH LV FKDUDFWHUL]HG E\ D ]HUR UHVSRQVH WR ]HUR
FRQFHQWUDWLRQIROORZHGE\DSRVLWLYHLQFUHDVHWRULVLQJFRQFHQWUDWLRQVDSODWHDXUHJLRQZKHUH
QR LQFUHDVH LQ UHVSRQVH LV REVHUYHG ZLWK KLJKHU FRQFHQWUDWLRQ DQG ILQDOO\ DQ LQKLELWRU\
UHJLRQ 7KH VORSH RI WKH SRVLWLYH UHVSRQVH WKH OHQJWK RI WKH SODWHDX DQG WKH VORSH RI WKH
LQKLELWRU\UHJLRQVDUHGHSHQGHQWRQWKHQXWULHQWDQGFHOOXQGHUVWXG\7KHDLPRIWKLVH[HUFLVH
LV WR GHWHUPLQH WKH FRQFHQWUDWLRQ RI WKH QXWULHQW WKDW LV UHSUHVHQWHG E\ WKH PLGGOH RI WKH
SODWHDX

,Q RSWLPL]LQJ WKH FRQFHQWUDWLRQ RI D QXWULHQW DPLQR DFLGV UHSUHVHQW WKH ODUJHVW JURXS
ZKHUHLQWHUDFWLRQVRFFXUEHFDXVHWKHUHDUHFRPPRQWUDQVSRUWV\VWHPVIRUDPLQRDFLGV7KHVH
V\VWHPVLQWHUDFWLQDSRVLWLYHRUQHJDWLYHPDQQHU$FRQVHTXHQFHRIWKLVLVWKDWE\FKDQJLQJ

ϭϬϬ

WKHFRQFHQWUDWLRQRIRQHDPLQRDFLGLWLVSRVVLEOHWRLQIOXHQFHWKHUHVSRQVHFXUYHRIDQRWKHU
DPLQRDFLG%\SODFLQJWKHFRQFHQWUDWLRQRIDFRPSRQHQWLQWKHPLGGOHRIWKHSODWHDXUHJLRQ
DVKLIWLQDQ\GLUHFWLRQZLOOPLQLPL]HWKHULVNRIHQWHULQJDGHILFLHQWRULQKLELWRU\DUHD7KH
QRQHVVHQWLDOFRQGLWLRQLVFKDUDFWHUL]HGE\DVLJQLILFDQWUHVSRQVHDW]HURFRQFHQWUDWLRQRIWKH
QXWULHQW 7KHUH PD\ DOVR EH D UHVSRQVH WR LQFUHDVLQJ FRQFHQWUDWLRQV RI WKH QXWULHQW ,I WKH
GHVLUHGRXWFRPHLVPD[LPDOSUROLIHUDWLRQWKHQWKHFRQFHQWUDWLRQRIWKHQRQHVVHQWLDOQXWULHQW
DOVRQHHGVWREHRSWLPL]HG

([DPSOHVRIWKLVDUHREVHUYHGLQ)LJXUHVDQG,Q)LJXUH/SKHQ\ODODQLQHDQG/
W\URVLQH DUH WLWUDWHG XVLQJ QRUPDO KXPDQ DRUWLF VPRRWK PXVFOH FHOOV $260&  7KH /
W\URVLQH WLWUDWLRQ GHPRQVWUDWHV WKDW LQ WKH DEVHQFH RI /W\URVLQH SUROLIHUDWLRQ FORVH WR
PD[LPXP LV REVHUYHG +RZHYHU LQ )LJXUH  ZKHUH /SKHQ\ODODQLQH DQG /W\URVLQH DUH
WLWUDWHGXVLQJQRUPDOKXPDQEURQFKLDOWUDFKHDOHSLWKHOLDOFHOOV 1+%( /W\URVLQHDSSHDUVWR
EHDQHVVHQWLDOQXWULHQW,QZKROHDQLPDOV/SKHQ\ODODQLQHFDQEHFRQYHUWHGWR/W\URVLQHE\
/SKHQ\ODODQLQH K\GUR[\ODVH 7KLV PHWDEROLVP KDV EHHQ REVHUYHG LQ YDULRXV RWKHU FHOO
FXOWXUH V\VWHPV EXW QRW ZLWK 1+%( ,Q D VLPLODU IDVKLRQ WLWUDWLQJ WKH DPLQR DFLG SDLU /
PHWKLRQLQH DQG /F\VWHLQH )LJXUHV  DQG   LW LV VHHQ WKDW /F\VWHLQH LV QRW DQ HVVHQWLDO
DPLQRDFLGIRU$260&ZKHUHDVLQ1+%(/F\VWHLQHLVHVVHQWLDO/F\VWHLQHLVV\QWKHVL]HG
IURP /VHULQH DQG /PHWKLRQLQH LQ WKH OLYHU DQG EUDLQ DQG LQ ILEUREODVWV H[SUHVVLQJ
F\VWDWKLRQLQHV\QWKHWDVH

1XWULHQWUHTXLUHPHQWVIRUFHOOVLQFXOWXUHDUHGHWHUPLQHGEHVWLQFORQDOJURZWKDVVD\V
$W KLJK GHQVLW\ FHOOV DUH DEOH WR FRQGLWLRQ WKH PHGLXP E\ H[FUHWLQJHVVHQWLDO IDFWRUV ,Q D
FORQDO JURZWK DVVD\ WKH YROXPH RI PHGLXP LV WRR ODUJH IRU WKH VPDOO QXPEHU RI FHOOV WR
HIIHFWLYHO\ FRQGLWLRQ WKH PHGLXP &RQVHTXHQWO\ WKH FHOOV DUH GHSHQGHQW RQ WKH QXWULHQWV
SUHVHQWLQWKHPHGLXPDQGDGHILFLHQF\PD\EHREVHUYHG


ϭϬϭ

 

)LJXUH,GHDOL]HGUHVSRQVHRIDQHVVHQWLDO $ DQGQRQHVVHQWLDO % QXWULHQW%DVHG
RQ WKHVH UHVSRQVHV LW LV SRVVLEOH WR GHWHUPLQH WKH RSWLPL]HG FRQFHQWUDWLRQ RI WKH QXWULHQW
1RWHWKDWLQWKHDEVHQFHRIDQHVVHQWLDOQXWULHQW RQHWKDWFDQQRWEHV\QWKHVL]HGE\WKHFHOO 
QR UHVSRQVH LV REVHUYHG DW ]HUR FRQFHQWUDWLRQ 2Q DGGLWLRQ RI WKH HVVHQWLDO QXWULHQW D GRVH
UHVSRQVH LV REVHUYHG DQ LQFUHDVH LQ FRQFHQWUDWLRQ UHVXOWV LQ DQ LQFUHDVH LQ UHVSRQVH $W
KLJKHU FRQFHQWUDWLRQV D SODWHDX LV REVHUYHG ZKHUH WKHUH LV QR LQFUHDVH LQ UHVSRQVH ZLWK
LQFUHDVHG FRQFHQWUDWLRQ 7KH WKLUG SDUW RI WKH UHVSRQVH LV FKDUDFWHUL]HG E\ D GHFUHDVH LQ
UHVSRQVHZLWKLQFUHDVLQJFRQFHQWUDWLRQRIQXWULHQW,QWKHFDVHRIWKHQRQHVVHQWLDOQXWULHQWD
VLJQLILFDQWUHVSRQVHLVREVHUYHGDW]HURFRQFHQWUDWLRQ+RZHYHUIXUWKHUDGGLWLRQRIWKHQRQ
HVVHQWLDOQXWULHQWPD\UHVXOWLQDQHQKDQFHGUHVSRQVH$OWKRXJKWKHQRQHVVHQWLDOQXWULHQWFDQ
EHV\QWKHVL]HGE\WKHFHOOLWPD\QRWEHV\QWKHVL]HGDWUDWHVVXIILFLHQWWRPHHWWKHPD[LPXP
UHTXLUHPHQWDQGRUWKHDGGLWLRQRIWKHQXWULHQWPD\UHOLHYHWKHPHWDEROLFORDGUHTXLUHGIRULWV
V\QWKHVLV


ϭϬϮ

 
)LJXUH  7LWUDWLRQ RI /SKHQ\ODODQLQH $  DQG /W\URVLQH %  XVLQJ $260& /
SKHQ\ODODQLQHLVGHPRQVWUDWLQJHVVHQWLDOQXWULHQWEHKDYLRXUZKLOH/W\URVLQHLVGHPRQVWUDWLQJ
QRQHVVHQWLDO QXWULHQW EHKDYLRXU ,Q WKH DEVHQFH RI /W\URVLQH /SKHQ\ODODQLQH PD\ EH
FRQWULEXWLQJWRWKH/W\URVLQHSRROWKURXJKWKHDFWLRQRISKHQ\ODODQLQHK\GUR[\ODVHEXWWKHUH
PD\DOVREHSURWHLQEUHDNGRZQFRQWULEXWLQJWRWKH/W\URVLQHSRRO7KHFHOOVZHUHSODWHGDW
FHOOVFP DQGNHSWLQFXOWXUHIRUGD\VZLWKRXWDPHGLXPFKDQJHDQGWKHQIL[HGLQ
IRUPDOGHK\GHDQGVWDLQHGZLWKFU\VWDO YLROHW 4XDQWLWDWLRQZDV SHUIRUPHG E\ H[WUDFWLQJ WKH
FU\VWDO YLROHW DQG UHDGLQJ WKH RSWLFDO GHQVLW\ DW  QP 7KH RSWLFDO GHQVLW\ RI H[WUDFWHG
FU\VWDO YLROHW LV FRUUHODWHG ZLWK FHOO QXPEHU GXULQJ ORJDULWKPLF JURZWK 1R VHUXP RU RWKHU
WLVVXH H[WUDFW ZDV SUHVHQW LQ WKH PHGLXP XQOHVV RWKHUZLVH VWDWHG 7KH YDOXHV RQ WKH [ D[LV
UHIHUWRPXOWLSOHVRIWKHORJRIWKHRSWLPDOFRQFHQWUDWLRQ

ϭϬϯ

 



)LJXUH  7LWUDWLRQ RI /SKHQ\ODODQLQH $  DQG /W\URVLQH %  LQ 1+%( %RWK /
SKHQ\ODODQLQHDQG/W\URVLQHEHKDYHDVHVVHQWLDOQXWULHQWV7KHYDOXHVRQWKH[D[LVUHIHUWR
PXOWLSOHVRIWKHORJRIWKHRSWLPDOFRQFHQWUDWLRQ7KHVHFHOOVZHUHSODWHGDWFHOOVFP DQG
NHSWLQFXOWXUHIRUVHYHQGD\VZLWKRXWDPHGLXPFKDQJH1RVHUXPRURWKHUWLVVXHH[WUDFWZDV
SUHVHQWLQWKHPHGLXPXQOHVVRWKHUZLVHVWDWHG7KHYDOXHVRQWKH[D[LVUHIHUWRPXOWLSOHVRI
WKHORJRIWKHRSWLPDOFRQFHQWUDWLRQ4XDQWLWDWLRQZDVSHUIRUPHGDVGHVFULEHGLQ)LJXUH


ϭϬϰ

 

)LJXUH7LWUDWLRQRI/PHWKLRQLQH $ DQG/F\VWHLQH % LQ$260&/PHWKLRQLQH
LVGHPRQVWUDWLQJHVVHQWLDOQXWULHQWEHKDYLRXUZKLOH/F\VWHLQHLVGHPRQVWUDWLQJQRQHVVHQWLDO
QXWULHQW EHKDYLRXU /F\VWHLQHFDQ EHV\QWKHVL]HG IURP /VHULQH ZKLFK SURYLGHV WKH FDUERQ
FKDLQDQG/PHWKLRQLQHZKLFKSURYLGHVWKHVXOIXUDWRP1RVHUXPRURWKHUWLVVXHH[WUDFWZDV
SUHVHQWLQWKHPHGLXP7KHYDOXHVRQWKH[D[LVUHIHUWRPXOWLSOHVRIWKHORJRIWKHRSWLPDO
FRQFHQWUDWLRQ&RQGLWLRQVDUHVLPLODUWRWKRVHVWDWHGLQ)LJXUH

2QH EDVDO FRPSRQHQW ZLWK SURIRXQG HIIHFWV RQ FHOO SUROLIHUDWLRQ LV VRGLXP FKORULGH
1D&O  )LJXUH  GHPRQVWUDWHV WKH UHVSRQVH RI QRUPDO KXPDQ HSLGHUPDO NHUDWLQRF\WHV
1+(.  WR YDULRXV FRQFHQWUDWLRQV RI 1D&O 7KH UHVSRQVH LV FKDUDFWHUL]HG E\ D UHODWLYHO\
VKDUSSHDN7KHVHQVLWLYLW\WR1D&OPD\EHGXHWRWKHHQHUJ\H[SHQGLWXUHDVVRFLDWHGZLWKWKH
PDLQWHQDQFHRIWKH1D.$73DVHPHPEUDQHWUDQVSRUW

ϭϬϱ

 


)LJXUH  7LWUDWLRQ RI /PHWKLRQLQH $  DQG /F\VWHLQH %  LQ 1+%( %RWK /
PHWKLRQLQH DQG /F\VWHLQH EHKDYH DV HVVHQWLDO QXWULHQWV 7KH YDOXHV RQ WKH [ D[LV UHIHU WR
PXOWLSOHVRIWKHORJRIWKHRSWLPDOFRQFHQWUDWLRQ7KHVHFHOOVZHUHSODWHGDWFHOOVFP DQG
NHSWLQFXOWXUHIRUVHYHQGD\VZLWKRXWDPHGLXPFKDQJH1RVHUXPRURWKHUWLVVXHH[WUDFWZDV
SUHVHQWLQWKHPHGLXPXQOHVVRWKHUZLVHVWDWHG7KHYDOXHVRQWKH[D[LVUHIHUWRPXOWLSOHVRI
WKHORJRIWKHRSWLPDOFRQFHQWUDWLRQ4XDQWLWDWLRQZDVSHUIRUPHGDVGHVFULEHGLQ)LJXUH

1RQSUROLIHUDWLQJFXOWXUHV3ULPDU\&HOOV H[KHSDWRF\WHV 

1RUPDODGXOWUKHVXVPRQNH\KHSDWRF\WHVGRQRWSUROLIHUDWHWRDQ\VLJQLILFDQWH[WHQW$
FKDUDFWHULVWLFRIKHSDWRF\WHVLVF\WRFKURPH3DFWLYLW\DQGWKHPHGLXPRSWLPL]DWLRQXVHV
WKLV DFWLYLW\ DV DQ HQGSRLQW ,Q )LJXUH  WKH WLWUDWLRQ RI WZR DPLQR DFLGV LV GHSLFWHG XVLQJ
KHSDWRF\WHV H[SRVHG IRU  KRXUV WR PHWK\OFKRODQWKUHQH $ KRPRORJRXV VHULHV RI WKH Q
DON\O HWKHUV RI SKHQR[D]RQH DONR[\UHVRUXILQV  LV DYDLODEOH IRU WKH VWXG\ RI YDULRXV

ϭϬϲ

F\WRFKURPH3V7KHSKHQR[D]RQHHWKHUVDUHK\GUR[\ODWHGDQGGHDON\ODWHGWRDFRPPRQ
IOXRUHVFHQWPHWDEROLWHUHVRUXILQZKLFKIOXRUHVFHVDWQPZKHQH[FLWHGDWQP7KH
SDUWLFXODUSKHQR[D]RQHHWKHUXVHGWRPHDVXUHF\WRFKURPH3XSRQPHWK\OFKRODQWKUHQH
LQGXFWLRQZDVHWKR[\SKHQR[D]RQH7KH/OHXFLQHWLWUDWLRQGHPRQVWUDWHVDGRVHUHVSRQVHEXW
QRGRVHUHVSRQVHLVREVHUYHGIRU/W\URVLQH/OHXFLQHLVGHPRQVWUDWLQJHVVHQWLDODPLQRDFLG
DFWLYLW\ZKLOH/W\URVLQHLVQRWDQGWKLVPD\EHGXHWRWKHFRQYHUVLRQRI/SKHQ\ODODQLQHWR
/W\URVLQHE\SKHQ\ODODQLQHK\GUR[\ODVH



)LJXUH5HVSRQVHRIQRUPDOKXPDQNHUDWLQRF\WHVWRYDULRXVFRQFHQWUDWLRQVRI1D&O
6RGLXPFKORULGHGHPRQVWUDWHVHVVHQWLDOQXWULHQWEHKDYLRXUZKLFKLVQRWVXUSULVLQJJLYHQWKH
YDULRXVIXQFWLRQV1D&OH[HFXWHV2IWKHPDQ\IXQFWLRQVRIVRGLXPFKORULGHLQIOXHQFHRYHU
WKHRVPRODULW\RIWKHPHGLXPLVRQHRIWKHPRVWSURIRXQG$VFDQEHVHHQIURPWKHJUDSKD
FKDQJHLQFRQFHQWUDWLRQKDVVLJQLILFDQWHIIHFWV7KHDUURZUHIHUVWRWKHFRQFHQWUDWLRQ
RI1D&OEHIRUHWKHRSWLPL]DWLRQSURFHVV1RVHUXPRURWKHUWLVVXHH[WUDFWZDVSUHVHQWLQWKH
PHGLXP7KHYDOXHVRQWKH[D[LVUHIHUWRPXOWLSOHVRIWKHORJRIWKHRSWLPDOFRQFHQWUDWLRQ
4XDQWLWDWLRQZDVSHUIRUPHGDVGHVFULEHGLQ)LJXUH

$QWLPLFURELDOVSKHQROUHG+HSHVDQGOLJKW
&HOOFXOWXUHV\VWHPVKDYHDKLJKJURZWKSRWHQWLDOIRUPLFURRUJDQLVPV'XULQJSULPDU\
FXOWXUH FRQWURO RI WKH PLFURELDO ORDG LV KLJKO\ GHVLUDEOH +RZHYHU RQFH WKH FXOWXUH LV
HVWDEOLVKHGDQWLPLFURELDOVDUHXQQHFHVVDU\LQVPDOOVFDOHFXOWXUHVDQGSRWHQWLDOO\FRXOGPDVN
RFFXOW LQIHFWLRQ ,Q DWWHPSWLQJ WR HVWDEOLVK GHILQHG V\VWHPV WKH XVH RI DQWLPLFURELDOV DQG
SKHQROUHGLVGHEDWDEOHKRZHYHULQWKHELRSURFHVVLQJLQGXVWU\ZKHUHWKRXVDQGVRIOLWUHVDUH
DWVWDNHDPLFURELDOFRQWDPLQDWLRQZRXOGEHDILQDQFLDOGLVDVWHU





ϭϬϳ

 
)LJXUH  5HVSRQVH RI 5KHVXV PRQNH\ KHSDWRF\WHV WR YDU\LQJ FRQFHQWUDWLRQV RI /

OHXFLQHDQG/W\URVLQH7KHLVRODWHGKHSDWRF\WHVZHUHLQRFXODWHGDWFHOOVFP RQFROODJHQ
FRDWHG SODWHV $IWHU HLJKW GD\V LQ FXOWXUH WKH KHSDWRF\WHV ZHUH VWLPXODWHG ZLWK  —0 
PHWK\FKRODQWKUHQH IRU DQ DGGLWLRQDO WZR GD\V 0HWK\OFKRODQWKUHQH LV NQRZQ WR LQFUHDVH
WKHH[SUHVVLRQRIF\WRFKURPH3$$WWKDWWLPHHWKR[\SKHQR[D]RQHZDVDGGHGIRU
 PLQ $IWHU WKH LQFXEDWLRQ SHULRG WKH IOXRUHVFHQFH RI WKH K\GUR[\SKHQR[D]RQH DOVR
NQRZQ DV UHVRUXILQ WKH SURGXFW RI WKH UHDFWLRQ  ZDV UHDG LQ WKH &\WR)OXRU UHDGHU VHW DW
H[FLWDWLRQQPDQGHPLVVLRQRIQP(DFKFRQFHQWUDWLRQKDVWZREDUVWKHVPDOOHUEDU
UHSUHVHQWVWKHIOXRUHVFHQFHRIWKHXQVWLPXODWHGKHSDWRF\WHVDQGWKHODUJHUEDUUHSUHVHQWVWKH
IOXRUHVFHQFH RI WKH VWLPXODWHG KHSDWRF\WHV /OHXFLQH GHPRQVWUDWHV HVVHQWLDO QXWULHQW
EHKDYLRXUDQG/W\URVLQHQRQHVVHQWLDOQXWULHQWEHKDYLRXU7KHOLYHUFRQWDLQVSKHQ\ODODQLQH
K\GUR[\ODVH SURGXFLQJ /W\URVLQH DQG WKLV LV WKH PRVW OLNHO\ LQWHUSUHWDWLRQ RI WKH QRQ
HVVHQWLDOEHKDYLRXURI/W\URVLQHLQWKLVH[SHULPHQW






ϭϬϴ

3KHQROUHG

3KHQROUHGLVZLGHO\XVHGDVDS+LQGLFDWRULQFHOOFXOWXUHPHGLD8QIRUWXQDWHO\SKHQRO
UHG RU FRQWDPLQDQWV FDQ LQWHUDFW XQIDYRXUDEO\ ZLWK FXOWXUHG FHOOV FDXVLQJ WR[LFLW\ DQG
RHVWURJHQLFDFWLYLW\ 6RGLXPSRWDVVLXP LRQ KRPHRVWDVLV LV SHUWXUEHG LQVHUXPIUHH PHGLXP
FRQWDLQLQJ SKHQRO UHG DQG WKH HIIHFW LV QHXWUDOL]HG E\ VHUXP RU VHUXP DOEXPLQ $
FRQWDPLQDQWWKDWEHFDPHWR[LFZKHQWKHS+URVHDERYHEXWZDVYLUWXDOO\LQHUWDWORZHU
S+YDOXHV+3/&DQDO\VLVUHYHDOHGPDQ\FRQWDPLQDWLQJSHDNVDQGLGHQWLILHGWKHF\WRWR[LFLW\
ZLWKDSDUWLFXODUSHDNWKDWGLIIHUHGIURPWKHRHVWURJHQLFDFWLYLW\$QWLRHVWURJHQVIUHTXHQWO\
VXSSUHVV JURZWK EHORZ WKDW RI FRQWURO FHOOV QRW WUHDWHG ZLWK RHVWURJHQ HYHQ DIWHU FDUHIXO
VWHSVKDYHEHHQWDNHQWRHOLPLQDWHDOORHVWURJHQIURPWKHVHUXP7KHRHVWURJHQLFDFWLYLW\LV
GXHWRDOLSRSKLOLFLPSXULW\WKDWELQGVWRWKHRHVWURJHQUHFHSWRUZLWKDQDIILQLW\WKDWRI
RHVWUDGLRO )LJXUH  GHPRQVWUDWHV WKH UHVSRQVH RI IRXU GLIIHUHQW VWUDLQV RI QRUPDO KXPDQ
EURQFKLDOWUDFKHDO HSLWKHOLDO FHOOV 1+%(  WR YDU\LQJ FRQFHQWUDWLRQV RI SKHQRO UHG 7KHVH
FHOOV ZHUH FXOWXUHG LQ WKH DEVHQFH RI ERYLQH SLWXLWDU\ H[WUDFW %3(  DQG DOO H[SHULHQFHG
LQKLELWLRQ RI SUROLIHUDWLRQ ,Q WKH SUHVHQFH RI %3( DW  [  0 SKHQRO UHG WKH FHOOV
GHPRQVWUDWHGDQDSSDUHQWQHXWUDOL]DWLRQRIWKHSKHQROUHGLQKLELWRU\HIIHFW



)LJXUH5HVSRQVHVRIIRXUGLIIHUHQWVWUDLQVRI1+%(WRYDULRXVFRQFHQWUDWLRQVRIRQH
 
ORWRISKHQROUHG7KHVHFHOOVZHUHLQRFXODWHGDW FHOOVFP DQGNHSWLQFXOWXUHIRUILYHWR
VHYHQ GD\V 7KH FHOOV ZHUH FXOWXUHG LQ WKH DEVHQFH RI DQ\ XQGHILQHG FRPSRQHQWV ,Q HDFK
VWUDLQSKHQROUHGGHPRQVWUDWHGDWR[LFHIIHFWDWWKHUHFRPPHQGHGFRQFHQWUDWLRQRQWKH[
D[LV [0 7KHDGGLWLRQRIERYLQHSLWXLWDU\H[WUDFW %3( DW[0SKHQROUHG
UHVXOWHGLQDQLQFUHDVHLQSUROLIHUDWLRQ7KLVYDOXHLVGHSLFWHGLQEUDFNHWVDVDSHUFHQWRIWKH
YDOXHLQWKHDEVHQFHRI%3(4XDQWLWDWLRQZDVSHUIRUPHGDVGHVFULEHGLQ)LJXUH

*HQWDPLFLQ

*HQWDPLFLQ EHORQJV WR WKH DPLQRJO\FRVLGH IDPLO\RIDQWLELRWLFV7KHVHDQWLELRWLFV DUH
QHSKURWR[LQVLQYLYRDQGLQYLWUR+RZHYHUWR[LFLW\LVQRWH[FOXVLYHO\ORFDOL]HGWRWKHNLGQH\
WKHHDUKHDUWDQGWKHFRUQHDKDYHDOOGHPRQVWUDWHGVXVFHSWLELOLW\


ϭϬϵ

 
)LJXUH  7KH UHVSRQVH RI 1+%( WR YDULRXV FRQFHQWUDWLRQV RI JHQWDPLFLQ IURP WZR

GLIIHUHQWORWV7KHVHFHOOVZHUHLQRFXODWHGDWFHOOVFP DQGOHIWLQFXOWXUHIRUVHYHQGD\V
ZLWKRXWDPHGLXPFKDQJH7KHUHZHUHQRXQGHILQHGFRPSRQHQWVLQWKHPHGLXP2QHORWRI
JHQWDPLFLQGHPRQVWUDWHGWR[LFLW\ZKLOHWKHRWKHUGLGQRW(DFKORWRIJHQWDPLFLQQHHGVWREH
HYDOXDWHGIRUWR[LFLW\4XDQWLWDWLRQZDVSHUIRUPHGDVGHVFULEHGLQ)LJXUH

7KH PHFKDQLVPV RI WR[LFLW\ UDQJH IURP IUHH UDGLFDO IRUPDWLRQ WR FDOFLXP WUDQVSRUW
LQKLELWLRQ +HSDWRF\WHPHWDEROLF FRQYHUVLRQ RI JHQWDPLFLQ WR D FRPSRXQG WR[LF WR VHQVRU\
FHOOV IURP WKH LQQHU HDU LV DQRWKHU PHFKDQLVP RI WR[LFLW\ *HQWDPLFLQ LV WR[LF LQ YLWUR WR
FRUQHDO HSLWKHOLDO FHOOV ILEUREODVWV DQG KHSDWRF\WHV 7KH LQIOXHQFH RI WZR GLIIHUHQW ORWV RI
JHQWDPLFLQ RQ WKHSUROLIHUDWLRQ RI 1+%( LV VKRZQ LQ )LJXUH  LQGLFDWLQJ WKDW RQH ORW ZDV
LQKLELWRU\

+(3(6

+(3(6  K\GUR[\HWK\O SLSHUD]LQHHWKDQHVXOIRQLFDFLG LVD]ZLWWHULRQLFRUJDQLF
FKHPLFDO EXIIHULQJ DJHQW RQH RI WKH WZHOYH *RRG¶V EXIIHUV +(3(6 LV ZLGHO\ XVHG LQ FHOO
FXOWXUHODUJHO\EHFDXVHLWLVEHWWHUDWPDLQWDLQLQJSK\VLRORJLFDOS+GHVSLWHFKDQJHVLQFDUERQ
GLR[LGH FRQFHQWUDWLRQ SURGXFHG E\ FHOOXODU UHVSLUDWLRQ  ZKHQ FRPSDUHG WR ELFDUERQDWH
EXIIHUV ZKLFKDUHDOVRFRPPRQO\XVHG LQFHOO FXOWXUH 7KH GLVVRFLDWLRQ RI ZDWHU GHFUHDVHV
ZLWK IDOOLQJ WHPSHUDWXUH EXW WKH GLVVRFLDWLRQ FRQVWDQWV S.  RI PDQ\ RWKHU EXIIHUV GR QRW
FKDQJHPXFKZLWKWHPSHUDWXUH+(3(6LVOLNHZDWHULQWKDWLWVGLVVRFLDWLRQGHFUHDVHVDVWKH
WHPSHUDWXUHGHFUHDVHV7KLVPDNHV+(3(6DPRUHHIIHFWLYHEXIIHULQJDJHQWIRUPDLQWDLQLQJ
HQ]\PHVWUXFWXUHDQGIXQFWLRQDWORZWHPSHUDWXUHV

+(3(6KDVEHHQXVHGH[WHQVLYHO\LQFHOOFXOWXUHGXHWRLWVH[FHOOHQWEXIIHULQJFDSDFLW\
LQ WKH SK\VLRORJLFDO UDQJH DQG ORZ ELQGLQJ RI FDWLRQV EXW LW FDQ EH WR[LF )RU H[DPSOH
F\WRSODVPLF YDFXROHV GHYHORSHG LQ FKLFN HPEU\R HSLSK\VHDO FKRQGURF\WHV DQG PHPEUDQH
LQFOXVLRQ ERGLHV LQ KXPDQ GHUPDO ILEUREODVWV WKDW UHVROYHG ZKHQ +(3(6 ZDV UHSODFHG E\
DQRWKHUEXIIHU

7KHWR[LFLW\H[KLELWHGE\+(3(6DSSHDUVWREHPHGLDWHGE\WKHSURGXFWLRQRIUHDFWLYH
R[\JHQVSHFLHV7KHLQWHUDFWLRQRI+(3(6EXIIHUHGFXOWXUHPHGLXPZLWKIOXRUHVFHQWOLJKWDW

ϭϭϬ

URRP WHPSHUDWXUH UHVXOWHG LQ WR[LFLW\ WR 9 &KLQHVH KDPVWHU FHOOV 7KH WR[LFLW\ ZDV
SUHYHQWHGE\ VKLHOGLQJ RU WKH LQFOXVLRQ RIFDWDODVH LQWKHPHGLXPLPSOLFDWLQJH[WUDFHOOXODU
K\GURJHQSHUR[LGHDVWKHWR[LFDJHQW,QHQGRWKHOLDOFHOOV+(3(6VWLPXODWHVWKHSURGXFWLRQ
RIWR[LFR[\JHQPHWDEROLWHVUHVXOWLQJLQDGHFUHDVHLQJURZWK4XLQLVDWUDQVLWLRQPHWDOLRQ
FKHODWRU WKDW SRWHQWLDWHV LURQGULYHQ R[LGDQW IRUPDWLRQ 2[LGDQWV ZHUH GHWHFWHG LQ +HSFV
EXIIHU 6,1 LV DQ R[LGHUHOHDVLQJ FRPSRXQG DQG LWV WR[LFLW\ WR / FHOOV LV GXH WR D
FRRSHUDWLYH DFWLRQ RI K\GURJHQ SHUR[LGH DQG UHDFWLYH QLWURJHQ VSHFLHV LQ WKH SUHVHQFH RI
+(3(6

/LJKW

)OXRUHVFHQW OLJKW FDQ FDXVH WKH GHWHULRUDWLRQ RI WLVVXH FXOWXUH PHGLXP UHVXOWLQJ LQ
WR[LFLW\ DQG PXWDJHQLFLW\ 7KH GHOHWHULRXV HIIHFWV DUH GXH WR SURORQJHG H[SRVXUH ZKHUHDV
VKRUWH[SRVXUHVFDQSURGXFHDPLWRJHQLFHIIHFW7KHSKRWRWR[LFLW\LVGXHWRZDYHOHQJWKVRI
OLJKW WKDWFDQ EHDEVRUEHG E\ ULERIODYLQ7KH SDLULQJ RIULERIODYLQZLWKWU\SWRSKDQ+(3(6
DQG JXDQLQH UHVXOWV LQ WR[LFLW\ PHGLDWHG E\ UHDFWLYH R[\JHQ VSHFLHV 7U\SWRSKDQ DQG
ULERIODYLQ DUH IRXQG LQ FRQYHQWLRQDO DQG VHUXPIUHH RSWLPL]HG PHGLD DQG EHFDXVH WKH\ DUH
HVVHQWLDOWKH\ZLOOEHLQFOXGHGLQDOOQHZO\GHVLJQHGPHGLD/LPLWHGH[SRVXUHWRIOXRUHVFHQW
OLJKW GXULQJ PDQXIDFWXUH DQG VWRUDJH LV FULWLFDO 6SHFLDOO\ GHVLJQHG IOXRUHVFHQW WXEHV QRW
HPLWWLQJWKHUHOHYDQWZDYHOHQJWKVRUVKLHOGVWREORFNWKRVHZDYHOHQJWKVDUHDYDLODEOH

3XULW\RIFRPSRQHQWV

,QFHOOFXOWXUHWKHODUJHVWFRPSRQHQWRIWKHV\VWHPLVZDWHU&RQVHTXHQWO\DUHODWLYHO\
VPDOO FRQWDPLQDQW LQ WKH ZDWHU FDQ KDYHD VLJQLILFDQWHIIHFW RQWKH FHOOV &RQYHUVHO\ ZDWHU
PD\SURYLGHHVVHQWLDOQXWULHQWVWKDWEHFRPHOLPLWLQJDVWKHSXULW\RIZDWHULVLQFUHDVHG2QH
FODVV RI QXWULHQWV WKDW FRXOG DFFRXQW IRU WKLV SKHQRPHQRQ LV WKH WUDFH PHWDOV ,GHDOO\ LQ
FKHPLFDOO\ GHILQHG PHGLD DOO WKH FRPSRQHQWV DUH NQRZQ DQG WKHUH DUH QR FRQWDPLQDQWV
SUHVHQW7KRXJKWKHDYDLODELOLW\RIUHFRPELQDQWSURWHLQVDQGSHSWLGHVKDVPDGHWKHSXUVXLWRI
FKHPLFDOO\ GHILQHG PHGLD PRUH DWWDLQDEOH PRVW IDOO VKRUW RI WKLV LGHDO &HOOV PD\ QHHG
DOEXPLQRURWKHUVHUXPIUDFWLRQVIRUWKHGHVLUHGSHUIRUPDQFHRUVWDELOLW\$OVRPDQXIDFWXUHUV
PD\QRWQHFHVVDULO\VFUHHQIRUDOOSRWHQWLDOFRQWDPLQDQWVLQWKHLURUJDQLFFRPSRXQGVVXFKDV
VHOHQLXP FRQWDPLQDWLRQ RI D WK\UR[LQH SUHSDUDWLRQ 7KH PDQ\ VXUIDFHV ZLWK ZKLFK WKH
PHGLXP FRPSRQHQWV FRPH LQ FRQWDFW GXULQJ PDQXIDFWXULQJ PD\ FRQWULEXWH FRQWDPLQDQWV
7KH ELRSURFHVVLQJLQGXVWU\LVUHGHILQLQJWKHQRWLRQ RISXULW\ GXH WR WKHSRWHQWLDO LQIHFWLRXV
DJHQWVWKDWPD\EHSUHVHQWLQPHGLXPFRPSRQHQWV,WLVGHVLUDEOHWKDWDOOFRPSRQHQWVDUHRI
QRQDQLPDORULJLQ)RUH[DPSOHPHWKLRQLQHDQGF\VWHLQHDUHJHQHUDOO\LVRODWHGIURPDQLPDO
KDLUVRQHZVRXUFHVDUHUHTXLUHG

)DWW\DFLGV

6HUXP SURYLGHV OLSLGV LQ YDULRXV IRUPV WR FXOWXUHG FHOOV 7KHVH IRUPV LQFOXGH
FKROHVWHURO SKRVSKROLSLGV WULJO\FHULGHV IDWW\ DFLGV IDW VROXEOH YLWDPLQV DQG YDULRXV
HVWHULILHG IRUPV RI WKHVH OLSLGV 7KH HVVHQWLDO IDWW\ DFLGV WKDW FDQQRW EH V\QWKHVL]HG E\
DQLPDOVDUHQDQGQ  UHIHUVWRWKHQXPEHURIFDUERQDWRPVDQGWKHQXPEHU
IROORZLQJ WKH FRORQ UHIHUV WR WKH WRWDO QXPEHU RI GRXEOH ERQGV LQ WKH PROHFXOH 7DEOH  
$QLPDOV GR QRW FRQWDLQ WKH HQ]\PHV QHFHVVDU\ WR SODFH D GRXEOH ERQG LQ WKHVH SRVLWLRQV
&RQVHTXHQWO\WKHDFTXLVLWLRQRIWKHVHPROHFXOHVRFFXUVRQO\WKURXJKDQH[RJHQRXVVXSSO\
KRZHYHUDQLPDOV H[FOXGLQJWUXHFDUQLYRUHV FRQWDLQGHVDWXUDWLRQDQGHORQJDWLRQVKRUWHQLQJ
HQ]\PHV WKDW UHVXOW LQ SRO\XQVDWXUDWHG IDWW\ DFLGV PRVW QRWDEO\ DUDFKLGRQLF DFLG Q

ϭϭϭ

DQG HLFRVDSHQWHQRLF DFLG Q DQG IDWW\ DFLGV RI KLJKHU GHJUHHV RI XQVDWXUDWLRQ DQG
HORQJDWLRQ


7DEOH  )DWW\ DFLG FRPSRVLWLRQ RI SKRVSKDWLG\OFKROLQH RI QRUPDO KXPDQ
ILEUREODVWVVXSSOHPHQWHGZLWKYDULRXVIDWW\DFLGV
6XSSOHPHQWDWLRQE
)DWW\DFLGF Q Q Q
 G  H
Q   
OQ   
   
OQ   
Q   
Q   
Q   
OQ   
Q   
Q   
Q   
Q   
Q   
Q   
Q   
Q   
Q   
Q   
'HJUHHVRIVDWXUDWLRQD   
6DWXUDWHG   
0RQRXQVDWXUDWHG   
3RO\XQVDWXUDWHG   

D
7KLV OHYHO RI )%6 ZDV LQVXIILFLHQW WR VXSSO\ WKH UHTXLUHG IDWW\ DFLGV IRU WKHVH ILEUREODVWV
XQGHU WKHVH FRQGLWLRQV &RQVHTXHQWO\ WKH FHOOV GLVSOD\HG DQ HVVHQWLDO IDWW\ DFLG GHILFLHQF\
SURILOH QRWVKRZQ VLPLODUWRWKDWGLVSOD\HGE\WKHFHOOVVXSSOHPHQWHGZLWKWKHOQIDWW\
DFLG6XEVHTXHQWO\WKHFHOOVZHUHVXSSOHPHQWHGZLWKSXUHIDWW\DFLGVFRPSOH[HGWRIDWW\DFLG
GHSOHWHGERYLQHVHUXPDOEXPLQIRUVHYHUDOGD\V

E
$IWHU WKH ILEUREODVWV ZHUH FXOWXUHG LQ DQ HVVHQWLDO IDWW\ DFLG GHILFLHQW HQYLURQPHQW WKH
PHGLXP ZDV VXSSOHPHQWHG IRU VHYHUDO GD\V ZLWK OQ Q DQG Q IDWW\ DFLGV
FRPSOH[HGWRIDWW\DFLGGHSOHWHG ERYLQH VHUXP DOEXPLQ 7KH SKRVSKROLSLGVZHUHH[WUDFWHG
SKRVSKDWLG\OFKROLQHSXULILHGDQGWKHIDWW\DFLGVRIWKDWSKRVSKROLSLGHYDOXDWHGDVIDWW\DFLG
PHWK\OHVWHUVE\*/&

F
)DWW\DFLGVDUHGHVLJQDWHGE\WKHQXPEHURIFDUERQDWRPV ILUVWWZRQXPEHUV WKHQXPEHURI
GRXEOH ERQGV LQ WKH PROHFXOH WKH QXPEHU DIWHU WKHFRORQ  DQG RQ ZKLFK FDUERQ DWRP WKH
ILUVW GRXEOH ERQG LV IURP WKH ODVW QWK  FDUERQ QSRVLWLRQ RI FDUERQ DWRP  LQ WKH IDWW\ DFLG
PROHFXOHSUHYLRXVO\QDPHGWKHRPHJDFDUERQ


ϭϭϮ

G
9DOXHVDUHH[SUHVVHGDVWKHQPROHRIWRWDOIDWW\DFLGV

H
7KLVUHSUHVHQWVWKHVXPRIWKHQPROHRIWKHIDWW\DFLGVIRUHDFKGHVLJQDWLRQ

7KHUHPRYDORIVHUXPFDQUHVXOWLQDQHVVHQWLDOIDWW\DFLGGHILFLHQF\EHFDXVHVHUXPLV
WKH SUHGRPLQDQW OLSLG VRXUFH IRU FXOWXUHG FHOOV ,Q WKH DEVHQFH RI D OLSLG VRXUFH FHOOV ZLOO
V\QWKHVL]H GHVDWXUDWH DQG HORQJDWH IDWW\ DFLGV RI WKH Q DQG Q IDPLOLHV 8QGHU WKHVH
GHILFLHQF\ FRQGLWLRQV WKHUH LV D FKDUDFWHULVWLF IDWW\ DFLG SURILOH UHSUHVHQWHG E\ WKH
SRO\XQVDWXUDWHGIDWW\DFLGVRIWKHQDQGQIDPLOLHV&XOWXUHGFHOOVZLOOXWLOL]HH[RJHQRXV
IDWW\ DFLGV SUHIHUHQWLDOO\ WR HQGRJHQRXVO\ V\QWKHVL]HG RQHV 7KH YDULRXV IDWW\ DFLG IDPLOLHV
DUH PHWDEROL]HG E\ WKH VDPH HQ]\PHV EXW DW GLIIHUHQW UDWHV 7KH HVVHQWLDO IDWW\ DFLGV DUH
SUHIHUHQWLDOO\ PHWDEROL]HG RYHU WKH QRQHVVHQWLDO IDWW\ DFLG IDPLOLHV 7KLV VLWXDWLRQ FDQ EH
H[SORLWHGWRJHQHUDWHFHOOVZLWKDIDWW\DFLGSURILOHIDYRXULQJDSDUWLFXODUIDWW\DFLGIDPLO\ 
7DEOH 3RO\XQVDWXUDWHGIDWW\DFLGVKDYHDQH[WHQVLYHPHWDEROLVPJHQHUDWLQJHLFRVDQRLGV
HSR[LGHV ZLWK YDVFXODU IXQFWLRQ DQDQGDPLGH D OLJDQG RI WKH FDQQDELQRLG UHFHSWRUV  DQG
QRQHQ]\PDWLF R[LGDWLRQ SURGXFWV RI Q WKH LVRSURVWDQHV ZKLFK DUH LVRPHUV RI
SURVWDJODQGLQV3RO\XQVDWXUDWHGIDWW\DFLGVDOVRKDYHIXQFWLRQVWKDWUHVXOWIURPWKHIDWW\DFLG
DQG QRW LWV PHWDEROLF SURGXFW )RU H[DPSOH LQWUDFHOOXODU DUDFKLGRQLF DFLG RSHQHG D
SRWDVVLXPVHOHFWLYH FKDQQHO LQ QHRQDWDO UDW DWULDO FHOOV DQG XQGHU VRPH FRQGLWLRQV
H[WUDFHOOXODU DUDFKLGRQLF DQG GRFRVDKH[DQRLF Q  DFLGV EORFNHG WKH PDMRU YROWDJH
GHSHQGHQW SRWDVVLXP FKDQQHO .Y O  LQ FDUGLDF FHOOV )DWW\ DFLGV FDQ DOVR LQIOXHQFH WKH
SK\VLFDO FKDUDFWHULVWLFV RI WKH PHPEUDQH E\ LQIOXHQFLQJ LWV IOXLGLW\ 3RO\XQVDWXUDWHG IDWW\
DFLGV FDQ LQFUHDVH WKH PHPEUDQH IOXLGLW\ DV LQ -$ FHOOV DQG GHFUHDVH WKH XSWDNH RI
DFHW\ODWHGORZGHQVLW\OLSRSURWHLQ7KHIDWW\DFLGFRPSRVLWLRQRIQRUPDOKXPDQILEUREODVWVLQ
YLWURLVGHPRQVWUDWHGLQ7DEOH7KHVXSSOHPHQWHGIDWW\DFLGLVUHSUHVHQWHGWRDODUJHH[WHQW
LQ WKH SKRVSKDWLG\OFKROLQH 3&  RI ILEUREODVWV 7KH FHOOV DUH FDSDEOH RI PHWDEROL]LQJ WKH
SUHFXUVRUIDWW\ DFLG E\ HORQJDWLRQ DQG GHVDWXUDWLRQWRRWKHUIDWW\ DFLGV&HOOVZLWKGLIIHUHQW
IDWW\DFLGFRPSRVLWLRQVPD\EHIXQFWLRQDOO\GLIIHUHQW

,W PD\ EH WHPSWLQJ WR FRQVLGHU WKH UHPRYDO RI VHUXP WKH ILQDO VWHS LQ WKH SURFHVV RI
JHQHUDWLQJ D VFUXPIUHH PHGLXP EXW FDUH PXVW EH WDNHQ WR FRQVLGHU WKH IDWW\ DFLG
FRPSRVLWLRQRIWKHFHOOV

5HIHUHQFHV

$GHROD2<RXQJ/*0F%ULGH%:DQG%DOO52  %U-1XOU
%HVVKR77DQR.1LVKPXUD6DQG.DVDL+  &DUFLQRJHQHVLV
%LQGDO5'DQG.DW]HQHOOHQERJHQ-$  -0HG&KHP
%RZPDQ&0%HUJHU(0%XWOHU(17RWK.0DQG5HSLQH-(  ,Q9LWUR
&HOO'HY%LRO
%UDGOH\02DQG6KDUNH\1$  1DWXUH
%XUNH0'DQG0D\HU57  &KHP%LRO,QWHUDFW
%XUNH0'7KRPSVRQ6:HDYHU5-:ROI&5DQG0D\HU57  %LRFKHP
3KDUPDFRO
&DUWZULJKU(&DQG'DQNV'0  %LRFKLP%LRSK\V$FWD
&KULVWHQVHQ+1  3K\VLRO5HY
&RQORQ%-$UDQ-0(UUH-3DQG6PLWK':  +HDU5HV
&UDQQ6$+XDQJ0<0F/DUHQ-'DQG6FKDFKW-  %LRFKHP3KDUPDFRO


ϭϭϯ

&ULELHU60RUURW*DQG=DFKRZVNL$  3URVWDJODQGLQV/HXNRWULHQHVDQG(VVHQWLDO
)DWW\$FLGV
&URQLQ5(  &OLQ1HSKURO
(GZDUGV $ 0 6LOYD ( -RIUH % %HFKHU 0 / DQG 'H ORDQQHV $ (  
-3KRWRFKHP3KRWRELRO
*DOOL&DQG0DUDQJRQL)  1XWULWLRQ
*DOOL&0DUDQJRQL)*DOHOOD*  3URVWDJODQGLQVOHXNRWULHQHVDQG(VVHQWLDO)DWW\
$FLGV
*RRG1(:LQJHW*7:LQWHU:&RQQROO\71,]DZD6DQG6LQJK50  
%LRFKHPLVWU\
*UDG\ / + 1RQQFPDQ ' - 5RWWLQJKDXV * ( DQG :HWVKRQV : 9  
(QGRFULQRORJ\
*UDPPDWLNRV 6 , 6XEEDLDK 3 9 9LFWRU 7 $ DQG 0LOOHU : 1   $QQ 1
<$FDG6FL
+DNYRRUW$+DVHOEDFK0DQG*DOOD+-  %UDLQ5HV
+DNYRRUW $ +DVHOEDFK 0 :HJHQHU - +RKHLVHO ' DQG *DOOD + - 6  -
1HXURFKHP
+DP5*+DPPRQG6/DQG0LOOHU//  ,Q9LWUR
+DPLOWRQ:*DQG+DP5*  ,Q9LWUR
+DVDQ\60DQG%DVX3.  /HQV(\H7R[LF5HV
+HQGU\3-7DLWKPDQ*&7DLFKPDQ6-DQG.HRQ:-  &DQ-&DUGLRO

+LQRMRVD5DQG/HUQHU6$  -,QIHFW'LV
+RQRUH(%DUKDQLQ-$WWDOL%/HVDJH)DQG/D]GXQVNL0  3URF1DWO$FDG
6FL86$
+RSS/DQG%XQNHU&+  -&HOO3K\VLRO
.DW]HQHOOHQERJHQ % 6 1RUPDQ 0 - (FNHUW 5 / 3HOW] 6 : DQG 0DQJHO : (
 &DQFHU5HV
.LP'DQG&ODSKDP'(  6FLHQFH
/DVV - + 0DFN 5 - ,PSHULD 3 6 0DOOLFN . DQG /D]DUX + 0   &XUU (\H
5HV
/RPRQRVRYD((.LUVFK05DXHQ8DQGGH*URRW+  )UHH5DGLF%LRO0HG

/XELQ0  ,Q9LWUR&HOO'HY%LRO$QLP$
0F%ULGH%:DQG(DUO\5-  %U-1XWU
0F.FHKDQ:/DQG+DP5*  1DWXUH
0RQWHLO&/HFOHUH&)LOODVWUH-3DQG0RULQ-3  5HQ)DLO
3DUVKDG5DQG6DQIRUG..  -&HOO3K\VLRO
3HHKO'0DQG+DP5*  ,Q9LWUR
3HWUXVFKND/5HEULQ,*ULPP8DQG+HUPDQ)+  &OLQ&KLP$FWD
3RQJUDF-/DQG5\OHWW5-  -1HXURVFL0HWKRGV
3RROH&$5HLOO\+&DQG)OLQW0+  ,Q9LWUR
5RVHQWKDO0'  3URJ/LSLG5HV
6DOHP1-U:HJKHU%0HQD3DQG8DX\5  3URF1DWO$FDG6FL86$

6DQGVWURP % ( *UDQVWURP 0 DQG 0DUNOXQG 6 /   IUHH 5DGLF %LRO 0HG 

6DUGHVDL:  1XWU&OLQ3UDFW
6FKZDUW] = 1DVDW]N\ ( %URRNV % 3 6RVNROQH : $ DQG %R\DQ % '  
(QGRFULQRORJ\

ϭϭϰ

6FKZHUW]':.UHLVEHUJ-,DQG9HQNDWDFKDODP0$  -3KDUPDFRO([S7KHU

6KLFKLUL*.LQRVKLWD0DQG6DHNL<  $UFK%LRFKHP%LRSK\V
6KLSOH\*'DQG+DP5*  ,Q9LWUR
6LOYD(8JDUWH5$QGUDGH$DQG(GZDUGV$0  -3KRWRFKHP3KRWRELRO

6WROO/7DQG6SHFWRU$$  ,Q9LWUR
7XONHQV3DQG9RQ+RRI)  7R[LFRORJ\
8KOHQGRUI%:DQG0XGG6+  6FLHQFH
9HUGHU\5%1LVW&)XMLPRWR:<:LJKW71DQG*ORPVHW-$  ,Q9LWUR

:HLQEHUJ - 0 6LPPRQV ) -UDQG +XPHV + '   5HV &RPPXQ &KHP 3DWKRO
3KDUPDFRO
=LHJHU0$*ORIFKHVNL'-/HSRFN-5DQG.UXXY-  &U\RELRORJ\
=LJOHU-6/HSH=XQLJD-/9LVWLFD%DQG*HU\,  ,Q9LWUR&HOO'HY%LRO



































ϭϭϱ

 &KDSWHU
7KUHHGLPHQVLRQDOFXOWXUH

,QWURGXFWLRQ

7KUHHGLPHQVLRQDO '  FHOO FXOWXUHV KDYH EHHQ ZLGHO\ XVHG LQ ELRPHGLFDO UHVHDUFK
EHFDXVHWKHHDUO\GHFDGHVRIWKLVFHQWXU\+ROWIUHWHUDQGODWHU0RVFRQDSLRQHHUHGWKHILHOGE\
WKHLU UHVHDUFK RQ PRUSKRJHQHVLV XVLQJ VSKHULFDO UHDJJUHJDWHG FXOWXUHV RI HPEU\RQLF RU
PDOLJQDQW FHOOV 1XPHURXV VXEVHTXHQW LQ YLWUR VWXGLHV RQ RUJDQRJHQHVLV RU H[SUHVVLRQ RI
PDOLJQDQF\ZHUHEDVHGRQWKHVHHDUO\LQYHVWLJDWLRQV6XEVWDQWLDOQRYHOLQSXWLQWRUHVHDUFKRQ
FHOODJJUHJDWHVFDPHIURPIXQGDPHQWDOVWXGLHVRI6XWKHUODQGDQGDVVRFLDWHV7KH\SLRQHHUHG
PXOWLFHOOXODU WXPRXU VSKHURLGV 0&76  DV DQ LQ YLWUR PRGHO IRU VWXGLHV RQ WXPRXU FHOO
UHVSRQVH WR WKHUDS\ 0&76 KDYH DOVR EHHQ XVHG WR VWXG\ EDVLF ELRORJLFDO PHFKDQLVPV
LQFOXGLQJ WKH UHJXODWLRQ RI SUROLIHUDWLRQ GLIIHUHQWLDWLRQ FHOO GHDWK LQYDVLRQ DQJLRJHQHVLV
DQGWKHLPPXQHUHVSRQVH

2QHPDMRUDGYDQWDJHRI'FHOOFXOWXUHVLVWKHLUZHOOGHILQHGJHRPHWU\ZKHWKHUSODQDU
RU VSKHULFDOZKLFK PDNHV LW SRVVLEOH WR GLUHFWO\ UHODWH VWUXFWXUH WR IXQFWLRQ DQG ZKLFK
HQDEOHV WKHRUHWLFDO DQDO\VHV IRU H[DPSOH RI GLIIXVLRQ ILHOGV &RPELQLQJ VXFK DSSURDFKHV
ZLWKPROHFXODUDQDO\VLVKDVGHPRQVWUDWHGWKDWLQFRPSDULVRQWRFRQYHQWLRQDOFXOWXUHVFHOOV
LQ ' FXOWXUH PRUH FORVHO\ UHVHPEOH WKH LQ YLYR VLWXDWLRQ ZLWK UHJDUG WR FHOO VKDSH DQG
FHOOXODUHQYLURQPHQWDQGWKDWVKDSHDQGHQYLURQPHQWFDQGHWHUPLQHJHQHH[SUHVVLRQDQGWKH
ELRORJLFDO EHKDYLRXU RI WKH FHOOV 2QH LPSUHVVLYH H[DPSOH LV WKH HFWRSLF LPSODQWDWLRQ RI
HPEU\RQLF FHOOV ZKLFK FDQ UHVXOW LQ PDOLJQDQW WUDQVIRUPDWLRQ ZKHUHDV WKH VDPH FHOOV
XQGHUJRQRUPDOHPEU\RJHQHVLVLQWKHXWHUXV&RQYHUVHO\WHUDWRFDUFLQRPDFHOOVPD\XQGHUJR
QRUPDO GHYHORSPHQW ZKHQ LPSODQWHG LQWR DQ HPEU\R 2QH IXUWKHU H[DPSOH LV WKH UHODWLYH
UHVLVWDQFH RI FDQFHU FHOOV WR GUXJV LQ ' FXOWXUH FRPSDUHG WR WKH VDPH FHOOV JURZQ DV
FRQYHQWLRQDOPRQROD\HURULQVLQJOHFHOOVXVSHQVLRQ

0XOWLFHOOXODUWXPRXUVSKHURLGV 0&76 
0&76PRQRFXOWXUHV
7KHKLVWRU\RI0&76DQGWKHLUUHOHYDQFHWRVROLGWXPRXUV

0XOWLFHOOXODU WXPRXU VSKHURLGV 0&76  PLPLF VROLG WXPRXUV EHWWHU WKDQ PRQROD\HU
FXOWXUHV 0&76 KDYH VLJQLILFDQWO\ LQFUHDVHG RXU NQRZOHGJH RI UDGLDWLRQ UHVSRQVH RI
PDPPDOLDQ FHOOV LQWHUFHOOXODU FRPPXQLFDWLRQ FHOO LQYDVLRQ DQJLRJHQHVLV DQG
QHRYDVFXODUL]DWLRQ$OWKRXJKDWWHPSWVWRLQLWLDWHVSKHURLGVGLUHFWO\IURPELRSVLHVIRUURXWLQH
LQGLYLGXDOSUHGLFWLYHGUXJWHVWLQJKDGOLWWOHVXFFHVV0&76IURPHVWDEOLVKHGFHOOOLQHVSURYLGH
DQLQYLWURPRGHOWRVWXG\PHFKDQLVPVFRQWUROOLQJGUXJSHQHWUDWLRQELQGLQJDQGDFWLRQ,Q
WHUPVRIWKUHHGLPHQVLRQDOJURZWK0&76EHKDYHOLNHWKHLQLWLDODYDVFXODUVWDJHVRIVROLG
WXPRXUVLQYLYRXQYDVFXODUL]HGPLFURPHWDVWDWLFIRFLRULQWHUFDSLOODU\WXPRXUPLFURUHJLRQV
DVVKRZQLQ)LJXUH*URZWKNLQHWLFVFDQEHGHVFULEHGE\WKH*RPSHUW]HTXDWLRQZKLFKKDV
EHHQVKRZQWRPRGHOWKUHHGLPHQVLRQDOLQYLYRDQGLQYLWURJURZWKUHDVRQDEO\ZHOO0&76
GHYHORSGLVFUHWHFHOOSRSXODWLRQVVLPLODUWRWKRVHIRXQGLQPLFURUHJLRQVRIVROLGWXPRXUVZLWK
WKUHHPDMRUJURXSVDFWLYHO\F\FOLQJFHOOVFORVHVWWRWKHEORRGDQGQXWULHQWVXSSO\TXLHVFHQW
\HW LQWDFW DQG YLDEOHFHOOV DV LQWHUPHGLDWHV DQG QHFURWLF FHOOVDUHDVIXUWKHVWIURPWKH EORRG
VXSSO\ )LJXUH   %H\RQG D FULWLFDO VL]H !  —P  PRVW VSKHURLGV IURP HVWDEOLVKHG FHOO
OLQHV GHYHORS PDVVLYH QHFURVLV LQ WKH FHQWUH VXUURXQGHG E\ D YLDEOH ULP RI FHOOV ZLWK D
WKLFNQHVVRI—P

ϭϭϲ

 


)LJXUH D 6FKHPDWLFLOOXVWUDWLRQRIWKHGLIIHUHQWVWDJHVRIVROLGWXPRXUJURZWKWKDW
FDQ EH PDWKHPDWLFDOO\ GHVFULEHG E\ WKH *RPSHUW] IXQFWLRQ E  5HSUHVHQWDWLYH VSKHURLG
YROXPH JURZWK NLQHWLFV RI WZR GLIIHUHQW KXPDQ EUHDVW FDQFHU FHOO OLQHV JURZQ LQ OLTXLG
RYHUOD\ FXOWXUH LQ FRQYHQWLRQDO VXSSOHPHQWHG PHGLD /LQHV VKRZ QRQOLQHDU OHDVW VTXDUHV
EHVWILWVWRWKH*RPSHUW]IXQFWLRQZLWK9 [$ DQG% IRU%7
FHOOVDQG9 [$ DQG% IRU7'FHOOV



)LJXUH  6FKHPDWLF LOOXVWUDWLRQ RI WKH DQDORJ\ EHWZHHQ WXPRXU PLFURUHJLRQV DQG
PXOWLFHOOXODUWXPRXUVSKHURLGV

&XUUHQWUHVHDUFKZLWK0&76PRQRFXOWXUHV

0DQ\RIWKHHDUO\ILQGLQJVZLWKWKH9 &KLQHVHKDPVWHUOXQJFHOOV DQGWKH(07
PRXVHVDUFRPD VSKHURLGPRGHOVZHUHVXSSRUWHGE\VXEVHTXHQWVWXGLHVZLWKKXPDQWXPRXU
FHOOOLQHV1HFURWLFFHOOGHDWKLQWKHVSKHURLGFHQWUHPDLQO\UHODWHVWRWKHOLPLWHGLQZDUGDQG
RXWZDUG GLIIXVLRQ )LJXUH   7KXV LQ VRPH WXPRXU VSKHURLG W\SHV VXFK DV :L'U KXPDQ
FRORQ DGHQRFDUFLQRPD  DQG 5DWO7O UDVWUDQVIHFWHG UDW HPEU\R ILEUREODVWV  QHFURVLV DQG
ϭϭϳ

K\SR[LDDUHFRLQFLGHQWDQGQHFURWLFFHOOGHDWKPLJKWEHH[SODLQHGE\DVLQJOHOLPLWLQJIDFWRU
,QFRQWUDVWWKHUHLVH[SHULPHQWDOHYLGHQFHIURPRWKHU0&76W\SHVWKDWQHFURVLVLVDFRPSOH[
PXOWLIDFWRULDO HYHQW ,QYHVWLJDWLRQV RQ PLFURHQYLURQPHQWDO DQG HSLJHQHWLF PHFKDQLVPV
LQYROYHGLQWKHUHJXODWLRQRIFHOOSUROLIHUDWLRQGLIIHUHQWLDWLRQDQGJHQHH[SUHVVLRQKDYHEHHQ
LQWHQVLILHGHQRUPRXVO\ZLWKLQWKHODVWWHQ\HDUV0DQ\FHOOW\SHVVHHPFDSDEOHRIPDLQWDLQLQJ
LQWUDFHOOXODU KRPHRVWDVLV LQ ' FXOWXUH XQWLO VKRUWO\ EHIRUH QHFURWLF FHOO GHDWK GHVSLWH
HQYLURQPHQWDO VWUHVV 7KHUH DUH DOPRVW QR VWUXFWXUDO RU PHWDEROLF PDUNHUV IRU WKLV SUH
QHFURWLF VWDJHH[FHSWIRUDUHGXFHGR[\JHQXSWDNHDQGRUUHVSLUDWRU\DFWLYLW\DQGDGHFUHDVH
LQ PLWRFKRQGULDO IXQFWLRQ &HOO F\FOH DUUHVW LQ WKH QXWULHQW GHSULYHG LQQHU UHJLRQV RI ODUJH
P\FUDVFRWUDQVIRUPHGUDWILEUREODVWVSKHURLGV 05 LVDFFRPSDQLHGE\DQXSUHJXODWLRQRI
WKH &'. LQKLELWRU S.LSO&LSO ZKLOH FHOO F\FOH DUUHVW LQ PRQROD\HU FXOWXUHV DQG LQ P\F
WUDQVIHFWHG QRQWXPRULJHQLF DJJUHJDWHV LV DVVRFLDWHG ZLWK HQKDQFHG H[SUHVVLRQ RI SOOQN
7KHVH GDWD VKRZHG IRU WKH ILUVW WLPH WKDW FHOO F\FOH FRQWURO GLIIHUV PHFKDQLVWLFDOO\ LQ
PRQROD\HU DQG VSKHURLG FXOWXUH DQG PD\ FKDQJH DW GLIIHUHQW VWDJHV RI PDOLJQDQW
WUDQVIRUPDWLRQ 'XH WR WKH PDVVLYH FHQWUDO QHFURWLF FHOO GHDWK LQ 0&76 SURJUDPPHG FHOO
GHDWK LQ ' DJJUHJDWHV KDV ORQJ EHHQ LJQRUHG +RZHYHU UHFHQW GDWD VKRZ WKDW DSRSWRVLV
RFFXUV LQ VSKHURLGV RI LQWHVWLQDO HSLWKHOLDO FHOOV *URZWK LQKLELWLRQ YLD VWLPXODWLRQ RI
DSRSWRVLVKDVDOVREHHQGHVFULEHGIRUSGHIHFWLYHKXPDQOXQJFDQFHUVSKHURLGVWUDQVIHFWHG
LQ VLWX ZLWK D YLUDO ZLOGW\SH S YHFWRU 0XHOOHU.OLHVHU UHSRUWHG DSRSWRWLF FHOO GHDWK RI
PXOWLQXFOHDWHGJLDQW FHOOV LQDKLJKO\GLIIHUHQWLDWHGUKDEGRP\RVDUFRPD VSKHURLG DQGLQ '
FXOWXUHV RI 9 FHOOV XVLQJ WKH 781(/ DVVD\ ' FXOWXUHV XQGHUJR PRUSKRORJLFDO DQG
IXQFWLRQDOUHRUJDQL]DWLRQ$PRQJVWWKHVHDFWLYLWHVDUH

D  0RGLILHG GHSRVLWLRQ DQGRU DVVHPEO\ RI ELR PDWUL[ VXFK DV WKH H[WUDFHOOXODU PDWUL[
PROHFXOHVILEUHQHFWLQFROODJHQW\SHV,,,,DQG,9RUODPLQLQ
E ([SUHVVLRQDQGIXQFWLRQRI(&0UHFHSWRUV LQWHJULQV UHFHSWRUVXEVHWVDQGVXEXQLWVDQG
FDGKHULQV
F  7KH H[SUHVVLRQ DQG IXQFWLRQ RI ELRORJLFDO UHVSRQVH PRGLILHUV VXFK DV JURZWK DQG
DQJLRJHQLFIDFWRUV LH(*)7*)FF9(*) DQGRUWKHLUUHFHSWRUV
G 7KHGHYHORSPHQWRIJDSMXQFWLRQDOFRPPXQLFDWLRQ

0&76FXOWXUH

$ FRPPRQ SULQFLSOH RI DOO VSKHURLG FXOWXUH PHWKRGV LV WKH SUHYHQWLRQ RI FHOOXODU
DWWDFKPHQW WRD VXEVWUDWH VXFK DV VXUIDFHV RI 3HWUL GLVKHV 0DQ\ QRQWUDQVIRUPHG DQG PRVW
PDOLJQDQW FHOOV WHQG WR IRUP VSKHULFDO DJJUHJDWHV XQGHU WKHVH FRQGLWLRQV 7KHUH DUH WZR
VWUDWHJLHVIRUFXOWLYDWLQJ0&76LQVWLUUHGPHGLXPDQGLQVWDWLFPHGLXP

7KH PRVW ZLGHO\ XVHG PHWKRG IRU JURZLQJ 0&76 IURP HVWDEOLVKHG FHOO OLQHV LV WKH
VSLQQHU IODVN FXOWXUH )LJXUH   :LWK WKLV WHFKQLTXH D ODUJH QXPEHU RI 0&76 PD\ EH
JHQHUDWHG VLPXOWDQHRXVO\ LQ ODUJH YROXPH FXOWXUHV DQG WKHVH FDQ EH VFDOHGXS WR PDVV
FXOWXUH:KLOHVRPHWXPRXUFHOOW\SHVDUHFDSDEOHRISURGXFLQJFHOODJJUHJDWHVGLUHFWO\IURP
VLQJOHFHOOVXVSHQVLRQVLQVSLQQHUIODVNVFHOOFHOOLQWHUDFWLRQDQGWKXVDJJUHJDWHIRUPDWLRQLV
RIWHQPRUHHIILFLHQWXQGHUVWDWLFFRQGLWLRQV$VDFRQVHTXHQFHEDFWHULRORJLFDO3HWULGLVKHVRU
DJDUDJDURVHFRDWHG FXOWXUH GLVKHV WR ZKLFK FHOOV GR QRW DGKHUH DUH RIWHQ XVHG WR LQLWLDWH
VSKHURLGIRUPDWLRQ
&HOOQXPEHUDQGLQLWLDWLRQ SHULRG DUH FULWLFDO YDULDEOHV ZKLFKGHSHQGRQWKHFHOOW\SH
DQG FXOWXUH FRQGLWLRQV PHGLXP VHUXP S+ HWF  ,Q JHQHUDO WKH FHOO QXPEHU LQRFXODWHG
YDULHV EHWZHHQ  [  DQG  [  H[SRQHQWLDOO\ JURZLQJ FHOOV SHU  PP GLVK 2QFH
DJJUHJDWHV KDYH HPHUJHG LQ WKH XQVWLUUHG PHGLXP ZLWKLQ WZR WR ILYH GD\V WKH\ FDQ EH

ϭϭϴ

WUDQVIHUUHGLQWRVSLQQHUIODVNV0HGLXPLVQRWUHIUHVKHGGXULQJWKHLQLWLDWLRQSHULRGZKHUHDV
LWLVUHQHZHGURXWLQHO\LQVSLQQHUFXOWXUHV$VVSKHURLGLQLWLDWLRQPD\OHDGWRWKHIRUPDWLRQRI
DJJUHJDWHV ZLWK D ODUJH YDULDELOLW\ LQ VL]H DQG DV VSKHURLGWRVSKHURLG FOXVWHUV PD\ RFFXU
VHOHFWLRQ RI D VSHFLILF VSKHURLG SRSXODWLRQ EHIRUH WKH WUDQVIHU LQWR VSLQQHU IODVN LV
UHFRPPHQGHG,IVHYHUDOVHOHFWLYHVHGLPHQWDWLRQVWHSVIRUH[DPSOH XVLQJ )DOFRQWXEHV DUH
QRW VXIILFLHQW WR HOLPLQDWH ODUJH FHOO FOXVWHUV DQG VLQJOH FHOOV KDQGVHOHFWLRQ RU UDSLG
KDUYHVWLQJRIVSKHURLGVE\VLHYLQJWKURXJKQ\ORQVFUHHQVFDQEHSHUIRUPHG7KHFRHIILFLHQW
RIYDULDWLRQRIWKHDYHUDJHVSKHURLGGLDPHWHUZLWKLQWKHVHOHFWHGVSKHURLGSRSXODWLRQVKRXOG
EH RWKHUIUHTXHQWO\ XVHG WHFKQLTXHV WR JHQHUDWHODUJH QXPEHUV RI VSKHURLGV DUH UROOHU WXEHV
DQG WKH J\UDWRU\ VKDNHU  PHWKRG VKRZQ LQ )LJXUH  $V IRU VSLQQHU IODVN FXOWXUHV DQ
LQLWLDWLRQ SHULRG XQGHU QRQVWLUULQJ FRQGLWLRQV PD\ EH UHTXLUHG DQG WKH PHGLXP VKRXOG EH
UHQHZHG URXWLQHO\ DIWHU WUDQVIHU LQWR WKH UROOHU WXEHV RU RQWR WKH J\UDWRU\ VKDNHU $OVR WR
JXDUDQWHH RSWLPXP FRQVWDQW VXSSO\ FRQGLWLRQV WKURXJKRXW VSKHURLG JURZWK WKH QXPEHU RI
FHOOV SHU YROXPH RI PHGLXP VKRXOG EH NHSW UHODWLYHO\ FRQVWDQW E\ JUDGXDOO\ UHGXFLQJ WKH
QXPEHURIVSKHURLGVSHUIODVN)RUPDQ\WXPRXUFHOO W\SHV WKH RSWLPXP FHOO QXPEHU GRHV
QRWH[WHQGEH\RQG[ FHOOVSHUPORIPHGLXPDQGWZRWKLUGVRIWKHPHGLXPKDVWREH
UHIUHVKHGHYHU\KRXUV

7KHPRVWFRQYHQLHQWPHWKRGRIJURZLQJVSLQQHUIODVNFXOWXUHVLVLQDKXPLGLILHG&
LQFXEDWRU DW  ƒ& LI D VWLUULQJ GHYLFH VXLWHG IRU LQFXEDWRU DWPRVSKHUHV LV DYDLODEOH
$OWHUQDWLYHO\ VSLQQHU IODVNV PD\ EH VHDOHG DQG NHSW LQ D QRQKXPLGLILHG WHPSHUDWXUH
FRQWUROOHG DWPRVSKHUH RU LQ D WKHUPRVWDWLFDOO\ FRQWUROOHG ZDWHUEDWK SRVLWLRQHG RYHU D
PDJQHWLFVWLUUHU,IWKHYROXPHVRIWKHJDVSKDVHDQGRIWKHFXOWXUHPHGLXPDUHDSSUR[LPDWHO\
WKH VDPH WKH PHGLXP RI WKH VHDOHG FXOWXUHV PD\ EH UHIUHVKHG HYHU\  KRXUV ZLWKRXW
JHQHUDWLQJ XQIDYRXUDEOH HQYLURQPHQWDO FRQGLWLRQV GXH WR FHOOXODU SURGXFWLRQ RI & DQG
PHWDEROLF ZDVWH 7KH VL]H RI FRPPHUFLDOO\ DYDLODEOH VSLQQHU IODVNV IRU UHVHDUFK SXUSRVHV
UDQJHVIURPPOWROLWUHZLWKDUHFRPPHQGHGPD[LPXPILOOLQJOHYHORIDSSUR[LPDWHO\
RIWKHWRWDOYROXPH7KHFKRLFHRIVL]HVKRXOGEHGHWHUPLQHGE\WKHQXPEHURIVSKHURLGV
QHHGHGRUWKH PLQLPXP YROXPHRIVXSSOHPHQWHGPHGLXPWREHDSSOLHG'LIIHUHQWW\SHVRI
VSLQQHU IODVNV DUH DYDLODEOH IURP YDULRXV FRPSDQLHV :KLOH WKH KDQGOLQJ RI WKHVH VSLQQHU
IODVNVLQSDUWLFXODUWKHHIIRUWUHTXLUHGIRUFOHDQLQJPD\GLIIHUWKHDXWKRUVKDYHH[SHULHQFHG
QR UHOHYDQW GLIIHUHQFH EHWZHHQ WKHP LQ WKH JURZWK NLQHWLFV RI 0&76 $Q DGGLWLRQDO
SDUDPHWHUWKDW VKRXOGEHRSWLPL]HGLVWKHVWLUULQJ IUHTXHQF\ DQG WKXV WKHVKHDUIRUFHLQ WKH
VSLQQHU FXOWXUH 2SWLPL]DWLRQ VKRXOG PLQLPL]H WKH QXPEHU RI FHOOV WKDW DUH VKHG IURP WKH
VSKHURLGV LQWR WKH PHGLXP 6RPH FHOO W\SHV H[KLELW DQ LQWULQVLFDOO\ KLJK FHOO VKHGGLQJ LQ
VSKHURLGFXOWXUHWKDWPD\QRWEHGHFUHDVHGE\WKHJURZWKFRQGLWLRQV$VDUHVXOWVKHGVLQJOH
FHOOVPD\IRUPVPDOOFOXVWHUVDQGRUDGKHUHWRWKHYHVVHOZDOO,QJHQHUDOWKHVHFRPSOLFDWLRQV
FDQEHDOOHYLDWHGLIQRWHOLPLQDWHGE\FKDQJLQJWKHFXOWXUHPHGLXPPRUHIUHTXHQWO\DQGE\
VLOLFRQL]DWLRQRIWKHLQQHUVXUIDFHVRIWKHVSLQQHUIODVNV6RPHFHOOW\SHVGRQRWIRUPLGHDOO\
VSKHULFDOVSKHURLGV,QGHHGVRPHUXPRXUFHOOVGRQRWHYHQH[KLELWFHOODJJUHJDWLRQVXFKDV
VRPH YDULDQWV RI WKH0&) EUHDVWFDQFHUFHOO OLQH ,I QR RU RQO\ LUUHJXODU FHOO FOXVWHUV DUH
REWDLQHG D QXPEHU RI SDUDPHWHUV FDQ EH PRGLILHG WR DFKLHYH VDWLVIDFWRU\ FHOOFHOO
DJJUHJDWLRQDQGDJJUHJDWHJURZWKLQFOXGLQJ

D ,QLWLDWLRQRIDJJUHJDWHIRUPDWLRQ
x VHUXPW\SH EDWFK 
x VHUXPFRQWHQW
x FXOWXUHPHGLXP JOXFRVHDQGJOXWDPLQHFRQFHQWUDWLRQV 
x QRQDGKHVLYHGLVK PLFURELRORJLFDODJDUFRDWHG 
x &2LQLQFXEDWRU S+LQFXOWXUHPHGLXP 

ϭϭϵ

 x FHOOFRQFHQWUDWLRQ

E ,QLWLDOSKDVHRIVSLQQHUIODVNFXOWXULQJ
xVDPHIDFWRUVDVLQ D HDFKIDFWRUPD\EHGLIIHUHQWIURPWKRVHLQ D 
xVWLUULQJIUHTXHQF\
xVSLQQHUIODVNJHRPHWU\


)LJXUH  0HWKRGV IRU WKH FXOWLYDWLRQ RI PXOWLFHOOXODU VSKHURLGV XQGHU FRQWLQXRXV
VWLUULQJ VSLQQHU IODVK UROOHU WXEH J\UDWRU\ VKDNHU HWF  RU VWDWLF RQ QRQDGKHUHQW VXUIDFHV
OLTXLGRYHUOD\LQZHOOSODWHV 

6SLQQHUFXOWXUHLVSUHIHUDEOHWRJURZWKRI0&76RQVWDWLRQDU\QRQDGKHVLYHVXUIDFHV
LI ODUJH QXPEHUV RI VSKHURLGV ZLWK D PD[LPXP VL]H DUH QHHGHG 6SKHURLGV FRQWLQXRXVO\
JURZQRQDJDUDJDURVHFRDWHGVXUIDFHVPD\QRWUHDFKWKHLUPD[LPXPVL]HDQGWKHWKLFNQHVV
RIWKHYLDEOHFHOOULPLVRIWHQUHODWLYHO\VPDOO&RQYHUVHO\YDULRXVPRGLILFDWLRQVIRUFXOWXULQJ
VSKHURLGVLQVRFDOOHGDJDURUOLTXLGRYHUOD\ ILJXUH KDYHEHHQHVWDEOLVKHG7KHDSSOLFDWLRQ
RI ZHOO SODWHV LV RI SDUWLFXODU LQWHUHVW EHFDXVH LQGLYLGXDO VSKHURLGV FDQ EH PRQLWRUHG
UHSHDWHGO\DQGPD\EHPDQLSXODWHGWKURXJKRXWJURZWK)ROORZLQJDQLQLWLDWLRQSHULRGXQGHU
VWDWLF FRQGLWLRQV OLTXLGRYHUOD\ FXOWXUHV PD\ EH NHSW RQ D J\UDWRU\ VKDNHU WR JXDUDQWHH
RSWLPXP QXWULHQW VXSSO\ $V D SUHUHTXLVLWH ZHOO SODWHV DUH FRDWHG ZLWK 
DJDUDJDURVH$QRYHOVHPLDGKHVLYHVXEVWUDWHXVHGIRUVSKHURLGFXOWLYDWLRQWDNHVDGYDQWDJH
RIWKHVSRQWDQHRXVGHWDFKPHQWRIVPDOOFHOODJJUHJDWHVIRUPHGRQVHPLDGKHVLYHVXEVWUDWHV
VXFKDVSURWHRJO\FDQVRUSRVLWLYHO\FKDUJHGSRO\VW\UHQH

$GGLWLRQDOPHWKRGRORJLFDODVSHFWV

,Q DGGLWLRQ WR WKH YROXPH RI WKH VSKHURLGV ZKLFK VKRXOG EH PRQLWRUHG URXWLQHO\
DQDO\VLV RI WKH SUROLIHUDWLYH DFWLYLW\ LV XVHIXO 7KH SUROLIHUDWLRQ VWDWXV FDQ EH GHWHUPLQHG
DXWRUDGLRJUDSKLFDOO\ E\ >+@ WK\PLGLQH ODEHOOLQJ 7/,  WK\PLGLQH ODEHOOLQJ LQGH[  RU
LPPXQRKLVWRORJLFDOO\ XWLOL]LQJ WKH %UG8UG DQWLERG\ WHFKQLTXH RU DQWLERGLHV GHWHFWLQJ
VSHFLILF SUROLIHUDWLRQDVVRFLDWHG DQWLJHQV VXFK DV 3&1$ RU .L $OWHUQDWLYHO\ VSKHURLGV
PD\ EH GLVVRFLDWHG HQ]\PDWLFDOO\ DQG IL[HG RU XQIL[HG VLQJOH FHOO VXVSHQVLRQV FDQ EH
DQDO\VHG IRU WKHLU FHOO F\FOH GLVWULEXWLRQ XVLQJ IORZ F\WRPHWU\ DQG '1$VSHFLILF

ϭϮϬ

IOXRURFKURPHVVXFKDVSURSLGLXPLRGLGH$$' DPLQRDFWLQRUQ\FLQ' PLWKUDP\FLQRU
+RHFKVW'1$G\HV6HFWLRQVRIIUR]HQRUIL[HGSDUDIILQHPEHGGHGVSKHURLGVFDQEHVWDLQHG
E\ DQ\ FRQYHQWLRQDO ODEHOOLQJ WHFKQLTXH RU H[DPLQHG E\ VFDQQLQJRU WUDQVPLVVLRQHOHFWURQ
PLFURVFRS\

$ PHWKRG IRU LVRODWLQJ VSHFLILF FHOO VXESRSXODWLRQV IURP VSKHURLGV LV GHVFULEHG LQ
GHWDLO7KLVDXWRPDWHGGLVVRFLDWLRQWHFKQLTXHLVEDVHGRQWKHVHTXHQWLDOH[SRVXUHRIWKHFHOO
DJJUHJDWHVWRDQHQ]\PHVROXWLRQ7KHH[SHULPHQWDOVHWXSFRQVLVWVRIDXWRFODYDEOHVWDQGDUG
ODERUDWRU\ HTXLSPHQW PRXQWHG RQ D J\UDWRU\ SODWIRUP LQ D R& ZDWHUEDWK DV VKRZQ LQ
)LJXUH 7KHHQ]\PHVROXWLRQ LV FRQWLQXRXVO\ SXPSHGWKURXJKDWHPSHUDWXUHHTXLOLEUDWLRQ
FRLO LQWR D UDFHWUDFN  GLVVRFLDWLRQ FKDPEHU ZKLFK LV ILOOHG ZLWK  PO RI HQ]\PH VROXWLRQ
EHIRUH WKH GLVVRFLDWLRQ SURFHGXUH 7KH FKDPEHU FRQVLVWV RI WZR FRPSDUWPHQWV ZKLFK DUH
VHSDUDWHG E\ D Q\ORQ VFUHHQ ZLWK D SRUH VL]H RI  XP 3XPSLQJ HQ]\PH VROXWLRQ LQWR WKH
RXWHU FRPSDUWPHQW DQG RXW RI WKH LQQHU SDUW JHQHUDWHV D IORZ RI OLTXLG WKURXJK WKH VFUHHQ
7KXVWKHVSKHURLGVDUHNHSWLQVXVSHQVLRQLQWKHRXWHUFRPSDUWPHQWZKLOHGLVVRFLDWHGVLQJOH
FHOOVUHDFKWKHLQQHUFRPSDUWPHQWIROORZLQJWKHIOXLGIORZ7KHFHOOVXVSHQVLRQLVFRQVWDQWO\
UHPRYHGIURP WKHLQQHUFRPSDUWPHQWDQGFROOHFWHG RQ LFH6HTXHQWLDODOLTXRWVDUHVDPSOHG
IURPGLIIHUHQWOHYHOVZLWKLQWKHVSKHURLGV



)LJXUH  ([SHULPHQWDO VHWXS IRU DXWRPDWHG VHOHFWLYH GLVVRFLDWLRQ RI PXOWLFHOOXODU
VSKHURLGVFRQVLVWLQJRIDQHQ]\PHFRFNWDLOUHVHUYRLUDQGVXSSO\XQLWDSHULVWDOWLFSXPSIRU
HQ]\PH WUDQVSRUW WKURXJK D WHPSHUDWXUH HTXLOLEUDWLRQ FRLO LQWR D VSHFLDOO\ GHVLJQHG
GLVVRFLDWLRQFKDPEHUERWKSODFHGLQDƒ&WHPSHUDWXUHFRQWUROOHGVKDNLQJZDWHUEDWK7KH
GLVVRFLDWLRQFKDPEHUFRQWDLQVDQRXWHUDQGDQLQQHUFKDPEHUZKLFKLVVHSDUDWHGE\D—P
PHVKDQGLVVHDOHGE\DVWRSSHU6SKHURLGVDUHSODFHGLQWKHRXWHUFKDPEHUDQGWKHHQ]\PH
FRFNWDLO LVSXPSHGWKURXJKWKHFKDPEHUVRWKDWGLVVRFLDWHGFHOOVDUHWUDQVIHUUHG LQWRD WXEH
FRQWDLQLQJLFHFROGPHGLXP






ϭϮϭ

0&76FRFXOWXUHV
*HQHUDODVSHFWVRIWXPRXUKHWHURJHQHLW\

7KH SUHVHQFH RI KLVWRORJLFDOO\ GLIIHUHQW FHOO W\SHV ZLWKLQ WXPRXUV LQFOXGLQJ KRVW
GHIHQFH FHOOV ILEUREODVWV DQG HQGRWKHOLXP FRQWULEXWHV WR WKHLU KHWHURJHQHLW\ 7KLV
KHWHURJHQHLW\FDQWRVRPHH[WHQWEHPLPLFNHGLQYLWURE\KHWHURORJRXVVSKHURLGVFRQVLVWLQJ
RI UXPRXU FHOOV DQG KRVW FHOOV 6XFK VSKHURLGV PD\ EH LQLWLDWHG GLUHFWO\ IURP PL[WXUHV RI
VXVSHQGHGKRVWFHOOVVXFKDVILEUREODVWVRUPRQRF\WHVDQG7XPRXUFHOOV2QHGLVDGYDQWDJH
RIWKLVDSSURDFKLVWKHULVNRIQRQUHSURGXFLEOHIRUPDWLRQRILQWUDVSKHURLGDOFOXVWHUVRI RQH
FHOO W\SH $OWHUQDWLYHO\ SUHIRUPHG 0&76 RI GHILQHG VL]HV DQG KLVWRPRUSKRORJLFDO
FKDUDFWHULVWLFVFDQEHLQFXEDWHGZLWKVXVSHQVLRQVRILPPXQHFHOOVVXFKDVPRQRF\WHVRU/$.
O\PSKRNLQHDFWLYDWHGNLOOHU FHOOVWRVWXG\LPPXQHFHOOLQILOWUDWLRQDQGLWVF\WRVWDWLFDQGRU
F\WRWR[LFHIIHFWVRQWKHWXPRXUFHOOV

&RFXOWXUHVRI0&76DQGLPPXQHFHOOV

0RQRQXFOHDU FHOOV IURP SHULSKHUDO EORRG FDQ EH SUHSDUHG E\ VWDQGDUG GHQVLW\
FHQWULIXJDWLRQRYHU)LFROO+\SDTXHDQGKXPDQEORRGPRQRF\WHVFDQEHVHSDUDWHGIURPWKLV
FHOO PL[WXUH E\ WKHLU LQWULQVLF DFWLYLW\ WR DGKHUH WR SODVWLF RU JODVV VXUIDFHV $ PRUH
FRQYHQLHQW WHFKQLTXH XVHV OHXNDSKRUHVLV DQG FRXQWHUFXUUHQW HOXWULDWLRQ 'LIIHUHQWLDWHG
PDFURSKDJHVFDQEHJHQHUDWHGE\ORQJWHUPFXOWXUHLQ7HIORQEDJVDQGWKHVHFDQEHXVHGIRU
FRFXOWLYDWLRQH[SHULPHQWV

&RFXOWXUHVRI0&76DQGIOEUREODVWDJJUHJDWHV

7KHH[WUDFHOOXODUPDWUL[ (&0 PDLQO\SURGXFHGE\VWURPDOILEUREODVWVKDVDFUXFLDO
UROHLQHSLWKHOLDOFHOOGLIIHUHQWLDWLRQJURZWKDQGJHQHH[SUHVVLRQ7RLQYHVWLJDWHLQWHUDFWLRQV
EHWZHHQVWURPDOILEUREODVWVDQGWXPRXUFHOOV0&76FDQEHFXOWXUHGRQFRQIOXHQWILEUREODVW
PRQROD\HUVRUZLWKILEUREODVWDJJUHJDWHVDVGHVFULEHGZLWKKXPDQEODGGHUDQGEUHDVWFDQFHU
FHOOV :KLOH VRPH WXPRXU FHOO W\SHV RYHUJURZ ILEUREODVW DJJUHJDWHV DQG PD\ VKRZ VRPH
VSHFLILF FHOOFHOO LQWHUDFWLRQV LQ WKH FRQWDFW ]RQH RWKHUV LQ SDUWLFXODU KLJKO\ PHWDVWDWLF
WXPRXUFHOOVVHHPWRLQYDGHWKHILEUREODVWDJJUHJDWHV

&RFXOWXUHVRI0&76DQGHQGRWKHOLDOFHOOV

0&76 DUH DOVR XVHG LQ VWXGLHV RI DQJLRJHQHVLV DQG LQYDVLRQ VXFK DV WKH HPEU\RQLF
FKLFNKHDUWIUDJPHQWFRQIURQWDWLRQFXOWXUHV\VWHPLQ VHPLVROLGPHGLXP &XOWXUH RI 0&76
RQ FRQIOXHQW HQGRWKHOLDO FHOOV ZLWK XQGHUO\LQJ (&0 FDQ EH XVHG WR VWXG\ WXPRXU FHOO
LQYDVLRQEXWQRWDQJLRJHQHVLV'DWDREWDLQHGZLWKPHODQRPDFHOOVSKHURLGVKDYHOHGWRWKH
K\SRWKHVLVWKDWIUHHUDGLFDOPHGLDWHGHQGRWKHOLDOFHOOGDPDJHLVRQHPHFKDQLVPFRQWULEXWLQJ
WRPHODQRPDPHWDVWDVLV

$GGLWLRQDOWHFKQLFDODVSHFWV

6HSDUDWLRQ RI FHOOV IURP GHILQHG ORFDWLRQV ZLWKLQ VHFWLRQV IURP ' FXOWXUHV FDQ EH
DFKLHYHG XVLQJ PLFURGLVVHFWLRQ WHFKQLTXHV VXFK DV ODVHU PLFUREHDP FRPELQHG ZLWK DQ
RSWLFDO WZHH]HU 'LVVRFLDWLRQ RI FRFXOWXUHV E\ HQ]\PDWLF RU PHFKDQLFDO PHDQV DOORZV IRU
IORZ F\WRPHWULF DQDO\VHV DQG IRU VHSDUDWLRQ RI FHOOXODU VXESRSXODWLRQV E\ YDULRXV VRUWLQJ
WHFKQLTXHV $V D SUHUHTXLVLWH IRU FHOO GHWHFWLRQ DQG VHSDUDWLRQ FHOO VXESRSXODWLRQV FDQ EH
SHUPDQHQWO\ ODEHOOHG E\ WKH LQWURGXFWLRQ RI VSHFLILF PDUNHU JHQHV IRU H[DPSOH XVLQJ S

ϭϮϮ

JDODFWRVLGDVH RU JUHHQ IOXRUHVFHQW SURWHLQ *)3  RU ODEHOVIRUFHOO PHPEUDQHV *)3 FDQ EH
GHWHFWHGLQURXWLQHIORZF\WRPHWU\

([SHULPHQWDOWLVVXHPRGHOOLQJ
&XUUHQWUHVHDUFKRQWLVVXHPRGHOOLQJ

6XEVWDQWLDO SURJUHVV KDV EHHQ PDGH WRZDUGV WKH GHYHORSPHQW RI DQ DUWLILFLDO OLYHU
6WUDWHJLHV LQFOXGH FXOWXUH RI KHSDWRF\WH VSKHURLGV RU RI KHWHURVSKHURLGV FRQVLVWLQJ RI
KHSDWRF\WHV DQG ILEUREODVWV RU SDUHQFK\PDO FHOOV 7KH DSSOLFDWLRQ RI DUWLILFLDO VXSSRUW
V\VWHPV VXFK DV SRURXV JHODWLQ VSRQJHV DJDURVH RU FROODJHQ DV ZHOO DV WKH LQGXFWLRQ RI
DJJUHJDWLRQE\H[RJHQRXVDGKHVLRQPROHFXOHVLVDGYDQWDJHRXVIRUORQJWHUPFXOWXUHRIOLYHU
FHOOV 5HFRQVWLWXWLRQ RI WKH VSHFLILF JHRPHWU\ PLFURHQYLURQPHQW DQG PHWDEROLVP RI WKH
KHSDWLFVLQXVRLGLQDFRPSOH['FXOWXUHV\VWHPKDVEHHQUHSRUWHGDQGSLJKHSDWRF\WHVKDYH
EHHQJURZQLQFRFXOWXUHLQDQDUWLILFLDO'FDSLOODU\V\VWHP

'HYHORSPHQWRIDQDUWLILFLDOSDQFUHDVKDVIRFXVHGRQVSKHURLGVIURPLQVXOLQVHFUHWLQJ
UHFRPELQDQWPRXVHSLWXLWDU\$W7FHOOVDQGPRXVHLQVXOLQRPDEHWD7&FHOOV/RQJWHUP
YLDELOLW\ DQG IXQFWLRQ RI KXPDQ IHWDO LVOHWOLNH FHOO FOXVWHUV LPSODQWHG XQGHU WKH NLGQH\
FDSVXOH RI DWK\PLF PLFH KDYH EHHQ DFKLHYHG $QRWKHU SURPLVLQJ VWUDWHJ\ LV WKH XVH RI
LVRODWHG SLVFLQH LVOHWV VR FDOOHG %URFNPDQQ ERGLHV DV QDWXUDO  SDQFUHDWLF VSKHURLGV ZKLFK
FDQEHLPSODQWHGDV[HQRJUDIWVDIWHUPLFURHQFDSVXODWLRQZLWKDOJLQDWH2[\JHQVXSSO\VHHPV
WRSOD\DFUXFLDOUROHIRUWKHVXUYLYDODQGPDLQWHQDQFHRIIXQFWLRQRIVXFKLVOHWV

7KHSLWXLWDU\JODQGKDVEHHQPRGHOOHGXVLQJPXOWLFHOOXODUVSKHURLGVWRVWXG\KRUPRQH
UHOHDVH LQFOXGLQJ OXWHLQLVLQJ KRUPRQH /+  IROORZLQJ VWLPXODWLRQ ZLWK WKH UHOHDVLQJ
KRUPRQH /+5+ ,Q FRQWUDVW WR SLQHDO FHOO PRQROD\HUV ' FXOWXUHV UHPDLQ IXQFWLRQDO IRU
PRUHWKDQWKUHHZHHNVVHFUHWLQJPHODWRQLQZKHQFKDOOHQJHGZLWKLVRSURWHUHQRO'HVSLWHWKHLU
WHQGHQF\ WR VSRQWDQHRXVO\ IRUP IROOLFOHV LQ DJJUHJDWLRQ FXOWXUH WKHUH DUH IHZ UHSRUWV RQ
LVRODWHGDGXOWWK\URLGFHOOV7K\URLGFHOOVSKHURLGVDOORZVWXG\RIFHOOPRWLOLW\FHOODGKHVLRQ
DQG(FDGKHULQH[SUHVVLRQLQWK\URLGIROOLFOHELRJHQHVLV'EUDLQFXOWXUHVKDVEHHQUHYLHZHG
FRPSUHKHQVLYHO\ DQG KDYH EHHQ XVHG WR VWXG\ QHXUDO P\HOLQDWLRQ DQG GHP\HOLQDWLRQ
QHXURQDO GHJHQHUDWLRQ DQG WKH QHXURWR[LFLW\ RI OHDG 1HXURQDO EHKDYLRXU IROORZLQJ +,9
LQIHFWLRQ $O]KHLPHU V GLVHDVH DQG 0RUEXV 3DUNLQVRQ KDV EHHQ VWXGLHG XVLQJ DJJUHJDWHG
EUDLQFHOOFXOWXUHV5HWLQDOGHYHORSPHQWKDVDOVREHHQPRGHOOHG'FKRQGURF\WHUHVHDUFKKDV
IRFXVHGRQPROHFXODUDVSHFWVRIPDWUL[IRUPDWLRQDQGGLIIHUHQWLDWLRQ

$JJUHJDWHG FHOO FXOWXUHV RI KHDUW FHOOV KDYH EHHQ XVHG WR VWXG\ DVSHFWV RI FDUGLDF
GHYHORSPHQW DQG SK\VLRORJ\ LQFOXGLQJ VLQRDWULDO QRGH FHOO SUHSDUDWLRQV DWULDO FHOO
SUHSDUDWLRQV HPEU\RQLF FKLFN KHDUW FHOO DJJUHJDWHV DQG YHQWULFXODU FHOO DJJUHJDWHV 2WKHU
WLVVXHVWKDWKDYH EHHQ PRGHOOHGLQ ' FXOWXUHV LQFOXGHPHVDQJLDOFHOOVXURWKHOLDO FHOOVDQG
QDVRSKDU\QJHDOFHOOV

7LVVXHPRGHOOLQJRIVNLQDQGPXFRVD

+HWHURW\SLF ' FXOWXUHV LQFOXGLQJ ILEUREODVWV DQG NHUDWLQRF\WHV KDYH EHHQ XVHG IRU
VWXGLHV RQWKH IRUPDWLRQ RI VNLQ DQG KDLUIROOLFOHV DQGWKHLQIOXHQFHRIPHVHQFK\PHRQWKH
GLIIHUHQWLDWLRQRINHUDWLQRF\WHV




ϭϮϯ

(PEU\RLGERGLHV

(PEU\RLGERGLHV (% DUHGHULYHGIURPHPEU\RQLFVWHPFHOO (6 FHOOOLQHVZKLFKKDYH
UHWDLQHG WKHLU FDSDFLW\ WR JHQHUDWH FHOOV RI WKH KDHPDWRSRLHWLF HQGRWKHOLDO PXVFOH DQG
QHXURQDOOLQHDJHV'HYHORSPHQWRIVNHOHWDOPXVFOHP\RF\WHVLQHPEU\RLGERGLHVLVVLPLODUWR
WKDW LQ YLYR DQG EHDWLQJ (% ZLWK FDUGLHVSHFLILF UHFHSWRUV LRQLF FKDQQHOV DQG DFWLRQ
SRWHQWLDOV KDYH EHHQ SURGXFHG 2[\JHQUHJXODWHG JHQH H[SUHVVLRQ GXULQJ HPEU\RQLF
GHYHORSPHQWKDVDOVREHHQVWXGLHG

5HIHUHQFHV

$FNHU+DQG&DUOVVRQ-  ,Q6SKHURLGFXOWXUHLQFDQFHUUHVHDUFK HG5%MHUNYLJ S
&5&3UHVV%RFD5DWRQ
$FNHU+&DUOVVRQ-+ROWHUPDQQ*1HGHUPDQ7DQG1\OHQ 7   &DQFHU 5HV

$FNHU+&DUOVVRQ-0XHOOHU.OLHVHU:DQG6XWKHUODQG50  %U-&DQFHU

$FNHU+3LHWUXVFKND)DQG'HXWVFKHU-  %U-&DQFHU
$QGUHHVHQ 5 *DGG 6 %UXJJHU : /RKU * : DQG $WNLQV 5 &  
,PPXQRELRORJ\
$\R6+DQG.UHLVEHUJ-,  -$P6RF1HSKURO
%DGHU$.QRS(.HUQ$%RHNHU.)UDHKDXI1&URPH2HWDO  ([S&HOO
5HV
%HDWWLH*0%XWOHU&DQG+D\HN$  &HOO7UDQVSODQW
%HFNHU,%HFNHU.)5RKUO0+0LQNXV*6FKXHW]H.DQG+RIOHU+  /DE
,QYHVW
%MHUNYLJ5/XQG-RKDQVHQ0DQG(GYDUGVHQ.  &XUU2SLQ2QFRO
%R[EHUJHU+-6HVVOHU0-0DHW]HO%DQG0H\HU7)  (XU@&HOO%LRO

%R[EHUJHU+-6HVVOHU0-0DHW]HO%0RVOHK,0%HFNHU+'DQG0H\HU7)
 (SLWKHOLDO&HOO%LRO
%R\HWW 0 5 .RGDPD , +RQMR + $UDL $ 6X]XNL 5 DQG 7R\DPD -  
&DUGLDYDVF5HV
%UDFNH 0 5RPLMQ + 9DNDHW / 9\QFNH % 'H 0HWV 0 DQG 0DUHHO 0   ,Q
6SKHURLGFXOWXUHLQFDQFHUUHVHDUFK HG5%MHUNYLJ S&5&3UHVV%RFD5DWRQ
%UDGOH\&DQG3LWWV-  %U-&DQFHU
%URXW\%R\H ' 0DLQJXHQH & 0DJQLHQ 9 ,VUDHO / DQG %HDXSDLQ 5   ,QW -
&DQFHU
%\HUV 6: 6RPPHUV &/+R[WHU%0HUFXULR$0DQG7R]HUHQ $   - &HOO
6UL
&DUOVVRQ -   ,Q 6SKHURLG FXOWXUH LQ FDQFHU UHVHDUFK HG 5 %MHUNYLJ  S  &5&
3UHVV%RFD5DWRQ
&DUOVVRQ-DQG$FNHU+  ,QW-&DQFHU
&DUOVVRQ - DQG 1HGHUPDQ 7   ,Q 6SKHURLG FXOWXUH LQ FDQFHU UHVHDUFK HG 5
%MHUNYLJ S&5&3UHVV%RFD5DWRQ
&KDWWHUMHH66DQG1ROGQHU0  -1HXUDO7UDQVP6XSSO
&OD\-5.ULVWRI$66KHQDVD-%URFKX50DQG6KULHU$  3URJ%LRSK\V
0RO%LRO
&XELWW$%+HLP5$GDPV65%R\G$(*URVV/$DQG7VLHQ5<  
7UHQGV%LRFKHP6FL

ϭϮϰ

'DL:*DQG6DOW]PDQ:0  %LRWHFKQRO%LRHQJ
'HQNHU$(1LFROO6%DQG7XDQ56  'LIIHUHQWLDWLRQ
'HVRL]H%*LPRQHW'DQG-DUGLOOHU-&  $QWLFDQFHU5HV
'RHWVFKPDQ76KXOO0.LHU$DQG&RIILQ-'  +\SHUWHQVLRQ
'R]LQ%4XDUWR5&DPSDQLOH*DQG&DQFHGGD5  (XU-&HX%LRO
(QGRK . 8HQR . 0L\DVKLWD $ DQG 6DWRK 7   5HV &RPPXQ &KHP 3DWKRO
3KDUPDFRO
(QJHEUDDWHQ2  ,Q6SKHURLGFXOWXUHLQFDQFHUUHVHDUFK HG5%MHUNYLJ S&5&
3UHVV%RFD5DWRQ
)RONPDQ-  -1DWO&DQFHU,QVW
)RONPDQ-  6HPLQ&DQFHU%LRO
)RONPDQ-  ([SHULHQWLD6XSSOHPHQW
)UH\HU - 3   ,Q6SKHURLG FXOWXUH LQFDQFHU UHVHDUFK HG 5%MHUNYLJ  S  &5&
3UHVV%RFD5DWRQ
)UH\HU-3DQG6FKRU3/  ,Q9LWUR&HOO'HY%LRO
)XMLZDUD7*ULPP($0XNKRSDGK\D\7&DL':2ZHQ6FKDXE/%DQG
)XMLZDUD 7 *ULPP ( $ 0XNKRSDGK\D\ 7 =KDQJ : : 2ZHQ6FKDXE / % DQG
5RWK-$  &DQFHU5HV
*DVVPDQQ0)DQGUH\-%LFKHW6:DUWHQEHUJ00DUWL++%DXHU&HWDO  
3URF1RWO$FDG6FL86$
*HELFNH+DHUWHU3-$SSHO.+RQHJJHU3DQG%HUJHU0  -1HXURVFL5HV

*HUODFK-&  $GY([S0HG%LRO
*HUODFK - & 6FKQR\ 1 (QFNH - 6PLWK 0 ' 0XOOHU & DQG 1HXKDXV 3  
+HSDWRORJ\
*RVSRGDURZLF]'9ORGDZVN\-DQG6DYLRQ1  -6XSUDPRO6WUXFW
*URHEH.DQG0XHOOHU.OLHVHU:  ,QW-5DGLDW2QFRO%LRO3K\V
+DXSWPDQQ6'HQNHUW&/RKUNH+7LHW]H/2WW6.ORVWHUKDOIHQ%HW DO  
,QW-&DQFHU
+H&-6WULNHU/-7VRNRV0<DQJ&:3HWHQ(3DQG6WULNHU*(  $P
-3K\VLRO &HOO3K\VLRO   &
+HLP5DQG7VLHQ5<  &XUU%LRO
+H\ZDUG6$'XERLV6WULQJIHOORZ15DSRSRUW5DQG%DXWFK9/  )$6(%

+ROH1*UDKDP*-0HQ]HO8DQG$QVHOO-'  %ORRG
+ROWIUHWHU-$  ([S=RRO
+XHOVHU')  ,Q6SKHURLGFXOWXUHLQFDQFHUUHVHDUFK HG5%MHUNYLJ S&5&
3UHVV%RFD5DWRQ
,KDUD6:DWDQDEH01DJDR(DQG6KLR\D1  &HOO7LVVXH5HV
,QFK:50F&UHGLH-$DQG6XWKHUODQG50  *URZWK
-DDVNHODLQHQ-.DOOLRPDNL33DHWDX$DQG7LPRQHQ7  -,PPXQR/
-DDVNHODLQHQ-/HKWRQHQ(+HLNNLOD3.DOOLRPDNL3DQG7LPRQHQ7  -1DWO
&DQFHU,QVW
-DIIH ($ 1DFKPDQ5/%HFNHU&*DQG0LQLFN * 5  - &OLQ ,QYHVW 

.HOHUR GH 5RVER 1 +RQHJJHU 3 /DVVPDQQ + DQG 0DWWKLHX - 0   -
1HXURFKHP
.HOOHU*0  &XUU2SLQ&HX%LRO
.KDQ1$6KDFRRUL9+DYRXLV54XHUQH'0RXOLQRX[-3DQG5DXOW%  -
1HXURHQGRFULQRO

ϭϮϱ

.QXHFKHO5DQG6XWKHUODQG50  &DQFHU-
.QXHFKHO 5 DQG 6XWKHUODQG 5 0   ,Q 6SKHURLG FXOWXUH LQ FDQFHU UHVHDUFK HG 5
%MHUNYLJ S&5&3UHVV%RFD5DWRQ
.QXHFKHO5.HQJ3+RIVWDHGWHU)/DQJPXLU96XWKHUODQG50DQG3HQQH\'3
 $P-3DWKRO
.QXHFKHO 5 6LHEHUW:HOOQKRIHU $ 7UDXE  DQG 'HUPLHW]HO 5   $P-3DWKRO

.RLGH 1 6DNDJXFKL . .RLGH < $VDQR . .DZDJXFKL 0 0DWVXVKLPD + HW DO
 ([S&HOO5HV
.ROVRQ ' / %XFKKDOWHU - &ROOPDQ 5 +HOOPLJ % )DUUHOO & ) 'HERXFN & HW DO
 $,'65HV+XP5HWURYLUXVHV
.RQXU$.UHXW]0.QXHFKHO5.UDXVH6:DQG$QGUHHVHQ5  ,QW-&DQFHU

.UDK.0LURQRY95LVDX:DQG)ODPPH,  'HY%LRO
.UDXVH6:5HKOL0DQG$QGUHHVHQ5  ,PPXQRO5HY
.XQ]6FKXJKDUW/$DQG)UH\HU-3  ,Q9LWUR&HOO'HY%LRO
.XQ]6FKXJKDUW/$*URHEH.DQG0XHOOHU.OLHVHU:  ,QW@&DQFHU
.XQ]6FKXJKDUW / $ +DEEHUVHWW 5 & DQG )UH\HU - 3   $P - 3K\VLRO 
&
.XQ]6FKXJKDUW/$.UHXW]0DQG.QXHFKHO5  ,QW-([S3DWKRO
/DGHURXWH.50XUSK\%-6KRUW60*UDQW7'.QDSS$0DQG
/DLUG$.  %U-&DQFHU
/DLUG$.  %U-&DQFHU
/D5XH.(%UDGEXU\(0DQG)UH\HU-3  &DQFHU5HV
/L$3&ROEXUQ60DQG%HFN'-  ,Q9LWUR&HOO'HY%LRO$
/L*5)HQJ-6KULHU$DQG1DWWHO6  -3K\VLRO /RQG 
/LPDW$%UHLWNUHXW]'+XQ]LNHU7.OHLQ&(1RVHU))XVHQLJ1(HWDO  
&HOO7LVVXH5HV
/LPDW$%UHLWNUHXW]'6WDUN+-+XQ]LNHU77KLNRHWWHU*1RVHU)HWDO  
$QQ1<$FDG6FL
/LPDW $ +XQ]LNHU 7 %UHLWNUHXW] ' )XVHQLJ 1 ( DQG %UDDWKHQ / 5   6NLQ
3KDUPDFRO
/LQ.+0DHGD6DQG6DLWR7  %LRWHFKQRO$SSO%LRFKHP
/RXJKOLQ$-+RQHJJHU3:RRGURRIH01&RPWH90DWWKLHX-0DQG&X]QHU
0/  -1HXURVFL5HV
/\EDUJHU/'HPSVH\')UDQHN.-DQG&KHUYHQDN5  &\WRPHWU\
0DOOHLQ*HULQ)5XJJLHUR)4XLQQ70%DUG)*URG]LQVN\$-2OVHQ%5HWDO
 ([S&HOO5HV
0DQVEULGJH - 1 $XVVHUHU : $ .QDSS 0 $ DQG 6XWKHUODQG 5 0   - &HOO
3K\VLRO
0DQVEULGJH - 1 .QXFKHO 5 .QDSS $ 0 DQG 6XWKHUODQG 5 0   - &HOO
3K\VLRO
0DUHHO009DQ5R\)0DQG'H%DHWVHOLHU3  &DQFHU0HWDVWDVLV5HY
0DUWLQ*5  6FLHQFH
0DUXVLF0%DM]HU=DQG9XN3DYORYLF6  %XLO0DWK%LRO
0DWWKLHX-0&RPWH97RVLF0DQG+RQHJJHU3  -1HXURLPPXQRO

0RQ]%.DUEDFK8*URHEH.DQG0XHOOHU.OLHVHU:  2QFRO5HS
0RVFRQD$  ([S&HOO5HV
0RVFRQD$  ([S&HOO5HV

ϭϮϲ

0XHOOHU.OLHVHU:  -&DQFHU5HV&OLQ2QFRO
0XHOOHU.OLHVHU:  $P-3K\VLRO&
0XUSK\%-/DGHURXWH.59UHPDQ+-*UDQW7'*LOO166WHYHQVRQ'.HW
DO  &DQFHU5HV
1HHPDQ 0 $EUDPRYLWFK 5 6FKLIIHQEDXHU < 6 DQG 7HPSHO &   ,QW-
([S3DWKRO
1HHPDQ0$EUDPRYLWFK57HPSHO&0HLU*,WLQ$6KZHLNL'HWDO  3URF
6RF0DJQ5HVRQ0HG
1LVKLNDZD < 7RNXVDVKL < .DGRKDPD 7 1LVKLPRUL + DQG 2JDZD .   ([S
&HOO5HV
2IIQHU ) $ :LUW] + 6FKLHIHU 5 - %LJDONH / .ORVWHUKDOIHQ % %LWWLQJHU ) HW DO
 $P-3DWKRO
3DXOXV:+XHWWQHU&DQG7RQQ-&  ,QW-&DQFHU
3HVKZD 0 9:X) -)ROOVWDG %'&HUUD)% DQG +X : 6   %LRWHFKQRO
3URJ
3ROLDUG$1LIXML$/DPEOLQ'3OHH()RUHVW&DQG.HOOHUPDQQ2  -&HOO
%LRO
5DENLQ6:  *HQ3KDUPDFRO
5DN-0LWVXELVKL<(UGRV9+XDQJ61)LOPXV-DQG.HUEHO56  -&HOO
%LRO
5RKZHGHO-0DOWVHY9%REHU($UQROG+++HVFKHOHU-DQG:REXV$0  
'HY%LRO
5RPHUR)-=XNRZVNL'DQG0XHOOHU.OLHVHU:  $P-3K\VLR&
5RWK-$  &DQFHU5HV
6FKUH]HQPHLU - *HUR / /DXH & .LUFKJHVVQHU - 0XOOHU $ +XOV $ HW DO  
7UDQVSODQW3URF
6FKUH]HQPHLU-.LUFKJHVVQHU-*HUR/.XQ]/$%H\HU-DQG0XHOOHU.OLHVHU:
 7UDQVSODQWDWLRQ
6FKXHW]H.DQG&OHPHQW6HQJHZDOG$  1DWXUH
6FKXVWHU8%XWWQHU5+RIHWDHGWHU)DQG.QXHFKHO5  -8URO
6KDFRRUL 9 6DLDJ % *LUUH $ DQG 5DXOW %   5HV &RPPXQ 0RO
3DWKRO3KDUPDFRO
6KLUDKD + .RLGH 1 +DGD + 8MLNH . 1DNDPXUD 0 6KLQML 7 HW DO  
%LRWHFKQRO%LRHQJ
6WUXELQJ&$KQHUW+LOJHU*6KDQ-:LHGHQPDQQ%+-DQG:REXV$0  
0HFK'HY
6XWKHUODQG500F&UHGLH-$DQG,QFK:5  @1DWO&DQFHU,QVW
6XWKHUODQG50  6FLHQFH
6XWKHUODQG50  %U-&DQFHU
6XWKHUODQG50,QFK:50F&UHGLH-$DQG.UXXY-  ,QW-5DGLDO%LDO

7DNH]DZD70RUL<<RQDKD7DQG<RVKL]DWR.  ([S&HOO5HV
7DWVXNDZD < $ULWD 0 .L\RVXH 7 0LNXUL\D < DQG 1DVX 0   - 0RO &HOO
&DUGLRO
7HDUH*) +RUDQ 3. 6OH]DN 6 ( 6PLWK &DQG+D\- %  &HOO,PPXQRO

7RQJ - = 'H /DJDXVLH 3 )XUODQ 9 &UHVWHLO 7 %HUQDUG 2 DQG $OYDUH] )  
([S&HOO5HV
7RVLF 0 7RUFK 6 &RPWH 9 'ROLYR 0 +RQHJJHU 3 DQG 0DWWKLHX - 0   -
1HXURFKHP

ϭϮϳ

7]LDPSD]LV(DQG6DPEDQLV$  %LRWHFKQRO3URJ
9DQ%DHO$3URHVPDQV07LOHPDQV'DQG'HQHI&  -0RO(QGR
9HUPHXOHQ 6 9DQPDUFN 9 9DQ+RRUGH / 9DQ5R\ ) %UDFNH 0 DQG 0DUHHO 0
 3DWKRO5HV3UDFW
:DOHK1 6*DOOR-*UDQW 7'0XUSK\ %-.UDPHU5+ DQG6XWKHUODQG 50
 &DQFHU5HV
:DQJ5&ODUN5DQG%DXWFK9/  'HYHORSPHQW
:DQJ=)HUPLQL%)HQJ-DQG1DWWHO6  $P-3K\VLRO +HDUW&LUF3K\VLRO 
  +
:LHVH&&RJROL*UHXWHU0$UJHQWLQL00DGHU7:HLQUHLFK5DQG
:LOOEROG ( 5HLQLFNH 0 /DQFH -RQHV & /DJHQDXU & /HPPRQ 9 DQG /D\HU 3 *
 (XU-1HXURVFL
:LQVRU&3  3URF1DWO$FDG6FL86$
:LQWHUKDOWHU.+  %LRFKHP3KDUPDFRO
:REXV $ 0 5RKZHGHO - 0DOWVHY 9 DQG +HVFKHOHU -   $QQ 1 < $FDG
6FL
:REXV$0.OHSSLVFK70DOWVHY9DQG+HVFKHOHU-  ,Q9LWUR&HOO'HY%LG
$
<DJL.6XPL\RVKL1<DPDGD&0LFKLED\DVKL11DNDVKLPD<.DZDVH0HWDO
 -)HUPHQW%LRHQJ
<DS$6DQG0DQOH\6:  ([S&HOO5HV
<DS $66WHYHQVRQ%5.HDVW-5DQG0DQOH\6:  (QGRFULQRORJ\ 

<HXQJ0&3XOOLDP/DQG/DX$6  $,'6
<XDVD & 7RPLWD < 6KRQR 0 ,VKLPXUD . DQG ,FKLKDUD $   - &HOO 3K\VLRO

=KDQJ-5DVPXVVRQ5/+DOO6.DQG/LHEHUPDQ0  -3K\VLRO
=XULFK0*0RQQHW7VFKXGL)DQG+RQHJJHU3  1HXURWR[LFRORJ\























ϭϮϴ

 &KDSWHU
%LRPDWHULDO6FLHQFH
,QWURGXFWLRQWR%LRPDWHULDOV

7KHGHYHORSPHQWRIELRPDWHULDOVLVQRWDQHZDUHDRIVFLHQFHKDYLQJH[LVWHGIRUDURXQG
KDOI D FHQWXU\ 7KH VWXG\ RI ELRPDWHULDOV LV FDOOHG ELRPDWHULDOV VFLHQFH ,W LV D SURYRFDWLYH
ILHOG RI VFLHQFH KDYLQJ H[SHULHQFHG VWHDG\ DQG VWURQJ JURZWK RYHU LWV KLVWRU\ ZLWK PDQ\
FRPSDQLHV LQYHVWLQJ ODUJH DPRXQWV RI PRQH\ LQWR WKH GHYHORSPHQW RI QHZ SURGXFWV
%LRPDWHULDOV VFLHQFH HQFRPSDVVHV HOHPHQWV RI PHGLFLQH ELRORJ\ FKHPLVWU\ WLVVXH
HQJLQHHULQJDQGPDWHULDOVVFLHQFH

$ELRPDWHULDOLVDQ\PDWHULDOQDWXUDORUPDQPDGHWKDWFRPSULVHVZKROHRUSDUWRID
OLYLQJ VWUXFWXUH RU ELRPHGLFDO GHYLFH ZKLFK SHUIRUPV DXJPHQWV RU UHSODFHV D QDWXUDO
IXQFWLRQ$ ELRPDWHULDOLVDQRQYLDEOHPDWHULDOXVHGLQPHGLFDOGHYLFHVRLW VLQWHQGHGWR
LQWHUDFWZLWKDELRORJLFDOV\VWHP
%LRPDWHULDOVDUHPDWHULDOV V\QWKHWLFDQGQDWXUDOVROLGDQGVRPHWLPHVOLTXLG WKDWDUH
XVHG LQ PHGLFDO GHYLFHV RU LQ FRQWDFW ZLWK ELRORJLFDO V\VWHPV %LRPDWHULDOV DV D ILHOG KDV
VHHQ VWHDG\ JURZWK RYHU LWV DSSUR[LPDWHO\ KDOI FHQWXU\ RI H[LVWHQFH DQG XVHV LGHDV IURP
PHGLFLQH ELRORJ\ FKHPLVWU\ PDWHULDOV VFLHQFH DQG HQJLQHHULQJ 7KHUH LV DOVR D SRZHUIXO
KXPDQ VLGH WR ELRPDWHULDOV WKDW FRQVLGHUV HWKLFV ODZ DQG WKH KHDOWK FDUH GHOLYHU\ V\VWHP
$OWKRXJK ELRPDWHULDOV DUH SULPDULO\ XVHG IRU PHGLFDO DSSOLFDWLRQV WKH\ DUH DOVR XVHG WR
JURZ FHOOV LQ FXOWXUH WR DVVD\ IRU EORRG SURWHLQV LQ WKH FOLQLFDO ODERUDWRU\ LQ SURFHVVLQJ
ELRPROHFXOHVLQELRWHFKQRORJ\IRUIHUWLOLW\UHJXODWLRQLPSODQWVLQFDWWOHLQGLDJQRVWLFJHQH
DUUD\V LQ WKH DTXDFXOWXUH RI R\VWHUV DQG IRU LQYHVWLJDWLRQDO FHOOVLOLFRQ ELRFKLSV 7KH
FRPPRQDOLW\ RI WKHVH DSSOLFDWLRQV LV WKH LQWHUDFWLRQ EHWZHHQ ELRORJLFDO V\VWHPV DQG
V\QWKHWLFRUPRGLILHGQDWXUDOPDWHULDOV
%LRPDWHULDOV DUH UDUHO\ XVHG RQ WKHLU RZQ EXW DUH PRUH FRPPRQO\ LQWHJUDWHG LQWR
GHYLFHV RU LPSODQWV 7KXV WKH VXEMHFW FDQQRW EH H[SORUHG ZLWKRXW DOVR FRQVLGHULQJ
ELRPHGLFDOGHYLFHVDQGWKHELRORJLFDOUHVSRQVHWRWKHP
%LRPDWHULDOV FDQ EH PHWDOV FHUDPLFV SRO\PHUV JODVVHV FDUERQV DQG FRPSRVLWH
PDWHULDOV 6XFK PDWHULDOV DUH XVHG DV PROGHG RU PDFKLQHG SDUWV FRDWLQJV ILEHUV ILOPV
IRDPVDQGIDEULFV
7KH GHILQLWLRQ RI D ELRPDWHULDO GRHV QRW MXVW LQFOXGH PDQPDGH PDWHULDOV ZKLFK DUH
FRQVWUXFWHG RI PHWDOV RU FHUDPLFV $ ELRPDWHULDO PD\ DOVR EH DQ DXWRJUDIW DOORJUDIW RU
[HQRJUDIWXVHGDVDWUDQVSODQWPDWHULDO






$SSOLFDWLRQV


ϭϮϵ

%LRPDWHULDOVDUHXVHGLQ

x -RLQWUHSODFHPHQWV
x %RQHSODWHV
x %RQH&HPHQW
x $UWLILFLDOOLJDPHQWVDQGWHQGRQV
x 'HQWDOLPSODQWVIRUWRRWKIL[DWLRQ
x %ORRGYHVVHOSURVWKHVHV
x +HDUWYDOYHV
x 6NLQUHSDLUGHYLFHV
x &RFKOHDUUHSODFHPHQWV
x &RQWDFWOHQVHV
x %UHDVWLPSODQWV
6XEMHFWVLPSRUWDQWWR%LRPDWHULDOV6FLHQFH
7R[LFRORJ\
$ ELRPDWHULDO VKRXOG QRW EH WR[LF XQOHVV LW LV VSHFLILFDOO\ HQJLQHHUHG IRU VXFK
UHTXLUHPHQWV IRU H[DPSOH D VPDUW ERPE GUXJ GHOLYHU\ V\VWHP WKDW WDUJHWV FDQFHU FHOOV
DQGGHVWUR\VWKHP 6LQFHWKHQRQWR[LFUHTXLUHPHQWLVWKHQRUPWR[LFRORJ\IRUELRPDWHULDOV
KDV HYROYHG LQWR D VRSKLVWLFDWHG VFLHQFH ,W GHDOV ZLWK WKH VXEVWDQFHV WKDW PLJUDWH RXW RI
ELRPDWHULDOV )RU H[DPSOH IRU SRO\PHUV PDQ\ ORZPROHFXODUZHLJKW OHDFKDEOHV H[KLELW
VRPHOHYHORISK\VLRORJLFDFWLYLW\DQGFHOOWR[LFLW\,WLVUHDVRQDEOHWRVD\WKDWDELRPDWHULDO
VKRXOG QRW JLYH RII DQ\WKLQJ IURP LWV PDVV XQOHVV LW LV VSHFLILFDOO\ GHVLJQHG WR GR VR
7R[LFRORJ\DOVRGHDOVZLWKPHWKRGVWRHYDOXDWHKRZZHOOWKLVGHVLJQFULWHULRQLVPHWZKHQD
QHZELRPDWHULDOLVXQGHUGHYHORSPHQW
%LRFRPSDWLELOLW\
7KH XQGHUVWDQGLQJ DQG PHDVXUHPHQW RI ELRFRPSDWLELOLW\ LV XQLTXH WR ELRPDWHULDOV
VFLHQFH 8QIRUWXQDWHO\ ZH GR QRW KDYH SUHFLVH GHILQLWLRQV RU DFFXUDWH PHDVXUHPHQWV RI
ELRFRPSDWLELOLW\0RUHRIWHQWKDQQRW ELRFRPSDWLELOLW\LVGHILQHGLQWHUPVRISHUIRUPDQFH
RUVXFFHVVDWDVSHFLILFWDVN7KXVIRUDSDWLHQWZKRLVGRLQJZHOOZLWKDQLPSODQWHG'DFURQ
IDEULF YDVFXODU SURVWKHVLV IHZ ZRXOG DUJXH WKDW WKLV SURVWKHVLV LV QRW ELRFRPSDWLEOH
+RZHYHUWKHSURVWKHVLVSUREDEO\GLGQRWUHFHOOXODUL]H WKRXJKLWZDVGHVLJQHGWRGRVR DQG
DOVR FDQ WKURZ RII EORRG FORWV HPEROL  WKRXJK WKH HPEROL LQ WKLV FDVH XVXDOO\ KDYH OLWWOH
FOLQLFDOFRQVHTXHQFH7KLVRSHUDWLRQDOGHILQLWLRQRIELRFRPSDWLEOH ³WKHSDWLHQWLVDOLYHVRLW
PXVW EH ELRFRPSDWLEOH´  RIIHUV XV OLWWOH LQVLJKW LQ GHVLJQLQJ QHZ RU LPSURYHG YDVFXODU
SURVWKHVHV ,WLV SUREDEOH WKDW ELRFRPSDWLELOLW\ PD\ RQH GD\ EH GHILQHG IRUDSSOLFDWLRQVLQ
VRIWWLVVXHKDUGWLVVXHDQGWKHFDUGLRYDVFXODUV\VWHP EORRGFRPSDWLELOLW\ 


)XQFWLRQDO7LVVXH6WUXFWXUHDQG3DWKRELRORJ\
%LRPDWHULDOVLQFRUSRUDWHGLQWRPHGLFDOGHYLFHVDUHLPSODQWHGLQWRWLVVXHVDQGRUJDQV
7KHUHIRUHWKHNH\SULQFLSOHVJRYHUQLQJWKHVWUXFWXUHRIQRUPDODQGDEQRUPDOFHOOVWLVVXHV
DQG RUJDQV WKH WHFKQLTXHV E\ ZKLFK WKH VWUXFWXUH DQG IXQFWLRQ RI QRUPDO DQG DEQRUPDO
WLVVXH DUH VWXGLHG DQG WKH IXQGDPHQWDO PHFKDQLVPV RI GLVHDVH SURFHVVHV DUH FULWLFDO
FRQVLGHUDWLRQVWRZRUNHUVLQWKHILHOG

ϭϯϬ

 +HDOLQJ
6SHFLDOSURFHVVHVDUHLQYRNHGZKHQDPDWHULDORUGHYLFHKHDOVLQWKHERG\,QMXU\WR
WLVVXHZLOOVWLPXODWHWKHZHOOGHILQHGLQIODPPDWRU\UHDFWLRQVHTXHQFHWKDWOHDGVWRKHDOLQJ
:KHUHDIRUHLJQERG\ HJDQLPSODQW LVSUHVHQWLQWKHZRXQGVLWH VXUJLFDOLQFLVLRQ WKH
UHDFWLRQVHTXHQFHLVUHIHUUHGWRDVWKHIRUHLJQERG\UHDFWLRQ´7KHQRUPDOUHVSRQVHRIWKH
ERG\ZLOOEHPRGXODWHGEHFDXVHRIWKHVROLGLPSODQW)XUWKHUPRUHWKLVUHDFWLRQZLOOGLIIHULQ
LQWHQVLW\ DQG GXUDWLRQ GHSHQGLQJ XSRQ WKH DQDWRPLFDO VLWH LQYROYHG $Q XQGHUVWDQGLQJ RI
KRZ D IRUHLJQ REMHFW DOWHUV WKH QRUPDO LQIODPPDWRU\ UHDFWLRQ VHTXHQFH LV DQ LPSRUWDQW
FRQFHUQIRUWKHELRPDWHULDOVVFLHQWLVW
'HSHQGHQFHRQ6SHFLILF$QDWRPLFDO6LWHVRI,PSODQWDWLRQ
&RQVLGHUDWLRQRIWKHDQDWRPLFDOVLWHRIDQLPSODQWLVHVVHQWLDO$QLQWUDRFXODUOHQVPD\
JRLQWRWKHOHQVFDSVXOHRUWKHDQWHULRUFKDPEHURIWKHH\H$KLSMRLQWZLOOEHLPSODQWHGLQ
ERQHDFURVVDQDUWLFXODWLQJMRLQWVSDFH$KHDUWYDOYHZLOOEHVXWXUHGLQWRFDUGLDFPXVFOHDQG
ZLOOFRQWDFWERWKVRIWWLVVXHDQGEORRG$FDWKHWHUPD\EHSODFHGLQDQDUWHU\DYHLQRUWKH
XULQDU\ WUDFW (DFK RI WKHVH VLWHV FKDOOHQJHV WKH ELRPHGLFDO GHYLFH GHVLJQHU ZLWK VSHFLDO
UHTXLUHPHQWVIRUJHRPHWU\VL]HPHFKDQLFDOSURSHUWLHVDQGELRUHVSRQVHV
0HFKDQLFDODQG3HUIRUPDQFH5HTXLUHPHQWV
%LRPDWHULDOV DQG GHYLFHV KDYH PHFKDQLFDO DQG SHUIRUPDQFH UHTXLUHPHQWV WKDW
RULJLQDWHIURP WKH SK\VLFDO EXON  SURSHUWLHV RI WKH PDWHULDO 7KHUH DUH WKUHH FDWHJRULHV RI
VXFKUHTXLUHPHQWVPHFKDQLFDOSHUIRUPDQFHPHFKDQLFDOGXUDELOLW\DQGSK\VLFDOSURSHUWLHV
)LUVWFRQVLGHUPHFKDQLFDOSHUIRUPDQFH$KLSSURVWKHVLVPXVWEHVWURQJDQGULJLG$WHQGRQ
PDWHULDO PXVW EH VWURQJ DQG IOH[LEOH $ KHDUW YDOYH OHDIOHW PXVW EH IOH[LEOH DQG WRXJK $
GLDO\VLV PHPEUDQH PXVW EH VWURQJ DQG IOH[LEOH EXW QRW HODVWRPHULF $Q DUWLFXODU FDUWLODJH
VXEVWLWXWH PXVW EH VRIW DQG HODVWRPHULF 7KHQ ZH PXVW DGGUHVV PHFKDQLFDO GXUDELOLW\ $
FDWKHWHU PD\ RQO\ KDYH WR SHUIRUP IRU  GD\V $ ERQH SODWH PD\ IXOILOO LWV IXQFWLRQ LQ 
PRQWKVRUORQJHU$OHDIOHWLQDKHDUWYDOYHPXVWIOH[WLPHVSHUPLQXWHZLWKRXWWHDULQJIRU
WKHOLIHWLPHRIWKHSDWLHQW UHDOLVWLFDOO\DWOHDVWIRURUPRUH\HDUV $KLSMRLQWPXVWQRW
IDLOXQGHUKHDY\ORDGVIRUPRUHWKDQ\HDUV7KHEXONSK\VLFDOSURSHUWLHVZLOODOVRDGGUHVV
RWKHU DVSHFWV RI SHUIRUPDQFH 7KH GLDO\VLV PHPEUDQH KDV D VSHFLILHG SHUPHDELOLW\ WKH
DUWLFXODUFXSRIWKHKLSMRLQWPXVWKDYHKLJKOXEULFLW\DQGWKHLQWUDRFXODUOHQVKDVFODULW\DQG
UHIUDFWLRQ UHTXLUHPHQWV 7R PHHW WKHVH UHTXLUHPHQWV GHVLJQ SULQFLSOHV IURP SK\VLFV
FKHPLVWU\ PHFKDQLFDO HQJLQHHULQJ FKHPLFDO HQJLQHHULQJ DQG PDWHULDOV VFLHQFH DUH
LQYRNHG
,QGXVWULDO,QYROYHPHQW
$ VLJQLILFDQWEDVLFUHVHDUFKHIIRUWLVQRZXQGHUZD\ WR XQGHUVWDQG KRZELRPDWHULDOV
IXQFWLRQDQGKRZWRRSWLPL]HWKHP$WWKHVDPHWLPHFRPSDQLHVDUHSURGXFLQJLPSODQWVIRU
XVHLQKXPDQVDQGDSSURSULDWHWRWKHPLVVLRQRIDFRPSDQ\HDUQLQJSURILWVRQWKHVDOHRI
PHGLFDO GHYLFHV 7KXV DOWKRXJK ZH DUH QRZ RQO\ OHDUQLQJ DERXW WKH IXQGDPHQWDOV RI
ELRLQWHUDFWLRQ ZH PDQXIDFWXUH DQG LPSODQW PLOOLRQV RI GHYLFHV LQ KXPDQV +RZ LV WKLV
GLFKRWRP\H[SODLQHG"%DVLFDOO\DVDUHVXOWRIFRQVLGHUDEOHH[SHULHQFHZHQRZKDYHDVHWRI
PDWHULDOV WKDW SHUIRUPV VDWLVIDFWRULO\ LQ WKH ERG\ 7KH PHGLFDO SUDFWLWLRQHU FDQ XVH WKHP
ZLWKUHDVRQDEOHFRQILGHQFHDQGWKHSHUIRUPDQFHLQWKHSDWLHQWLVODUJHO\DFFHSWDEOH7KRXJK
WKHGHYLFHVDQGPDWHULDOVDUHIDUIURPSHUIHFWWKHFRPSOLFDWLRQVDVVRFLDWHGZLWKWKHGHYLFHV
DUHOHVVWKDQWKHFRPSOLFDWLRQVRIWKHRULJLQDOGLVHDVHV

ϭϯϭ

 7KH FRPSOH[ EDODQFH EHWZHHQ WKH GHVLUH WR DOOHYLDWH VXIIHULQJ DQG GHDWK WKH
H[FLWHPHQWRIQHZVFLHQWLILFLGHDVWKHFRUSRUDWHLPSHUDWLYHWRWXUQDSURILWWKHULVNEHQHILW
UHODWLRQVKLS DQG WKH PDQGDWH RI WKH UHJXODWRU\ DJHQFLHV WR SURWHFW WKH SXEOLF IRUFHV XV WR
FRQVLGHU WKH QHHGV RI PDQ\ FRQVWLWXHQFLHV 2EYLRXVO\ HWKLFDO FRQFHUQV HQWHU LQWR WKH
SLFWXUH$OVRFRPSDQLHVKDYHODUJHLQYHVWPHQWVLQWKHPDQXIDFWXUHTXDOLW\FRQWUROFOLQLFDO
WHVWLQJ UHJXODWRU\ FOHDUDQFH DQG GLVWULEXWLRQ RI PHGLFDO GHYLFHV +RZ PXFK RI DQ
DGYDQWDJH IRU WKH FRPSDQ\ DQG WKH SDWLHQW  ZLOO EH UHDOL]HG LQ LQWURGXFLQJ DQ LPSURYHG
GHYLFH"7KHLPSURYHGGHYLFHPD\LQGHHGZRUNEHWWHUIRUWKHSDWLHQW+RZHYHUWKHFRPSDQ\
ZLOO LQFXU D ODUJH H[SHQVH WKDW ZLOO EH SHUFHLYHG E\ WKH VWRFNKROGHUV DV UHGXFHG SURILWV
0RUHRYHUSURGXFWOLDELOLW\LVVXHVDUHDPDMRUFRQFHUQRIPDQXIDFWXUHUV7KHLQGXVWULDOVLGH
RIWKHELRPDWHULDOVILHOGUDLVHVTXHVWLRQVDERXWWKHHWKLFVRIZLWKKROGLQJLPSURYHGGHYLFHV
IURPSHRSOHZKRQHHGWKHPWKHPDUNHWVKDUHDGYDQWDJHVRIKDYLQJDEHWWHUSURGXFWDQGWKH
JDUJDQWXDQFRVWV SRVVLEO\QRQUHFRYHUDEOH RILQWURGXFLQJDQHZSURGXFWLQWRWKHPHGLFDO
PDUNHWSODFH ,I FRPSDQLHV GLG QRW KDYH WKH SURILW LQFHQWLYH ZRXOG WKHUH EH DQ\ PHGLFDO
GHYLFHVOHWDORQHLPSURYHGRQHVDYDLODEOHIRUFOLQLFDODSSOLFDWLRQ"
:KHQ WKH LQGXVWULDO VHJPHQW RI WKH ELRPDWHULDOV ILHOG LV H[DPLQHG ZH VHH RWKHU
HVVHQWLDOFRQWULEXWLRQVWRRXUILHOG,QGXVWU\GHDOVZHOOZLWKWHFKQRORJLHVVXFKDVSDFNDJLQJ
VWHULOL]DWLRQ VWRUDJH GLVWULEXWLRQ DQG TXDOLW\ FRQWURO DQG DQDO\VLV 7KHVH VXEMHFWV DUH
VSHFLDOL]HG WHFKQRORJLHV RIWHQ LJQRUHG E\ DFDGHPLF UHVHDUFKHUV $OVR PDQ\ FRPSDQLHV
VXSSRUWLQKRXVHEDVLFUHVHDUFKODERUDWRULHVDQGFRQWULEXWHGLUHFWO\WRWKHIXQGDPHQWDOVWXG\
RIELRPDWHULDOV
(WKLFV
$ZLGHUDQJHRIHWKLFDOFRQVLGHUDWLRQVLPSDFWELRPDWHULDOVVFLHQFH/LNHPRVWHWKLFDO
TXHVWLRQV DQ DEVROXWH DQVZHU PD\ EH GLIILFXOW WR FRPH E\ 6RPH DUWLFOHV KDYH DGGUHVVHG
HWKLFDO TXHVWLRQV LQ ELRPDWHULDOV DQG GHEDWHG WKH LPSRUWDQW SRLQWV 6DKD DQG 6DKD 
6FKLHGHUPD\HUDQG6KDSLUR 
5HJXODWLRQ
7KH FRQVXPHU WKH SDWLHQW  GHPDQGV VDIH PHGLFDO GHYLFHV 7R SUHYHQW LQDGHTXDWHO\
WHVWHG GHYLFHV DQG PDWHULDOV IURP FRPLQJ RQ WKH PDUNHW DQG WR VFUHHQ RXW LQGLYLGXDOV
FOHDUO\ XQTXDOLILHG WR SURGXFH ELRPDWHULDOV WKH 8QLWHG 6WDWHV JRYHUQPHQW KDV HYROYHG D
FRPSOH[UHJXODWRU\V\VWHPDGPLQLVWHUHGE\WKH86)RRGDQG'UXJ$GPLQLVWUDWLRQ )'$ 
0RVWQDWLRQVRIWKHZRUOGKDYHVLPLODUPHGLFDOGHYLFHUHJXODWRU\ERGLHV7KH,QWHUQDWLRQDO
6WDQGDUGV 2UJDQL]DWLRQ ,62  KDV LQWURGXFHG LQWHUQDWLRQDO VWDQGDUGV IRU WKH ZRUOG
FRPPXQLW\2EYLRXVO\DVXEVWDQWLDOEDVHRIELRPDWHULDOVNQRZOHGJHZHQWLQWRHVWDEOLVKLQJ
WKHVH VWDQGDUGV 7KH FRVWV WR FRPSO\ ZLWK WKH VWDQGDUGV DQG WR LPSOHPHQW PDWHULDOV
ELRORJLFDO DQG FOLQLFDO WHVWLQJ DUH HQRUPRXV ,QWURGXFLQJ D QHZ ELRPHGLFDO GHYLFH WR WKH
PDUNHW UHTXLUHV D UHJXODWRU\ LQYHVWPHQW RI WHQV RI PLOOLRQV RI GROODUV $UH WKH UHJXODWLRQV
DQGVWDQGDUGVWUXO\DGGUHVVLQJWKHVDIHW\LVVXHV",VWKHFRVWRIUHJXODWLRQLQIODWLQJWKHFRVWRI
KHDOWK FDUH DQG SUHYHQWLQJ LPSURYHG GHYLFHV IURP UHDFKLQJ WKRVH ZKR QHHG WKHP" 8QGHU
WKLV UHJXODWLRQ WRSLF ZH VHH WKH LQWHUVHFWLRQ RI DOO WKH SOD\HUV LQ WKH ELRPDWHULDOV
FRPPXQLW\JRYHUQPHQWLQGXVWU\HWKLFVDQGEDVLFVFLHQFH7KHDQVZHUVDUHQRWVLPSOHEXW
WKHSUREOHPVPXVWEHDGGUHVVHGHYHU\GD\

6\QWKHWLF3RO\PHUVDV%LRPDWHULDOV

$ V\QWKHWLF SRO\PHU LV D ORQJFKDLQ FRPSRXQG GHULYHG E\ ERQGLQJ WRJHWKHU PDQ\
VLQJOH XQLW PROHFXOHV 7KH VLQJOHXQLW PROHFXOHV WKDW FRQVWLWXWH D SRO\PHU DUH NQRZQ DV

ϭϯϮ

PRQRPHUV ([DPSOHV RI V\QWKHWLF SRO\PHUV LQFOXGH QRQ ELRGHJUDGDEOH SRO\PHUV VXFK DV
SRO\HWK\OHQHSRO\ YLQ\OFKORULGH 'DFURQQ\ORQDQG7HIORQDQGELRGHJUDGDEOHSRO\PHUV
VXFK DV SRO\JO\FROLGHV SRO\ODFWLGHV SRO\DQK\GULGHV DQG SRO\VDFFKDULGHV 6\QWKHWLF
SRO\PHUVSRVVHVVXQLTXHIHDWXUHVVXLWDEOHIRUELRORJLFDODSSOLFDWLRQV7KHVHPDWHULDOVFDQEH
PRGXODWHG WR FKDQJH WKHLU FKHPLFDO DQG PHFKDQLFDO SURSHUWLHV DQG FDQ EH WDLORUHG LQWR
YDULRXV VKDSHV ,Q DGGLWLRQ WKHVH PDWHULDOV DUH OLJKW VWURQJ DQG LQHUW 7KXV V\QWKHWLF
SRO\PHULFPDWHULDOVKDYH EHHQ ZLGHO\ XVHGIRU WKH UHSDLUUHSODFHPHQWDQGUHJHQHUDWLRQRI
LQMXUHGDQGGLVRUGHUHGWLVVXHV,QWKLVVHFWLRQWKHFODVVLILFDWLRQVWUXFWXUHDQGSURSHUWLHVRI
V\QWKHWLFSRO\PHUVDVZHOODVWKHLUDSSOLFDWLRQWRWLVVXHHQJLQHHULQJDUHGLVFXVVHG

&ODVVLILFDWLRQ

3RO\PHUV FDQ EH FODVVLILHG LQWR WZR JURXSV DFFRUGLQJ WR RQ WKH PHFKDQLVPV RI
V\QWKHVLVDGGLWLRQSRO\PHUVDQGFRQGHQVDWLRQSRO\PHUV$QDGGLWLRQSRO\PHULVV\QWKHVL]HG
E\FRQQHFWLQJPRQRPHUXQLWVYLDUHDUUDQJLQJFKHPLFDOERQGV7KHIRUPDWLRQRISRO\ YLQ\O
FKORULGH LVDW\SLFDOH[DPSOHRIDGGLWLRQSRO\PHU,QWKLVFDVHWKHGRXEOHERQGRIDVLQJOH
YLQ\O FKORULGH RSHQV XS LQ WKH SUHVHQFH RI DQ LQLWLDWRU VXFK DV D SHUR[LGH PROHFXOH 7KH
LQLWLDWRU FDQ EH DFWLYDWHG E\ LQFUHDVLQJ WHPSHUDWXUH RU H[SRVXUH WR XOWUDYLROHW 7KH LQLWLDWRU
FDQ DFWLYDWH PRQRPHUV WR IRUP IUHH ERQGV ZKLFK FRQQHFW WKH PRQRPHUV WRJHWKHU 7KLV
SURFHVV LV NQRZQ DV SURSDJDWLRQ &RPPRQ DGGLWLRQ SRO\PHUV LQFOXGH SRO\HWK\OHQH
SRO\SURS\OHQHSRO\VW\UHQHDQGSRO\ YLQ\OFKORULGH 

$ FRQGHQVDWLRQ SRO\PHU LV V\QWKHVL]HG E\ MRLQLQJ WZR PROHFXOHV WRJHWKHU ZLWK WKH
HOLPLQDWLRQRIDPROHFXOHVXFKDVZDWHUDQGPHWKDQRO7ZRGLIIHUHQWW\SHVRIPRQRPHUVDUH
XVXDOO\ SDUWLFLSDWLQJ LQ WKH SRO\PHUL]DWLRQ UHDFWLRQ 7KH UHVXOWLQJ SURGXFW LV NQRZQ DV
FRSRO\PHU 1\ORQ LV D W\SLFDO FRSRO\PHU 'XULQJ WKH SRO\PHUL]DWLRQ SURFHVV RI Q\ORQ D
GLFDUER[\OLFDFLGPROHFXOHUHDFWVZLWKDGLDPLQH$ZDWHUPROHFXOHLVUHPRYHGZKHQWKHWZR
PROHFXOHVDUHERQGHG([DPSOHVRIFRQGHQVDWLRQSRO\PHUVLQFOXGHSRO\VDFFKDULGHVSURWHLQV
SRO\HVWHUVSRO\DPLGHVSRO\XUHDSRO\XUHWKDQHDQGFHOOXORVH

%DVHGRQWKHGHJUDGDELOLW\RISRO\PHULFPDWHULDOVLQDELRORJLFDOV\VWHPSRO\PHUVFDQ
EH FODVVLILHG LQWR QRQELRGHJUDGDEOH DQG ELRGHJUDGDEOH SRO\PHUV 1RQ ELRGHJUDGDEOH
SRO\PHUV FDQQRW EH GHJUDGHG ZKHUHDV ELRGHJUDGDEOH SRO\PHUV FDQ EH GHJUDGHG LQ D
ELRORJLFDO V\VWHP ([DPSOHV RI QRQELRGHJUDGDEOH SRO\PHUV XVHG DV ELRPDWHULDOV LQFOXGH
SRO\HWK\OHQHSRO\WHWUDIOXRURHWK\OHQHSRO\ YLQ\OFKORULGH DQGSRO\SURS\OHQH([DPSOHVRI
ELRGHJUDGDEOH SRO\PHUV LQFOXGH SRO\JO\FROLGHV SRO\ODFWLGHV SRO\VDFFKDULGHV DQG SRO\ Į
K\GUR[\O DFLGV  ,Q WHUPV RI WKH W\SH RI PRQRPHU LQ D SRO\PHU VWUXFWXUH SRO\PHUV FDQ EH
FODVVLILHG LQWR KRPRSRO\PHUV DQG KHWHURSRO\PHUV RU FRSRO\PHUV  +RPRSRO\PHUV DUH
FRPSRXQGV FRQVWLWXWHG ZLWK RQH W\SH RI UHSHDWHG PRQRPHUV ([DPSOHV RI KRPRSRO\PHUV
LQFOXGH SRO\HWK\OHQH SRO\WHWUDIOXRURHWK\OHQH SRO\ YLQ\O FKORULGH  DQG SRO\SURS\OHQH
&RSRO\PHUV DUH SRO\PHULF FRPSRXQGV FRPSRVHG RI WZR RU PRUH W\SHV RI PRQRPHU 7KH
GLIIHUHQWPRQRPHUVPD\EHUDQGRPO\GLVWULEXWHGRUPD\DOWHUQDWHLQDSDWWHUQ([DPSOHVRI
FRSRO\PHUVLQFOXGHSRO\ JO\FROLGHODFWLGH SRO\XUHWKDQHDQG SRO\ JO\FROLGHWULPHWK\OHQH
FDUERQDWH 

*HQHUDO3URSHUWLHV

3RO\PHULFPDWHULDOVH[LVWLQVHYHUDOIRUPVLQFOXGLQJOLTXLGHODVWRPHUDQGSODVWLF7KH
IRUP RI SRO\PHULF PDWHULDOV LV GHWHUPLQHG E\ D QXPEHU RI IDFWRUV LQFOXGLQJ WKH QDWXUH RI
PRQRPHUVWKHVL]HDQGIRUPRISRO\PHUPROHFXOHV WKHW\SHDQGFRQFHQWUDWLRQRIFDWDO\VWV

ϭϯϯ

XVHGIRUSRO\PHUV\QWKHVLVDQGFXULQJWHPSHUDWXUHDQGGXUDWLRQ%\VHOHFWLYHO\DOWHULQJWKHVH
IDFWRUV D GHVLUHG IRUP RI SRO\PHULF PDWHULDOV FDQ EH JHQHUDWHG $Q LPSRUWDQW IDFWRU WKDW
LQIOXHQFHV WKH VWUXFWXUH DQG PHFKDQLFDO SURSHUWLHV VXFK DV IOH[LELOLW\ DQG VWUHQJWK RI
SRO\PHULFPDWHULDOVLVWKHFRPSRVLWLRQRISRO\PHUPROHFXOHV$VXEVWLWXWLRQRIDNH\DWRPLQ
DPRQRPHUPD\LQGXFHD VLJQLILFDQWFKDQJHLQ WKH PHFKDQLFDO SURSHUWLHV)RULQVWDQFHWKH
UHSODFHPHQWRIWKHFDUERQDWRPZLWKR[\JHQLQDSRO\HWK\OHQHPROHFXOHUHGXFHVWKHULJLGLW\
RIWKHSRO\PHU

7KHPROHFXODUVL]HRUSRO\PHULFFKDLQOHQJWKLVDQRWKHUFULWLFDOIDFWRUWKDWGHWHUPLQHV
WKH VWUXFWXUH DQG PHFKDQLFDO SURSHUWLHV RI SRO\PHULF PDWHULDOV 3RO\PHUV DUH FRPSRVHG RI
YDULRXV QXPEHUV RI PRQRPHUV )RU WKH VDPH W\SH RI PRQRPHU D ORQJHU SRO\PHU LV PRUH
IOH[LEOHDQGWDQJOHGPRUHHDVLO\WKDQDVKRUWHURQH)RULQVWDQFHSRO\HWK\OHQHDQGSDUDIILQ
FDQ EH V\QWKHVL]HG EDVHG RQ WKH VDPH W\SH RI PRQRPHU &+&+ EXW ZLWK GLIIHUHQW FKDLQ
OHQJWK 7KH OHQJWK RI D SDUDIILQ PROHFXOH LV PXFK VKRUWHU WKDQ WKDW RI D SRO\HWK\OHQH
PROHFXOH 7KH ORQJFKDLQHG SRO\HWK\OHQH PROHFXOHV DUH PRUH GLIILFXOW WR FU\VWDOOL]H WKXV
H[KLELWLQJKLJKHUIOH[LELOLW\FRPSDUHGWRSDUDIILQ7KHFKDLQOHQJWKRISRO\PHUVLVRQHRIWKH
IDFWRUV WKDW GHWHUPLQHV WKH ULJLGLW\ DQG VWUHQJWK RI SRO\PHU PDWHULDOV $Q LQFUHDVH LQ WKH
FKDLQOHQJWKUHGXFHVWKHPRELOLW\RISRO\PHUPROHFXOHVDQGWKXVHQKDQFHVWKHULJLGLW\DQG
VWUHQJWK7KHIRUP RISRO\PHU PROHFXOHV LVDPDMRUIDFWRUWKDWLQIOXHQFHVWKHVWUXFWXUHDQG
RUJDQL]DWLRQ RI SRO\PHULF PDWHULDOV 3RO\PHU PROHFXOHV H[LW LQ VHYHUDO IRUPV OLQHDU
EUDQFKHGDQGFURVVOLQNHGIRUPV$OLQHDUSRO\PHUPROHFXOHLVFRPSRVHGRIDVLQJOHFKDLQ
RI PRQRPHUV ZLWK YDULRXV OHQJWKV DQG PROHFXODU ZHLJKWV ([DPSOHV RI OLQHDU SRO\PHUV
LQFOXGHSRO\YLQ\OVDQGSRO\HVWHUV7KHVHPROHFXOHVFDQEHSDUWLDOO\FU\VWDOOL]HGWRIRUPVR
FDOOHG VHPLFU\VWDOOLQH SRO\PHUV ,W LV XVXDOO\ GLIILFXOW WR FRPSOHWHO\ FU\VWDOOL]H WKHVH
SRO\PHUV

$ EUDQFKHG SRO\PHU PROHFXOH LV FRPSRVHG RI D PDLQ FKDLQ DQG YDULRXV GHQVLWLHV RI
VLGH FKDLQV &RSRO\PHUL]DWLRQ PD\ HQKDQFH WKH IRUPDWLRQ RI EUDQFKHV 6LQFH WKH VLGH
EUDQFKHVLQIOXHQFHWKHLQWHUDFWLRQEHWZHHQWKHPDLQSRO\PHUFKDLQVWKHLQWURGXFWLRQRIVLGH
EUDQFKHVPD\UHGXFHSRO\PHUFU\VWDOOL]DWLRQ\LHOGLQJPRUHIOH[LEOHSRO\PHUV$QLQFUHDVHLQ
WKH OHQJWK RI WKH VLGH FKDLQ UHGXFHV WKH PHOWLQJ WHPSHUDWXUH RI WKH SRO\PHU LQ DVVRFLDWLRQ
ZLWKDUHGXFWLRQLQFU\VWDOOL]DWLRQ

3RO\PHU PROHFXOHV FDQ EH FURVV OLQNHG WR IRUP QHWZRUNV /RQJFKDLQ SRO\PHU
PROHFXOHV DUH XVXDOO\ OLQNHG WRJHWKHU ZLWK VLGH FKDLQV &URVV OLQNHG SRO\PHUV DUH XVXDOO\
GLIILFXOWWRFU\VWDOOL]H$QLQFUHDVHLQWKHGHJUHHRIFURVVOLQNLQJUHGXFHVWKHFU\VWDOOL]DWLRQ
FDSDELOLW\ RI SRO\PHULF PDWHULDOV 8S WR D FHUWDLQ GHJUHH RI FURVV OLQNLQJ SRO\PHU
FU\VWDOOL]DWLRQ PD\ EH FRPSOHWHO\ SUHYHQWHG 'XULQJ WKH FURVV OLQNLQJ SURFHVV WKH IRUP RI
PRQRPHUVDQGUHDFWLRQFRQGLWLRQVPD\LQIOXHQFHWKHVWUXFWXUHDQGPHFKDQLFDOSURSHUWLHVRI
WKHSRO\PHULFPDWHULDO)RULQVWDQFHWKHSUHVHQFHRIWRUWXRXVDQGFXUYHGSRO\PHUFKDLQVPD\
UHVXOW LQ D SRO\PHULF PDWHULDO WKDW LV HODVWLF DQG IOH[LEOH 7KLV W\SH RI PDWHULDO FDQ EH
VWUHWFKHGWRDODUJHH[WHQWDQGFDQUHWXUQEDFNWRWKHXQGHIRUPHGOHQJWKXSRQWKHUHOHDVHRI
WKHVWUHWFKLQJIRUFH1DWXUDOUXEEHU FLVSRO\LVRSUHQH LVDW\SLFDOH[DPSOHRIVXFKPDWHULDOV

,Q DGGLWLRQ WR WKH LQWULQVLF IDFWRUV RI SRO\PHULF PROHFXOHV HQYLURQPHQWDO IDFWRUV
LQIOXHQFH WKH VWUXFWXUH DQG PHFKDQLFDO SURSHUWLHV RI SRO\PHULF PDWHULDOV $ W\SLFDO
HQYLURQPHQWDOIDFWRULVWHPSHUDWXUH$QLQFUHDVHLQWHPSHUDWXUHRIWHQUHGXFHVWKHULJLGLW\RI
SRO\PHULFPDWHULDOVDQGLQGXFHVWKHWUDQVIRUPDWLRQRISRO\PHUIURPSODVWLFWRHODVWRPHUDQG
OLTXLG


ϭϯϰ

1RQELRGHJUDGDEOH3RO\PHUV

3RO\WHWUDIOXRURHWK\OHQH

3RO\WHWUDIOXRURHWK\OHQH 37)(  LV D IOXRURFDUERQ SRO\PHU DOVR NQRZQ DV 7HIORQ
ZKLFK LV FRPPRQO\ XVHG DV D ELRPDWHULDO IRU WKH UHSODFHPHQW RI VRIW WLVVXHV 7HIORQ LV
FKDUDFWHUL]HG E\ KLJK FU\VWDOOL]DWLRQ DERXW  PROHFXOHV FU\VWDOOL]HG  D UHODWLYHO\ KLJK
GHQVLW\ ‫׽‬JFP DQGORZVXUIDFHWHQVLRQDQGIULFWLRQFRPSDUHGWRRWKHUW\SHVRISRO\PHU
7HIORQLVXVHGSULPDULO\IRUWKHFRQVWUXFWLRQRIYDVFXODUVXEVWLWXWHV7HIORQYDVFXODUJUDIWVDUH
VXIILFLHQWO\VWURQJIRUZLWKVWDQGLQJVWUHWFKLQJIRUFHVLQGXFHGE\DUWHULDOEORRGSUHVVXUH7KH
PHFKDQLFDO SURSHUWLHV RI 7HIORQ JUDIWV FDQ EH VWDEOH IRU \HDUV IROORZLQJ LPSODQWDWLRQ
%HFDXVH 7HIORQ VWLPXODWHV LQIODPPDWRU\ UHDFWLRQV DQG WKURPERJHQHVLV ZKLFK OHDG WR WKH
GHYHORSPHQWRILQWLPDOK\SHUSODVLDLWFDQRQO\EHXVHGIRUWKHUHSODFHPHQWRIDUWHULHVODUJHU
WKDQ  PP LQ GLDPHWHU 7HIORQ FDQ DOVR EH XVHG WR FRQVWUXFW VXSSRUWLQJ VKHDWKV IRU YHLQ
JUDIWV DQ DSSURDFK IRU PRGXODWLQJ WKH GLDPHWHU RI WKH YHLQ JUDIW UHGXFLQJ GLDPHWHU
PLVPDWFKLQGXFHG GLVWXUEDQFH RI EORRG IORZ DQG VXSSUHVVLQJ IORZ GLVWXUEDQFHLQGXFHG
LQWLPDOK\SHUSODVLD

3RO\ HWK\OHQHWHUHSKWKDODWH 

3RO\ HWK\OHQH WHUHSKWKDODWH  3(7  NQRZQ DV 'DFURQ LV D SRO\HVWHU PDWHULDO WKDW LV
FKDUDFWHUL]HG E\ K\GURSKRELFLW\ UHVLVWDQFHWR K\GURO\VLV DQG KLJK VWUHQJWK DQG WRXJKQHVV
'DFURQKDVSULPDULO\EHHQXVHGIRUWKHFRQVWUXFWLRQRIYDVFXODUJUDIWV3RURXVJUDIWVFDQEH
FRQVWUXFWHG E\ ZHDYLQJ 3(7 ILEUHV LQWR PHVKOLNH PDWHULDOV 7KLV W\SH RI JUDIW XVXDOO\
IDFLOLWDWHV FHOO LQWHJUDWLRQ LQWR WKH JUDIW ZDOO ZKHQ DQDVWRPRVHG LQWR D KRVW DUWHU\ 'DFURQ
JUDIWV DUH RIWHQ XVHG WR UHSODFH PDOIXQFWLRQHG WKRUDFLF DQG DEGRPLQDO DRUWDH $V RWKHU
SRO\PHULFPDWHULDOV'DFURQLQGXFHVLQIODPPDWRU\UHDFWLRQVDQGWKURPERJHQHVLV7KXVWKLV
W\SHRIJUDIWFDQRQO\EHDSSOLHGWRDUWHULHVZLWKGLDPHWHUH[FHHGLQJPP

3RO\HWK\OHQH

3RO\HWK\OHQH LV D SRO\PHU FRPSRVHG RI HWK\OHQH PRQRPHUV DQG FDQ EH V\QWKHVL]HG
LQWRSRO\PHULFPDWHULDOVRIYDULRXVGHQVLWLHV$ORZGHQVLW\SRO\HWK\OHQHPDWHULDO ±
JFP  FDQ EH V\QWKHVL]HG E\ XVLQJ SHUR[LGH FDWDO\VWV DW SUHVVXUH ± NJFP  DQG
WHPSHUDWXUH ±ž& 3RO\HWK\OHQH PDWHULDOV JHQHUDWHG XQGHU VXFK FRQGLWLRQV DUH
FRPSRVHGRIEUDQFKHGSRO\PHUVWKDWDUHGLIILFXOWWRFU\VWDOOL]H7KLVW\SHRIPDWHULDOLVWRXJK
DQGIOH[LEOHDQGLVRIWHQXVHGWRIDEULFDWHWKLQPHPEUDQHVIRUIRRGSDFNDJLQJDQGDOVRIRU
PDQXIDFWXULQJELRPHGLFDOVXSSOLHVVXFKDVWXELQJDQGFRQWDLQHUV

$KLJKGHQVLW\SRO\HWK\OHQHPDWHULDO ±JFP FDQEHV\QWKHVL]HGE\XVLQJ
PHWDOFDWDO\VWV DW SUHVVXUH ‫ ׽‬NJFP DQG WHPSHUDWXUH ±ž& 7KLV SRO\PHU PDWHULDO LV
FRPSRVHG SULPDULO\ OLQHDU SRO\PHUV DQG LV KLJKO\ FU\VWDOOL]HG ZLWK VWURQJ ERQGV EHWZHHQ
HWK\OHQHPRQRPHUV7KHKLJKGHQVLW\SRO\HWK\OHQHPDWHULDOLVVWURQJHUWKDQWKHORZGHQVLW\
SRO\HWK\OHQHPDWHULDODQGKDVEHHQXVHGIRUIDEULFDWLQJRUWKRSDHGLFLPSODQWVVXFKDVORDG
EHDULQJFDSVIRUDUWLILFLDOMRLQWV

%LRGHJUDGDEOH3RO\PHUV

$ QXPEHU RI ELRGHJUDGDEOH SRO\PHULF PDWHULDOV KDYH EHHQ V\QWKHVL]HG DQG XVHG DV
ELRPDWHULDOV 7KHVH PDWHULDOV EHORQJ WR VHYHUDO SRO\PHU IDPLOLHV LQFOXGLQJ OLQHDU DOLSKDWLF

ϭϯϱ

SRO\HVWHUV SRO\RUWKRHVWHUV SRO\SKRVSKDWH HVWHUV SRO\ HVWHU±HWKHU  SRO\DQK\GULGHV
SRO\DPLGHV SRO\VDFFKDULGHV SRO\DPLQR DFLGV DQG LQRUJDQLF SRO\SKRVSKD]HQHV 6RPH RI
WKHVHSRO\PHUVKDYHEHHQLQFUHDVLQJO\XVHGIRUWKHUHJHQHUDWLRQUHSDLUDQGUHSODFHPHQWRI
WLVVXHVDQGRUJDQV%HFDXVHWKHVHPDWHULDOVFDQEHJUDGXDOO\GHJUDGHGDQGUHPRYHGWKURXJK
YDULRXVRUJDQV\VWHPVVXFKDVWKHOLYHUDQGNLGQH\VKDUPIXOLQIOXHQFHVLIDQ\LPSRVHGE\
WKHVHPDWHULDOVFDQEHHOLPLQDWHG)XUWKHUPRUHZKHQXVHGIRUFRQVWUXFWLQJWLVVXHVFDIIROGV
ELRGHJUDGDEOH SRO\PHUV ZLWK GHVLUHG VKDSHV FDQ VHUYH DV JXLGDQFH IRU FHOO PLJUDWLRQ DQG
SDWWHUQ IRUPDWLRQ :LWK WKH GHJUDGDWLRQ RI WKH SRO\PHU VFDIIROG QDWXUDO WLVVXHV FDQ EH
JUDGXDOO\HVWDEOLVKHGDQGVWUHQJWKHQHGHYHQWXDOO\LQWHJUDWLQJLQWRWKHKRVWV\VWHP

%LRGHJUDGDEOH SRO\PHULF PDWHULDOV KDYH EHHQ DSSOLHG WR ELRPHGLFDO UHVHDUFK LQ
SULPDULO\ WZR DUHDV ZRXQG KHDOLQJ DQG GUXJ GHOLYHU\ /LQHDU DOLSKDWLF SRO\HVWHUV VXFK DV
SRO\JO\FROLGHV SRO\ JO\FROLGHOODFWLGH  SRO\ HVWHU±HWKHU  DQG SRO\ JO\FROLGH±
WULPHWK\OHQH FDUERQDWH  KDYH EHHQ VXFFHVVIXOO\ XVHG IRU HQKDQFLQJ ZRXQG FORVXUH DQG
KHDOLQJ7KHVHSRO\PHUVKDYHEHHQH[WHQVLYHO\VWXGLHGIRUWKHLUVWUXFWXUHPDWHULDOSURSHUWLHV
DQG ELRORJLFDO FRPSDWLELOLW\ 6HYHUDO W\SHV RI ELRGHJUDGDEOH SRO\PHU KDYH EHHQ XVHG IRU
FRQVWUXFWLQJGUXJGHOLYHU\FDUULHUV([DPSOHVLQFOXGHSRO\DQK\GULGHVDQGSRO\ HVWHU±HWKHU 
%\FRQWUROOLQJWKHUDWHRIGHJUDGDWLRQWKHUDWHRIGUXJGHOLYHU\FDQEHUHJXODWHG,QDGGLWLRQ
ELRGHJUDGDEOHSRO\PHUVKDYHEHHQLQYHVWLJDWHGIRUWKHLUSRWHQWLDOXVHLQWLVVXHUHJHQHUDWLRQ
DQG UHSDLU )RU WKH ODVW GHFDGH VLQFH WKH PLGV  WKH V\QWKHVLV DQG FKDUDFWHUL]DWLRQ RI
ELRGHJUDGDEOHSRO\PHUVDUHDPRQJWKHPRVWDFWLYHUHVHDUFKDUHDVLQELRPHGLFDOHQJLQHHULQJ
+HUH VHYHUDO FRPPRQ W\SHV RI ELRGHJUDGDEOH SRO\PHUV DUH GLVFXVVHG ZLWK D IRFXV RQ WKH
VWUXFWXUHPDWHULDOSURSHUWLHVDQGSRWHQWLDODSSOLFDWLRQVWRELRUHJHQHUDWLYHHQJLQHHULQJ

/LQHDU$OLSKDWLF3RO\HVWHUV

/LQHDUDOLSKDWLFSRO\HVWHUV DUHVWUDLJKWFKDLQSRO\PHUVLQZKLFKPRQRPHUVDUHMRLQHG
E\ WKH HVWHU ERQG ²&22² &RPPRQO\ XVHG OLQHDU DOLSKDWLF SRO\HVWHUV LQFOXGH
SRO\JO\FROLGH 3*  RU SRO\ JO\FROLF DFLG  3*$  SRO\ODFWLGH 3/  RU SRO\ ODFWLF DFLG 
3/$  SRO\FDSURODFWRQH 3&/  SRO\ ȕK\GUR[\EXW\UDWH  DQG SRO\ JO\FROLGH±WULPHWK\OHQH
FDUERQDWH  7KHVH SRO\PHUV KDYH EHHQ VXFFHVVIXOO\ XVHG LQ ELRPHGLFDO UHVHDUFK DQG
DSSOLFDWLRQ $PRQJ WKHVH DOLSKDWLF SRO\PHUV SRO\JO\FROLGH DQG SRO\ODFWLGH DUH EDVLF
PROHFXOHVWKDWFDQEHXVHGWRIRUPFRSRO\PHUVDQGGHULYHGLIIHUHQWIRUPVRISRO\PHUV7KHVH
SRO\PHUVKDYHEHHQIUHTXHQWO\XVHGLQELRPHGLFDOUHVHDUFK




3RO\JO\FROLGHVDQG3RO\ODFWLGHV

3RO\JO\FROLGHVDQGSRO\ODFWLGHVFDQEHV\QWKHVL]HGIURPJO\FROLFDFLGVDQGODFWLFDFLGV
UHVSHFWLYHO\ 7KH GLUHFW FRQGHQVDWLRQ PHWKRG FDQ EH XVHG WR V\QWKHVL]H ORZPROHFXODU
ZHLJKW SRO\JO\FROLGHV RU SRO\ODFWLGHV  N'D  &RPPRQ FDWDO\VWV IRU VXFK V\QWKHVLV
LQFOXGHSKRVSKRULFDFLGVSWROXHQHVXOSKRQLFDFLGDQGDQWLPRQ\WULIOXRULGH)RUDSRO\PHU
ODUJHU WKDQ  N'D D SURFHVV NQRZQ DV ULQJ RSHQLQJ SRO\PHUL]DWLRQ LV QHFHVVDU\ IRU
SRO\PHU V\QWKHVLV 6HYHUDO FDWDO\VWV VXFK DV VWDQQRXV FKORULGH GHK\GUDWH DQG DOXPLQXP
DONR[LGH KDV EHHQ XVHG IRU WKH V\QWKHVLV RI ODUJH SRO\JO\FROLGHV DQG SRO\ODFWLGHV 7KH
WKHUPDOSURSHUWLHVRISRO\PHUVDUHGHVFULEHGE\WKHPHOWLQJDQGJODVVWUDQVLWLRQWHPSHUDWXUH
ZKLOH WKH PHFKDQLFDO SURSHUWLHV RI SRO\PHUV DUH H[SUHVVHG E\ WKH HODVWLF PRGXOXV WHQVLOH
VWUHQJWKDQGPD[LPDOGLVWHQVLELOLW\RUVWUDLQ$W\SLFDOSRO\JO\FROLGHPDWHULDOKDVDPHOWLQJ

ϭϯϲ

WHPSHUDWXUH RI ‫ &ž׽‬DQG D JODVV WUDQVLWLRQ WHPSHUDWXUH RI ‫ &ž׽‬ZKHUHDV D SRO\ODFWLGH
PDWHULDO SRVVHVVHV D PHOWLQJ WHPSHUDWXUH RI ‫ &ž׽‬DQG D JODVV WUDQVLWLRQ WHPSHUDWXUH RI
‫&ž׽‬0HFKDQLFDOO\SRO\ODFWLGHEDVHGPDWHULDOVSRVVHVVHODVWLFPRGXOLUDQJLQJIURP
WR03DDQGWHQVLOHVWUHQJWKRI±03DGHSHQGLQJRQWKHPROHFXODUZHLJKWDQGFDQ
EHH[WHQGHGWR±RIWKHLURULJLQDOOHQJWKEHIRUHUHDFKLQJWKHEUHDNSRLQW

7KHUDWHRISRO\PHUELRGHJUDGDWLRQLVDQLPSRUWDQWSDUDPHWHUFRQVLGHUHGLQWKHGHVLJQ
DQGV\QWKHVLVRIELRGHJUDGDEOHSRO\PHUV3RO\PHUVDUHXVXDOO\GHJUDGHGE\K\GURO\VLVRIWKH
HVWHU ERQGV UHVXOWLQJ LQ D GHFUHDVH LQ PROHFXODU ZHLJKW 6HYHUDO IDFWRUV DUH NQRZQ WR
LQIOXHQFH WKH UDWH RI SRO\PHU GHJUDGDWLRQ 7KHVH LQFOXGH WKH FKHPLFDO VWUXFWXUH DQG
PROHFXODUZHLJKWRIWKHSRO\PHUPDWHULDODVZHOODVHQYLURQPHQWDOFRQGLWLRQV)RULQVWDQFH
DPRUSKRXV SRO\PHUV FDQ GHJUDGH PRUH HDVLO\ WKDQ FU\VWDOOLQH SRO\PHUV 3RO\PHUV ZLWK D
KLJKHU PROHFXODU ZHLJKW PD\ EH GHJUDGHG PRUH VORZO\ WKDQ WKRVH ZLWK D ORZHU PROHFXODU
ZHLJKW %UDQFKHG SRO\PHU PROHFXOHV PD\ EH GHJUDGHG IDVWHU WKDQ OLQHDU PROHFXOHV $Q
LQFUHDVH LQ WHPSHUDWXUH IDFLOLWDWHV SRO\PHU GHJUDGDWLRQ )RU D W\SLFDO VHPLFU\VWDOOLQH
SRO\ODFWLGH PDWHULDO ZHLJKW ORVV FDQ EH GHWHFWHG DIWHU  ZHHNV LQ D SKRVSKDWH EXIIHU DW
ž&

*O\FROLGHV DQG ODFWLGHV FDQ IRUP FRSRO\PHUV ZLWK HDFK RWKHU DV ZHOO DV ZLWK RWKHU
W\SHVRIHVWHUV7KHFRSRO\PHUIRUPHGRQWKHEDVLVRIJO\FROLGHVDQGOODFWLGHVLVNQRZQDV
SRO\ JO\FROLGHOODFWLGH  7KH UHODWLYH FRQWHQWV RI YDULRXV HVWHUV LQ D FRSRO\PHU PD\
LQIOXHQFH WKH UDWH RI SRO\PHU GHJUDGDWLRQ )RU LQVWDQFH WKH GHJUDGDWLRQ UDWH RI SRO\
JO\FROLGHOODFWLGH LVGHSHQGHQWRQWKHUHODWLYHFRQFHQWUDWLRQRIODFWLGHV,WLVLQWHUHVWLQJWR
QRWH WKDW WKH UHODWLRQVKLS LV QRW OLQHDU ,Q WKH UDQJH RI ± RI OODFWLGHV WKH UDWH RI
GHJUDGDWLRQLVLQYHUVHO\SURSRUWLRQDOWRWKHFRQFHQWUDWLRQRIOODFWLGHVZKHUHDVLQWKHUDQJH
RI±RIOODFWLGHVWKHUDWHRIGHJUDGDWLRQLVGLUHFWO\SURSRUWLRQDOWRWKHFRQFHQWUDWLRQ
RI ODFWLGHV ,QWHUHVWLQJO\ LQ WKH UDQJH RI ± RI OODFWLGHV WKH UDWH RI SRO\PHU
GHJUDGDWLRQGRHV QRW FKDQJH VLJQLILFDQWO\ ZLWK DQ LQFUHDVH LQ WKH FRQFHQWUDWLRQRI ODFWLGHV
7KXV IRU WKH GHVLJQ RI D FRSRO\PHU WKH GHJUDGDWLRQ UDWH VKRXOG EH WDNHQ LQWR DFFRXQW
,GHDOO\DSRO\PHUPDWHULDOVKRXOGKDYHDGHJUDGDWLRQUDWHWKDWLVFRPSDUDEOHWRWKHUDWHRI
QDWLYHWLVVXHIRUPDWLRQ

3RO\JO\FROLGHV SRO\ODFWLGHV DQG WKHLU FRSRO\PHUV KDYH EHHQ XVHG IRU FRQVWUXFWLQJ
YDULRXVIRUPVRIPDWUL[IRUELRPHGLFDODSSOLFDWLRQVVXFKDVGUXJGHOLYHU\DQGWLVVXHUHSDLU
7KHVHSRO\PHUVFDQEHDOVRLQMHFWHGLQWRWDUJHWWLVVXHV7KHELRFRPSDWLELOLW\DQGWR[LFLW\RI
WKHVHSRO\PHUVKDYHEHHQWHVWHGH[WHQVLYHO\7KHGHJUDGDWLRQSURGXFWRISRO\ODFWLGHVLVODFWLF
DFLG ZKLFK LV D QDWXUDO PHWDEROLWH LQ PDPPDOV DQG FDQ EH UHPRYHG YLD SK\VLRORJLFDO
PHWDEROLVP 7KH PHWDEROLWH RI SRO\JO\FROLGHV JO\FROLF DFLG KDV EHHQ VKRZQ WR EH D ORZ
WR[LFLW\ VXEVWDQFH $Q LQFUHDVH LQ DFLGLW\ QHDU D SRO\PHU LPSODQW PD\ RFFXU EXW VXFK D
FKDQJH FDQ EH PLWLJDWHG E\ D ORFDO S+ WUHDWPHQW ,Q JHQHUDO WKHVH SRO\PHUV H[KLELW ORZ
WR[LFLW\DQGDUHVDIHIRULQYLYRLPSODQWDWLRQDQGLQMHFWLRQ



3RO\FDSURODFWRQHV

3RO\FDSURODFWRQH 3&/  DUH DQRWKHU W\SH RI SRO\HVWHU WKDW LV XVHG LQ ELRPHGLFDO
UHVHDUFK DQG DSSOLFDWLRQ 3RO\FDSURODFWRQHV FDQ EH V\QWKHVL]HG E\ SRO\PHUL]DWLRQ ZLWK
DQLRQLFFDWLRQLFDQGFRRUGLQDWLRQFDWDO\VWV)RUWKHDQLRQLFFDWDO\WLFV\VWHPWHUWLDU\DPLQHV
DONDOLPHWDODONR[LGHVDQGFDUER[\ODWHVDUHQHFHVVDU\IRUWKHSRO\PHUL]DWLRQ)RUWKHFDWLRQLF

ϭϯϳ

SRO\PHUL]DWLRQ V\VWHP VHYHUDO FDWDO\VWV LQFOXGLQJ SURWLF DFLGV /HZLV DFLGV DF\ODWLQJ
DJHQWVDQGDON\ODWLQJDJHQWVDUHRIWHQXVHG7KHFRRUGLQDWLRQSRO\PHUL]DWLRQV\VWHPLVXVHG
IRU V\QWKHVL]LQJ KLJKPROHFXODUZHLJKW SRO\PHUV &DWDO\VWV IRU WKLV W\SH RI SRO\PHUL]DWLRQ
LQFOXGH VWDQQRXV RFWRDWH DOLNR[LGHV DQG PHWDOOLF HOHPHQWV VXFK DV $O 6Q 0J DQG 7L
3RO\FDSURODFWRQH PDWHULDOV XVXDOO\ KDYH WKH IROORZLQJ WKHUPDO SURSHUWLHV PHOWLQJ
WHPSHUDWXUH‫&ž׽‬DQGJODVVWUDQVLWLRQWHPSHUDWXUH‫׽‬íž&0HFKDQLFDOO\SRO\FDSURODFWRQH
PDWHULDOVFDQEHVWUHWFKHGWRDVWUDLQDERXW ‫׽‬HORQJDWLRQ DWD\LHOGLQJVWUHVVDERXW
03D7KHHODVWLFPRGXOXVLVDERXW*3D

3RO\FDSURODFWRQHPDWHULDOVDQGSRO\FDSURODFWRQHK\EULGVZLWKRWKHUPDWHULDOVVXFKDV
K\GUR[\DSDWLWH SRO\OODFWLGHV DQG VLOLFD KDYH EHHQ XVHG LQ D QXPEHU RI ELRPHGLFDO
DSSOLFDWLRQVVXFKDVVFDIIROGLQJDQGUHSDLULQJVRIWDQGERQHWLVVXHV )LJ 3RO\FDSURODFWRQH
PDWHULDOV FDQ EH GHJUDGHG E\ K\GURO\VLV ,Q YLYR WHVWV KDYH VKRZQ WKDW LW WDNHV DERXW ±
\HDUVWRFRPSOHWHO\GHJUDGHDSRO\FDSURODFWRQHLPSODQW&RSRO\PHUL]DWLRQRUEOHQGLQJZLWK
JO\FROLGHVDQGRUODFWLGHVLQFUHDVHVWKHUDWHRIGHJUDGDWLRQ,QYLYRDQLPDOWHVWVKDYHVKRZQ
WKDW SRO\FDSURODFWRQH PDWHULDOV H[KLELW ORZ WR[LFLW\ DQG GR QRW VLJQLILFDQWO\ LQIOXHQFH WKH
IXQFWLRQRIKRVWFHOOVDQGWLVVXHV

3RO\ ȕK\GUR[\EXW\UDWH 

3RO\ ȕK\GUR[\ EXW\UDWH  RU 3+% LV D SRO\PHU RI ȕK\GUR[\EXW\UDWH 3RO\ ȕ
K\GUR[\EXW\UDWH FDQEHJHQHUDWHGE\QDWXUDOIHUPHQWDWLRQRIWKHEDFWHULXP$OFDOLJHQHVDQG
FDQ DOVR EH V\QWKHVL]HG E\ WKH SODQW IOD[ RU OLQXPXVLWDWLVVLPXP ZKLFK LV JHQHWLFDOO\
WUDQVIHFWHG ZLWK JHQH FRQVWUXFWV UHTXLUHG IRU WKH V\QWKHVLV RI SRO\ ȕK\GUR[\ EXW\UDWH  RU
RWKHU W\SHV RI SODQWV VXFK DV $UDELGRSVLV WKDOLDQD DQG %UDVVLFD QDSXV 3RO\ ȕK\GUR[\
EXW\UDWH LVDQDPRUSKRXVPDWHULDOZLWKDJODVVWUDQVLWLRQWHPSHUDWXUHRIDERXWíž&DQGD
PHOWLQJWHPSHUDWXUHRI‫&ž׽‬7KHIDLOXUHVWUDLQ VWUDLQZKHQDPDWHULDOLVH[WHQGHGWRWKH
IDLOXUH SRLQW  RI SRO\ ȕK\GUR[\EXW\UDWH  LV DERXW  RU  :KHQ SRO\ ȕ
K\GUR[\EXW\UDWH  LV EOHQGHG ZLWK RWKHU W\SHV RISRO\PHUV VXFKDV K\GUR[\O KH[DQRDWH WKH
IDLOXUHVWUDLQFDQEHLQFUHDVHGGHSHQGLQJRQWKHUHODWLYHFRQWHQWVRIWKHSRO\PHUFRPSRQHQWV
7KHSRO\ ȕK\GUR[\EXW\UDWH FRQWDLQLQJFRSRO\PHUFDQEHIDEULFDWHGLQWRYDULRXVIRUPVDQG
XVHG IRU FRQVWUXFWLQJ WLVVXH UHSODFHPHQWV )LJ  7KH GHJUDGDWLRQ RI SRO\ ȕ
K\GUR[\EXW\UDWH LVLQGXFHGE\K\GURO\VLV

,Q YLWUR WHVWV KDYH VKRZQ WKDW KLJKPROHFXODUZHLJKW SRO\ ȕK\GUR[\EXW\UDWH  ILOPV
FDQEHFRPSOHWHO\GHJUDGHGDWž&LQIUHVKZDWHUZLWKLQZHHNV


ϭϯϴ

 
)LJXUH  6FDQQLQJ HOHFWURQ PLFURVFRSLF LPDJHV RI IUHH]H IUDFWXUH K\GUR[\DSDWLWH
+$3 SRO\FDSURODFWRQH 3&/ FRPSRVLWHPDWHULDOV


3RO\FDUERQDWHV

3RO\FDUERQDWHV DUH D JURXS RI SRO\HVWHUV LQFOXGLQJ SRO\ XUHWKDQH FDUERQDWH 
SRO\ HWK\OHQH FDUERQDWH  DQG SRO\ SURS\OHQH FDUERQDWH  7KHVH SRO\PHUV DUH V\QWKHVL]HG
ZLWK GLK\GUR[\ FRPSRXQGV DQG FDUERQ\O FKORULGH )RU DOLSKDWLF SRO\ XUHWKDQH FDUERQDWH 
WKHJODVVWUDQVLWLRQWHPSHUDWXUH LVDERXWíž&7KH WHQVLOHIDLOXUHVWUHVVRIWKLVSRO\PHULV
DERXW  03D DQG WKH IDLOXUH VWUDLQ LV DERXW  &OHDUO\ WKLV LV D KLJKO\ H[WHQGDEOH
PDWHULDO7KHGHJUDGDWLRQUDWHYDULHVDPRQJGLIIHUHQWSRO\FDUERQDWHPDWHULDOV)RULQVWDQFH
SRO\ HWK\OHQHFDUERQDWH WDEOHWVLPSODQWHGLQWKH UDWFDQEHGHJUDGHGZLWKLQDERXWGD\V
SRO\ SURS\OHQHFDUERQDWH PD\ODVWIRUGD\VZKHUHDVSRO\ XUHWKDQHFDUERQDWH LVVWDEOH
IRU D PXFK ORQJHU WLPH 7KLV FODVV RI SRO\PHULF PDWHULDOV DUH ELRFRPSDWLEOH DQG KDV EHHQ
XVHG IRU FHOO FXOWXUH )LJ  7KHVH PDWHULDOV KDYH DOVR EHHQ XVHG DV ELRPDWHULDOV IRU
FRQVWUXFWLQJ FDUGLRYDVFXODU LPSODQWV LQWUD DRUWLF EDOORRQV FDUGLDF YDOYHV YDVFXODU
SURVWKHVHVSDFHPDNHUOHDGVYHQWULFXODUDVVLVWGHYLFHVDQGDUWLILFLDOKHDUWGLDSKUDJPVKHDUW
YDOYHV YDVFXODU JUDIWV DQG XUHWKUDO FDWKHWHUV  DV ZHOO DV UHFRQVWUXFWLYH LPSODQWV ZRXQG
GUHVVLQJVPDPPDU\SURVWKHVHVPD[LOORIDFLDOSURVWKHVHV 

3RO\DPLGHV

$SRO\DPLGHLVDSRO\PHUWKDWLVIRUPHGE\MRLQLQJPRQRPHUVZLWKDQDPLGHERQG²
&21+²1DWXUDOSURWHLQVDUHDPLGHEDVHGSRO\PHUV$PLQRDFLGVFDQEHXVHGWRV\QWKHVL]H
DUWLILFLDOSRO\DPLGHV7\SLFDOH[DPSOHVDUHSRO\JOXWDPLFDFLGDQGSRO\O\VLQH*OXWDPLFDFLG
DQGO\VLQHFDQDOVRIRUPFRSRO\PHUVZLWKRWKHUW\SHVRIDPLQRDFLGV8QOLNHRWKHUV\QWKHWLF
SRO\PHUV WKDW KDYH EHHQWHVWHG LQELRPHGLFDO UHVHDUFK SRO\PHUV EDVHG RQ DPLQR DFLGV DUH
FRPSRVHG RI QDWXUDOO\ RFFXUULQJ PROHFXOHV DQG WKXV SRVVHVV ORZ WR[LFLW\ 6XFK D IHDWXUH
UHQGHUV WKHVH SRO\PHUV SURPLVLQJ FDQGLGDWHV DV ELRPDWHULDOV IRU WLVVXH UHSDLU DQG
UHJHQHUDWLRQ DV ZHOO DV GUXJ GHOLYHU\ +HUH SRO\ JOXWDPLF DFLG LV XVHG DV DQ H[DPSOH WR

ϭϯϵ

GHPRQVWUDWH WKH SULQFLSOHV RI WKH V\QWKHVLV PDWHULDO SURSHUWLHV DQG SRWHQWLDO ELRPHGLFDO
DSSOLFDWLRQRISRO\DPLGHV




)LJXUH  6FDQQLQJ HOHFWURQ PLFURVFRSLF LPDJHV RI SRO\ K\GUR[\EXW\UDWHFR
K\GUR[\KH[DQRDWH EDVHGELRPDWHULDOV
$ SRO\ K\GUR[\EXW\UDWHFRK\GUR[\OKH[DQRDWH PDWHULDOV
% SRO\ K\GUR[\EXW\UDWHFRK\GUR[\KH[DQRDWH ZLWKJHODWLQEOHQG
& SRO\ K\GUR[\EXW\UDWHFRK\GUR[\KH[DQRDWH ZLWKJHODWLQEOHQG
' SRO\ K\GUR[\EXW\UDWHFRK\GUR[\KH[DQRDWH ZLWKJHODWLQEOHQG

3RO\ JOXWDPLF DFLG  FDQ EH V\QWKHVL]HG IURP SRO\ ȖEHQ]\OOJOXWDPDWH  E\
HOLPLQDWLQJWKHEHQ]\OJURXSE\XVLQJK\GURJHQEURPLGH3RO\ JOXWDPLFDFLG  3*$ FDQEH
GHJUDGHGE\HQ]\PDWLFK\GURO\VLV,QSDUWLFXODUF\VWHLQSURWHDVHVSOD\DFULWLFDOUROHLQWKH
GHJUDGDWLRQ RI 3*$ 7KH WLPH FRXUVH RI 3*$ GHJUDGDWLRQ UDQJHV IURP VHYHUDO KRXUV WR
PRQWKV GHSHQGLQJ RQWKHFRQFHQWUDWLRQ RI SURWHLQDVH WHPSHUDWXUHDQG WKH FRPSRVLWLRQ RI
WKH SRO\PHU ZLWK RU ZLWKRXW DGGLWLRQDO FRPSRQHQWV  3RO\ JOXWDPLF DFLG  H[KLELWV OLWWOH
WR[LFLW\ ZKHQ LPSODQWHG LQWR DQ DQLPDO WLVVXH $QLPDOV FDQ WROHUDWH D VLQJOH GRVH RI ”
PJNJ DQG DQ DFFXPXODWHG GRVH RI ” JNJ 3RO\JOXWDPLF DFLG H[KLELWV OLWWOH

ϭϰϬ

LPPXQRJHQLFLW\LQDQLPDOPRGHOV7KLVW\SHRIPDWHULDOVFDQEHXVHGLQYDULRXVELRPHGLFDO
DSSOLFDWLRQVVXFKDVWLVVXHUHSDLUDQGUHJHQHUDWLRQDVZHOODVGUXJGHOLYHU\


3RO\SKRVSKD]HQHV

3RO\SKRVSKD]HQHV DUH LQRUJDQLF ELRGHJUDGDEOH SRO\PHUV WKDW DUH FRQVWLWXWHG ZLWK D
QLWURJHQ±SKRVSKRUXV 1 3 EDFNERQH7KLVW\SHRISRO\PHULVV\QWKHVL]HGYLDUHDFWLRQVRI
SRO\GLFKORURSKRVSKD]HQH ZLWK DPLQHV RU DONR[LGHV LQ WHWUDK\GURIXUDQ RU DURPDWLF
K\GURFDUERQH VROXWLRQV 3RO\PHUV ZLWK YDULRXV VLGH JURXSV FDQ EH V\QWKHVL]HG E\ PL[LQJ
GLIIHUHQW FRPSRQHQWV 7KH PDWHULDO SURSHUWLHV RI SRO\SKRVSKD]HQHV DUH GHSHQGHQW RQ WKH
FRPSRVLWLRQRIWKHSRO\PHU%LRGHJUDGDEOHSRO\SKRVSKD]HQHVFDQEHJHQHUDWHGZKHQDPLQR
DFLG GHULYDWLYHV DUH XVHG DV VLGH JURXSV )RU LQVWDQFH WKH HWK\OJO\FLQDWRGHULYHG SRO\PHUV
FDQEHGHJUDGHGLQWRDPPRQLDSKRVSKDWHHWKDQRODQGJO\FLQH([SHULPHQWDOWHVWV LQYLWUR
KDYHGHPRQVWUDWHGWKDWDPLQRDFLGEDVHGSRO\SKRVSKD]HQHVFDQEHGHJUDGHGZLWKLQVHYHUDO
PRQWKV 7KH UDWH RI GHJUDGDWLRQ LV GHSHQGHQW RQ WKH W\SH RI DPLQR DFLG VHOHFWHG IRU WKH
VLGHJURXSV



)LJXUH  6FDQQLQJ HOHFWURQ PLFURVFRSLF LPDJHV RI 0* RVWHREODVWOLNH FHOOV GD\
FXOWXUH DWWDFKHGWRWKHSRO\FDUERQDWHPHPEUDQHVXUIDFHVZLWKGLIIHUHQWPLFURSRUHVL]HV $ 
 %  &  '  ( DQG ) ȝPLQGLDPHWHURIPLFURSRUHVL]HV

ϭϰϭ

 3RO\SKRVSKD]HQHV KDYH EHHQ XVHG IRU FRQVWUXFWLQJ YDULRXV VWUXFWXUHV VXFK DV PDWUL[
VFDIIROGV )LJ   K\GURJHOV DQG PLFURVSKHUHV IRU GUXJ GHOLYHU\ 7KH GHJUDGDWLRQ RI
SRO\SKRVSKD]HQHVLVVHQVLWLYHWRFKDQJHVLQWHPSHUDWXUH7KXVWKHGHJUDGDWLRQUDWHRIWKHVH
SRO\PHUVFDQEHUHJXODWHGE\FRQWUROOLQJHQYLURQPHQWDOWHPSHUDWXUH6XFKSRO\PHUVFDQEH
XVHG IRU FRQVWUXFWLQJ GUXJ GHOLYHU\ FDUULHUV IRU WHPSHUDWXUHUHODWHG GLVHDVHV 2WKHU
HQYLURQPHQWDO IDFWRUV VXFK DV S+ PD\ DOVR LQIOXHQFH WKH UDWH RI GHJUDGDWLRQ RI
SRO\SKRVSKD]HQHV)RULQVWDQFHR[\EHQ]RDWHFRQWDLQLQJSRO\SKRVSKD]HQHVDUHS+VHQVLWLYH
7KH GHJUDGDWLRQ RI WKLV W\SH RI SRO\PHU FDQ EH FRQWUROOHG E\ DOWHULQJ WKH FRQWHQW RI
R[\EHQ]RDWHZLWKLQDVSHFLILHGUDQJHRIS+6XFKSRO\PHUVFDQEHXVHGWRGHOLYHUGUXJIRU
GLVHDVHV WKDW UHVXOWLQD FKDQJH LQ S+ ,Q YLYR DQLPDO WHVWV ZLWK VXEFXWDQHRXV LPSODQWDWLRQ
KDYH VKRZQ WKDW SRO\SKRVSKD]HQHV PDWHULDOV H[KLELW ORZ WR[LFLW\ LQGXFH OLWWOH LQIODPDWRU\
UHDFWLRQVLQKRVWWLVVXHVDQGDUHUHODWLYHO\VDIHIRULPSODQWDWLRQDQGGUXJGHOLYHU\



)LJXUH  6FDQQLQJ HOHFWURQ PLFURJUDSK VKRZLQJ HOHFWURVSXQ SRO\>ELV SPHWK\OSKHQR[\ 
SKRVSKD]HQHILEUHPDWUL[ZLWKDUWHULDOHQGRWKHOLDOFHOOVDIWHUKRIFXOWXUH

3RO\DQK\GULGHV

3RO\DQK\GULGHV DUH SRO\PHUV IRUPHG ZLWK DQK\GULGHV FRPSRXQGV LQ ZKLFK WZR
FDUERQ\OJURXSVDUHMRLQHGZLWKDQR[\JHQDWRP5&2²2²&25ƍZKHUH5DQG5ƍDUHDQ\
RUJDQLFJURXSV7KHSRO\PHUVDUHV\QWKHVL]HGE\UHDFWLRQVRIGLDFLGVZLWKDQK\GULGHVWRIRUP
DFHW\O DQK\GULGH SUHSRO\PHUV +LJKPROHFXODUZHLJKW SRO\DQK\GULGHV FDQ EH IRUPHG IURP
WKH SUHSRO\PHUV E\ PHOW FRQGHQVDWLRQ ž& IRU  PLQ LQ YDFXR  7KH DGGLWLRQ RI
FRRUGLQDWLRQ FDWDO\VWV VXFK DV FDGPLXP DFHWDWH DQG PHWDO R[LGHV FDQ IDFLOLWDWH WKH
SRO\PHUL]DWLRQSURFHVVLQFUHDVLQJWKHPROHFXODUZHLJKWRIWKHSRO\PHU3RO\DQK\GULGHVFDQ
EH GLVVROYHG LQ RUJDQLF VROYHQWV VXFK DV FKORURIRUP DQG GLFKORURPHWKDQH 9DULRXV
FRPSRQHQWVFDQEHFRSRO\PHUL]HGZLWKDQK\GULGHVWRDOWHUWKHVROXELOLW\+RPRSRO\PHUVRI
DQK\GULGHV XVXDOO\ H[KLELW D KLJK OHYHO RI FU\VWDOOLQLW\ &RSRO\PHUL]DWLRQ ZLWK GLIIHUHQW
FRPSRQHQWV PD\ UHGXFH WKH FU\VWDOOLQLW\ SURGXFLQJ PRUH DPRUSKRXV PDWHULDOV
&RSRO\PHUL]DWLRQDOVRLQIOXHQFHVWKHPHFKDQLFDOSURSHUWLHVRISRO\DQK\GULGHV

ϭϰϮ

 3RO\DQK\GULGHVDUHGHJUDGHGE\K\GURO\WLFHURVLRQ$QXPEHURIIDFWRUVLQIOXHQFHWKH
UDWH RI SRO\DQK\GULGHV GHJUDGDWLRQ 7KHVH LQFOXGH S+ DQG FRSRO\PHUL]DWLRQ ZLWK GLIIHUHQW
FRPSRXQGV$QLQFUHDVHLQS+IDFLOLWDWHV SRO\DQK\GULGHV GHJUDGDWLRQ 7KH LQFRUSRUDWLRQ RI
GLIIHUHQW DOLSKDWLF PRQRPHUV PD\ IDFLOLWDWH WKH GHJUDGDWLRQ RI WKH SRO\PHU ZKHUHDV WKH
DGGLWLRQ RI PHWK\OHQH JURXSV LQWR WKH SRO\PHU EDFNERQH UHGXFHV WKH UDWH RI GHJUDGDWLRQ
7KXV SRO\DQK\GULGHV ZLWK YDULRXV OHYHOV RI GHJUDGDWLRQ FDQ EH V\QWKHVL]HG E\
FRSRO\PHUL]DWLRQZLWKYDULRXVFRPSRXQGV3RO\DQK\GULGHVFDQEHXVHGWRFRQVWUXFWYDULRXV
IRUPV RI PDWUL[VXFKDV GLVNVDQG SHOOHWVDQGFDQDOVR EH LQMHFWHG LQWR WDUJHW WLVVXHV 7KH
LQMHFWLRQ RI PL[HG SRO\DQK\GULGHV DQG WKHUDSHXWLF VXEVWDQFHV LV D SURPLVLQJ WHFKQLTXH IRU
FRQWUROOHG GUXJ GHOLYHU\ $ QXPEHU RI VWXGLHV KDYH VKRZQ WKDW SRO\DQK\GULGHV GR QRW
VLJQLILFDQWO\LQIOXHQFHWKHJURZWKRIFXOWXUHGFHOOVDQGH[KLELWOLWWOHWR[LFLW\ZKHQLPSODQWHG
LQWRWDUJHWWLVVXHVLQDQLPDOWHVWV

%LRORJLFDOPDWHULDOV

&ROODJHQ0DWUL[

&ROODJHQ PDWUL[ LV IRXQG LQ PHVHQFK\PDO DQG FRQQHFWLYH WLVVXHV VXFK DV WKH
VXEFXWDQHRXVWLVVXH DQGERQH DQGWKHDGYHQWLWLDRI WXEXODU RUJDQV EORRG YHVVHOV DLUZD\V
HVRSKDJXV VWRPDFK DQG LQWHVWLQHV  ,Q PDPPDOLDQ WLVVXHV WKHUH H[LVW DERXW  W\SHV RI
FROODJHQPDWUL[QDPHO\FROODJHQW\SHV,±;9$PRQJWKHVHW\SHVRIFROODJHQW\SHV,,,,,,
,99,;;,DQG;,,DUHFRPPRQO\IRXQGLQFRQQHFWLYHWLVVXHV&ROODJHQW\SHV,,,,,,9
DQG;,DUHRUJDQL]HGLQWRILODPHQWRXVVWUXFWXUHVNQRZQDVFROODJHQILEULOVZLWKDGLDPHWHU
RI‫׽‬±QP7KHVHILEULOVXVXDOO\IRUPODUJHFROODJHQEXQGOHVDVIRXQGLQVXEFXWDQHRXV
WLVVXHV DQG WKH DGYHQWLWLD RI WXEXODU RUJDQV &ROODJHQ W\SHV , DQG 9 DUH RIWHQ IRXQG LQ WKH
ERQHVNLQFRUQHDWHQGRQOLJDPHQWDQGLQWHUQDORUJDQVVXFKDVWKHOXQJOLYHUSDQFUHDVDQG
NLGQH\ &ROODJHQ W\SHV ,, DQG ;, DUH IRXQG LQ WKH FDUWLODJH QRWRFKRUG DQG LQWHUYHUWHEUDO
GLVNV&ROODJHQW\SH,,,LVIRXQGLQEORRGYHVVHOVVNLQDQGLQWHUQDO RUJDQV&ROODJHQW\SHV
,; DQG ;,, DUH PROHFXOHV WKDW OLQN RWKHU W\SHV RI FROODJHQ ILEULO DQG DUH NQRZQ DV ILEULO
DVVRFLDWHG FROODJHQV 7KHVH W\SHV DUH IRXQG LQ WKH FDUWLODJH WHQGRQV DQG OLJDPHQWV ,Q
FRQWUDVW WR WKH ILODPHQWRXV FROODJHQ PROHFXOHV FROODJHQ W\SH ,9 SDUWLFLSDWHV LQ WKH
FRQVWUXFWLRQ RI D PHPEUDQHOLNH VWUXFWXUH NQRZQ DV WKH EDVDO ODPLQD ZKLFK XQGHUOLHV
HSLWKHOLDODQGHQGRWKHOLDOFHOOV

&ROODJHQ PROHFXOHV SOD\ LPSRUWDQW UROHV LQ WKH FRQVWLWXWLRQ RI PDPPDOLDQ WLVVXHV RU
RUJDQV 7KH FROODJHQ PDWUL[ VHUYHV DV D VWUXFWXUDO IUDPHZRUN WKDW VXSSRUWV FHOOV KHOSV
RUJDQL]H FHOOV LQWR YDULRXV IRUPV RI WLVVXHVDQG RUJDQV DQG SURWHFWV FHOOV IURP PHFKDQLFDO
LQMXU\,QDGGLWLRQFROODJHQPDWUL[SDUWLFLSDWHVLQWKHUHJXODWLRQRIFHOOXODUDFWLYLWLHVVXFKDV
FHOOVXUYLYDODGKHVLRQSUROLIHUDWLRQDQGPLJUDWLRQ&ROODJHQPROHFXOHVFDQGLUHFWO\LQWHUDFW
ZLWK FHOOV YLD WKH FHOO PHPEUDQH FROODJHQ UHFHSWRUV RU LQGLUHFWO\ YLD WKH PHGLDWLRQ RI
ILEURQHFWLQDPDWUL[FRPSRQHQWWKDWELQGVFROODJHQPROHFXOHVDWRQHVLGHDQGFHOOPHPEUDQH
PDWUL[ UHFHSWRUV NQRZQ DV LQWHJULQV DW WKH RWKHU VLGH 7KH ELQGLQJ RI FROODJHQ DQG
ILEURQHFWLQPROHFXOHVWRWKHLQWHJULQUHFHSWRUVLQLWLDWHWKHDFWLYDWLRQRILQWUDFHOOXODUVLJQDOLQJ
SDWKZD\VWKDWVWLPXODWHRUDFWLYDWHPLWRJHQLFSURFHVVHVLQFOXGLQJFHOOVXUYLYDOSUROLIHUDWLRQ
DQGPLJUDWLRQ

*LYHQ WKH VWUXFWXUDO DQG IXQFWLRQDO IHDWXUHV FROODJHQ PDWUL[ KDV ORQJ EHHQ XVHG IRU
FRQVWUXFWLQJGUXJGHOLYHU\GHYLFHVDQGVFDIIROGVIRUWLVVXHUHJHQHUDWLRQ&ROODJHQPDWUL[KDV
EHHQXVHGLQVHYHUDOIRUPVFROODJHQJHOVPHVKHVFRPSRVLWHVZLWKGLIIHUHQWPROHFXOHVDQG
GHFHOOXODUL]HG QDWXUDO PDWUL[ &ROODJHQ JHOV DQG PHVKHV DUH VXLWDEOH IRU GUXJ GHOLYHU\

ϭϰϯ

ZKHUHDVFHOOIUHHQDWXUDOFROODJHQPDWUL[FDQEHXVHGDVVFDIIROGVRUJUDIWVIRUWKHUHSDLURU
UHJHQHUDWLRQ RI YDULRXV WLVVXHV DQG RUJDQV VXFK DV EORRG YHVVHOV DLUZD\V LQWHVWLQHV DQG
EODGGHU &ROODJHQ JHO FDQ EH VSXQ LQWR FROODJHQ ILEUHV ZKLFK FDQ EH XVHG WR FRQVWUXFW
FROODJHQVFDIIROGVIRUWLVVXHUHSDLUDQGUHJHQHUDWLRQ )LJ 

1DWLYH FROODJHQ PDWUL[ LV D VXLWDEOH PDWHULDO IRU WKH FRQVWUXFWLRQ RI WLVVXH VFDIIROGV
6XFKDPDWHULDOPDLQWDLQVWKHQDWXUDOELRORJLFDODQGPHFKDQLFDOFKDUDFWHULVWLFVDQGH[KLELWV
VXSHULRU ELRFRPSDWLELOLW\ FRPSDUHG WR LQ YLWUR FURVVOLQNHG FROODJHQ JHOV RU PDWUL[ 7R
SUHSDUH D QDWLYH FROODJHQ PDWUL[ PDPPDOLDQ WLVVXH VSHFLPHQV FDQ EH FROOHFWHG IURP WKH
VXEPXFRVDRILQWHVWLQHVWKHDGYHQWLWLDRIEORRGYHVVHOVDQGWKHVXEFXWDQHRXVWLVVXH&HOOVLQ
WKHVH VSHFLPHQV FDQ EH UHPRYHG E\ YDULRXV HQ]\PDWLF DQG K\GURO\WLF PHWKRGV 6XFK
WUHDWPHQWVHOLPLQDWHWKHFHOOXODULPPXQRJHQLFLW\RIDOORJHQLFWLVVXHV QRWHWKDWH[WUDFHOOXODU
PDWUL[ PROHFXOHV H[KLELW QHJOLEOH LPPXQRJHQLFLW\  7KH UHVXOWLQJ FHOOIUHH FROODJHQ PDWUL[
FDQEHWDLORUHGLQWRDVFDIIROGZLWKDGHVLUHGIRUPDQGXVHGIRUWLVVXHUHSDLURUUHJHQHUDWLRQ


)LJXUH6FDQQLQJHOHFWURQPLFURJUDSKRIHOHFWURVSXQFROODJHQPDWUL[


(ODVWLF)LEUHVDQG/DPLQDH

(ODVWLF ILEUHV DQG ODPLQDH DUH PDMRU H[WUDFHOOXODU PDWUL[ FRPSRQHQWV IRXQG LQ
PHVHQFK\PDODQGFRQQHFWLYHWLVVXHV(ODVWLFILEUHVDUHSUHVHQWLQWKHOXQJFRQQHFWLYHWLVVXH
WKH VXEPXFRVD RI LQWHVWLQHV DQG WKH ZDOO RI YHLQV ZKHUHDV HODVWLF ODPLQDH DUH IRXQG
SULPDULO\LQWKHPHGLDRIODUJHDQGPHGLXPDUWHULHV(ODVWLFILEUHVDQGODPLQDHDUHFRPSRVHG
RIVHYHUDOSURWHLQVLQFOXGLQJHODVWLQPLFURILEULOVDQGPLFURILEULODVVRFLDWHGSURWHLQV(ODVWLQ
LVWKHPRVWDEXQGDQWSURWHLQLQHODVWLFILEUHVDQGODPLQDH0DWXUHHODVWLQLVDKLJKO\LQVROXEOH
DQGK\GURSKRELFSURWHLQDQGLVIRUPHGE\FURVVOLQNLQJWKHN'DHODVWLQSUHFXUVRUNQRZQ
DVWURSRHODVWLQ7URSRHODVWLQLVSURGXFHGE\VHYHUDOFHOOW\SHVLQFOXGLQJWKHVPRRWKPXVFOH
FHOO HQGRWKHOLDO FHOO DQG ILEUREODVW DQG LV UHOHDVHG LQWR WKH H[WUDFHOOXODU VSDFH ZKHUH
FURVVOLQNLQJ DQG HODVWLQ IRUPDWLRQ WDNH SODFH (ODVWLF ILEUHV DQG ODPLQDH SOD\ DQ LPSRUWDQW
UROHLQWKHFRQVWLWXWLRQRIWLVVXHVDQGRUJDQVDVZHOODVLQWKHPDLQWHQDQFHRIWKHVWDELOLW\RI
WLVVXHVDQGRUJDQV)RULQVWDQFHPXOWLSOHOD\HUVRIHODVWLFODPLQDHDUHIRXQGLQODUJHDUWHULHV

ϭϰϰ

7KHVHODPLQDHKDYHORQJEHHQNQRZQWRFRQWULEXWHWRWKHVWUXFWXUDOVWDELOLW\DQGPHFKDQLFDO
VWUHQJWK RI WKH DUWHULDO ZDOO $UWHULHV DUH VXEMHFW WR H[WHQVLYH PHFKDQLFDO VWUHVV LQGXFHG E\
DUWHULDO EORRG SUHVVXUH :LWKRXW WKH VXSSRUW RI WKH HODVWLF ODPLQDH YDVFXODU FHOOV PD\ EH
RYHUVWUHWFKHGXQGHUDUWHULDOEORRGSUHVVXUH(ODVWLFODPLQDHDOVRFRQWULEXWHWRWKHHODVWLFLW\RI
VRIWWLVVXHVVXFKDVFRQQHFWLYHWLVVXHVDQGDUWHULHV7KHUHFRLORIWKHDUWHULDOZDOOLVDFULWLFDO
PHFKDQLVP IRU WKH FRQWLQXDWLRQ RI EORRG IORZ GXULQJ GLDVWROH ZKHQ FDUGLDF HMHFWLRQ LV
FHDVHG(ODVWLFODPLQDHKDYHDOVREHHQVKRZQWRVHUYHDVDVLJQDOOLQJVWUXFWXUHDQGSOD\DUROH
LQ UHJXODWLQJ DUWHULDOPRUSKRJHQHVLV DQG SDWKRJHQHVLV $Q LPSRUWDQW FRQWULEXWLRQ RI HODVWLF
ODPLQDHLVWRFRQILQHVPRRWKPXVFOHFHOOVWRWKHDUWHULDOPHGLDE\LQKLELWLQJVPRRWKPXVFOH
FHOO SUROLIHUDWLRQ DQG PLJUDWLRQ WKXV SUHYHQWLQJ LQWLPDO K\SHUSODVLD XQGHU SK\VLRORJLFDO
FRQGLWLRQV,QDGGLWLRQHODVWLFODPLQDHH[KLELWDQWLLQIODPPDWRU\HIIHFWVDQGLQKLELWOHXNRF\WH
DGKHVLRQ DFWLYDWLRQ DQG WUDQVPLJUDWLRQ UHODWLYH WR FROODJHQ PDWUL[ 7KHVH IHDWXUHV UHQGHU
HODVWLFODPLQDHDSRWHQWLDOPDWHULDOIRUYDVFXODUUHFRQVWUXFWLRQ)XUWKHUPRUHHODVWLFODPLQDH
DQGHODVWLQFRQWDLQLQJVWUXFWXUHVFDQEHXVHGWRSUHYHQWLQIODPPDWRU\UHDFWLRQVDIWHUVXUJHU\

3RO\VDFFKDULGHV

3RO\VDFFKDULGHVDUHSRO\PHUVFRPSRVHGRIPDQ\PRQRVDFFKDULGHVERQGHGWRJHWKHUE\
JO\FRVLGLF ERQGV 7KHUH DUH D QXPEHU RI IRUPV RI QDWXUDO SRO\VDFFKDULGHV LQFOXGLQJ
JO\FRJHQFHOOXORVHDOJLQDWHFKLWRVDQVWDUFKDQGJO\FRVDPLQRJO\FDQ7KHVHSRO\VDFFKDULGHV
DUHIRXQGLQDQLPDOVDQGSODQWVDQGSOD\DQLPSRUWDQWUROHIRUWKHVXUYLYDODQGIXQFWLRQRI
DQLPDOVDQGSODQWV*O\FRJHQLVDSRO\PHUFRPSRVHGRIJOXFRVHPRQRPHUVDQGV\QWKHVL]HG
LQ DQLPDOV IRU WKH VWRUDJH RI HQHUJ\ $OJLQDWHV DUH OLQHDU SRO\VDFFKDULGHV FRPSRVHG RI ȕ
PDQQXURQLF DFLG DQG ĮJXOXURQLF DFLG DQG DUH IRXQG LQ EURZQ VHDZHHG DQG LQ FHUWDLQ
EDFWHULD 6WDUFK LV D SRO\PHU IRXQG LQ SODQWV DQG V\QWKHVL]HG IRU WKH VWRUDJH RI HQHUJ\
&HOOXORVHLVIRXQGLQSODQWVDQGEDFWHULD&KLWRVDQLVIRXQGLQWKHVKHOORIFUDEVDQGVKULPSV
2QH RI WKH LPSRUWDQW SURSHUWLHV RI SRO\VDFFKDULGHV LV WKHLU DELOLW\ WR IRUP K\GURJHO 7KLV
SURSHUW\ LV WKH EDVLV IRU SRO\VDFFKDULGHPHGLDWHG GUXJ GHOLYHU\ 6HYHUDO W\SHV RI
SRO\VDFFKDULGHVXFKDVFHOOXORVHFKLWRVDQDQGVWDUFKKDYHEHHQXVHGDVPDWHULDOVIRUWLVVXH
HQJLQHHULQJDQGGUXJGHOLYHU\

&HOOXORVH

&HOOXORVH LV D OLQHDU SRO\VDFFKDULGH FRPSRVHG RI GJOXFRVH XQLWV MRLQWHG WRJHWKHU E\
ȕJOXFRVLGLF ERQGV ,Q SODQWV FHOOXORVH SDUWLFLSDWHV LQ WKHFRQVWLWXWLRQ RISODQW VNHOHWRQ
DQGFHOOZDOO&RWWRQLVDZHOONQRZQFHOOXORVHFRQWDLQLQJPDWHULDO&HOOXORVHPROHFXOHVDUH
RIWHQDUUDQJHGLQ SDUDOOHO JLYLQJ FHOOXORVHILEUHV KLJKPHFKDQLFDOVWUHQJWK+XPDQVFDQQRW
XVHFHOOXORVHDVDQHQHUJ\VRXUFHEHFDXVHRIWKHODFNRIȕJO\FRVLGDVHZKLFKFDWDO\]HVWKH
K\GURO\VLV RI ȕJO\FRVLGLF ERQGV QRWH WKDW PDPPDOV KDYH ĮJO\FRVLGDVH WKDW FDWDO\]HV WKH
K\GURO\VLV RI JO\FRJHQ DQG VWDUFK  &HOOXORVH FDQ DOVR EH SURGXFHG E\ EDFWHULD %DFWHULDO
FHOOXORVHKDVEHHQRIWHQXVHGIRUWLVVXHHQJLQHHULQJDQGZLOOEHWKHIRFXVKHUH

6HYHUDO W\SHV RI PLFURRUJDQLVP LQFOXGLQJ DOJDH 9DOORQLD  IXQJL 6DSUROHJQLD
'LFW\VWHOLXP GLVFRLGHXP  DQG EDFWHULD $FHWREDFWHU $FKURPREDFWHU $HUREDFWHU
$JUREDFWHULXP 3VHXGRPRQDV 5KL]RELXP 6DUFLQD $OFDOLJHQHV =RRJORHD  FDQ V\QWKHVL]H
FHOOXORVH $PRQJ WKHVH PLFURRUJDQLVPV WKH EDFWHULXP $FHWREDFWHU [\OLQXP ZKLFK LV
XVXDOO\ IRXQG LQ IUXLWV YHJHWDEOHV DQG DOFRKROLF EHYHUDJHV KDV EHHQ XVHG WR JHQHUDWH
FHOOXORVHIRUWLVVXHHQJLQHHULQJDSSOLFDWLRQV,QDFXOWXUHPHGLXPWKLVEDFWHULXPFDQSURGXFH
D QHWZRUN RI FHOOXORVH ILEUHV 7KH FHOOXORVH ILEUHV FDQ EH FROOHFWHG IDEULFDWHG LQWR GHVLUHG
IRUPV DQG XVHG WR FRQVWUXFW VFDIIROGV IRU WLVVXH HQJLQHHULQJ DSSOLFDWLRQV 7KH EDFWHULDO

ϭϰϱ

FHOOXORVH V\QWKHVL]HG E\ $FHWREDFWHU [\OLQXP LV VLPLODU WR WKH SODQW FHOOXORVH LQ PROHFXODU
FRPSRVLWLRQ%RWKW\SHVRIFHOOXORVHFRQWDLQGJOXFRVH+RZHYHUEDFWHULDOFHOOXORVHH[KLELWV
D KLJKHU FU\VWDOOLQLW\ KLJKHU ZDWHU DEVRUSWLRQ FDSDFLW\ RU ORZHU K\GURSKRELFLW\ KLJKHU
PHFKDQLFDO VWUHQJWK DQG ILQHU PROHFXODU DUUDQJHPHQW FRPSDUHG WR WKH SODQW FHOOXORVH
&HOOXORVH DQG LWV GHULYDWLYHV VXFK DV FHOOXORVH QLWUDWH FHOOXORVH DFHWDWH DQG FHOOXORVH
[DQWKDWHFDQEHHDVLO\IDEULFDWHGLQWRGHVLUHGIRUPV8QOLNHRWKHU SRO\VDFFKDULGHV VXFKDV
JO\FRJHQ DQG VWDUFK FHOOXORVH H[KLELWV ORZ ZDWHU VROXELOLW\ DQG WKHUHIRUH D ORZ UDWH RI
GHJUDGDWLRQ ZKHQ LPSODQWHG LQWR DQ DQLPDO WLVVXH $ GHFUHDVH LQ WKH FU\VWDOOLQLW\ DQG
K\GURSKRELFLW\RIFHOOXORVHXVXDOO\UHVXOWVLQDQLQFUHDVHLQWKHELRGHJUDGDELOLW\RIFHOOXORVH
*LYHQWKHFKHPLFDOFRPSRVLWLRQEDFWHULDOFHOOXORVHLVKLJKO\ELRFRPSDWLEOHDQGQRQWR[LFWR
WKHKRVW)XUWKHUPRUHEDFWHULDOFHOOXORVHLVDKLJKO\PRXOGDEOHPDWHULDODQGFDQEHXVHGWR
IDEULFDWHVFDIIROGVZLWKGHVLUHGIRUPV&HOOXORVHEDVHGPDWHULDOVKDYHEHHQXVHGLQDQXPEHU
RI ELRPHGLFDO DSSOLFDWLRQV 7KHVH LQFOXGH FRQVWUXFWLRQ RI FHOOXORVH PHPEUDQHV IRU
KHPRGLDO\VLVFRQVWUXFWLRQRIHQ]\PHFDUULHUVIRUELRVHQVRUVGUXJGHOLYHU\FRQVWUXFWLRQRI
VFDIIROGVIRUWKHUHJHQHUDWLRQRIYDULRXVWLVVXHW\SHVVXFKDVWKHERQHFDUWLODJHOLYHUVNLQ
DQGEORRGYHVVHOV7KHVHLQYHVWLJDWLRQV KDYH FRQVLVWHQWO\ GHPRQVWUDWHGWKDW FHOOXORVHEDVHG
PDWHULDOVHOLFLWOLWWOHLQIODPPDWRU\DQGWR[LFUHDFWLRQV&HOOXORVHKDVEHHQSURYHQDSURPLVLQJ
PDWHULDOIRUWKHFRQVWUXFWLRQRIWLVVXHUHJHQHUDWLQJVFDIIROGV

$OJLQDWHV

$OJLQDWHV DUHOLQHDU SRO\VDFFKDULGHV FRPSRVHG RI ȕPDQQXURQLF DFLG DQGĮJXOXURQLF
DFLG $OJLQDWHV DUH IRXQG LQ EURZQ VHDZHHG DQG LQ FHUWDLQ EDFWHULD 7KH FRQWHQW RI ȕ
PDQQXURQLFDFLGDQGĮJXOXURQLFDFLGPD\YDU\GHSHQGLQJRQWKHSODQWRUEDFWHULDOVSHFLHV
IURP ZKLFK DOJLQDWHV DUH REWDLQHG $OJLQDWHV FDQ EH XVHG WR IRUP K\GURJHO DQG PDWUL[
'LYDOHQWFDWLRQVVXFKDV&DDQG0QFDQLQLWLDWHDOJLQDWHJHODWLRQE\OLQNLQJĮJXOXURQLF
DFLG XQLWV EHWZHHQ GLIIHUHQW SRO\PHU FKDLQV 7KH IHDWXUH RI JHODWLRQ UHQGHUV DOJLQDWHV D
SRWHQWLDOPDWHULDOIRUWLVVXHHQJLQHHULQJDSSOLFDWLRQVVXFKDVFHOOVHHGLQJDQGWUDQVSODQWDWLRQ
WLVVXH UHSDLU DQG GUXJ GHOLYHU\ $OJLQDWH JHOV ZLWK YDULRXV PHFKDQLFDO SURSHUWLHV FDQ EH
JHQHUDWHG XQGHU GLIIHUHQW JHOOLQJ FRQGLWLRQV DQG E\ XVLQJ GLIIHUHQW FURVVOLQNHUV 1XPHURXV
VWXGLHV KDYH EHHQ FRQGXFWHG WR WHVW WKH HODVWLF DQG VKHDULQJ PHFKDQLFDO SURSHUWLHV 8QGHU
FRPSUHVVLYH IRUFHV DOJLQDWH PDWULFHV H[KLELW HODVWLF PRGXOXV UDQJLQJ IURP  WR  N3D
GHSHQGLQJ RQJHOOLQJ DQG H[SHULPHQWDOFRQGLWLRQV 6LPLODUO\ WKHVKHDUPRGXOXVRIDOJLQDWH
PDWULFHVVSUHDGVZLGHO\IURPWRN3DXQGHUGLIIHUHQWH[SHULPHQWDOFRQGLWLRQV8QGHU
WHQVLOHIRUFHVWKHPD[LPDOWHQVLOHVWUHQJWKRUIDLOXUHVWUHVVRIDOJLQDWHJHOVUDQJHVIURPWR
N3DDQGWKHPD[LPDORUIDLOXUHVWUDLQLVIURPWRGHSHQGLQJRQWKHFRPSRVLWLRQRI
DOJLQDWHVDQGWKHVWUDLQUDWHDSSOLHG$OJLQDWHJHOVFURVVOLQNHGE\&DKDYHEHHQXVHGIRUD
QXPEHU RI ELRPHGLFDO DSSOLFDWLRQV 2QH RI WKH DSSOLFDWLRQV LV DOJLQDWHPHGLDWHG JHQH
GHOLYHU\$OJLQDWHPLFURVSKHUHVKDYHEHHQIDEULFDWHGWRFDUU\JHQHVRILQWHUHVW7KHDOJLQDWH
PLFURVSKHUHV FDQ EH GHOLYHUHG WR WDUJHW WLVVXHV ZKHUH WKH JHQH LV UHOHDVHG %HFDXVH RI WKH
ELRGHJUDGDELOLW\RIDOJLQDWHVJHQHVFDQEHUHOHDVHGLQDFRQWUROOHGPDQQHUZLWKWKHUHOHDVLQJ
UDWHGHSHQGLQJRQWKHUDWHRIDOJLQDWHGHJUDGDWLRQ6LPLODUO\DQDOJLQDWHEDVHGJHORUPDWUL[
FDQ EH XVHG WR PHGLDWH FRQWUROOHG SURWHLQ DQG GUXJ GHOLYHU\ ,Q DGGLWLRQ DOJLQDWHEDVHG
PDWHULDOVKDYHEHHQIDEULFDWHGDQGXVHGWRPHGLDWHZRXQGKHDOLQJ$OJLQDWHVFDQIRUPDWKLQ
OD\HURIJHOZKHQFURVVOLQNHGE\&D6XFKDJHOOD\HUFDQEHXVHGWRFRYHUVNLQZRXQGWR
SUHYHQWWKHORVVRIERG\IOXLGVDQGEDFWHULDOLQIHFWLRQ$OJLQDWHEDVHGPDWHULDOVFDQEHXVHG
WRFRQVWUXFWYDULRXVIRUPVRIPDWUL[VFDIIROGVIRUWKHUHSDLURUUHJHQHUDWLRQRIYDULRXVWLVVXH
W\SHV VXFK DV WKH FDUWLODJH OLYHU DQG ERQH $OJLQDWH PDWHULDOV KDYH DOVR EHHQ XVHG WR
FRQVWUXFWFDSVXOHVIRUFHOOWUDQVSODQWDWLRQ&HOOVFDQEHHQFDSVXODWHGZLWKLQDOJLQDWHFDSVXOHV

ϭϰϲ

DQGGHOLYHUHGWRWDUJHWWLVVXHV )LJ 7KHDOJLQDWHFDSVXOHVFDQSDUWLDOO\SURWHFWWKHHQFORVHG
FHOOVIURPLQIODPPDWLRQLQGXFHGLQMXU\

&KLWRVDQ

&KLWRVDQLVDOLQHDUSRO\VDFFKDULGHFRPSRVHGRIGJOXFRVDPLQHXQLWVMRLQWHGE\ȕ
JO\FRVLGLF ERQGV ZLWK UDQGRPO\ LQVHUWHG 1DFHW\OJOXFRVDPLQH XQLWV &KLWRVDQ LV D SDUWLDOO\
GHDFHW\ODWHG GHULYDWLYH RI FKLWLQ ZKLFK LV D FRSRO\PHU RI UDQGRPO\ GLVWULEXWHG 1
DFHW\OJOXFRVDPLQH DQG 1JOXFRVDPLQH XQLWV $ SRO\PHU PROHFXOH ZLWK PRUH WKDQ  1
DFHW\OJOXFRVDPLQH XQLWV LV NQRZQ DV FKLWLQ DQG WKDW ZLWK PRUH WKDQ  1JOXFRVDPLQH
XQLWVLVFDOOHGFKLWRVDQ&KLWRVDQDQGFKLWLQDUHIRXQGLQWKHVKHOORIFUDEVDQGVKULPSVDQG
DUHVLPLODUWRFHOOXORVHLQVWUXFWXUH&KLWRVDQDQGFKLWLQFDQEHFROOHFWHGIURPWKHVHVKHOOILVK
VRXUFHV&KLWRVDQLVDVHPLFU\VWDOOLQHPROHFXOHDQGLVXVXDOO\VWDEOH,WLVLQVROXEOHLQZDWHU
EXW VROXEOH LQ DFLGLF VROXWLRQV S+ ‫  ׽‬7KH XVH RI FKLWRVDQ IRU WLVVXH HQJLQHHULQJ UHOLHV
SDUWLDOO\RQLWVJHODWLRQDELOLW\&KLWRVDQVROXWLRQVFDQEHJHOOHGLQPHWKDQRODQGXQGHUDKLJK
S+ FRQGLWLRQ $ GULHG FKLWRVDQ VWUXFWXUH FDQ EH PHFKDQLFDOO\ YHU\ VWURQJ &KLWRVDQ
PROHFXOHV DUH XVXDOO\ SRVLWLYHO\ FKDUJHG DQGFDQ ELQG WR PROHFXOHV ZLWK QHJDWLYH FKDUJHV
VXFK DV JO\FRVDPLQRJO\FDQV DQG DOJLQDWHV $ XQLTXH IHDWXUH LV WKDW WKH FKDUJH GHQVLW\ RI
FKLWRVDQ LV GHSHQGHQW RQ S+ 6XFK D IHDWXUH UHQGHUV FKLWRVDQ D FDQGLGDWH PDWHULDO IRU S+
FRQWUROOHG GUXJ GHOLYHU\ :KHQ LPSODQWHG LQ YLYR FKLWRVDQ LV GHJUDGHG E\ O\VR]\PH
FDWDO\]HG K\GURO\VLV &KLWRVDQ LV GLVLQWHJUDWHG LQWR ROLJRVDFFKDULGHV 7KH UDWH RI FKLWRVDQ
GHJUDGDWLRQ LV LQYHUVHO\ SURSRUWLRQDO WR WKH GHJUHH RI FU\VWDOOLQLW\ 7KH FU\VWDOOL]DWLRQ RI
FKLWRVDQ LV UHJXODWHG E\ GHDFHW\ODWLRQ &KLWRVDQ PROHFXOHV ZLWK LQFUHDVHG GHDFHW\ODWLRQ RQ
WKH 1DFHW\OJOXFRVDPLQH XQLWV H[KLELW LQFUHDVHG FU\VWDOOLQLW\ DQG UHGXFHG GHJUDGDWLRQ ,Q D
KLJKO\FU\VWDOIRUPLWWDNHVVHYHUDOPRQWKVWRGHJUDGHFKLWRVDQVFDIIROGVLQYLYR$PRUSKRXV
FKLWRVDQH[KLELWVPRUHUDSLGGHJUDGDWLRQ&KLWRVDQLVDSRO\VDFFKDULGHWKDWFDQEHIDEULFDWHG
LQWRYDULRXVIRUPVRISRURXVPDWUL[7RSURGXFHDFKLWRVDQPDWUL[FKLWRVDQFDQEHGLVVROYHG
LQ DFHWLF DFLG 7KH FKLWRVDQ±DFHWLF DFLG VROXWLRQ FDQ EH IUR]HQ DQG O\RSKLOL]HG WR SURGXFH
FKLWRVDQ PDWUL[ 7KH IUHH]LQJ SURFHVV LQGXFHV WKH IRUPDWLRQ RI LFH FU\VWDOV 7KH IROORZLQJ
O\RSKLOL]LQJSURFHVVUHPRYHVWKHLFHFU\VWDOVDOORZLQJWKHIRUPDWLRQRIDSRURXVPDWUL[7KH
VL]HRIWKHSRUHVFDQEHFRQWUROOHGE\DOWHULQJWKHUDWHRILFHFU\VWDOIRUPDWLRQ&KLWRVDQFDQ
EH XVHG WR PDNH PDWHULDOV ZLWK YDULRXV PHFKDQLFDO SURSHUWLHV $ SXUH FKLWRVDQ PDWHULDO
ZLWKRXW DSSDUHQW SRUHV H[KLELWV HODVWLF PRGXOXV UDQJLQJ IURP  WR  03D +RZHYHU WKH
LQWURGXFWLRQRISRUHV UHGXFHV WKHHODVWLF PRGXOXV DQGPHFKDQLFDOVWUHQJWK3RURXVFKLWRVDQ
PDWHULDOV FRXOG KDYH DQ HODVWLF PRGXOXV DV ORZ DV  03D 7KH IDLOXUH VWUDLQ RU PD[LPDO
VWUDLQ RI FKLWRVDQ LV DOVR GHSHQGHQW RQ WKH SRURVLW\ RI WKH PDWHULDO 1RQSRURXV FKLWRVDQ
PDWHULDOVFDQ EHVWUHWFKHG WR D VWUDLQDERXW  ZKHUHDV D SRURXV FKLWRVDQ PDWHULDO FDQ EH
VWUHWFKHGWRDVWUDLQDERXW3RURXVFKLWRVDQH[KLELWVDQRQOLQHDUPHFKDQLFDOEHKDYLRXULH
WKH PHFKDQLFDO EHKDYLRU LV GHSHQGHQW RQ WKH OHYHO RI VWUDLQ DQG VWUHVV 7KH PDWHULDO JDLQV
VWLIIQHVV ZLWKLQFUHDVHGHODVWLFPRGXOXV ZKHQVWUDLQDQGVWUHVVDUHHOHYDWHG



ϭϰϳ

 
)LJXUH  &HOOFRQWDLQLQJ DOJLQDWH EHDGV IRU FHOO WUDQVSODQWDWLRQ &HOOV ZHUH HQFDSVXODWHG
ZLWK DOJLQDWH EHDGV E\ GURSSLQJ WKH FHOO±DOJLQDWH PL[WXUH LQWR DQ DJLWDWHG EDWK RI FDOFLXP
FKORULGHXVLQJDV\ULQJH $ $ORZPDJQLILFDWLRQLPDJHRIWKHEHDGV % $KLJKHUPDJQLIL
FDWLRQLPDJH & &HOO±DOJLQDWHEHDGVZHUHPL[HGLQWRDFDOFLXPSKRVSKDWHFHPHQWSDVWHDWD
YROXPHIUDFWLRQRIDOJLQDWHEHDGV

ϭϰϴ

 &KHPLFDO PRGLILFDWLRQV VLJQLILFDQWO\ LQIOXHQFH WKH PHFKDQLFDO SURSHUWLHV RI FKLWRVDQ
PDWHULDOV)RULQVWDQFHWKHFRDWLQJRIDFKLWRVDQPDWHULDOZLWKK\DOXURQLFDFLGVLJQLILFDQWO\
LQFUHDVHVWKHWHQVLOHVWUHQJWKRIWKHFKLWRVDQPDWHULDO7KLVPHFKDQLFDOUHLQIRUFHPHQWLVGXH
WRWKHIRUPDWLRQRIWLJKWERQGVEHWZHHQSRVLWLYHO\FKDUJHGFKLWRVDQPROHFXOHVDQGQHJDWLYHO\
FKDUJHG K\DOXURQLF DFLG PROHFXOHV 6XFK UHLQIRUFHG FKLWRVDQ PDWHULDOV DUH VXLWDEOH IRU
UHSDLULQJWLVVXHVZLWKKLJKPHFKDQLFDOORDGVVXFKDVFDUWLODJH)XUWKHUPRUHWKHLQFRUSRUDWLRQ
RIK\GUR[\DSDWLWHRURWKHUFDOFLXPFRQWDLQLQJPDWHULDOVLQWRFKLWRVDQRUFKLWLQFDQJHQHUDWH
FRPSRVLWHPDWHULDOVZLWKLQFUHDVHGPHFKDQLFDOVWUHQJWK6XFKPDWHULDOVFDQEHXVHGIRUERQH
UHSDLU RU UHJHQHUDWLRQ *LYHQ WKH PROHFXODU VWUXFWXUH PHFKDQLFDO SURSHUWLHV
ELRFRPSDWLELOLW\ DQG WKH FDSDELOLW\ RI IRUPLQJ YDULRXV PDWUL[ VWUXFWXUHV FKLWRVDQ DQG
FKLWRVDQ GHULYDWLYHV KDYH EHHQ FRQVLGHUHG FDQGLGDWH PDWHULDOV IRU WKH HQJLQHHULQJ DQG
UHJHQHUDWLRQ RI LQMXUHG WLVVXHV DQG RUJDQV &KLWRVDQ PDWHULDOV KDYH EHHQ XVHG WR FRQVWUXFW
PDWUL[ VFDIIROGV IRU VHHGLQJ FXOWXULQJ DQG WUDQVSODQWLQJ FHOOV LQWR WDUJHW WLVVXHV 7KHVH
PDWHULDOVKDYHDOVREHHQXVHGDVFDUULHUVIRUGUXJGHOLYHU\6HYHUDOVWXGLHVKDYHVKRZQWKDW
FKLWRVDQFDQVHUYHDVDJHQHWUDQVIHUFDUULHU*HQHVPL[HGZLWKFKLWRVDQEDVHGPDWHULDOVKDYH
EHHQ VXFFHVVIXOO\ GHOLYHUHG WR WDUJHW FHOOV LQ WKH NQHH MRLQWV LQ DQLPDO PRGHOV &KLWRVDQ
PHGLDWHGJHQH WUDQVIHUFDQ DOVR EHFDUULHG RXW WRJHWKHUZLWKFHOO WUDQVSODQWDWLRQHQKDQFLQJ
WKHUDSHXWLFHIIHFWVRQWDUJHWGLVHDVHV

1XPHURXVLQYHVWLJDWLRQVKDYHVKRZQFRQVLVWHQWO\WKDWFKLWRVDQDQGFKLWRVDQGHULYDWLYHV
DUH UHODWLYHO\ QRQWR[LF DQG ELRFRPSDWLEOH ,Q SDUWLFXODU FKLWRVDQEDVHG PDWHULDOV GR QRW
LQGXFHVLJQLILFDQWILEURXVHQFDSVXODWLRQDURXQGWKHLPSODQWV$OWKRXJKFKLWRVDQLPSODQWDWLRQ
LQGXFHV OHXNRF\WH LQILOWUDWLRQ GXULQJ WKH HDUO\ SHULRG ZLWKLQ GD\V  FKURQLF LQIODPPDWLRQ
GRHVQRWRFFXUVLJQLILFDQWO\7KHDSSOLFDWLRQRIFKLWRVDQWRFDUWLODJHUHSDLUDQGUHJHQHUDWLRQ
KDV GHPRQVWUDWHG D EHQHILFLDO HIIHFW RQ WKH UHFRYHU\ RI LQMXUHG FDUWLODJH WLVVXHV VXFK DV
VWLPXODWLRQRIFKRQGURF\WHJURZWKDQGH[SUHVVLRQRIVWUXFWXUDOSURWHLQV7KHVHREVHUYDWLRQV
KDYHGHPRQVWUDWHGWKHIHDVLELOLW\RIXVLQJFKLWRVDQDQGFKLWRVDQGHULYDWLYHV DV ELRPDWHULDOV
IRUWLVVXHUHJHQHUDWLYHHQJLQHHULQJ

6WDUFK

6WDUFK LV FRPSRVHG RI GJOXFRVH DQG LV D IRUP RI SRO\VDFFKDULGH IRU WKH VWRUDJH RI
HQHUJ\LQSODQWV,WFDQEHIRXQGLQDOOSODQWVHHGVDQGWXEHUV7KHUHDUHWZRIRUPVRIVWDUFK
DP\ODVHDQGDP\ORSHFWLQ$P\ORVHLVDOLQHDUSRO\PHUZLWKWKHGJOXFRVHXQLWVMRLQHGE\WKH
ĮJO\FRVLGLFERQGVZKHUHDVDP\ORSHFWLQFRQWDLQVEUDQFKLQJSRO\PHUFKDLQVLQZKLFKWKH
GJOXFRVH XQLWV DUH MRLQHG E\ WKH ĮJO\FRVLGLF ERQGV LQ WKH OLQHDU SRUWLRQ DQG WKRVH DW
EUDQFKLQJSRLQWVDUHMRLQHGE\WKHĮJO\FRVLGLFERQGV

&RUQ VWDUFK LV XVXDOO\ XVHG LQ ELRPHGLFDO UHVHDUFK 6WDUFK FDQ EH EOHQGHG ZLWK
FKHPLFDO FRPSRXQGVVXFK DV HWK\OHQH YLQ\O DOFRKRO DQGFHOOXORVHDFHWDWHWRPDNHPDWULFHV
WKDW FDQ VHUYH DV HQJLQHHULQJ VFDIIROGV RU FHOO VHHGLQJFXOWXUH VXEVWUDWHV 7KH IDEULFDWHG
PDWUL[ FDQ EH UHLQIRUFHG E\ PL[LQJ ZLWK K\GUR[\DSDWLWH WR IRUP D FRPSRVLWH PDWHULDO
3RO\PHU PDWULFHV RI YDULRXV IRUPV FDQ EH SUHSDUHG E\ LQMHFWLRQ PROGLQJ 6WDUFK DQG LWV
FRPSRVLWHVKDYHEHHQXVHGDVVXEVWUDWHVIRUFHOOFXOWXUHDQGFDUULHUVIRUFHOOWUDQVSODQWDWLRQ
6WDUFK EDVHG PDWHULDOV GR QRW VLJQLILFDQWO\ LQIOXHQFH WKH JURZWK DQG IXQFWLRQ RI FXOWXUHG
FHOOV 7KHVH PDWHULDOV KDYH DOVR EHHQ XVHG LQ YLYR IRU VHYHUDO ELRPHGLFDO DSSOLFDWLRQV
LQFOXGLQJ GUXJ GHOLYHU\ DQG WLVVXH UHSDLU DQG UHJHQHUDWLRQ :KLOH VWDUFK PD\ QRW EH
PHFKDQLFDOO\VWURQJWKHDGGLWLRQRIUHLQIRUFHPHQWFRPSRXQGVPD\HQKDQFHWKHPHFKDQLFDO
VWUHQJWK $V VWDUFK LV FRPSRVHG RI QDWXUDO GJOXFRVH VWDUFKEDVHG PDWHULDOV DUH XVXDOO\

ϭϰϵ

QRQWR[LF DQG ELRFRPSDWLEOH 6XFK IHDWXUHV UHQGHU VWDUFK D SURPLVLQJ PDWHULDO IRU WLVVXH
UHJHQHUDWLYHHQJLQHHULQJ

*O\FRVDPLQRJO\FDQV

*O\FRVDPLQRJO\FDQV *$*V  DUH OLQHDU SRO\VDFFKDULGHV FRPSRVHG RI UHSHDWHG
GLVDFFKDULGHXQLWV(DFKXQLWFRQWDLQVDQXURQLFDFLGDQGDPLQRVXJDUPROHFXOH$FFRUGLQJWR
WKH W\SH RI WKH GLVDFFKDULGH XQLW *$*V FDQ EH FODVVLILHG LQWR VHYHUDO JURXSV LQFOXGLQJ
FKRQGURLWLQ VXOSKDWH K\DOXURQDWH NHUDWLQ VXOSKDWH DQG KHSDULQ VXOSKDWH $ FKRQGURLWLQ
VXOSKDWHPROHFXOHLVFRPSRVHGRIDJOXFXURQLFDFLGDQGDQ1DFHW\OJDODFWRVDPLQHXQLWZLWKD
62 JURXSRQWKHRUFDUERQSRVLWLRQV$K\DOXURQDWHPROHFXOHFRQWDLQVDJOXFXURQLFDFLG
DQGDQ1DFHW\OJOXFRVDPLQHXQLW$NHUDWLQVXOSKDWHPROHFXOHFRQWDLQVDJDODFWRVHDQGDQ1
DFHW\OJOXFRVDPLQH XQLW ZLWK D 62 RQ FDUERQ SRVLWLRQ  $ KHSDULQ VXOSKDWH PROHFXOH
FRQWDLQVDGJOXFXURQLFDFLGDQGDQ1DFHW\OGJOXFRVDPLQHXQLW

*O\FRVDPLQRJO\FDQV DUH IRXQG LQ PDPPDOLDQ FRQQHFWLYH WLVVXHV VXFK DV WKH
VXEFXWDQHRXVWLVVXHFDUWLODJHDQGEORRGYHVVHOV7KHVHPROHFXOHVDWWDFKWRFRUHSURWHLQVDQG
IRUP SURWHRJO\FDQV PDMRU H[WUDFHOOXODU PDWUL[ PROHFXOHV NQRZQ DV JURXQG VXEVWDQFHV
+HSDULQ VXOSKDWH LV IRXQG RQ WKH VXUIDFH RI YDVFXODU HQGRWKHOLDO FHOOV DQG LV VLPLODU LQ
VWUXFWXUH DQGIXQFWLRQ WR KHSDULQ ZKLFKLV DSRWHQW DQWLFRDJXODQW *O\FRVDPLQRJO\FDQV DUH
FKDUDFWHUL]HGE\VHYHUDOJHQHUDOIHDWXUHVLQFOXGLQJWKHSUHVHQFHRIDKLJKGHQVLW\RIQHJDWLYH
FKDUJHV KLJK K\GURSKLOLFLW\ DQG ZDWHU VROXELOLW\ DQG ORZ FU\VWDOOLQLW\ +RZHYHU WKHUH DUH
GLIIHUHQFHV LQ PDWHULDO SURSHUWLHV EHWZHHQ YDULRXV *$*V PROHFXOHV )RU LQVWDQFH
K\DOXURQDWH LV D ODUJH PROHFXOH DQG KDV D KLJK JHOIRUPLQJ FDSDELOLW\ 7KHVH PROHFXOHV
DEVRUEDODUJHDPRXQWRIZDWHUFRQVWLWXWLQJDPDMRUSDUWRIWKHH[WUDFHOOXODUPDWUL[%HFDXVH
RI WKH JHOIRUPLQJ FDSDELOLW\ K\DOXURQDWH LV RIWHQ XVHG DV D PHGLD IRU GUXJGHOLYHU\ RU D
PDWHULDOIRUWLVVXHUHSDLUDQGUHJHQHUDWLRQ7KHFRPSRVLWLRQRIK\DOXURQDWHPD\EHPRGLILHG
WR FRQVWUXFW PDWHULDOV ZLWK YDULRXV SURSHUWLHV )RU H[DPSOH SDUWLDO HVWHULILFDWLRQ RI WKH
FDUER[\O JURXSV RI K\DOXURQDWH PROHFXOHV UHGXFHV WKH ZDWHU VROXELOLW\ RI WKH SRO\PHU DQG
LQFUHDVHVLWVYLVFRVLW\([WHQVLYHHVWHULILFDWLRQJHQHUDWHVPDWHULDOVWKDWIRUPZDWHULQVROXEOH
ILOPV RU JHOV 7KXV K\DOXURQDWH JHOV ZLWK GHVLUHG SURSHUWLHV FDQ EH SUHSDUHG E\ DOWHULQJ
FKHPLFDO FRPSRVLWLRQV &RPSDUHG WR K\DOXURQDWH RWKHU W\SHV RI *$*V H[KLELW SRRU JHO
IRUPLQJ FDSDELOLW\ LQ YLWUR 7KHVH *$*V DORQH KDYH QRW EHHQ XVHG H[WHQVLYHO\ DV
ELRPDWHULDOV +RZHYHU QHJDWLYHO\ FKDUJHG *$*V FDQ ELQG WLJKWO\ WR SRVLWLYHO\ FKDUJHG
PROHFXOHV VXFK DV FKLWLQ DQG FKLWRVDQ DQG IRUP FRPSRVLWH SRO\PHULF PDWHULDOV 6XFK
FRPSRVLWHPDWHULDOVFDQEHXVHGWRIRUPJHOVZLWKYDULRXVPDWHULDOSURSHUWLHVE\DOWHULQJWKH
UHODWLYH FRQWHQWV RI *$* DQGRU FKLWRVDQ *O\FRVDPLQRJO\FDQV DQG JO\FRVDPLQRJO\FDQ
EDVHG FRPSRVLWH SRO\PHUV KDYH EHHQ XVHG WR FRQVWUXFW K\GURJHOV DQG PDWULFHV IRU YDULRXV
ELRPHGLFDODSSOLFDWLRQVVXFKDVGUXJGHOLYHU\FHOOVHHGLQJDQGWUDQVSODQWDWLRQWLVVXHUHSDLU
DQG WLVVXH UHJHQHUDWLRQ 6LQFH *$*V DUH QDWXUDO PROHFXOHV WKH\ DUH ELRFRPSDWLEOH DQG GR
QRWFDXVHVLJQLILFDQWWR[LFDQGLQIODPPDWRU\UHDFWLRQV7KHVHPROHFXOHVFDQEHGHJUDGHGDW
GLIIHUHQW UDWHV GHSHQGLQJ RQ WKH FRPSRVLWLRQV RI WKH PDWHULDOV )RU IXOO\ HVWHULILHG
K\DOXURQDWHPHPEUDQHVWKHOLIHWLPHLVVHYHUDOPRQWKV$UHGXFWLRQLQHVWHULILFDWLRQLQFUHDVHV
WKHUDWHRIGHJUDGDWLRQ

0HWDOOLFPDWHULDOVDV%LRPDWHULDOV

6HYHUDO W\SHV RIPHWDOOLFPDWHULDO KDYH EHHQ XVHG DVELRPDWHULDOV7KHVHLQFOXGHLURQ
)H FKURPLXP &U FREDOW &R QLFNHO 1L WLWDQLXP 7L PRO\EGHQXP 0R DQGWXQJVWHQ
: 7KHVHPDWHULDOVKDYHDOVREHHQXVHGWRFUHDWHDOOR\VSURYLGLQJIDYRUDEOHSURSHUWLHVIRU

ϭϱϬ

WKHIDEULFDWLRQDQG SHUIRUPDQFH RI ELRPDWHULDOV7\SLFDOH[DPSOHV RIDOOR\VLQFOXGH&R±&U
DQG 7L DOOR\V ,Q DGGLWLRQ VWDLQOHVV VWHHOV KDYH EHHQ GHYHORSHG DQG XVHG DV ELRPDWHULDOV
%HFDXVHRIWKHLUVXSHULRUVWUHQJWKHODVWLFLW\DQGHQGXUDQFHPHWDOOLFPDWHULDOVDUHRIWHQXVHG
IRUWKHUHSDLUDQGUHSODFHPHQWRIERQHVDQGMRLQWV)RUWKHSDVWVHYHUDOGHFDGHVWKHVHDOOR\V
KDYHEHHQZHOODFFHSWHGIRUWKHLUSHUIRUPDQFHELRFRPSDWLELOLW\DQGVWDELOLW\

6WDLQOHVV6WHHOVDV%LRPDWHULDOV

6WHHOV DUH DUWLILFLDOO\ PRGLILHG IRUPV RI LURQ ZLWK YDULRXV FDUERQ FRQWHQWV DQG DUH
FKDUDFWHUL]HG E\ PHFKDQLFDO KDUGQHVV HODVWLFLW\ DQG VWUHQJWK 7KXV VWHHOV DUH FRQVLGHUHG
FDQGLGDWHPDWHULDOVIRUWKHUHSDLURIWKHVNHOHWDOV\VWHP7KHPHFKDQLFDOIHDWXUHVRIVWHHOVDUH
GHSHQGHQW RQ WKH FRQWHQW RI FDUERQ DQG WHPSHUDWXUH 7KH FU\VWDO VWUXFWXUH RI LURQ ZKLFK
GHWHUPLQHVWKHPHFKDQLFDOFKDUDFWHULVWLFVRILURQFDQEHPRGXODWHGE\DOWHULQJWKHWUHDWPHQW
WHPSHUDWXUHDQGFDUERQFRQFHQWUDWLRQ$WDUHODWLYHO\FROGWHPSHUDWXUHVD\ž&LURQDWRPV
DUH RUJDQL]HG LQWR D XQLW VWUXFWXUH ZLWK D ERG\FHQWHUHG FXELF IRUP ,Q HDFK XQLW HLJKW
QHLJKERULQJDWRPVDUHV\PPHWULFDOO\ORFDOL]HGWRWKHFRUQHUVRIDQLPDJLQDU\FXEHZLWKRQH
DWRP DW WKH FXEH FHQWHU $Q LQFUHDVH LQ WHPSHUDWXUH WR D FHUWDLQ GHJUHH FDQ LQGXFH D
WUDQVIRUPDWLRQRIWKHDWRPLFVWUXFWXUHIURPWKHERG\FHQWHUHGFXELFIRUPLQWRDXQLWVWUXFWXUH
ZLWKDIDFHFHQWHUHGFXELFIRUPLQZKLFKWKHDWRPVDUHORFDOL]HGWRWKHIDFHVRIDQLPDJLQDU\
FXEH&DUERQDWRPVFDQEHLQWHJUDWHGPRUHHDVLO\LQWRWKHLURQXQLWVWUXFWXUHZLWKWKHIDFH
FHQWHUHG FXELF IRUP WKDQ WKDW ZLWK WKH ERG\FHQWHUHG FXELF IRUP 7KXV DQ DSSURSULDWH
DOWHUDWLRQLQWHPSHUDWXUHIDFLOLWDWHVWKHLQWHJUDWLRQRIFDUERQLQWRWKHLURQ&DUERQLQWHJUDWLRQ
HQKDQFHVWKHVWDELOLW\KDUGQHVVDQGVWUHQJWKRIWKHLURQ+RZHYHUWKHVROXELOLW\RIFDUERQLQ
LURQLVUHODWLYHO\ORZ$QH[FHVVLYHOHYHORIFDUERQLQGXFHVFDUERQSUHFLSLWDWLRQDSUREOHP
LQIOXHQFLQJ WKH HQGXUDQFH DQG PHFKDQLFDO SURSHUWLHV RI WKH VWHHO $Q DSSURSULDWH
FRQFHQWUDWLRQRIFDUERQLVDERXW$FRPPRQSUREOHPIRUXVLQJVWHHOVDVELRPDWHULDOV
LV FRUURVLRQ 7R UHVROYHVXFK D SUREOHPFKURPLXP KDV EHHQ DGGHG WR VWHHOV UHQGHULQJ WKH
VWHHOVVWDLQOHVV)RUWKHPDQXIDFWXULQJ RIELRPDWHULDOVFKURPLXPLVXVHGDWDFRQFHQWUDWLRQ
UDQJLQJIURPWR+RZHYHUWKHXVHRIFKURPLXPLQWURGXFHVDSUREOHPWKHPL[LQJRI
FKURPLXPDQGFDUERQFDQIRUPFDUELGHVZKLFKHQKDQFHVFDUERQSUHFLSLWDWLRQ$QDSSURDFK
XVHGWRPLWLJDWLQJFDUELGHIRUPDWLRQLVWRDGGQLFNHOWRWKHVWHHO1LFNHOFDQVWDELOL]HWKHLURQ
VWUXFWXUH SUHYHQW FDUELGH IRUPDWLRQ DQG HQKDQFH FRUURVLRQ UHVLVWDQFH 1LFNHO LV XVHG DW D
FRQFHQWUDWLRQRI±LQVWHHOVDVELRPDWHULDOV7KHFKURPLXP±QLFNHOVWDLQOHVVVWHHOKDVD
KLJK \LHOGLQJ VWUHQJWK ! 03D  DQG LV FRQVLGHUDEO\ FRUURVLRQUHVLVWDQW +RZHYHU
FRUURVLRQFDQVWLOORFFXUZKHQVWHHOPDWHULDOVDUHLPSODQWHGLQWRWKHERG\7KXVWKLVPDWHULDO
LVRIWHQXVHGWRIDEULFDWHWHPSRUDU\LPSODQWVVXFKDVIUDFWXUHSODWHVDQGQDLOV

&R±&U$OOR\VDV%LRPDWHULDOV

&R±&UDOOR\VDUHPHWDOOLFPL[WXUHVFRQWDLQLQJSULPDULO\&RDQG&UDVZHOODVYDULRXV
DPRXQWVRIRWKHUHOHPHQWVVXFKDV1L0R)H&6L0QDQG7L7KHUHDUHWZRW\SHVRI&R±
&UDOOR\WKDWKDYHEHHQIDEULFDWHGDQGXVHGDVELRPDWHULDOV&R&U0RDQG&R1L&U0RDOOR\V
7KH &R&U0R DOOR\V DUH FRPSRVHG RI &R ± &U ± DQG 0R ± 7KH
&R1L&U0RDOOR\VFRQVLVWRI&R±1L±&U±DQG0R±7KHVH
DOOR\VSRVVHVVKLJK\LHOGLQJVWUHQJWK ‫׽‬03DIRUWKH&R&U0RDOOR\VDQG±03D
IRUWKH&R1L&U0RDOOR\V 7KH&R&U0RDOOR\VFDQEHFDVWZKLOHWKH&R1L&U0RDOOR\VFDQ
EHIRUJHGLQWRLPSODQWVRIGHVLUHGVKDSHV%RWKW\SHVRIDOOR\DUHKLJKO\FRUURVLRQUHVLVWDQW
7KHVHDOOR\VDUHVXLWDEOHPDWHULDOVIRUWKHIDEULFDWLRQRIDUWLILFLDOERQHVDQGMRLQWV



ϭϱϭ

7LWDQLXPDQG7LWDQLXP$OOR\VDV%LRPDWHULDOV

7LWDQLXP LV D PHWDOOLF PDWHULDO WKDW LV FKDUDFWHUL]HG E\ VXSHULRU KDUGQHVV FRUURVLRQ
UHVLVWDQFH DQG OLJKWQHVV  JFP FRPSDUHGWR  JFP IRU LURQ  *LYHQ VXFK IHDWXUHV
WLWDQLXP KDV EHHQ XVHG DV D ELRPDWHULDO IRU WKH UHSODFHPHQW RI ERQHV DQG MRLQWV 7LWDQLXP
PDWHULDOVXVXDOO\FRQWDLQVHYHUDOHOHPHQWVVXFKDVQLWURJHQFDUERQK\GURJHQR[\JHQDQG
LURQ7KHFRQWHQWVRIWKHVHHOHPHQWVDUHYHU\ORZZLWKQLWURJHQUDQJLQJIURP ±
FDUERQ DERXW  K\GURJHQ DERXW  R[\JHQ ± DQG LURQ ±
7LWDQLXPKDVEHHQXVHGWRPDNHDOOR\V$W\SLFDOWLWDQLXPDOOR\LV7L$O9ZKLFKFRQWDLQV
‫ ׽‬DOXPLQXP ‫ ׽‬YDQDGLXP ‫ ׽‬WLWDQLXP DQG ORZ FRQWHQWV RI QLWURJHQ FDUERQ
K\GURJHQR[\JHQDQGLURQ7KHDGGLWLRQRIDOXPLQXPDQGYDQDGLXPLQFUHDVHVWKHVWUHQJWK
DQGFRUURVLRQUHVLVWDQFHRIWKHWLWDQLXPDOOR\)RULQVWDQFHSXUHWLWDQLXPSRVVHVVHV\LHOGLQJ
VWUHQJWK UDQJLQJ IURP  WR  03D ZKHUHDV 7L$O9 H[KLELWV \LHOGLQJ VWUHQJWK ‫׽‬
03D2WKHUW\SHVRIWLWDQLXPDOOR\VKDYHDOVREHHQFUHDWHGWRSURYLGHPRUHIHDWXUHVVXLWDEOH
IRUWKHSHUIRUPDQFHRIWLWDQLXPDOOR\VDVELRPDWHULDOV([DPSOHVLQFOXGH7L9&U$ODQG
7L1E=U 7KH 7L9&U$O DOOR\ FRQWDLQV ‫ ׽‬YDQDGLXP ‫ ׽‬FKURPLXP ‫׽‬
DOXPLQXPDQG‫׽‬WLWDQLXP7KHDGGLWLRQRIWKHVHHOHPHQWVHQKDQFHVWKHVWUHQJWKRIWKH
WLWDQLXPDOOR\7KH7L1E=UDOOR\LVFRPSRVHGRI‫׽‬QLRELXP‫]׽‬LUFRQLXPDQG
‫ ׽‬WLWDQLXP 7KH DGGLWLRQ RI WKHVH HOHPHQWV HQKDQFHV WKH FRUURVLRQ UHVLVWDQFH RI WKH
WLWDQLXPDOOR\

3RWHQWLDO3UREOHPVZLWK0HWDOOLF0DWHULDOV

7KHUHDUHWZRSRWHQWLDOSUREOHPVZLWKWKHXVHPHWDOOLFPDWHULDOVDVELRPDWHULDOV7KHVH
DUHFRUURVLRQDQGELRLQFRPSDWLELOLW\ 7KHVH SUREOHPV SRWHQWLDOO\LQIOXHQFHWKHSHUIRUPDQFH
DQGHQGXUDQFHRIPHWDOOLF ELRPDWHULDOVHVSHFLDOO\ ZKHQ WKHVH PDWHULDOVDUHXVHGWRUHSODFH
ERQHVDQGMRLQWVWKDWDUHVXEMHFWFRQVLGHUDEO\KLJKPHFKDQLFDOORDGV&RUURVLRQLVDSURFHVV
RIPHWDOGHJUDGDWLRQLQGXFHGE\FKHPLFDOUHDFWLRQVSULPDULO\R[LGL]DWLRQ:KHQVXEMHFWWR
ZDWHUEDVHGVROXWLRQVFRQWDLQLQJGLVVROYHGR[\JHQDQGLRQVVXFKDVFKORULGHDQGK\GUR[LGH
PHWDO DWRPV UHDFW ZLWK WKHVH VSHFLHV DQG IRUP R[LGH RU K\GUR[LGH FRPSRXQGV 7KHVH
FRPSRXQGVGHWDFKIURPWKHPHWDOVXUIDFHDQGGLVVROYHLQWKHVROXWLRQ7KHPHWDOLVGHJUDGHG
JUDGXDOO\ 6LQFH WKH SK\VLRORJLFDO IOXLGV LQ WKH KXPDQ ERG\ FRQWDLQ R[LGDWLYH FKHPLFDO
VSHFLHVSURYLGLQJDKDUVKHQYLURQPHQWIRUPHWDOOLFLPSODQWVFRUURVLYHGHJUDGDWLRQRIPHWDOV
RFFXUDWYDULRXVUDWHVGHSHQGLQJRQWKHW\SHRIWKHPHWDODQGWKHORFDOHQYLURQPHQW,URQDQG
VWHHOVFDQEHFRUURGHGHDVLO\LQWKHSUHVHQFHRIZDWHUDQGR[\JHQZKHUHDVFKURPLXPQLFNHO
DQG WLWDQLXP DUH FRQVLGHUDEO\ FRUURVLRQUHVLVWDQW 7KH FRQFHQWUDWLRQ RI R[\JHQ LQ WKH
LQWHUVWLWLDO IOXLGV YDULHV FRQVLGHUDEO\ LQ WKH GLIIHUHQW FRPSDUWPHQWV RI WKH ERG\ 6XFK
YDULDWLRQV VLJQLILFDQWO\ LQIOXHQFH WKH UDWH RI PHWDO FRUURVLRQ $Q LQFUHDVH LQ R[\JHQ
FRQFHQWUDWLRQIDFLOLWDWHVPHWDOFRUURVLRQ

,QDGGLWLRQWRFKHPLFDOIDFWRUVSK\VLFDOIDFWRUVVXFKDVPHFKDQLFDOORDGVDQGIULFWLRQ
DFFHOHUDWHPHWDOFRUURVLRQ)RULQVWDQFHUHSHWLWLYHGHIRUPDWLRQRIPHWDOLPSODQWVFDQLQGXFH
PHFKDQLFDO IDWLJXH ZKLFK IDFLOLWDWHV FKHPLFDO FRUURVLRQ D SKHQRPHQRQ NQRZQ DV IDWLJXH
FRUURVLRQ 6KHDULQJ PRWLRQV EHWZHHQ WZR LPSODQWV LQGXFHV GDPDJH RI WKH SURWHFWLYH
SDVVLYDWLRQ OD\HU FRQWULEXWLQJ WR FRUURVLRQ ZKLFK LV NQRZQ DV IUHWWLQJ FRUURVLRQ 7KHVH
PHFKDQLFDOIDFWRUVVKRXOGEHWDNHQLQWRDFFRXQWLQWKHGHVLJQRIPHWDOOLFLPSODQWV

7KHUH DUH VHYHUDO PHWKRGV WKDW FDQ EH XVHG WR PHDVXUH WKH UDWH RI FRUURVLRQ 7KHVH
LQFOXGH WKH HVWLPDWLRQ RI WKH QXPEHU RI LRQV OLEHUDWHG IURP D PHWDO SHU XQLW WLPH WKH
PHDVXUHPHQWRIWKHGHSWKRIWKHPHWDOFRUURGHGDZD\DQGWKHPHDVXUHPHQWRIWKHORVVRIWKH

ϭϱϮ

PHWDOZHLJKWGXHWRFRUURVLRQSHUXQLWWLPH7KHVHDUHIDLUO\VWUDLJKWIRUZDUGPHWKRGVDQGFDQ
EHDSSOLHGWRLQYLWURWHVWVDQGLQYLYRWHVWVLQDQLPDOPRGHOV

6HYHUDO DSSURDFKHVFDQEHXVHGWRUHGXFHWKHUDWH RI PHWDOFRUURVLRQ )RU VWHHOEDVHG
LPSODQWV WKH DGGLWLRQ RI FKURPLXP FDQ VLJQLILFDQWO\ UHGXFH WKH UDWH RI LPSODQW FRUURVLRQ
VLQFH FKURPLXP FDQ IRUP D VWDEOH SDVVLYH FKURPLXP R[LGH ILOP RQ WKH VWHHO VXUIDFH
0RGXODWLRQRIFDUERQFRQWHQWVPD\DOVRLQIOXHQFHWKHUDWHRIVWHHOFRUURVLRQ6LQFHH[FHVVLYH
FDUERQ FRQWHQW LQGXFHV FDUERQ SUHFLSLWDWLRQ ZKLFK PD\ IDFLOLWDWH VWHHO FRUURVLRQ ORZHULQJ
WKHFDUERQFRQWHQWLVDQHIIHFWLYHDSSURDFKWRUHGXFHWKHUDWHRIVWHHOFRUURVLRQ

2WKHU PHWDOOLF PDWHULDOV VXFK DV FREDOW DQG WLWDQLXP DUH FRQVLGHUDEO\ UHVLVWDQW WR
FRUURVLRQ VLQFH WKHVH PHWDOV DUH LQHUW LQ SK\VLRORJLFDO IOXLGV DQG FDQ IRUP D SDVVLYDWLQJ
R[LGHILOP$OOR\VEDVHGRQWKHVHPHWDOOLFPDWHULDOVH[KLELWLPSURYHGUHVLVWDQFHWRFRUURVLRQ
$OWKRXJKFRUURVLRQUHVLVWDQWDOOR\VDUHXVHGFRUURVLRQVWLOORFFXUVLQDUWLILFLDOPHWDOOLFERQHV
DQG MRLQWV 0HWDOOLF FRUURVLRQ RIWHQ FDXVHV ORFDO VZHOOLQJ DQG SDLQ DQG LQIOXHQFHV WKH
IXQFWLRQRIWKHDUWLILFLDOLPSODQWV&RUURVLRQFDQEHGHWHFWHGE\[UD\H[DPLQDWLRQ

$WVXUJHU\LQIODPPDWRU\UHDFWLRQVDQGPHWDOGHEULVFDQEHIRXQGLQWLVVXHVXUURXQGLQJ
WKHPHWDOOLFLPSODQWV%HFDXVHFRUURVLRQDFFHOHUDWHVPHWDOZHDUDQGIDWLJXHIDLOXUHPHWDOOLF
LPSODQWVZLWKVHYHUHFRUURVLRQVKRXOGEHUHSODFHG

&HUDPLFVDV%LRPDWHULDOV

&HUDPLFVDUHDJURXSRILQRUJDQLFSRO\FU\VWDOOLQHDQGUHIUDFWRU\PDWHULDOVLQFOXGLQJ
PHWDOOLF R[LGHV FDUELGHV VLOLFDWHV K\GULGHV DQG VXOSKLGHV &HUDPLFV DUH FKDUDFWHUL]HG E\
VHYHUDOSK\VLFDOSURSHUWLHVLQFOXGLQJWKHKDUGQHVVLQHUWQHVVWRSK\VLRORJLFDOLRQLFIOXLGVDQG
UHVLVWDQFH WR KLJK FRPSUHVVLYH VWUHVV *LYHQ VXFK SURSHUWLHV FHUDPLFV KDYH EHHQ XVHG DV
ELRPDWHULDOV IRU WKH UHSODFHPHQW RI ERQHV DQG WHHWK ,Q WHUPV RI WKHLU LQWHUDFWLRQ ZLWK
ELRORJLFDO WLVVXHV FHUDPLFV FDQ EH FODVVLILHG LQWR VHYHUDO W\SHV ELRDFWLYH ELRLQHUW DQG
ELRGHJUDGDEOHFHUDPLFV7KHFKDUDFWHULVWLFVDQGDSSOLFDWLRQVRIWKHVHFHUDPLFVDUHGLVFXVVHG
KHUH

%LRDFWLYH&HUDPLFV

%LRDFWLYH FHUDPLFV DUH FHUDPLFV WKDW FDQ LQWHUDFW DQG IRUP ERQGV ZLWK VXUURXQGLQJ
WLVVXHV6XFKFHUDPLFVFDQEHXVHGDV³DGKHVLYHV´IRUSURVWKHVHVHQKDQFLQJWKHDWWDFKPHQW
RI SURVWKHVHV WR DGMDFHQW WLVVXH *LYHQ WKH PHFKDQLFDO VWUHQJWK DQG KDUGQHVV WKLV W\SH RI
FHUDPLF LV RIWHQ XVHG DV DGKHVLYH IRU RUWKRSHGLF DSSOLFDWLRQV VXFK DV WKH UHSDLU DQG
UHSODFHPHQW RIERQHV DQG MRLQWV $PDMRU W\SH RI ELRDFWLYHFHUDPLFLVJODVVFHUDPLFV7KLV
W\SHRIFHUDPLFVLVFRQVWUXFWHGZLWK6L2&D21D2DQG327KHDGKHVLYHSURSHUWLHVRI
JODVV FHUDPLFV DUH GHSHQGHQW RQ WKH IRUPDWLRQ RI D VXUIDFH OD\HU FRPSRVHG RI FDOFLXP
SKRVSKDWHDQGVLOLFRQR[LGH 6L2 %LRDFWLYHJODVVFHUDPLFVPD\QRWRQO\VHUYHDVVWUXFWXUDO
PDWHULDOVEXW DOVRSOD\DUROHLQUHJXODWLQJWKHIXQFWLRQRIKRVWFHOOV)RULQVWDQFHVLOLFRQ±
FDOFLXP JODVV FHUDPLFV RQFH LPSODQWHG LQWR WKH VNHOHWDO V\VWHP FDQ UHOHDVH VLOLFRQ DQG
FDOFLXPLRQVZKLFKVWLPXODWHRVWHREODVWJURZWKDQGGLIIHUHQWLDWLRQ6XFKDSURFHVVLQYROYHV
JHQHVWKDWHQFRGHSURWHLQVUHVSRQVLEOHIRUWKHUHJXODWLRQRIFHOOPLWRVLVDQGGLIIHUHQWLDWLRQ,Q
DGGLWLRQ D FRQWUROOHG UHOHDVH RI VROXEOH FDOFLXP DQG VLOLFRQ IURP D FRPSRVLWH PDWHULDO
FRPSRVHG RI ELRDFWLYH JODVV DQG UHVRUEDEOH SRO\PHU KDV EHHQ VKRZQ WR HQKDQFH WKH
JHQHUDWLRQRI YDVFXODULVHG VRIWWLVVXHV 7KXV E\ FRQWUROOLQJ WKH FRPSRVLWLRQV DQG UHOHDVLQJ

ϭϱϯ

UDWH RI VLOLFRQDQG FDOFLXP ELRDFWLYH JODVV FHUDPLFV FDQ EH XVHG WR PHGLDWH WKH JURZWK RI
ERQHWLVVXHV

%LRDFWLYHJODVVFHUDPLFVKDYHEHHQXVHGQRWRQO\IRUERQHUHSODFHPHQWEXWDOVRIRUVRIW
WLVVXH UHJHQHUDWLRQ 5HFHQW VWXGLHV KDYH VKRZQ WKDW ELRJODVVFRDWHG SRO\VW\UHQH VFDIIROGV
VWLPXODWH WKH SUROLIHUDWLRQ RI FXOWXUHG ILEUREODVWV 6XFK DQ LQIOXHQFH LV GHSHQGHQW RQ WKH
FRQFHQWUDWLRQ RI WKH FRDWLQJ ELRDFWLYH FHUDPLFV $Q H[FHVVLYH FRQFHQWUDWLRQ RI ELRJODVV
LQGXFHVDUHGXFWLRQLQWKHUDWHRIFHOOSUROLIHUDWLRQLQDVVRFLDWLRQZLWKDFKDQJHLQFHOOVKDSH
$ OLPLWHG QXPEHU RI H[SHULPHQWV KDYH GHPRQVWUDWHG WKDW ORZ FRQFHQWUDWLRQ RI ELRJODVV
  PD\ VWLPXODWH WKH H[SUHVVLRQ DQG UHOHDVH RI YDVFXODU HQGRWKHOLDO JURZWK IDFWRU ,Q
YLYRH[SHULPHQWVKDYHVKRZQWKDWELRJODVVFRDWHGVFDIIROGVFDQEHZHOOWROHUDWHGIRUXSWR
GD\V ZKHQ LPSODQWHG VXEFXWDQHRXVO\ LQ WKH UDW :KLOH ILEUREODVWV DFWLYHO\ DGKHUH WR
SRO\ JO\FROLF DFLG  3*$  PHVKHV WKH\ UDUHO\ DGKHUH WR WKH ELRJODVV SDUWLFOHV 7KHVH
REVHUYDWLRQV GHPRQVWUDWH WKDW ELRDFWLYH JODVV FHUDPLFV FDQ EH XVHG DV FRPSRXQGV IRU WKH
IDEULFDWLRQRIFRPSRVLWHVFDIIROGVIRUVRIWWLVVXHHQJLQHHULQJ

%LRLQHUW&HUDPLFV

%LRLQHUW FHUDPLFV LQFOXGLQJ DOXPLQD ]LUFRQLD DQG FDUERQV KDYH EHHQ XVHG DV
ELRPDWHULDOV 7KHVH FHUDPLFV DUH JHQHUDOO\ FRUURVLRQUHVLVWDQW DQG ZHDUUHVLVWDQW 7KH\ GR
QRW FDXVH VLJQLILFDQW WR[LF LQIODPPDWRU\ DQG DOOHUJLF UHDFWLRQV DQG DUH UHODWLYHO\
ELRFRPSDWLEOH 7KHVH FHUDPLFV SRVVHVV FRPPRQ FHUDPLF FKDUDFWHULVWLFV VXFK DV KDUGQHVV
ORZ IULFWLRQDQG UHVLVWDQFH WRFRPSUHVVLYH VWUHVV %HFDXVH RIWKHVH FKDUDFWHULVWLFV ELRLQHUW
FHUDPLFV DUH RIWHQ XVHG WR IDEULFDWH ERQH SODWHV VFUHZV IHPRUDO KHDGV DQG PLGGOH HDU
RVVLFOHV $OXPLQD RU DOXPLQXP R[LGH $O2  LV D W\SLFDO W\SH RI ELRLQHUW FHUDPLFV
$OXPLQDH[LVWVLQQDWXUHDVFU\VWDOFRUXQGXP$FU\VWDOIRUPRIDOXPLQDFDQEHV\QWKHVL]HG
E\DSSO\LQJILQHDOXPLQDSRZGHUWRDIODPHRIPL[HGR[\JHQDQGK\GURJHQ7KHPHFKDQLFDO
VWUHQJWKRIV\QWKHWLFDOXPLQDLVGHSHQGHQWRQWKHJUDLQVL]HDQGSRURVLW\$OXPLQDZLWKVPDOO
JUDLQV DQG ORZ SRURVLW\ KDV KLJK VWUHQJWK $ PLQLPXP RI IOH[XUDO VWUHQJWK  03D DQG
HODVWLF PRGXOXV  *3D LV UHTXLUHG IRU XVLQJ DOXPLQD DV DQ RUWKRSHGLF ELRPDWHULDO ,Q
JHQHUDO DOXPLQD LV D PDWHULDO WKDW LV FKDUDFWHUL]HG E\ KDUGQHVV ORZ IULFWLRQ LQHUWQHVV WR
SK\VLRORJLFDO IOXLG HQYLURQPHQW ORZ WR[LFLW\ DQG ORZ LPPXQRJHQLFLW\ 7KHVH SURSHUWLHV
UHQGHU DOXPLQD D VXLWDEOH RUWKRSHGLF ELRPDWHULDO $OXPLQD KDV EHHQ XVHG WR IDEULFDWH
DUWLILFLDOMRLQWVDQGWRWDOKLSSURVWKHVHV

%LRGHJUDGDEOH&HUDPLFV

%LRGHJUDGDEOHFHUDPLFVDUHFHUDPLFVWKDWFDQEHGHJUDGHGDQGDEVRUEHGLQDELRORJLFDO
V\VWHP$QXPEHURIELRGHJUDGDEOHFHUDPLFVKDYHEHHQGHYHORSHGDQGXVHGDVELRPDWHULDOV
7KHVH LQFOXGH FDOFLXP SKRVSKDWH DOXPLQXP FDOFLXP SKRVSKDWH FRUDOOLQH ]LQFFDOFLXP
SKRVSKRURXV R[LGH DQG ]LQF VXOSKDWH±FDOFLXP SKRVSKDWH 0RVW ELRGHJUDGDEOH FHUDPLFV
FRQWDLQFDOFLXP%LRGHJUDGDEOHFHUDPLFVDUHRIWHQXVHGIRUFRQVWUXFWLQJDUWLILFLDOERQHVDQG
GUXJGHOLYHU\FDUULHUVDVZHOODVWRUHSDLUERQHGDPDJHVGXHWRWUDXPDWXPRUUHPRYDODQG
SDWKRORJLFDOGLVRUGHUV$ELRGHJUDGDEOHFHUDPLFLPSODQWPD\VHUYHDVDWHPSRUDU\IUDPHWKDW
JXLGHVWKHIRUPDWLRQRIWKHVKDSHRIUHPRGHOLQJWLVVXHV7KHDEVRUEHGFHUDPLFPDWHULDOFDQ
EHUHSODFHGE\JURZLQJ WLVVXHHYHQWXDOO\UHVWRULQJWKHQDWXUDOVWUXFWXUHDQGIXQFWLRQRIWKH
GDPDJHG WLVVXH 7KXV ELRGHJUDGDEOH FHUDPLFV DUH VXLWDEOH PDWHULDOV IRU RUWKRSHGLF WLVVXH
UHJHQHUDWLRQ


ϭϱϰ

 &DOFLXP SKRVSKDWH LV D W\SLFDO ELRGHJUDGDEOH FHUDPLFDQG KDV EHHQXVHG WRIDEULFDWH
DUWLILFLDOERQHV&DOFLXPSKRVSKDWHFDQEHFU\VWDOOL]HGLQWRDIRUPNQRZQDVK\GUR[\DSDWLWH
&U\VWDOOL]HG FDOFLXP SKRVSKDWH FDQ EH YHU\ VWLII DQG VWURQJ ZLWK DQ HODVWLF PRGXOXV XS WR
‫* ׽‬3D 1RWH WKDW WKH KDUGHVW WLVVXH LQ RXU ERG\ VXFK DV FRPSDFW ERQHV GHQWLQ DQG
GHQWDOHQDPHOLVFRPSRVHGRIWKHFU\VWDOIRUPRIFDOFLXPSKRVSKDWHZLWKVWUXFWXUHVLPLODUWR
K\GUR[\DSDWLWH 7KXV FDOFLXP SKRVSKDWH LV FRPPRQO\ XVHG LQ RUWKRSDHGLF UHJHQHUDWLYH
HQJLQHHULQJIRUWKHUHSODFHPHQWDQGUHSDLURIPDOIXQFWLRQHGERQHV&DOFLXPSKRVSKDWHEDVHG
ELRPDWHULDOV DUH XVXDOO\ QRQWR[LF DQG ELRFRPSDWLEOH 7KH ELRFRPSDWLELOLW\ RI FDOFLXP
SKRVSKDWHEDVHG ELRFHUDPLFV KDV EHHQ D WRSLF RI UHVHDUFK LQ RUWKRSHGLF UHJHQHUDWLYH
HQJLQHHULQJ ([WHQVLYH LQYHVWLJDWLRQV KDYH VKRZQ WKDW RVWHREODVWV H[KLELW QRUPDO JURZWK
SDWWHUQV ZKHQ FXOWXUHG RQ FDOFLXP SKRVSKDWH PDWHULDOV ,Q DGGLWLRQ FDOFLXP SKRVSKDWH
ELRPDWHULDOV H[HUW D VWLPXODWRU\ HIIHFW RQ WKH H[SUHVVLRQ RI RVWHRJHQLF SURWHLQV DQG WKH
SUROLIHUDWLRQRIRVWHREODVWV7KHVHREVHUYDWLRQVGHPRQVWUDWHWKHVXLWDELOLW\RI XVLQJFDOFLXP
SKRVSKDWHFRPSRXQGVDVELRPDWHULDOVIRURUWKRSDHGLFUHJHQHUDWLYHHQJLQHHULQJ

&DOFLXPSKRVSKDWHFHUDPLFVFDQDOVREHXVHGWRIDEULFDWHGUXJGHOLYHU\GHYLFHV'UXJV
KRUPRQHV RUJURZWK IDFWRUV FDQ EH SDFNHG LQWRELRGHJUDGDEOHFDOFLXPSKRVSKDWHFHUDPLFV
IRULPSODQWDWLRQDQGGHOLYHU\LQWRWDUJHWWLVVXHV:LWKWKHGHJUDGDWLRQRIWKHFHUDPLFGUXJV
RUSURWHLQVFDQEHJUDGXDOO\UHOHDVHG%\FRQWUROOLQJ WKH GHQVLW\ RU FRPSRXQGV RI WKH GUXJ
GHOLYHU\PDWHULDOWKHUDWHRIVXEVWDQFHUHOHDVHFDQEHUHJXODWHG%LRGHJUDGDEOHFHUDPLFVFDQ
EH PL[HG ZLWK ELRGHJUDGDEOH SRO\PHUV VXFK DV SRO\ GOODFWLF DFLGSRO\HWK\OHQHJO\FRO
FRSRO\PHU 3/$3(*  WR IRUP FRPSRVLWH PDWHULDOV 6XFK DQ DSSURDFK HQKDQFHV WKH
FDSDELOLW\RIFRQWUROOLQJWKHUDWHRIVXEVWDQFHUHOHDVH$FRPSRVLWHFHUDPLFPDWHULDOFDQDOVR
VHUYHDVDVFDIIROGIRUWLVVXHUHJHQHUDWLRQ%LRORJLFDODFWLYHVXEVWDQFHVFDQEHLQWHJUDWHGLQWR
WKH VFDIIROG IRU FRQWUROOHG VXEVWDQFH UHOHDVH ZKLFK HQKDQFHV WKH UHJHQHUDWLRQ RI LQMXUHG
WLVVXHV

6XFFHVVDQG)DLOXUHVZLWK%LRPDWHULDOVDQG0HGLFDO'HYLFHV
0RVWELRPDWHULDOVDQGPHGLFDOGHYLFHVSHUIRUPVDWLVIDFWRULO\LPSURYLQJWKHTXDOLW\RI
OLIH IRU WKH UHFLSLHQW RU VDYLQJ OLYHV 6WLOO PDQPDGH FRQVWUXFWV DUH QHYHU SHUIHFW
0DQXIDFWXUHGGHYLFHVKDYHDIDLOXUHUDWH$OVRDOOKXPDQVGLIIHULQJHQHWLFVJHQGHUERG\
FKHPLVWULHVOLYLQJHQYLURQPHQWDQGSK\VLFDODFWLYLW\)XUWKHUPRUHSK\VLFLDQVDOVRGLIIHULQ
WKHLU ³WDOHQW´IRULPSODQWLQJGHYLFHV7KHRWKHUVLGH WR WKH PHGLFDO GHYLFH VXFFHVV VWRU\ LV
WKDW WKHUH DUH SUREOHPV FRPSURPLVHV DQG FRPSOLFDWLRQV WKDW RFFXU ZLWK PHGLFDO GHYLFHV
&HQWUDO LVVXHV IRU WKH ELRPDWHULDOV VFLHQWLVW PDQXIDFWXUHU SDWLHQW SK\VLFLDQ DQG DWWRUQH\
DUH  ZKDWUHSUHVHQWVJRRGGHVLJQ  ZKRVKRXOGEHUHVSRQVLEOHZKHQGHYLFHVSHUIRUP
³ZLWKDQLQDSSURSULDWHKRVWUHVSRQVH´DQG  ZKDWDUHWKHFRVWULVNRUFRVWEHQHILWUDWLRVIRU
WKHLPSODQWRUWKHUDS\"
$Q H[DPSOH LQYROYLQJ OHIW YHQWULFXODU DVVLVW GHYLFHV /9$'V VRPHWLPHVLQFRUUHFWO\
FDOOHG DUWLILFLDO KHDUWV  KHOSV WR FODULI\ WKHVH LVVXHV 7KHUH DUH PDQ\ FRPSOLFDWLRQV ZLWK
/9$'V LQFOXGLQJ FORWWLQJ VWURNHV EORRG GDPDJH DQG EDFWHULDO LQIHFWLRQ $ FOLQLFDO WULDO
FDOOHG 5DQGRPL]HG (YDOXDWLRQ RI 0HFKDQLFDO $VVLVWDQFH IRU WKH 7UHDWPHQW RI &RQJHVWLYH
+HDUW)DLOXUH 5(0$7&+ OHGWRIROORZLQJLPSRUWDQWVWDWLVWLFV3DWLHQWVZLWKDQLPSODQWHG
+HDUWPDWHŠ /9$' 7KRUDWHF /DERUDWRULHV  KDG D  FKDQFH RI VXUYLYLQJ IRU RQH \HDU
FRPSDUHGZLWKDVXUYLYDOUDWHIRUSDWLHQWVZKRWRRNPHGLFDWLRQ WKHFRPPRQWKHUDS\
IRU FRQJHVWLYH KHDUW IDLOXUH  6XUYLYDO IRU WZR \HDUV LQ SDWLHQWV ZLWK WKH +HDUWPDWHŠ ZDV
YHUVXVLQWKHPHGLFDWLRQJURXS$OVRWKH/9$'HQKDQFHGWKHTXDOLW\RIOLIHIRUWKH
SDWLHQWV ± WKH\ IHOW EHWWHU ZHUH OHVV GHSUHVVHG DQG ZHUH PRELOH 1RWH WKDW SDWLHQWV

ϭϱϱ

 SDUWLFLSDWLQJLQWKH5(0$7&+WULDOZHUHQRWHOLJLEOHIRUDKHDUWWUDQVSODQW,QWKHFDVHRI
WKH /9$' ORQJWHUP FOLQLFDO FRPSOLFDWLRQV DVVRFLDWHG ZLWK LPSHUIHFW SHUIRUPDQFH RI
ELRPDWHULDOV GRHV QRW SUHFOXGH FOLQLFDO VXFFHVV RYHUDOO 7KH /9$' LV EHWWHU WKDQ WKH QH[W
EHVWWKHUDS\
7KHVH ILYH FKDUDFWHULVWLFV RI ELRPDWHULDOV VFLHQFH PXOWLGLVFLSOLQDU\ PXOWLPDWHULDO
QHHGGULYHQVXEVWDQWLDOPDUNHWDQGULVNEHQHILWFRORXUWKHILHOGRIELRPDWHULDOV

5HIHUHQFHV


$OOFRFN +5 3XFKHU 65 6FRSHOLDQRV $* 3RO\ > DPLQR DFLG HVWHU  SKRVSKD]HQHV@ DV
VXEVWUDWHVIRUWKHFRQWUROOHGUHOHDVHRIVPDOOPROHFXOHV%LRPDWHULDOV±
$OOFRFN+53XFKHU656FRSHOLDQRV$*3RO\> DPLQRDFLGHVWHU SKRVSKD]HQHV@6\QWKHVLV
FU\VWDOOLQLW\DQGK\GURO\WLFVHQVLWLYLW\LQVROXWLRQDQGWKHVROLGVWDWH 0DFURPROHFXOHV
±
$PEURVLR $0 $OOFRFN +5 .DWWL '6 /DXUHQFLQ &7 'HJUDGDEOH
SRO\SKRVSKD]HQHSRO\ DOSKDK\GUR[\HVWHU  EOHQGV 'HJUDGDWLRQ VWXGLHV %LRPDWHULDOV
±
%DMSDL 3. %LOORWWH :* &HUDPLF ELRPDWHULDOV LQ 7KH %LRPHGLFDO (QJLQHHULQJ +DQGERRN
%URQ]LQR-'HG&5&3UHVVDQG,(((3UHVV&KDS
%URQ]LQR -' 7KH %LRPHGLFDO (QJLQHHULQJ +DQGERRN &5& 3UHVV DQG ,((( 3UHVV 
&KDS  $PHULFDQ 6RFLHW\ IRU 7HVWLQJ DQG 0DWHULDOV $QQXDO %RRN RI $670
6WDQGDUGV 9RO  0HGLFDO 'HYLFHV DQG 6HUYLFHV $PHULFDQ 6RFLHW\ IRU 7HVWLQJ DQG
0DWHULDOV3KLODGHOSKLD
%UR]0(9DQGHU+DUW'/:DVKEXUQ156WUXFWXUHDQGPHFKDQLFDOSURSHUWLHVRISRO\ '/
ODFWLFDFLG SRO\ İFDSURODFWRQH EOHQGV%LRPDWHULDOV±
&DSODQ$,7LVVXHHQJLQHHULQJGHVLJQVIRUWKHIXWXUHQHZORJLFVROGPROHFXOHV7LVVXH(QJ
±
&KDQJ6&15RZOH\-$7RELDV**HQHV1*5R\$.,QMHFWLRQPROGLQJRIFKRQGURF\WH
DOJLQDWH FRQVWUXFWV LQ WKH VKDSH RI IDFLDO LPSODQWV - %LRPHG 0DWHU 5HV ±

&RRNH):%XONSURSHUWLHVRIPDWHULDOVLQ$Q,QWURGXFWLRQWR0DWHULDOVLQ0HGLFLQH5DWQHU
%'+RIIPDQ$66FKRHQ)-/HPRQV-(HGV$FDGHPLF3UHVV6DQ'LHJRSS
±
&XOOHQ%:DWW3:/XQGTYLVW&6LOFRFN'6FKPLGW5-7KHUROHRIR[LGLVHGUHJHQHUDWHG
FHOOXORVHFROODJHQLQFKURQLFZRXQGUHSDLUDQGLWVSRWHQWLDOPHFKDQLVPRIDFWLRQ,QW-
%LRFKHP&HOO%LRO±
&XUUDQ0($WNLQVRQ'/(ZDUW$.0RUULV&$/HSSHUW0).HDWLQJ077KHHODVWLQJHQH
LV GLVUXSWHG E\ D WUDQVORFDWLRQ DVVRFLDWHG ZLWK VXSUDYDOYXODU DRUWLF VWHQRVLV &HOO
±
'D\50%RFFDFFLQL$56KXUH\65RHWKHU-$)RUEHV$$VVHVVPHQWRISRO\JO\FROLFDFLG
PHVKDQG ELRDFWLYH JODVV IRU VRIWWLVVXH HQJLQHHULQJ VFDIIROGV %LRPDWHULDOV ±

'H %DUWROR / 0RUHOOL 6 %DGHU $ 'ULROL ( (YDOXDWLRQ RI FHOO EHKDYLRXU UHODWHG WR
SK\VLFRFKHPLFDOSURSHUWLHVRISRO\PHULFPHPEUDQHVWREHXVHGLQELRDUWLILFLDORUJDQV
%LRPDWHULDOV±
GH &KDODLQ 7 3KLOOLSV -+ +LQHN $ %LRHQJLQHHULQJ RI HODVWLF FDUWLODJH ZLWK DJJUHJDWHG
SRUFLQHDQGKXPDQDXULFXODUFKRQGURF\WHVDQGK\GURJHOVFRQWDLQLQJDOJLQDWHFROODJHQ
DQGNHODVWLQ-%LRPHG0DWHU5HV±

ϭϱϲ

'HQX]LHUH$)HUULHU''DPRXU2'RPDUG$&KLWRVDQ±FKRQGURLWLQVXOSKDWHDQGFKLWRVDQ±
K\DOXURQDWHSRO\HOHFWURO\WHFRPSOH[HVELRORJLFDOSURSHUWLHV%LRPDWHULDOV±

'HWDPRUH 06 $WKDQDVLRX .$ 0RWLYDWLRQ FKDUDFWHUL]DWLRQ DQG VWUDWHJ\ IRU WLVVXH
HQJLQHHULQJWKHWHPSRURPDQGLEXODUMRLQWGLVF7LVVXH(QJ±
'LHW]+&0HFKDP530RXVHPRGHOVRIJHQHWLFGLVHDVHVUHVXOWLQJIURPPXWDWLRQVLQHODVWLF
ILEUHSURWHLQV0DWUL[%LRO±
'RKHQ\ -* -HUYLV (- *XDUQD 00 +XPSKULHV 5. :DUUHQ 5$- &HOOXORVH DV DQ LQHUW
PDWUL[IRUSUHVHQWLQJF\WRNLQHVWRWDUJHWFHOOV3URGXFWLRQDQGSURSHUWLHVRIDVWHPFHOO
IDFWRUFHOOXORVHELQGLQJGRPDLQIXVLRQSURWHLQ%LRFKHP-±
'RPE $- .XPDU 1 6KHVNLQ 7 %HQWROLOD $ 6ODJHU - %LRGHJUDGDEOH SRO\PHUV DV GUXJ
FDUULHU V\VWHP LQ 3RO\PHULF %LRPDWHULDOV QG HG 'XPLWULX 6 HG 0DUFHO 'HNNHU
1HZ<RUNSS±
'RPE $- 1XGHOPDQ 5 ,Q YLYR DQG LQ YLWUR HOLPLQDWLRQ RI DOLSKDWLF SRO\DQK\GULGHV
%LRPDWHULDOV±
'RPE $- 6\QWKHVLV DQG FKDUDFWHUL]DWLRQ RI ELRHURGLEOH DURPDWLF DQK\GULGHV FRSRO\PHUV
0DFURPROHFXOHV
'UXU\-/'HQQLV5*0RRQH\'-7KHWHQVLOHSURSHUWLHVRIDOJLQDWHK\GURJHOV%LRPDWHULDOV
±
'XFKH\QH3%LRJODVVFRDWLQJDQGELRJODVVFRPSRVLWHVDVLPSODQWPDWHULDOV-%LRPHG0DWHU
5HV
(LVHOW3/HH.<0RRQH\'-5LJLGLW\RIWZRFRPSRQHQWK\GURJHOVSUHSDUHGIURPDOJLQDWH
DQGSRO\ HWK\OHQHJO\FRO ±GLDPLQHV0DFURPROHFXOHV±
(PDQXHO %6 &DQQL]]DUR / 2UQVWHLQ*ROGVWHLQ 1 ,QGLN =. <RRQ . &KURPRVRPDO
ORFDOL]DWLRQRIWKHKXPDQHODVWLQJHQH$P-+XP*HQHW±
(QGHUOH - %ODQFKDUG 6 %URQ]LQR - LQ ,QWURGXFWLRQ WR %LRPHGLFDO (QJLQHHULQJ $FDGHPLF
3UHVV6DQ'LHJR&KDS
(QWFKHYD ( %LHQ + <LQ / &KLXQJ<LQ &KXQJ &< )DUUHOO ) )XQFWLRQDO FDUGLDF FHOO
FRQVWUXFWVRQFHOOXORVHEDVHGVFDIIROGLQJ%LRPDWHULDOV±
(QWFKHYD (* <RWRYD /. $QDO\WLFDO DSSOLFDWLRQ RI PHPEUDQHV ZLWK FRYDOHQWO\ ERXQG
JOXFRVHR[LGDVH$QDO&KLP$FWD±
(ZDUW $. -LQ : $WNLQVRQ ' 0RUULV &$ .HDWLQJ 07 6XSUDYDOYXODU DRUWLF VWHQRVLV
DVVRFLDWHGZLWKDGHOHWLRQGLVUXSWLQJWKHHODVWLQJHQH-&OLQ,QYHVW±
(ZDUW$.0RUULV&$$WNLQVRQ'-LQ:6WHUQHV.+HPL]\JRVLW\DWWKHHODVWLQORFXVLQD
GHYHORSPHQWDOGLVRUGHU:LOOLDPVV\QGURPH1DWXUH*HQHW±
)DXU\*3H]HW0.QXWVHQ5+%R\OH:$ +H[LPHU 63 'HYHORSPHQWDO DGDSWDWLRQ RI WKH
PRXVHFDUGLRYDVFXODUV\VWHPWRHODVWLQKDSORLQVXIILFLHQF\-&OLQ,QYHVW±

)D]LR0-0DWWHL0*3DVVDJH(&KX0/%ODFN'+XPDQHODVWLQJHQH1HZHYLGHQFHIRU
ORFDOL]DWLRQWRWKHORQJDUPRIFKURPRVRPH$P-+XP*HQHW±
*DVHURG 2 6PLGVURG 2 6NMDN%UDHN * 0LFURFDSVXOHV RI DOJLQDWH±FKLWRVDQ², $
TXDQWLWDWLYH VWXG\ RI WKH LQWHUDFWLRQ EHWZHHQ DOJLQDWH DQG FKLWRVDQ %LRPDWHULDOV
±
*LUWRQ762HJHPD757UDQTXLOOR57([SORLWLQJJO\FDWLRQWRVWLIIHQDQGVWUHQJWKHQWLVVXH
HTXLYDOHQWVIRUWLVVXHHQJLQHHULQJ-%LRPHG0DWHU5HV±
*ORHFKQHU '& 6DFNV 06 %LOOLDU ./ %DFKUDFK1 0HFKDQLFDO HYDOXDWLRQ DQG GHVLJQ RI D
PXOWLOD\HUHGFROODJHQRXVUHSDLUELRPDWHULDO-%LRPHG0DWHU5HV±
*RPHV 0( 5LEHLUR $6 0DODID\D 3% 5HLV 5/ &XQKD $0 $ QHZ DSSURDFK EDVHG RQ
LQMHFWLRQ PRXOGLQJ WR SURGXFH ELRGHJUDGDEOH VWDUFKEDVHG SRO\PHULF VFDIIROGV
0RUSKRORJ\PHFKDQLFDODQGGHJUDGDWLRQEHKDYLRXU%LRPDWHULDOV±

ϭϱϳ

*RVOLQH - /LOOLH 0 &DUULQJWRQ ( *XHUHWWH 3 2UWOHSS & (ODVWLF SURWHLQV %LRORJLFDO UROHV
DQGPHFKDQLFDOSURSHUWLHV3KLO7UDQV56RF/RQG%%LRO6FL±
+DIHPDQQ % (QVVOHQ 6 (UGPDQQ & 1LHGEDOOD 5 =XKONH $ 8VH RI D
FROODJHQHODVWLQPHPEUDQHIRUWKHHQJLQHHULQJRIGHUPLV%XUQV±
+DNLP 6 0HUJXHULDQ 3$ &KDYH] '5 8VH RI ELRGHJUDGDGEOH PHVK DV D WUDQVSRUW IRU D
FXOWXUHGXURHSLWKHLDOJUDIW$QLPSURYHGPHWKRGXVLQJFROODJHQJHO 8URORJ\±

+HQFK//;\QRV,'3RODN-0%LRDFWLYHJODVVHVIRULQVLWXWLVVXHUHJHQHUDWLRQ-%LRPDWHU
6FL3RO\P(G±
+HQFK//%LRFHUDPLFV)URPFRQFHSWWRFOLQLF-$P&HUDPLF6RF
+LUDQR 6 0LGRULNDZD 7 1RYHO PHWKRG IRU WKH SUHSDUDWLRQ RI 1DF\OFKLWRVDQ ILEUH DQG
1DF\OFKLWRVDQ±FHOOXORVHILEUH%LRPDWHULDOV±
+ROPHV3$$SSOLFDWLRQRI3+%²DPLFURELDOO\SURGXFHGELRGHJUDGDEOHWKHUPRSODVWLF3K\V
7HFKQRO±
+XEEHOO-$0DWHULDOVDVPRUSKRJHQHWLFJXLGHVLQWLVVXHHQJLQHHULQJ&XUU2SLQ%LRWHFKQRO
±
-RKQVRQ)$&UDLJ'400HUFHU$'&KDUDFWHUL]DWLRQRIWKHEORFNVWUXFWXUHDQGPROHFXODU
ZHLJKWRIVRGLXPDOJLQDWHV-3KDUP3KDUPDFRO±
.DLWR 7 0\RXL $ 7DNDRND . 6DLWR 1 1LVKLNDZD 0 3RWHQWLDWLRQ RI WKHDFWLYLW\ RI ERQH
PRUSKRJHQHWLF SURWHLQ LQ ERQH UHJHQHUDWLRQ E\ D 3/$3(*K\GUR[\DSDWLWH
FRPSRVLWH%LRPDWHULDOV±
.DQJ+:7DEDWD<,NDGD<)DEULFDWLRQRISRURXVJHODWLQVFDIIROGVIRUWLVVXHHQJLQHHULQJ
%LRPDWHULDOV±
.KDQ,6PLWK1-RQHV()LQFK'6&DPHURQ5($QDO\VLVDQGHYDOXDWLRQRIDELRPHGLFDO
SRO\FDUERQDWHXUHWKDQHWHVWHGLQDQLQYLWURVWXG\DQGDQRYLQHDUWKURSODVW\PRGHO3DUW
,0DWHULDOVVHOHFWLRQDQGHYDOXDWLRQ%LRPDWHULDOV±
.KRU(/LP/<,PSODQWDEOHDSSOLFDWLRQVRIFKLWLQDQGFKLWRVDQ%LRPDWHULDOV±

.LP %6 1LNRORYVNL - %RQDGLR - 0RRQH\ '- &\OLF PHFKDQLFDO VWUDLQ UHJXODWHV WKH
GHYHORSPHQWRIHQJLQHHUHGVPRRWKPXVFOHWLVVXH1DW%LRWHFKQRO±
.LVVHO7%ULFK=%DQWOH6/DQFUDQMDQ,1LPPHUIDOO933DUHQWHUDOGHSRWV\VWHPVRQWKH
EDVLVRIELRGHJUDGDEOHSRO\HVWHUV-&RQWUROO5HOHDVH
.OHPP ' 6FKXPDQQ ' 8GKDUGW 8 0DUVFK 6 %DFWHULDO V\QWKHVL]HG FHOOXORVH²DUWLILFLDO
EORRGYHVVHOVIRUPLFURVXUJHU\3URJ3RO\P6FL±
.O|FN * 3IHIIHUPDQQ $ 5\VHU & *U|KQ 3 .XWWOHU % %LRFRPSDWLELOLW\ RI PDQQXURQLF
DFLGULFKDOJLQDWH%LRPDWHULDOV±
.QDEH &%HUJHU* *LOGHQKDDU 5 +RZOHWW &5 0DUNRYLF % 7KH IXQFWLRQDO H[SUHVVLRQRI
KXPDQ ERQHGHULYHG FHOOV JURZQ RQ UDSLGO\ UHVRUEDEOH FDOFLXP SKRVSKDWH FHUDPLFV
%LRPDWHULDOV±
.QDEH & 'ULHVVHQV )& 3ODQHOO -$ *LOGHQKDDU 5 %HUJHU * (YDOXDWLRQ RI FDOFLXP
SKRVSKDWHV DQG H[SHULPHQWDO FDOFLXP SKRVSKDWH ERQH FHPHQWV XVLQJ RVWHRJHQLF
FXOWXUHV-%LRPHG0DWHU5HV±
.RKQ-/DQJHU5%LRUHVRUEDEOHDQGELRHURGLEOHPDWHULDOVLQ$Q,QWURGXFWLRQWR0DWHULDOV
LQ 0HGLFLQH 5DWQHU %' +RIIPDQ $6 6FKRHQ )- /HPRQV -( HGV $FDGHPLF 3UHVV
6DQ'LHJRSS±
.XVDND 6 ,ZDWD 7 'RL < 3URSHUWLHV DQG ELRGHJUDGDELOLW\ RI XOWUDKLJKPROHFXODUZHLJKW
SRO\> 5 K\GUR[\EXW\UDWH@ SURGXFHG E\ D UHFRPELQDQW (VFKHULFKLD FROL ,QW - %LRO
0DFURPRO±
/HH +% .LP 66 .KDQJ * 3RO\PHULF ELRPDWHULDOV LQ 7KH %LRPHGLFDO (QJLQHHULQJ
+DQGERRN%URQ]LQR-HG&KDS

ϭϱϴ

/HH .< $OVEHUJ ( 0RRQH\ '- 'HJUDGDEOH DQG LQMHFWDEOH SRO\ DOGHK\GH JXOXURQDWH 
K\GURJHOVIRUERQHWLVVXHHQJLQHHULQJ-%LRPHG0DWHU5HV±
/L & 3ULFH -( 0LODV / +XQWHU 15 .H 6 $QWLWXPRU DFWLYLW\ RI SRO\ /JOXWDPLF DFLG ±
SDFOLWD[HORQV\QJHQHLFDQG[HQRJUDIWHGWXPRUV&OLQ&DQFHU5HV±
/L&<X')1HZPDQ5$&DEUDO)6WHSKHQV/&&RPSOHWHUHJUHVVLRQRIZHOOHVWDEOLVKHG
WXPRUVXVLQJQRYHOZDWHUVROXEOHSRO\ /JOXWDPLFDFLG ±SDFOLWD[HOFRQMXJDWHV &DQFHU
5HVS±
/L&3RO\ /JOXWDPLFDFLG ±DQWLFDQFHUGUXJFRQMXJDWHV$GY'UXJ'HOLYHU\5HY±

/L'<%URRNH%'DYLV(&0HFKDP536RUHQVHQ/.(ODVWLQLVDQHVVHQWLDOGHWHUPLQDQW
RIDUWHULDOPRUSKRJHQHVLV1DWXUH±
/LQGKDUGW5LQ%LRGHJUDGDEOH3RO\PHUVIRU&RQWUROOHG5HOHDVHRI'UXJV6SULQJHU9HUODJ
1HZ<RUN&KDS
/LX64$ONHPD3.7LHFKH&7HIIW%-/LX'=1HJDWLYHUHJXODWLRQRIPRQRF\WHDGKHVLRQ
WR DUWHULDO HODVWLF ODPLQDH E\ VLJQDOUHJXODWRU\ SURWHLQ DOSKD DQG 6+ GRPDLQ
FRQWDLQLQJSURWHLQW\URVLQHSKRVSKDWDVH-%LRO&KHP±
/X-;3UXGKRPPHDX[)0HXQLHU$6HGHO/*XLOOHPLQ*(IIHFWVRIFKLWRVDQRQUDWNQHH
FDUWLODJHV%LRPDWHULDOV±
/\VDJKW 0- 2 /DXJKOLQ - 7KH GHPRJUDSKLF VFRSH DQG HFRQRPLF PDJQLWXGH RI
FRQWHPSRUDU\RUJDQUHSODFHPHQWWKHUDSLHV$6$,2-
0DF/DXJKOLQ)&0XPSHU5-:DQJ-7DJOLDIHUUL-0*LOO, &KLWRVDQDQGGHSRO\PHULVHG
FKLWRVDQ ROLJRPHUV DV FRQGHQVLQJ FDUULHUV IRU LQ YLYR SODVPLG GHOLYHU\ - &RQWURO
5HOHDVH±
0DGLKDOO\690DWWKHZ+:3RURXVFKLWRVDQVFDIIROGVIRUWLVVXHHQJLQHHULQJ %LRPDWHULDOV
±
0DUTXHV $3 5HLV 5/ +XQW -$ 7KH ELRFRPSDWLELOLW\ RI QRYHO VWDUFKEDVHG SRO\PHUV DQG
FRPSRVLWHVLQYLWURVWXGLHV%LRPDWHULDOV±
0DUWVRQ09LOMDQWR-+XUPH76DXNNR3%LRFRPSDWLELOLW\RIFHOOXORVHVSRQJHZLWKERQH
(XU6XUJ5HV±
0LOHZLF]'08UEDQ=%R\G& *HQHWLFGLVRUGHUVRIWKHHODVWLFILEUHV\VWHP 0DWUL[%LRO
±
0LOOHU 5$ %UDG\ -0 &XWULJKW '( 'HJUDGDWLRQ UDWHV RI RUDO UHVRUEDEOH LPSODQWV
SRO\ODFWDWHV DQG SRO\JO\FRODWHV  5DWH PRGLILFDWLRQ ZLWK FKDQJHV LQ 3/$3*$
FRSRO\PHUUDWLRV-%LRPHG0DWHU5HV
0L\DNH00L\DPRWR&6FKQDFNHQEHUJ-.XUDQH5$VDGD<3KRVSKRWUDQVDFHW\ODVHDVD
NH\IDFWRU LQ ELRORJLFDOSURGXFWLRQ RI SRO\K\GUR[\EXW\UDWH $SSO%LRFKHP%LRWHFKQRO
±±
1HWWOHV '/ (OGHU 6+ *LOEHUW -$ 3RWHQWLDO XVH RI FKLWRVDQ DV D FHOO VFDIIROG PDWHULDO IRU
FDUWLODJHWLVVXHHQJLQHHULQJ7LVVXH(QJ±
2OVRQ 70 0LFKHOV 99 8UEDQ = &VLV]DU . &KULVWLDQR $0 $  NE GHOHWLRQ ZLWKLQ WKH
HODVWLQJHQHUHVXOWVLQIDPLOLDOVXSUDYDOYXODUDRUWLFVWHQRVLV+XP0RO*HQHW±

2QLVKL + 0DFKLGD < %LRGHJUDGDWLRQ DQG GLVWULEXWLRQ RI ZDWHUVROXEOH FKLWRVDQ LQ PLFH
%LRPDWHULDOV±
2RQLVKL+%LRFHUDPLFLQRUWKRSHGLFVXUJHU\²RXUFOLQLFDOH[SHULHQFHVLQ %LRFHUDPLFV9RO
+XOEHUW-(+XOEHUW6)HGV5RVH+XOPDQ,QVW7HFKQRORJ\7HUUH+DXWH,1
SS±
3DUN-%/DNHV56%LRPDWHULDOV$Q,QWURGXFWLRQQGHG3OHQXP3UHVV1HZ<RUN
3RLULHU < 3URGXFWLRQ RI SRO\HVWHUV LQ WUDQVJHQLF SODQWV $GY %LRFKHP (QJ %LRWHFKQRO
±

ϭϱϵ

5DPLUH])3DWKRSK\VLRORJ\RIWKHPLFURILEULOHODVWLFILEUHV\VWHPLQWURGXFWLRQ0DWUL[%LRO
±
5HLV 5/ &XQKD $0 %HYLV 0- 6WUXFWXUH GHYHORSPHQW DQG FRQWURO RI LQMHFWLRQ PRXOGHG
K\GUR[\ODSDWLWH UHLQIRUFHG VWDUFK(92+ FRPSRVLWHV $GY 3RO\P 7HFKQRO ±

5HLV5/&XQKD$0&KDUDFWHULVDWLRQRIWZRELRGHJUDGDEOHSRO\PHUVRISRWHQWLDODSSOLFDWLRQ
ZLWKLQWKHELRPHGLFDOILHOG-0DWHU6FL0DWHU0HG±
5HLV 5/ 0HQGHV 6& &XQKD $0 %HYLV 0 3URFHVVLQJ DQG LQYLWUR GHJUDGDWLRQ RI
VWDUFK(92+WKHUPRSODVWLFEOHQGV3RO\P,QW±
5KHH 6+ %RQHOLNH DSDWLWHIRUPLQJ DELOLW\ DQG PHFKDQLFDO SURSHUWLHV RI SRO\ ȕ
FDSURODFWRQH VLOLFDK\EULGDVDIXQFWLRQRISRO\ ȕFDSURODFWRQH FRQWHQW%LRPDWHULDOV
±
5LVEXG 09 %KRQGH 55 6XLWDELOLW\ RI FHOOXORVH PROHFXODU GLDO\VLV PHPEUDQH IRU
ELRDUWLILFLDOSDQFUHDVLQYLWURELRFRPSDWLELOLW\VWXGLHV-%LRPHG0DWHU5HV±

5REHUW / ,QWHUDFWLRQ EHWZHHQ FHOOV DQG HODVWLQ WKH HODVWLQUHFHSWRU &RQQHFW 7LVVXH 5HV
±
5RVH ($ *HOLMQV $& 3K' 0RVNRZLW] $- 0' +HLWMDQ ') 3K' 6WHYHQVRQ /: 0'
'HPELWVN\ : 0' /RQJ -: 0' 3K' $VFKHLP '' 0' 7LHUQH\ $5 03+
/HYLWDQ5*06F:DWVRQ-73K'5RQDQ16516KDSLUR3$0'/D]DU503K'
0LOOHU/:0'*XSWD/5'03+)UD]LHU2+0''HVYLJQH1LFNHQV30'2]
0&0'3RLULHU9/0%$0HLHU3/RQJWHUPXVHRIDOHIWYHQWULFXODUDVVLVWGHYLFH
IRUHQGVWDJHKHDUWIDLOXUH1HZ(QJODQG-RXUQDORI0HGLFLQH
5RZOH\ -$ 0RRQH\ '- $OJLQDWH W\SH DQG 5*' GHQVLW\ FRQWURO P\REODVW SKHQRW\SH -
%LRPHG0DWHU5HV±
5RZOH\-$6XQ=*ROGPDQ'0RRQH\'-%LRPDWHULDOVWRVSDWLDOO\UHJXODWHFHOOIDWH$GY
0DWHU±
5R\ . 0DR +4 +XDQJ 6. /HRQJ .: 2UDO JHQH GHOLYHU\ ZLWK FKLWRVDQ±'1$
QDQRSDUWLFOHV JHQHUDWHV LPPXQRORJLF SURWHFWLRQ LQ D PXULQH PRGHO RI SHDQXW DOOHUJ\
1DWXUH0HG±
6DKD66DKD3%LRHWKLFVDQGDSSOLHGELRPDWHULDOV-%LRPHG0DWHU5HV$SSO%LRPDW

6FKLHGHUPD\HU '/ 6KDSLUR 56 7KH DUWLILFLDO KHDUW DV D EULGJH WR WUDQVSODQW (WKLFDO DQG
OHJDOLVVXHVDWWKHEHGVLGH-+HDUW7UDQVSODQW
6HFKULHVW9)0LDR<-1L\LEL]L&:HVWHUKDXVHQ/DUVRQ$0DWWKHZ+:*$*DXJPHQWHG
SRO\VDFFKDULGHK\GURJHO$QRYHOELRFRPSDWLEOHDQGELRGHJUDGDEOHPDWHULDOWRVXSSRUW
FKRQGURJHQHVLV-%LRPHG0DWHU5HV±
6PLGVU¡G26NMnN%U N*$OJLQDWHDVLPPRELOL]DWLRQPDWUL[IRUFHOOV 7UHQGV%LRWHFKQRO
±
6RFLHW\ IRU %LRPDWHULDOV (GXFDWLRQDO 'LUHFWRU\   6RFLHW\ )RU %LRPDWHULDOV
0LQQHDSROLV01
6SHFWRU 0 1RYHO FHOOVFDIIROG LQWHUDFWLRQV HQFRXQWHUHG LQ WLVVXH HQJLQHHULQJ &RQWUDFWLOH
EHKDYLRXURIPXVFXORVNHOHWDOFRQQHFWLYHWLVVXHFHOOV7LVVXH(QJ±
6WROO*+1LPPHUIDOO)$FHPRJOX0%RGPHU'%DQWOH63RO\ HWK\OHQHFDUERQDWH VSDUW
,, GHJUDGDWLRQ PHFKDQLVPV DQG SDUHQWHUDO GHOLYHU\ RI ELRDFWLYH DJHQWV - &RQWUROO
5HOHDVH±
6XK-.0DWWKHZ+:$SSOLFDWLRQRIFKLWRVDQEDVHGSRO\VDFFKDULGHELRPDWHULDOVLQFDUWLODJH
WLVVXHHQJLQHHULQJ$UHYLHZ%LRPDWHULDOV±

ϭϲϬ

6X]XNL < 7DQLKDUD 0 6X]XNL . 6DLWRX $ 6XIDQ : $OJLQDWH K\GURJHO OLQNHG ZLWK
V\QWKHWLF ROLJLRSHSWLGH GHULYHG IURP %03 DOORZV HFWRSLF RVWHRLQGXFWLRQ LQ YLYR -
%LRPHG0DWHU5HV±
6YHQVVRQ $ 1LFNODVVRQ ( +DUUDK 7 3DQLODLWLV % .DSODQ '/ %DFWHULDO FHOOXORVH DV D
SRWHQWLDO VFDIIROG IRU WLVVXH HQJLQHHULQJ RI FDUWLODJH %LRPDWHULDOV   ± )HE

7DWKDP$66KHZU\35(ODVWRPHULFSURWHLQV%LRORJLFDOUROHVVWUXFWXUHVDQGPHFKDQLVPV
7UHQGV%LRFKHP6FL±
7D\%./H$;+HLOPDQ0/RW]-%UDGIRUG'68VHRIDFROODJHQK\GUR[\DSDWLWHPDWUL[
LQVSLQDOIXVLRQ$UDEELWPRGHO6SLQH±
8UEDQ = 5LD]L 6 6HLGO 7/ .DWDKLUD - 6PRRW /% &RQQHFWLRQ EHWZHHQ HODVWLQ
KDSORLQVXIILFLHQF\DQGLQFUHDVHGFHOOSUROLIHUDWLRQLQSDWLHQWVZLWKVXSUDYDOYXODUDRUWLF
VWHQRVLVDQG:LOOLDPV%HXUHQV\QGURPH$P-+XP*HQHW±
8UEDQ = =KDQJ - 'DYLV (& 0DHGD *. .XPDU $ 6XSUDYDOYXODU DRUWLF VWHQRVLV JHQHWLF
DQG PROHFXODU GLVVHFWLRQ RI D FRPSOH[ PXWDWLRQ LQ WKH HODVWLQ JHQH +XP *HQHW
±
8UU\ ': +XJHO 7 6HLW] 0 *DXE +( 6KHLED / (ODVWLQ $ UHSUHVHQWDWLYH LGHDO SURWHLQ
HODVWRPHU3KLO7UDQV56RF/RQG%%LRO6FL±
8VDPL<2NDPRWR<7DND\DPD76KLJHPDVD<0LQDPL6&KLWLQDQGFKLWRVDQVWLPXODWH
FDQLQH SRO\PRUSKRQXFOHDU FHOOV WR UHOHDVH OHXNRWULHQH % DQG SURVWDJODQGLQ ( -
%LRPHG0DWHU5HV±
9HUFUX\VVH.33UHVWZLFK*'+\DOXURQDWHGHULYDWLYHVLQGUXJGHOLYHU\&ULW5HY7KHU'UXJ
&DUULHU6\VW±
9HUW 0 /L 60 *DUUHDX + 0RUH DERXW WKH GHJUDGDWLRQ RI /$*$GHULYHG PDWULFHV LQ
DTXHRXVPHGLD-&RQWUROO5HOHDVH±
9LVVHU 6$ +HUJHQURWKHU 5: &RRSHU 6/ 3RO\PHUV LQ $Q ,QWURGXFWLRQ WR 0DWHULDOV LQ
0HGLFLQH5DWQHU%'+RIIPDQ$66FKRHQ)-/HPRQV-(HGV$FDGHPLF3UHVV6DQ
'LHJRSS±
:LOOLDPV ') 'HILQLWLRQV LQ ELRPDWHULDOV 3URFHHGLQJV RI D FRQVHQVXV FRQIHUHQFH RI WKH
HXURSHDQ VRFLHW\ IRU ELRPDWHULDOV 9RO  &KHVWHU (QJODQG 0DUFK   1HZ
<RUN(OVHYLHU
:UREHO 0 =HEURZVNL - 6]RSD - 3RO\K\GUR[\EXW\UDWH V\QWKHVLV LQ WUDQVJHQLF IOD[ -
%LRWHFKQRO±
<DPDQH 6 ,ZDVDNL 1 0DMLPD 7 )XQDNRVKL 7 0DVXNR 7 )HDVLELOLW\ RI FKLWRVDQEDVHG
K\DOXURQLFDFLGK\EULGELRPDWHULDOIRUDQRYHOVFDIIROGLQFDUWLODJHWLVVXHHQJLQHHULQJ
%LRPDWHULDOV±
=KDR.'HQJ<&KXQ&KHQ-&KHQ*43RO\K\GUR[\DONDQRDWH 3+$ VFDIIROGVZLWKJRRG
PHFKDQLFDOSURSHUWLHVDQGELRFRPSDWLELOLW\%LRPDWHULDOV±









ϭϲϭ

 &KDSWHU
7LVVXHHQJLQHHULQJ

,QWURGXFWLRQ

7LVVXHHQJLQHHULQJ 7( LVWKHDSSOLFDWLRQRIHQJLQHHULQJSULQFLSOHVWRFHOOFXOWXUHIRU
WKHSXUSRVHRIFRQVWUXFWLQJIXQFWLRQDODQDWRPLFDOXQLWVQRUPDOO\IRUUHFRQVWUXFWLYHVXUJHU\
7KHUH DUH WKUHH PDLQ FRPSRQHQWV FHOO ELRORJ\ PDWHULDOV VFLHQFH SRO\PHUSURWHLQ
ELRFKHPLVWU\  DQG ELRORJLFDO HQJLQHHULQJ 7( DLPV WR VXSSO\ ERG\ SDUWV IRU UHSDLU RI
GDPDJHG WLVVXHV DQG RUJDQV ZLWKRXW FDXVLQJ DQ LPPXQH UHVSRQVH RU LQIHFWLRQV RU XVLQJ
FDGDYHULFWLVVXHRUPXWLODWLQJRWKHUSDUWVRIWKHSDWLHQW7KHGUHDPLVWREOHQGWKHDGYDQWDJHV
RI ELRORJLFDO LQWHJUDWLRQ IURP OLYLQJ JUDIWV ZLWK WKH HDVH VWDELOLW\ DQG VDIHW\ RI SURVWKHWLF
LPSODQWVDQGDVVXFKLWDSSOLHVWRPRVWVXUJLFDOVSHFLDOLWLHV

7ZR FRQWUDVWLQJ SKLORVRSKLHV FDQ EH LGHQWLILHG EHKLQG FXUUHQW DSSURDFKHV WR WLVVXH
HQJLQHHULQJ7KHILUVWDVVXPHVWKDWOLYLQJFHOOVSRVVHVVDQLQQDWHDQGVHOIVXIILFLHQWSRWHQWLDO
IRUELRORJLFDOUHJHQHUDWLRQ7KHLPSOLFDWLRQLVWKDWDGGLWLRQRIVXLWDEOHFHOOW\SHVWRDVXLWDEOH
VXSSRUW PDWUL[ ZKLFK DOORZV SUROLIHUDWLRQ DQG PRYHPHQW ZLOO UHVXOW LQ DQ RUJDQL]HG DQG
IXQFWLRQDO WLVVXH UHVHPEOLQJ WKH WLVVXH RI RULJLQ 7KLV LV OLNHO\ WR EH WKH VLPSOHVW PRVW
HFRQRPLFDSSURDFKZKHUHLWFDQEHDSSOLHG7KHVHFRQGDSSURDFKDVVXPHVWKDWFHOOVUHTXLUH
DJUHDWHUGHJUHHRIFRQWUROWRSURGXFHQHZDQGIXQFWLRQLQJWLVVXHVWUXFWXUHV7KLVDSSURDFK
UHIOHFWVWKHXQGHUVWDQGLQJ WKDW IDUIURPUHJHQHUDWLQJ PDWXUH WLVVXHVUHSDLUUDWKHUSRRUO\ LQ
YLYRDQGPDQ\FHOOVGRQRWRUJDQL]HLQFXOWXUH7KLVYLHZOHDGVWRPRUHFRPSOH[VROXWLRQV
JHQHUDOO\VXSSO\LQJRUJDQL]DWLRQDOFXHVWRUHJXODWHUHVLGHQWFHOOIXQFWLRQDQGSURYLGHVSDWLDO
DQGV\QWKHWLFFRQWUROFXHV%DVHGRQZKDWLVXQGHUVWRRGDERXWWLVVXHUHSDLUDQGUHJHQHUDWLRQ
ELRORJ\ LW VHHPV OLNHO\ WKDW HSLWKHOLDO DQG HQGRWKHOLDO FHOO OD\HUV ZLOO SURYH EHWWHU DW
RUJDQL]LQJ WKHPVHOYHV WKURXJK LQQDWH FHOO EHKDYLRXUV ,Q SDUWLFXODU FHOOV VXFK DV
NHUDWLQRF\WHV DQG YDVFXODU HQGRWKHOLDO FHOOV PDNH VWURQJ FHOOFHOO LQWHUDFWLRQV DQG IRUP
FRKHUHQW VKHHWV &RQYHUVHO\ FRQQHFWLYH WLVVXHV RU PHVHQFK\PDO OD\HUV LQ ZKLFK H[WHQVLYH
GHSRVLWLRQDQGUHPRGHOOLQJ RI FROODJHQ PDWUL[ LVQHHGHG FHQWUDOWRPDQ\7(DSSOLFDWLRQV 
WHQGQRWWRIRUPDSSURSULDWHVWUXFWXUHVVSRQWDQHRXVO\

7KH FRQWULEXWLRQ RI WLVVXH UHSDLU SURFHVVHVLV LPSRUWDQW LQ 7( GHYHORSPHQWV EHFDXVH
WKHVH DUH PRVW VXUJLFDO LPSODQWV LQFOXGLQJ VNLQ EORRG YHVVHOV KHDUW YDOYHV QHUYHV MRLQW
VXUIDFHVDQGOLJDPHQWV&RQVHTXHQWO\WKHUHLVDVSHFWUXPRIVWDJHVDWZKLFK7(FRQVWUXFWV
FDQEHGHVLJQHGWREHLPSODQWHG$WRQHHQGRIWKLVVSHFWUXPLVWKHHQJLQHHUHGWLVVXHZKLFKLV
GHVLJQHGWRJXLGHFRQWURODQGLPSURYHWKHUHSDLUIXQFWLRQHIIHFWLYHO\DFWLQJDVDQLPSODQWHG
SURYLVLRQDO WLVVXH IRU H[DPSOH WR VXSSRUW SHULSKHUDO QHUYH UHSDLU $W WKH RWKHU HQG RI WKH
VSHFWUXP LV D IXOO\ IXQFWLRQLQJ WLVVXH UHDG\ WR ZRUN LQ WKH SDWLHQW ,W LV SUHVHQWO\
LQFRQFHLYDEOHWKDWDIXQFWLRQDOSHULSKHUDOQHUYHFRXOGEHHQJLQHHUHGWRUHSDLUDGHIHFWRUJDS
LQDQHUYHWUDFW:KDWLVQHHGHGLVDFHOOXODUUHSDLUWLVVXHWRJXLGHDQGHQFRXUDJHUHJHQHUDWLRQ
RIH[LVWLQJD[RQVDFURVVWKHJDS7KLVVXSSRUWIXQFWLRQWHQGVWREHVLPSOHUWRSURGXFHWKDQD
IXOO\IXQFWLRQLQJLPSODQWQHHGLQJVLPSOHUDQGVKRUWHULQYLWURWLVVXHPDWXUDWLRQSHULRGVDV
WKLVSURFHVVRFFXUVLQYLYR+RZHYHUWLVVXHIXQFWLRQZLOOUHFRYHUIDUPRUHVORZO\DQGVXFK
FRQVWUXFWV QHHG WR EH IXQFWLRQDOO\ VRSKLVWLFDWHG WR FRQWURO ORFDO UHSDLU SURFHVVHV ORQJ DIWHU
LPSODQWDWLRQ
)XOO\IXQFWLRQLQJLPSODQWVLQFOXGHFRQVWUXFWVGHVLJQHGWRRSHUDWHDVODUJHEORRGYHVVHO
LPSODQWV RU KHDUW YDOYHV ZKHUH VLJQLILFDQW SHULRGV RI SDWLHQW UHFRYHU\ DUH LPSRVVLEOH RU
LPSUDFWLFDO 7LVVXH DSSOLFDWLRQV IDOOLQJ EHWZHHQ WKHVH WZR H[WUHPHV FDQ EH WDFNOHG LQ D
ϭϲϮ

PL[WXUH RI ZD\V &XUUHQW IRUPV RI 7( VNLQ IRU H[DPSOH WHQG WR UHVHPEOH UHSDLU RU
JUDQXODWLRQ WLVVXH PRUH WKDQ D VNLQ JUDIW DOWKRXJK JUDIWDEOH GHUPLV ZRXOG KDYH PDQ\
DGYDQWDJHV

'HVLJQVWDJHVIRUWLVVXHHQJLQHHULQJ

$JHQHUDOL]HGVFKHPHIRUWKHGHVLJQRID7(FRQVWUXFWLVJLYHQLQ7DEOHZLWKVRPH
VSHFLILF H[DPSOHV 7KH VXUJLFDO FULWHULD DUH IUHTXHQWO\ EDVHG RQ SUHYLRXV SURFHGXUHV XVLQJ
JUDIWV DQG SURVWKHVHV LQFOXGLQJ HDVH RI IL[DWLRQ PLQLPDO SDWLHQW GLVFRPIRUW DQG WKH UDSLG
UHVWRUDWLRQ RI IXQFWLRQ 7KH VRXUFH RI GRQRU FHOOV LV FULWLFDOWR WKH GHVLJQ +RZHYHU WKLV LV
RIWHQ RYHUVKDGRZHG E\ WKH TXHVWLRQ RI ZKHWKHU DXWRORJRXV FHOOV DUH HVVHQWLDO :KHUH D
PDWXUHLPSODQWLVQHHGHGDQGOLWWOHUHPRGHOOLQJLVH[SHFWHGXVHRIWKHSDWLHQW VRZQFHOOVLV
IDYRXUHG +RZHYHU DOORJHQHLF FHOOV EHFRPH PRUH DWWUDFWLYH ZKHUH WKH 7( FRQVWUXFW LV
GHVLJQHG DV D WHPSRUDU\ UHSDLU WLVVXH 7KH LPSODQWHG FHOOV KDYH D WHPSRUDU\ UROH DQG DUH
H[SHFWHG WR EH JUDGXDOO\ ORVW LQ UHPRGHOOLQJ $OORJHQHLF DQG [HQRJHQHLF FHOOV FDQ EH
LPPXQRJHQLFDQG QHHGVSHFLDO SUHFDXWLRQV WRVFUHHQIRULQIHFWLRQ+RZHYHUWKH\DUHPRUH
DPHQDEOHIRUXVHLQWKHPDVVSURGXFWLRQRIFRQVLVWHQWUDSLGO\DYDLODEOHORZFRVWFRQVWUXFWV
WKDQLVWKHFDVHZKHUHWKHSDWLHQW VRZQFHOOVPXVWEHXVHG,QWKLVUHVSHFWWKHXVHRIFXOWXUHG
FHOOVDSSHDUVWRSURYLGHDIRUWXQDWHDGYDQWDJHLQWKDWSURORQJHGFXOWXUHRUFU\RSUHVHUYDWLRQ
VHHPV WR UHGXFH WKH DQWLJHQLFLW\ RI DOORJHQHLF FHOOV (DUO\ H[SHULHQFHV ZLWK QHZ
FRPPHUFLDOO\DYDLODEOH7(VNLQ $SOLJUDIΠXVLQJQHRQDWDOKXPDQIRUHVNLQFHOOVDSSHDUWR
VXSSRUWWKLVYLHZ

'HVLJQFULWHULDUHODWHGWRWKHVXSSRUWPDWHULDOLQFOXGHWKHLUSRURVLW\DQGVWUXFWXUH7KH
VXUYLYDO WLPH RI WKH PDWHULDO LV LPSRUWDQW DV DUH LWV GHJUDGDWLRQ SURGXFWV FHOO DGKHVLRQ
FKDUDFWHULVWLFVDQGDELOLW\WRSURSDJDWHVXUIDFHJXLGDQFHDQGPHFKDQLFDOFXHV7KHVHIHDWXUHV
ZLOOE\DFFLGHQWRUGHVLJQFRQWUROWKHW\SHVRIORFDOFHOOVZKLFKDUHUHFUXLWHG PDFURSKDJHV
SRO\PRUSKV ILEUREODVWV VPRRWK PXVFOH FHOOV HSLWKHOLDO RU HQGRWKHOLDO FHOOV  WKHLU VSDWLDO
RUJDQL]DWLRQDQGWKHQDWXUHRIWKHPDWUL[WKH\DVVHPEOH7KUHHWLVVXHH[DPSOHVDUHDQDO\VHG
VNLQ XURWKHOLXP DQG SHULSKHUDO QHUYH  LQ WHUPV RI WKHLU 7( UHTXLUHPHQWV DQG GHVLJQ
IHDWXUHV


7DEOH$QDO\VLVRIILYHPDMRUGHVLJQVWDJHVXVHIXOWRIROORZLQ7(FRQVWUXFWLRQV

'HPRQVWUDWLRQH[DPSOHV5HSDLU
'HVLJQVWDJH VXSSRUW )XOO\IXQFWLRQLQJ,PSODQW
 1HUYHUHSDLU,PSODQW /DUJHYHVVHO,PSODQW
,PPHGLDWHO\IXQFWLRQDO
5DSLGDOLJQHGD[RQUHJHQHUDWLRQ 0HFKDQLFDOO\VWURQJ
/LVWDQGUDQNWKH /LPLWHGOLIHRIVXSSRUWPDWHULDO IOXLGSUHVVXUHDQGVXWXULQJ 
LPSHUDWLYHV (DVHRIVXUJLFDOIL[DWLRQ 1RQWKURPERJHQLFOXPHQ6WURQJ
 1RQILEURJHQLF HODVWLFZDOO
3/$3*$V\QWKHWLFSRO\PHU
6HOHFWDQGRSWLPL]H &ROODJHQVSRQJH &ROODJHQJHORUFROODJHQ*$*
0DWHULDOV )LEURQHFWLQILEURXVWXEH 6SRQJH
 FURVVOLQNHG  3/$RU3*$V\QWKHWLFSRO\PHU
6HOHFWDQGLVRODWH 6FKZDQQFHOOV 6&  6PRRWKPXVFOHFHOOV 60&V 
WKHFHOOV 3HULQHXUDOILEUREODVWV (QGRWKHOLDOFHOOV (&V 
 RUFUXGHFHOOH[WUDFWVIURPQHUYH ILEUREODVWV

ϭϲϯ

 6HHG6&VDWVWDJLQJSRLQWVDORQJ
PDWHULDORUVHHG6&VDWGLVWDO 6HHGRXWHUOD\HUV 60&V 
$VVHPEO\DQGFXOWXUH HQGRIFRQVWUXFW 6HHGOXPHQDOVXUIDFH (&V 
6WDJHV 6HHGRXWHUVXUIDFHZLWKILEUREODVWV /RQJWHUPFXOWXUH XQGHUIORZ 
 0LQLPDO]HURFXOWXUHEHIRUH 
 LPSODQWDWLRQ 
0LQLPDOO\LQIODPPDWRU\VXEVWUDWH )OXLGIORZWKURXJKOXPHQ
0DWUL[ *URZWKIDFWRUV HJ9(*))*) 
,QFRUSRUDWLRQRI &RQWDFWJXLGDQFHVXEVWUDWHVXUIDFHV 0RQLWRUIRUFRQWLQXRXVHQGRWKHOLDO
FRQWURO 0DWHULDOVXUIDFHIRUUDSLG OD\HU
DQGPRQLWRULQJ 0LJUDWLRQ 0RQLWRUIRUPHFKDQLFDOSURSHUWLHV
SURFHVVHV *UDGHGVXEVWUDWHGHJUDGDWLRQ RIZDOO
 6ORZUHOHDVHJURZWKIDFWRUV 0RQLWRUIRUSODWHOHWDGKHVLRQWR
 HJ1*)17  OXPHQ

7LVVXHHQJLQHHUHGVNLQ

7LVVXHHQJLQHHULQJRIVNLQEHFDPHIHDVLEOHLQZLWKWKHGHPRQVWUDWLRQWKDWVKHHWV
RIKXPDQNHUDWLQRF\WHVFRXOGEHJURZQLQWKHODERUDWRU\LQDVXLWDEOHIRUPIRUJUDIWLQJ7KLV
ZDVDVLPSOHFRKHVLYHVKHHWRIFHOOVFXOWXUHGIURPWKHGRQRURQDIHHGHUOD\HURIILEUREODVWV
7KLVWHFKQLTXHKDVEHHQH[WHQVLYHO\PRGLILHGDQGDSSOLHGFOLQLFDOO\EXWDVDVNLQWUHDWPHQW
ZLWKRXWDGHUPDOOD\HULWVXVHVDUHOLPLWHG7KHHSLWKHOLDOFRPSRQHQWLVDEOHWRUHJHQHUDWHLQ
FXOWXUH EHFDXVH WKH FHOOV JURZ DV D FRQWLQXRXV VKHHW RYHU D VXLWDEOH GHQXGHG VXUIDFH
SURGXFLQJ D FRQWLQXRXV OD\HU ZKLFK SURJUHVVHV WR IRUP FRUQLILHG OD\HUV +RZHYHU LW LV WKH
XQGHUO\LQJ GHUPDO OD\HU ZKLFK SUHVHQWV PRUH GLIILFXOWLHV ZLWK LWV UHJXODU FROODJHQRXV
DUFKLWHFWXUHEORRGFDSLOODULHVQHUYHVDQGDFFHVVRU\RUJDQVVXFKDVVZHDWJODQGV7KHUHDUH
YDULRXVIRUPVRILPSODQWDEOHVNLQVXEVWLWXWHVZKLFKFDQEHFRQVLGHUHGDV7(FRQVWUXFWV7KH
ILUVW DQG VLPSOHVW LV D EDVLF FROODJHQJO\FRVDPLQRJO\FDQ VSRQJH NQRZQ DV ,QWHJUDŒ
$OWKRXJK,QWHJUDDORQHLVDELRDUWLILFLDOPDWHULDOUDWKHUWKDQD7(FRQVWUXFWLWKDVEHHQXVHG
WR FDQ\ VHHGHG FHOOV DV KDYH D QXPEHU RI RWKHU FROODJHQ VSRQJHV DQG K\DOXURQDQ ILOPV
,QWHJUDFRQVLVWVRILQVROXEOHERYLQHFROODJHQW\SH,DQGWKHJO\FRVDPLQRJO\FDQ FKRQGURLWLQ
VXOIDWHLQDUDWLRRI'HUPDJUDIWŒFRQVLVWVRI3*$SRO\PHUPHVKRIVXLWDEOHSRUHVL]H
VHHGHGZLWKKXPDQGHUPDOILEUREODVWVIURPQHRQDWDOIRUHVNLQV$VZLWK,QWHJUDWKLVFDQEH
FRYHUHG LQ D NHUDWLQRF\WH VKHHW DW WKH WLPH RI LPSODQWDWLRQ $SOLJUDIΠFRQVLVWV RI KXPDQ
GHUPDOILEUREODVWVVHHGHGLQWRDW\SH,FROODJHQJHODQGDOORZHGWRFRQWUDFWXQGHUWHQVLRQ$
OD\HURIKXPDQNHUDWLQRF\WHVLVWKHQVHHGHGRYHUWKHXSSHUVXUIDFHDWWKHDLUOLTXLGLQWHUIDFH
%RWK FHOO W\SHV LQ WKLV FRQVWUXFW DUH DJDLQ GHULYHG IURP QHRQDWDO IRUHVNLQV DQG VR DUH
DOORJHQHLF6XFK7(FRQVWUXFWVDUHDYDLODEOHIRUVXUJLFDOXVHWKRXJKZLWKDOLPLWHGVKHOIOLIH
SUHVHQWO\ LQ WKH RUGHU RI ILYH GD\V &OLQLFDO DVVHVVPHQW RI WKH SHUIRUPDQFH DQG IDWH RI
$SOLJUDI VXJJHVWV WKDW LPSODQWV QRUPDOO\ LQWHJUDWH ZHOO LQWR VXUURXQGLQJ WLVVXHV IRUPLQJ D
JRRG VNLQ FRYHU ,PSRUWDQWO\ WKHUH LV QR HYLGHQFH RI DQWLERG\ IRUPDWLRQ WR WKH ERYLQH
FROODJHQDQGOLWWOHVLJQRIUHMHFWLRQRIWKHDOORJHQHLFFHOOVLQWKHFRQVWUXFWZKLFKDUHOLNHO\WR
GLVDSSHDUDVWKHFRQVWUXFWLVUHPRGHOOHG

7LVVXHHQJLQHHUHGXURWKHOLXP

$VKXPDQXURWKHOLDOFHOOVDQGEODGGHUVPRRWKPXVFOHFHOOVFDQEHFXOWXUHGLWLVOLNHO\
WKDWFRQVWUXFWLRQRIWLVVXHHQJLQHHUHGXURWKHOLDOLPSODQWVZLOOEHSRVVLEOH7KHFULWHULDDUHWKDW
WKHILQDOVWUXFWXUHVQHHGWRIRUPHODVWLFWXEHVRUEODGGHUVDEOHWRUHPDLQSDWHQW LHZLWKRXW
VWULFWXUHV  DQG WKH LPSODQW VKRXOG QRW DOORZ FU\VWDO IRUPDWLRQ IURP XULQH RU KDUERXU ORFDO

ϭϲϰ

LQIHFWLRQV 7KH VWUXFWXUDO UHTXLUHPHQWV RI WKH WLVVXH DUH UHODWLYHO\ VLPSOH LQ WKDW DQ RXWHU
PXVFOH OD\HU VKRXOG EH OLQHG RQ WKH OXPHQDO VXUIDFH E\ DQ LQWDFW GLIIHUHQWLDWLQJ VKHHW RI
XURWKHOLXP6XSSRUWPDWHULDOVWHVWHGKDYHLQFOXGHGUHVRUEDEOHSRO\PHUV>SRO\ JO\FROLFDFLG 
DQG SRO\ ODFWLFFRJO\FROLF DFLG  FRSRO\PHU 3*$ DQG 3/*$@ DQG FURVV OLQNHG FROODJHQ
VSRQJHV,VRODWHGXURWKHOLDOFHOOVFXOWXUHGRQFROODJHQVSRQJHVIRUPHGGLIIHUHQWLDWHGVKHHWVRI
XURWKHOLXP RYHU WKH VXUIDFH RI WKH PDWHULDO ZLWK PLQLPDO WHQGHQF\ WR SURPRWH FU\VWDO
GHSRVLWLRQ 8URWKHOLDO DQG EODGGHU PXVFOH FHOOV VHHGHG RQWR 3*$ VFDIIROGV IRUPHG
XURWKHOLXPOLNH YDVFXODULVHG ELOD\HUHG WLVVXHV ZKHQ LPSODQWHG LQWR UDEELWV 5HFHQWO\ WKLV
WHFKQLTXHKDVEHHQDSSOLHGWRWKHWLVVXHHQJLQHHULQJRIDIXQFWLRQDOEODGGHULQGRJVXVLQJD
ILEURXV3*$SRO\PHUEDVHVKDSHGLQWRDEODGGHUDQGFRDWHGLQ 3/*$FRSRO\PHUV
0XVFOH FHOOV ZHUH VHHGHG RQWR WKH RXWHU VXUIDFH RI WKH EODGGHU DIWHU ZKLFK WKH OXPHQDO
VXUIDFHZDVFRDWHGZLWKSUHFXOWXUHGXURWKHOLDOFHOOVEHIRUHLPSODQWDWLRQ,PSODQWHGEODGGHUV
DFKLHYHGQHDUQRUPDOSHUIRUPDQFHDQGPDLQWDLQHGWKLVIRUXSWRPRQWKV

7LVVXHHQJLQHHUHGSHULSKHUDOQHUYHLPSODQWV


)LJXUH6FKHPHLOOXVWUDWLQJWKHEDVLFGHVLJQDQGVRPHYDULDWLRQVIRUSHULSKHUDOQHUYH
LPSODQWV 7KUHH HOHPHQWV DUH FRPPRQO\ XVHG 7KH FRQGXLW RXWHU OD\HU RIWHQ WKH SULPDU\
VRXUFH RI JXLGDQFH  7KH ILOOLQJ PDWHULDO FDQ DOVR LQFRUSRUDWH JXLGDQFH HOHPHQWV EXW PRUH
RIWHQLVIRUVXSSRUWRIQHXUDOFHOOV$GGLWLYHVLQFOXGHDKXJHSRVVLEOHYDULHW\RIJURZWKDQG
QHXURWURSKLFIDFWRUVLQPDQ\IRUPVFRPELQDWLRQVUDWLRVDQGUHOHDVHPRGHV

3HULSKHUDO QHUYH LQMXU\ LV D FRPPRQ FRQVHTXHQFH RI WUDXPD DQG WXPRXU UHVHFWLRQ
VXUJHU\ZLWKKXQGUHGVRIWKRXVDQGVRIUHFRQVWUXFWLYHRSHUDWLRQVSHUIRUPHGHDFK\HDU7ZR
FULWHULD GRPLQDWHDSSURDFKHV WRDVVLVWHG UHSDLU RI SHULSKHUDO QHUYH LQMXULHV 7KH ILUVWLVWKDW
UHJHQHUDWLRQ RI D[RQV VKRXOG EH JXLGHG DV WLJKWO\ DV SRVVLEOH IURP WKHLU VSURXWLQJ DW WKH
SUR[LPDO VWXPS WR ZKHUH WKH\ UHMRLQ WKH GHJHQHUDWLQJ GLVWDO VWXPS RQ WKH IDU VLGH RI WKH
GHIHFW 7KH VHFRQG LV WKDW D[RQDO UHJHQHUDWLRQ DFURVV WKH QHUYH GHIHFW PXVW EH DV IDVW DV
SRVVLEOH 3URORQJHG GHOD\ RI UHLQQHUYDWLRQ OHDGV WR LUUHYHUVLEOH PXVFOH DWURSK\ 1HUYH
JXLGDQFH ZDV DFKLHYHG XVLQJ VLOLFRQH FRQGXLWV DWWDFKHG EHWZHHQ WKH QHUYH VWXPSV DQG
UHSRUWHG XVLQJWXEHVRIELRUHVRUEDEOHPDWHULDOVVXFKDV 3/*$ FRSRO\PHU FROODJHQ W\SH ,
DQGSRO\PHUL]HGK\DOXURQDQ7KHWXEHZDOOVSURYLGHJURVVJXLGDQFHEXWQRVSDWLDOFXHVDUH
DYDLODEOHWRD[RQVRU6FKZDQQFHOOVDZD\IURPWKHWXEHZDOO6XSSRUWIRUQHXULWHRXWJURZWK
LQWRWKHWXEHOXPHQKDVEHHQSURYLGHGE\FROODJHQDQGILEULQZLWKRUZLWKRXWDGGHGJURZWK
IDFWRUVEXWDJDLQVXFKJHOVSURYLGHPLQLPDOGLUHFWLRQDOLQIRUPDWLRQ

,QLWLDORXWJURZWKIRUVKRUWGLVWDQFHVIURPWKHSUR[LPDOVWXPSFDQEHUDSLGEXWIRUJDSV
RI !  PPWKH SURFHVV FDQ VORZ RU VWRS SUREDEO\ GXH WR D ODFN RI VXSSRUWLQJ JURZWK
IDFWRUV DQG 6FKZDQQ FHOOV &RQWLQXHG JURZWK FDQ EH DFKLHYHG E\ DGGLQJ SXULILHG JURZWK
IDFWRURUE\VHHGLQJLPSODQWVZLWK6FKZDQQFHOOV,Q DQRWKHUDSSURDFK RSWLPL]DWLRQ RI WKH
PLJUDWLRQVSHHG DVZHOODVGLUHFWLRQ KDVEHHQGHVFULEHGIRURULHQWDWHGILEURQHFWLQLPSODQWV
ϭϲϱ

E\ YDU\LQJ WKH SURSRUWLRQ RI ILEULQRJHQ LQ WKH SRO\PHU PDWHULDO WKXV DOWHULQJ LWV VXUIDFH
DGKHVLRQSURSHUWLHV


&DUGLDF7LVVXH(QJLQHHULQJ

+HDUW GLVHDVH UHPDLQV WKH OHDGLQJ FDXVH RI GHDWK LQ GHYHORSHG FRXQWULHV 7LVVXH
HQJLQHHULQJRIIHUVDSRWHQWLDOWRJURZ LQYLWURIXQFWLRQDOHTXLYDOHQWVRIQDWLYHP\RFDUGLXP
IRU XVH LQ WLVVXH UHSDLUDQG WR LQYHVWLJDWH QHZ ZD\V WR WUHDW RU SUHYHQW WKH GLVHDVH ,Q WKLV
FKDSWHUZHIRFXVRQDWLVVXHHQJLQHHULQJDSSURDFKWRWKHJHQHUDWLRQRIDIXQFWLRQDOFDUGLDF
SDWFK ,Q WKH ILUVW SDUW ZH UHYLHZ WKH FOLQLFDO SUREOHP DQG WKH UHTXLUHPHQWV IRU WKH WLVVXH
HQJLQHHULQJRIDIXQFWLRQDOFDUGLDFSDWFKLQDIRUPVXLWDEOHIRUVXUJLFDOLPSODQWDWLRQ,QWKH
VHFRQG SDUW ZH JLYH DQRYHUYLHZ RI WKH UHSUHVHQWDWLYH PRVW VLJQLILFDQWUHVHDUFKLQ FDUGLDF
WLVVXHHQJLQHHULQJ
7KHELRPLPHWLFDSSURDFKWKURXJKWKHLQWHJUDWHGXVHRIFHOOVVFDIIROGVDQGELRUHDFWRUV
7KHPHFKDQLFDOVWLPXODWLRQRIFDUGLRP\RF\WHVHPEHGGHGLQWKHFROODJHQJHOV
7KHFHOOVKHHWDSSURDFK
:HWKHQGHVFULEHLQPRUHGHWDLOWKHELRPLPHWLFDSSURDFKWRWLVVXHHQJLQHHULQJZKHUH
WKHWLVVXHHQJLQHHULQJDSSURDFK LV GHVLJQHG WR PLPLF WKH PDLQ IDFWRUVSUHVHQW LQWKHQDWLYH
P\RFDUGLXPKLJKFHOOGHQVLW\ZLWKPXOWLSOHFHOOW\SHVFRQYHFWLYHGLIIXVLYHR[\JHQWUDQVSRUW
WKURXJKDFDSLOODU\QHWZRUNDQGH[FLWDWLRQ±FRQWUDFWLRQFRXSOLQJ)LQDOO\ZHGLVFXVVVRPHRI
WKHFXUUHQWFKDOOHQJHVDQGUHVHDUFKQHHGV

%LRPHWULFDSSURDFKWR&DUGLDFWLVVXHHQJLQHHULQJ

:HGHVFULEHKHUHLQGHWDLOWKH³ELRPLPHWLF´DSSURDFKZHKDYHGHYHORSHGIRUFDUGLDF
WLVVXH HQJLQHHULQJ 7KH DSSURDFK LQYROYHV WKH LQ YLWUR FUHDWLRQ RI LPPDWXUH EXW IXQFWLRQDO
WLVVXHVE\DQLQWHJUDWHGXVHRI  GLIIHUHQWLDWHGFHOOV  ELRPDWHULDOVFDIIROGVWKDWVHUYHDV
DVWUXFWXUDODQGORJLVWLFWHPSODWHIRUWLVVXHGHYHORSPHQWDQGWKDWELRGHJUDGHDWDFRQWUROOHG
UDWH DQG   ELRUHDFWRUV WKDW SURYLGH HQYLURQPHQWDO FRQGLWLRQV QHFHVVDU\ IRU WKH FHOOV WR
UHJHQHUDWHDWDIXQFWLRQDOWLVVXH

,QWKLVDSSURDFKDELRUHDFWRUVKRXOGLGHDOO\SURYLGHDOOQHFHVVDU\FRQGLWLRQVLQWKH LQ
YLWURHQYLURQPHQWIRUUDSLGDQGRUGHUO\WLVVXHGHYHORSPHQWE\FHOOVFXOWXUHGRQDVFDIIROG,Q
JHQHUDO D ELRUHDFWRU LV GHVLJQHG WR SHUIRUP RQH RU PRUH RI WKH IROORZLQJ IXQFWLRQV  
HVWDEOLVK D GHVLUHG VSDWLDOO\ XQLIRUP FHOO FRQFHQWUDWLRQ ZLWKLQ WKH VFDIIROG GXULQJ FHOO
VHHGLQJ   PDLQWDLQ FRQWUROOHG FRQGLWLRQV LQ FXOWXUH PHGLXP HJ WHPSHUDWXUH S+
RVPRODOLW\OHYHOVRIR[\JHQQXWULHQWVPHWDEROLWHVUHJXODWRU\PROHFXOHV   IDFLOLWDWHPDVV
WUDQVIHUDQG  SURYLGHSK\VLRORJLFDOO\UHOHYDQWSK\VLFDOVLJQDOV HJLQWHUVWLWLDOIOXLGIORZ
VKHDUSUHVVXUHHOHFWULFDOVWLPXOL GXULQJFXOWLYDWLRQRIFHOO±SRO\PHUFRQVWUXFWV

:HXVHGWKHWLVVXHHQJLQHHULQJPRGHOV\VWHPWRPLPLFWKHPDMRUIDFWRUVSUHVHQWLQWKH
QDWLYH P\RFDUGLXP :H IRFXVHG RQ WKH IROORZLQJ NH\ SDUDPHWHUV LQ WKH FHOO
PLFURHQYLURQPHQW KLJK FHOO GHQVLW\ ZLWK PXOWLSOH FHOO W\SHV FRQYHFWLYHGLIIXVLYH R[\JHQ
WUDQVSRUWWKURXJKDFDSLOODU\QHWZRUNDQGRUGHUO\H[FLWDWLRQFRQWUDFWLRQFRXSOLQJ 7DEOH 






ϭϲϲ

 7DEOH)DFWRUVJRYHUQLQJFDUGLDFWLVVXHGHYHORSPHQWLQYLWURDQGLQYLYR
 ,QYLYR ,QYLWUR
&HOOV +LJKGHQVLW\îFHOOVFP ±îFHOOVFP
0XOWLSOHFHOOW\SHV P\RF\WHV 0XOWLSOHFHOOW\SHV P\RF\WHV
 HQGRWKHOLDOFHOOVILEUREODVWV  ILEUREODVWV 
2[\JHQDQG &RQYHFWLRQDQGGLIIXVLRQLQ
QXWULHQWVXSSO\ &RQYHFWLRQDQGGLIIXVLRQ SHUIXVLRQELRUHDFWRU
&DSLOODU\QHWZRUN GLDPHWHUuP 3DUDOOHOFKDQQHODUUD\LQWKH
*HRPHWU\ VSDFLQJuP  VFDIIROG
2[\JHQFDUULHU +HPRJORELQ 3)&HPXOVLRQ 2[\JHQWŠ 
([FLWDWLRQ±
FRQWUDFWLRQ (OHFWULFDOVLJQDOSURSDJDWLRQ9HQWULFOH (OHFWULFDOVWLPXODWLRQ
FRXSOLQJ FRQWUDFWLRQ &RQVWUXFWFRQWUDFWLRQ


3HUIXVLRQGXULQJ6HHGLQJ(QDEOHG3K\VLRORJLF&HOO'HQVLW\

7RSURYLGHDQR[\JHQVXSSO\WRWKHFHOOVDWOHYHOVQHFHVVDU\WRPDLQWDLQWKHLUYLDELOLW\
ZH GHYHORSHG D WHFKQLTXH RI VHHGLQJ WKDW LQYROYHV   UDSLG FHOO LQRFXODWLRQ LQWR FROODJHQ
VSRQJHVXVLQJ0DWULJHOŠ DV DFHOOGHOLYHU\ YHKLFOHDQG   WUDQVIHU RILQRFXODWHG VFDIIROGV
LQWRSHUIXVHGFDUWULGJHVZLWK LPPHGLDWHHVWDEOLVKPHQWRI WKH LQWHUVWLWLDOIORZRIWKHFXOWXUH
PHGLXP )LJXUH$  )RUZDUG±UHYHUVH IORZ ZDV XVHG IRU WKH LQLWLDO SHULRG RI ± K WR
IXUWKHULQFUHDVHWKHUDWHDQGVSDWLDOXQLIRUPLW\RIFHOOVHHGLQJ8QLGLUHFWLRQDOIORZRIFXOWXUH
PHGLXP ZDV PDLQWDLQHG IRU WKH GXUDWLRQ RI FXOWLYDWLRQ ,Q WKLV V\VWHP FHOOVZHUH ³ORFNHG´
LQWR WKH VFDIIROG GXULQJ D VKRUW  PLQ  JHODWLRQ SHULRG DQG VXSSOLHG ZLWK R[\JHQ DOZD\V
GXULQJFXOWXUH

&HOOGLVWULEXWLRQVLQWKHWRSFHQWHUDQGERWWRPDUHDVRIDȝPZLGHVWULSH[WHQGLQJ
IURPRQHFRQVWUXFWVXUIDFHWRWKHRWKHUDUHVKRZQLQ)LJXUH%&RQVWUXFWVVHHGHGLQGLVKHV
KDGPRVWFHOOVORFDWHGLQWKHȝPWKLFNOD\HUVDWWKHWRSVXUIDFHDQGRQO\DVPDOOQXPEHU
RI FHOOV SHQHWUDWHG WKH HQWLUH FRQVWUXFW GHSWK &RQVWUXFWV VHHGHG LQ SHUIXVLRQ KDG KLJK DQG
VSDWLDOO\ XQLIRUP FHOO GHQVLW\ WKURXJKRXW WKH SHUIXVHG YROXPH RI WKH FRQVWUXFW &OHDUO\
PHGLXP SHUIXVLRQ GXULQJ VHHGLQJ ZDV D NH\ IRU HQJLQHHULQJ WKLFN FRQVWUXFWV ZLWK KLJK
GHQVLWLHV RI YLDEOH FHOOV SUHVXPDEO\ GXH WR HQKDQFHG WUDQVSRUW RI R[\JHQ ZLWKLQ WKH
FRQVWUXFW


ϭϲϳ

 
)LJXUH +LJKGHQVLW\ SHUIXVLRQ VHHGLQJ $  &HOOV DUH UDSLGO\ LQRFXODWHG LQWR FROODJHQ
VSRQJHXVLQJ0DWULJHODQGVHHGHGZLWKDOWHUQDWLQJIORZGLUHFWLRQ % 7KHPHWKRGUHVXOWVLQ
DVSDWLDOO\XQLIRUPGLVWULEXWLRQRIFHOOVDWSK\VLRORJLFDOO\KLJKFRQFHQWUDWLRQVDQGKLJKFHOO
YLDELOLW\$IXOOFURVVVHFWLRQWKURXJKWKHFHQWHULVVKRZQIRUDFRQVWUXFWLQRFXODWHGZLWK
PLOOLRQ&&FHOOVDQGVHHGHGIRUK

3HUIXVLRQ'XULQJ&XOWLYDWLRQ(QDEOHG&HOO9LDELOLW\DQG$HURELF0HWDEROLVP

7KURXJKRXW WKH FXOWLYDWLRQ WKH QXPEHU RI OLYH FHOOV LQ SHUIXVHG FRQVWUXFWV ZDV
VLJQLILFDQWO\ KLJKHU WKDQ LQ GLVK JURZQ FRQVWUXFWV GXH WR WKH SHUIXVLRQ RI FXOWXUH PHGLXP
WKDW ZDV HTXLOLEUDWHG LQ HDFK SDVV ZLWK UHVSHFW WR R[\JHQ DQG S+ LQ DQ H[WHUQDOORRS JDV
H[FKDQJHU )LJXUH$   1RWDEO\ WKH ILQDO FHOO YLDELOLW\ LQ SHUIXVHG FRQVWUXFWV FXOWXUHG IRU
HLJKWGD\V “ ZDVLQGLVWLQJXLVKDEOHIURPWKHYLDELOLW\RIWKHIUHVKO\LVRODWHGFHOOV
 “   DQG LW ZDV PDUNHGO\ KLJKHU WKDQ WKH FHOO YLDELOLW\ LQ GLVKJURZQ FRQVWUXFWV
“  )LJXUH% 

&RQVLVWHQWO\WKHPRODUUDWLRRIODFWDWHSURGXFHGWRJOXFRVHFRQVXPHG /* ZDVIRU
SHUIXVHGFRQVWUXFWVLQGLFDWLQJDHURELFFHOOPHWDEROLVP,QFRQWUDVWLQRUELWDOO\PL[HGGLVKHV
ZLWK FRQYHFWLYH IORZ RI PHGLXP DURXQG WKH FRQVWUXFWV DQG PROHFXODU GLIIXVLRQ ZLWKLQ
FRQVWUXFWV/*LQFUHDVHGSURJUHVVLYHO\IURPWRLQGLFDWLQJDWUDQVLWLRQWRDQDHURELFFHOO
PHWDEROLVP )LJXUH &  &HOO GDPDJH DVVHVVHG E\ PRQLWRULQJ WKH DFWLYLW\ RI ODFWDWH
GHK\GURJHQDVH /'+  LQ FXOWXUH PHGLXP ZDV DW DOO WLPH SRLQWV VLJQLILFDQWO\ ORZHU LQ
SHUIXVLRQWKDQLQGLVKFXOWXUHV3HUIXVHGFRQVWUXFWVDQGQDWLYHYHQWULFOHVKDGPRUHFHOOVLQWKH
6 SKDVH WKDQ LQ WKH *0 SKDVHV ZKHUHDV WKH FHOOV IURP GLVKJURZQ FRQVWUXFWV DSSHDUHG
XQDEOH WR FRPSOHWH WKH FHOO F\FOH DQG DFFXPXODWHG LQ WKH *0 SKDVH &HOOV H[SUHVVLQJ
FDUGLDFVSHFLILFGLIIHUHQWLDWLRQPDUNHUV VDUFRPHULFĮDFWLQVDUFRPHULFWURSRP\RVLQFDUGLDF
WURSRQLQ, ZHUHSUHVHQWWKURXJKRXWWKHSHUIXVHGFRQVWUXFWVDQGRQO\ZLWKLQDSSUR[LPDWHO\D
ȝPWKLFNVXUIDFHOD\HULQGLVKJURZQFRQVWUXFWV

ϭϲϴ

 6SRQWDQHRXVFRQWUDFWLRQVZHUHREVHUYHGLQVRPHFRQVWUXFWVHDUO\LQFXOWXUHDQGFHDVHG
DIWHUDSSUR[LPDWHO\ILYHGD\VRIFXOWLYDWLRQLQGLFDWLQJWKHPDWXUDWLRQRIHQJLQHHUHGWLVVXH,Q
UHVSRQVH WR HOHFWULFDO VWLPXODWLRQ SHUIXVHG FRQVWUXFWV FRQWUDFWHG V\QFKURQRXVO\ KDG ORZHU
H[FLWDWLRQWKUHVKROGVDQGUHFRYHUHGWKHLUEDVHOLQHIXQFWLRQOHYHOVIROORZLQJWUHDWPHQWZLWKD
JDS MXQFWLRQ EORFNHU GLVKJURZQ FRQVWUXFWV H[KLELWHG DUUK\WKPLF FRQWUDFWLOH SDWWHUQV DQG
IDLOHGWRUHFRYHUWKHLUEDVHOLQHOHYHOV+RZHYHUPRVWFHOOVZHUHURXQGDQGPRQRQXFOHDWHGD
VLWXDWLRQOLNHO\GXHWRWKHH[SRVXUHRIFDUGLDFP\RF\WHVWRK\GURG\QDPLFVKHDULQFRQWUDVWWR
WKHQDWLYHKHDUWPXVFOHZKHUHEORRGLVFRQILQHGZLWKLQWKHFDSLOODU\EHGDQGWKHUHIRUHQRWLQ
GLUHFWFRQWDFWZLWKFDUGLDFP\RF\WHV )LJXUH' 7KLVPRWLYDWHGWKHGHVLJQRIVFDIIROGVZLWK
DUUD\VRIFKDQQHOVWKDWSURYLGHDVHSDUDWHFRPSDUWPHQWIRUPHGLXPIORZ




)LJXUH  &RQYHFWLYHGLIIXVLYHR[\JHQWUDQVSRUW GXULQJ FXOWXUH PDLQWDLQV D KLJK GHQVLW\RI
YLDEOHFHOOVDHURELFFHOOPHWDEROLVPDQGXQLIRUPFHOO GLVWULEXWLRQ $  3HUIXVLRQ ORRS % 
FHOOYLDELOLW\ & FHOOPHWDEROLVP ' GLVWULEXWLRQRIFDUGLDF7URSRQLQ,±SRVLWLYHFHOOV



ϭϲϵ

 ,Q 9LYR±/LNH 2[\JHQ 6XSSO\ 0HGLXP 3HUIXVLRQ &KDQQHOHG 6FDIIROGV DQG
2[\JHQ&DUULHUV

7R WHVW WKH IHDVLELOLW\ RI XVLQJ FKDQQHOHG VFDIIROGV FDUGLDF FRQVWUXFWV ZHUH ILUVW
HQJLQHHUHG XVLQJ D FKDQQHOOHG FROODJHQ VFDIIROG 8OWUDIRDP70  FP LQ GLDPHWHU î  PP
WKLFN VHHGHGZLWKQHRQDWDOFDUGLDFP\RF\WHVDQGFXOWLYDWHGLQSHUIXVLRQDWP/PLQIRU
GD\V7KHFKDQQHOPDLQWDLQHGLWVLQLWLDOGLDPHWHUDQGZDVVXUURXQGHGZLWKDȝPWKLFN
WLVVXHOD\HU+RZHYHUFROODJHQLVQRWRSWLPDOIRUFDUGLDFWLVVXHHQJLQHHULQJGXHWRLWVSRRU
VWUXFWXUDOLQWHJULW\:HWKXVH[SORUHGWKHXVHRIDQHODVWRPHUSRO\ JO\FHUROVHEDFDWH 3*6
SUHWUHDWHG ZLWK QHRQDWDO UDW FDUGLRIL EUREODVWV IRU WKUHH GD\V LQ RUELWDOO\ PL[HG GLVKHV
IROORZHGE\WKHDGGLWLRQRIUDWFDUGLRP\RF\WHVDQGSHUIXVLRQFXOWLYDWLRQ )LJXUH$ $IWHU
RQO\WKUHHGD\VRIFXOWXUHFHOOVRQVFDIIROGVIRUPHGFRQVWUXFWVWKDWFRQWUDFWHGV\QFKURQRXVO\
LQUHVSRQVHWRHOHFWULFDOVWLPXODWLRQ )LJXUH& 7KHVFDIIROGSRUHVUHPDLQHGRSHQDQGWKH
SUHVVXUHGURSPHDVXUHGDFURVVWKHFRQVWUXFWZDVDVORZDVN3DPP7RPLPLFWKHR[\JHQ
VXSSO\ RI KHPRJORELQ FXOWXUH PHGLXP ZDV VXSSOHPHQWHG E\  YY 3)& HPXOVLRQ
>2[\JHQW70 NLQGO\ GRQDWHG E\ $OOLDQFH 3KDUPDFHXWLFDOV &RUS 6DQ 'LHJR &$ @
FRQVWUXFWVSHUIXVHGZLWKXQVXSSOHPHQWHGFXOWXUHPHGLXPVHUYHGDVFRQWUROV&RQVWUXFWVZHUH
VXEMHFWHG WR XQLGLUHFWLRQDO PHGLXP IORZ DW D IORZ UDWH RI  P/PLQ SURYLGHG E\ D
PXOWLFKDQQHOSHULVWDOWLFSXPS ,VPD7HF $VWKHPHGLXPIORZHGWKURXJKWKHFKDQQHODUUD\
R[\JHQ ZDV GHSOHWHG IURP WKH DTXHRXV SKDVH RI WKH FXOWXUH PHGLXP E\ GLIIXVLRQ LQWR WKH
FRQVWUXFWVSDFHZKHUHLWZDVXVHGIRUFHOOUHVSLUDWLRQ'HSOHWLRQ RI R[\JHQ LQWKH DTXHRXV
SKDVHDFWHGDVDGULYLQJIRUFHIRUWKHGLIIXVLRQRIGLVVROYHGR[\JHQIURPWKH3)&SDUWLFOHV
WKHUHE\FRQWULEXWLQJWRWKHPDLQWHQDQFHRIKLJKHUR[\JHQFRQFHQWUDWLRQVLQWKHPHGLXP'XH
WR WKHVPDOO VL]H RI 3)& SDUWLFOHV WKH SDVVLYH GLIIXVLRQ RI GLVVROYHG R[\JHQ IURPWKH 3)&
SKDVH LQWR WKH DTXHRXVSKDVH ZDV YHU\ IDVW HVWLPDWHG QRW WR EH D UDWH OLPLWLQJ VWHS LQ WKLV
V\VWHP )RU FRPSDULVRQ LQ XQVXSSOHPHQWHG FXOWXUH PHGLXP R[\JHQ ZDV GHSOHWHG IDVWHU
EHFDXVHWKHUHLVQRR[\JHQFDUULHUSKDVHWKDWDFWVDVDUHVHUYRLU )LJXUH% 

,Q 3)&VXSSOHPHQWHG PHGLXP WKH GHFUHDVH LQ WKH SDUWLDO SUHVVXUH RI R[\JHQ LQ WKH
DTXHRXVSKDVHZDVRQO\RIWKDWLQFRQWUROPHGLXP PP+JYVPP+JEHWZHHQWKH
FRQVWUXFWLQOHWDQGRXWOHWDWWKHIORZUDWHRIP/PLQ &RQVLVWHQWO\FRQVWUXFWVFXOWLYDWHG
LQWKHSUHVHQFHRI3)&KDGKLJKHUDPRXQWVRI'1$WURSRQLQ,DQG&[DQGVLJQLILFDQWO\
EHWWHUFRQWUDFWLOHSURSHUWLHVWKDQFRQWUROFRQVWUXFWV,QERWKJURXSVFHOOVZHUHSUHVHQWDWWKH
FKDQQHOVXUIDFHVDVZHOODVZLWKLQFRQVWUXFWV,PSURYHGFRQVWUXFWSURSHUWLHVZHUHFRUUHODWHG
ZLWK WKH HQKDQFHG VXSSO\ RI R[\JHQ WR WKH FHOOV ZLWKLQ FRQVWUXFWV 7R UDWLRQDOL]H
H[SHULPHQWDO GDWD IRU R[\JHQ WUDQVSRUW DQG FRQVXPSWLRQ LQ HQJLQHHUHG FDUGLDF FRQVWUXFWV
ZLWK DQ DUUD\ RI FKDQQHOV ZH GHYHORSHG D PDWKHPDWLFDO PRGHO RI R[\JHQ GLVWULEXWLRQ LQ
FDUGLDFFRQVWUXFWVVLPLODUWRWKH.URJKF\OLQGHUPRGHO&RQFHQWUDWLRQSURILOHVRIR[\JHQDQG
FHOOVZLWKLQWKHFRQVWUXFWVZHUHREWDLQHGE\QXPHULFDOVLPXODWLRQRIWKHGLIIXVLYHFRQYHFWLYH
R[\JHQWUDQVSRUWDQGLWVXWLOL]DWLRQE\WKHFHOOV7KHPRGHOZDVXVHGWRHYDOXDWHWKHHIIHFWVRI
WKHPHGLXPSHUIXVLRQUDWHR[\JHQFDUULHUDQGVFDIIROGJHRPHWU\RQYLDEOHFHOOGHQVLW\7KH
PRGHO ZDV XVHG WR GHILQH VFDIIROG JHRPHWU\ DQG IORZ FRQGLWLRQV QHFHVVDU\ WR FXOWLYDWH
FDUGLDF FRQVWUXFWV ZLWK FOLQLFDOO\ UHOHYDQW WKLFNQHVVHV  PP  2[\JHQ SURILOHV ZHUH
PRGHOOHGLQDFKDQQHODUUD\FRQVLVWLQJRIFKDQQHOVȝPLQGLDPHWHUDQGȝPZDOOWR
ZDOOVSDFLQJDWSK\VLRORJLFDOO\KLJKFHOOGHQVLW\āFHOOVFP$WFPVWKHR[\JHQ
FRQFHQWUDWLRQLQFUHDVHGVLJQLILFDQWO\LQERWKWKHWLVVXHVSDFHDQGWKHFKDQQHOOXPHQZLWKWKH
LQFUHDVHLQFLUFXODWLQJ3)&HPXOVLRQIURPWR

$OWKRXJKWKHR[\JHQ FRQFHQWUDWLRQ LQ WKH WLVVXHVSDFH ZLWK SK\VLRORJLFDOFHOOGHQVLW\
LQFUHDVHGFRQVLGHUDEO\ZLWKWKHLQFUHDVHRIFLUFXODWLQJ3)&FRQFHQWUDWLRQIURPWR

ϭϳϬ

ZH KDG WR LQFUHDVH WKH IORZ UDWH NHHSLQJ WKH VKHDU VWUHVV LQ WKH SK\VLRORJLFDO UDQJH 
G\QFP WR SURYLGH HQRXJK R[\JHQ IRU WKH HQWLUH FPWKLFN FRQVWUXFW $W RXU EHVW
FRQGLWLRQV  FPV DQG  3)&  )LJXUH '  R[\JHQ LV QRW GHSOHWHG DW DQ\ SRLQW
ZLWKLQWKHWLVVXHFRQVWUXFWDQGWKHPLQLPXPFRQFHQWUDWLRQRIȝ0LVDSSUR[LPDWHO\ILYH
WLPHVDERYHWKH.P R[\JHQFRQFHQWUDWLRQDWZKLFKWKHFRQVXPSWLRQUDWHLQWKHWLVVXHVSDFH
LVPDLQWDLQHGDWDPD[LPXPOHYHO 



)LJXUH  3)& HPXOVLRQ LQFUHDVHV WKH DYHUDJH R[\JHQ FRQFHQWUDWLRQ LQ WKH FKDQQHO OXPHQ
DQG WLVVXH VSDFH E\ LQFUHDVLQJ WKH R[\JHQFDUU\LQJ FDSDFLW\ RI WKH FXOWXUH PHGLXP $ 
&KDQQHOHG VFDIIROGV ZHUH VHHGHG ZLWK FHOOV DQG SHUIXVHG ZLWK FXOWXUH PHGLXP WKDW ZDV
VXSSOHPHQWHG ZLWK D SHUIO XRURFDUERQ 3)&  HPXOVLRQ $ VFDQQLQJ HOHFWURQ PLFURJUDSK
6(0 RI D 3*6 VFDIIROG ZLWK ODVHUERUHG FKDQQHO DUUD\  LV VKRZQ DW WZR PDJQLILFDWLRQV
EHIRUH VHHGLQJ ZLWK FHOOV %  6XSSOHPHQWDWLRQ RI FXOWXUH PHGLXP ZLWK 3)& PDUNHGO\
LQFUHDVHG WKH WRWDO R[\JHQ FRQWHQW DV VKRZQ LQ WDEOH E\ GDWD PHDVXUHG IRU WZR GLIIHUHQW
FRQFHQWUDWLRQV RI 3)& &  6(0 RI FDUGLRP\RF\WHV FXOWXUHG RQ FKDQQHOHG 3*6 VFDIIROG
SHUIXVHG ZLWK 3)&VXSSOHPHQWHG FXOWXUH PHGLXP '  0DWKHPDWLFDO PRGHO RI R[\JHQ
GLVWULEXWLRQLQDSHUIXVHGFKDQQHOHGVFDIIROGZLWKSK\VLRORJLFDOFHOOGHQVLW\ FHOOVFP LQ
WKHWLVVXHVSDFH'DWDDUHVKRZQIRUWKHVXSHUILFLDOIORZYHORFLW\RIFXOWXUHPHGLXPRI

ϭϳϭ

FPVIRUFXOWLYDWLRQVZLWKXQVXSSOHPHQWHGFXOWXUHPHGLXP WRSLPDJH DQGFXOWXUHPHGLXP
VXSSOHPHQWHG ZLWK  YROYRO  RI 3)& ERWWRP LPDJH  7LVVXH FRQVWUXFWV KDG FKDQQHOV
WKDW ZHUH  ȝP LQ GLDPHWHU VSDFHG DW  ȝP ZDOOWRZDOO GLVWDQFH  2[\JHQ
FRQFHQWUDWLRQVLQWKHFKDQQHO RXWOLQHGE\DER[LQWKHFHQWHU DQGWLVVXHVSDFH RQWKHVLGHV 
DUHVKRZQE\FRORUFRGH RQWKHULJKW 

([FLWDWLRQ±&RQWUDFWLRQ&RXSOLQJ(OHFWULFDO6WLPXODWLRQ

,Q QDWLYH KHDUW PHFKDQLFDO VWUHWFK LV LQGXFHG E\ HOHFWULFDO VLJQDOV DQG WKH RUGHUO\
FRXSOLQJ EHWZHHQ HOHFWULFDO SDFLQJ VLJQDOV DQG PDFURVFRSLF FRQWUDFWLRQV LV FUXFLDO IRU WKH
GHYHORSPHQWDQGIXQFWLRQRIQDWLYHP\RFDUGLXP 6HYHUV :HWKHUHIRUHK\SRWKHVL]HG
WKDWDSSO\LQJHOHFWULFDOVLJQDOVGHVLJQHGWRLQGXFHV\QFKURQRXVFRQVWUXFWFRQWUDFWLRQVZRXOG
HQKDQFHFHOOGLIIHUHQWLDWLRQDQGIXQFWLRQDODVVHPEO\RIHQJLQHHUHGWLVVXHYLDSK\VLRORJLFDOO\
UHOHYDQWPHFKDQLVPV7RWHVWWKLVK\SRWKHVLVFDUGLDFFRQVWUXFWVSUHSDUHGE\VHHGLQJFROODJHQ
VSRQJHV îîPP ZLWKQHRQDWDOUDWYHQWULFXODUFHOOV ā ZHUHVWLPXODWHGXVLQJ
VXSUDWKUHVKROG VTXDUH ELSKDVLF SXOVHV  PV GXUDWLRQ  +]  9  7KH VWLPXODWLRQ ZDV
LQLWLDWHGDIWHURQHWRILYHGD\VRIVFDIIROGVHHGLQJ WKUHHGD\SHULRGZDVRSWLPDO DQGDSSOLHG
IRUXSWRHLJKWGD\V

7KH DSSOLFDWLRQ RI HOHFWULFDO VWLPXODWLRQ GXULQJ FRQVWUXFW FXOWLYDWLRQ PDUNHGO\
HQKDQFHGWKHFRQWUDFWLOHEHKDYLRXU$IWHUHLJKWGD\VRIFXOWXUHWKHDPSOLWXGHRIFRQWUDFWLRQV
ZDVVHYHQIROGKLJKHULQVWLPXODWHGWKDQLQQRQVWLPXODWHGFRQVWUXFWV )LJXUH$ DUHVXOWRI
WKH SURJUHVVLYH LQFUHDVH ZLWK WKH GXUDWLRQ RI FXOWXUH 7KH H[FLWDWLRQ WKUHVKROG (7 WKH
PLQLPXPYROWDJHDWZKLFKWKHHQWLUHFRQVWUXFWZDVREVHUYHGWREHDW GHFUHDVHG )LJXUH% 
DQG WKH PD[LPXP FDSWXUH UDWH 0&5 WKH PD[LPXP SDFLQJ IUHTXHQF\ IRU V\QFKURQRXV
FRQVWUXFWFRQWUDFWLRQV LQFUHDVHG )LJXUH& ERWKZLWKWLPHDQGGXHWRHOHFWULFDOVWLPXODWLRQ
VXJJHVWLQJ IXQFWLRQDO FRXSOLQJ RI WKH FHOOV 7KH VKDSH DPSOLWXGH  P9  DQG GXUDWLRQ
 PV  RI WKHHOHFWULFDO DFWLYLW\ UHFRUGHG IRUFHOOV LQ FRQVWUXFWV VWLPXODWHG GXULQJ FXOWXUH
ZHUH VLPLODU WR DFWLRQ SRWHQWLDOV UHSRUWHG IRU FRQVWUXFWV WKDW ZHUH PHFKDQLFDOO\ VWLPXODWHG
GXULQJ FXOWXUH $IWHU HLJKW GD\V VWLPXODWHG FRQVWUXFWV GHPRQVWUDWHG D UHPDUNDEOH OHYHO RI
XOWUDVWUXFWXUDOGLIIHUHQWLDWLRQFRPSDUDEOHLQVHYHUDOUHVSHFWVWRWKDWRIQDWLYHP\RFDUGLXP
&HOOVLQVWLPXODWHGFRQVWUXFWVZHUHDOLJQHGDQGHORQJDWHGDQGFRQWDLQHGFHQWUDOO\SRVLWLRQHG
HORQJDWHG QXFOHL LQ FRQWUDVW WR URXQG FHOOV LQ QRQVWLPXODWHG FRQVWUXFWV ZKLFK KDG D KLJK
QXFOHXVWRF\WRSODVPUDWLR6WLPXODWHGFRQVWUXFWVDQGQHRQDWDOYHQWULFOHVFRQWDLQHGDEXQGDQW
PLWRFKRQGULD SRVLWLRQHG EHWZHHQ P\RILEULOV LQ FRQWUDVW WR QRQVWLPXODWHG FRQVWUXFWV
FRQWDLQLQJPLWRFKRQGULDVFDWWHUHGDURXQGWKHF\WRSODVPDQGVXEVWDQWLDOO\ODUJHUDPRXQWVRI
JO\FRJHQ

(OHFWULFDO VWLPXODWLRQ LQGXFHG WKH GHYHORSPHQW RI ORQJ ZHOODOLJQHG UHJLVWHUV RI
VDUFRPHUHV WKDW FORVHO\ UHVHPEOHG WKRVH LQ QDWLYH P\RFDUGLXP )LJXUH '  UHSUHVHQWLQJ D
KDOOPDUNRIPDWXULQJFDUGLRP\RF\WHV7KHYROXPHIUDFWLRQRIVDUFRPHUHVLQVWLPXODWHGHLJKW
GD\FRQVWUXFWVZDVLQGLVWLQJXLVKDEOHIURPWKDWPHDVXUHGIRUQHRQDWDOYHQWULFOHVLQFRQWUDVW
QRQVWLPXODWHG FRQVWUXFWV FRQWDLQHG RQO\ VFDWWHUHG DQG SRRUO\ RUJDQL]HG VDUFRPHUHV ,Q
VWLPXODWHGFRQVWUXFWVLQWHUFDODWHGGLVFVZHUHSRVLWLRQHGEHWZHHQDOLJQHG=OLQHV )LJXUH( 
DQG ZHUH DV IUHTXHQW DV LQ QHRQDWDO YHQWULFOHV JDS MXQFWLRQV ZHUH DOVR VXEVWDQWLDOO\ EHWWHU
GHYHORSHGDQGPRUHIUHTXHQW

0\RILEHUVDOLJQHGLQWKHGLUHFWLRQRIWKHHOHFWULFDOILHOGOLQHVSRVVLEO\LQDQDWWHPSWWR
GHFUHDVHWKHDSSDUHQW(7LQUHVSRQVHWRSDFLQJ,QFRQWUDVWFHOOVLQQRQVWLPXODWHGFRQVWUXFWV
VWD\HG URXQG DQG H[SUHVVHG UHODWLYHO\ ORZ OHYHOV RI FDUGLDF PDUNHUV $IWHU HLJKW GD\V

ϭϳϮ

VWLPXODWHGFRQVWUXFWVH[KLELWHGDPDUNHGO\KLJKHUGHQVLW\RI&[WKDQHLWKHUHDUO\ WKUHH
GD\ RUQRQVWLPXODWHGFRQVWUXFWV1RWDEO\WKHLPSURYHGFRQWUDFWLOHSURSHUWLHVRIHOHFWULFDOO\
VWLPXODWHGFRQVWUXFWVZHUH QRW UHIOHFWHG LQDQ\DSSDUHQW GLIIHUHQFHV LQFRQVWUXFWFHOOXODULW\
FHOOGDPDJHRUFHOOPHWDEROLVPEXWFRUUHODWHGLQVWHDGZLWKFHOOGLIIHUHQWLDWLRQ

0\RILEHUVDOLJQHGLQWKHGLUHFWLRQRIWKHHOHFWULFDOILHOGOLQHVSRVVLEO\LQDQDWWHPSWWR
GHFUHDVHWKHDSSDUHQW(7LQUHVSRQVHWRSDFLQJ6WLPXODWHGFRQVWUXFWVDQGQHRQDWDOYHQWULFOHV
H[SUHVVHGKLJKOHYHOVRIFDUGLDF7Q,VDUFRPHULFĮDFWLQ&[ Į0+&DQG ȕ0+& DQG
FRQWDLQHG HORQJDWHG FHOOV DOLJQHG LQ SDUDOOHO )LJXUH ) *  ,Q FRQWUDVW FHOOV LQ
QRQVWLPXODWHGFRQVWUXFWVVWD\HGURXQGDQGH[SUHVVHGUHODWLYHO\ORZOHYHOVRIFDUGLDFPDUNHUV
&URVV VWULDWLRQV FKDUDFWHULVWLF RI PDWXUH FDUGLDF P\RF\WHV ZHUH GHWHFWHG LQ VWLPXODWHG
FRQVWUXFWVDQGQDWLYHYHQWULFOHVEXWQRWLQQRQVWLPXODWHGFRQVWUXFWV

,Q RQJRLQJ VWXGLHV RSWLFDO PDSSLQJ WR PHDVXUH WKH LPSXOVH SURSDJDWLRQ LQ WKH
FRQVWUXFWV FXOWLYDWHG LQ WKH SUHVHQFH RU DEVHQFH RI HOHFWULFDO ILHOG VWLPXODWLRQ LV EHLQJ
QRWLFHG7KHFRQVWUXFWVLQWKHVWLPXODWHGJURXSKDGLPSXOVHSURSDJDWLRQRI“9FP
ZKLFK ZDV VLJQLILFDQWO\ KLJKHU WKDQ WKH LPSXOVHSURSDJDWLRQ LQ WKH QRQVWLPXODWHG JURXS RI
“9FP2XUIHDVLELOLW\VWXGLHVRILPSODQWDWLRQRIWKHVWLPXODWHGFRQVWUXFWVLQWKHUDW
PRGHO RI P\RFDUGLDO LQIDUFWLRQ LQGLFDWH WKDW WKH FRQVWUXFWV UHDGLO\ LQWHJUDWH ZLWK WKH KRVW
WLVVXHDQGYDVFXODUL]HIROORZLQJLPSODQWDWLRQ




)LJXUH  (IIHFWV RI HOHFWULFDO VWLPXODWLRQ RQ IXQFWLRQDO DVVHPEO\ RI HQJLQHHUHG FDUGLDF
FRQVWUXFWV $ &RQWUDFWLRQDPSOLWXGHRIFRQVWUXFWVFXOWXUHGIRUDWRWDORIHLJKWGD\VVKRZQ
DVDIUDFWLRQDOFKDQJHLQWKHFRQVWUXFWVL]H(OHFWULFDOVWLPXODWLRQLQFUHDVHGWKHDPSOLWXGHRI
FRQWUDFWLRQV E\ D IDFWRU RI  %  7KH H[FLWDWLRQ WKUHVKROG (7  GHFUHDVHG DQG &  WKH
PD[LPXPFDSWXUH UDWH 0&5  LQFUHDVHG VLJQLILFDQWO\ERWKZLWKWLPHLQFXOWXUHDQGGXHWR
ϭϳϯ

HOHFWULFDO VWLPXODWLRQ  GHQRWHV VWDWLVWLFDOO\ VLJQLIL FDQW GLIIHUHQFHV 3   7XNH\¶V
SRVWKRFWHVWZLWKRQHZD\$129$Q ±VDPSOHVSHUJURXSDQGWLPHSRLQW  ' 7KH
VWUXFWXUH RI VDUFRPHUHV DQG (  JDS MXQFWLRQV REVHUYHG LQ PLFURJUDSKV RI VWLPXODWHG
FRQVWUXFWV DIWHU HLJKW GD\V RI FXOWLYDWLRQ ZHUH UHPDUNDEO\ VLPLODU WR QHRQDWDO UDW YHQWULFOHV
DQG PDUNHGO\ EHWWHU GHYHORSHG WKDQ LQ FRQWURO QRQVWLPXODWHG  FRQVWUXFWV 5HSUHVHQWDWLYH
VHFWLRQV RI FRQVWUXFWV VWDLQHG IRU ȕ0+& JUHHQ (  DQG Į0+& UHG *  FHOO QXFOHL DUH
VKRZQLQEOXH

0XOWLSOH&HOO7\SHV

$WWHPSWV WR HQJLQHHU FDUGLDF WLVVXH LQFOXGLQJ RXU SUHYLRXV VWXGLHV W\SLFDOO\ LQYROYH
WKH XVH RI FHOO SRSXODWLRQV HQULFKHG IRU FDUGLRP\RF\WHV &0  E\ SUHSODWLQJ DQG UHPRYLQJ
UDSLGO\DGKHULQJFHOOV7KHSUHVHQFHRIPXOWLSOHFHOOW\SHVIRUWKHLQYLWURFXOWLYDWLRQRIKHDUW
WLVVXHLQWKHLUV\VWHPZKLFKLQYROYHVWKHDSSOLFDWLRQRIF\FOLFVWUHWFK

6FDIIROG SUHWUHDWPHQW ZLWK FDUGLDF ILEUREODVWV EHIRUH WKH FXOWLYDWLRQ RI FDUGLDF
P\RF\WHVFDQHQKDQFHIXQFWLRQDODVVHPEO\RIWKHHQJLQHHUHGFDUGLDFFRQVWUXFWVE\FUHDWLQJ
DQ HQYLURQPHQW VXSSRUWLYH RI FDUGLRP\RF\WH DWWDFKPHQW GLIIHUHQWLDWLRQ DQG FRQWUDFWLOLW\
1HRQDWDOUDWKHDUWFHOOVZHUHVRUWHGDQGXVHGWRSUHSDUHWKUHHGLVWLQFWFHOOSRSXODWLRQVUDSLGO\
SODWLQJFHOOVLGHQWLILHGDVFDUGLDFILEUREODVWV &) VORZO\SODWLQJFHOOVLGHQWLILHGDVFDUGLDF
P\RF\WHV &0  DQG WKH XQVHSDUDWHG LQLWLDO SRSXODWLRQ RI FHOOV 86  7KH VWUXFWXUH DQG
IXQFWLRQRIHQJLQHHUHGFRQVWUXFWVZLWKUHVSHFWWRWKHXVHRIWKHFRFXOWXUH DVFRPSDUHGWR&0
DORQH DQGZLWKUHVSHFWWRWKHUHJLPHRIFRFXOWXUH FRQFXUUHQWFXOWXUHRI&0DQG&)XVLQJ
86SRSXODWLRQVHTXHQWLDOFRFXOWXUHRI&)DQG&0 IRUPHGZLWK&)DORQHZHUHXVHGDVDQ
DGGLWLRQDO FRQWURO 7KH FHOOV ZHUH FXOWXUHG IRU  GD\V RQ SRURXV VFDIIROGV PDGH RI SRO\
JO\FHURO VHEDFDWH  3*6  &RQVWUXFWV LQ WKH &)  &0 DQG &0 JURXSV H[KLELWHG VLPLODU
IUDFWLRQV RI P\RF\WHV   DQG ILEUREODVWV   DQG VLPLODU DPRXQWVRIFDUGLDFVSHFLILF
SURWHLQV+RZHYHUWKHFRQVWUXFWVLQWKH&)&0JURXSKDGVLJQLILFDQWO\KLJKHUFRQWUDFWLOH
DPSOLWXGHWKDQWKH&0JURXS S DQGVLJQLILFDQWO\ORZHUH[FLWDWLRQWKUHVKROGWKDQWKH
86JURXS S $OVRWKH&)&0JURXSH[KLELWHGDVWUDWLILHGWRȝPWKLFN
WLVVXHOLNHVWUXFWXUHWKDWFRQWDLQHGVRPHHORQJDWHG&0LQFRQWUDVWWRUHODWLYHO\OHVVRUJDQL]HG
FHOOVLQWKH86DQG&0JURXSV7KXVWKHVHTXHQWLDOFRFXOWXUHRI&)DQG&0RQDV\QWKHWLF
HODVWRPHU VFDIIROG FUHDWHG DQ HQYLURQPHQW VXSSRUWLYH RI FDUGLRP\RF\WH DWWDFKPHQW
GLIIHUHQWLDWLRQDQGFRQWUDFWLOHIXQFWLRQ,WLVSRVVLEOHWKDW&)SOD\HGWKHUROHRIDIHHGHUOD\HU
IRU WKH FDUGLDF FHOOV DQG FRQGLWLRQHG WKH VFDIIROG E\ VHFUHWLQJ FROODJHQ ZKLFK LV D QDWXUDO
VXEVWUDWH IRU &0 DWWDFKPHQW 7KLV DSSURDFK FDQ EH XVHG URXWLQHO\ WR SUHFRQGLWLRQ WKH
VFDIIROGVIRUFDUGLDFWLVVXHHQJLQHHULQJ

7LVVXHHQJLQHHUHG/LYHU

&HOOEDVHG WKHUDSLHV IRU OLYHU IDLOXUH RIIHUWKH SRWHQWLDOWR DXJPHQW RU UHSODFH ZKROH
RUJDQWUDQVSODQWDWLRQ+RZHYHUWKHGHYHORSPHQWRIVXFKWKHUDSLHVSRVHVXQLTXHFKDOOHQJHV
VWHPPLQJODUJHO\IURPWKHFRPSOH[LW\RIOLYHUVWUXFWXUHDQGIXQFWLRQ7KHILHOGRIOLYHUWLVVXH
HQJLQHHULQJ HQFRPSDVVHV VHYHUDO DSSURDFKHV FROOHFWLYHO\ DLPHG DW SURYLGLQJ QRYHO
WKHUDSHXWLF RSWLRQV IRU OLYHU GLVHDVH SDWLHQWV DV ZHOO DV HOXFLGDWLQJ IXQGDPHQWDO
FKDUDFWHULVWLFV RI OLYHU ELRORJ\ 7KHVH DSSURDFKHV LQFOXGH WKH GHYHORSPHQW RI   LQ YLWUR
PRGHO V\VWHPV WKDW UHFDSLWXODWH QRUPDO OLYHU IXQFWLRQ   H[WUDFRUSRUHDO ELRDUWLILFDO OLYHU
GHYLFHV IRU WKH WHPSRUDU\ VXSSRUW RI OLYHU IDLOXUH SDWLHQWV DQG   WKUHH GLPHQVLRQDO
LPSODQWDEOHWKHUDSHXWLFFRQVWUXFWV


ϭϳϰ

&HOOVRXUFHVIRU/LYHU&HOOEDVHGWKHUDSLHV

7KH FKRLFH RI FHOO W\SH LV D FULWLFDO SDUDPHWHU IRU DQ\ FHOOEDVHG WKHUDS\ 7DEOH 
KLJKOLJKWV VRPH RI WKH NH\ LVVXHV UHJDUGLQJ WKH XVH RI YDULRXV FHOO VRXUFHV ,PPRUWDOL]HG
KHSDWRF\WHFHOOOLQHVVXFKDV+HS* KXPDQKHSDWREODVWRPD WKH+HS*GHULYHGOLQH&$
+HS/LX 69 LPPRUWDOL]HG  DQG LPPRUWDOL]HGIHWDO KXPDQKHSDWRF\WHVKDYHEHHQXWLOL]HG
DVUHDGLO\DYDLODEOH VXUURJDWHV IRUKHSDWLF WLVVXH +RZHYHULWKDVEHHQVXJJHVWHGWKDW WKHVH
FHOOV ODFN WKH IXOO IXQFWLRQDO FDSDFLW\ RI SULPDU\ DGXOW KHSDWRF\WHV DQG IRU FOLQLFDO
DSSOLFDWLRQVWKHUH LV D ULVN WKDW RQFRJHQLFIDFWRUVFRXOGEHWUDQVPLWWHGWRWKHSDWLHQW7KXV
WKHJHQHUDWLRQRIFRQGLWLRQDOO\LPPRUWDOL]HGOLQHVDQGWKHLQFRUSRUDWLRQRILQGXFLEOHVXLFLGH
JHQHV KDYH EHHQ FRQVLGHUHG DV SRWHQWLDO SUHFDXWLRQDU\ PHDVXUHV 7KH XVH RI SULPDU\
KHSDWRF\WHEDVHGV\VWHPVFRXOGSRWHQWLDOO\HOLPLQDWHWKHVHLVVXHVDQGSURYLGHWKHDSSURSULDWH
FROOHFWLRQ RI OLYHU IXQFWLRQV 3ULPDU\ SRUFLQH KHSDWRF\WHV KDYH EHHQ XWLOL]HG LQ D UDQJH RI
%$/ GHYLFH FRQILJXUDWLRQV ZLWK VRPH HQFRXUDJLQJ UHVXOWV +RZHYHU WKH XWLOLW\ RI
[HQRJHQHLF SRUFLQHFHOOV IRU KXPDQ OLYHUWKHUDSLHV LV UHVWULFWHG E\ LPPXQRJHQLFLW\DQG WKH
SRWHQWLDO IRU [HQR]RRQRWLF WUDQVPLVVLRQ RI LQIHFWLRXV DJHQWV VXFK DV SRUFLQH HQGRJHQRXV
UHWURYLUXV 3(59 

7DEOH&HOOVRXUFHVIRUOLYHUWKHUDSLHV
&HOOVRXUFH &ULWLFDOLVVXHV
3ULPDU\KHSDWRF\WHV 6RXUFLQJH[SDQVLRQSKHQRW\SLFLQVWDELOLW\
+XPDQ[HQRJHQHLF LPPXQRJHQLFLW\VDIHW\ [HQR]RRQRWLF 
,PPRUWDOL]HGKHSDWRF\WHOLQHV 5DQJHRIIXQFWLRQVJHQRPLFLQVWDELOLW\VDIHW\
7XPRUGHULYHG69WHORPHUDVH WXPRULJHQLFLW\ 
VSRQWDQHRXVO\LPPRUWDOL]HG 
6WHPFHOOV 6RXUFLQJGLIIHUHQWLDWLRQHIILFLHQF\SKHQRW\SLF
(PEU\RQLFOLYHUSURJHQLWRUV KHSDWREODVWV LQVWDELOLW\LPPXQRJHQLFLW\VDIHW\
RYDOFHOOV RWKHUOLQHDJHV +6&0$3&  WXPRULJHQLFLW\ 


3ULPDU\ KXPDQ KHSDWRF\WHV DUH XOWLPDWHO\ WKH SUHIHUUHG FHOO W\SH IRU FHOOEDVHG
WKHUDSLHV DQG WKH GHYHORSPHQW RI SULPDU\ KHSDWRF\WH±EDVHG DSSURDFKHV LV WKH IRFXV RI
VXEVWDQWLDO RQJRLQJ UHVHDUFK <HW SURJUHVV KDV EHHQ KLQGHUHG E\ WKH OLPLWHG VXSSO\ RI
SULPDU\KXPDQKHSDWRF\WHVDQGFHUWDLQDVSHFWVRIKHSDWRF\WHSK\VLRORJ\'LVFXVVHGLQPRUH
GHWDLO ODWHU KHSDWRF\WHV H[KLELW D ORVV RI OLYHUVSHFLILF IXQFWLRQV XQGHU PDQ\ FRQGLWLRQV LQ
YLWUR ,Q DGGLWLRQ SDUWLFXODUO\ IRU KXPDQ KHSDWRF\WHV GHVSLWH WKH VLJQLILFDQW SUROLIHUDWLYH
FDSDFLW\GXULQJ UHJHQHUDWLYHUHVSRQVHV LQYLYRPDWXUHKHSDWRF\WHSUROLIHUDWLRQ LQFXOWXUHLV
OLPLWHG $V D UHVXOW DOWHUQDWLYH FHOO VRXUFHV IRU OLYHU FHOO±EDVHG WKHUDSLHV DUH EHLQJ
LQYHVWLJDWHGVXFKDVGLYHUVHVWHPFHOOSRSXODWLRQVZKLFKFDQUHWDLQVLJQLILFDQWSUROLIHUDWLYH
DELOLW\LQYLWURDQGH[KLELWHLWKHUSOXULSRWHQF\RUPXOWLSRWHQF\WKHUHE\FRQVWLWXWLQJDSRVVLEOH
VRXUFH RI KHSDWRF\WHV DV ZHOO DV RWKHU OLYHU FHOO W\SHV 3UHOLPLQDU\ HYLGHQFH VXJJHVWV WKDW
SOXULSRWHQW HPEU\RQLF VWHP FHOOV FDQ EH LQGXFHG WR GLIIHUHQWLDWH WRZDUG WKH KHSDWRF\WH
OLQHDJHLQFXOWXUHDQGPHWKRGVWRLPSURYHWKHUDQJHRIDFTXLUHGKHSDWRF\WHIXQFWLRQVDVZHOO
DV GLIIHUHQWLDWLRQ HIILFLHQF\ FRQWLQXH WR EH H[SORUHG 5HFHQWO\ DQ H[WUDFHOOXODU PDWUL[
PLFURDUUD\ SODWIRUP ZDV XWLOL]HG WR H[DPLQH WKH LQIOXHQFH RI FRPELQDWRULDO PL[WXUHV RI
PDWUL[PROHFXOHVRQHPEU\RQLFVWHPFHOOGLIIHUHQWLDWLRQWRZDUGDQHDUO\KHSDWLFIDWH )LJXUH
 ,QWKLVV\VWHPDQDSSUR[LPDWHO\IROGGLIIHUHQFHLQWKHLQGXFWLRQRIDQHDUO\KHSDWLF
PDUNHU $QNUG  ZDV REVHUYHG EHWZHHQ WKH OHDVW DQG WKH PRVW HIILFLHQW FRQGLWLRQV

ϭϳϱ

XQGHUVFRULQJ WKH LPSRUWDQFH RI KLJKWKURXJKSXW WHFKQRORJLHV LQ WKH HOXFLGDWLRQ RI IDFWRUV
DIIHFWLQJVWHPFHOOGLIIHUHQWLDWLRQ




)LJXUH3ODWIRUPVIRUVWXG\LQJKHSDWRF\WHGLIIHUHQWLDWLRQRIHPEU\RQLFVWHPFHOOVDQGOLYHU
SURJHQLWRUV $  %ULJKWIL HOG DONDOLQH SKRVSKDWDVH VWDLQLQJ RI GD\  (6 FXOWXUHV RQ (&0
PLFURDUUD\VLQVHUXPPHGLXP VFDOHEDUPP  %& 3KDVHFRQWUDVWLPDJHVRIGD\
DUUD\V FXOWXUHG ZLWK /,) %  DQG ZLWK 5$ &  &HOOV FXOWXUHG ZLWK /,) VKRZHG WKUHH
GLPHQVLRQDO IHDWXUHV LQ % LQVHW [] FRQIRFDO VHFWLRQ ȝP WKLFNQHVV  ,Q FRQWUDVW 5$
LQGXFHGFHOOVJUHZDVDUHODWLYHO\WKLQVKHHW LQ&LQVHW[]VHFWLRQȝPWKLFNQHVV 6FDOH
EDUVȝP LQVHWVFDOHEDUVȝP  ' %ULJKWILHOGPLFURJUDSKRIVHOHFWHG;JDOVWDLQHG
(&0PLFURDUUD\FRQGLWLRQVDIWHUGRIFXOWXUHLQ5$&&/)Q WRSOHIWLPDJHV 
LQGXFHGKLJKHU$QNUGUHSRUWHUDFWLYLW\ DUURZKHDGV WKDQZDVVHHQLQFHOOVFXOWXUHGRQ&
 / ERWWRP OHIW LPDJHV  6FDOH EDUV  ȝP 0DJQLILHG YLHZV RI UHSRUWHU DFWLYLW\ VFDOH
EDUVȝP
%DUJUDSKKLHUDUFKLFDOGHSLFWLRQRI³EOXH´LPDJHDUHD SRROHGGDWDIURPIRXUPLFURDUUD\V 
IRUHDFKRIWKHPDWUL[PL[WXUHV(UURUEDUVVHP Q  7KH&&/ )QFXOWXUH
FRQGLWLRQLQGXFHG‫׽‬IROGPRUHȕJDODFWRVLGDVHLPDJHDUHDWKDQWKH&/FXOWXUHV )ODLP
HW DO   (  %0(/ FHOO DJJUHJDWHV HQFDSVXODWHG ZLWKLQ 3(* K\GURJHOV H[KLELW KLJK
YLDELOLW\)OXRUHVFHQWODEHOLQJ GLVWLQJXLVKHGYLDEOH JUHHQ IURPQRQYLDEOH UHG FHOOV6FDOH
EDUȝP ) ([SUHVVLRQRIDOEXPLQ EODFNEDUV DQGDOFRKROGHK\GURJHQDVH $'+JUH\
EDUV P51$ZDVGHWHUPLQHGE\UHDOWLPHTXDQWLWDWLYH573&5DWGD\DQGGD\IROORZLQJ
HQFDSVXODWLRQ RI DJJUHJDWHG %0(/ FHOOV ([SUHVVLRQ IRU HDFK JHQH LV GLVSOD\HG UHODWLYH WR
EDVDO H[SUHVVLRQ H[KLELWHG E\ DGKHUHQW %0(/ FHOOV EHIRUH DJJUHJDWLRQ 7KH KRXVHNHHSLQJ
JHQH +357ZDVXWLOL]HG DVD QRUPDOL]DWLRQ FRQWURODQG GDWD DUHSUHVHQWHGDVWKHPHDQ“
6' Q LQGHSHQGHQWH[SHULPHQWV 


,QDGGLWLRQWRHPEU\RQLFVWHPFHOOVYDULRXVIHWDORUDGXOWVWHPSURJHQLWRUSRSXODWLRQV
KDYH VLPLODUO\ EHHQ LQYHVWLJDWHG )RU H[DPSOH PXOWLSRWHQW DGXOW SURJHQLWRU FHOOV 0$3& 
GHULYHGIURPERQHPDUURZ KDYH EHHQ VKRZQ WR H[KLELW KHSDWRF\WHGLIIHUHQWLDWLRQSRWHQWLDO
)HWDO KHSDWREODVWV DQG RYDO FHOOV DUH DOVR LQWULJXLQJ SRVVLEOH FHOO W\SHV IRU OLYHU FHOO±EDVHG
WKHUDSLHV+HSDWLFGHYHORSPHQWSURFHHGVWKURXJKWKHGLIIHUHQWLDWLRQRIOLYHUSUHFXUVRUFHOOV
WHUPHGKHSDWREODVWVZKLFKH[KLELWELSRWHQWLDOGLIIHUHQWLDWLRQFDSDFLW\GHILQHGE\WKHDELOLW\

ϭϳϲ

WRGLIIHUHQWLDWHLQWRERWKKHSDWRF\WHVDQGELOHGXFWHSLWKHOLDOFHOOV FKRODQJLRF\WHV 1RWDEO\
LQFHUWDLQW\SHVRIVHYHUHDQGFKURQLFOLYHULQMXU\DQDGXOWSURJHQLWRUFHOOSRSXODWLRQWHUPHG
RYDO FHOOV ZKLFK VKDUHV PDQ\ SKHQRW\SLF PDUNHUV DQG IXQFWLRQDO SURSHUWLHV ZLWK IHWDO
KHSDWREODVWV PHGLDWHV FRPSHQVDWRU\ OLYHU UHSDLU WKURXJK D VLPLODU GLIIHUHQWLDWLRQ SURJUDP
([SRVXUH WR WR[LQV RU FDUFLQRJHQV WKDW EORFN KHSDWRF\WH SUROLIHUDWLRQ DQG FRQVHTXHQWO\
QRUPDO OLYHU UHJHQHUDWLRQ UHVXOWV LQ WKH SUROLIHUDWLRQ RI RYDO FHOOV ZLWKLQ WKH OLYHU DQG
VXEVHTXHQW OLYHU UHSDLU GXH WR WKH GLIIHUHQWLDWLRQ RI WKHVH FHOOV 5HFHQW ZRUN E\ :HLVV DQG
FROOHDJXHVGHPRQVWUDWHVWKHGHYHORSPHQWRIELSRWHQWLDOPRXVHHPEU\RQLFOLYHU %0(/ FHOO
OLQHV WKDW DUH GHULYHG IURP PRXVH ( HPEU\RV DQG H[KLELW FKDUDFWHULVWLFV UHPLQLVFHQW RI
IHWDO KHSDWREODVWV DQG RYDO FHOOV ,Q SDUWLFXODU WKHVH FHOO OLQHV DUH QRQWUDQVIRUPHG DQG
SUROLIHUDWLYH GHPRQVWUDWH XSUHJXODWLRQ RI KHSDWRF\WH RU ELOH GXFW HSLWKHOLDO PDUNHUV XQGHU
GLVWLQFWFXOWXUHFRQGLWLRQVLQYLWURDQGH[KLELWWKHFDSDFLW\WRKRPHWRWKHOLYHUDQGXQGHUJR
ELSRWHQWLDO GLIIHUHQWLDWLRQ LQ YLYR ZLWKLQ D UHJHQHUDWLRQ FRQWH[W 7KLV V\VWHP KLJKOLJKWV WKH
SRWHQWLDORISURJHQLWRUFHOOOLQHVIRUWLVVXHUHSDLU$VVXFKWRZDUGWKHHYHQWXDOLQFRUSRUDWLRQ
RI %0(/ FHOOV LQWR LPSODQWDEOH WLVVXHHQJLQHHUHG FRQVWUXFWV DQG GLVFXVVHG LQ PRUH GHWDLO
ODWHU LQ WKLV FKDSWHU %0(/ FHOOV KDYH EHHQ VXFFHVVIXOO\ HQFDSVXODWHG ZLWKLQ D ELRPDWHULDO
VFDIIROG 3(* K\GURJHO  DQG WKHLU GLIIHUHQWLDWLRQ WRZDUG WKH KHSDWRF\WH OLQHDJH ZDV
GHPRQVWUDWHGWRSURFHHGHIILFLHQWO\LQWKLVV\VWHP

$OWKRXJKGLYHUVHVWHPDQGSURJHQLWRUFHOOSRSXODWLRQVH[KLELWYDVWSRWHQWLDOUHJDUGLQJ
LQWHJUDWLRQLQWRKHSDWLFWKHUDSLHVPDQ\FKDOOHQJHVUHPDLQLQFOXGLQJWKHDELOLW\WRGLFWDWHDQG
HQKDQFHGLIIHUHQWLDWLRQSDUWLFXODUO\ZLWKLQPXOWLFHOOXODUV\VWHPV)XUWKHUPRUHUHJDUGOHVVRI
WKH FHOO VRXUFH WKH VWDELOL]DWLRQ RI KHSDWRF\WH IXQFWLRQV UHPDLQV D SULPDU\ LVVXH
0LFURHQYLURQPHQWDO VLJQDOV LQFOXGLQJ VROXEOH PHGLDWRUV FHOOH[WUDFHOOXODU PDWUL[
LQWHUDFWLRQVDQG FHOOFHOO LQWHUDFWLRQVKDYH EHHQ LPSOLFDWHGLQWKHUHJXODWLRQRIKHSDWRF\WH
IXQFWLRQ $FFRUGLQJO\ WKH GHYHORSPHQW RI UREXVW KHSDWRF\WH LQ YLWUR FXOWXUH PRGHOV WKDW
DOORZ IRU WKH FRQWUROOHG UHFRQVWLWXWLRQ RI WKHVH HQYLURQPHQWDO IDFWRUV LV D IXQGDPHQWDO
SUHUHTXLVLWHWRZDUGDWKRURXJKXQGHUVWDQGLQJRIPHFKDQLVPVUHJXODWLQJKHSDWRF\WHSURFHVVHV
DQGWKHLPSURYHGIXQFWLRQDOLW\RIOLYHUFHOOEDVHGWKHUDSLHV

,Q9LWUR+HSDWLF&XOWXUHPRGHOV

$Q H[WHQVLYH UDQJH RI OLYHU PRGHO V\VWHPV KDYH EHHQ GHYHORSHG VRPH RI ZKLFK
LQFOXGH SHUIXVHG ZKROHRUJDQV DQG ZHGJH ELRSVLHV SUHFLVLRQFXW OLYHU VOLFHV LVRODWHG
SULPDU\KHSDWRF\WHVLQVXVSHQVLRQRUFXOWXUHGRQH[WUDFHOOXODUPDWUL[LPPRUWDOL]HGOLYHUFHOO
OLQHV LVRODWHG RUJDQHOOHV PHPEUDQHV RU HQ]\PHV DQG UHFRPELQDQW V\VWHPV H[SUHVVLQJ
VSHFLILFGUXJPHWDEROLVPHQ]\PHV:KLOHSHUIXVHGZKROHRUJDQVZHGJHELRSVLHVDQGOLYHU
VOLFHVPDLQWDLQPDQ\DVSHFWVRIWKHQRUPDOLQYLYRPLFURHQYLURQPHQWDQGDUFKLWHFWXUHWKH\
W\SLFDOO\ VXIIHU IURP VKRUWWHUP YLDELOLW\  K  DQG OLPLWHG QXWULHQWR[\JHQ GLIIXVLRQ WR
LQQHUFHOOOD\HUV3XULILHGOLYHUIUDFWLRQVDQGVLQJOHHQ]\PHV\VWHPVDUHURXWLQHO\XVHGLQKLJK
WKURXJKSXW V\VWHPV WR LGHQWLI\ HQ]\PHV LQYROYHG LQ WKHPHWDEROLVPRIQHZSKDUPDFHXWLFDO
FRPSRXQGV DOWKRXJK WKH\ ODFN WKH FRPSOHWH VSHFWUXP RI JHQH H[SUHVVLRQ DQG FHOOXODU
PDFKLQHU\ UHTXLUHG IRU OLYHUVSHFLILF IXQFWLRQV ,Q DGGLWLRQ FHOO OLQHV GHULYHG IURP
KHSDWREODVWRPDV RU IURP LPPRUWDOL]DWLRQ RI SULPDU\ KHSDWRF\WHV DUHILQGLQJ OLPLWHGXVHDV
UHSURGXFLEOHLQH[SHQVLYHPRGHOVRIKHSDWLFWLVVXH

+RZHYHU VXFK OLQHV DUH SODJXHG E\ DEQRUPDO OHYHOV DQG D UHSHUWRLUH RI KHSDWLF
IXQFWLRQV SHUKDSV PRVW QRWDEO\ WKH GLYHUJHQFH RI QXFOHDU UHFHSWRU±PHGLDWHG UHJXODWLRQ RI
F\WRFKURPH 3 HQ]\PHV 7KRXJK HDFK RI WKHVH PRGHOV KDV IRXQG XWLOLW\ IRU IRFXVHG
TXHVWLRQVLQGUXJPHWDEROLVPUHVHDUFKLVRODWHGSULPDU\KHSDWRF\WHVDUHJHQHUDOO\FRQVLGHUHG

ϭϳϳ

WREHPRVWVXLWDEOHIRUFRQVWUXFWLQJLQYLWURSODWIRUPVIRUDPXOWLWXGHRIDSSOLFDWLRQV$PDMRU
OLPLWDWLRQLQWKHXVHRISULPDU\KHSDWRF\WHVLVWKDWWKH\DUHQRWRULRXVO\GLIILFXOWWRPDLQWDLQ
LQFXOWXUHGXHWRWKHSUHFLSLWRXVGHFOLQHLQYLDELOLW\DQGOLYHUVSHFLILFIXQFWLRQVRQLVRODWLRQ
IURP WKH OLYHU $FFRUGLQJO\ VXEVWDQWLDO UHVHDUFK KDV EHHQ FRQGXFWHG VLQFH WKH PLGV
WRZDUGHOXFLGDWLQJWKHVSHFLILFPROHFXODUVWLPXOLWKDWFDQPDLQWDLQSKHQRW\SLFIXQFWLRQVLQ
KHSDWRF\WHV,QVXEVHTXHQWVHFWLRQVZHSUHVHQWH[DPSOHVRIVWUDWHJLHVWKDWKDYHEHHQXVHGWR
LPSURYHWKHVXUYLYDODQGOLYHUVSHFLILFIXQFWLRQVRISULPDU\KHSDWRF\WHVLQFXOWXUH

7LVVXHHQJLQHHULQJRIXURORJLFVWUXFWXUHV

7LVVXHHQJLQHHULQJ WHFKQLTXHV DUH FXUUHQWO\ EHLQJ LQYHVWLJDWHG IRU WKH UHSODFHPHQW RI
ORVWRUGHILFLHQWJHQLWRXULQDU\VWUXFWXUHVLQFOXGLQJXUHWKUDEODGGHUPDOHDQGIHPDOHJHQLWDO
WLVVXHVXUHWHUDQGUHQDOVWUXFWXUHV

8UHWKUD

9DULRXVVWUDWHJLHVKDYHEHHQSURSRVHGWRUHJHQHUDWHXUHWKUDOWLVVXH:RYHQPHVKHVRI
3*$ZLWKRXWFHOOVKDYHEHHQXVHGWRUHFRQVWUXFWXUHWKUDVLQGRJV3*$KDVEHHQXVHGDVD
FHOOWUDQVSODQWDWLRQYHKLFOHWRHQJLQHHUWXEXODUXURWKHOLXPLQYLYR6PDOOLQWHVWLQDOVXEPXFRVD
6,6  ZLWKRXW FHOOV ZDV XVHG DV DQ RQ OD\ SDWFK JUDIW IRU XUHWKURSODVW\ LQ UDEELWV DQG D
KRPRORJRXVIUHHJUDIWRIDFHOOXODUXUHWKUDOPDWUL[ZDVDOVRXVHGLQDUDEELWPRGHO%ODGGHU
GHULYHG DFHOOXODU FROODJHQ PDWUL[ KDV SURYHQ WR EH D VXLWDEOH JUDIW IRU UHSDLULQJ XUHWKUDO
GHIHFWV LQ UDEELWV 7KH FUHDWHG QHRXUHWKUDV GHPRQVWUDWHG D QRUPDO XURWKHOLDO OXPLQDO OLQLQJ
DQGRUJDQL]HGPXVFOHEXQGOHV5HVXOWVZHUHFRQILUPHGFOLQLFDOO\LQDVHULHVRISDWLHQWVZLWK
D KLVWRU\ RI IDLOHG K\SRVSDGLDV UHFRQVWUXFWLRQ ZKRVH XUHWKUDO GHIHFWV ZHUH UHSDLUHG ZLWK
KXPDQ EODGGHU DFHOOXODU FROODJHQ PDWULFHV )LJXUH   $Q DGYDQWDJH RI WKLV PDWHULDO RYHU
QRQJHQLWDOWLVVXHJUDIWVIRUXUHWKURSODVW\LVWKDWLWLV³RIIWKHVKHOI´HOLPLQDWLQJWKHQHHGIRU
DGGLWLRQDO VXUJLFDO SURFHGXUHV IRU JUDIW KDUYHVWLQJ DQG GHFUHDVLQJ RSHUDWLYH WLPH DQG
SRWHQWLDOPRUELGLW\IURPWKHKDUYHVWSURFHGXUH


ϭϳϴ

 
)LJXUH  7LVVXHHQJLQHHUHG XUHWKUD XVLQJ D FROODJHQ PDWUL[ $  5HSUHVHQWDWLYH FDVH RI D
SDWLHQWZLWKDEXOEDUVWULFWXUH % 8UHWKUDOUHSDLU6WULFWXUHGWLVVXHLVH[FLVHGSUHVHUYLQJWKH
XUHWKUDO SODWH RQ WKH OHIW VLGH DQG PDWUL[ LV DQDVWRPRVHG WR WKH XUHWKUDO SODWH LQ DQ RQOD\
IDVKLRQ RQ WKH ULJKW &  8UHWKURJUDP VL[ PRQWKV DIWHU UHSDLU '  &\VWRVFRSLF YLHZ RI
XUHWKUDEHIRUHVXUJHU\RQWKHOHIWVLGHDQGIRXUPRQWKVDIWHUUHSDLURQWKHULJKWVLGH

7KH IRUHJRLQJ WHFKQLTXHV XVLQJ QRQVHHGHG DFHOOXODU PDWULFHV ZHUH VXFFHVVIXOO\
DSSOLHGH[SHULPHQWDOO\DQGFOLQLFDOO\IRURQOD\XUHWKUDOUHSDLUV+RZHYHUZKHQWXEXODUL]HG
UHSDLUV ZHUH DWWHPSWHG H[SHULPHQWDOO\ DGHTXDWH XUHWKUDO WLVVXH UHJHQHUDWLRQ ZDV QRW
DFKLHYHG DQG FRPSOLFDWLRQV VXFK DV JUDIW FRQWUDFWXUH DQG VWULFWXUH IRUPDWLRQ HQVXHG OH
5RX[   6HHGHG WXEXODUL]HG FROODJHQ PDWULFHV KDYH SHUIRUPHG EHWWHU WKDQ WKHLU QRQ
VHHGHG FRXQWHUSDUWV LQ DQLPDO VWXGLHV ,Q D UDEELW PRGHO HQWLUH XUHWKUDO VHJPHQWV ZHUH
UHVHFWHG DQG XUHWKURSODVWLHV ZHUH SHUIRUPHG ZLWK WXEXODUL]HG FROODJHQ PDWULFHV HLWKHU
VHHGHGRUQRQVHHGHG7KHWXEXODUL]HGFROODJHQPDWULFHVVHHGHGZLWKDXWRORJRXVFHOOVIRUPHG
QHZWLVVXHZKLFKZDVKLVWRORJLFDOO\VLPLODUWRQDWLYHXUHWKUD7KRVHZLWKRXWFHOOVOHGWRSRRU
WLVVXHGHYHORSPHQWILEURVLVDQGVWULFWXUHIRUPDWLRQ

%ODGGHU

*DVWURLQWHVWLQDO VHJPHQWV DUH FRPPRQO\ XVHG DV WLVVXHV IRU EODGGHU UHSODFHPHQW RU
UHSDLU+RZHYHUWKHVHWLVVXHVDUHGHVLJQHGWRDEVRUEVSHFLILFVROXWHVDQGZKHQWKH\FRPHLQ
FRQWDFW ZLWK WKH XULQDU\ WUDFW PXOWLSOH FRPSOLFDWLRQV PD\ HQVXH LQFOXGLQJ LQIHFWLRQ
PHWDEROLF GLVWXUEDQFHV XUROLWKLDVLV SHUIRUDWLRQ LQFUHDVHG PXFXV SURGXFWLRQ DQG
PDOLJQDQF\ %HFDXVH RI WKHVH SUREOHPV LQYHVWLJDWRUV KDYH DWWHPSWHG DOWHUQDWLYH
UHFRQVWUXFWLYH SURFHGXUHV IRU EODGGHU UHSODFHPHQW RU UHSDLU VXFK DV WKH XVH RI WLVVXH
H[SDQVLRQVHURPXVFXODUJUDIWVPDWULFHVIRUWLVVXHUHJHQHUDWLRQDQGWLVVXHHQJLQHHULQJZLWK
FHOOWUDQVSODQWDWLRQ

7LVVXH([SDQVLRQ

$ V\VWHP RI SURJUHVVLYH GLODWLRQ IRU XUHWHUV DQG EODGGHUV KDV EHHQ SURSRVHG DV D
PHWKRG RI EODGGHU DXJPHQWDWLRQ EXW KDV QRW \HW EHHQ DWWHPSWHG FOLQLFDOO\ $XJPHQWDWLRQ
F\VWRSODVW\SHUIRUPHGZLWKWKHGLODWHGXUHWHUDOVHJPHQWLQDQLPDOVKDVUHVXOWHGLQLQFUHDVHG
EODGGHU FDSDFLW\ UDQJLQJ IURP  WR  $ V\VWHP SURJUHVVLYHO\ WR H[SDQG QDWLYH
EODGGHUWLVVXHKDVDOVREHHQXVHGIRUDXJPHQWLQJEODGGHUYROXPHVLQDQLPDOV:LWKLQGD\V
DIWHU SURJUHVVLYH GLODWLRQ QHRUHVHUYRLU YROXPH ZDV H[SDQGHG DW OHDVW IROG 8URG\QDPLF
VWXGLHV VKRZHG QRUPDO FRPSOLDQFH LQ DOO DQLPDOV DQG PLFURVFRSLF H[DPLQDWLRQ RI WKH
H[SDQGHGQHRUHVHUYRLUWLVVXHFRQILUPHGDQRUPDOKLVWRORJ\$VHULHVRILPPXQRF\WRFKHPLFDO
VWXGLHV GHPRQVWUDWHG WKDW WKH GLODWHG EODGGHU WLVVXH PDLQWDLQHG QRUPDO SKHQRW\SLF
FKDUDFWHULVWLFV

6HURPXVFXODU*UDIWV

6HURPXVFXODUJUDIWVDQGGHHSLWKHOLDOL]HGERZHOVHJPHQWVHLWKHUDORQHRURYHUDQDWLYH
XURWKHOLXP KDYH DOVR EHHQ DWWHPSWHG .HHSLQJ WKH XURWKHOLXP LQWDFW DYRLGV FRPSOLFDWLRQV
DVVRFLDWHG ZLWK WKH XVH RI ERZHO LQ FRQWLQXLW\ ZLWK WKH XULQDU\ WUDFW $Q H[DPSOH RI WKLV
VWUDWHJ\ LV WR FRPELQH WKH WHFKQLTXHV RI DXWRDXJPHQWDWLRQ DQG HQWHURF\VWRSODVW\ $Q
DXWRDXJPHQWDWLRQLVSHUIRUPHGDQGWKHGLYHUWLFXOXPLVFRYHUHGZLWKDGHPXFRVDOL]HGJDVWULF
RULQWHVWLQDOVHJPHQW

ϭϳϵ

 
0DWULFHV

1RQVHHGHG DOORJHQHLF DFHOOXODU EODGGHU PDWULFHV KDYH VHUYHG DV VFDIIROGV IRU WKH
LQJURZWK RI KRVW EODGGHU ZDOO FRPSRQHQWV 7KH PDWULFHV DUH SUHSDUHG E\ PHFKDQLFDOO\ DQG
FKHPLFDOO\ UHPRYLQJ DOO FHOOXODU FRPSRQHQWV IURP EODGGHU WLVVXH 7KH PDWULFHV VHUYH DV
YHKLFOHV IRU SDUWLDO EODGGHU UHJHQHUDWLRQ DQG UHOHYDQW DQWLJHQLFLW\ LV QRW HYLGHQW )RU
H[DPSOH6,6 DELRGHJUDGDEOHDFHOOXODU[HQRJHQHLFFROODJHQEDVHGWLVVXHPDWUL[JUDIW ZDV
ILUVWXVHGLQWKHHDUO\VDVDQDFHOOXODUPDWUL[IRUWLVVXHUHSODFHPHQWLQWKHYDVFXODUILHOG
,W KDV EHHQ VKRZQ WR SURPRWH UHJHQHUDWLRQ RI D YDULHW\ RI KRVW WLVVXHV LQFOXGLQJ EORRG
YHVVHOV DQG OLJDPHQWV $QLPDO VWXGLHV KDYH VKRZQ WKDW WKH QRQVHHGHG 6,6 PDWUL[ XVHG IRU
EODGGHUDXJPHQWDWLRQFDQUHJHQHUDWHLQYLYR

,Q PXOWLSOH VWXGLHV XVLQJ YDULRXV PDWHULDOV DV QRQVHHGHG JUDIWV IRU F\VWRSODVW\ WKH
XURWKHOLDO OD\HU UHJHQHUDWHG QRUPDOO\ EXW WKH PXVFOH OD\HU DOWKRXJK SUHVHQW ZDVQRW IXOO\
GHYHORSHG2IWHQWKHJUDIWVFRQWUDFWHGWR±RIWKHLURULJLQDOVL]HVZLWKOLWWOHLQFUHDVHLQ
EODGGHU FDSDFLW\ RU FRPSOLDQFH 6WXGLHV LQYROYLQJ DFHOOXODU PDWULFHV WKDW PD\ SURYLGH WKH
QHFHVVDU\ HQYLURQPHQW WR SURPRWH FHOO PLJUDWLRQ JURZWK DQG GLIIHUHQWLDWLRQ DUH EHLQJ
FRQGXFWHG :LWK FRQWLQXHG UHVHDUFK WKHVH PDWULFHV PD\ KDYH D FOLQLFDO UROH LQ EODGGHU
UHSODFHPHQWLQWKHIXWXUH5HFHQWO\EODGGHUUHJHQHUDWLRQKDVEHHQVKRZQWREHPRUHUHOLDEOH
XVLQJ6,6GHULYHGIURPWKHGLVWDOLOHXP

&HOO7UDQVSODQWDWLRQ

&HOOVHHGHG DOORJHQHLF DFHOOXODU EODGGHU PDWULFHV KDYH EHHQ XVHG IRU EODGGHU
DXJPHQWDWLRQLQGRJV7ULJRQHVSDULQJF\VWHFWRP\ZDVSHUIRUPHGLQGRJVUDQGRPO\DVVLJQHG
WRRQHRIWKUHHJURXSV2QHJURXSXQGHUZHQWFORVXUHRIWKHWULJRQHZLWKRXWDUHFRQVWUXFWLYH
SURFHGXUHDQRWKHUXQGHUZHQWUHFRQVWUXFWLRQZLWKDQRQVHHGHGEODGGHUVKDSHGELRGHJUDGDEOH
VFDIIROGDQGWKHODVWXQGHUZHQWUHFRQVWUXFWLRQXVLQJDEODGGHUVKDSHGELRGHJUDGDEOHVFDIIROG
WKDWGHOLYHUHGVHHGHGDXWRORJRXVXURWKHOLDOFHOOVDQGVPRRWKPXVFOHFHOOV

7KHF\VWHFWRP\RQO\DQGQRQVHHGHGFRQWUROVPDLQWDLQHGDYHUDJHEODGGHUFDSDFLWLHVRI
 DQG  RI SUHRSHUDWLYH YDOXHV UHVSHFWLYHO\ FRPSDUHG ZLWK  LQ WKH FHOOVHHGHG
WLVVXHHQJLQHHUHG EODGGHU UHSODFHPHQWV )LJXUH   7KH VXEWRWDO F\VWHFWRP\ UHVHUYRLUV WKDW
ZHUH QRW UHFRQVWUXFWHG DQG WKH SRO\PHURQO\ UHFRQVWUXFWHG EODGGHUV VKRZHG D PDUNHG
GHFUHDVHLQEODGGHUFRPSOLDQFH DQGWRWDOFRPSOLDQFH 7KHFRPSOLDQFHRIWKHFHOO
VHHGHG WLVVXHHQJLQHHUHG EODGGHUV VKRZHG DOPRVW QR GLIIHUHQFH IURP SUHRSHUDWLYH YDOXHV
ZKLFK ZHUH PHDVXUHG ZKHQ WKH QDWLYH EODGGHU ZDV SUHVHQW   +LVWRORJLFDOO\ WKH
QRQVHHGHGVFDIIROG EODGGHUV SUHVHQWHGD SDWWHUQ RI QRUPDO XURWKHOLDOFHOOV ZLWK D WKLFNHQHG
ILEURWLFVXEPXFRVDDQGDWKLQOD\HURIPXVFOHILEHUV )LJXUHPLGGOHSDUFHO 7KHUHWULHYHG
WLVVXHHQJLQHHUHGEODGGHUVVKRZHGDQRUPDOFHOOXODURUJDQL]DWLRQFRQVLVWLQJRIDWULOD\HURI
XURWKHOLXPVXEPXFRVDDQGPXVFOH )LJXUHULJKWSDUFHO 3UHOLPLQDU\FOLQLFDOWULDOVIRUWKH
DSSOLFDWLRQRIWKLVWHFKQRORJ\KDYHEHHQSHUIRUPHGDQGDUHXQGHUHYDOXDWLRQ


ϭϴϬ

 
)LJXUH&RPSDULVRQRIWLVVXHHQJLQHHUHGQHREODGGHUV*URVVVSHFLPHQVDQGF\VWRJUDPVDW
 PRQWKV RI WKH F\VWHFWRP\RQO\ QRQVHHGHG FRQWUROV DQG FHOOVHHGHG WLVVXHHQJLQHHUHG
EODGGHU UHSODFHPHQWV 7KH F\VWHFWRP\RQO\ EODGGHU KDG D FDSDFLW\ RI  RI WKH
SUHRSHUDWLYH YDOXHDQGD GHFUHDVH LQ EODGGHUFRPSOLDQFH WR  RI WKH SUHRSHUDWLYH YDOXH
7KH QRQVHHGHG FRQWUROV VKRZHG VLJQLILFDQW VFDUULQJ ZLWK D FDSDFLW\ RI  RI WKH
SUHRSHUDWLYH YDOXHDQGD GHFUHDVH LQ EODGGHUFRPSOLDQFH WR  RI WKH SUHRSHUDWLYH YDOXH
$QDYHUDJHEODGGHUFDSDFLW\RIRIWKHRULJLQDOSUHF\VWHFWRP\YROXPHZDVDFKLHYHGLQ
WKH FHOOVHHGHG WLVVXHHQJLQHHUHG EODGGHU UHSODFHPHQWV DQG WKH FRPSOLDQFH VKRZHG DOPRVW
QRGLIIHUHQFHIURPSUHRSHUDWLYHYDOXHVZKLFKZHUHPHDVXUHGZKHQWKHQDWLYHVEODGGHUZDV
SUHVHQW  

*HQLWDO7LVVXHV

7LVVXHHQJLQHHULQJ WHFKQLTXHV KDYH EHHQ XVHG WR UHFRQVWUXFW PDOHDQG IHPDOH JHQLWDO
WLVVXHV

&RUSRUDO6PRRWK0XVFOH

%HFDXVH RQH RI WKH PDMRU FRPSRQHQWV RI WKH SKDOOXV LV FRUSRUDO VPRRWK PXVFOH WKH
FUHDWLRQRIDXWRORJRXVIXQFWLRQDODQGVWUXFWXUDOFRUSRUDOWLVVXHGHQRYRZRXOGEHEHQHILFLDO
7RH[DPLQHIXQFWLRQDOSDUDPHWHUVRIHQJLQHHUHGFRUSRUDDFHOOXODUFRUSRUDOFROODJHQPDWULFHV
ZHUHREWDLQHGIURPGRQRUUDEELWSHQLVDQGDXWRORJRXVFRUSXVFDYHUQRVDOVPRRWKPXVFOHDQG
HQGRWKHOLDO FHOOV ZHUH KDUYHVWHG H[SDQGHG DQG VHHGHG RQ WKH PDWULFHV 7KH HQWLUH UDEELW
FRUSRUD ZDV UHPRYHG DQG UHSODFHG ZLWK HQJLQHHUHG VFDIIROGV 7KH H[SHULPHQWDO FRUSRUDO
ERGLHV GHPRQVWUDWHG LQWDFW VWUXFWXUDO LQWHJULW\ E\ FDYHUQRVRJUDSK\ DQG VKRZHG VLPLODU
SUHVVXUH E\ FDYHUQRVRPHWU\ ZKHQ FRPSDUHG ZLWK QRUPDO FRQWUROV 7KH FRQWURO UDEELWV
ZLWKRXWFHOOV IDLOHGWRVKRZQRUPDOHUHFWLOHIXQFWLRQWKURXJKRXWWKHVWXG\0DWLQJDFWLYLW\
LQWKHDQLPDOVZLWKWKHHQJLQHHUHGFRUSRUDDSSHDUHGQRUPDOE\RQHPRQWKDIWHULPSODQWDWLRQ

ϭϴϭ

7KHSUHVHQFHRIVSHUPZDVFRQILUPHGGXULQJPDWLQJDQGZDVSUHVHQWLQDOOWKHUDEELWVZLWK
WKH HQJLQHHUHG FRUSRUD 7KH IHPDOH UDEELWV PDWHG ZLWK WKH DQLPDOV LPSODQWHG ZLWK
HQJLQHHUHG FRUSRUD DQG FRQFHLYHG DQG GHOLYHUHG KHDOWK\ SXSV $QLPDOV LPSODQWHG ZLWK WKH
PDWUL[DORQHZHUHXQDEOHWRGHPRQVWUDWHQRUPDOPDWLQJDFWLYLW\DQGIDLOHGWRHMDFXODWHLQWR
WKHYDJLQD

(QJLQHHUHG3HQLOH3URVWKHVHV

$OWKRXJK VLOLFRQH LV DQ DFFHSWHG ELRPDWHULDO IRU SHQLOH SURVWKHVHV ELRFRPSDWLELOLW\
UHPDLQV D FRQFHUQ 7KH XVH RI D QDWXUDO SURVWKHVLV FRPSRVHG RI DXWRORJRXV FHOOV PD\ EH
DGYDQWDJHRXV $ UHFHQW VWXG\ XVLQJ DQ DXWRORJRXV V\VWHP LQYHVWLJDWHG WKH IHDVLELOLW\ RI
DSSO\LQJWKHHQJLQHHUHGFDUWLODJHURGVLQVLWX$XWRORJRXVFKRQGURF\WHVKDUYHVWHGIURPUDEELW
HDUZHUHJURZQDQGH[SDQGHGLQ FXOWXUH 7KH FHOOV ZHUH VHHGHG RQWRELRGHJUDGDEOHSRO\O
ODFWLF DFLG±FRDWHG 3*$ SRO\PHU URGV DQG LPSODQWHG LQWR WKH FRUSRUDO VSDFHV RI UDEELWV
([DPLQDWLRQ DW UHWULHYDO RQH PRQWK ODWHU VKRZHG WKH SUHVHQFH RI ZHOOIRUPHG PLON\ZKLWH
FDUWLODJH VWUXFWXUHV ZLWKLQ WKH FRUSRUD $OO SRO\PHUV ZHUH IXOO\ GHJUDGHG E\ WZR PRQWKV
7KHUH ZDV QRHYLGHQFHRI HURVLRQ RU LQIHFWLRQ LQ DQ\ RIWKH LPSODQWDWLRQ VLWHV 6XEVHTXHQW
VWXGLHVDVVHVVHGWKHORQJWHUPIXQFWLRQDOLW\RIWKHFDUWLODJHSHQLOHURGVLQYLYR7RGDWHWKH
DQLPDOV KDYH GRQH ZHOO DQG FDQ FRSXODWH DQG LPSUHJQDWH WKHLU IHPDOH SDUWQHUV ZLWKRXW
SUREOHPV

)HPDOH*HQLWDO7LVVXHV

&RQJHQLWDO PDOIRUPDWLRQV RI WKH XWHUXV PD\ KDYH SURIRXQG LPSOLFDWLRQV FOLQLFDOO\
3DWLHQWVZLWKFORDFDOH[VWURSK\RULQWHUVH[GLVRUGHUVPD\QRWKDYHVXIILFLHQWXWHULQHWLVVXHIRU
IXWXUH UHSURGXFWLRQ:HLQYHVWLJDWHG WKH SRVVLELOLW\ RI HQJLQHHULQJIXQFWLRQDO XWHULQHWLVVXH
XVLQJ DXWRORJRXV FHOOV $XWRORJRXV UDEELW XWHULQH VPRRWK PXVFOH DQG HSLWKHOLDO FHOOV ZHUH
KDUYHVWHG DQG WKHQ JURZQ DQG H[SDQGHG LQ FXOWXUH 7KHVH FHOOV ZHUH VHHGHG RQWR
SUHFRQILJXUHG XWHULQHVKDSHG ELRGHJUDGDEOH SRO\PHU VFDIIROGV ZKLFK ZHUH WKHQ XVHG IRU
VXEWRWDOXWHULQHWLVVXHUHSODFHPHQWLQWKHFRUUHVSRQGLQJDXWRORJRXV DQLPDOV 8SRQ UHWULHYDO
VL[PRQWKVDIWHULPSODQWDWLRQKLVWRORJLFDOLPPXQRF\WRFKHPLFDODQG:HVWHUQEORWDQDO\VHV
FRQIL UPHG WKH SUHVHQFH RI QRUPDO XWHULQH WLVVXH FRPSRQHQWV %LRPHFKDQLFDO DQDO\VHV DQG
RUJDQEDWKVWXGLHVVKRZHGWKDWWKHIXQFWLRQDOFKDUDFWHULVWLFVRIWKHVHWLVVXHVZHUHVLPLODUWR
WKRVH RI QRUPDO XWHULQH WLVVXH %UHHGLQJ VWXGLHV XVLQJ WKHVH HQJLQHHUHG XWHUL DUH FXUUHQWO\
EHLQJSHUIRUPHG

6HYHUDOSDWKRORJLFFRQGLWLRQVLQFOXGLQJFRQJHQLWDOPDOIRUPDWLRQVDQGPDOLJQDQF\FDQ
DGYHUVHO\ DIIHFW QRUPDO YDJLQDO GHYHORSPHQW RU DQDWRP\ 9DJLQDO UHFRQVWUXFWLRQ KDV
WUDGLWLRQDOO\EHHQFKDOOHQJLQJGXHWRWKHSDXFLW\RIDYDLODEOHQDWLYHWLVVXH9DJLQDOHSLWKHOLDO
DQGVPRRWKPXVFOHFHOOVRIIHPDOHUDEELWVZHUHKDUYHVWHGJURZQDQGH[SDQGHGLQFXOWXUH
7KHFHOOVZHUHVHHGHGRQWRELRGHJUDGDEOHSRO\PHUVFDIIROGVZKLFKZHUHWKHQLPSODQWHGLQWR
QXGHPLFHIRUXSWRVL[ZHHNV,PPXQRF\WRFKHPLFDOKLVWRORJLFDODQG:HVWHUQEORWDQDO\VHV
FRQIL UPHGWKHSUHVHQFHRI YDJLQDO WLVVXH SKHQRW\SHV (OHFWULFDO ILHOG VWLPXODWLRQVWXGLHVLQ
WKH WLVVXH HQJLQHHUHG FRQVWUXFWV VKRZHG VLPLODU IXQFWLRQDO SURSHUWLHV WR WKRVH RI QRUPDO
YDJLQDO WLVVXH :KHQ WKHVH FRQVWUXFWV ZHUH XVHG IRU DXWRORJRXV WRWDO YDJLQDO UHSODFHPHQW
SDWHQWYDJLQDOVWUXFWXUHVZHUHQRWHGLQWKHWLVVXHHQJLQHHUHGVSHFLPHQVZKLOHWKHQRQVHHGHG
VWUXFWXUHVZHUHQRWHGWREHVWHQRWLF




ϭϴϮ

8UHWHU

8UHWHUDOQRQVHHGHGPDWULFHVKDYHEHHQXVHGDVDVFDIIROGIRUWKHLQJURZWKRIXUHWHUDO
WLVVXH LQ UDWV 2Q LPSODQWDWLRQ WKH DFHOOXODU PDWULFHV SURPRWHG WKH UHJHQHUDWLRQ RI WKH
XUHWHUDO ZDOO FRPSRQHQWV ,Q D PRUH UHFHQW VWXG\ QRQVHHGHG XUHWHUDO FROODJHQ DFHOOXODU
PDWULFHV ZHUH WDEXODUL]HG EXW DWWHPSWV WR XVH WKHP WR UHSODFH FP VHJPHQWV RI FDQLQH
XUHWHUVZHUHXQVXFFHVVIXO&HOOVHHGHGELRGHJUDGDEOHSRO\PHUVFDIIROGVKDYHEHHQXVHGZLWK
PRUHVXFFHVVWRUHFRQVWUXFWXUHWHUDOWLVVXHV,QRQHVWXG\XURWKHOLDODQGVPRRWKPXVFOHFHOOV
LVRODWHGIURPEODGGHUVDQG H[SDQGHG LQYLWUR ZHUHVHHGHG RQWR 3*$ VFDIIROGV ZLWK WXEXODU
FRQIL JXUDWLRQV DQG LPSODQWHG VXEFXWDQHRXVO\ LQWR DWK\PLF PLFH $IWHU LPSODQWDWLRQ WKH
XURWKHOLDOFHOOVSUROLIHUDWHGWRIRUPDPXOWLOD\HUHGOXPLQDOOLQLQJRIWXEXODUVWUXFWXUHVZKLOH
WKH VPRRWK PXVFOH FHOOV RUJDQL]HG LQWR PXOWLOD\HUHG VWUXFWXUHV VXUURXQGLQJ WKH XURWKHOLDO
FHOOV $EXQGDQW DQJLRJHQHVLV ZDV HYLGHQW 3RO\PHU VFDIIROG GHJUDGDWLRQ UHVXOWHG LQ WKH
HYHQWXDOIRUPDWLRQRIQDWXUDOXURWKHOLDOWLVVXHV7KLVDSSURDFKKDVDOVREHHQXVHGWRUHSODFH
XUHWHUVLQGRJV

5HQDO6WUXFWXUHV

'XHWRLWVFRPSOH[VWUXFWXUHDQGIXQFWLRQWKHNLGQH\LVSRVVLEO\WKHPRVWFKDOOHQJLQJ
RUJDQ LQ WKH JHQLWRXULQDU\ V\VWHP WR UHFRQVWUXFW XVLQJ WLVVXHHQJLQHHULQJ WHFKQLTXHV
+RZHYHUFRQFHSWVIRUDELRDUWLILFLDONLGQH\DUHHPHUJLQJ 6RPHLQYHVWLJDWRUV DUH SXUVXLQJ
WKHUHSODFHPHQWRILVRODWHGNLGQH\IXQFWLRQSDUDPHWHUVZLWKWKHXVHRIH[WUDFRUSRUHDOXQLWV
ZKLOHRWKHUVDUHZRUNLQJWRZDUGWKHUHSODFHPHQWRIWRWDOUHQDOIXQFWLRQE\WLVVXHHQJLQHHUHG
ELRDUWLILFLDOVWUXFWXUHV

([9LYR5HQDO8QLWV

$OWKRXJKGLDO\VLVLVFXUUHQWO\WKHPRVWSUHYDOHQWIRUPRIUHQDOUHSODFHPHQWWKHUDS\WKH
UHODWLYHO\KLJKUDWHVRIPRUELGLW\DQGPRUWDOLW\KDYHVSXUUHGLQYHVWLJDWRUVWRVHHNDOWHUQDWLYH
VROXWLRQVLQYROYLQJH[YLYRV\VWHPV7RDVVHVVWKHYLDELOLW\DQGSK\VLRORJLFIXQFWLRQDOLW\RID
FHOOVHHGHGGHYLFHWRUHSODFHWKHILOWUDWLRQWUDQVSRUWPHWDEROLFDQGHQGRFULQRORJLFIXQFWLRQV
RIWKHNLGQH\LQDFXWHO\XUHPLFGRJVUHVHDUFKHUVLQWURGXFHGDV\QWKHWLFKHPRILOWUDWLRQGHYLFH
FRPELQHG ZLWK D UHQDO WXEXODU FHOO WKHUDS\ GHYLFH FRQWDLQLQJ SRUFLQH UHQDO WXEXOHV LQ DQ
H[WUDFRUSRUHDOSHUIXVLRQFLUFXLW /HYHOVRISRWDVVLXP DQG EORRG XUHD QLWURJHQ %81  ZHUH
FRQWUROOHGGXULQJWUHDWPHQWZLWKWKHGHYLFH7KHIUDFWLRQDOUHDEVRUSWLRQRIVRGLXPDQGZDWHU
ZDV SRVVLEOH DQG DFWLYH WUDQVSRUW RI SRWDVVLXP ELFDUERQDWH DQG JOXFRVH DQG D JUDGXDO
DELOLW\ WR H[FUHWH DPPRQLD ZHUH REVHUYHG 7KHVH UHVXOWV GHPRQVWUDWHG WKH WHFKQRORJLF
IHDVLELOLW\RIDQH[WUDFRUSRUHDODVVLVWGHYLFHWKDWLVUHLQIRUFHGE\WKHXVHRISUR[LPDOWXEXODU
FHOOV

8VLQJ VLPLODU WHFKQLTXHV D WLVVXHHQJLQHHUHG ELRDUWLILFLDO NLGQH\FRQVLVWLQJ RI D
FRQYHQWLRQDO KHPRILOWUDWLRQ FDUWULGJH LQ VHULHV ZLWK D UHQDO WXEXOH±DVVLVW GHYLFH FRQWDLQLQJ
KXPDQ UHQDO SUR[LPDO WXEXOH FHOOV ZDV XVHG LQ SDWLHQWV ZLWK DFXWH UHQDO IDLOXUH LQ WKH
LQWHQVLYH FDUH XQLW ,QLWLDO FOLQLFDO H[SHULHQFH ZLWK WKH ELRDUWLILFLDO NLGQH\ DQG WKH UHQDO
WXEXOH±DVVLVW GHYLFH VXJJHVWV WKDW VXFK WKHUDS\ PD\ SURYLGH D G\QDPLF DQG LQGLYLGXDOL]HG
WUHDWPHQWSURJUDPDVDVVHVVHGE\DFXWHSK\VLRORJLFDQGELRFKHPLFDOLQGLFHV





ϭϴϯ

,Q9LYR5HQDO6WUXFWXUHV

$QRWKHU PHWKRG RI LPSURYLQJ UHQDO IXQFWLRQ LQYROYHV DXJPHQWLQJ UHQDO WLVVXH ZLWK
NLGQH\FHOOH[SDQVLRQ LQYLWURDQGVXEVHTXHQWDXWRORJRXV WUDQVSODQWDWLRQ 7KHIHDVLELOLW\ RI
DFKLHYLQJ UHQDO FHOO JURZWK H[SDQVLRQ DQG LQ YLYR UHFRQVWLWXWLRQ ZLWK WLVVXHHQJLQHHULQJ
WHFKQLTXHV KDV EHHQ H[SORUHG 0RVW UHFHQWO\ DQ DWWHPSW ZDV PDGH WR KDUQHVV WKH
UHFRQVWLWXWLRQ RI UHQDO HSLWKHOLDO FHOOV WR JHQHUDWH IXQFWLRQDO QHSKURQ XQLWV 5HQDO FHOOV
KDUYHVWHG DQG H[SDQGHG LQ FXOWXUH ZHUH VHHGHG RQWR D WXEXODU GHYLFH FRQVWUXFWHG IURP D
SRO\FDUERQDWH PHPEUDQH FRQQHFWHG DW RQH HQG WR D 6LODVWLF FDWKHWHU WHUPLQDWLQJ LQ D
UHVHUYRLU 7KH GHYLFH ZDV LPSODQWHG LQWR DWK\PLF PLFH +LVWRORJLFDO H[DPLQDWLRQ RI WKH
LPSODQWHGGHYLFHVRYHUWLPHUHYHDOHGH[WHQVLYHYDVFXODUL]DWLRQZLWKIRUPDWLRQRIJORPHUXOL
DQGKLJKO\RUJDQL]HGWXEXOHOLNHVWUXFWXUHV,PPXQRF\WRFKHPLFDOVWDLQLQJFRQILUPHGWKHUHQDO
SKHQRW\SH<HOORZIOXLGFRQVLVWHQWZLWKWKHPDNHXSRIGLOXWHXULQHLQLWVFUHDWLQLQHDQGXULF
DFLGFRQFHQWUDWLRQVZDVUHWULHYHGIURPLQVLGHWKHLPSODQW <RRHWDO )XUWKHUVWXGLHV
XVLQJ QXFOHDU WUDQVIHU WHFKQLTXHV KDYH EHHQ SHUIRUPHG VKRZLQJ WKH IRUPDWLRQ RI UHQDO
VWUXFWXUHV LQ FRZV )LJXUH   &KDOOHQJHV IDFLQJ WKLV WHFKQRORJ\ LQFOXGH WKH H[SDQVLRQ WR
ODUJHUWKUHHGLPHQVLRQDOVWUXFWXUHV



)LJXUH  &UHDWLRQ RI NLGQH\ WLVVXH IURP WKHUDSHXWLF FORQLQJ DQG WLVVXHHQJLQHHULQJ
VWUDWHJLHV $  ,OOXVWUDWLRQ RI WKH WLVVXHHQJLQHHUHG UHQDO XQLW %  5HQDO XQLW VHHGHG ZLWK
FORQHG FHOOV WKUHH PRQWKV DIWHU LPSODQWDWLRQ VKRZLQJ WKH DFFXPXODWLRQ RI XULQHOLNH IOXLG
& 7KHUHZDVDFOHDUXQLGLUHFWLRQDOFRQWLQXLW\EHWZHHQWKHPDWXUHJORPHUXOLWKHLUWXEXOHV
DQG WKH SRO\FDUERQDWH PHPEUDQH '  (OLVSRW DQDO\VHV RI WKH IUHTXHQFLHV RI 7FHOOV WKDW
VHFUHWH ,)1JDPPD DIWHU SULPDU\ DQG VHFRQGDU\ VWLPXODWLRQ ZLWK DOORJHQHLF UHQDO FHOOV
FORQHGUHQDOFHOOVRUQXFOHDUGRQRUILEUREODVWV

&HOOVXEVWUDWHVDQGVXSSRUWPDWHULDOV

7KH YDOXH RI D WLVVXH HQJLQHHULQJ FHOO VXSSRUW GHSHQGV RQ WKH LQIRUPDWLRQ DQG
VXLWDELOLW\ IRU WKH UHTXLUHG DGKHUHQW FHOO W\SH RU W\SHV 7KH LQIRUPDWLRQ SURYLGHG E\ WKH
PDWHULDOLVPRVWFRPPRQO\VLPSOHVSDWLDOFXHVSURYLGLQJVXSSRUWVXUIDFHVZLWKIRUH[DPSOH
VXIILFLHQW VSDFLQJ IRU JRRG FHOO JURZWK %LRFKHPLFDO LQIRUPDWLRQ VXFK DV VXUIDFH UHDFWLYH
JURXSV DEOH WR SURPRWH RU UHGXFH DGKHUHQFH RU WR DFWLYDWH FHOO PHPEUDQH UHFHSWRUV HJ
LQWHJULQV  FDQ EH SURYLGHG 0RUH FRPSOH[ RULHQWDWLRQDO DQG PHFKDQLFDO WHQVLRQ
FRPSUHVVLRQ RU VKHDU  LQIRUPDWLRQ FDQ EH H[SUHVVHG WKURXJK WKH VXSSRUWLQJ PDWUL[ RI WKH
FRQVWUXFW

ϭϴϰ

 7KHW\SHVRIVXSSRUWPDWHULDOVDYDLODEOHFDQEHGLYLGHGLQWRGLVFUHWHJURXSV
‡7UDGLWLRQDODELRWLFPDWHULDOVPHWDOVSODVWLFFHUDPLFV
‡%LRSURVWKHVHVQDWXUDOPDWHULDOVPRGLILHGWREHFRPHELRORJLFDOO\LQHUW
‡6\QWKHWLFUHVRUEDEOHSRO\PHUV
‡6HPLQDWXUDOPRGLILHGQDWXUDOPDWHULDOV
‡1DWXUDOSRO\PHUVSURWHLQVSRO\VDFFKDULGHV

&RPSRVLWHGHYLFHVFDQEHFRQVWUXFWHGXVLQJPRUHWKDQRQHRIWKHVHPDWHULDOV)RUWKH
SXUSRVHV RI WLVVXH HQJLQHHULQJ FRQVWUXFWV LW LV SRVVLEOH WR ODUJHO\ RPLW WKH ILUVW JURXS RI
WUDGLWLRQDO PDWHULDOV EHFDXVH WKH\ DUH QRW GHVLJQHG WR UHVRUE RU EHFRPH ELRORJLFDOO\
LQWHJUDWHGZLWKLQDUHDVRQDEOHSHULRG+HQFHFRQVWUXFWVEDVHGRQWKHVHDUHPRUHOLNHO\WREH
UHJDUGHGDVELRDFWLYH PRGLILFDWLRQV RI FRQYHQWLRQDOSURVWKHWLFLPSODQWV,QPDQ\FDVHVWKH
VDPH LV DOVR WUXH RI ELRSURVWKHWLF PDWHULDOV LQ FXUUHQW XVH 7KHVH DUH PDWHULDOV IRUPHG E\
H[WHQVLYHFKHPLFDOFURVVOLQNLQJ RIQDWXUDO WLVVXHVVXFKDV SRUFLQH KHDUW YDOYHV DQG WHQGRQ
7KH QDWLYH FROODJHQEDVHG FRQQHFWLYH WLVVXH LV VWDELOL]HG E\ JOXWDUDOGHK\GH WUHDWPHQW WR
SURGXFH QRQLPPXQRJHQLF VXEVWUDWHV ZKLFK ZLOO VXUYLYH ODUJHO\ XQFKDQJHG DW WKH
LPSODQWDWLRQVLWH IRU PDQ\ \HDUV $OWKRXJK FHOO OD\HUV DQG HYHQ QHZ FRQQHFWLYH WLVVXH FDQ
HYHQWXDOO\JURZRYHUWKHVXUIDFHRIVXFKELRSURVWKHVHVLQYLYRWKH\KDYHEHHQGHVLJQHGDQG
IDEULFDWHGSULPDULO\WRIXQFWLRQDV ORQJDVSRVVLEOHLQGHSHQGHQWO\DQGZLWKRXWPRGLILFDWLRQ
E\ VXUURXQGLQJ KRVW WLVVXHV 7KH UHVLVWDQFH WR FHOOXODU LQILOWUDWLRQ DQG UHPRGHOOLQJ RI
ELRSURVWKHVHV LV FRXQWHU WR WKH EDVLF DLPV RI WLVVXH HQJLQHHULQJ DQG ODUJHO\ GLVFRXQWV WKHLU
XVH

$ YDULHW\ RI V\QWKHWLF ELRUHVRUEDEOH PDWHULDOV DUH GHJUDGHG E\ K\GURO\VLV DQG WKHQ
SKDJRF\WRVHG 7KH DGYDQWDJH RI VXFK PDWHULDOV LV WKDW SURGXFWLRQ LV UHODWLYHO\ FKHDS DQG
HDV\LQDFRQWUROODEOHDQGUHSURGXFLEOHPDQQHUDWODUJHVFDOH'LVDGYDQWDJHVOLHLQWKHLUFHOO
FRPSDWLELOLW\ ZKLFK LV RIWHQ QRW DV JRRG DV IRU QDWXUDO SRO\PHUV DQG WKHLU GHJUDGDWLRQ
SURGXFWVZKLFKFDQKDYHXQZDQWHGFHOOXODUHIIHFWV

3RO\PHU FRPSRVLWLRQ LV FULWLFDO 9DULHWLHV LQFOXGH 3*$ 3/$ SRO\FDUERQDWH SRO\ H
FDSURODFWRQH7KHPRVWZLGHO\DSSOLHGSRO\PHUVLQWLVVXHHQJLQHHULQJDUH3*$DQG3/$DQG
FRSRO\PHU 3/*$ 7KH FRPSRVLWLRQ GLPHQVLRQV DQG IRUPDWLRQ RI WKHVH SRO\PHUV FDQ EH
DGMXVWHG WR FRQWURO WKHLU VXUYLYDO LQ YLYR VWDELOLW\  WKHLU JURVV PHFKDQLFDO SURSHUWLHV
LPSRUWDQWLQVXUJLFDOKDQGOLQJDQGLQUHSODFLQJVWUXFWXUDOIXQFWLRQ DVZHOODVWKHLUDELOLW\WR
VXSSRUWFHOOJURZWK,QWKHFDVHRI3/*$WKLVFRQWUROLVWKURXJKDGMXVWPHQWRIWKHUDWLRVRI
3/$ DQG 3*$ 3*$ LV FU\VWDOOLQH K\GURSKLOLF SRO\HVWHU W\SLFDOO\ ORVLQJ LWV PHFKDQLFDO
VWUHQJWKWKURXJKK\GURO\VLVRYHUWZRWRIRXUZHHNV,QFRQWUDVW3/$LVPRUHDPRUSKRXVDQG
K\GURSKRELF GHJUDGLQJ WR UHOHDVH ODFWLF DFLG DQG ORVLQJ PHFKDQLFDO VWUHQJWK DIWHU HLJKW
ZHHNVWKRXJKZLWKPXFKVORZHUWRWDOUHVRUSWLRQLQYLYR3*$3/$DQG3/*$KDYHEHHQ
XVHGWRVXSSRUWFHOOVLQDUDQJHRIWLVVXHHQJLQHHULQJPRGHOVLQFOXGLQJFDUWLODJHXURWKHOLXP
VPRRWKPXVFOHDQG VNLQ 7KH IRUPDW RI WKH VXSSRUW PDWHULDOLV DOVRLPSRUWDQWIRUGLIIHUHQW
7( DSSOLFDWLRQV DQG UHODWLYHO\ VLPSOH WR PRGLI\ XVLQJ WKHVH SRO\PHUV 7KH VROLG SRO\PHU
VFUHZVDQG SLQVXVHG LQRUWKRSDHGLFV DUH OHVV DSSOLFDEOH WR 7( EXW HDUO\ IRUPV RI SRO\PHU
VXWXUHVZHUHHDVLO\ZRYHQWRJLYHPHVKHVDQGEUDLGVZLWKSRURVLWLHVVXLWDEOHIRUFHOOJURZWK
1RQZRYHQ IRDPV DUH PDGH E\ LQFRUSRUDWLRQ RI VDOW FU\VWDOV LQWR WKH SRO\PHU FDVWLQJ DQG
VXEVHTXHQW GLVVROXWLRQ E\ DTXHRXV ZDVKLQJ 3RUH VL]HV DUH FRQWUROOHG E\ WKH VL]H RI WKH
VHHGHG FU\VWDOV W\SLFDOO\ EHWZHHQ  —P 7KHVH PDWHULDOV FDQ EH PRXOGHG DQG
H[WUXGHG LQWR D UDQJH RI VKDSHV LQFOXGLQJ WXEHV IRU QHUYH JXLGHV 6HPLQDWXUDO DQG QDWXUDO
VXEVWUDWHV DUH GHULYHG IURP QDWXUDO PDFURPROHFXODU SRO\PHUV RU ZKROH WLVVXHV 7KH
GLVWLQFWLRQ EHWZHHQ WKHP OLHV LQ WKH H[WHQW WR ZKLFK PDWHULDOV DUH PRGLILHG WR DFKLHYH

ϭϴϱ

DJJUHJDWLRQRUVWDELOL]DWLRQ DQGKRZPXFKWKLVOHDGVWRIUDQNGHQDWXUDWLRQ7KHPRVWFULWLFDO
DQG SHUWLQHQW WHVW IRU 7( DSSOLFDWLRQV LV WKH H[WHQW WR ZKLFK D PDWHULDO SDUWLFLSDWHV LQ WKH
QDWXUDOUHPRGHOOLQJSURFHVVZLWKORFDOFHOOV

$Q H[DPSOH RI D FKHPLFDOO\ FURVVOLQNHG SRO\VDFFKDULGH LV PDPPDOLDQ K\DOXURQDQ
VWDELOL]HG E\ EHQ]\O HVWHULILFDWLRQ RI LQFUHDVLQJ QXPEHUV RI VLGH FKDLQV +\DOXURQDQ LV D
FKDUJHG SRO\VDFFKDULGH JO\FRVDPLQRJO\FDQ  IRXQG QDWXUDOO\ DW FHOO VXUIDFHV DQG LQ WKH
H[WUDFHOOXODUPDWUL[,WLVDQLPSRUWDQWOXEULFDQWEHWZHHQJOLGLQJVXUIDFHVLQVRIWWLVVXHVDQG
KDVEHHQLPSOLFDWHGLQDUDQJHRIFHOOXODUIXQFWLRQVLQFOXGLQJDQJLRJHQHVLVDQGWLVVXHUHSDLU
7KLVDJJUHJDWHNQRZQDV+<$)) PDUNHWHGDV ODVHUVNLQΠLVSURJUHVVLYHO\PRUHVWDEOHDV
FURVVOLQNLQJLQFUHDVHVEXWOHVVRIWKHPDWHULDOLVELRORJLFDOO\QDWLYHDQGIXQFWLRQDO0DWHULDOV
FDQ EH PDGH ZLWK YDU\LQJ OHYHOV RI VXEVWLWXWLRQ DQG WKHVH VXUYLYH IRU SURJUHVVLYHO\ ORQJHU
SHULRG¶V LQ YLYR HOLFLWLQJ RQO\ PRGHVW LQIODPPDWLRQ DQG ORFDO FRQQHFWLYH WLVVXH UHVSRQVH
+<$)) KDV EHHQ GHYHORSHG IRU XVH LQ VNLQ JUDIWLQJ SDUWLFXODUO\ DV D FDUULHU IRU
NHUDWLQRF\WHV&ROODJHQVSRQJHVDUHSUHSDUHGIURPYDULRXVIRUPVRILQVROXEOHRUDJJUHJDWHG
FROODJHQ DFLG H[WUDFWHG DQG FURVVOLQNHG ZLWK DJHQWV VXFK DV FDUERGLLPLGH WDQQLF DFLG RU
GLSKHQ\OSKRVSKRU\OD]LGH6RPHRIWKHVHWUHDWPHQWVSURGXFHVXEVWUDWHVZKLFKFDQEHXWLOL]HG
E\ FHOOV LQ YLYR DQG LQ YLWUR $ PHWKRG IRU DJJUHJDWLQJ EDVHPHQW PHPEUDQH LQWR D FHOO
VXEVWUDWH WHUPHG 7\SH,97\SH,9R[ KDV EHHQ GHVFULEHG XVLQJ R[LGDWLYHO\ FURVVOLQNHG
FROODJHQ SXULILHG IURP KXPDQ SODFHQWD ,W ZDV GHVLJQHG SULQFLSDOO\ WR VXSSRUW JURZWK RI
HSLWKHOLDODQGHQGRWKHOLDOFHOOOD\HUVDQGWHVWHGIRUWKHUHSDLURIVNLQDQGGXUD

7KHPRVWQDWXUDOSRO\PHUPDWHULDOVDUHWKRVHLQZKLFKSURWHLQVWDELOL]DWLRQLVSURGXFHG
E\ GUDVWLF GHK\GUDWLRQ 7KLV PD[LPL]HV LQWHUPROHFXODU LQWHUDFWLRQ ZLWKLQ SRO\PHUV WKURXJK
FRPSOHWH UHPRYDO RI K\GUDWLRQ VKHOOV WR SURPRWH LQWLPDWH PROHFXODU SDFNLQJ 7KH PRVW
ZLGHO\ VWXGLHG RI WKHVH PDWHULDOV LV WKH FROODJHQFKRQGURLWLQ VXOIDWH DJJUHJDWH PDWHULDO
ZKLFKLVDYDLODEOHDV ,QWHJUD $UDQJHRIIRUPVKDYHEHHQWHVWHGZLWKGLIIHUHQWDGGHGPDWUL[
FRPSRQHQWV

$JJUHJDWHV RI SODVPD ILEURQHFWLQ SURGXFHG DV DOLJQHG ILEURXV PDWHULDOV DUH GHULYHG
IURP QDWLYH SURWHLQ VROXWLRQV XQGHU GLUHFWLRQDO VKHDU DQG VWDELOL]HG E\ GHK\GUDWLRQ 7KHLU
VWDELOLW\ DQG DWWDFKPHQW SURSHUWLHV FDQ EH DOWHUHG E\ WUHDWPHQW ZLWK WUDFH OHYHOV RI FRSSHU
VDOWV )RU H[DPSOH WUDFH OHYHOV RI FRSSHU GLIIHUHQWLDOO\ UHJXODWHG JURZWK DQG PLJUDWLRQ RI
6FKZDQQ FHOOV DQG ILEUREODVWV 7KLV UDLVHV WKH SRVVLELOLW\ RI SURGXFLQJ PRGLILHG VXEVWUDWHV
ZKLFK KDYH FHOO VHOHFWLYLW\ SRWHQWLDOO\ XVHIXO LQ VHJUHJDWLQJ FHOO W\SHV EHWZHHQ DQDWRPLFDO
]RQHVRUOD\HUV

7KHPRVWQDWXUDOIRUPVRIFHOOVXSSRUWDUHSRO\PHUVZKRVHDJJUHJDWLRQFDQEHDFKLHYHG
LQFXOWXUHDVLWRFFXUVLQYLYR([DPSOHVLQFOXGH0DWULJHOILEULQJOXHFROODJHQJHOVDQGVRPH
SRO\VDFFKDULGHV2IWKHSRO\VDFFKDULGHVFKLWRVDQDQGK\DOXURQDQKDYHEHHQXVHGLQWKHIRUP
RI D K\GUDWHG JHO $JDURVH JHOV DUH XVHG WR VXSSRUW D FKRQGURJHQLF SKHQRW\SH LQ
FKRQGURF\WHV 0DWULJHO LV GHULYHG IURP WXPRXU FHOOV DV D WKLFN H[WUDFHOOXODU PDWUL[
FRQWDLQLQJ W\SH ,9 FROODJHQ ODPLQLQ SURWHRJO\FDQV DQG JURZWK IDFWRUV 'HVSLWH EHLQJ D
QDWXUDOVXEVWUDWHLWVFRPSOH[ FRPSRVLWLRQDQG WXPRXU FHOO RULJLQDUHOLPLWDWLRQV7KHUHDUH
FRPPHUFLDOO\DYDLODEOHIRUPVRIILEULQJOXHRUILEULQVHDODQWGHVLJQHGIRUVXUJLFDOXVH7KHVH
DUH SUHSDUHG IURP ILEULQRJHQ DQG WKURPELQ IURP KXPDQ SODVPD VWDELOL]HG E\ D ERYLQH
SURWHDVHLQKLELWRUDSURWLQLQ2QHFRPSRVLWHIRUP1HXURSODVWFRPSULVLQJHODVWLQDQGILEULQ
KDVEHHQSURSRVHGDVDVXEVWLWXWHIRUGXUDPDWHUDQGW\PSDQLFPHPEUDQHV)LEULQPDWHULDOV
KDYHDOVREHHQXVHGDVLPSODQWDEOHJURZWKIDFWRUGHSRWVDQGDJHQWVSURPRWLQJDQJLRJHQHVLV

ϭϴϲ

IRUPLQJDVLPSOHVORZUHOHDVHGHSRWIRUWUDSSHGDJHQWV*URZWKIDFWRUGHSRWIRUPXODWLRQLQ
ILEULQVWDELOL]HV)*)DFWLYLW\

&ROODJHQ JHOV RU ODWWLFHV  ZHUH GHYHORSHG WR VWXG\ FRQWUDFWLRQ DV WKH JHO VKULQNV RU
WHQVLRQLVJHQHUDWHGE\ILEUREODVWV8QWHWKHUHGODWWLFHVVKULQNSURGXFLQJVPDOOHUDQGGHQVHU
PDWULFHV VRPHWLPHV UHJDUGHG DV WLVVXHOLNH PDWHULDOV ZKLOVW WHWKHUHG ODWWLFHV JHQHUDWH
VXEVWDQWLDOHQGRJHQRXVIRUFHV&ROODJHQJHOVKDYHEHHQVHHGHGZLWKRWKHUFHOOW\SHVVXFKDV
NHUDWLQRF\WHVDQGHQGRWKHOLDOFHOOV1XPHURXVPRGHOWLVVXHVKDYHEHHQDWWHPSWHGEDVHGRQ
FRQWUDFWHG FROODJHQ JHOV DV ELRDUWLILFLDO JUDIWV IRU VNLQ UHSODFHPHQW 7KH PRVW DGYDQFHG
DSSOLFDWLRQ LV D ELOD\HUHG WLVVXH HQJLQHHUHG DOORJUDIW $SOLJUDIΠ EDVHG RQ D ILEUREODVW
FRQWUDFWHG ODWWLFH DQG NHUDWLQRF\WH OD\HU 2ULHQWDWHG IRUPV RI FROODJHQ ODWWLFH KDYH EHHQ
GHYHORSHG WR SURYLGH VSDWLDO LQIRUPDWLRQ WR FHOOV HLWKHU PHFKDQLFDOO\ RU PRUH GHOLEHUDWHO\
XVLQJPDJQHWLFILHOGVWRSURYLGHFRQWDFWJXLGDQFHFXHV

&HOOVRXUFHV

7KHILUVWUHTXLUHPHQWIRUFHOOFXOWXUHLQDQ\7(DSSOLFDWLRQLVWRJHQHUDWHVXIILFLHQWFHOOV
WR VHHG 7KH VWDJH DW ZKLFK FHOOV DUH WR EH LQWURGXFHG LQWR WKH LPSODQW WKH DPRXQW RI
UHPRGHOOLQJ RI WKH LPSODQW VXEVWUDWH UHTXLUHG WKH GHJUHH RI IXQFWLRQ DQG WKH WLPLQJ DUH
FULWLFDO

2QHRIWKHPRVWLPSRUWDQWTXHVWLRQVZKLFKPXVWEHDGGUHVVHGLVZKHWKHUWKHVRXUFHRI
FHOOV VKRXOG EH DXWRORJRXV DOORJHQHLF RU [HQRJHQHLF 7KH XVH RI WKH SDWLHQW V FHOOV
DXWRORJRXVWUDQVSODQW LVRIWHQWKHPRVWVWUDLJKWIRUZDUGRSWLRQ$ELRSV\RIWKHDSSURSULDWH
WLVVXH LV WDNHQ IURP WKH SDWLHQW HQ]\PDWLFDOO\ GLJHVWHG RU H[SODQW FXOWXUHG DQG WKH FHOOV
JURZQ WR WKH UHTXLUHG QXPEHUV :KLOVW WKLV PHWKRG KDV WKH DGYDQWDJH RI DYRLGLQJ WKH
LPPXQHUHVSRQVHDQGWKHSRVVLEOHWUDQVIHURILQIHFWLRQLQKHUHQWLQWKHXVHRIDOORJHQHLFFHOOV
LWGRHVKDYHLWVGUDZEDFNV'HSHQGLQJRQWKHW\SHRIWLVVXHUHTXLUHGDQGWKHFRQGLWLRQRIWKH
SDWLHQW OLPLWLQJIDFWRUVKHUHLQFOXGHGLVHDVHVWDWHDQGDJHRISDWLHQW LWPD\QRWEHSRVVLEOH
WRREWDLQDGHTXDWHELRSV\PDWHULDO7KHFHOOW\SHPD\SRVHSUREOHPVIRUH[DPSOHDUWLFXODU
FDUWLODJHZKLFK KDVD UHODWLYHO\ ORZ GHQVLW\ RI FHOOVZLWKDORZPLWRWLFFDSDFLW\&RVPHWLF
LVVXHVLQIOXHQFHWKHFKRLFHRIVNLQIRUWLVVXHHQJLQHHULQJ6WXGLHVXVLQJNHUDWLQRF\WHVGHULYHG
IURPWKHVROHRIWKHIRRWLQGLFDWHWKDWWKHLPSODQWHGFHOOVUHVXPHWKHLURULJLQDOSKHQRW\SHDQG
FRQWLQXH WR SURGXFH D WKLFNHQHG HSLGHUPLV *HQHWLFDOO\ DOWHULQJ FHOOV PD\ DOOHYLDWH WKLV
SUREOHP EXWPRUH QHHGV WREHNQRZQ DERXWWKH RULJLQV DQG PDLQWHQDQFH RI WKHVH UHJLRQDO
FHOOGLIIHUHQFHVZLWKLQWLVVXHV

$OORJHQHLFVRXUFHVRIFHOOVKDYHDGYDQWDJHVRYHUDXWRORJRXVFHOOV,WFDQEHUHODWLYHO\
HDV\ WR REWDLQ KHDOWK\ GRQRU WLVVXH WKH FHOOV PD\ EH FXOWXUHG RQ D ODUJH VFDOH DW FHQWUDO
IDFWRU\  VLWHV ZLWK QRQH RI WKH WLPH FRQVWUDLQWV RI DXWRORJRXV FHOOV 7KH SURGXFW ZLOO EH
FKHDSHURIDFRQVLVWHQWTXDOLW\DQGDYDLODEOHDVDQGZKHQUHTXLUHGE\WKHSDWLHQW7KHPDMRU
SUREOHP DVVRFLDWHG ZLWK DOORJHQHLF FHOOV LV JUDIW UHMHFWLRQ 7KH OHYHO RI LPPXQH UHVSRQVH
JHQHUDWHG E\ FHOOV GLIIHUV EHWZHHQ FHOO W\SHV )RU H[DPSOH HQGRWKHOLDO FHOOV FDQ LQGXFH D
ODUJH UHDFWLRQ ZKLOVW ILEUREODVWV NHUDWLQRF\WHV DQG VPRRWK PXVFOH FHOOV DUH OHVV
LPPXQRJHQLF7KHUHDFWLRQPD\DOVREHGHSHQGHQWXSRQWKHGRQRUDJHRIWKHFHOOVXVHGDV
IHWDORUQHRQDWDOFHOOVFDQHOLFLWOLWWOHRUQRLPPXQHUHVSRQVH7KHUHKDYHEHHQPDQ\VWXGLHV
UHSRUWLQJPHWKRGVIRUUHGXFLQJWKHLPPXQRJHQLFLW\RIWUDQVSODQWHGFHOOVWKRXJKZLWKOLPLWHG
VXFFHVV7KHFXUUHQWVWUDWHJLHVLQYROYHVHJUHJDWLRQRIWKHGRQRUFHOOVIURPWKHKRVWXVLQJFHOO
HQFDSVXODWLRQWHFKQLTXHVZKLFKDOORZRQO\WKHSDVVDJHLQRIR[\JHQDQGPHWDEROLWHVDQGWKH
H[LWRIFHOOJHQHUDWHGKRUPRQHV7KHUHPXVWDOVREHVFUXSXORXVVWDJHGDQDO\VHVRIFHOOVIRU

ϭϴϳ

SRVVLEOH LQIHFWLRQV VXFK DV KHSDWLWLV +,9 DQG &-' DV ZHOO DV VFUHHQLQJ IRU SRWHQWLDO
KD]DUGVVXFKDVDEQRUPDONDU\RW\SHRUWXPRULJHQLFFDSDFLW\

*HQHWKHUDS\KDVDUROHWRSOD\LQWLVVXHHQJLQHHULQJ&HOOSRSXODWLRQVFDQEHDOWHUHGE\
DGGLQJJHQHVHLWKHUWRLQFUHDVHWKHLURXWSXWRIDFHUWDLQSURWHLQRUDGGWRWKHLUUHSHUWRLUHRI
H[SUHVVHG JHQHV ([DPSOHV LQFOXGH WKH DOWHUDWLRQ RI NHUDWLQRF\WHV WR SURGXFH
WUDQVJOXWDPLQDVHZKLFKLVGHILFLHQWLQSDWLHQWVZLWKODPHOODULFWK\RVLVDGLVILJXULQJGHUPDO
GLVRUGHU 7KH HQJLQHHUHG FHOOV ZHUH WUDQVSODQWHG LQ DWK\PLF PLFH DQG SURGXFHG D QRUPDO
HSLGHUPLV7KHWHFKQLTXHKDVDOVREHHQXVHGWRLQGXFHILEUREODVWVDQGNHUDWLQRF\WHVWRUHOHDVH
IDFWRUV WKH\ ZRXOG QRW QRUPDOO\ SURGXFH )LEUREODVWV KDYH EHHQ PDGH WR SURGXFH SURWHLQV
VXFK DV WUDQVIHUULQ IDFWRU ,; DQG IDFWRU 9,,, ,Q WKH YDVFXODU V\VWHP PRGLILHG HQGRWKHOLDO
FHOOV KDYH EHHQ XVHG WR SURGXFH DQWLWKURPERJHQLF IDFWRUV VXFK DV WLVVXH SODVPLQRJHQ
DFWLYDWRU &KRQGURF\WHV KDYH EHHQ HQJLQHHUHG WR SURGXFH DQ DQWDJRQLVW IRU ,/ D PDMRU
FDXVHRIGHJUDGDWLRQRIFDUWLODJH(&0

7KHPHWKRGRIFXOWXUHRIFHOOVIRU7(LPSODQWVZLOOGHSHQGRQWKHIXQFWLRQRIWKHFHOOV
)RUPDQ\FHOOW\SHVWKHFODVVLFDOPRQROD\HU RUHTXLYDOHQWODUJHVFDOHFXOWXUHLQUROOHUERWWOHV
RUVSLQQHUV PD\DOORZSUROLIHUDWLRQRIFHOOVEXWDOVRLQFUHDVHVWKHSRVVLELOLW\RISKHQRW\SLF
FKDQJHV0DQ\FHOOVUHYHUWWRDILEUREODVWOLNHPRUSKRORJ\DIWHUORQJWHUPPRQROD\HUFXOWXUH
HJ FKRQGURF\WHV  RU LI DOORZHG WR EHFRPH WRR FRQIOXHQW PD\ ORVH WKHLU SUROLIHUDWLYH
FDSDFLW\ HJ HQGRWKHOLDO FHOOV  7KLV FKDQJH PD\ UHVXOW LQ D ORVV RI IXQFWLRQ GXH WR WKH
LQDELOLW\ WR SURGXFH IRUH[DPSOH D FHUWDLQ KRUPRQH RU WKH FDSDFLW\WR FRQWUDFW ,W PXVW EH
DVVHVVHG ZKHWKHU WKLV DOWHUDWLRQ LV WHPSRUDU\ LH FHOOV UHYHUW WR RULJLQDO SKHQRW\SH ZKHQ
UHSODFHGLQD'IRUPDWRUXQGHUWKHLQIOXHQFHRIVROXEOHIDFWRUVLQYLYRRULIWKHFKDQJHVDUH
LUUHYHUVLEOH,QHLWKHUFDVHLWPD\EHSUHIHUDEOHWRFXOWXUHFHOOVLQDQHQYLURQPHQWVLPLODUWR
WKHLQYLYRVLWXDWLRQ

3HUIXVLRQ LV D FULWLFDO LVVXH LQ ' FXOWXUH $ QXPEHU RI IDFWRUV LQWHUDFW WR GHWHUPLQH
ZKHQQXWULHQWDQGJDVHRXVSHUIXVLRQRIDFHOOPDVVEHFRPHOLPLWLQJLQFOXGLQJ
x FHOOGHQVLW\
x PHWDEROLFUDWH
x PHDQHIIHFWLYHGLIIXVLRQGLVWDQFH FHOOWRPL[HGQXWULHQWVRXUFH 
x GHQVLW\DQGDQLVRWURS\RIGLIIXVLRQSDWKPDWHULDO

&XOWXUHPHGLXPLVH[KDXVWHGPRUHTXLFNO\E\QHDUFRQIOXHQWFXOWXUHVZKLOVWVRPHFHOO
W\SHVIRUH[DPSOHFKRQGURF\WHVVXUYLYHDWQXWULHQWOHYHOVZKLFK ZRXOGEHFULWLFDO WR RWKHU
FHOOW\SHV,QPDQ\H[SHULPHQWDOPRGHOVFHOOV HJILEUREODVWVRUFKRQGURF\WHV JURZLQORZ
GHQVLW\ ' DTXHRXV JHOV &ROODJHQ JHOV W\SLFDOO\ VWDUW DW  ZDWHU DQG WKHVH QHHG WR
FRQWUDFW WROHVVWKDQRIWKHLUVWDUWLQJYROXPHEHIRUHWKH\DSSURDFK WKHFHOO DQG PDWUL[
GHQVLWLHV RI QDWLYH WLVVXHV 'LIIXVLRQ LQWR VXFK ORZ GHQVLW\ JHOV LV UDSLG ,Q DGGLWLRQ '
FROODJHQ ODWWLFHV KDYH D UDQGRP KRPRJHQHRXV ILEULO VWUXFWXUH DOPRVW QHYHU HQFRXQWHUHG LQ
QDWLYHFROODJHQRXVWLVVXHV7KHQDWLYHWLVVXHVKDYHRUJDQL]HGDQG DOLJQHGILEURXV VWUXFWXUHV
ZKLFKZLOOSURGXFHSURQRXQFHGDQLVRWURSLFGLIIXVLRQSURSHUWLHV,QSDUWLFXODUGLIIXVLRQZLOO
EHIDUPRUHUDSLGSDUDOOHOWRUDWKHUWKDQSHUSHQGLFXODUWRDOLJQHGFROODJHQILEUHEXQGOHV$V
PDWUL[GHQVLW\DQGDOLJQPHQWDUHFKDUDFWHULVWLFVRIPDWXUHUDWKHUWKDQUHSDLUWLVVXHVSHUIXVLRQ
ZLOO EH D JUHDWHU LVVXH LQ 7( RI PDWXUH WLVVXHV 7KH SULQFLSDO PHDQV RI DGGUHVVLQJ WKLV
SUREOHPWRGDWHKDVEHHQWRLQFRUSRUDWHDIRUPRIH[WHUQDOSXPSLQJWRJHQHUDWHDIOXLGIORZ
DURXQG RU WKURXJK WKH WLVVXH FRQVWUXFW 7KURXJKRXW WKLV VHFWLRQ LW LV DVVXPHG WKDW DGHTXDWH
SHUIXVLRQRIWKHFRQVWUXFWZLOODOVRRSWLPL]HWKHUDWHRIJURZWKDQGWKHGHSRVLWLRQRI(&0
&RQWUROFXHVFDQDOVREHRSWLPL]HGE\DGGLQJJURZWKIDFWRUVDQGF\WRNLQHV([DPSOHVDUHWKH

ϭϴϴ

XVH RI PLWRJHQLF JURZWK IDFWRUV WR SURPRWH ILEUREODVW SUROLIHUDWLRQ 3'*) DQG )*)  RU
9(*)RU)*)WRRSWLPL]HHQGRWKHOLDOFHOOSUROLIHUDWLRQ6LPLODUO\UDWHVRIPDWUL[SURGXFWLRQ
PD\ EH UHJXODWHG E\ FRQWURO FXHV  VXFK DV WKH 7*)S DQG ,*) IDPLOLHV RI JURZWK IDFWRU
+RZHYHU WKH LQFRUSRUDWLRQ RI VSHFLILF JURZWK IDFWRUV LV H[WUHPHO\ FHOO V\VWHP DQG VWDJH
VSHFLILFDQGWKLVLVPDGHPRUHFRPSOH[E\WKHQHHGIRUPXOWLFRPSRQHQWFRFNWDLOV

2ULHQWDWLRQ

&HOOV UHTXLUH VSHFLILF VKDSH GLUHFWLRQDO DQG VSDWLDO FXHV IURP WKHLU HQYLURQPHQW
LQFOXGLQJ
x FRQWDFWRUVXEVWUDWHJXLGDQFH
x FKHPLFDOJUDGLHQWV
x PHFKDQLFDOFXHV

,QLWVVLPSOHVWIRUPFRQWDFWJXLGDQFHXVHVWKHWRSRJUDSKLFDOIHDWXUHVRIWKHVXEVWUDWH
7RSRJUDSKLFDO IHDWXUHV DUH PRVW IUHTXHQWO\ LQ WKH IRUP RI DOLJQHG ILEUHV RU ULGJHV RI
DSSURSULDWHGLPHQVLRQV QRUPDOO\—PIRUILEUHV &HOOW\SHVZKLFKDUHDOLJQHGLQWKLV
ZD\LQFOXGHILEUREODVWVWHQRF\WHVQHXULWHVPDFURSKDJHVDQG6FKZDQQFHOOV%LRUHVRUEDEOH
JXLGDQFHWHPSODWHVVXLWDEOHIRUWLVVXHHQJLQHHULQJDUHEDVHGRQV\QWKHWLFSRO\PHUVXEVWUDWHV
FROODJHQILEULOVDQGILEURQHFWLQ$OLJQPHQWRIFROODJHQILEULOVZLWKLQQDWLYHFROODJHQJHOVKDV
XWLOL]HGPHFKDQLFDORUPDJQHWLFIRUFHVZKLOVWWHWKHULQJSRLQWVKROHVRUGHIHFWVLQWKHJHODQG
WKHORFDOHIIHFWVRIFRQWUDFWLOHFHOOVFDQSURGXFHORFDORULHQWDWLRQ2ULHQWDWLRQRIILEURQHFWLQ
ILEUHVLQYROYHVDSSOLFDWLRQRIGLUHFWLRQDOVKHDUDVSDUWRIWKHILEUHDJJUHJDWLRQSURFHVV)LJXUH
 VKRZV D IRUP RI RULHQWDWHG ILEURQHFWLQ FDEOH ZLWK D VXUIDFH OD\HU RI DOLJQHG GHUPDO
ILEUREODVWV ZKLFK PLJUDWH UDSLGO\ DORQJ WKH VWUXFWXUH ,W LV SRVVLEOH WR XVH GLIIHUHQWLDO
DWWDFKPHQWWRVXEVWUDWHVDVDPHDQVRISURGXFLQJDOLJQPHQWLQFHOOV

7KHVSHHGRIFHOOORFRPRWLRQLVFHOOW\SHDQGVXEVWUDWHGHSHQGHQWDVGHPRQVWUDWHGE\
WKHDELOLW\WRDOWHUFHOOVSHHGRQPRUHRUOHVVDGKHVLYHVXEVWUDWHV)LEUREODVWVSHHGVRI
—PKDUHFRPPRQ ,W LVSRVVLEOHWR RSWLPL]H FHOO VSHHGVE\ VXLWDEOHGHVLJQRIWKHVXEVWUDWH
FRPSRVLWLRQ EXW D IDU JUHDWHU LPSDFW LV PDGH RQ UHFUXLWPHQW E\ RSWLPL]LQJ FHOO YHORFLW\
5DQGRP GLUHFWLRQ RI PRYHPHQW ZLOO KDYH D PLQLPDO YHORFLW\ XQWLO VRPH JXLGLQJ FXH LV
SURYLGHG ,Q WKH FDVH RI FHOO JXLGDQFH VXEVWUDWHV VXFK DV ILEURQHFWLQ ILEUH VXEVWUDWHV RU
SDWWHUQHG UHVRUWDEOF SRO\PHUV FHOO VSHHG DQG SHUVLVWHQFH RI PRWLRQ FDQ EH OLQNHG ZLWK
GLUHFWLRQDOFXHVWRRSWLPL]HWKHFHOOXODUYHORFLW\


ϭϴϵ

 
)LJXUH  6FDQQLQJ HOHFWURQ PLFURJUDSK VKRZLQJ KXPDQ GHUPDO ILEUREODVWV DOLJQHG RQ D
ILEURQHFWLQFDEOH DOLJQPHQWWRSWRERWWRP 

'HOLYHU\RIVSDWLDORUGLUHFWLRQDOFXHVWRFHOOVLQWKHIRUPRIFKHPLFDOJUDGLHQWVWKURXJK
'FRQVWUXFWVUHTXLUHVWKDWWKHFKHPLFDODJHQWQRWRQO\VWLPXODWHVWKHFHOOIXQFWLRQEXWDOVR
WKDW LW LV SUHVHQWHG WR FHOOV DV D GLUHFWLRQDO JUDGLHQW $ QXPEHU RI JURZWK IDFWRUV DUH
FKHPRWDFWLF DQG FHUWDLQ H[WUDFHOOXODU PDFURPROHFXOHV VXFK DV ILEURQHFWLQ DQG FROODJHQ
SURGXFH FKHPRWDFWLF IUDJPHQWV RQ EUHDNGRZQ 6XFK GLIIXVLEOH DJHQWV FDQ EH LPSRUWDQW LQ
WLVVXH RUJDQL]DWLRQ $QJLRJHQHVLV IRU H[DPSOH LV EDVHG RQ WKH FRQFHSW WKDW QHZ YHVVHOV
PRYHDORQJJUDGLHQWVRIGLIIXVLEOHIDFWRUV7KHVHFDQEHWRZDUGVVLWHVRIORZR[\JHQWHQVLRQ
RU KLJK ODFWDWH FRQFHQWUDWLRQ RU WRZDUGV ORFDO VRXUFHV RI JURZWK IDFWRU SURGXFWLRQ )RU
H[DPSOHYDVFXODUHQGRWKHOLDOFHOOJURZWKIDFWRU 9(*) RU)*)RUPDWUL[FRPSRQHQWVVXFK
DV ROLJRVDFFKDULGH IUDJPHQWV RI K\DOXURQDQ LQIOXHQFH DQJLRJHQHVLV :KLOVW VXFK JUDGLHQWV
PD\ EH XVHIXO LQ VSHFLDO FLUFXPVWDQFHV WKHLU XVH LQ FRQWURO RI DUFKLWHFWXUH LV OLNHO\ WR EH
OLPLWHGLQYLWUR7KHPRVWSODXVLEOHFLUFXPVWDQFHVZRXOGEHIRU
 &RQWURORYHUVKRUWUDQJHV HJEHWZHHQGLVWLQFWFHOOOD\HUVLQDWLVVXHFRQVWUXFW 
 'XULQJHDUO\VWDJHVRIPDWUL[GHYHORSPHQWDQGPDWXUDWLRQ

8VHRIK\GUDWHG'PDWULFHVIRUVXSSRUWRIFXOWXUHGFHOOVEDVHGRQFROODJHQILEULQRU
ILEURQHFWLQLVKHOSIXOLQPLQLPL]LQJFRQYHFWLRQPL[LQJRIJUDGLHQWV+RZHYHUDVGLVFXVVHG
HDUOLHU WKHUH DUH OLNHO\ WR EH PDMRU SUDFWLFDO GLIILFXOWLHV LQ SURGXFLQJ DQG PDLQWDLQLQJ
HIIHFWLYH JUDGLHQWV LQ D FRQWUROOHG PDQQHU DV WKH PDWUL[ EHFRPHV G\QDPLF GHQVH DQG
DQLVRWURSLF

0HFKDQLFDOFXHV

$ ZLGH UDQJH RI FHOO W\SHV DUH VHQVLWLYH WR PHFKDQLFDO ORDGLQJ 7KH PHFKDQLVPV E\
ZKLFKFHOOVUHVSRQGWRPHFKDQLFDOVLJQDOVDUHFRPSOH[DQGLQFOXGHPRGXODWLRQRIF\WRVROLF
IUHH FDOFLXP VWUHWFKVHQVLWLYH LRQ FKDQQHOV DQG GHIRUPDWLRQ RI F\WRVNHOHWDO RU LQWHJULQ
FRPSRQHQWV5HVSRQVHVFDQLQFOXGHFKDQJHVLQFHOODOLJQPHQWV\QWKHVLVRIDFWLYHUHJXODWRU\
PROHFXOHVVXFKDVJURZWKIDFWRUVRUKRUPRQHVDOWHUHGPDWUL[V\QWKHVLVDQGHQ]\PHUHOHDVH
7KHUHDUHDWOHDVWWKUHHGLIIHUHQWIRUPVRI PHFKDQLFDOFXHWHQVLRQFRPSUHVVLRQDQGVKHDU
)LEUREODVWV DUH QRUPDOO\ FRQVLGHUHG LQ WHUPV RI WHQVLRQDO IRUFHV YDVFXODU HQGRWKHOLDO FHOOV
SUHGRPLQDQWO\ XQGHU IOXLG VKHDU DQG FKRQGURF\WHV DUH DGDSWHG WR FRPSUHVVLRQ IRUFHV ,W LV
SRVVLEOH WR IXUWKHU GLIIHUHQWLDWH HDFK RI WKHVH IRUPV RI PHFKDQLFDO FXH IRU H[DPSOH LQWR

ϭϵϬ

F\FOLFDODQGVWDWLFIRUFHRURQWKHEDVLVRIORDGLQJ YHORFLW\+RZHYHURXUXQGHUVWDQGLQJRI
WKHHIIHFWVRIWKHVHIRUPVRIORDGLQJRUWKHLUFRPELQDWLRQVLVOLPLWHG



)LJXUH6FKHPDWLFLOOXVWUDWLRQRIILEUREODVWDOLJQPHQWSURGXFHGLQFROODJHQJHOVE\
XQLD[LDOORDGLQJ6WUDLQZDVDOLJQHGSDUDOOHOZLWKWKHORQJD[LVRIWKHJHO DQGDSSOLHGORDGLQ
]RQH DQGFHOOVKHUHWRRNRQDQHORQJDWHELSRODUPRUSKRORJ\SDUDOOHOWRWKHVWUDLQ6WUDLQ
LQ]RQHZDVSRRUO\DOLJQHG UHSUHVHQWHGE\WKHGDUNWULDQJOH GXHWRWKHVKLHOGLQJHIIHFWRI
WKHULJLGVXSSRUWEDUVDQGFHOOVKHUHZHUHVWHOODWHLQVKDSHVKRZLQJQRDOLJQPHQW

$IXUWKHUDQGSRWHQWLDOO\FULWLFDOFRPSOH[LW\LVWKDWPHFKDQLFDOVWLPXOLXVHGLQLQYLWUR
H[SHULPHQWDOPRGHOVIUHTXHQWO\KDYHOLWWOHRUQRGLUHFWLRQDOFRPSRQHQW6\VWHPVZKLFKJLYH
HLWKHUQRQRULHQWDWHG RU KLJKO\ FRPSOH[ PXOWLSOH GLUHFWLRQFXHVFDQJLYHOLWWOHLQIRUPDWLRQ
RQ WKH FRQWURO RI DUFKLWHFWXUH DQG WLVVXH SRODULW\ 7KH\ DUH YDOXDEOH SULPDULO\ IRU
LQYHVWLJDWLRQ RI WKH UROH RI PHFKDQLFDO IRUFHV RQ WLVVXH SURGXFWLRQ WXUQRYHU DQG
FRPSRVLWLRQ$QXPEHURIVKHDUIRUFHPRGHOVDUHEHLQJGHYHORSHGIRUWLVVXHHQJLQHHULQJRI
WXEH WLVVXHV VXFK DV EORRG YHVVHOV )OXLG VKHDU IRUFHV KDYH EHHQ IRXQG WR RSHUDWH WKURXJK
F\WRVNHOHWDOFKDQJHV FHOOFHOO DGKHVLRQ VLWHV DQG SURWHLQNLQDVHDQG*SURWHLQVLJQDOOLQJLQ
YDVFXODU HQGRWKHOLDO FHOOV 7KHVH SDWKZD\V DUH UHSRUWHG WR DIIHFW KHDW VKRFN SURWHLQ
SKRVSKRU\ODWLRQ &X=Q VXSHUR[LGH GLVPXWDVH DFWLYLW\ DQG DSRSWRVLV $OWHUDWLRQ RI
H[WUDFHOOXODUPDWUL[SURGXFWLRQDQGFHOOVKDSHDQGDOLJQPHQWDUHPRUHOLNHO\WREHLPSRUWDQW
IRUPLFURDUFKLWHFWXUHFRQWUROFXHV&XUUHQWH[DPSOHVRIWLVVXHHQJLQHHUHGWXEHVWUXFWXUHVIRU
XVHLQIOXLGGUDLQDJHDUHELRDUWLILFLDOEORRGYHVVHOVDQGEODGGHU

7KHDELOLW\RIILEUREODVWVWREHFRPHRULHQWDWHGDORQJDXQLD[LDOPHFKDQLFDOORDGDIIHFWV
WKHLUSDWWHUQRIPDWUL[UHPRGHOOLQJ6LPLODURULHQWDWLRQVKDYHEHHQUHSRUWHGLQORDGHGVNHOHWDO
PXVFOHFHOOV0XOWLD[LDOFRPSOH[ORDGLQJSDWWHUQVSURGXFHGE\WKHIOH[FHOODQDO\WLFDOPRGHO
SURGXFHV FRPSOH[ FHOO DOLJQPHQWV ZKLFK DUH GLIILFXOW WR LQWHUSUHW WKRXJK FROODJHQ
SURGXFWLRQ LV TXDQWLWDWLYHO\ LQFUHDVHG E\ ORDGLQJ ,Q XQLD[LDO F\FOLFDOO\ ORDGHG FROODJHQ
ODWWLFHV ILEUREODVWV WDNH RQ DQ DOLJQPHQW SDUDOOHO ZLWK WKH PD[LPXP VWUDLQ LQGXFHG LQ WKH
PDWHULDODWDQ\JLYHQORFDWLRQ7KLVKDVEHHQXVHGLQRQHH[SHULPHQWDOPRGHOWRLGHQWLI\WZR
GLVWLQFW]RQHVRIPHFKDQLFDOORDGLQJLQWKHVDPHJHO )LJXUH 

0RVW VWXGLHV RI FRPSUHVVLRQDO ORDGLQJ KDYH XVHG FKRQGURF\WHV LQ D ' DJDURVH JHO
PDWUL[ RU ZKROH FDUWLODJH 7KH DJDURVH PDWUL[ SURYLGHV OLWWOH RU QR DWWDFKPHQW XQWLO
FKRQGURF\WHVKDYHHODERUDWHGWKHLURZQSHULFHOOXODUPDWUL[,QDGGLWLRQDJDURVHLVHVVHQWLDOO\
KRPRJHQHRXV LQ VWUXFWXUH SURYLGLQJ XQLIRUP PHFKDQLFDO VXSSRUW LQ DOO GLPHQVLRQV
&RQVHTXHQWO\ QHZO\ V\QWKHVL]HG PDWUL[ LV HDVLO\ GHWHFWHG DQG DSSOLHG ORDGV DFW XQLIRUPO\
DQGSUHGLFWDEO\RQPRVWFHOOV,QFRQWUDVWFDUWLODJHLQRUJDQFXOWXUHFRQWDLQVFHOOVLQDQRQ
KRPRJHQHRXVPDWUL[ZLWKPHFKDQLFDOO\GLVWLQFW]RQHV

ϭϵϭ

5HIHUHQFHV

$KPHG=$  3K'WKHVLV8QLYHUVLW\&ROOHJH/RQGRQ
$KPHG=$DQG%URZQ5$  &HOO0RWLO&\WRVNHO
$KPHG=%ULQGHQ$+DOO6DQG%URZQ5$6WDELOLVDWLRQRIODUJHILEURQHFWLQFDEOHV
ZLWKPLFURPRODUFRQFHQWUDWLRQVRIFRSSHUFHOOVXEVWUDWHSURSHUWLHV LQSUHSDUDWLRQ 
$KPHG=,GRZX%'DQG%URZQ5$  %LRPDWHULDOV
$OL 6 < (YDQV / DQG 5DOSKV - 5   ,Q &HOO PHGLDWHG FDOFLILFDWLRQ DQG PDWUL[
YHVLFOHV HG6<$OL S([FHUWD0HGLFD$PVWHUGDP
$QGUHDVVL/&DVLQL/7UDEXFFKL(HWDO  :RXQGV
$QVVHOLQ$')LQN7DQG'DYLHV')  1HXURSDWKRO$SSO1HXUGELRO
$WDOD$  ,Q)URQWLHUVLQWLVVXHHQJLQHHULQJ HG&:3DWULFN$*0LNRVDQG/9
0F,QWLUH S3HUJDPRQ3UHVV2[IRUG
$WDOD$)UHHPDQ059DFDQWL-36KHSDUG DQG5HWLN$%  -8URO

$WDOD$9DFDQWL-33HWHUV&$0DQGHOO-5HWLN$%DQG)UHHPDQ05  -
8URO
%DURFDV9+DQG7UDQTXLOOR57  -%LRPHFK(QJ
%DVFKRQJ:6XWWHUOLQ5DQG$HEL8  %XU-&HOO%LRO
%HOO(  -&HOO(QJ
%HOO(,YHUVRQ%DQG0HUULOO&  3URF1RWO$FDG6FL86$
%HOO(6KHU6DQG+XOO%  6FDQQLQJ6HFW0LFURVF
%HQHGHWWL/&RUWLYR5%HUWL7%HUWL$3HD)0D]]R0HWDO  %LRPDWHULDOV

%RQ]RQ 1 &DUUDW ; 'HPLQLHUH & 'DFXOVL * /HIHEYUH ) DQG 5DEDXG 0  
%LRPDWHULDOV
%URXKD;'57DODV*%URZQ5$DQG3RUWHU5$3UHSDUDWLRQDQGVORZUHOHDVHRI
SKHQ\WRLQ IURP DQ LPSODQWDEOH GUXJ GHSRW XVLQJ D ILEURQHFWLQ PDW FDUULHU LQ
SUHSDUDWLRQ 
%URZQ/)<HR.7%HUVH%HWDO  -([S0HG
%URZQ5$DQG-RQHV./  (XU-([S0XVFXORVNHO5HV
%URZQ5$%OXQQ*:DQG(MLP26  %LRPDWHULDOV
%URZQ5$3UDMDSDWL50F*URXWKHU'$<DQQDV,9DQG(DVWZRRG0  -
&HOO3K\VLR/
%URZQ5$6PLWK.'DQG0F*URXWKHU'$  :RXQG5HSDLU5HJHQ
%URZQ5$7DODV*3RUWHU5$0F*URXWKHU'$DQG(DVWZRRG0  -&HOO
3K\VLRO
%URZQ5$7HUHQJKL*DQG0F)DUODQG&',Q7KHQHZDQJLRWQHUDS\ HG73')DQ
DQG5$XHUEDFK +XPDQD3UHVV,QF7RWRZD1-86$ LQSUHVV 
%URZQ 5 ( (UGPDQQ ' /\RQV 6 ) DQG 6XFK\ +   - 5HFRQVWU 0LFURVXUJ

%XUWRQ:XUVWHU 1 9HUQLHU6LQJHU 0 )DUTXKDU 7 DQG /XVW *   - 2UWKRS5HV

%XVKPDQQ0' *OX]EDQG<$ *URG]LQVN\$-DQG+XQ]LNHU (%   - &HOO
6FL
%XWW53/DXUHQW*-DQG%LVKRS-(  $QQ1<$FDG6G
&DPSRFFLD'+XQW-$'RKHWHU\3-=KRQJ632 5HJDQ0%HQHGHWWL /HWDO
 %LRPDWHULDOV
&KDPEHUODLQ / - DQG <DQQDV , 9   ,Q 7LVVXH HQJLQHHULQJ PHWKRGV DQG SURWRFROV
HG-50RUJDQDQG0/<DUPXVK S+XPDQD3UHVV1HZ-HUVH\

ϭϵϮ

&KLTXHW0(SSHQEHUJHU+0DQG7XUQHU'&  'HY%LRO
&KYDSLO0  -%LRPHG0DWHU5HV
&ODUN3&RQQROO\3&XUWLV$6'RZ-$DQG:LONLQVRQ&'  @&HOO6FL

&RKQ/+  &KHVW
&RPSWRQ&&1DGLUH.%5HJDXHU6HWDO  'LIIHUHQWLDWLRQ
&XUWLV$6*DQG9DUGH0  -1DWO&DQFHU,QVW
&XUWLV$6*DQG:LONLQVRQ&'  %LRPDWHULDOV
&XUWLV$6*:LONLQVRQ&'DQG:RMFLDN6WRWKDUG%  -&HOO(QJ
'DLIRWLV$*:HLU)&'UH\HU%)DQG%URDGXV$(  -%LRO&KHP

'DYLHV3)  3K\VLRO5HY
'H9ULHV+-&0LGGOHNRRS(0HNNHV-5'XWULHX[53:LOGHYXXU&+5DQG
:HVWHUKRI:  :RXQG5HSDLU5HJHQ
'LFNLQVRQ5%*XLGR6DQG7UDQTXLOOR57  $QQ%LRPHG(QJ
'LPLOOD3$6WRQH-$4XLQQ-$$OEHOGD60DQG/DXIIHQEXUJHU'$  -
&HOO%LRO
'LPPHOHU6$VVPXV%+HUPDQQ&+DHQGHOHU-DQG=HLKHU$0  &LUF5HV

'RLOORQ&-6LOYHU)+DQG%HUJ5$  %LRPDWHULDOV
'RRODEK9%+HUWO0&DQG0DFNLQQRQ6(  5HY1HXURO
(DJOVWHLQ:+$OYDUH]0$XOHWWD0HWDO  'HUPDWRO6XUJ
(DVWZRRG 0 0XGHUD 9 & 0F*URXWKHU ' $ DQG %URZQ 5 $   &HOO 0RWLO
&\WRVNHO
(DVWZRRG03RUWHU5.DKQ80F*URXWKHU*DQG%URZQ5  -&HOO3K\VLRO

(MLP26%OXQQ*:DQG%URZQ5$  %LRPDWHULDOV
(OVGDOH7DQG%DUG-  -&HOO%LRO
(QJHOEHUJ,DQG.RKQ-  %LRPDWHULDOV
)DODQJD90DUJROLV'$OYDUH]2HWDO  $UFK'HUPDWRO
)DYDUR * %RUWRODPL 0 & &HUHVHU 6 3DVWRUHOOR ' $ &DOOHJUDR / DQG )LRL 0 *
 7UDQV$P6RF$UWLI,QWHUQ2UJDQV
)RXUQLHU1DQG'RLOORQ&-  %LRPDWHULDOV
)UHHG/(9XQMDN1RYDNRYLF*%LURQ5-HWDO  %LRWHFKQRORJ\
)UHL9+XF$DQG+HUEDJH'  -%LRPHG0DWHU5HV
)ULPDQ5*LDFFRQH* .DQHPRWR70DUWLQ* 5 *D]GDU $ )DQG 0XOVKLQH-/
 3URF1DWO$FDG6UL86$
)XUQLVK(-DQG6FKPLGW&(  ,Q)URQWLHUVLQWLVVXHHQJLQHHULQJ HG&:3DWULFN
$*0LNRVDQG/90F,QWLUH S3HUJDPRQ3UHVV2[IRUG
*HSSHUW7'DQGOLSVN\3(  -,PPXQRO
*ULQQHOO)  -&HOO%LRO
*XLGR6DQG7UDQTXLOOR57  -&HOO6FL
*XLGR6DQG7UDQTXLOOR57  -&HOO6G
+DGORFN7(OLVVHHII-/DQJHU59DFDQWL-DQG&KHQH\0  $UFK2WRODU\QJRO
+HDG1HFN6XUJ
+DQVEURXJK-)&RRSHU0/&RKHQ5HWDO  6XUJHU\
+DQWKDPURQJZLW05HLG:+DQG*UDQW0+  %LRPDWHULDOV
+HLMPHQ ) + GX 3RQW - 6 0LGGOHNRRS ( .UHLV 5 : DQG +RHNVWUD 0 -  
%LRPDWHULDOV
+HLPEDFK'/XWHUPDQ$%XUNH-HWDO  $QQ6XUJ

ϭϵϯ

+HOPLQJHU * *HLJHU 5 6FKUHFN 6 DQG 1HUHP 5   $60( - %LRPHFK (QJ

+REVRQ 0 / %URZQ 5 $ *UHHQ & - DQG 7HUHQJKL *   %U - 3ODVWLF 6XUJ

+RHEHQ5&)DOODX[)-YDQ7LOOEXUJ1+HWDO  +XP*HQH7KHQ
+XEHU05HWWOHU7%HUQDVORQL.HWDO  6FLHQFH
,JQRW]5$DQG0DVVDJXH-  -%LRO&KHP
,QRXH15DPDVDP\6)XNDL71HUHP50DQG+DUULVRQ'*  &LUF5HV

,VKLKDUD 7 )HUUDQV 9 - -RQHV 0 %R\FH 6 : DQG 5REHUWV : &  
$P-&DUGLRO
-DFNVRQ'$  ,Q&ROODJHQLQKHDOWKDQGGLVHDVH HG-%:HLVVDQG0-D\VRQ S
&KXUFKLOO/LYLQJVWRQH(GLQEXUJK
.DLQ+/DQG5HXWHU8  *UDHIV$UFK&OLQ([S2SKWKDOPRO
.LP<-%RQDVVDU/-DQG*URG]LQVN\$-  -%LRPHFK
.RLGH02VDNL..RQLVKL-HWDO  -%LRPHG0DWHU5HV
.RORGQH\06DQG:\VROPHUVNL5%  -&HOO%LRO
/DLWLQHQ7RUPDOD37DXULR3HWDO  %LRPDWHULDOV
/DQJHU5DQG9DFDQWL-3  6FLHQFH
/DQJHU5DQG9DFDQWL-3  6UL$P
/DQ]D536RORPRQ%$0RQDFR$3HWDO  ,Q3DQFUHDWLFLVOHWWUDQVSODQWDWLRQ
9RO,,, HG53/DQ]DDQG:/&KLFN S5*/DQGHV&R$XVWLQ
/DTXHUULHUH$<XQ-7RLOOLHU-+HPHW-DQG7DGLH0  -1HXURVXUJ
/DUVHQ1(3ROODN&75HLQHU . /HVKLQHU (DQG%DOD]V($  -%LRPHG
0DWHU5HV
/DXIIHQEXUJHU'$DQG+RURZLW]$)  &HOO
/HH'$DQG%DGHU'/  ,Q9LWUR&HOO'HY%LRO$QLP
/HYHVTXH0-DQG1HUHP50  -%LRPHFK(QJ
/ +HXUHX[13DTXHW6/DEEH5*HUPDLQ/DQG$XJHU)$  )$6(%-
/L 6 3LRWURZLF] 5 6 /HYLQ ( * 6K\\ < - DQG &KLHQ 6   $P- 3K\VLRO
&
/XQGERUJ*  1HUYHLQMXU\DQGUHSDLUS&KXUFKLOO/LYLQJVWRQH(GLQEXUJK
0D 3 ; DQG /DQJHU 5   ,Q 7LVVXH HQJLQHHULQJ PHWKRGV DQG SURWRFROV HG - 5
0RUJDQDQG0/<DUPXVK S+XPDQD3UHVV7RWRZD1-
0DOHN$0DQG,]XPR6  &HOO6FL
0DUNLQ96DQG7VRQJ7<  -%LRSK\V
0DVW%$)ORRG/&+D\QHV-+HWDO  0DWUL[
0RODQGHU+2OVVRQ<(QJNYLVW2%RZDOG6DQG(ULNVVRQ,  0XVFOH1HUYH

0RRQH\'-0D]]RQL&/%UHXHU&HWDO  %LRPDWHULDOV
0RUJDQ-5%DUUDQGRQ<*UHHQ+DQG0XOOLJDQ5&  6FLHQFH
0RUJRQ$'LVDQW)DQG7UX\(  $FWD2WRODU\QJRO
0RULJL0=RMD&)LJOLX]]L0HWDO  %ORRG
0XGHUD9&3OHDVV5(DVWZRRG07DUQX]]HU56FKXOW]*.KDZ30F*URXWKHU
'$DQG%URZQ5$0ROHFXODUUHVSRQVHVRIKXPDQGHUPDOILEUREODVWVWRGXDOFXHV
FRQWDFWJXLGDQFHDQGPHFKDQLFDOORDG  &HOO0RWLOLW\&\WRVNHO
0XUDVKLWD71DND\DPD<+LUDQR7DQG2KDVKL6  %U-3ODVW6XUJ
1HUHP50$OH[DQGHU5:&KDSSHOO'&0HGIRUG509DUQHU6(DQG7D\ORU
:5  $P-0HG6FL

ϭϵϰ

1LPQL0(&KHXQJ'76WUDWHV%.RGDPD0 DQG6KHLNK.  ,Q&ROODJHQ
HG0(1LPQL 9RO,,,S&5&3UHVV%RFD5DWDQ
1REOH 3 0 /DNH ) 5 +HQVRQ 3 0 DQG 5LFKHV ' :   - &OLQ ,QYHVW 

1RXJKWRQ*0DQVEULGJH-DQG*HQW]NRZ*  $UWLI2UJDQV
2EHUSHQQLQJ)0HQJ-<RR--DQG$WDOD$  1DWXUH(LRWHFKQRO
2KDWD+6HLWR1$L]DZD+1REH.DQG0RPRVH.  %LRFKHP%LRSK\V5HV
&RPPXQ
2KQR0&RRNH-3']DX9-DQG*LEERQV*+  -&OLQ,QYHVW
2OGH'DPLQN/+'LMNVWUD3-YDQ/X\HQ0-YDQ:DFKHP 3%1LHXZHQKLV3
DQG)HLMHQ-  %LRPDWHULDOV
2OR\HGH$)ODVFKPDQQ5DQG%URRP1'  &RQQHFW7LVVXH5HV
3DQGLW$6)HOGPDQ'6&DXOILHOG-DQG7KRPSVRQ$  *URZWK)DFWRUV 

3DSDGDNL0DQG(VNLQ6*  %LRWHFKQRO3URJ
3DUVRQV 0 %LVKRS - ( /DXUHQW * - (DVWZRRG 0 DQG %URZQ 5 $ 0HFKDQLFDO
ORDGLQJ RI FROODJHQ JHOV VWLPXODWHV GHUPDO ILEUREODVW FROODJHQ V\QWKHVLV DQG
UHRUJDQLVDWLRQ-,QYHVW'HUPDWRO LQSUHVV 
3DWULFN$*0LNRVDQG/0F,QWLUH S3HUJDPRQ3UHVV2[IRUG
3HWHUVHQ.33HWHUVHQ&0DQG3RSH(-  3URF6RF([S%LRO0HG
3HWHUVHQ0-.DSODQ--RUJHQVRQ&0HWDO  -,QYHVW'HUPDWRO
3HW]ROGW-//HLJK,0'XII\3*DQG0DVWHUV-5:  8URO5HV
3LOFKHU%..LP':&DUQH\'+DQG7RPDVHN--  ([S&HOW5HV 

3REHU-6&ROOLQV7*LPEURQH0$HWDW  1DWXUH
3RUWHU5$%URZQ5$(DVWZRRG02FFOHVWRQ1/DQG.KDZ37  :RXQG
5HSDLU5HJHQ
3RUWHU5$%URZQ5$(DVWZRRG02FFOHVWRQ1/DQG.KDZ37  :RXQG
5HSDLU5HJHQ
3RVWOHWKZDLWH$(.HVNL2MD-%DODLQ*HWDO  -([S0HG
3RVWOHWKZDLWH$(6H\HU-0 DQG.DQJ$+   3URF 1DWO $FDG 6G86$ 

3UDMDSDWL57$O$QL66PLWK3-DQG%URZQ5$  &HOO(QJ
3UDMDSDWL 5 7 (DVWZRRG 0 DQG %URZQ 5 $ 0HFKDQLFDO IDFWRUV UHJXODWLQJ SURWHDVH
SURGXFWLRQE\ILEUREODVWVLQGLPHQVLRQDOFROODJHQODWWLFHV VXEPLWWHG 
3XWQDP$-DQG0RRQH\'-  1DWXUH0HG
4XLQQ70*URG]LQVN\$-%XVKPDQQ0'.LP<-DQG+XQ]LNHU(%  -
&HOO6FL
51  %U-8URO
5DXOW/)UHL9+HUEDJH'$EGXO0DODN1DQG+XF$  -0DWHU6UL0DWHU
0HG
5KHLQZDOG-*DQG*UHHQ+  &HOO
5RPDQ\VK\Q / $ :LFKPDQQ - . .XFKDUF]\N . 6KXPDNHU 5 & :DUG ' DQG
6RILD5'  7KHU'UXJ0RQLW
5R\)'H%ORLV&DQG'RLOORQ&-  -%LRPHG0DWHU5HV
6DEEDJK:0DVWHUV-5'XII\3*+HUEDJH'DQG%URZQ5$  %U-8URO

6DQ*DOOL)'HPLQLHUH&*XHULQ-DQG5DEDXG0  %LRPDWHULDOV
6FKQLWWOHU+-3XVFKHO%DQG'UHQFNKDKQ'  $P-3K\VLRO+
6FRWW5*RUKDP6'$LWFKHVRQ0%UDPZHOO36SHDNPDQ-DQG0HGGLQJV

ϭϵϱ

6KLQDJO50*XUVNLV'&KHQ$&DQG6DK5/  -2UWKRS5HV
6KLQDJO507LQJ0.3ULFH-+DQG6DK5/  $QQ%LRPHG(QJ
6KLULQVN\93$QWRQRY$6.RQVWDQWLQ*HWDO  -&HOO%LRO
6KRUWNURII6DQG6SHFWRU0  ,Q7LVVXHHQJLQHHULQJPHWKRGVDQGSURWRFROV HG-5
0RUJDQDQG0/<DUPXVK S+XPDQD3UHVV1HZ-HUVH\
6LOYHU ) +   %LRPDWHULDOV PHGLFDO GHYLFHV DQG WLVVXH HQJLQHHULQJ &KDSPDQ+DOO
/RQGRQ
6LOYHU)+  ,Q%LRPDWHULDOVPHGLFDOGHYLFHVDQGWLVVXHHQJLQHHULQJS&KDSPDQ
DQG+DOO/RQGRQ
6LOYHU)+:DQJ0&DQG3LQV*'  %LRPDWHULDOV
6LWWLQJHU06FKXOW]2.H\V]HU*0LQXWK::DQG%XUPHVWHU*5  ,QW-
$UWLI2UJDQV
6SUD\7/DQG5REHUWV:&  $P-&DUGLRO
6WHUQH*'%URZQ5$*UHHQ&-DQG7HUHQJKL*  (XU-1HXURVG
6WHUQH*'&RXOWRQ*5%URZQ 5$*UHHQ &-DQG7HUHQJKL *   - &HOO
%LRO
6WHUSHWWL $ 9 &XFLQD $ )UDJDOH $ /HSLGL 6 &DYDOODUR $ DQG 6DQWRUR /  
(XU-9DVF6XUJ
6WRNHV&/5XSQLFN0$:LOOLDPV6.DQG/DXIIHQEXUJHU'$  /DE,QYHVW

6XQ$0  ,Q7LVVXHHQJLQHHULQJPHWKRGVDQGSURWRFROV HG-50RUJDQDQG0/
<DUPXVK S+XPDQD3UHVV1HZ-HUVH\
7DODV*%URZQ5$DQG0F*URXWKHU'$  %LRFKHP3KDUPDFRO
7DUDYHO01DQG'DPDUG$  %LRPDWHULDOV
7KHREDOG9$/DXHU-'.DSODQ)$HWDO  7UDQVSODQWDWLRQ
7KRXPLQH21HUHP50DQG*LUDUG35  /DE,QYHVW
7LQRLV(7RLOOLHU-*DXFKHUDQG0HWDO  ([S&HOO5HV
8QGHUZRRG6$IRNH$%URZQ5$0F/HRG$-DQG'XQQLOO3  %LRSURFHVV
%LJ
8QJDUL6.DWDUL56$OHVVDQGUL*DQG*XOOLQR30  ,QYDVLRQ0HWDVW
8UEDQ-3  %U-5KHXPDWROHWDO
9DFDQWL&$/DQJHU56FKORR%DQG9DFDQWL-3  +RVW5HFRQVWU6XUJ

9DQ :DFKHP 3 % YDQ /X\HQ 0 - DQG GD &RVWD 0 /   - %LRPHG 0DWHU
5HV
YDQ :DFKHP 3 % YDQ /X\HQ 0 - 2OGH 'DPLQN / + 'LMNVWUD 3 - )HLMHQ - DQG
1LHXZHQKLV3  ,QW-$UWLI2UJDQV
9DQGHQEHUJ++  ,Q9LWUR&HOO'HY%LRO
:DQJ1%XWOHU@3DQG,QJEHU'(  6FLHQFH
:HLVV3  -([S=RRO
:HVW'&+DPSVRQ,1$UQROG)HWDO  6FLHQFH
:KLWZRUWK , + %URZQ 5 $ 'RUH & *UHHQ & - DQG 7HUHQJKL *  - +DQG
6XUJ%
:KLWZRUWK , + %URZQ 5 $ 'RUH & *UHHQ & - DQG 7HUHQJKL *   - +DQG
6XUJ%
:KLWZRUWK,+7HUHQJKL**UHHQ&-%URZQ5$6WHYHQV(DQG7RPOLQVRQ'5
 (XU-1HXURVFL
:LGPHU06DQG0LNRV$*  ,Q)URQWLHUVLQWLVVXHHQJLQHHULQJ HG&:
:LOOLDPV/5'DQLHOVHQ10XOOHU+DQG9DURQ6  -&RPS1HXURO

ϭϵϲ

:LOVRQ-0%LULQ\L/.6DORPRQ51/LEE\3/&DOORZ$'DQG0XOOLJDQ5
&  6FLHQFH
:RMFLDN6WRWKDUG %&URVVDQ- &XUWLV $ 6* DQG :LONLQVRQ & '   - 0DWHU
6FL0DWHU0HG
:RMFLDN6WRWKDUG%'HQ\HU00LVKUD0DQG%URZQ5$  ,Q9LWUR&HOO'HY
%LG
:RQJ0:XHWKULFK3%XVKPDQQ0'(JJOL3DQG+XQ]LNHU(%  -2UWKRS
5HV
:RRGOH\'7  ,Q7KHPROHFXODUDQGFHOOXODUELRORJ\RIZRXQGUHSDLUQGHGQ HG
5$)&ODUN S3OHQXP3UHVV1HZ<RUN
<DQQDV,9  ,Q&ROODJHQ HG0(1LPQL 9RO,,,S&5&3UHVV)ORULGD
<DQQDV , 9   ,Q &ROODJHQ 9RO ,,, %LRWHFKQRORJ\ HG 0 ( 1LPQL  S  &5&
3UHVV)ORULGD
<DQQDV,9  $QJHZ&KHP,QW(G(QJO
<DQQDV,9DQG%XUNH-)  -%LRPHG0DWHU5HV
<DQQDV,9DQG7REROVN\$9  1DWXUH
<DQQDV,9%XUNH-)2UJLOO'3DQG6NUDEXW(0  6FLHQFH
<DQQDV,9/HH(2UJLOO'36NUDEXW(0DQG0XUSK\*)  3URF 1DWO
$FDG6UL86$
<RXQJ - + 7HXPHU - .HPS 3 DQG 3DUHQWHDX 1   ,Q 3ULQFLSOHV RI WLVVXH
HQJLQHHULQJ HG 5 /DQ]D 5 /DQJHU DQG : &KLFN  S  5 * /DQGHV $XVWLQ
7H[DV




























ϭϵϳ

 &KDSWHU
&\WRWR[LFLW\DQGYLDELOLW\DVVD\V

,QWURGXFWLRQ

'UXJ GHYHORSPHQW SURJUDPPHV LQYROYH SUHFOLQLFDO VFUHHQLQJ RI YDVW QXPEHUV RI
FKHPLFDOV IRU VSHFLILF DQG QRQVSHFLILF F\WRWR[LWLW\ DJDLQVW PDQ\ W\SHV RI FHOOV %RWK DUH
LPSRUWDQWIRULQGLFDWLQJWKHSRWHQWLDOWKHUDSHXWLFWDUJHWDQGVDIHW\HYDOXDWLRQ$QLPDOPRGHOV
KDYHDOZD\VSOD\HGDQLPSRUWDQWUROHLQERWKFRQWH[WVDQGDOWKRXJKFHOOFXOWXUHV\VWHPVKDYH
ILJXUHGODUJHO\LQWKHILHOGRIFDQFHUFKHPRWKHUDS\ZKHUHWKHSRWHQWLDOYDOXHRIVXFKV\VWHPV
IRUF\WRWR[LFLW\DQGYLDELOLW\WHVWLQJLVQRZZLGHO\DFFHSWHGWKHUHLVLQFUHDVLQJSUHVVXUHIRUD
PRUHFRPSUHKHQVLYHDGRSWLRQRILQYLWURWHVWLQJLQVDIHW\HYDOXDWLRQ7KHLPSHWXVIRUFKDQJH
RULJLQDWHV SDUWO\ IURP ILQDQFLDO FRQVLGHUDWLRQV EHFDXVH LQ YLWUR WHVWLQJ KDV FRQVLGHUDEOH
HFRQRPLF DGYDQWDJHV RYHU LQ YLYR WHVWLQJ 7KHUH LV DOVR DQ LQFUHDVLQJ UHDOL]DWLRQ RI WKH
OLPLWDWLRQVRIDQLPDOPRGHOVLQUHODWLRQWRKXPDQPHWDEROLVPDVPRUHDQGPRUHPHWDEROLF
GLIIHUHQFHV EHWZHHQ VSHFLHV FRPH WR EH LGHQWLILHG )LQDOO\ DQG DV LPSRUWDQWO\ WKHUH LV WKH
PRUDOSUHVVXUHWRUHGXFHDQLPDOH[SHULPHQWDWLRQ

7KH VDIHW\ HYDOXDWLRQ RI FKHPLFDOV LQYROYHV D UDQJH RI VWXGLHV RQ PXWDJHQLFLW\
FDUFLQRJHQLFLW\DQGFKURQLFWR[LFLW\:KLOVWWKHPDMRUDSSOLFDWLRQRILQYLWURFXOWXUHVLVWKH
DQDO\VLVRIDFXWHWR[LFLW\WKHH[LVWHQFHRIDGHTXDWHFXOWXUHV\VWHPVZRXOGDOVRLPSURYHWKH
SURVSHFWVRIFKURQLFWR[LFLW\WHVWLQJ7R[LFRORJ\DQGFDQFHUFKHPRWKHUDS\WKHUHIRUHVKDUHWKH
DLPRIGHWHUPLQLQJWKHDFXWHWR[LFLW\RIDUDQJHRIFKHPLFDOVDJDLQVWDYDULHW\RIFHOOW\SHV
,QERWKDUHDVWKHUHPD\EHVHYHUDOXOWLPDWHJRDOV

‡LGHQWLILFDWLRQRISRWHQWLDOO\DFWLYHFRPSRXQGV
‡LGHQWLILFDWLRQRIWKHPHFKDQLVPE\ZKLFKWKHFRPSRXQGH[HUWVLWVWR[LFHIIHFW
‡SUHGLFWLRQRIDQWLFDQFHUDFWLYLW\
‡LGHQWLILFDWLRQRIDSRWHQWLDOWDUJHWFHOOSRSXODWLRQ
‡LGHQWLILFDWLRQRIWKHWR[LFFRQFHQWUDWLRQUDQJH
‡UHODWLRQVKLSRIFRQFHQWUDWLRQWRH[SRVXUHWLPH &[7 

7KHIXQGDPHQWDOUHTXLUHPHQWVIRUERWKWR[LFRORJ\DQGVFUHHQLQJIRUDQWLFDQFHUDFWLYLW\
DUH VLPLODU 7KH\ DUH ILUVW WKDW WKH DVVD\ V\VWHP VKRXOG JLYH D UHSURGXFLEOH GRVHUHVSRQVH
FXUYHZLWK ORZLQKHUHQWYDULDELOLW\ RYHUD FRQFHQWUDWLRQ UDQJH ZKLFKLQFOXGHVWKHH[SRVXUH
GRVHLQYLYR6HFRQGO\WKHVHOHFWHGUHVSRQVHFULWHULRQVKRXOGVKRZDOLQHDUUHODWLRQVKLSZLWK
FHOOQXPEHUDQGWKLUGO\WKHLQIRUPDWLRQREWDLQHGIURPWKHGRVHUHVSRQVHFXUYHVKRXOGUHODWH
SUHGLFWLYHO\WRWKHLQYLYRHIIHFWRIWKHVDPHGUXJ

%DFNJURXQG

8VHRILQYLWURDVVD\V\VWHPVIRUWKHVFUHHQLQJRISRWHQWLDODQWLFDQFHUDJHQWVKDVEHHQ
FRPPRQSUDFWLFHDOPRVWVLQFHWKHEHJLQQLQJVRIFDQFHUFKHPRWKHUDS\LQIROORZLQJWKH
GLVFRYHU\RIWKHDQWLQHRSODVWLFDFWLYLW\RIQLWURJHQPXVWDUG

$FFXPXODWHG H[SHULHQFH ERWK FOLQLFDO DQG H[SHULPHQWDO GHPRQVWUDWHG WKH
KHWHURJHQHLW\ RI FKHPRVHQVLWLYLW\ EHWZHHQ WXPRXUV HYHQ WKRVH RI LGHQWLFDO KLVWRORJ\ 7KH
VXFFHVVIXO GHYHORSPHQWRI WKH LQ YLWURDJDU SODWH DVVD\ IRU DQWLELRWLF VFUHHQLQJ SUHFLSLWDWHG
LQWHUHVWLQWKHGHYHORSPHQWRIDQDQDORJRXVWHFKQLTXHIRU WDLORULQJ FKHPRWKHUDS\WRVXLWWKH
ϭϵϴ

LQGLYLGXDO UXPRXU DQG SDWLHQW WKXV UHPRYLQJ WKH XQGHVLUDEOH FRPELQDWLRQ RI LQHIIHFWLYH
FKHPRWKHUDS\LQWKHSUHVHQFHRIQRQVSHFLILFWR[LFLW\

7KH FRUUHODWLRQ EHWZHHQ LQ YLWUR GUXJ VHQVLWLYLW\ H[KLELWHG E\ SULPDU\ FXOWXUHV RI
KXPDQ WXPRXUV DQG WKHLU LQ YLYR FRXQWHUSDUWV DUJXHG IRU WKHLU XVH LQ GUXJ HYDOXDWLRQ
SURJUDPPHV EHFDXVH WKH\ SURYLGHG D FORVHU DSSUR[LPDWLRQ WR WKH KXPDQ FOLQLFDO VLWXDWLRQ
WKDQGLGWKHOLPLWHGQXPEHURIFHOOOLQHVZKLFKZHUHXVHG

7KH1DWLRQDO&DQFHU,QVWLWXWHQRZURXWLQHO\PHDVXUHVWKHJURZWKLQKLELWRU\SURSHUWLHV
RI HYHU\ FRPSRXQG XQGHU WHVW DJDLQVW D SDQHO RI  KXPDQ WXPRXU FHOO OLQHV ZKLFK DUH
UHSUHVHQWDWLYH RI PDMRU KXPDQ WXPRXU W\SHV )RU HDFK FRPSRXQG WHVWHG WKH *,
FRQFHQWUDWLRQ RI GUXJ QHHGHG WR LQKLELW FHOO JURZWK E\   LV JHQHUDWHG IURP WKH GRVH
UHVSRQVHFXUYHVIRUHDFKFHOOOLQH7KHSDWWHUQRIDOOWKHFHOOOLQHVDVDJURXSLVWKHQXVHGWR
UDQN FRPSRXQGV DFFRUGLQJ WR ZKHWKHU D QHZ FRPSRXQG LV OLNHO\ WR VKDUH D FRPPRQ
PHFKDQLVPRIDFWLRQZLWKFRPSRXQGVDOUHDG\SUHVHQWLQWKHGDWDEDVH &203$5( ,QUHFHQW
\HDUVWKH&203$5( FRPSXWHU DOJRULWKP KDV EHHQ DSSOLHGWRFRUUHODWHSDWWHUQVRIJURZWK
LQKLELWLRQZLWKSDUWLFXODUPROHFXODUSURSHUWLHVRIWKHFHOOOLQHV7KHGHYHORSPHQWVLQWKHILHOG
RIVDIHW\HYDOXDWLRQRIGUXJVKDYHEHHQUHYLHZHGE\VHYHUDODXWKRUV7KHUHDUHDQXPEHURI
DGYDQWDJHV RI LQ YLWUR WHVWLQJ IRU VDIHW\ HYDOXDWLRQ ZKLFK LQFOXGH DQDO\VLV RI VSHFLHV
VSHFLILFLW\IHDVLELOLW\ RIXVLQJ RQO\ VPDOO DPRXQWV RIWHVWVXEVWDQFHVDQGWKHIDFLOLW\ WRGR
PHFKDQLVWLFVWXGLHV

6SHFLILFWHFKQLTXHV

7KHFKRLFHRIDVVD\GHSHQGVRQWKHFRQWH[WLQZKLFKWKHDVVD\LVWREHXVHGWKHRULJLQ
RI WKH WDUJHW FHOOV DQG WKH QDWXUH RI WKH WHVW FRPSRXQGV 3DUDPHWHUV ZKLFK YDU\ EHWZHHQ
DVVD\VLQFOXGH
‡FXOWXUHPHWKRG
‡GXUDWLRQRIGUXJH[SRVXUHDQGGUXJFRQFHQWUDWLRQ
‡GXUDWLRQRIUHFRYHU\SHULRGDIWHUGUXJH[SRVXUH
‡HQGSRLQWXVHGWRTXDQWLWDWHGUXJHIIHFW

&XOWXUHPHWKRGV

7KHFKRLFHRIFXOWXUHPHWKRGGHSHQGVRQWKHRULJLQRIWKHWDUJHWFHOOVDQGWKHGXUDWLRQ
RIWKHDVVD\DQGWRVRPHH[WHQWGLFWDWHVWKHHQGSRLQW

2UJDQFXOWXUH

7KHDGYDQWDJHVRIRUJDQFXOWXUHUHODWHWRWKHPDLQWHQDQFHRIWLVVXHLQWHJULW\DQGFHOO
FHOOUHODWLRQVKLSVLQYLWURJLYLQJDPRGHOWKDWLVPRUHUHSUHVHQWDWLYHRIWKHLQYLYRVLWXDWLRQ
WKDQWKHPDMRULW\RIFXOWXUHPHWKRGVDYDLODEOH+RZHYHUUHOLDEOHTXDQWLWDWLRQRIGUXJHIIHFW
LVLPSDLUHGE\YDULDWLRQ LQ VL]H DQGFHOOXODU KHWHURJHQHLW\EHWZHHQUHSOLFDWHV$OWKRXJKWKH
PHWKRGKDVEHHQXVHGH[WHQVLYHO\WRVWXG\WKHKRUPRQHVHQVLWLYLW\RISRWHQWLDOO\UHVSRQVLYH
WDUJHWWLVVXHVWKHQXPEHURIVWXGLHVUHODWLQJWRGUXJVHQVLWLYLW\LVOLPLWHG

6SKHURLGV

6SKHURLGVUHVXOWIURPWKHVSRQWDQHRXVDJJUHJDWLRQRIFHOOVLQWRVPDOOVSKHULFDOPDVVHV
ZKLFKJURZE\SUROLIHUDWLRQRIWKHFRPSRQHQWFHOOV7KHLUVWUXFWXUHLVDQDORJRXVWRWKDWRID

ϭϵϵ

VPDOOWXPRXUQRGXOHRUPLFURPHWDVWDVLVDQGWKHXVHRIVSKHURLGVIRUGUXJVHQVLWLYLW\WHVWLQJ
WKHUHIRUHSHUPLWVDQLQYLWURDQDO\VLVRIWKHHIIHFWVRIWKUHHGLPHQVLRQDOUHODWLRQVKLSVRQGUXJ
VHQVLWLYLW\ ZLWKRXW WKH GLVDGYDQWDJHV SUHYLRXVO\ PHQWLRQHG IRU RUJDQ FXOWXUH 6SHFLILF
SDUDPHWHUVZKLFKFDQEHVWXGLHGDUH
‡GUXJSHQHWUDWLRQEDUULHUVLQDYDVFXODUDUHDV
‡WKHHIIHFWVRIPHWDEROLFJUDGLHQWV HJQXWULHQWVPHWDEROLWHVS2S&2 
‡WKHHIIHFWVRISUROLIHUDWLRQJUDGLHQWV

7KHPDMRULW\RIVWXGLHVKDYHEHHQFDUULHGRXWXVLQJVSKHURLGVGHULYHGIURPFHOOOLQHV
EXWSULPDU\KXPDQWXPRXUVDOVRKDYHWKHFDSDFLW\WRIRUPVSKHURLGVLQDSSUR[LPDWHO\
RIFDVHV7KHVSKHURLGIRUPLQJFDSDFLW\RIQRUPDOFHOOVLVOLPLWHGLQFRPSDULVRQZLWKWXPRXU
FHOOV VR VWURPDO HOHPHQWV PD\ EH H[FOXGHG GXULQJ UHDJJUHJDWLRQ RI KXPDQ WXPRXU ELRSV\
PDWHULDO &XOWXUH WLPHV LQ H[FHVV RI WZR ZHHNV DUH XVXDOO\ QHFHVVDU\ IRU GUXJ VHQVLWLYLW\
WHVWLQJ DQG WKH PHWKRG LV WKHUHIRUH QRW VXLWDEOH LQ D VLWXDWLRQ ZKHUH UHVXOWV DUH UHTXLUHG
TXLFNO\

6XVSHQVLRQFXOWXUHV
L6KRUWWHUPFXOWXUHV KRXUV 

7KH VKRUWWHUP PDLQWHQDQFH RI FHOOV LQ VXVSHQVLRQ IRU DVVD\ RI GUXJ VHQVLWLYLW\ LV
DSSOLFDEOHWRDOOFHOOVRXUFHV:KHQWKHFHOOVDUHGHULYHGIURPKXPDQWXPRXUELRSV\PDWHULDO
WKHDVVD\V\VWHPKDVVHYHUDOWKHRUHWLFDODGYDQWDJHVLQWKDWVWURPDOFHOORYHUJURZWKDQGFORQDO
VHOHFWLRQ DUH PLQLPL]HG DQG UHVXOWV FDQ EH REWDLQHG UDSLGO\ 7KH PHWKRG KDV EHHQ XVHG
H[WHQVLYHO\ LQ *HUPDQ\ IRU FKHPRVHQVLWLYLW\ VWXGLHV RQ D YDULHW\ RI WXPRXU W\SHV $
PRGLILHG PHWKRG XVLQJ HLWKHU WLVVXH IUDJPHQWV RU FHOOV KDV EHHQ GHVFULEHG DJDLQ ZLWK D
YDULHW\RIWXPRXUW\SHVXVLQJWKHLQFRUSRUDWLRQRIWULWLDWHGQXFOHRWLGHVLQWR'1$RU51$DV
DQHQGSRLQW/LPLWDWLRQVRIWKHPHWKRGUHODWHPDLQO\WRWKHVKRUWWLPH SHULRGRI WKHDVVD\
ZKLFKSUHFOXGHVORQJGUXJH[SRVXUHVRYHURQHRUPRUHFHOOF\FOHVDQG WDNHV QRDFFRXQW RI
HLWKHUWKHUHYHUVLELOLW\RIWKHGUXJ VHIIHFWRURIGHOD\HGF\WRWR[LFLW\

LL,QWHUPHGLDWHGXUDWLRQFXOWXUHV GD\V 

6XVSHQVLRQFXOWXUHVRILQWHUPHGLDWHGXUDWLRQDUHSDUWLFXODUO\VXLWHGWRFKHPRVHQVLWLYLW\
VWXGLHVRQKDHPDWRORJLFDOPDOLJQDQFLHVDQGKDYHEHHQGHVFULEHGLQVHYHUDOUHSRUWV

0RQROD\HUFXOWXUH

7KHWHFKQLTXHRIJURZLQJFHOOVDVDPRQROD\HUKDVEHHQPRVWIUHTXHQWO\DSSOLHGWRWKH
F\WRWR[LFLW\WHVWLQJRIFDQFHUFHOOOLQHVEXWWKHPHWKRGKDVDOVREHHQXVHGZLWKVRPHVXFFHVV
IRUVWXGLHVRQWKHFKHPRVHQVLWLYLWLHVRIELRSVLHVIURPDYDULHW\RIGLIIHUHQWWXPRXUW\SHV,Q
WKHFDVHRIKXPDQELRSV\PDWHULDOWKHJUHDWHVWSUREOHPVDVVRFLDWHGZLWKWKHPHWKRGDUHILUVW
WKDW WKH VXFFHVV UDWH LV OLPLWHG EHFDXVH DGKHUHQFH DQG SUROLIHUDWLRQ RI WXPRXU FHOOV LV QRW
DOZD\V REWDLQHG DQG VHFRQGO\ WKDW FRQWDPLQDWLRQ RI WXPRXU FHOO FXOWXUHV E\ VWURPDO FHOOV
PD\RFFXU6RPHPHWKRG RIFHOO LGHQWLILFDWLRQ LV WKHUHIRUHDQHVVHQWLDOSDUWRIVXFKDVVD\V
7KH WHFKQLTXH KDV DOVR IRXQG ZLGH DFFHSWDQFH ZLWK WR[LFRORJLVWV EHFDXVH DSSURSULDWH FHOO
OLQHVPD\EHDYDLODEOHIRUWKHGHYHORSPHQWRIPRGHOVIRUVSHFLILFRUJDQV\VWHPV

0RQROD\HUV RIIHU JUHDWIOH[LELOLW\ LQWHUPV RI GUXJ H[SRVXUH DQG UHFRYHU\ FRQGLWLRQV
DQG LQ PHWKRGV RI TXDQWLWDWLRQ RI GUXJ HIIHFW 7KH UDQJH RI PLFURWLWUDWLRQ SODWHV QRZ
DYDLODEOH WRJHWKHU ZLWK GHYHORSPHQWV LQ DXWRPDWLRQ KDV LQ WXUQ OHG WR PLFURVFDOH

ϮϬϬ

PHWKRGRORJLHVZKLFKDUHHFRQRPLFDOLQWHUPVRIFHOOQXPEHUVUHTXLUHGDQGUHDJHQWV7KHUH
KDYHEHHQPDMRUGHYHORSPHQWV LQWKLV DUHDLQUHFHQW\HDUVIDFLOLWDWLQJKLJKWKURXJKSXWGUXJ
VFUHHQLQJXVLQJFHOOOLQHV:KHQFHOOQXPEHUVIURPELRSVLHVDUHOLPLWHGLWPD\EHIHDVLEOHWR
FXOWXUHWKHFHOOVXQWLOVXIILFLHQWQXPEHUVDUHDYDLODEOHIRUDVVD\DOWKRXJKUHSRUWVRQFKDQJHV
LQ FKHPRVHQVLWLYLW\ DIWHU VXEFXOWXUH DUH FRQIOLFWLQJ 7ZR WR WKUHH VXEFXOWXUHV DUH SUREDEO\
DFFHSWDEOH DQG LQGHHG VXEFXOWXUH KDV EHHQ UHFRPPHQGHG EHFDXVH YDULDELOLW\ EHWZHHQ
UHSOLFDWHV LV UHGXFHG :KHQ VWURPDO FHOO FRQWDPLQDWLRQ LV XQDFFHSWDEO\ KLJK VXEFXOWXULQJ
DOVRRIIHUVWKHSRVVLELOLW\RI SXULI\LQJ WXPRXUFHOOFXOWXUHVE\GLIIHUHQWLDOHQ]\PHWUHDWPHQW
RUSK\VLFDOFHOOVHSDUDWLRQ

&ORQRJHQLFJURZWKLQVRIWDJDU

$OWKRXJKPRQROD\HUFORQLQJFDQEHDSSOLHGWRFHOOVFXOWXUHGGLUHFWO\IURPWKHWXPRXU
WKHPDMRULW\RIUHSRUWVLQUHFHQW\HDUVKDYHXVHGVXVSHQVLRQFORQLQJWRPLQLPL]HJURZWKRI
DQFKRUDJHGHSHQGHQWVWURPDOFHOOV&ORQRJHQLFDVVD\VKDYHWKHWKHRUHWLFDODGYDQWDJHWKDWWKH
UHVSRQVHLV PHDVXUHG VHOHFWLYHO\ LQ FHOOV ZLWK D KLJKFDSDFLW\ IRU VHOIUHQHZDO VWHPFHOOV 
+RZHYHU WKLV LV RQO\ WUXH LI FRORQLHV DUH FORQHV LH ZHUH LQLWLDWHG IURP RQH FHOO DQG QRW
IURP D FOXPS  DQG DUH VFRUHG DIWHU PDQ\ FHOO JHQHUDWLRQV LQ FORQDO JURZWK &ORQLQJ
HIILFLHQFLHV RI  PD\ EH REWDLQHG EXW LW LV GLIILFXOW WR H[FOXGH WKH SRVVLELOLW\ RI
FOXPSV ZKLOVW WHQ JHQHUDWLRQV DERXW  FHOOV  FDQ EH UHDGLO\ REWDLQHG LQ PRQROD\HU
FORQLQJVXVSHQVLRQFRORQLHVDUHRIWHQVFRUHGDIWHUIRXUWRVL[FHOOJHQHUDWLRQV FHOOV 
*LYHQWKDWVRPHRI WKHVHFRORQLHV VWDUWHG RXW DV FOXPSVRI WKUHHRUIRXUFHOOVRUODUJHU WKH
JHQHUDWLRQQXPEHUFRXOGEHDVORZDVWZRDQGWKHLUFDSDFLW\IRUVHOIUHQHZDOLQGRXEW

7HFKQLFDO SUREOHPV KDYH EHHQ HQFRXQWHUHG XVLQJ VROLG WXPRXUV DQG HIIXVLRQV IURP
SDWLHQWVZKLFKXQIRUWXQDWHO\LQIOXHQFHLQWHUSUHWDWLRQRIUHVXOWV7KHVHLQFOXGHGLIILFXOWLHVLQ
REWDLQLQJDSXUHVLQJOHFHOOVXVSHQVLRQIURPHSLWKHOLDOWXPRXUVYHU\ORZSODWLQJHIILFLHQFLHV
   WKH IRUPDWLRQ RI FRORQLHV IURP DQFKRUDJHGHSHQGHQW FHOOV XQGHU FHUWDLQ JURZWK
FRQGLWLRQVUHTXLUHPHQWVIRUODUJHFHOOQXPEHUVDQGILQDOO\WKHVRPHZKDWVXEMHFWLYHQDWXUH
RI FRORQ\ TXDQWLWDWLRQ &ULWLFDO DVVHVVPHQW RI WKH WHFKQLFDO GLIILFXOWLHV ZKLFK KDYH EHHQ
HQFRXQWHUHG ZLWK WKH KXPDQ WXPRXU VWHP FHOO DVVD\  FDQ EH IRXQG LQ VHYHUDO UHSRUWV $Q
DOWHUQDWLYH PHWKRGRORJ\ GHYHORSHG E\ &RXUWHQD\ DQG RWKHUV JLYHV KLJKHU SODWLQJ
HIILFLHQFLHVDQG LQ D FRPSDULVRQ ZLWK WKH +DPEXUJHU6DOPRQ  V\VWHP LW ZDVDSSDUHQW WKDW
WKHPHWKRGRORJ\XVHGLQIOXHQFHGWKHFKHPRVHQVLWLYLW\SURILOHREWDLQHG )LJXUH 

,QUHFHQW \HDUV FRPSDUDWLYHO\ IHZ SXEOLFDWLRQV KDYHGHDOWZLWKWKHDSSOLHG XVHRIWKH
DVVD\ EXW WKHUH KDYH EHHQ VHYHUDO UHSRUWV GHVFULELQJ PHWKRGV RI LPSURYLQJ SODWLQJ
HIILFLHQFLHVLQVRIWDJDU

ϮϬϭ

 
)LJXUH  'RVHUHVSRQVH FXUYHV RI D PHODQRPD [HQRJUDIW FXOWXUHG LQ VRIW DJDU XVLQJ
WKH &RXUWHQD\ PHWKRG ‡ DQGWKH +DPEXUJHU6DOPRQ  PHWKRG 2  &HOOV ZHUHH[SRVHGWR
WKHGUXJVIRUKSODWHGDW[FHOOVSHUWXEHRUGLVKDQGVFRUHGIRUFRORQLHVDIWHUGD\V
LQFXEDWLRQ&RQWUROFXOWXUHVSURGXFHGDERXWFRORQLHVXVLQJERWKPHWKRGV

'XUDWLRQRIGUXJH[SRVXUHDQGGUXJFRQFHQWUDWLRQV

7KH FKRLFH RI GUXJ FRQFHQWUDWLRQV VKRXOG EH GLFWDWHG E\ FRQVLGHUDWLRQ RI WKH
WKHUDSHXWLF OHYHOV ZKLFK FDQ EH DFKLHYHG ZLWK FOLQLFDOO\ XVHG GUXJ GRVDJHV :KHQ WKH
FRPSRXQG LV XQGHUJRLQJ SUHFOLQLFDO VFUHHQLQJ IRU SRWHQWLDO DQWLWXPRXU DFWLYLW\ WKLV LV QRW
SRVVLEOH$FFXPXODWHGHYLGHQFHRQHIIHFWLYHLQYLWUROHYHOVRIFRPSRXQGVZLWKNQRZQLQYLYR
DFWLYLW\VXJJHVWVDQXSSHUOLPLWRI—JPO

ϮϬϮ

 3KDUPDFRNLQHWLFGDWDDUHDYDLODEOHIRUPDQ\RIWKHFOLQLFDOO\XVHGDQWLFDQFHUGUXJVDQG
SDUDPHWHUV ZKLFKDUHUHOHYDQW WR LQYLWUR DVVD\V LQFOXGHWKH SHDN SODVPDFRQFHQWUDWLRQ DQG
WKH SODVPD FOHDUDQFH FXUYHV )LJXUH   $ GHWDLOHG GHVFULSWLRQ RI SKDUPDFRORJLFDO
FRQVLGHUDWLRQV PD\ EH IRXQG HOVHZKHUH 3KDUPDFRNLQHWLF GDWD RQ PRVW FDQFHU
FKHPRWKHUDSHXWLF DJHQWV ZKLFK LQFOXGHV SHDN SODVPD FRQFHQWUDWLRQ WKH & ; 7 SDUDPHWHU
ZKHUH&LVFRQFHQWUDWLRQDQG7LVWLPHLQKRXUV DQGWKHWHUPLQDOKDOIOLIH W RIWKHGUXJ
LQ SODVPD KDYH EHHQ VXPPDUL]HG :KHQ QR SKDUPDFRNLQHWLF GDWD DUH DYDLODEOH DQ
DSSUR[LPDWLRQ RI WKH SODVPD OHYHOV FDQ EH REWDLQHG E\ FDOFXODWLRQ RI WKH WKHRUHWLFDO
FRQFHQWUDWLRQREWDLQHGZKHQWKHDGPLQLVWHUHGGRVHLVHYHQO\GLVWULEXWHGWKURXJKRXWWKHWRWDO
ERG\IOXLGFRPSDUWPHQW ,W LV D[LRPDWLFWKDW WKHFRQFHQWUDWLRQ UDQJHDGRSWHGVKRXOGJLYHD
GRVHUHVSRQVH FXUYH 7KH VDPH SURYLVRV DSSO\ ZKHQ GHFLGLQJ RQ DSSURSULDWH GUXJ
FRQFHQWUDWLRQVIRUWKHDVVHVVPHQWRIDFXWHWR[LFLW\WKRXJKXSSHUFRQFHQWUDWLRQOHYHOVPD\EH
LQH[FHVVRI—JP

3KDUPDFRNLQHWLF GDWD VKRZ WKDW PD[LPXP H[SRVXUH WR GUXJ RFFXUV LQ WKH ILUVW KRXU
DIWHULQWUDYHQRXVLQMHFWLRQDQGIRUWKLVUHDVRQDQH[SRVXUHSHULRGRIKKDVEHHQFKRVHQE\
PDQ\ LQYHVWLJDWRUV :KLOVW WKLV PD\ EH DGHTXDWH IRU F\FOHVSHFLILF GUXJV VXFK DV WKH
DON\ODWLQJDJHQWVORQJHUH[SRVXUHWLPHVRYHUVHYHUDOFHOOF\FOHVPD\EHQHFHVVDU\IRUSKDVH
VSHFLILF GUXJV 3URORQJHG GUXJ H[SRVXUH XVLQJ D YDULHW\ RIFDQFHUFKHPRWKHUDSHXWLF DJHQWV
KDV EHHQ VKRZQ WR UHVXOW LQ JUDGXDOO\ GHFUHDVLQJ ,' YDOXHV DV H[SRVXUH WLPHV LQFUHDVH
ILJXUH ,QVRPHFDVHVWKHVHUHDFKDVWDEOHPLQLPXPSODWHDXYDOXH5DWHRISHQHWUDWLRQRI
WKH GUXJ PD\ DOVR EH D OLPLWLQJ IDFWRU ZKHQ VKRUW H[SRVXUH WLPHV DUH XVHG 8OWLPDWHO\ WKH
TXHVWLRQ RIGXUDWLRQ RIGUXJ H[SRVXUH EHFRPHVRQH RI SUDFWLFDOLW\ ,ID VLJQLILFDQW HIIHFW LV
DFKLHYDEOHLQKWKHQWKLVVKRXOGEHXVHG0DQ\GUXJVPD\ELQGLUUHYHUVLEO\WRLQWUDFHOOXODU
FRQVWLWXHQWVDQGWKHDFWXDOH[SRVXUHPD\WKHUHIRUHEHLQH[FHVVRIKGXHWRGUXJUHWHQWLRQ
2WKHUVSULQFLSDOO\WKHDQWLPHWDEROLWHVDQGDQWLWXEXOLQVDUHPRUHOLNHO\WREHUHYHUVLEOHLIQRW
SUHVHQWDWWKHVHQVLWLYHSKDVHRIWKHFHOOF\FOHDQGSURORQJHGH[SRVXUHVSDQQLQJRQHRUPRUH
FHOO F\FOHV PD\ EH UHTXLUHG 5HVLVWDQFH RI WKH VXUYLYLQJ IUDFWLRQ ZKHQ VKRUW H[SRVXUHV DUH
XVHGPD\EHGXHWRWKHSKDVHRIWKHFHOOF\FOHGXULQJGUXJH[SRVXUHEXWJHQHWLFDOO\UHVLVWDQW
FHOOV LH ZLWK UHVLVWDQFH HYHQ DW WKH DSSURSULDWH SKDVH RI WKH FHOO F\FOH  FDQ RQO\ EH
GHPRQVWUDWHG XQHTXLYRFDOO\ DIWHU D SURORQJHG H[SRVXUH :KHQ SURORQJHG GUXJ H[SRVXUH
WLPHVDUHXVHGLWVKRXOGEHUHPHPEHUHGWKDWWKHWKHRUHWLFDO&;7YDOXHLVRQO\HTXDOWRWKH
DFWXDO&;7YDOXHZKHQWKHGUXJUHWDLQVIXOODFWLYLW\DWƒ&RYHUWKHHQWLUHH[SRVXUHSHULRG
DQGWKHUHVSRQVHLVOLQHDUZLWKWLPH'DWDRQWKHVWDELOLW\RIVRPHDQWLFDQFHUGUXJVROXWLRQVDW
 ƒ& KDYH EHHQ UHSRUWHG 7KH HIIHFWLYH FRQFHQWUDWLRQ RI GUXJ PD\ DOVR EH UHGXFHG E\
ELQGLQJ RI GUXJ WR WKH VXUIDFH RI WKH LQFXEDWLRQ YHVVHO DQG PHGLXP FRPSRQHQWV
&RQVLGHUDWLRQV VXFK DV WKRVH GHVFULEHG DERYH DUH DOVR UHOHYDQW IRU DVVHVVPHQW RI WKH DFXWH
WR[LFLW\RIDFRPSRXQG


ϮϬϯ

 
)LJXUH7\SLFDOSODVPDFOHDUDQFHFXUYHIRULQWUDYHQRXVO\DGPLQLVWHUHGGUXJ&SHDN
SODVPDFRQFHQWUDWLRQWWHUPLQDOKDOIOLIHRIGUXJLQSODVPD7KHKDWFKHGDUHDLVWKHDUHD
XQGHUWKHFXUYHIRU7 K




)LJXUH  (IIHFW RI SURORQJHG GUXJ H[SRVXUH RQ ,' YDOXHV IRU PHUFDSWRSXULQH
03  WKLRJXDQLQH 7*  PHWKRWUH[DWH 07  F\FORSKRVSKDPLGH &<  FKORUDPEXFLO &% 
PXVWLQH 08  WKLRWHSD 77  DQG YLQEODVWLQH 9%  WHVWHG DJDLQVW +H/D FHOOV XVLQJ D
PLFURWLWUDWLRQ SODWH DVVD\ 'UXJV ZHUH UHSODFHG DW  K LQWHUYDOV IRU WKH  K DQG  K
H[SRVXUHV DQG DW   DQG  K IRU WKH  GD\ H[SRVXUH $ EUHDN LQ WKH WLPH D[LV LV
WKHUHIRUHVKRZQEHWZHHQDQGGD\V


ϮϬϰ

5HFRYHU\SHULRG

7KHLQFOXVLRQRIDUHFRYHU\SHULRGIROORZLQJGUXJH[SRVXUHPD\EHLPSRUWDQWIRUWKUHH
UHDVRQV
D :KHQPHWDEROLFLQKLELWLRQLVXVHGDVWKHHQGSRLQWLWDOORZVWKHFHOOVWRUHFRYHUIURP
PHWDEROLFSHUWXUEDWLRQVZKLFKDUHXQUHODWHGWRFHOOGHDWK
E 6XEOHWKDOGDPDJHFDQEHUHSDLUHGDQGWKHUHIRUHQRWLQWHUIHUHZLWKWKHDVVD\UHVXOW
F 'HOD\HG F\WRWR[LFLW\ SHUKDSV QRW H[SUHVVHG XQWLO RQH WR WZR FHOO F\FOHV DIWHU GUXJ
WUHDWPHQWFDQEHPHDVXUHG
G 
'HSHQGLQJ RQ WKH GUXJ DQG WKH HQGSRLQW DEVHQFH RI D UHFRYHU\ SHULRG FDQ HLWKHU
XQGHUHVWLPDWHRURYHUHVWLPDWHWKHOHYHORIFHOONLOODFKLHYHG+RZHYHULWLVHTXDOO\LPSRUWDQW
WKDWWKHUHFRYHU\SHULRGLVQRWWRRORQJEHFDXVHFHOONLOOFDQWKHQEHPDVNHGE\RYHUJURZWK
RI D UHVLVWDQW SRSXODWLRQ ,Q PRQROD\HU DVVD\V ZKLFK PRQLWRU FHOO FRXQWV RU SUHFXUVRU
LQFRUSRUDWLRQWKHFHOOVPXVWUHPDLQLQWKHORJSKDVHRIJURZWKWKURXJKRXWWKHH[SRVXUHDQG
UHFRYHU\SHULRG

(QGSRLQWV
&\WRWR[LFLW\YLDELOLW\DQGVXUYLYDO

&\WRWR[LFLW\ DVVD\V PHDVXUH GUXJLQGXFHG DOWHUDWLRQV LQ PHWDEROLF SDWKZD\V RU
VWUXFWXUDOLQWHJULW\ZKLFKPD\RUPD\QRWEHUHODWHGGLUHFWO\WRFHOOGHDWKZKHUHDVVXUYLYDO
DVVD\V PHDVXUH WKH HQGUHVXOW RI VXFK PHWDEROLF SHUWXUEDWLRQV ZKLFK PD\ EH HLWKHU FHOO
UHFRYHU\RUFHOOGHDWK7KHRUHWLFDOO\WKHRQO\UHOLDEOHLQGH[RIVXUYLYDOLQSUROLIHUDWLQJFHOOV
LV WKH GHPRQVWUDWLRQ RI UHSURGXFWLYH LQWHJULW\ DV HYLGHQFHG E\ FORQRJHQLFLW\ 0HWDEROLF
SDUDPHWHUV PD\ DOVR EH XVHG DV D PHDVXUH RI VXUYLYDO ZKHQ WKH FHOO SRSXODWLRQ KDV EHHQ
DOORZHGWLPHIRUPHWDEROLFUHFRYHU\IROORZLQJGUXJH[SRVXUH

&\WRWR[LFLW\DQGYLDELOLW\

6RPHF\WRWR[LFLW\DVVD\VRIIHULQVWDQWDQHRXVLQWHUSUHWDWLRQVXFKDVWKHXSWDNHRIDG\H
E\ GHDG FHOOV RU UHOHDVH RI &KURPLXP RU IOXRUHVFHLQ IURP SUHODEHOOHG FHOOV 7KHVH KDYH
EHHQ WHUPHG WHVWV RI YLDELOLW\ DQG DUH LQWHQGHG WR SUHGLFW VXUYLYDO UDWKHU WKDQ PHDVXUH LW
GLUHFWO\ 2Q WKH ZKROH WKHVH WHVWV DUH JRRG DW LGHQWLI\LQJ GHDG FHOOV EXW PD\ RYHUHVWLPDWH
ORQJWHUP VXUYLYDO 0RVW LPSO\ D EUHDNGRZQ LQ PHPEUDQH LQWHJULW\ DQG LUUHYHUVLEOH FHOO
GHDWK 2WKHU DVSHFWV RI F\WRWR[LFLW\ PHDVXULQJ PHWDEROLF HYHQWV PD\ EH PRUH DFFXUDWHO\
TXDQWLILHGDQGDUHYHU\VHQVLWLYHEXWSUHGLFWLRQRIVXUYLYDOLVOHVVFHUWDLQDVPDQ\IRUPVRI
PHWDEROLF LQKLELWLRQ PD\ EH UHYHUVLEOH ,Q WKHVH FDVHV LPSDLUPHQW RI VXUYLYDO FDQ RQO\ EH
LQIHUUHG LI GHSUHVVHG UDWHV RI SUHFXUVRU LQFRUSRUDWLRQ LQWR '1$ 51$ RU SURWHLQ DUH
PDLQWDLQHGDIWHUWKHHTXLYDOHQWRIVHYHUDOFHOOSRSXODWLRQGRXEOLQJWLPHVKDVHODSVHG

0HPEUDQHLQWHJULW\

7KLVLVWKHFRPPRQHVWPHDVXUHPHQWRIFHOOYLDELOLW\DWWKHWLPHRIDVVD\,WZLOOJLYHDQ
HVWLPDWHRILQVWDQWDQHRXVGDPDJH HJE\FHOOIUHH]LQJDQGWKDZLQJ RUSURJUHVVLYHGDPDJH
RYHU D IHZ KRXUV %H\RQG WKLV TXDQWLWDWLRQ PD\ EH GLIILFXOW GXH WR ORVV RI GHDG FHOOV E\
GHWDFKPHQW DQG DXWRO\VLV 7KHVH DVVD\V DUH RI SDUWLFXODULPSRUWDQFHIRUWR[LFDJHQWV ZKLFK
H[HUWWKHLUSULPDU\HIIHFWRQPHPEUDQHLQWHJULW\

L&KURPLXPUHOHDVH

ϮϬϱ

 /DEHOOLQJFHOOVZLWK&UUHVXOWVLQFRYDOHQWELQGLQJRIFKURPDWHWREDVLFDPLQRDFLGVRI
LQWUDFHOOXODU SURWHLQV 7KHVH ODEHOOHG SURWHLQV OHDN RXW RI WKH FHOO ZKHQ WKH PHPEUDQH LV
GDPDJHG DW D UDWH ZKLFK LV SURSRUWLRQDO WR WKH DPRXQW RI GDPDJH 7KH PHWKRG LV XVHG LQ
LPPXQRORJLFDO VWXGLHVIRU GHWHUPLQLQJ F\WRWR[LF 7 FHOO DFWLYLW\ DJDLQVWWDUJHWFHOOV1DWXUDO
OHDNDJHRI&UIURPXQGDPDJHGFHOOVPD\EHKLJKDQGWKHUHIRUHWKHWLPHSHULRGRYHUZKLFK
WKHDVVD\FDQEHXVHGLVUHVWULFWHGWRDSSUR[LPDWHO\K$GGLWLRQDOO\WKHWDUJHWFHOOVPXVWEH
SUHODEHOOHG EHIRUH LQFXEDWLRQ ZLWK GUXJ RU HIIHFWRU FHOOV DQG WKH ILQDO SUHSDUDWLRQ IRU
FRXQWLQJ DV ZHOO DV FRXQWLQJ LWVHOI LV WLPHFRQVXPLQJ ,Q RQH FRPSDUDWLYH VWXG\ ZKLFK
HYDOXDWHG&UUHOHDVHDVDQHQGSRLQWIRUDQWLFDQFHUGUXJF\WRWR[LFLW\WHVWLQJWKHPHWKRGZDV
IRXQGWREHRIQRYDOXH

LL(Q]\PHUHOHDVHDVVD\V

(Q]\PHUHOHDVHDVVD\V IRUPHDVXULQJPHPEUDQHLQWHJULW\KDYHEHHQGHYHORSHGZKLFK
RYHUFRPHVRPHRIWKHSUREOHPVRIWKH&UUHOHDVHDVVD\'LIIHUHQWHQ]\PHVKDYHEHHQXVHG
WKRXJK/'+KDVEHHQIRXQGWREHJHQHUDOO\XVHIXOEHFDXVHLWLVUHOHDVHGE\DUDQJHRIFHOO
W\SHV7KLVSDSHUGHVFULEHVWKHDVVD\IRUGHWHUPLQLQJF\WRWR[LFLW\RIDQWLERG\GHSHQGHQWDQG
7 FHOOPHGLDWHG UHDFWLRQV 7KH DVVD\ DOVR KDV DSSOLFDWLRQ LQ WKH ZLGHU FRQWH[W RI WR[LFLW\
WHVWLQJDQGKDVEHHQXVHGWRLQYHVWLJDWHKHSDWRWR[LFLW\



)LJXUH  (IIHFW RI GR[RUXELFLQ  —J POK  RQ 0'$<' FHOOV DV DVVHVVHG E\
WKUHHGLIIHUHQWWHFKQLTXHV&RXOWHUFRXQWHUSDUWLFOHFRXQWV   \D[LVXQLWVDUHFHOOVPO[ 
UDWLR RI OLYLQJ WXPRXU FHOOV WR GXFN UHG EORRG FHOOV QRUPDOL]HG WR WKH VDPH VFDOH DV WKH
&RXOWHUFRXQWV  DQGSHUFHQWDJHYLDELOLW\  \D[LVXQLWVDUHSHUFHQWDJHYLDELOLW\ OLYLQJ
FHOOVOLYLQJDQGGHDGFHOOV[ ‡FRQWUROFXOWXUHV2GR[RUXELFLQWUHDWHGFXOWXUHV
LLL'\HH[FOXVLRQ

9LDELOLW\ G\HV XVHG WR GHWHUPLQH PHPEUDQH LQWHJULW\ LQFOXGH WU\SDQ EOXH HRVLQ <
QDSKWKDOHQH EODFN QLJURVLQ JUHHQ  HU\WKURVLQ % DQG IDVW JUHHQ 6WDLQLQJ IRU YLDELOLW\
DVVHVVPHQW LV PRUH VXLWHG WR VXVSHQVLRQ FXOWXUHV WKDQ WR PRQROD\HUV EHFDXVH GHDG FHOOV

ϮϬϲ

GHWDFKIURPWKHPRQROD\HUDQGDUHWKHUHIRUHORVWIURPWKHDVVD\$PDMRUGLVDGYDQWDJHPD\
EHWKHIDLOXUHRIUHSURGXFWLYHO\GHDGFHOOVWRWDNHXS G\H DV GHPRQVWUDWHG ZKHQ FHOOV ZLWK
LPSDLUHGFORQRJHQLFLW\VKRZHGYLDELOLW\DFFRUGLQJWRG\HH[FOXVLRQ7KHPHWKRGKDV
EHHQUHQRYDWHGKRZHYHUDQGWHFKQLFDOLQQRYDWLRQVLQWURGXFHGZKLFKDWWHPSWWRFLUFXPYHQW
VRPHRIWKHSUREOHPVFRPPRQO\DVVRFLDWHGZLWKVXFKDVVD\V

&RPSDULVRQRIFHOOFRXQWVYHUVXVSHUFHQWDJHYLDELOLW\YHUVXVYLDEOHFHOOGXFNFHOOUDWLR
GHPRQVWUDWHGWKHLQFUHDVHGVHQVLWLYLW\RIWKHODWWHUPHWKRG )LJXUH 7KHPHWKRGKDVEHHQ
DSSOLHGZLWKHTXDOVXFFHVVWRVROLGWXPRXUVHIIXVLRQVDQGKDHPDWRORJLFDOPDOLJQDQFLHV

LY)OXRUHVFHQWG\HV

7KHUH DUH D QXPEHU RI IOXRUHVFHQW SUREHV QRZ DYDLODEOH IRU PHDVXULQJ PHPEUDQH
LQWHJULW\7KHVHDUHVKRZQLQ7DEOH

7DEOH&RPPHUFLDOO\DYDLODEOHNLWVIRUR\WRWR[LFLW\DVVD\V
&RPSDQ\ .LW 0HWKRG
/XPLWHFK 9LDOLJKW %LROXPLQHVFHQWGHWHFWLRQRI$73
/XPLWHFK $SRJORZ 0HDVXUHVFKDQJHVLQ$'3$73UDWLR
4XDQWRV&HOOSUROLIHUDWLRQ
6WUDWDJHQH DVVD\NLW 0HDVXUHVIOXRUHVFHQFHRIDG\HZKHQERXQGWR'1$
0HWDEROLVPRIWHWUD]ROLXPVDOWVWRLQVROXEOHIRUPD]DQ
6LJPD 0,7EDVHGDVVD\NLW SURGXFWVE\PLWRFKRQGULDOHQ]\PHV
0HWDEROLVPRIWHWUD]ROLXPVDOWVWRVROXEOH ;77 
6LJPD ;77EDVHGDVVD\NLW IRUPD]DQSURGXFWVE\PLWRFKRQGULDOHQ]\PHV
6LJPD $FLGSKRVSKDWDVHEDVHGDVVD\
 NLW 8VHVSQLWURSKHQROSKRVSKDWHDVVXEVWUDWH
6LJPD 1HXWUDOUHGEDVHGDVVD\NLW 1HXWUDOUHGWDNHQXSE\O\VRVRPHVDQG*ROJLERGLHV
6LJPD .HQDFLGEOXHEDVHGDVVD\NLW %LQGVWRSURWHLQ
6LJPD 6XOIRUKRGDPLQH%EDVHG
 DVVD\NLW %LQGVWRSURWHLQ
6LJPD /DFWDWHGHK\GURJHQDVHEDVHG
 DVVD\NLW 0HDVXUHVPHPEUDQHLQWHJULW\
&HOO&HQVXV3OXVŒV\VWHPIRU &HOOVSUHODEHOOHGZLWKIOXRUHVFHQWG\H$IWHUGUXJ
6LJPD FHOOSUROLIHUDWLRQDQDO\VLV H[SRVXUHLPPXQRVWDLQLQJFDQEHXVHGWRGHWHFWGUXJ
 XVLQJIORZF\WRPHWU\ HIIHFWVRQVSHFLILFVXEVHWVRIFHOOV



5HVSLUDWLRQDQGJO\FRO\VLV

'UXJLQGXFHG FKDQJHV LQ UHVSLUDWLRQ R[\JHQ XWLOL]DWLRQ  DQG JO\FRO\VLV FDUERQ
GLR[LGH SURGXFWLRQ  KDYH EHHQ PHDVXUHG XVLQJ :DUEXUJ PDQRPHWU\ 2WKHU DXWKRUV KDYH
GHWHUPLQHG GHK\GURJHQDVH DFWLYLW\ E\ LQFRUSRUDWLQJ PHWK\OHQH EOXH LQWR DJDU FRQWDLQLQJ
GUXJWUHDWHGFHOOVFHOOGHDWKEHLQJLQGLFDWHGE\QRQUHGXFWLRQRIWKHG\H7KHODWWHUPHWKRG
KDVWKHGLVDGYDQWDJHRIEHLQJQRQTXDQWLWDWLYHZKLOVWWKHIRUPHUDOWKRXJKTXDQWLWDWLYHKDV
QRW EHHQ ZLGHO\ DGRSWHG EHFDXVH WKH WHFKQLFDO PDQLSXODWLRQV LQYROYHG DUH H[WHQVLYH DQG
XQVXLWHG WR PXOWLSOH VFUHHQLQJ 7KH PRUH GLUHFW DSSURDFK RI PRQLWRULQJ S+ FKDQJHV LQ
FXOWXUHVFRQWDLQLQJDQDSSURSULDWHS+LQGLFDWRUKDVDOVREHHQGHVFULEHG

ϮϬϳ

5DGLRLVRWRSHLQFRUSRUDWLRQ

0HDVXUHPHQWRIWKHLQFRUSRUDWLRQRIUDGLRODEHOOHGPHWDEROLWHVLVDIUHTXHQWO\XVHGHQG
SRLQWIRUF\WRWR[LFLW\DVVD\VRILQWHUPHGLDWHDQGVKRUWWHUPGXUDWLRQ

L 1XFOHRWLGHV

0HDVXUHPHQWRI>+@WK\PLGLQHLQFRUSRUDWLRQLQWR'1$DQG>+@XULGLQHLQFRUSRUDWLRQ
LQWR 51$ DUH FRPPRQO\ XVHG PHWKRGV RI TXDQWLWDWLRQ RI GUXJ F\WRWR[LFLW\ ,Q VKRUWWHUP
DVVD\VZKLFKGRQRWLQFOXGHDUHFRYHU\SHULRGWKHUHDUHDQXPEHURIGLVDGYDQWDJHVDOORI
ZKLFK UHODWH WR D IDLOXUH RI >+@WK\PLGLQH LQFRUSRUDWLRQ WR UHIOHFW WKH WUXH '1$ V\QWKHWLF
FDSDFLW\RIWKHFHOO7KHVHDUH

D &KDQJHVPD\UHODWHWRFKDQJHVLQVL]HRIWKHLQWUDFHOOXODUQXFOHRWLGHSRROVUDWKHUWKDQ
FKDQJHVLQ'1$V\QWKHVLV
E 6RPH GUXJV VXFK DV IOXRURXUDFLO DQG PHWKRWUH[DWH ZKLFK LQKLELW S\ULPLGLQH
ELRV\QWKHVLV GHQRYR SDWKZD\ FDXVHLQFUHDVHGXSWDNHRI H[RJHQRXV >+@WK\PLGLQH
GXHWRDWUDQVIHUWRWKH VDOYDJH SDWKZD\ZKLFKXWLOL]HVSUHIRUPHGS\ULPLGLQHV
F &RQWLQXDWLRQ RI '1$ V\QWKHVLV LQ WKH DEVHQFH RI >+@WK\PLGLQH LQFRUSRUDWLRQ FDQ
RFFXU
G 
7KH ORZ ODEHOOLQJ LQGH[ RI KXPDQ WXPRXUV ZLWK UHVXOWDQW ORZ OHYHOV RI QXFOHRWLGH
LQFRUSRUDWLRQ LQ VKRUWWHUP DVVD\V QHFHVVLWDWHV WKH XVH RI KLJK FHOO GHQVLWLHV ZKLFK FDQ
UHVWULFW WKH QXPEHU RI GUXJV DQG UDQJH RI FRQFHQWUDWLRQV WHVWHG ZKHQ FHOO QXPEHUV DUH
OLPLWHG 7ZR K\EULG  WHFKQLTXHV KDYH EHHQ UHSRUWHG ZKLFK FRPELQH WKH DGYDQWDJHV RI WKH
VRIWDJDUFXOWXUHV\VWHPZLWKWKHIDFLOLWDWHGTXDQWLWDWLRQRIIHUHGE\WKHXVHRIUDGLRLVRWRSHV
%RWK DVVD\V DUH RI LQWHUPHGLDWH GXUDWLRQ DERXW IRXU GD\V  DQG XVH > +@WK\PLGLQH
LQFRUSRUDWLRQ LQWR '1$ DV DQ HQGSRLQW ,Q RQH PHWKRG WKH FHOOV DUH JURZQ LQ OLTXLG
VXVSHQVLRQRYHUVRIWDJDUZKLOVWLQWKHRWKHUWKHFHOOVDUHLQFRUSRUDWHGLQWKHVRIWDJDU*LYHQ
WKDW D KRPRJHQHRXVFHOO SRSXODWLRQ LV DYDLODEOH >+@ QXFOHRWLGH LQFRUSRUDWLRQ FDQ EH XVHG
DIWHU DQ DSSURSULDWH UHFRYHU\ SHULRG WR PHDVXUH VXUYLYDO RU LQ WKH SUHVHQFH RI GUXJ WR
PHDVXUHDQDQWLPHWDEROLFHIIHFWEXWZLWKWKHUHVHUYDWLRQVH[SUHVVHGDERYH

LL>,@ORGRGHR[\XULGLQH >,@8GU 

>,@8GU LV D VSHFLILF VWDEOH ODEHO IRU QHZO\ V\QWKHVL]HG '1$ ZKLFK LV PLQLPDOO\
UHXWLOL]HGDQGFDQWKHUHIRUHEHXVHGRYHUDKSHULRGWRPHDVXUHWKHUDWHRI'1$V\QWKHVLV
TXDQWLWDWLRQLVIDFLOLWDWHGEHFDXVHWKHLVRWRSH LVD JDPPDHPLWWHU'LVDGYDQWDJHVLQFOXGHLWV
YDULDEOH WR[LFLW\ WR GLIIHUHQW FHOO SRSXODWLRQV ZKLFK WKHUHIRUH PHDQV WKDW PRUH FHOOV DUH
UHTXLUHGEHFDXVH>,@8GUPXVWEHXVHGDWORZFRQFHQWUDWLRQV

LL >3@3KRVSKDWH 3 
LLL 
7KHUDWHRIUHOHDVHRI 3LQWRWKHPHGLXPIURPSUHODEHOOHGFHOOVLVDIXQFWLRQRIWKH
FHOOW\SHDQGLVLQFUHDVHGLQGDPDJHGFHOOV7KLVKDVEHHQXVHGDVDPHDVXUHRIGUXJHIILFDF\
7KHLQFRUSRUDWLRQRI 3LQWRQXFOHRWLGHVKDVDOVREHHQXVHGDVDQLQGH[RIGUXJF\WRWR[LFLW\
1HLWKHUPHWKRGKDVEHHQURXWLQHO\DGRSWHG

LY>&@*OXFRVH


ϮϬϴ

 *OXFRVH LQFRUSRUDWLRQ LV XVHG DV D F\WRWR[LFLW\ HQGSRLQW EHFDXVH LW LV D SUHFXUVRU
ZKLFK LV FRPPRQ WR D QXPEHU RI ELRFKHPLFDO SDWKZD\V 7KH PHWKRG KDV QRW EHHQ ZLGHO\
XVHG

Y>+@$PLQRDFLGV

3URWHLQ V\QWKHVLV LV DQ HVVHQWLDO PHWDEROLF SURFHVV ZLWKRXW ZKLFK WKH FHOO ZLOO QRW
VXUYLYH DQG LQFRUSRUDWLRQ RI DPLQR DFLGV LQWR SURWHLQV KDV EHHQ XVHG DV DQ LQGH[ RI
F\WRWR[LFLW\ 7KH PRVW H[WHQVLYH VWXGLHV KDYH XWLOL]HG PRQROD\HUV RI FHOOV JURZLQJ LQ
PLFURWLWUDWLRQ SODWHV XVLQJ HLWKHU LQFRUSRUDWLRQ RI > +@ OHXFLQH PHDVXUHG E\ OLTXLG
VFLQWLOODWLRQFRXQWLQJRU>6@PHWKLRQLQHLQFRUSRUDWLRQPHDVXUHGXVLQJDXWRIOXRURJUDSK\

YL&DOFLXP &D 

8QUHODWHGFRPSRXQGVPD\SURGXFHDOWHUDWLRQVLQWKHSHUPHDELOLW\RIFHOOPHPEUDQHVWR
FDOFLXP VXFK WKDW LQFUHDVHG FDOFLXP XSWDNH UHVXOWV 0HDVXUHPHQWV RI &D XSWDNH FDQ
WKHUHIRUHEHXVHG

7RWDOSURWHLQFRQWHQW

3URWHLQFRQWHQWGHWHUPLQDWLRQLVDUHODWLYHO\VLPSOHPHWKRGIRUHVWLPDWLQJFHOOQXPEHU
,W LV SDUWLFXODUO\ VXLWHG WR PRQROD\HU FXOWXUHV DQG KDV WKH DGYDQWDJH WKDW ZDVKHG IL[HG
VDPSOHV FDQ EH VWRUHG UHIULJHUDWHG IRU VRPH WLPH EHIRUH DQDO\VLV ZLWKRXW LPSDLUPHQW RI
UHVXOWV IDFLOLWDWLQJ ODUJH VFDOH VFUHHQLQJ 2YHU HVWLPDWLRQ RI FHOO QXPEHU PD\ DULVH ZLWK
GUXJV ZKLFK LQKLELW UHSOLFDWLRQ ZLWKRXW LQKLELWLQJ SURWHLQ V\QWKHVLV HJ %UG8
PHWKRWUH[DWH $VVHVVPHQW RIF\WRWR[LFLW\UHTXLUHVWKHGHPRQVWUDWLRQRIDQDOWHUDWLRQLQWKH
DFFXPXODWLRQ RI SURWHLQ SHU FXOWXUH RYHU WLPH SUHIHUDEO\ DW VHYHUDO SRLQWV RU DW RQH SRLQW
DIWHUSURORQJHGGUXJH[SRVXUHDQGUHFRYHU\DVGHVFULEHGDERYH

&RORULPHWULFDVVD\V

7KH DGYHQW RI VRSKLVWLFDWHG PLFURSODWH UHDGHUV ZKLFK DOORZ UDSLG TXDQWLWDWLRQ RI
FRORULPHWULF DVVD\V KDV SDUDOOHOHG WKH GHYHORSPHQW RI D YDULHW\ RI DVVD\V ZKLFK XVH VRPH
IRUP RI FRORXU GHYHORSPHQW DV DQ HQGSRLQW IRU TXDQWLWDWLQJ FHOO QXPEHU 7KHVH LQFOXGH
PHWKRGVZKLFKUHIOHFW
x SURWHLQ FRQWHQW PHWK\OHQH EOXH &RRPDVVLH EOXH .HQDFLG EOXH VXOIRUKRGDPLQH %
%LFKLQRQLQLFDFLG 
x '1$FRQWHQW +RHFKVW RU'1$V\QWKHVLV %UG8XSWDNH 
x O\VRVRPHDQG*ROJLERG\DFWLYLW\ QHXWUDOUHG 
x HQ]\PHDFWLYLW\ KH[RVDPLQLGDVHPLWRFKRQGULDOVXFFLQDWHGHK\GURJHQDVH 

/LQHDUUHODWLRQVKLSVEHWZHHQHQGSRLQWDQGFHOOQXPEHUKDYHEHHQGHPRQVWUDWHGIRUDOO
WKHVH PHWKRGV 'LVFULPLQDWLRQ EHWZHHQ OLYH DQG GHDG FHOOV LQ PRQROD\HU DVVD\V LV QRW
UHOHYDQWEHFDXVHGHDGFHOOVZLOOXVXDOO\GHWDFKJLYHQVXIILFLHQWWLPH,QVXVSHQVLRQFXOWXUHV
WKLV DVSHFW LV UHOHYDQW KRZHYHU DQG QHHGV WR EH FRQVLGHUHG ZKHQ FKRRVLQJ DQ DSSURSULDWH
DVVD\0HWKRGVZKLFKPDNHXVHRIIOXRUHVFHQWG\HVKDYHLQFUHDVHGLQWKHSDVWILYH\HDUVDQG
ELROXPLQHVFHQWDVVD\VKDYHDOVREHHQGHYHORSHGIRUPHDVXULQJ$73OHYHOV

L3URWHLQFRQWHQW


ϮϬϵ

 6HYHUDO PHWKRGV DUH DYDLODEOH IRU PHDVXULQJ WKH SURWHLQ FRQWHQW RI FHOO PRQROD\HUV
7KHVHLQFOXGHWKHXVHRIWKH)ROLQ&LRFDOWHDXUHDJHQWDFFRUGLQJWRWKHPHWKRGRI/RZU\DQG
DPLGR EODFN 6HYHUDO QHZ WHFKQLTXHV IRU FRORULPHWULF GHWHUPLQDWLRQ RI SURWHLQ FRQWHQW DUH
DOVR DYDLODEOH 7KHVH LQFOXGH PHWK\OHQH EOXH VXOIRUKRGDPLQH % .HQDFLG EOXH &RRPDVVLH
EOXH*DQG%LFKLQRQLQLFDFLG %&$ 

LL'1$FRQWHQW

'1$ FRQWHQW PD\ EH PHDVXUHG LQ PLFURWLWUDWLRQ SODWHV E\ VWDLQLQJ ZLWK G\HV ZKRVH
IOXRUHVFHQFH LV HQKDQFHG E\ LQWHUFDODWLRQ DW $7VSHFLILF VLWHV RQ WKH FKURPDWLQ VXFK DV
+RHFKVW  DQG GLDPLGLQRSKHQ\OLQGROH '$3,  '1$ V\QWKHVLV PD\ DOVR EH
GHWHUPLQHGXVLQJEURPRGHR[\XULGLQH %UG8 7KHDPRXQWRI%UG8LQFRUSRUDWHGLVGHWHFWHG
LPPXQRKLVWRFKHPLFDOO\ XVLQJ D PRQRFORQDO DQWLERG\ WR %UG8 DQG WKH ELQGLQJ PD\ EH
TXDQWLWDWHGXVLQJDSSURSULDWHFRQMXJDWHVDQGFKURPRJHQLFVXEVWUDWHV

LLL/\VRVRPDODQG*ROJLERG\DFWLYLW\

7KHXSWDNHRIQHXWUDOUHG E\ O\VRVRPHV DQG *ROJL ERGLHV KDVEHHQXVHGWRTXDQWLWDWH
FHOOQXPEHU7KHVWDLQDSSHDUVWREHVSHFLILFIRUYLDEOHFHOOVEXWWKHPDLQOLPLWDWLRQRIWKH
PHWKRG LV WKH GLIIHUHQFH LQ XSWDNH EHWZHHQ FHOO W\SHV 7KXV VRPH FHOO W\SHV VXFK DV
DFWLYDWHG PDFURSKDJHV DQG ILEUREODVWV WDNH XS ODUJH DPRXQWV YHU\ UDSLGO\ ZKHUHDV RWKHUV
VXFKDVO\PSKRF\WHVVKRZQHJOLJLEOHVWDLQLQJ

LY 7HWUD]ROLXPG\HUHGXFWLRQ

7KH PRVW ZLGHO\ XVHG WHFKQLTXH LQYROYHV WKH XVH RI D WHWUD]ROLXP VDOW HJ 077
 GLPHWK\OWKLD]RO\O GLSKHQ\O WHWUD]ROLXP EURPLGH  ZKLFK LV PHWDEROL]HG WR DQ
LQVROXEOH FRORXUHG IRUPD]DQ VDOW E\ PLWRFKRQGULDO HQ]\PH DFWLYLW\ LQ OLYLQJ FHOOV 7KH
PHWKRGZDVILUVWGHVFULEHGLQDVDUDSLGFRORULPHWULFPHWKRGIRULPPXQRORJLFDOVWXGLHV
DQG PRGLILFDWLRQV IRU WKLV DSSOLFDWLRQ KDYH EHHQ GHVFULEHG 7KH WHFKQLTXH LV SDUWLFXODUO\
XVHIXO IRU DVVD\LQJ FHOO VXVSHQVLRQV EHFDXVH RI LWV VSHFLILFLW\ IRU OLYLQJ FHOOV 2QH
GLVDGYDQWDJHLVWKHQHHGWRXVHXQIL[HGFHOOVZKLFKPD\LPSRVHWLPHUHVWUDLQWV7KHSRWHQWLDO
RI WKH WHFKQLTXH IRU GUXJ VHQVLWLYLW\ WHVWLQJ RI KXPDQ WXPRXUV ZDV UHFRJQL]HG DQG HDUO\
UHSRUWV RI LWV XVH DUH SURPLVLQJ  7KHVH LQFOXGH WKH SRVVLELOLW\ RI LQFUHDVHG PLWRFKRQGULDO
HQ]\PH DFWLYLW\ LQ GUXJWUHDWHG FHOOV DQG WKH HIIHFW RI PHGLXP FRQGLWLRQLQJ E\ FHOOV RQ
IRUPD]DQSURGXFWLRQ7KHDEVRUSWLRQVSHFWUXPRI077IRUPD]DQKDVDOVREHHQVKRZQWREH
GHSHQGHQWXSRQS+DQGFHOOGHQVLW\DQGDPHWKRGKDVEHHQGHVFULEHGZKLFKRYHUFRPHVWKHVH
SUREOHPVDQGLQFUHDVHVOLQHDULW\EHWZHHQ077IRUPD]DQDQGFHOOGHQVLW\HVSHFLDOO\DWKLJK
FHOO QXPEHUV $QRWKHU GHULYDWLYH ;77 ELV PHWKR[\QLWURVXOIRSKHQ\O 
> SKHQ\ODPLQR FDUERQ\O@+WHWUD]ROLXP K\GUR[LGH  SURGXFHV D VROXEOH IRUPD]DQ HQG
SURGXFW DQG LV WKHUHIRUH HDVLHU WR XVH WKDQ 077 EHFDXVH WKHUH LV QR QHHG WR FDUU\ RXW WKH
VROXELOL]DWLRQ SURFHGXUH 7KH ;77 GHULYDWLYH KDV EHHQ XVHG VXFFHVVIXOO\ IRU TXDQWLWDWLQJ
FRORQ\IRUPDWLRQLQVRIWDJDU

Y/XPLQHVFHQFHEDVHGFHOOYLDELOLW\WHVWLQJ

/HYHOVRI$73LQDFHOOSRSXODWLRQSURYLGHDVHQVLWLYHLQGLFDWLRQRIFHOOYLDELOLW\7KH
OXPLQHVFHQFHUHDFWLRQXVHGWRGHWHUPLQH$73OHYHOVLVEDVHGRQWKHIROORZLQJUHDFWLRQ

ϮϭϬ

 
7KHVHQVLWLYLW\UDQJHKDVEHHQUHSRUWHGDVFHOOVPOWR;FHOOVPO$QXPEHURI
FRPPHUFLDONLWVDUHDYDLODEOHIRUPHDVXULQJ$73E\OXPLQHVFHQFH 7DEOH 

Y $SRSWRVLV

0DQ\ DQWLFDQFHU GUXJV NLOO FHOOV E\ DSRSWRVLV DQG PHDVXUHPHQW RI DSRSWRVLV LV
WKHUHIRUH LPSRUWDQW LQ WKH HYDOXDWLRQ RI F\WRWR[LFLW\ $SRSWRVLV FDQ EH GHWHUPLQHG LQ D
QXPEHURIZD\VLQFOXGLQJ

x PRUSKRORJLFDOFULWHULD
x '1$ODGGHULQJ
x GHWHFWLRQ RI SKRVSKDWLG\O VHULQH LQ WKH RXWHU SODVPD PHPEUDQH XVLQJ DQQH[LQ 9
FRQMXJDWHGWR),7&RUELRWLQ 7DEOHVDQG 

7DEOH)OXRUHVFHQWSUREHVXVHGWRLQYHVWLJDWHPHPEUDQHLQWHJULW\

'\H &KDUDFWHULVWLFV
0HPEUDQHSHUPHDQWHVWHUDVHVXEVWUDWHFOHDYHGE\HVWHUDVHLQOLYLQJ
&DOFHLQ$0 FHOOVWR\LHOGFDOFHLQZKLFKIOXRUHVFHVJUHHQLQWKHF\WRSODVP
(WKLGLXP +LJKDIILQLW\UHGIOXRUHVFHQWQXFOHLFDFLGVWDLQZKLFKSHQHWUDWHV
KRPRGLPHU PHPEUDQHRIGHDGEXWQRWOLYHFHOOV
5HGIOXRUHVFHQWQXFOHLFDFLGVWDLQZKLFKSHQHWUDWHVPHPEUDQHRIGHDG
3URSLGLXPLRGLGH EXWQRWOLYHFHOOV
*UHHQIOXRUHVFHQWPHPEUDQHVWDLQZKLFKFDQEHXVHGLQFRPELQDWLRQ
ZLWKSURSLGLXPLRGLGHIRUFHOOPHGLDWHGF\WRWR[LFLW\DVVD\VVWXG\LQJ
'L2& PHPEUDQHLQWHJULW\
&KURPDWLGHŒ
%2',3<)Š/
G873 0ROHFXODU
3UREHV  )OXRUHVFHQWODEHOOHGQXFOHRWLGHXVHGLQ781(/DVVD\
$QQH[LQ9ELQGVWRSKRVSKDWLG\OVHULQHDQGIOXRUHVFHQWODEHODOORZV
GHPRQVWUDWLRQRIWUDQVIHURISKRVSKDWLG\OVHULQHIURPLQQHUWRRXWHU
$QQH[LQ9),7& SODVPDPHPEUDQHZKLFKLVDIHDWXUHRIDSRSWRVLV
&\48$17Œ*5
0ROHFXODU 3URSULHWDU\JUHHQIOXRUHVFHQWG\HZKLFKVKRZVHQKDQFHGIOXRUHVFHQFH
3UREHV  ZKHQERXQGWRFHOOXODUQXFOHLFDFLGV


6XUYLYDO UHSURGXFWLYHLQWHJULW\ 

6XUYLYDODVVD\VJLYHDGLUHFWPHDVXUHRIUHSURGXFWLYHFHOOGHDWKE\PHDVXULQJSODWLQJ
HIILFLHQF\ HLWKHU LQ PRQROD\HU RU LQ VRIW DJDU 7KH HQGSRLQWV GHVFULEHG LQ WKH SUHYLRXV
VHFWLRQ FDQ DOVR EH XVHG DV DQ LQGH[ RI UHSURGXFWLYH LQWHJULW\ SURYLGLQJ WKH GHVLJQ RI WKH
DVVD\LQFRUSRUDWHVDUHFRYHU\SHULRG


Ϯϭϭ

&ORQLQJLQPRQROD\HU

&HOOVJHQHUDOO\KDYHDKLJKHUFORQLQJHIILFLHQF\LQPRQROD\HUWKDQLQVRIWDJDU1RUPDO
FHOOV DQG WXPRXU FHOOV ZLOO IRUP FRORQLHV LQ PRQROD\HU DQG WKH PHWKRG LV QRW WKHUHIRUH
DSSOLFDEOH WR WXPRXU ELRSV\ PDWHULDO XQOHVV FULWHULD DUH DYDLODEOH WR GLVFULPLQDWH EHWZHHQ
WXPRXUDQGQRQWXPRXUFHOOV)HHGHUOD\HUVRILUUDGLDWHGRUPLWRP\FLQ&WUHDWHGFHOOVFDQEH
XVHGWRLQFUHDVHSODWLQJHIILFLHQFLHVDQGLQGHHGVPDOOGUXJUHVLVWDQWIUDFWLRQVDUHPRUHOLNHO\
WREHGHWHFWHGLQWKHLPSURYHGFXOWXUHFRQGLWLRQVH[LVWLQJZKHQIHHGHUFHOOVDUHXVHG

6SKHURLGV

9DULRXV PHWKRGV FDQ EH XVHG WR TXDQWLWDWH WKH HIIHFW RI GUXJV RQ VSKHURLG JURZWK
7KHVHDUH

x UHODWLYHFKDQJHVLQYROXPHRIWUHDWHGDQGXQWUHDWHGVSKHURLGV
x FORQLQJHIILFLHQF\LQVRIWDJDURIGLVDJJUHJDWHGVSKHURLGV
x FHOOSUROLIHUDWLRQIURPVSKHURLGVDGKHUHQWWRFXOWXUHVXUIDFHV

7KHILUVWPHWKRGLVUDWKHULQVHQVLWLYHEHFDXVHVSKHURLGJURZWKWHQGVWRSODWHDXDQGWKH
VHFRQGPD\EHDIIHFWHGE\GLIILFXOWLHVZLWKGLVDJJUHJDWLRQWRDVLQJOHFHOOVXVSHQVLRQDQGORZ
SODWLQJHIILFLHQFLHV

&HOOSUROLIHUDWLRQ

*URZWK FXUYHV PD\ EH GHWHUPLQHG DQG WKH GRXEOLQJ WLPH GXULQJ H[SRQHQWLDO JURZWK
GHULYHG$QLQFUHDVHLQGRXEOLQJWLPHLVWDNHQDVDQLQGLFDWLRQRIF\WRWR[LFLW\EXWLWPXVWEH
VWUHVVHG WKDW WKLV LV D NLQHWLF PHDVXUHPHQW DYHUDJHG RYHU WKH ZKROH SRSXODWLRQ DQG FDQQRW
GLVWLQJXLVKEHWZHHQDUHGXFHGJURZWKUDWHRIDOOFHOOVDQGDQLQFUHDVHLQFHOOORVVDWHDFKFHOO
JHQHUDWLRQ (VWLPDWHV RI F\WRWR[LFLW\ EDVHG RQ FHOO JURZWK LQ PDVV FXOWXUH PXVW XWLOL]H WKH
ZKROHJURZWKFXUYHRUWKH\PD\EHRSHQWRPLVLQWHUSUHWDWLRQ,IRIFHOOVGLHDWWKHVWDUW
RIWKHH[SHULPHQWWKHJURZWKUDWHRIWKHUHVLGXHGHWHUPLQHGLQORJSKDVHPD\EHWKHVDPH
EXWZLOOVKRZDGHOD\,QSUDFWLFHLW LVGLIILFXOWWRGLVWLQJXLVKEHWZHHQHDUO\FHOOORVVDQGD
SURORQJHGODJSHULRG&HOOJURZWKUDWHVPXVWEHWDNHQDVRQO\DURXJKJXLGHWRF\WRWR[LFLW\
DQGDFFXUDWHPHDVXUHPHQWVRIFHOOVXUYLYDODQGFHOOSUROLIHUDWLRQVKRXOGEHPDGHE\FRORQ\
IRUPLQJHIILFLHQF\ VXUYLYDO DQGFRORQ\VL]H SUROLIHUDWLRQ 

$VVD\FRPSDULVRQV
,Q VSLWH RI WKH GLYHUVLW\ RI PHWKRGRORJLHV XVHG IRU F\WRWR[LFLW\ DQG YLDELOLW\ WHVWLQJ
DSSUR[LPDWHO\WKHVDPHOHYHOVRIFRUUHODWLRQEHWZHHQLQYLWURVHQVLWLYLW\DQGLQYLYRUHVSRQVH
KDYHEHHQUHSRUWHGZKHQWKHPHWKRGVKDYHEHHQDSSOLHGWRKXPDQWXPRXUELRSV\PDWHULDO$
QXPEHU RI FRPSDUDWLYH VWXGLHV KDYH EHHQ XQGHUWDNHQ ZKLFK JHQHUDOO\ LQGLFDWH WKDW
DSSURSULDWHO\ GHVLJQHGF\WRWR[LFLW\ DVVD\V JLYH UHVXOWV ZKLFK DUH FRPSDUDEOHWRFORQRJHQLF
DVVD\V7KHUHODWLYHPHULWVRIFORQRJHQLFDQGQRQFORQRJHQLFDVVD\VKDYHEHHQGLVFXVVHGDQG
UHYLHZHG

,QWHUSUHWDWLRQRIUHVXOWV
5HODWLRQVKLSEHWZHHQFHOOQXPEHUDQGF\WRWR[LFLW\LQGH[

7KHYDOLGLW\RIDF\WRWR[LFLW\LQGH[LVGHSHQGHQWXSRQWKHGHJUHHRIOLQHDULW\EHWZHHQ
FHOO QXPEHU DQG WKH FKRVHQ HQGSRLQW DQG WKLV VKRXOG EH FRQILUPHG IRU DQ\ F\WRWR[LFLW\

ϮϭϮ

DVVD\,QFORQRJHQLFDVVD\VDOLQHDUUHODWLRQVKLSPD\QRWRFFXUDWORZFHOOQXPEHUVGXHWRWKH
GHSHQGHQFH RI FORQRJHQLF JURZWK RQ FRQGLWLRQLQJ IDFWRUV ZKLOVW DW KLJK FHOO GHQVLWLHV
OLQHDULW\LVORVWGXHWRQXWULWLRQDOGHILFLHQFLHV,QF\WRWR[LFLW\DVVD\VOLQHDULW\PD\EHORVWDW
WKHXSSHUHQGGXHWRGHQVLW\GHSHQGHQWLQKLELWLRQRIWKHUHOHYDQWPHWDEROLFSDWKZD\ZKLOVW
WKH VHQVLWLYLW\ OLPLW RI WKH DVVD\ PD\ DIIHFW OLQHDULW\ DW WKH ORZHU HQG 7KLV ZRXOG FDXVH
DSSDUHQW VWLPXODWLRQ DW ORZ GUXJ OHYHOV DQG DQ RYHUHVWLPDWLRQ RI FHOO NLOO DW KLJKHU
FRQFHQWUDWLRQV&RQWUROFHOOQXPEHUVDWWKHHQGRIWKHDVVD\PXVWWKHUHIRUHIDOORQWKHOLQHDU
SRUWLRQRIWKHFXUYH7KHDFFXUDF\DWKLJKHUOHYHOVRIFHOONLOOLVGHSHQGHQWRQWKHUDQJHRYHU
ZKLFK OLQHDULW\ H[WHQGV DQG LQIOXHQFHV WKH QXPEHU RI GHFDGHV RI FHOO NLOO ZKLFK FDQ EH
PHDVXUHG,IUHVXOWVDUHSORWWHGRQDORJVFDOHWKLVPD\LPSO\WKDWWKHDVVD\LVDFFXUDWHGRZQ
WRWKUHHRUIRXUGHFDGHVRIFHOONLOOZKLFKVKRXOGEHFRQILUPHGEHIRUHH[SUHVVLQJUHVXOWVLQ
WKLVZD\7KLVLVSDUWLFXODUO\LPSRUWDQWLQLQYLWURGUXJFRPELQDWLRQVWXGLHVZKHQV\QHUJLVP
RUDGGLWLYLW\LVRIWHQREVHUYHGEH\RQGWKHVHFRQGGHFDGHRIFHOONLOO

'RVHUHVSRQVHFXUYHV

5HVXOWV DUH FRPPRQO\ SORWWHG DV GRVHUHVSRQVH FXUYHV XVLQJ D OLQHDU VFDOH IRU
SHUFHQWDJH LQKLELWLRQ RI LVRWRSH LQFRUSRUDWLRQ IRU H[DPSOH  DQG D ORJ VFDOH IRU VXUYLYLQJ
IUDFWLRQRQFORQRJHQLFWHVWV$VVD\YDULDWLRQIRUUHSOLFDWHSRLQWVLVURXWLQHO\GHSLFWHGDVPHDQ
“VWDQGDUGGHYLDWLRQDPLQLPXPRIWKUHHUHSOLFDWHVLVWKHUHIRUHUHTXLUHGIRUHDFKWHVWSRLQW
6RPHPHWKRGLVUHTXLUHGIRUGHILQLQJWKHVHQVLWLYLW\RIDFHOOSRSXODWLRQLQUHODWLRQWRRWKHU
FHOOSRSXODWLRQVRUGLIIHUHQWWHVWFRQGLWLRQVVHYHUDOSDUDPHWHUVDUHDYDLODEOHDQGDUHVKRZQ
LQ)LJXUH

$UHDXQGHUFXUYHPHWKRG

7KH XVH RI WKLV PHWKRG DFNQRZOHGJHV WKH SUREDELOLW\ WKDW WKH VKDSH RI WKH GRVH
UHVSRQVHFXUYHPD\EHLQVWUXPHQWDOLQLQIOXHQFLQJWKHRXWFRPHRIGUXJH[SRVXUHUDWKHUWKDQ
FHOONLOODWDQ\RQHFRQFHQWUDWLRQ,WLVFDOFXODWHGXVLQJWKHWUDSH]RLGDOPHWKRGZKLFKDGGVWKH
DUHDRIUHFWDQJOHVDQGWULDQJOHVXQGHUWKHVXUYLYDOFXUYH7KHPHWKRGKDVEHHQDSSOLHGPRVW
H[WHQVLYHO\LQWKH KXPDQWXPRXUVWHPFHOODVVD\ 6RPHGUXJVGRQRWSURGXFHFXUYHVZLWKDQ
HDVLO\GHILQHG,&YDOXHDQG$8&PD\SURYLGHDPRUHHDVLO\TXDQWLILDEOHUHVXOW


&XWRIISRLQWVIRUGHILQLWLRQRIVHQVLWLYLW\DQGUHVLVWDQFH

,ISORWVRIGRVHUHVSRQVHFXUYHVIURPFRPSDULVRQVRIFHOOOLQHVVKRZWKDWWKH\PDLQWDLQ
WKHLU UHODWLYH VHQVLWLYLW\ UDQNLQJV DW GLIIHUHQW FRQFHQWUDWLRQV LH FURVVLQJRYHU RI GRVH
UHVSRQVH FXUYHV LV PLQLPDO  WKHQ LQIRUPDWLRQ RQ WKH UHODWLYH VHQVLWLYLWLHV RI GLIIHUHQW FHOO
OLQHV FDQ EH REWDLQHG E\ GHILQLQJ VHQVLWLYLW\ DW RQH FRQFHQWUDWLRQ DQG WKLV LV WKH PRVW
FRPPRQO\ XVHG PHWKRG IRU LQ YLWUR SUHGLFWLYH WHVWLQJ :KHQ UHWURVSHFWLYH FRUUHODWLRQV
EHWZHHQLQYLWURGDWDDUHPDGHIRUGHILQLQJWKHVHFXWRIISRLQWVDQLQWHUPHGLDWH]RQHLVIRXQG
ZKHUHWXPRXUVFDQQRWEHGHILQHGDVVHQVLWLYHRUUHVLVWDQWDQGWKHUHLVQRFOHDUFXWFRUUHODWLRQ
EHWZHHQ LQ YLWUR UHVXOWV DQG FOLQLFDO UHVSRQVH 7KH VL]H RI WKH LQWHUPHGLDWH ]RQH ZLOO EH DW
OHDVWSDUWO\UHODWHGWRWKHLQKHUHQWYDULDELOLW\RIWKHDVVD\ODUJHU]RQHVEHLQJDVVRFLDWHGZLWK
KLJKHU VWDQGDUG GHYLDWLRQV $OWKRXJK VHQVLWLYLW\ PD\ EH GHILQHG DW RQH FRQFHQWUDWLRQ LW LV
UHFRPPHQGHG WKDW PRUH WKDQ RQH FRQFHQWUDWLRQ LV WHVWHG SDUWLFXODUO\ LQ WKH GHYHORSPHQWDO
VWDJHRIWKHDVVD\

,'DQG,'YDOXHV

Ϯϭϯ

 &HOO VHQVLWLYLW\ PD\ DOVR EH GHILQHG E\ WKH ,' DQG ,' YDOXHV LH GUXJ
FRQFHQWUDWLRQUHTXLUHGWRLQKLELWYLDELOLW\E\RU 7KHVHYDOXHVPD\DOVREHWHUPHG
,& LQKLELWRU\ FRQFHQWUDWLRQ  /& OHWKDOFRQFHQWUDWLRQ  RU *, JURZWK LQKLELWLRQ  EXW WKH\
DUHDOOGHWHUPLQHGLQWKHVDPHZD\

&RUUHODWLRQEHWZHHQLQYLWURDQGLQYLYRUHVXOWV

&ULWHULD IRU GHILQLQJ WXPRXUV DV VHQVLWLYH RU UHVLVWDQW DUH EDVHG RQ UHWURVSHFWLYH
FRUUHODWLRQVEHWZHHQLQYLWURUHVXOWVDQGFOLQLFDOUHVSRQVHVXVLQJDWUDLQLQJVHWRIGDWD(YHQ
ZKHQ D ODERUDWRU\ LV XVLQJ DQ HVWDEOLVKHG PHWKRG IRU WXPRXU VHQVLWLYLW\ WHVWLQJ RZQ
ODERUDWRU\ VHWVRIWUDLQLQJGDWDVKRXOGEHREWDLQHGWRDOORZIRULQWHUODERUDWRU\YDULDWLRQ7KH
UHVSRQVHRISDWLHQWVZLWKWXPRXUVRILQWHUPHGLDWHVHQVLWLYLW\PD\EHLQIOXHQFHGE\SURJQRVWLF
IDFWRUVRWKHUWKDQWXPRXUVHQVLWLYLW\ HJWXPRXUEXUGHQDWRQVHWRIFKHPRWKHUDS\VWDJHRI
GLVHDVH KLVWRORJ\ WXPRXU FHOO GRXEOLQJ WLPH SUHYLRXV FKHPRWKHUDS\ DQG SHUIRUPDQFH
VWDWXV :KHQDQDO\VLQJUHVXOWVIRUFRUUHODWLRQVVRPHDWWHPSWWRVWUDWLI\SDWLHQWVDFFRUGLQJWR
WKHVH SDUDPHWHUV PD\DVVLVW LQ SURYLGLQJPRUH PHDQLQJIXO GDWD 4XDQWLWDWLYHDVVHVVPHQWRI
WXPRXU UHVSRQVH LV DOVR RI SDUDPRXQW LPSRUWDQFH ,W LV SRLQWHG RXW WKDW LQ YLWUR
FKHPRVHQVLWLYLW\ FDQ EH H[SHFWHG RQO\ WR LQGLFDWH WKDW VRPH GHJUHH RI FHOO NLOO ZLOO EH
DFKLHYHGLQYLYRQRWWKDWWKHSDWLHQWZLOODFKLHYHDFRPSOHWHUHVSRQVHWRWUHDWPHQW7KHWUXH
SRVLWLYHFRUUHODWLRQUDWHRIDQDVVD\LVGHILQHGDV


ZKHUHWKHQXPHUDWRURIHDFKIUDFWLRQLVWKHLQYLWURWHVWUHVSRQVH W DQGWKHGHQRPLQDWRULV
W W
WKHLQYLYRSDWLHQWUHVSRQVH S 6 DQG5 DUHUHVSHFWLYHO\WKHQXPEHURIWXPRXUVVKRZLQJLQ
YLWUR VHQVLWLYLW\ RU UHVLVWDQFH DFFRUGLQJ WR WKH VHOHFWHG FXWRII SRLQWV 6S DQG 5S DUH
UHVSHFWLYHO\WKHQXPEHURISDWLHQWVDFKLHYLQJDFOLQLFDOUHVSRQVHRUQRFOLQLFDOUHVSRQVHWRWKH
GUXJWHVWHGLQYLWUR7KHWUXHQHJDWLYHUDWHLVGHILQHGDV


,QDVVHVVLQJWKHVLJQLILFDQFHRIWKHFRUUHODWLRQUDWHVREWDLQHGWKHVHVKRXOGEHFRPSDUHG
ZLWK WKH FRUUHODWLRQ UDWHV ZKLFK ZRXOG EH REWDLQHG ZHUH WKH LQ YLWUR UHVXOWV UDQGRPO\
GLVWULEXWHG)RUH[DPSOHDGUXJJLYHVDUHVSRQVHUDWHLQYLYRDQGRIWXPRXUVVKRZ
LQ YLWUR VHQVLWLYLW\ WR WKLV GUXJ ,I WKH LQ YLWUR UHVXOWV DUH UDQGRPO\ GLVWULEXWHG EHWZHHQ
VHQVLWLYLW\ DQG UHVLVWDQFH WKHQ WKH FKDQFHV RI REWDLQLQJ D SRVLWLYH FRUUHODWLRQ EHWZHHQ LQ
YLWURVHQVLWLYLW\DQGLQYLYRUHVSRQVHDUHRI LH DQGRIREWDLQLQJDSRVLWLYH
FRUUHODWLRQ EHWZHHQ LQ YLWURUHVLVWDQFH DQG LQYLYR UHVLVWDQFH 7KH RYHUDOO DSSDUHQW SRVLWLYH
FRUUHODWLRQUDWHLVWKHUHIRUH,QYLWURYHUVXVLQYLYRFRUUHODWLRQVDUHDOVRFRPSOLFDWHGE\
WKH XVH RI FRPELQDWLRQ UHJLPHV WR WUHDW SDWLHQWV 6WULFWO\ VSHDNLQJ FRUUHODWLRQV VKRXOG EH
PDGHRQO\ZKHQLQYLWURGDWDLVDYDLODEOHIRUDOOGUXJVXVHG:KHWKHURUQRWWKH\DUHWHVWHGLQ
FRPELQDWLRQ GHSHQGV RQ WKH WUHDWPHQW SURWRFRO EHFDXVH VRPH GUXJV DUH DGPLQLVWHUHG
VHTXHQWLDOO\ $OVR LI WKH DVVD\ FDQ RQO\ PHDVXUH WZR GHFDGHV RI FHOO NLOO LW PD\ EH WRR
LQVHQVLWLYHWRGHWHFWDGGLWLYHRUV\QHUJLVWLFHIIHFWV

&RPELQDWLRQVRIGUXJV

$ZHOOSODWHFORQRJHQLFDVVD\EDVHGRQOLPLWLQJGLOXWLRQVKDVEHHQXVHGWRORRNDW
DGGLWLYHDQGVXSUDDGGLWLYH V\QHUJLVWLF HIIHFWV RI GUXJ FRPELQDWLRQV7KHGDWDLVDQDO\VHG

Ϯϭϰ

XVLQJWKHIRUPXODSODWLQJHIILFLHQF\ 3(  ,Q QXPEHURIQHJDWLYHZHOOV  WRWDOQXPEHURI
ZHOOVMQXPEHU RI FHOOV SODWHG SHU ZHOO )UDFWLRQDO VXUYLYDO GDWD DUH WKHQ ILWWHG WR WKH OLQHDU
TXDGUDWLFPRGHO
) H[S> 2W' ȕ' @DQG$8&DQDO\VHGE\QXPHULFDOLQWHJUDWLRQXVLQJDSSURSULDWH
VRIWZDUH

3LWIDOOVDQGWURXEOHVKRRWLQJ

3UREOHPVZKLFKPD\EHHQFRXQWHUHGZLWKWKHVHDVVD\VLQFOXGH
x ODUJHVWDQGDUGGHYLDWLRQV
x YDULDELOLW\EHWZHHQDVVD\VGRQHRQWKHVDPHFHOOSRSXODWLRQ
x VWLPXODWLRQWRDERYHFRQWUROOHYHOV

/DUJHVWDQGDUGGHYLDWLRQV
3RVVLEOHUHDVRQVIRUODUJHVWDQGDUGGHYLDWLRQVLQFOXGH
x )DXOWV LQ DOLTXRWLQJ FHOO VXVSHQVLRQ ZKLFK DUH PRVW OLNHO\ WR EH PDGH GXH WR
LQDGHTXDWHPL[LQJRIFHOOVXVSHQVLRQGXULQJGLVSHQVLQJOHDGLQJWRXQHYHQGLVWULEXWLRQ
RIFHOOVEHWZHHQUHSOLFDWHV
x 7KH SUHVHQFH RI ODUJH FHOO DJJUHJDWHV LQ WKH RULJLQDO FHOO VXVSHQVLRQ OHDGLQJ WR
XQHYHQGLVWULEXWLRQRIFHOOVEHWZHHQUHSOLFDWHV
x 1RQVSHFLILFLW\ RI F\WRWR[LFLW\ HQGSRLQW HJ GXH WR PHDVXUHPHQW RI QRQVSHFLILF
ELQGLQJRIUDGLRDFWLYLW\

9DULDWLRQEHWZHHQDVVD\V

5HSOLFDWH DVVD\V RQ GLIIHUHQW GD\V FDQQRW EH SHUIRUPHG RQ KXPDQ WXPRXU ELRSV\
PDWHULDOWRFKHFNGD\WRGD\UHSURGXFLELOLW\EXWWKLVFDQEHHYDOXDWHGXVLQJFHOOOLQHV,WLVD
UHFRJQL]HG SUREOHP WKDW FHOO OLQHV ZKLFK VKRZ FRQVLVWHQW VHQVLWLYLW\ SURILOHV PD\ VKRZ
GHYLDQW  UHVXOWV RFFDVLRQDOO\ IRU UHDVRQV ZKLFK FDQQRW EH LGHQWLILHG 6SHFLILF UHDVRQV IRU
IDLOXUHWRREWDLQUHSURGXFLEOHUHVXOWVPD\LQFOXGH

x )DLOXUH WR KDUYHVW WKH FHOO SRSXODWLRQ DW DQ LGHQWLFDO WLPH SRLQW HJ H[SRQHQWLDO
JURZWKYHUVXVHDUO\FRQIOXHQFHYHUVXVODWHFRQIOXHQFH 
x 'HWHULRUDWLRQRIVWRFNGUXJVROXWLRQV
x :KHQ GUXJ VROXWLRQV KDYH D VKRUW KDOIOLIH WKH\ PXVW EH XVHG LPPHGLDWHO\ DIWHU
GLOXWLQJWRHQVXUHFRQVLVWHQF\LQWKHGUXJOHYHOVDYDLODEOHWRFHOOVLQHDFKDVVD\
x )DLOXUHWRVWDQGDUGL]HLQFXEDWLRQFRQGLWLRQV

7KH DVVD\ V\VWHP PXVW EH FKHFNHG IRU UHSURGXFLELOLW\ EHIRUH DSSO\LQJ LW WR KXPDQ
ELRSV\PDWHULDO

6WLPXODWLRQWRDERYHFRQWUROOHYHOV

6WLPXODWLRQ FDQ EH D WUXH PHDVXUH RI FHOOXODU HYHQWV EXW PD\ EH GXH WR WHFKQLFDO
DUWHIDFWV7KHVHLQFOXGH

D 1RQVSHFLILFELQGLQJRIUDGLRDFWLYLW\
E  'HQVLW\GHSHQGHQWLQKLELWLRQ RI PHWDEROLF SDWKZD\V LQ FRQWUROV ZKLFK LV QRW HYLGHQW LQ
WHVWVLWXDWLRQVZKHUHVRPHFHOONLOOKDVEHHQDFKLHYHG

Ϯϭϱ

 F  6WLPXODWLRQ RI XSWDNH RI PHWDEROLF SUHFXUVRUV E\ DQWLPHWDEROLWHV HJ WK\PLGLQH E\
IOXRURXUDFLODQGPHWKRWUH[DWH 


)LJXUH7KHHIIHFWRIJURZWKXQLWVL]HRQWKHVXUYLYDOFXUYHVRIDPXULQHPHODQRPD
FHOO OLQH &&/  WR PHOSKDODQ D  DQG RI D KXPDQ PHODQRPD ELRSV\ WR DFWLQRP\FLQ ' E 
*URZWK XQLW VL]H DQG IUHTXHQF\ ZDV PHDVXUHG XVLQJ )$6 ,, DXWRPDWHG LPDJH DQDO\VLV
V\VWHP‡XP2XP‡DXUQ'D XP0HDQ“VHVKRZQ

3ODWHG FHOO GHQVLW\ LQIOXHQFHV WKH GLVWULEXWLRQ LQ VL]H RI JURZWK XQLWV LQ FORQRJHQLF
DVVD\VZLWKODUJHXQLWVGHFUHDVLQJDVSODWHGFHOOQXPEHUVLQFUHDVH7KHHIIHFWRIWKLVRQGUXJ
VHQVLWLYLW\ SURILOHV ZDV H[DPLQHG DQG DV H[SHFWHG WKH GRVHUHVSRQVH FXUYH ZDV VWURQJO\
LQIOXHQFHG E\ WKH VL]H FULWHULRQ XVHG IRU FRORQ\ VFRULQJ ZLWK VWLPXODWLRQ WR DERYH FRQWURO
OHYHOVRFFXUULQJZKHQODUJHFRORQLHVZHUHVFRUHG )LJXUH 

5HIHUHQFHV

$JUH]0:.RYDFK-6DQG/LHEHU00  %U-&DQFHU
$OEHUWV'6DQG&KHQ+6*  ,Q&ORQLQJRIKXPDQWXPRXUVWHPFHOOV HG6(
6DOPRQ $SSHQGL[$ODQ5/LVV1HZ<RUN
$OEHUWV'6*HRUJH&KHQ+6DQG6DOPRQ6(  ,Q&ORQLQJRIKXPDQWXPRXU
VWHPFHOOV HG6(6DOPRQ S$ODQ5/LVV1HZ<RUN
$WWHUZLOO & . DQG 6WHHOH & ( HG    ,Q YLWUR PHWKRGV LQ WR[LFRORJ\ &DPEULGJH
8QLYHUVLW\3UHVV
%DNHU)/$MDQL-6SLW]HU*7RPDVRYLF%-:LOOLDPV0)LQGHUV0HWDO  
,QW-&HOO&ORQLQJ
%DOPDLQ$DQG%URZQ.  $GY&DQFHU5HV
%DUUDQFR6&%ROWRQ:(DQG1RYDN-.  -1DW&DQFHU,QVW
%HJXH - 0 /H %LJRW - ) *XJXHQ*XLOORX]R & .LHFKHO - 5 DQG *XL8RX]R $
 %LRFKHP3KDUPDFRO
%HUHQEDXP0&  /DQFHWLL
%HUWRQFHOOR/HWDO  %U-&DQFHU
%LFNLV,-+HQGHUVRQ,:'DQG4XDVWHO-+  &DQFHU
%RVDQTXHW$*  %U-&DQFHU
%RVDQTXHW$*DQG%HOO3%  /HXNHPLD5HV
%UDGIRUG00  $QDO%LRFKHP

Ϯϭϲ

%XVNLUN++&ULP-$9DQ*LHVVHQ*-DQG 3HWHULQJ + *   1DW &DQFHU
,QVW
&DUPLFKDHO - 'H*UDII : * *D]GDU $ ) 0LQQD - ' DQG 0LWFKH8 - %  
&DQFHU5HV
&KHQHU\ 5 -   ,Q ,Q YLWUR PHWKRGV LQ WR[LFRORJ\ HG & . $WWHUZLOO DQG & (
6WHHOH S&DPEULGJH8QLYHUVLW\3UHVV
&ROH63&  &DQFHU&KHPRWKHU3KDUPDFRO
&RVPD*1DQG:HQ]HO'*  @7LVVXH&XOWXUH0HWKRGV
&RXUWHQD\9'DQG0LOOV-  %U-&DQFHU
&RXUWHQD\9'DQG0LOOV-  %U-&DQFHU
&UHH,$  0HWKRGV0RO%LRO
'DYLHV ' 6 DQG %RRELV $ 5   ,Q $QLPDOV LQ VFLHQWLILF UHVHDUFK DQ HIIHFWLYH
VXEVWLWXWHIRUPDQ" HG37XUQHU S0DFPLOODQ/RQGRQ
'HQG\ 3 3 HG    +XPDQ WXPRXUV LQ VKRUWWHUP FXOWXUH WHFKQLTXHV DQG FOLQLFDO
DSSOLFDWLRQ$FDGHPLF3UHVV1HZ<RUN
'HQG\ 3 3 DQG +LOO % 7 HG    +XPDQ WXPRXU GUXJ VHQVLWLYLW\ WHVWLQJ LQ YLWUR
WHFKQLTXHVDQGFOLQLFDODSSOLFDWLRQV$FDGHPLF3UHVV1HZ<RUN
'HQG\ 3 3 'DZVRQ 0 3 $ :DUQHU ' 0 $ DQG +RQHVV ' -   ,Q +XPDQ
WXPRXUVLQVKRUWWHUPFXOWXUHWHFKQLTXHVDQGFOLQLFDODSSOLFDWLRQV HG33'HQG\ S
$FDGHPLF3UHVV1HZ<RUN
'HQL]RW)DQG/DQJ5  -,PPXQRO0HWKRGV
'HQW0)+XEEROG/5DGIRUG+DQG:LOVRQ$3  &\WRWHFKQRORJ\
'HQW0)+XEEROG/5DGIRUG+DQG:LOVRQ$3  &\WRWHFKQROSJ\
'LFNVRQ - $ DQG 6X]DQJHU 0   ,Q +XPDQ WXPRXUV LQ VKRUWWHUP FXOWXUHV
WHFKQLTXHVDQGFOLQLFDO$DSSOLFDWLRQV HG33'HQG\ S$FDGHPLF3UHVV1HZ
<RUN
'L[RQ5$/LQFK'%DLQHV3DQG5RVHQGDDO0  ([S&HOO5HV
'XUNLQ : - *KDQWD 9 . %DOFK & 0 'DYLV ' : DQG +LUDPRWR 5 1  
&DQFHU5HV
(DJOH+DQG)ROH\*(  $P-0HG
(GZDUGV$-DQG5RZODQGV*)  %U-6XUJ
(QJEORP35DQWDQHQ9.XOPDOD-+HOHQLXV+DQG*UHQPDQ5  %U-&DQFHU

)LHQQHV$*7::DOWRQ-:LQWHUERXUQH'0F*,DVKDU'DQG+HQQRQ7D\ORU-
 &HOO%LRO,QW5HS
)ROH\*(DQG(SVWHLQ66  $GY&KHPRWKHU
)RUEHV/-  $XVW-([S%LG
)UHVKQH\5,DQG0RUJDQ'  &HOO%LRO,QW5HS
)UHVKQH\5,&HOLN)DQG0RUJDQ'  ,Q 7KHFRQWURO RIWXPRXU JURZWK DQG LWV
ELRORJLFDO EDVH HG : 'DYLV & 0DOWRQL DQG 6W 7DQQHEHUJHU  )RUWVFKULWWH LQ GHU
2QNRORJLH%DQG%HUOLQ$NDGHPLH9HUODJ
)UHVKQH\5,3DXO-DQG.DQH/0  %U-&DQFHU
)ULFNHU6  %$&50HHWLQJ3RVWHU
)ULHGPDQ+0DQG*ODXELJHU'/  &DQFHU5HV
)U\-5   ,Q $QLPDOV LQVFLHQWLILF UHVHDUFK DQHIIHFWLYHVXEVWLWXWHIRUPDQ" HG3
7XUQHU S0DFPLOODQ/RQGRQ
*HOOKRUQ$DQG+LUVFKEHUJ(  &DQFHU5HV6XSSO
*UHQPDQ 5 %XUN ' 9LURODLQHQ ( %XLFN 5 1 &KXUFK - 6FKZDUW] ' 5 HW DO
 ,QW-&DQFHU
*UXQLFNH++LUVFK):ROI+%DXHU9DQG.LHIHU*  ([S&HOO5HV

Ϯϭϳ

*XLOORX]R $ DQG *XJXHQ*XLOORX]R & HG    5HVHDUFK LQ LVRODWHG DQG FXOWXUHG
KHSDWRF\WHV-RKQ/LEEH\(XURWH[W/WG,16(50/RQGRQ
*XLOORX]R$%HDXQH3*DVFRLQ01%HJXH-0&DPSLRQ-3*XHQJHULFK3)
HWDO  %LRFKHP3KDUPDFRO
*XSWD9DQG.ULVKQDQ$  &DQFHU5HV
+DNDOD 0 , DQG 5XVWUXP < 0   ,Q 0HWKRGV LQ FDQFHU UHVHDUFK FDQFHU GUXJ
GHYHORSPHQW 3DUW$ HG97'H9LWDDQG+%XVFK  S $FDGHPLF 3UHVV 1HZ
<RUN
+DPEXUJHU$:6DOPRQ6(.LP0%7UHQW-06RHKQOHQ%$OEHUWV'6HW
DO  &DQFHU5HV
+DQDXVNH$5+DQDXVNH8DQG9RQ+RII''  (XU-&DQFHU&OLQ2QFRO

+DXJODQG 5 3   +DQGERRN RI IOXRUHVFHQW SUREHV DQG UHVHDUFK FKHPLFDOV WK HGQ
0ROHFXODU3UREHV
+LOO%7  ,Q+XPDQWXPRXUGUXJVHQVLWLYLW\WHVWLQJLQYLWUR HG33'HQG\DQG%
7+LOO S$FDGHPLF3UHVV1HZ<RUN
,Q$PHUVKDPUHVHDUFKQHZV  
,19,772;  7KH)5$0(F\WRWR[LFLW\WHVW,19,772;3URWRFROQXPEHU)5$0(
1RWWLQJKDP
,]VDN)&K*RWOLHE6WHPDWVN\7(\ODQ(DQG*D]LWK$  %XU-&DQFHU
-DEEDU6$%7ZHQW\PDQ35DQG:DWVRQ-9  %U-&DQFHU
-RQHV$&6WUDWIRUG/:LOVRQ3$DQG3HFNKDP0-  %U-&DQFHU
.HUU-)5:\OOLH$+DQG&XUULH$5  %U-&DQFHU
.LOEH\ % - /HJDWRU 0 1LFKROV : DQG 5DQHO & HG    +DQGERRN RI
PXWDJHQLFLW\WHVWLQJSURFHGXUHV(OVHYLHU$PVWHUGDP
.QR[38SKLOO3))U\-5%HUIRUG-DQG%DOOV0  )RRG&KHP7R[LF

.ROE$,  /DE(TXLS'LJ
.RU]HQLHZVNL&DQG&DOOHZDHUW'0  -,PPXQRO0HWKRGV
.667*URXSIRU6HQVLWLYLW\7HVWLQJRI7XPRXUV  &DQFHU
/DQGHJUHQ8  -,PPXQRO0HWKRGV
/DQH 5')HGHUPDQ')ORUD-/DQG%HFN%/   - ,PPXQRO 0HWKRGV 

/DXJKWRQ&  $QDO%LRFKHP
0DVWHUV-5:  ,Q+XPDQWXPRXUGUXJVHQVLWLYLW\WHVWLQJLQYLWUR HG3'HQG\DQG
%7+LOO S$FDGHPLF3UHVV1HZ<RUN
0F&DIIUH\ 7 $ $JDUZDO / $ DQG :HNVOHU % %   ,Q 9LWUR &HOO 'HY %LRO 

0H\VNHQV)/-U7KRPVRQ63+LFNLH5$DQG6LSHV1-  %U@&DQFHU

0RQNV $ 6FXGLHUR ' $ -RKQVRQ * 6 3DXXOO . ' DQG 6DXVYLOOH ( $  
$QWLFDQFHU'UXJ'HV
0RRQ7(  ,Q&ORQLQJRIKXPDQWXPRXUVWHPFHOOV HG6(6DOPRQ S$ODQ
5/LVV1HZ<RUN
0RUJDQ ' )UHVKQH\ 5 , 'DUOLQJ - / 7KRPDV ' * 7 DQG &HOLN )   %U -
&DQFHU
0RVPDQQ7  -,PPXQRO0HWKRGV
1HGHUPDQ 7 DQG 7ZHQW\PDQ 3   ,Q 6SKHURLGV LQ FDQFHU UHVHDUFK 0HWKRGV DQG
SHUVSHFWLYHV HG + $FNHU - &DUOVVRQ 5 'XUDQG DQG 5 0 6XWKHUODQG  &K 
6SULQJHU9HUODJ%HUOLQ

Ϯϭϴ

2\DPD9,DQG(DJOH+  3URF6RF([S%LRO0HG
3DULVK&5DQG0XLOEDFKHU$  -,PPXQRO0HWKRGV
3DUN-*.UDPHU%66WHLQEHUJ60&DUPLFKDHO-&ROOLQV-00LQQD-'HWDO
 &DQFHU5HV
3DXOO.'6KRHPDNHU5+DQG%R\G05  -+HWHURF\GLF&KHP
3HOOHWLHU%'KDLQDXW)3DXO\$DQG=DKQG-3  -%LRFKHP%LRSK\V0HWKRGV

3LHWHUV5+XLVPDQV'5/H\YD$DQG9HHUPDQ$-  %U-&DQFHU
3OXPE-$0LOUR\5DQG.D\H6%  &DQFHU5HV
3RZHUV-)DQG6ODGHN1(  &DQFHU5HV
5DLFK3&  /DQFHWL
5DPRV.DQG$FRVWD'  -7LVVXH&XOWXUH0HWKRGV
5DQWDQHQ9*UHQPDQ6.XOPDOD-DQG*UHQPDQ5  %U-&DQFHU
5RSHU35DQG'UHZLQNR%  &DQFHU5HV
5XSQLDN+7DQG+LOO%7  &HOO%LR-,QW5HS
6DOPRQ6(  ,Q&ORQLQJRIKXPDQWXPRXUFHOOV3URJUHVVLQFOLQLFDODQGELRORJLFDO
UHVHDUFK9RO HG6(6DOPRQ S$ODQ5/LVV1HZ<RUN
6DOPRQ 6 ( HG    &ORQLQJ RI KXPDQ WXPRXU VWHP FHOOV 3URJUHVV LQ FOLQLFDO DQG
ELRORJLFDOUHVHDUFK9RO$ODQ5/LVV1HZ<RUN
6LOYHVWULQL56DQILOLSSRRDQG'DLGRQH0*  ,Q+XPDQWXPRXUGUXJVHQVLWLYLW\
WHVWLQJLQYLWUR HG33'HQG\DQG%7+LOO S$FDGHPLF3UHVV1HZ<RUN
6NHKDQ 3 6WRUHQJ 5 6FXGLFUR ' 0RQNV $ 0F0DKRQ - 9LVWLFD ' HW DO  
3URF$P$VVRF&DQFHU5HV
6PLWK3.HWDO  $QDO%LRFKHP
6RQGDN9.HWDO  &DQFHU5HV
7KLOO\: *'H/XFD-*)XUWK ((+RSSH+ .DGHQ' $ .UROHQVNL - - HW DO
  ,Q &KHPLFDO PXWDJHQV HG ) - GH 6HUSHV DQG $ +RONQGHU  S  3OHQXP
3UHVV1<
7XUQHU 3 HG    $QLPDOV LQ VFLHQWLILF UHVHDUFK DQ HIIHFWLYH VXEVWLWXWH IRU PDQ"
0DFPLOODQ/RQGRQ
7YHLW.0(QGHUVHQ/5XJVWDG+()RGVWDG2DQG3LKO$  %U-&DQFHU

9HULWW 6 DQG 3DUU\ - 0 HG    0XWDJHQLFLW\ WHVWLQJ D SUDFWLFDO DSSURDFK ,5/
2[IRUG
9ROP0:D\VV..DXIPDQQ0DQG0DWWHUQ-  (XU-&DQFHU
9RQ+RII''HWDO  &DQFHU5HV
9RQ+RII''HWDO  -&OLQ2QFRO
9RQ +RII'' )RUVHWK % - +XRQJ 0 %XFKRN - % DQG /DWKDQ %   &DQFHU
5HV
:HLVHQWKDO/0DQG0DUVGHQ-  3URF$P$VVRF&DQFHU5HV
:HLVHQWKDO/0DQG/LSSPDQ0(  &DQFHU7UHDW5HS
:HLVHQWKDO/0'LOO3/.XUQLFN1%DQG/LSSPDQ0(  &DQFHU5HV

:LOVRQ$3DQG1HDO)(  %U-&DQFHU
:LOVRQ$3)RUG&+-1HZPDQ&+DQG+RZHOO$  %U-&DQFHU
:ULJKW-&&REE-3*XPSRUW6/*RORPE)0DQG6DIDGL'  1(QJO-
0HG




Ϯϭϵ

 &KDSWHU

*HQHWLF(QJLQHHULQJ

,QWURGXFWLRQ

7RH[SORUHWKHUROHRIDJHQHZHQHHGWRDQDO\VHLWVUHJXODWLRQDQGH[SUHVVLRQGXULQJ
DQG DIWHU GHYHORSPHQW WKH IXQFWLRQ RI LWV SURGXFW DQG LQWHUDFWLRQV ZLWK RWKHU SURWHLQV ,Q
PRVWFDVHVLWLVQHFHVVDU\WREHDEOHWRWUDQVIHUWKHJHQHRULWVPDQLSXODWHGIRUPLQWRFHOOV
+RZHYHU DV PDPPDOLDQ FHOOV GR QRW WDNH XS IRUHLJQ '1$ HIILFLHQWO\ WKH DYDLODELOLW\ RI
HIIHFWLYH PHWKRGV IRU LQWURGXFLQJ JHQHV LQWR WKH FHOOV LV HVVHQWLDO 0DQ\ JHQH WUDQVIHU
PHWKRGVKDYHEHHQGHYHORSHGWKDWDUHURXWLQHO\XVHGE\VFLHQWLVWVVWXG\LQJPDPPDOLDQFHOOV
0RUHRYHUZLWKWKHDGYDQFHPHQWRIUHFRPELQDQW'1$WHFKQRORJ\JHQHWUDQVIHUWHFKQLTXHV
KDYH EHFRPH SRZHUIXO WRROV LQ JHQH FORQLQJ DQG PDSSLQJ FRQVWUXFWLRQ RI WUDQVJHQLF
DQLPDOVDQGJHQHWKHUDS\

,Q WKLV FKDSWHU VRPH RI WKH PRVW FRPPRQO\ XVHG PHWKRGV IRU LQWURGXFLQJ JHQHV LQWR
PDPPDOLDQ FHOOV LQFOXGLQJ WUDQVIHFWLRQ E\ FDOFLXP SKRVSKDWH SUHFLSLWDWLRQ DQG FDWLRQLF
OLSLGV HOHFWURSRUDWLRQ DQG WKH WHFKQLTXHV RI PLFURFHOOPHGLDWHG FKURPRVRPH WUDQVIHU DQG
LUUDGLDWLRQIXVLRQJHQHWUDQVIHUZLOOEHGLVFXVVHG2WKHUWHFKQLTXHVRIJHQHGHOLYHU\ZKLFK
DUHQRWGLVFXVVHGKHUHLQFOXGH'($(GH[WUDQQHXWUDOL]DWLRQPLFURLQMHFWLRQRI'1$GLUHFWO\
LQWRWKHFHOOVDQGWKHXVHRIYLUDOYHFWRUV
'XHWRWKHLUYHUVDWLOLW\DQGHIILFLHQF\YLUDOYHFWRUVKDYHEHFRPHDWWUDFWLYHWRROVIRUWKH
LQWURGXFWLRQ RI JHQHV LQWR KXPDQ FHOOV LQ JHQH WKHUDS\ VWXGLHV 7KHLU GUDZEDFNV DUH WKH
ELRORJLFDO KD]DUGV DVVRFLDWHG ZLWK YLUXVHV DQG LQ VRPH FDVHV WKH LPPXQRJHQLFLU\ RI YLUDO
YHFWRUV $OWHUQDWLYH WKHUDSHXWLF JHQH GHOLYHU\ V\VWHPV XVH FDWLRQLF OLSLGV DV FDUULHUV RI WKH
H[RJHQRXV'1$

7UDQVIHFWLRQ

*HQH WUDQVIHU PHWKRGV E\ WUDQVIHFWLRQ FDQ EH FODVVLILHG LQWR WZR PDMRU FDWHJRULHV
ELRFKHPLFDODQGSK\VLFDO7KHELRFKHPLFDOPHWKRGVLQFOXGHFDOFLXPSKRVSKDWHSUHFLSLWDWLRQ
DQG OLSLGPHGLDWHG WUDQVIHFWLRQV DQG SK\VLFDO WUDQVIHFWLRQ LV DFKLHYHG E\ HOHFWURSRUDWLRQ
7KH FKRLFH RI PHWKRGGHSHQGV RQ WKH FHOO W\SH )RU H[DPSOH KDHPDWRSRLHWLFFHOO OLQHV DUH
PRUHHIILFLHQWO\WUDQVIHFWHGE\HOHFWURSRUDWLRQWKDQWKHELRFKHPLFDOEDVHGPHWKRGVZKHUHDV
VRPHFHOOW\SHVWDNHXS'1$HIILFLHQWO\ZKHQLWLVDVVRFLDWHGZLWKFDWLRQLFOLSLGVUDWKHUWKDQ
FDOFLXPSKRVSKDWHSUHFLSLWDWHV&RQYHUVHO\FDWLRQLFOLSLGVFDQEHKLJKO\WR[LFWRVRPHRWKHU
FHOOW\SHV

)ROORZLQJWUDQVIHFWLRQWKHH[RJHQRXV'1$UHPDLQVLQWKHQXFOHXVIRUDOLPLWHGWLPH
XQOHVVLWLV LQWHJUDWHG LQWR WKH KRVW JHQRPH +RZHYHU HYHQ LQ WKH QRQLQWHJUDWHGIRUP WKH
WUDQVIHFWHG '1$ LV VXEMHFW WR WKH UHJXODWRU\ PHFKDQLVPV WKDW FRQWURO JHQH H[SUHVVLRQ DQG
WKHUHIRUH LWV JHQHV FDQ EH H[SUHVVHG WUDQVLHQWO\ 7KLV WUDQVLHQW JHQH H[SUHVVLRQ KDV EHHQ
H[SORLWHG LQ VWXGLHV VXFK DV WKH DQDO\VLV RI UHJXODWRU\ VHTXHQFHV DQG RSWLPL]DWLRQ RI
WUDQVIHFWLRQFRQGLWLRQV,QWHJUDWLRQRIWKHWUDQVIHFWHGJHQHLQWRWKHKRVWJHQRPH&RQYHUVHO\
JLYHV ULVH WR VWDEOH UHWHQWLRQ RI WKH H[RJHQRXV JHQH LQ WKH FHOOV SURYLGLQJ FRQVWLWXWLYH
H[SUHVVLRQ


ϮϮϬ

 ,Q PRVW WUDQVIHFWLRQ H[SHULPHQWV WKH F'1$ RI WKH JHQH RI LQWHUHVW LV LQVHUWHG LQWR D
PDPPDOLDQ H[SUHVVLRQ YHFWRU WKDW FDUULHV DQ H[SUHVVLRQ FDVVHWWH FRQVLVWLQJ RI D VWURQJ
SURPRWHU VXFK DV WKH /75 SURPRWHU RI 5RXV VDUFRPD YLUXV IRU H[SUHVVLRQ RI WKH JHQH LQ
PDPPDOLDQFHOOV D PXOWLSOHFORQLQJ VLWH DQG D SRO\DGHQ\ODWLRQ VHTXHQFH7KHYHFWRUDOVR
FRQWDLQV D EDFWHULDO RULJLQ RI UHSOLFDWLRQ DQG D EDFWHULDO VHOHFWDEOH PDUNHU IRU SURSDJDWLRQ
DQGVHOHFWLRQRIWKHYHFWRULQEDFWHULDOFHOOV 7RLVRODWHWKHIHZWUDQVIHFWHGPDPPDOLDQFHOOV
IURPWKHPDMRULW\RIQRQWUDQVIHFWHGRQHVDGRPLQDQWPDPPDOLDQVHOHFWDEOHPDUNHULVDOVR
XWLOL]HG 7KLV PDUNHU PD\ EH RQ D GLIIHUHQW YHFWRU WKDW LV FRWUDQVIHFWHG LQWR WKHFHOOVDORQJ
ZLWKWKHYHFWRURU'1$VHTXHQFHWKDWFDUULHVWKHWDUJHWJHQH,QWKLVFDVHDOWKRXJKWKHFR
WUDQVIHFWHG'1$VDUHQRWSK\VLFDOO\OLQNHGDFRQVLGHUDEOHQXPEHURIWKHPLQWHJUDWHLQWRWKH
JHQRPHLQODUJHFRQFDWHPHULFVWUXFWXUHVWKDWFDQEHXSWRNE7KHUHIRUHLWLVEHOLHYHG
WKDW DW VRPH VWDJH DIWHU HQWHULQJ WKH FHOO FRWUDQVIHFWHG '1$ VHTXHQFHVDUH OLJDWHG WR HDFK
RWKHU EHIRUH LQWHJUDWLQJ LQWR WKH KRVW JHQRPH 7UDQVIHFWLRQ LV D SRZHUIXO WRRO IRU FORQLQJ
JHQHVWKDWJLYHULVHWRSKHQRW\SLFHIIHFWVLQWKHWUDQVIHFWHGFHOOV7KLVJHQHFORQLQJVWUDWHJ\
KRZHYHU UHTXLUHV WKH UHVFXH RI WKH H[RJHQRXV '1$ IURP WKH JHQRPHV RI WKH FHOOV WKDW
H[KLELW WKH SKHQRW\SLF HIIHFWV 6HYHUDO SURFHGXUHV KDYH EHHQ GHVFULEHG WR DFKLHYH WKLV EXW
WKH\ DUH RIWHQ FXPEHUVRPH DQG LQYROYH VHFRQG URXQGV RI WUDQVIHFWLRQV IROORZHG E\
FRQVWUXFWLRQ RI JHQRPLF OLEUDULHV IURP WKH VHFRQGDU\ WUDQVIHFWDQWV DQG VFUHHQLQJ RI WKLV
OLEUDU\IRUWKHFORQHGJHQH+HQFHRWKHUW\SHVRIYHFWRUVKDYHEHHQJHQHUDWHGWKDWXWLOL]HWKH
(SVWHLQ%DUU YLUXV (%9  RULJLQRI UHSOLFDWLRQ 7KH (%9 RULJLQ RI UHSOLFDWLRQ DOORZV WKHVH
YHFWRUVWRUHSOLFDWHLQKXPDQFHOOVGXULQJHDFKFHOOGLYLVLRQZKLOHPDLQWDLQHGLQDQHSLVRPDO
VWDWH LHQRQLQWHJUDWHG 7KHUHIRUHWKHVHYHFWRUVKDYHWZRDGYDQWDJHV)LUVWWKH\JLYHULVH
WR JUHDWHUWUDQVIHFWLRQ HIILFLHQFLHV EHFDXVH WKH\ GR QRW QHHG WRLQWHJUDWH WREH PDLQWDLQHG
DQG VHFRQGO\ IROORZLQJ WUDQVIHFWLRQ WKH\ FDQ EH VKXWWOHG EDFN LQWR DQ ( FROL KRVW WKXV
PDNLQJ WKHLU VXEVHTXHQW LVRODWLRQ HDVLHU 7KH (%9EDVHG VKXWWOH YHFWRUV ZHUH VXFFHVVIXOO\
XVHGLQFORQLQJWKHKXPDQF'1$VIRU)DQFRQL VDQDHPLDFRPSOHPHQWDWLRQJURXS& )$&& 
DQG[HURGHUPDSLJPHQWRVXPJURXS& ;3&& JHQHV

&DOFLXPSKRVSKDWH'1$FRSUHFLSLWDWLRQ

7KH PHWKRG RI FDOFLXP SKRVSKDWH'1$ FRSUHFLSLWDWLRQ LV WKH PRVW ZLGHO\ XVHG
WHFKQLTXH IRU WKH WUDQVIHFWLRQ RI PDPPDOLDQ FHOOV 7KLV WHFKQLTXH ZDV ILUVW LQWURGXFHG E\
*UDKDP DQG 9DQ GHU (E LQ  6LQFH WKHQ WKHUH KDYH EHHQ PDQ\ PRGLILFDWLRQV DQG
RSWLPL]DWLRQ SURWRFROV IRU REWDLQLQJ KLJKHU WUDQVIHFWLRQ IUHTXHQFLHV IRU ERWK VWDEOH DQG
WUDQVLHQWH[SUHVVLRQVRIH[RJHQRXVJHQHV7KHSULQFLSOHRIWKLVWHFKQLTXHLVWKHIRUPDWLRQRI
LQVROXEOHFDOFLXP SKRVSKDWH'1$FRPSOH[HV LQ D VXSHUVDWXUDWHGVROXWLRQ7KLVLVDFKLHYHG
E\ DGGLQJ D VROXWLRQ FRQWDLQLQJ '1$ DQG &D&O WR D EXIIHUHG VDOLQH VROXWLRQ FRQWDLQLQJ
SKRVSKDWHDQGLQFXEDWLQJWKHPL[WXUHIRUDSHULRGRIWLPHWRDOORZWKHIRUPDWLRQRIFDOFLXP
SKRVSKDWH'1$FRSUHFLSLWDWHV7KHPL[WXUHLVDGGHGWRFXOWXUHFHOOVLQPHGLXPIROORZHGE\
LQFXEDWLRQ DW ƒ& IRU D SHULRG XVXDOO\ EHWZHHQ  KRXUV GHSHQGLQJ RQ WKH FHOO W\SH
'1$ PROHFXOHV HQWHU WKH FHOOV E\ HQGRF\WRVLV RI WKH FDOFLXP SKRVSKDWH'1$ FR
SUHFLSLWDWHV 6HYHUDO RI WKH IDFWRUV WKDW LQIOXHQFH WKH HIILFDF\ RI WKLV PHWKRG DUH GHVFULEHG
EHORZ

'1$

7KHFRQFHQWUDWLRQ WRSRORJ\ DQG TXDOLW\ RI'1$DIIHFWWKHWUDQVIHFWLRQHIILFLHQF\,W
KDVEHHQVKRZQWKDWVXERSWLPDOFRQFHQWUDWLRQVRI'1$GUDVWLFDOO\UHGXFHWKHHIILFLHQF\RI
FDOFLXP SKRVSKDWH WUDQVIHFWLRQ ,Q DJUHHPHQW ZLWK WKLV VWXGLHV RQ WKH NLQHWLFV RI WKH
IRUPDWLRQRIFDOFLXPSKRVSKDWH'1$FRPSOH[LQGLFDWHWKDWKLJK'1$FRQFHQWUDWLRQVLQKLELW

ϮϮϭ

WKLVSURFHVVDQGOHDGWRUHGXFWLRQRI'1$DVVRFLDWHGZLWKWKHLQVROXEOHFRPSOH[0RUHRYHU
&KHQ DQG 2ND\DPD KDYH UHSRUWHG WKDW VXSHUFRLOHG SODVPLG '1$ JLYHV ULVH WR VHYHUDOIROG
KLJKHUQXPEHUVRIVWDEOHWUDQVIRUPDQWVWKDQOLQHDUL]HG'1$

S+

2SWLPXP S+ UDQJH IRU WKH IRUPDWLRQ RI FDOFLXP SKRVSKDWH SUHFLSLWDWHV IRU PRVW FHOO
OLQHV LV  WR  ,W KDV EHHQ VXJJHVWHG WKDW WKH &2 OHYHO LQ WKH LQFXEDWRU GXULQJ
WUDQVIHFWLRQDOVRLQIOXHQFHVWKHWUDQVIHFWLRQIUHTXHQF\

6WDQGLQJDQGLQFXEDWLRQWLPHV

6WDQGLQJWLPHJUHDWO\DIIHFWVWKHTXDOLW\RISUHFLSLWDWHVIRUWUDQVIHFWLRQV7KHORQJHUWKH
FDOFLXP SKRVSKDWH'1$ PL[WXUH LV LQFXEDWHG EHIRUH DGGLWLRQ WR WKH FHOOV WKH FRDUVHU WKH
SUHFLSLWDWHVZLOOEHFRPHDQGDVWKHUHLVDQRSWLPDOVL]HRIWKHSUHFLSLWDWHVWREHWDNHQXSE\
FHOOVILQHWXQLQJLVQHHGHGWRREWDLQWKHEHVWVWDQGLQJWLPH,WDSSHDUVWKDWWKHVROXELOLW\RI
FDOFLXPSKRVSKDWHLVUHGXFHGE\LQFUHDVLQJWKHWHPSHUDWXUHKRZHYHUPRVWSURWRFROVVXJJHVW
URRP WHPSHUDWXUH DQG YDU\LQJ VWDQGLQJ WLPHV RI  PLQXWHV ,QFXEDWLRQ WLPH IRU
WUDQVIHFWLRQYDULHVEHWZHHQDIHZKRXUVXSWRKRXUVGHSHQGLQJRQWKHFHOOW\SH

*HQHWUDQVIHU
/LSLGPHGLDWHGJHQHWUDQVIHU OLSRIHFWLRQ 

7KH XVH RI FDWLRQLF OLSLGV IRU '1$ WUDQVIHFWLRQ LQWR PDPPDOLDQ FHOOV KDV EHFRPH
ZLGHVSUHDGEHFDXVHVHYHUDOIHDWXUHVRIWKHVHUHDJHQWVPDNHWKHPDWWUDFWLYHYHKLFOHVIRUJHQH
GHOLYHU\SDUWLFXODUO\LQJHQHWKHUDS\)RULQVWDQFHWKH\DUHVDIHUWKDQYLUDOYHFWRUVFDQEH
SURGXFHGLQODUJHTXDQWLWLHVDQGFDQGHOLYHUODUJH'1$IUDJPHQWVRIXSWRVHYHUDOPHJDEDVH
SDLUVORQJLQWRFHOOV

7KHUH DUH PDQ\ IRUPXODWLRQV RI OLSLG UHDJHQWV IRU WUDQVIHFWLRQ EXW WKH\ QRUPDOO\
FRQWDLQ D SRVLWLYHO\ FKDUJHG PRLHW\ DWWDFKHG WR D QHXWUDO OLSLG FRPSRQHQW 7KH ILUVW
JHQHUDWLRQRIOLSLGUHDJHQWVIRUWUDQVIHFWLRQFRQWDLQHGQHXWUDOOLSLGVWKDWUHOLHGRQPHWKRGVIRU
FDSWXULQJ'1$PROHFXOHVZLWKLQWKHOLSRVRPHVEXWWRGD\ VFDWLRQLF OLSLGVIRUPOLSLG'1$
FRPSOH[HV WKDW PDNH WKH WUDQVIHFWLRQ HIILFLHQF\ LQGHSHQGHQW RI HQFDSVXODWLRQ RI '1$ 2Q
PL[LQJ RI WKHVH UHDJHQWV ZLWK '1$ WKH FKDUJHG KHDG JURXSV DUH GUDZQ WRZDUGV WKH
SKRVSKDWHEDFNERQHRI'1$DQGIRUPOLSLG'1$FRPSOH[HV:KHQWKHVXVSHQVLRQRIWKHVH
FRPSOH[HVLVDGGHGWRWKHFHOOVWKHSRVLWLYHO\FKDUJHGKHDGJURXSVRIWKHOLSLGDUHDWWUDFWHG
WR WKH QHJDWLYHO\ FKDUJHG FHOO PHPEUDQH 7KH HQG UHVXOW LV WKDW WKH OLSLG'1$ FRPSOH[ LV
HLWKHUIXVHGWRWKHFHOOPHPEUDQHRUHQWHUVWKHFHOOE\HQGRF\WRVLVWUDQVIHUULQJLWV'1$ORDG
LQWRWKHFHOO,WLVGXHWRWKHVHSURSHUWLHVRIWKHFDWLRQLFOLSRVRPHVWKDWHIILFLHQW'1$GHOLYHU\
KDVEHHQDFKLHYHGLQPDQ\FHOOOLQHV

9DULRXVOLSRVRPHIRUPXODWLRQVDUHFRPPHUFLDOO\DYDLODEOHEXWLWLVLPSRUWDQWWREHDULQ
PLQG WKDW WKH WUDQVIHFWLRQ HIILFLHQF\ GHSHQGV YHU\ PXFK RQ WKH FHOO W\SH DQG WKH FKHPLFDO
DQGSK\VLFDOVWUXFWXUHRIWKHFDWLRQLFOLSRVRPHVSDUWLFXODUO\ZLWKUHVSHFWWRWKHOLSRVRPHVL]H
DQGFDWLRQLFKHDGJURXS7KXVSUHSDUDWLRQVPXVWEHFRPSDUHGWRLGHQWLI\WKHIRUPXODWLRQWKDW
JLYHVWKHEHVWWUDQVIHFWLRQHIILFLHQF\IRUWKHFHOOOLQHRILQWHUHVW2WKHUVLJQLILFDQWIDFWRUVLQ
XVLQJ WKHVH UHDJHQWV IRU '1$ WUDQVIHFWLRQ DUH OLSLG'1$ UDWLR WKHLU FRQFHQWUDWLRQV '1$
TXDOLW\FHOOFXOWXUHGHQVLW\DQGWKHGXUDWLRQRIH[SRVXUHRIFHOOVWRWKHOLSLG
9LUDOPHGLDWHGJHQHWUDQVIHU

ϮϮϮ

  +XPDQ LPPXQRGHILFLHQF\ YLUXVHV +,9  DUH WKH PRVW UHFHQWO\ GLVFRYHUHG
PHPEHUVRIWKHUHWURYLUXVIDPLO\ DQGKDYHOHGWRWKHQHZFODVVLILFDWLRQRI OHQWLYLUXV /LNH
RWKHUPHPEHUVRIWKHUHWURYLUDOIDPLO\WKH+,9JHQRPHFRQWDLQVWKHJDJSRODQGHQYJHQHV
,Q DGGLWLRQ VHYHUDO RWKHU QRQVWUXFWXUDO SURWHLQV ZKLFK VHUYH UHJXODWRU\ IXQFWLRQV DUH
FRQWDLQHGZLWKLQLWVJHQRPH%HORZLVWKHGLDJUDPRIWKH+,9JHQRPHFRQVLGHUHGWREHRQH
RI WKHPRVWFRPSOH[ DPRQJ WKH UHWURYLUXVHV 1RWLFH WKDW WKH EDVLF JHQRPH XQLWV JDJ SRO
DQGHQY DQG/75VSUHGRPLQDWHWKHJHQRPH


 
3RWHQWLDODSSOLFDWLRQV5DWKHUWKDQDQLQGHSWKIRFXVRQ+,9ELRORJ\ZHZLOOGLVFXVV
WKH FXUUHQW DSSOLFDWLRQV RI WKH +,9 YLUXV LQ JHQH WKHUDS\ +,9EDVHG YHFWRUV DUH UHFHQW
GHYHORSPHQWV LQ WKH ILHOG RI JHQH WKHUDS\ DQG IRFXV RQ WUHDWPHQW RI $,'6 9HFWRU
SURGXFWLRQ LV VLPLODU WR WKDW RI 00/9 YHFWRUV DQG +,9 YHFWRUV SRVVHVV DOO WKH VDPH
DGYDQWDJHVDQGGLVDGYDQWDJHVDVWKHLU00/9FRXQWHUSDUWV$QH[FLWLQJDSSOLFDWLRQRI+,9
YHFWRUVLVWRXVH+,9YHFWRUVWRWDUJHWJHQHVVHOHFWLYHO\LQWR+,9FRQWDLQLQJFHOOV7KHJRDO
LVWKDWJHQHVGHOLYHUHGE\WKH+,9YHFWRUZRXOGDOORZVHOHFWLYHNLOOLQJRIDQ\FHOOSUHYLRXVO\
RUVXEVHTXHQWO\LQIHFWHGZLWK+,9$QH[DPSOHRIKRZWKLVPLJKWEHDFFRPSOLVKHGIRFXVHV
RQWKHWDWDQGUHYJHQHVIRXQGLQWKH+,9JHQRPH7KHVHJHQHVDUHDOVRIRXQGRQO\LQFHOOV
LQIHFWHG ZLWK +,9 %\ XVLQJ D WDW DQG UHY LQGXFHG SURPRWHU WR GULYH WKH H[SUHVVLRQ RI D
WR[LQJHQHDQ\FHOOLQIHFWHGZLWK +,9VKRXOGEHVHOHFWLYHO\NLOOHG XSRQ H[SUHVVLRQ RI WKH
WR[LQJHQH2IFRXUVHWKLVV\VWHPGRHVUHTXLUHWKDWDFHOOEHFRPHLQIHFWHGZLWK+,9EXWRQFH
LQIHFWHG WKH FHOO ZRXOG WHUPLQDWH DV ZRXOG WKH +,9 YLUXV $ PDMRU FRQFHUQ LQ XVLQJ +,9
YHFWRUV LV WKH IDFW WKDW WKHUH LV D VWURQJ SRVVLELOLW\ IRU JHQHWLF UHFRPELQDWLRQ EHWZHHQ
LQIHFWLRXV +,9 DQG WKH +,9 YHFWRU LWVHOI 6XFK DQ HYHQW ZRXOG UHVXOW LQ WKH +,9 YHFWRU
DFWLQJDVDQLQIHFWLRXV+,9SDUWLFOH2QHSRVVLEOHPHWKRGWRRYHUFRPHWKLVULVNZRXOGEHWKH
LQFOXVLRQRIDVXLFLGHJHQHLQWRWKH+,9YHFWRUJHQRPH7KHVXLFLGHJHQHZRXOGPDNHFHOOV
LQIHFWHGZLWKWKH+,9YHFWRUJHQRPHVHQVLWLYHWRDGUXJWKDWZRXOGSRLVRQRQO\WKRVHFHOOV
FRQWDLQLQJ WKH +,9 YHFWRU JHQRPH $Q H[DPSOH RI D VXLFLGH JHQH LV WKH +HUSHV VLPSOH[
YLUXV WK\PLGLQH NLQDVH JHQH DQG JDQFLFORYLU LV WKH GUXJ ZKLFK ZRXOG \LHOG VHOHFWLYH
WR[LFLW\
 




ϮϮϱ

 7DEOH$GYDQWDJHVDQGGLVDGYDQWDJHVRIUHWURYLUDOYHFWRUV
$GYDQWDJHV 'LVDGYDQWDJHV
+LJK7UDQVGXFWLRQ(IIFLHQF\ 5HTXLUHVGLYLGLQJFHOOVIRULQIHFWLYLW\
,QVHUW6L]HXSWRN% /RZ7LWHUV  
,QWHJUDWHVLQWRKRVWJHQRPHUHVXOWLQJLQ
VXVWDLQHGH[SUHVVLRQRIYHFWRU ,QWHJUDWLRQLVUDQGRP
,Q YLYR GHOLYHU\ UHPDLQV SRRU (IIHFWLYH RQO\
([WUHPHO\ZHOOVWXGLHGV\VWHP ZKHQLQIHFWLQJKHOSHUFHOOOLQHV
9HFWRUSURWLHQVQRWH[SUHVVHGLQKRVW 

E$GHQRYLUDO9HFWRUV

$GHQRYLUXVHVZHUHGLVFRYHUHGLQDVLQYHVWLJDWRUVKXUULHGO\DWWHPSWHGWRLGHQWLI\
WKH FDXVDWLYH DJHQWV RI WKH FRPPRQ FROG 7KHUH DUH FXUUHQWO\  GLVWLQFW VHURW\SHV DQG DV
PDQ\ DV  GLIIHUHQW SDUWLFXODU YDULHWLHV RI DGHQRYLUXV DOO RI ZKLFK JHQHUDOO\ LQIHFW WKH
RFXODU UHVSLUDWRU\ RU *, HSLWKHOLXP ,Q  )UDQN *UDKDP GHYHORSHG D FHOO OLQH ZKLFK
HQDEOHGWKHILUVWSURGXFWLRQRIUHFRPELQDQWDGHQRYLUXVHVLQDKHOSHUIUHHHQYLURQPHQW6LQFH
WKLV WLPH DGHQRYLUDO YHFWRUV KDYH UHFHYLHG PXFK DWWHQWLRQ DV JHQH WUDQVIHU DJHQWV DQG
FXUUHQWO\RIIHUDZLGHYDULHW\RIJHQHWKHUDS\DSSOLFDWLRQV 

%DVLFVWUXFWXUHRIWKHDGHQRYLUXVYLULRQ$GHQRYLUDOYLULRQVDUHLFRVDKHGUDOLQVKDSH
 WR  QP LQ GLDPHWHU DQG DUH QRW HQYHORSHG 7KH YLUDO FDSVLG FRQWDLQV  SURWHLQ
FRPSRQHQWVWKHPDMRULW\RIZKLFKDUHWKUHHSURWHLQVILEHUSHQWRQEDVHGDQGKH[RQ)LEHU
DQGSHQWRQEDVHSURWHLQV DUHLPSRUWDQWLQUHFHSWRUELQGLQJDQGFHOOLQWHUQDOL]DWLRQZKHUHDV
KH[RQFRPSULVHVWKHPDMRULW\RIWKHYLUDOFDSVLG7KHYLUDOJHQRPHLVODUJHFRQVLVWLQJRID
VLQJOHGRXEOHVWUDQGHG'1$PROHFXOHWRNLOREDVHVLQVL]H9LUDO'1$UHSOLFDWLRQDQG
WUDQVFULSWLRQ DUH FRPSOH[ DQG YLUDO UHSOLFDWLRQ DQG DVVHPEO\ RFFXU RQO\ LQ WKH QXFOHXV RI
LQIHFWHGFHOOV0DWXUHYLULRQVDUHUHOHDVHGE\FHOOXODUGLVLQWHJUDWLRQ

$GHQRYLUDOLQIHFWLRQLVDKLJKO\FRPSOH[SURFHVV,WLVLQLWLDWHGE\WKHYLUXVELQGLQJWR
WKH FHOOXODU UHFHSWRU ,QWHUQDOL]DWLRQ RFFXUV YLD UHFHSWRUPHGLDWHG HQGRF\WRVLV IROORZHG E\
UHOHDVHIURPWKHHQGRVRPH$IWHUHQGRVRPDOUHOHDVHWKHYLUDOFDSVLGXQGHUJRHVGLVDVVHPEO\
DVLWMRXUQH\VWRWKHQXFOHDUSRUH1XFOHDUHQWU\RIWKHYLUDO'1$LVFRPSOHWHGXSRQFDSVLG
GLVVRFLDWLRQ DQG WKH YLUDO '1$ GRHV QRW LQWHJUDWH LQWR WKH KRVW JHQRPH EXW UHPDLQV LQ DQ
HSLVRPDOVWDWH 

5HSOLFDWLRQ GHILFLHQW DGHQRYLUXVHV $V DGHQRYLUDO UHSOLFDWLRQ GHSHQGV RQ WKH ($
UHJLRQRIWKHYLUDOJHQRPHDOOUHFRPELQDQWDGHQRYLUDOYHFWRUVKDYHWKLVUHJLRQRILWVJHQRPH
GHOHWHGDQGDUHUHIHUUHGWRDVUHSOLFDWLRQGHILFLHQW6XFKYHFWRUVDUHFDSDEOHRILQIHFWLQJD
FHOORQO\RQFHQRYLUDOSURSDJDWLRQRFFXUVDQGWKHLQIHFWHGFHOOGRHVQRWGLHDVDUHVXOWRI
YHFWRULQIHFWLRQ 

$GHQRYLUDO YHFWRU SURGXFWLRQ 5HFRPELQDQW DGHQRYLUDO YHFWRUV DUH SUHSDUHG IURP

WZRFRPSRQHQWVYLUDO'1$YHFWRUDQGDSDFNDJLQJFHOOOLQH7KHDGHQRYLUDO'1$YHFWRULVD
SODVPLG'1$WKDWFRQWDLQVDSRUWLRQRIWKHYLUDOJHQRPH,WKDVKDGWKH($UHJLRQGHOHWHG
DQG GHVLUHG JHQHV DUHFORQHG LQWR D PXOWLFORQLQJ VLWHWKDW KDV EHHQ LQVHUWHG LQ SODFH RI WKH
($ UHJLRQRIWKHJHQRPH8QIRUWXQDWHO\WKHODUJHVL]HRIWKHDGHQRYLUDO JHQRPH SHUYHQWV
WKHXVHRIDVLQJOHSODVPLGEDVHGV\VWHPLQYHFWRUSURGXFWLRQ,QVWHDGWKHDGHQRYLUDOYHFWRU
LVSURGXFHGXVLQJHLWKHULQYLWUROLJDWLRQRUKRPRORJXVUHFRPELQDWLRQ8VLQJLQYLWUROLJDWLRQ

ϮϮϲ

 ,QIHFWVERWKUHSOLFDWLQJDQGGLIIHUHQWLDWHG
FHOOV 


F/HQWLYLUXVHV

/HQWLYLUXVHVDUHDVXEFODVVRI5HWURYLUXVHV7KH\KDYHUHFHQWO\EHHQDGDSWHGDVJHQH
GHOLYHU\ YHKLFOHV YHFWRUV  WKDQNV WR WKHLU DELOLW\ WR LQWHJUDWH LQWR WKH JHQRPH RI QRQ
GLYLGLQJFHOOVZKLFKLVWKHXQLTXHIHDWXUHRI/HQWLYLUXVHVDVRWKHU5HWURYLUXVHVFDQLQIHFW
RQO\GLYLGLQJFHOOV7KHYLUDOJHQRPHLQWKHIRUPRI51$LVUHYHUVHWUDQVFULEHGZKHQWKH
YLUXVHQWHUVWKHFHOOWRSURGXFH'1$ZKLFKLVWKHQLQVHUWHGLQWRWKHJHQRPHDWDUDQGRP
SRVLWLRQE\WKHYLUDOLQWHJUDVH HQ]\PH 7KH YHFWRU QRZFDOOHG DSURYLUXV UHPDLQVLQWKH
JHQRPHDQGLVSDVVHGRQWRWKHSURJHQ\RIWKHFHOOZKHQLWGLYLGHV7KHVLWHRILQWHJUDWLRQ
LV XQSUHGLFWDEOH ZKLFK FDQ SRVH D SUREOHP 7KH SURYLUXV FDQ GLVWXUE WKH IXQFWLRQ RI
FHOOXODU JHQHV DQGOHDG WR DFWLYDWLRQ RI RQFRJHQHV SURPRWLQJ WKH GHYHORSPHQW RI FDQFHU
ZKLFKUDLVHVFRQFHUQVIRUSRVVLEOHDSSOLFDWLRQVRI OHQWLYLUXVHVLQJHQH WKHUDS\ +RZHYHU
VWXGLHVKDYHVKRZQWKDWOHQWLYLUXVYHFWRUVKDYHDORZHUWHQGHQF\WRLQWHJUDWHLQSODFHVWKDW
SRWHQWLDOO\FDXVHFDQFHUWKDQJDPPDUHWURYLUDOYHFWRUV0RUHVSHFLILFDOO\RQHVWXG\IRXQG
WKDWOHQWLYLUDOYHFWRUVGLGQRWFDXVHHLWKHUDQLQFUHDVHLQWXPRULQFLGHQFHRUDQHDUOLHURQVHW
RI WXPRUV LQ D PRXVH VWUDLQ ZLWK D PXFK KLJKHU LQFLGHQFH RI WXPRUV 0RUHRYHU FOLQLFDO
WULDOV WKDW XWLOL]HG OHQWLYLUDO YHFWRUV WR GHOLYHU JHQH WKHUDS\ IRU WKH WUHDWPHQW RI +,9
H[SHULHQFHGQRLQFUHDVHLQPXWDJHQLFRURQFRORJLFHYHQWV

)RU VDIHW\ UHDVRQV OHQWLYLUDO YHFWRUV QHYHU FDUU\ WKH JHQHV UHTXLUHG IRU WKHLU
UHSOLFDWLRQ 7R SURGXFH D OHQWLYLUXV VHYHUDO SODVPLGV DUH WUDQVIHFWHG LQWR D VRFDOOHG
SDFNDJLQJFHOOOLQHFRPPRQO\+(.2QHRUPRUHSODVPLGVJHQHUDOO\UHIHUUHGWRDV
SDFNDJLQJ SODVPLGV HQFRGH WKH YLULRQ SURWHLQV VXFK DV WKH FDSVLG DQG WKH UHYHUVH
WUDQVFULSWDVH$QRWKHUSODVPLGFRQWDLQVWKHJHQHWLFPDWHULDOWREHGHOLYHUHGE\WKHYHFWRU
,W LV WUDQVFULEHG WR SURGXFH WKH VLQJOHVWUDQGHG 51$ YLUDO JHQRPH DQG LV PDUNHG E\ WKH
SUHVHQFH RI WKH ȥ SVL  VHTXHQFH 7KLV VHTXHQFH LV XVHG WR SDFNDJH WKH JHQRPH LQWR WKH
YLULRQ

/HQWLYLUXVHVKDYHWKHXQLTXHDELOLW\DPRQJVWUHWURYLUXVHVRIEHLQJDEOHWRLQIHFWQRQ
F\FOLQJ FHOOV 9HFWRUV GHULYHG IURP OHQWLYLUXVHV KDYH SURYLGHG D KXJH DGYDQFHPHQW LQ
WHFKQRORJ\DQGVHHPLQJO\RIIHUWKHPHDQVWRDFKLHYHVLJQLILFDQWOHYHOVRIJHQHWUDQVIHULQ
YLYR$VWKHSDUWLFOHVDUH RIWHQ SVHXGRW\SHGZLWK WKH HQYHORSH RI WKHYHVLFXODUVWRPDWLWLV
YLUXV 969 WKHYHFWRUFDQVHUYHWRLQWURGXFHJHQHVLQWRDEURDGUDQJHRIWLVVXHVDQGFDQ
EHXVHGLQYLYR)XUWKHUPRUHLWKDVEHHQGHPRQVWUDWHGWKDWLQYLYRH[SUHVVLRQLVVXVWDLQHG
IRUVHYHUDOPRQWKVZLWKRXWGHWHFWDEOHSDWKRORJ\,QWKHRULJLQDOOHQWLYLUXVYHFWRUVGHVFULEHG
E\ 1DOGLQL HW DO 1DOGLQL HW DO D  1DOGLQL HW DO E   WKH YHFWRU S&09ǻ5
VXSSOLHVDOOEXWWKH+,9HQYHORSHLQWUDQVWKHYHFWRUS0'*LVXVHGWRSURGXFHWKH969
*SVHXGRW\SHZKLOHWKHWUDQVJHQH ODF= LVLQVHUWHGLQWRWKHSODVPLGS+5¶ZKLFKXVHVD
OHQWLYLUDO /75 D VSOLFH GRQRU DQG JDJ VSOLFH GRQRU DQG DFFHSWRU DVVRFLDWHG ZLWK D UHY
UHVSRQVLYH HOHPHQW 7KHVH WKUHH SODVPLGV DUH XVHG WR WUDQVGXFH 7 FHOOV DQG WKH
VXSHUQDWDQWDVVD\HGIRUSJDJDFWLYLW\

)URPWKHVHRULJLQDOH[SHULPHQWVQHZSODVPLGVKDYHEHHQGHYLVHGZKLFKKDYHPRUH
YHUVDWLOH IHDWXUHV 7KHVH LQFOXGH VXFK SODVPLGV DV S/HQWL9'(67ΠS/HQWL9
'(67ΠS/HQWL8E&9'(67Π,QYLWURJHQ /LIH 7HFKQRORJLHV ,QF  ZKLFK XWLOL]H
*DWHZD\7HFKQRORJ\Π,QYLWURJHQ/LIH7HFKQRORJLHV,QF LQZKLFKUHFRPELQDWLRQRFFXUV

ϮϮϴ

WKURXJKWKHDWW5DQGDWW5DQGWKXVDOORZVIRUUDSLGFORQLQJ/HQWLYLUDOV\VWHPVIRUJHQH
GHOLYHU\DUHJHQHUDOO\GHULYHGIURPWKHKXPDQLPPXQRGHILFLHQF\YLUXV7KH9'/XWLOL]HV
D YHFWRU FRQVWUXFW WKDW HPSOR\V D QRQKRPRORJRXV YLUDO HQYHORSH GHULYHG IURP WKH
YHVLFXODUVWRPDWLWLVYLUXV SRVVHVVRQO\WKUHH+,9JHQHVDQGVHSDUDWHVWKHJHQHVHQFRGLQJ
WKHFRPSRQHQWVQHFHVVDU\IRUYLUDOSDFNDJLQJRQWRIRXUGLIIHUHQWSODVPLGV7KHVHIHDWXUHV
LQ FRQMXQFWLRQ ZLWK VHYHUDO RWKHU ELRVDIHW\ HQKDQFHPHQWV SUHYHQW UHFRPELQDWLRQ RI
UHSOLFDWLRQFRPSHWHQW+,9

$OO OHQWLYLUXV YHFWRUV SURGXFHG LQ WKH 9'/ DUH SURGXFHG LQ FRPSOLDQFH ZLWK */3
VWDQGDUGV7KHSURGXFWLRQRIDOHQWLYLUXVYLUXVEHJLQVZLWKFORQLQJWKHJHQHRILQWHUHVW JRL 
LQWR DQ HQWU\ SODVPLG RI WKH *DWHZD\ 7HFKQRORJ\Π,QYLWURJHQ  7KH HQWU\ SODVPLG
FRQWDLQLQJ\RXUJHQHRILQWHUHVWLVWKHQUHFRPELQHGZLWKRQHRIWKH9LUD3RZHUŒ/HQWLYLUDO
([SUHVVLRQSODVPLGVXVLQJ*DWHZD\7HFKQRORJ\Π,QYLWURJHQ 7KH9LUD3RZHUSODVPLGV
ZKLFKODFNVWKHJDJSROHQYHORSHJHQHVDQGRWKHUDFFHVVRU\JHQHV7KHH[SUHVVLRQSODVPLG
LV FRWUDQVIHFWHG LQWR )7 FHOOV ZLWK WKUHH VXSHUFRLOHG SDFNDJLQJ SODVPLGV
S/3 JDJSRO  S/3 UHY  DQG S/3969* 969* HQYHORSH  ZKLFK VXSSO\ KHOSHU
IXQFWLRQV DQG YLUDO SURWHLQV LQ WUDQV $W  KRXUV SRVWWUDQVIHFWLRQ WKH VXSHUQDQW
FRQWDLQLQJWKHYLUDOSDUWLFOHV LVKDUYHVWHGDQGFODULILHG$WWKLVSRLQWOHQWLYLUDOYHFWRUVFDQ
EHXVHGWRWUDQVGXFHWKHPDPPDOLDQFHOOOLQHRIFKRLFH



(OHFWURSRUDWLRQ

(OHFWURSRUDWLRQLQYROYHVH[SRVXUHRIFHOOVLQVXVSHQVLRQWRDSXOVHGHOHFWULFILHOGWKDW
FDXVHV WUDQVLHQW IRUPDWLRQ RI SRUHV LQ WKH FHOO PHPEUDQH DOORZLQJ H[FKDQJH RI
PDFURPROHFXOHV EHWZHHQ WKH H[WUDFHOOXODU HQYLURQPHQW DQG WKH F\WRSODVP 5HPRYDO RI WKH
HOHFWULFILHOGUHVXOWVLQVSRQWDQHRXVVHDOLQJRIWKHSRUHVVLQFHWKHILHOGVWUHQJWKDQGGXUDWLRQ
RIWKHSXOVHDUHZLWKLQWKHWROHUDEOHUDQJHIRUWKHFHOOV3DUDPHWHUVWKDWDIIHFWWKHWUDQVIHFWLRQ
HIILFLHQF\RIHOHFWURSRUDWLRQDUHGLVFXVVHGEHORZ

9ROWDJH

2QHRIWKHPRVWLPSRUWDQWIDFWRUVDIIHFWLQJWUDQVIHFWLRQHIILFLHQF\E\HOHFWURSRUDWLRQLV
WKH HOHFWULF ILHOG VWUHQJWK DFURVV WKH FHOO ZKLFK DW D FULWLFDO SRLQW OHDGV WR WKH ORFDOL]HG
EUHDNGRZQRIWKHFHOOPHPEUDQHDQGIRUPDWLRQRISRUHV7KHILHOGVWUHQJWKLVGHVFULEHGE\


ZKHUH(LVWKHILHOGVWUHQJWK9LVWKHYROWDJHDQGGLVWKHGLVWDQFHEHWZHHQHOHFWURGHVWKHUH
LVDGLUHFWFRUUHODWLRQEHWZHHQWKHILHOGVWUHQJWKDQGYROWDJH0RUHRYHUWKHILHOGVWUHQJWKLV
DOVRSURSRUWLRQDOWRWKHSURGXFWRIWKHFDSDFLWRUYROWDJHDQGWKHFHOOGLDPHWHU7KHUHIRUHWKH
RSWLPXP YROWDJH IRU GLIIHUHQW FHOO W\SHV YDULHV DQG KDV WR EH GHWHUPLQHG HPSLULFDOO\
*HQHUDOO\HIILFLHQWLQWURGXFWLRQRI'1$LQWRFHOOVRFFXUVDWILHOGVWUHQJWKVWKDWJLYHULVHWR
FHOOGHDWK,W LV QRWHZRUWK\WKDWDIWHUHOHFWURSRUDWLRQPDQ\FHOOVWKDWH[KLELWWU\SDQ
EOXHH[FOXVLRQDQGDGKHUHWRWKHSODWHGLHDQGGHWDFK ZLWKLQKRXUVSRVWWUDQVIHFWLRQDQG
WKHUHIRUHFRXQWLQJWKHFHOOVE\WU\SDQEOXHH[FOXVLRQPD\SURYLGHDQLQDFFXUDWHPHDVXUHRI
WKHQXPEHURIYLDEOHFHOOV


7LPHFRQVWDQW

ϮϮϵ


0RVWHOHFWURSRUDWLRQVDUHSHUIRUPHGXVLQJH[SRQHQWLDOGHFD\ZDYHVWKDWDUHJHQHUDWHG
E\DQLQVWDQWVXUJHRIYROWDJHIROORZHGE\LWVH[SRQHQWLDOGHFOLQHRYHUDWLPHSHULRG7KLVLV
GHILQHG DV WLPH FRQVWDQW DQG LV D SURGXFW RI FDSDFLWDQFH DQG WKH HOHFWURSRUDWLRQ EXIIHU
UHVLVWDQFH 7LPH FRQVWDQW LV D XVHIXO SDUDPHWHU IRU HQVXULQJ UHSURGXFLELOLW\ RI WKH SXOVH
6RPHFRPPHUFLDOHOHFWURSRUDWLRQDSSDUDWXVHVLQGLFDWHWKHWLPHFRQVWDQWDIWHUHDFKSXOVHDQG
SURYLGH WKH RSSRUWXQLW\ WR FRPSDUH GLIIHUHQW SXOVHV DQG KHQFH UHSURGXFLELOLW\ RI WKH
HOHFWURSRUDWLRQ

7R PRGLI\ WKH WLPH FRQVWDQW WKH FDSDFLWDQFH RI WKH DSSDUDWXV DQGRU WKH EXIIHU
UHVLVWDQFHFDQEHDOWHUHG+LJKHULRQLFVWUHQJWKRIWKHEXIIHUDQGVKRUWHUGLVWDQFHEHWZHHQWKH
HOHFWURGHVUHVXOWLQORZHUUHVLVWDQFH7KHUHVLVWDQFHLVKRZHYHULQYHUVHO\SURSRUWLRQDOWRWKH
FURVVVHFWLRQDO DUHD RI WKH SDWK DQG WKHUHIRUH LW LV SRVVLEOH WR PDQLSXODWH WKH UHVLVWDQFH E\
FKDQJLQJWKHYROXPHRIWKHHOHFWURSRUDWLRQEXIIHUDVZHOO

%XIIHU

7KH FRPSRVLWLRQ RI WKH HOHFWURSRUDWLRQ EXIIHU GHWHUPLQHV LWV UHVLVWDQFH DQG KHQFH
LQIOXHQFHV WKH WLPH FRQVWDQW ,Q VRPH FDVHV JURZWK PHGLD KDYH DOVR EHHQ XVHG DV WKH
VXVSHQVLRQPHGLXP,WLVWKHUHIRUHHVVHQWLDOWRGHWHUPLQHWKHEHVWEXIIHUPHGLXPIRUHDFKFHOO
W\SHHPSLULFDOO\

7HPSHUDWXUH

7KHUH DUH GLIIHUHQW RSLQLRQV ZLWK UHJDUGV WR WKH FHOO VXVSHQVLRQ WHPSHUDWXUH EHIRUH
GXULQJDQGDIWHUWKHHOHFWULFSXOVH6RPHUHSRUWVLQGLFDWHKLJKHUWUDQVIHFWLRQIUHTXHQFLHV DW
URRPWHPSHUDWXUHZKHUHDVRWKHUVVXJJHVWLQFXEDWLRQRIFHOOVLQWKHSUHVHQFHRI'1$RQLFH
DWOHDVWWHQPLQXWHVEHIRUHDQGDIWHUDSSO\LQJWKHSXOVH

'1$

,QFUHDVLQJ '1$ FRQFHQWUDWLRQ UHVXOWV LQ KLJKHU WUDQVIHFWLRQ IUHTXHQF\ E\
HOHFWURSRUDWLRQ +LJK WUDQVIHFWLRQ HIILFLHQFLHV KDYH EHHQ UHSRUWHG ZLWK XS WR  XJPO RI
'1$&DUULHU QXFOHLFDFLGV KDYH DOVR EHHQXVHGWRLQFUHDVH WKHWUDQVIHFWLRQ HIILFLHQF\ EXW
WKHLU QDWXUH DSSHDUV WR SOD\ DQ LPSRUWDQW UROH )RU LQVWDQFH VDOPRQ VSHUP '1$ LQFUHDVHV
WUDQVIHFWLRQ HIILFLHQFLHV RI VRPH KXPDQ FHOO W\SHV ZKHUHDV \HDVW W51$ UHVXOWV LQ ORZHU
WUDQVIHFWLRQIUHTXHQFLHV

&HOOV

/LNHRWKHUWUDQVIHFWLRQPHWKRGVWKHW\SHRIFHOOVDQGWKHFHOOF\FOHSKDVHDWWKHWLPHRI
HOHFWURSRUDWLRQ DUH LPSRUWDQW IDFWRUV LQ GHWHUPLQLQJ WKH HIILFLHQF\ RI WUDQVIHFWLRQ E\
HOHFWURSRUDWLRQ ,Q PRVW FDVHV EHVW UHVXOWV DUH REWDLQHG ZLWK  [  WR  ;  FHOOVPO DW
H[SRQHQWLDOJURZWKSKDVH

6WDLQLQJRIFHOOVIRUH[SUHVVLRQRIȕJDODFWRVLGDVH
)DFWRUV WKDW LQIOXHQFH WKH HIILFLHQF\ RI D JHQH GHOLYHU\ V\VWHP KDYH WR EH WHVWHG
HPSLULFDOO\WRREWDLQWKHEHVWFRQGLWLRQVIRUDSDUWLFXODUFHOOOLQH)RUWKLVSXUSRVHXVHFDQEH
PDGH RI UHSRUWHU JHQHV LQFOXGLQJ WKH JHQHV WKDW FRGH IRU ȕJDODFWRVLGDVH OXFLIHUDVH DQG
FKORUDPSKHQLFRODFHW\OWUDQVIHUDVH &$7 7KHUHSRUWHUJHQHFDQEHWUDQVIHFWHGLQWRFHOOVDQG

ϮϯϬ

LWV H[SUHVVLRQ DQDO\VHG E\ D ELRFKHPLFDO DVVD\ DQGRU KLVWRFKHPLFDO VWDLQLQJ  KRXUV
SRVWWUDQVIHFWLRQ%HFDXVHWKHUHWHQGVWREHDFRUUHODWLRQEHWZHHQWUDQVLHQWH[SUHVVLRQRIWKH
UHSRUWHU JHQH DQG VWDEOH WUDQVIRUPDWLRQ RI FHOOV WKLV PHWKRG FDQ EH XVHG WR GHWHUPLQH WKH
RSWLPXPFRQGLWLRQVIRUERWKWUDQVLHQWDQGVWDEOHWUDQVIHFWLRQV

5HVFXHRIHSLVRPDOSODVPLGV

7KLV PHWKRG ZDV RULJLQDOO\ GHVFULEHG E\ +LOW IRU WKH LVRODWLRQ RI YLUDO '1$ IURP
PRXVH FHOOV 7KH HSLVRPDO (SVWHLQ%DUU YLUXV (%9  YHFWRUV VXFK DV WKH S5(3 VHULHV RI
H[SUHVVLRQYHFWRUV ,QYLWURJHQ FDQEHUHVFXHGIURPWUDQVIHFWHGFHOOVDQGXVHGWRWUDQVIRUP(
FROLFHOOVIRUWKHLUSURSDJDWLRQ

0LFURFHOOPHGLDWHGFKURPRVRPHWUDQVIHUV

&HOOFHOOIXVLRQRIVRPDWLFFHOOVLVDVLPSOHZD\RIWUDQVIHUULQJJHQHWLFPDWHULDOIURP
RQHFHOOWRDQRWKHUZKHUHDOOWKHFKURPRVRPHVRIWKHSDUWLFLSDWLQJFHOOVDUHHQJXOIHGZLWKLQD
VLQJOH FHOO PHPEUDQH $ PRUH UHILQHG PHWKRG RI WUDQVIHUULQJ JHQHWLF LQIRUPDWLRQ LV WKH
PHWKRGRIPLFURFHOOPHGLDWHGFKURPRVRPHWUDQVIHU 00&7 ZKHUHRQO\RQHFKURPRVRPH
RUDVPDOOJURXSRIFKURPRVRPHVLVWUDQVIHUUHGWRWKHUHFLSLHQWFHOO

7KH 00&7 WHFKQLTXH KDV EHHQ D SRZHUIXO WRRO LQ D YDULHW\ RI VWXGLHV LQYROYLQJ WKH
WUDQVIHU RI KXPDQ FKURPRVRPHV WR URGHQW FHOOV DQG WKH JHQHUDWLRQ RI PRQRFKURPRVRPDO
KXPDQURGHQW FHOO K\EULGV +RZHYHU EHFDXVH URGHQW FHOO K\EULGV ORVH WKH KXPDQ
FKURPRVRPHV DW KLJK IUHTXHQFLHV RQH RI WKH ILUVW FRQVLGHUDWLRQV LV WR KDYH WKH PHDQV IRU
VHOHFWLQJ WKH FHOOV WKDW KDYH UHFHLYHG DQG UHWDLQHG WKH GHVLUHG FKURPRVRPH 1DWXUDOO\
RFFXUULQJ PDUNHUV VXFK DV GLK\GURIRODWH UHGXFWDVH WK\PLGLQH NLQDVH DQG K\SR[DQWKLQH
JXDQLQHSKRVSKRULERV\OWUDQVIHUDVHRQFKURPRVRPHVDQG;UHVSHFWLYHO\FDQEHXVHG
WRLVRODWHKXPDQURGHQWK\EULGVWKDWFDUU\WKHVHFKURPRVRPHV+RZHYHUIRUWKHPDMRULW\RI
WKHKXPDQFKURPRVRPHVH[RJHQRXVPDUNHUVKDYHWREHXVHGWRWDJWKHFKURPRVRPHVEHIRUH
WKHLU WUDQVIHU LQWR WKH UHFLSLHQW URGHQW FHOOV 7KH WZR PRVW ZLGHO\ XVHG PDUNHUV IRU WKLV
SXUSRVH KDYH EHHQ WKH QFR JHQH ZKLFK FRQIHUV UHVLVWDQFH WR QHRP\FLQ DQG WKH EDFWHULDO
[DQWKLQHJXDQLQH SKRVSKRULERV\O WUDQVIHUDVH JSW  JHQH ZKLFK HQDEOHV PDPPDOLDQ FHOOV
FDUU\LQJ WKLV JHQH WR XWLOL]H [DQWKLQH UDWKHU WKDQ K\SR[DQWKLQH LQ WKH VDOYDJH SDWKZD\ RI
SXULQH ELRV\QWKHVLV 0HWKRGV VXFK DV FDOFLXP SKRVSKDWH FRSUHFLSLWDWLRQ DQG UHWURYLUDO
WUDQVGXFWLRQ KDYH EHHQ XVHG WR WUDQVIHU WKHVH PDUNHUV LQWR KXPDQ FHOOV DQG WR JHQHUDWH
PRQRFKURPRVRPDOK\EULGV

0LFURFHOOPHGLDWHGFKURPRVRPHWUDQVIHUKDVEHHQSDUWLFXODUO\XVHIXOLQWKHPDSSLQJRI
'1$UHSDLUJHQHV,QWKHVHVWXGLHVFRPSOHPHQWLQJ'1$UHSDLUJHQHVKDYHEHHQDVVLJQHGWR
SDUWLFXODU FKURPRVRPHV E\ LQGLYLGXDOO\ WUDQVIHUULQJ KXPDQ FKURPRVRPHV LQWR '1$ UHSDLU
GHIHFWLYHFHOOOLQHVDQGLGHQWLI\LQJWKHFKURPRVRPHVWKDWUHVWRUHSURILFLHQW'1$UHSDLU7KLV
WHFKQLTXH KDV DOVR EHHQ XVHG LQ RWKHU VWXGLHV VXFK DV FKURPRVRPDO ORFDOL]DWLRQ RI WXPRXU
VXSSUHVVRUJHQHVJHQHUHJXODWLRQPDQLSXODWLRQRIFKURPRVRPDODOOHOHVDQGLQWURGXFWLRQRI
KXPDQ PLQLFKURPRVRPHV LQWR PRXVH HPEU\RQDO VWHP FHOOV 7KH GRQRU FHOOV LQ 00&7
H[SHULPHQWV DUH XVXDOO\ URGHQW FHOOV FDUU\LQJ D VLQJOH KXPDQ FKURPRVRPH WDJJHG ZLWK D
VHOHFWDEOHPDUNHUVXFKDVJSWQHRRUK\JDQGDUHFDOOHGPRXVHKXPDQPRQRFKURPRVRPDO
K\EULGV 6HYHUDO JURXSV KDYH FRQVWUXFWHG PRQRFKURPRVRPDO K\EULG SDQHOV WKDW FDQ EH
REWDLQHG GLUHFWO\ IURP WKH ODERUDWRULHV WKDW FRQVWUXFWHG WKHP SXUFKDVHG IURP FRPPHUFLDO
FHQWUHV RU IURP SXEOLF UHVRXUFH LQVWLWXWHV VXFK DV &RULHOO &HOO 5HSRVLWRULHV
KWWSORFXVXPGQMHGXQLJPVK\EULGVVXPLQWURKWPO  DQG WKH 8. 05& +XPDQ *HQRPH

Ϯϯϭ

0DSSLQJ3URMHFW5HVRXUFH&HQWUH KWWSZZZKJPSPUFDFXN5HVHDUFK ,WPXVWEHQRWHG
WKDWLQVRPHFDVHVLQDGGLWLRQWRWKHVHOHFWHGLQWDFWKXPDQFKURPRVRPHDPRQRFKURPRVRPDO
K\EULGPD\KDYHUHWDLQHGDVPDOOIUDJPHQW V RIDQRWKHUKXPDQFKURPRVRPHDQGWKHUHIRUH
FDUHIXO FKDUDFWHUL]DWLRQ RI WKHVH K\EULGV LV HVVHQWLDO EHIRUH WKHLU XVH LQ DQ\ FKURPRVRPH
WUDQVIHUH[SHULPHQW

7KHSURFHGXUHRI00&7 LQYROYHV ILYH PDLQ VWDJHV ZKLFKDUH LOOXVWUDWHGLQ )LJXUH
DQGGHVFULEHGEHORZ


)LJXUH  0LFURFHOOPHGLDWHG FKURPRVRPH WUDQVIHU ,Q WKLV PHWKRG D VLQJOH
FKURPRVRPH WKDW LV WDJJHG ZLWK D GRPLQDQW PDUNHU VXFK DV WKH EDFWHULDO JXDQLQH
SKRVSKRULERV\OWUDQVIHUDVH JSW JHQH LVHQFDSVXODWHGLQWRDPLFURFHOOE\FROFHPLGLQGXFHG
PLFURQXFOHDWLRQRILWVGRQRUFHOO7KHPLFURFHOOLVWKHQH[WUXGHGIURPWKHPLFURQXFOHDWHFHOO
E\FHQWULIXJDWLRQLQDGLVFRQWLQXRXV)LFROOJUDGLHQWFRQWDLQLQJF\WRFKDODVLQ%DQGWKHQVL]H
IUDFWLRQDWHG LQ D FRQWLQXRXV )LFROO JUDGLHQW )XVLRQ RI WKH PLFURFHOO WR D UHFLSLHQW FHOO DQG
JURZWK LQ 0; PHGLXP PHGLXPFRQWDLQLQJ P\FRSKHQROLF DFLGDQG [DQWKLQH  JLYHV ULVH WR
FRORQLHVRIPLFURFHOOK\EULGVWKDWFRQWDLQWKHWDJJHGFKURPRVRPHIURPWKHGRQRUFHOO0; 
FXOWXUHPHGLXPFRQWDLQLQJP\FRSKHQROLFDFLGDQG[DQWKLQH0;5 UHVLVWDQWWR0;0;6 
VHQVLWLYHWR0;

)RUPDWLRQRIPLFURQXFOHL

0LFURQXFOHDWLRQ GHVFULEHV WKH SURFHVV RI IRUPDWLRQ RI PLFURQXFOHL DQG LV LQGXFHG E\
WUHDWLQJ GRQRU FHOOV ZLWK D PLWRWLF LQKLELWRU VXFK DV FROFHPLG 7UHDWPHQW RI WKH FHOOV ZLWK
VXEOHWKDO GRVHV RI FROFHPLG UHVXOWV LQ GLVUXSWLRQ RI PLFURWXEXOH IRUPDWLRQ GXULQJ FHOO
GLYLVLRQ IROORZHG E\ WKH IRUPDWLRQ RI PLFURQXFOHL ZKHQ WKH FHOOV HQWHU LQWHUSKDVH (DFK
PLFURQXFOHXVFRQWDLQVRQHRUDIHZFKURPRVRPHVZLWKLQDPHPEUDQH

7KH DSSURSULDWH GRVH RI FROFHPLG KDV WR EH GHWHUPLQHG HPSLULFDOO\ ,Q JHQHUDO
PLFURQXFOHDWLRQ FDQ EH LQGXFHG LQ URGHQW FHOOV ZLWK ORZHU GRVHV  —JPO  RI
FROFHPLGWKDQLQKXPDQFHOOVZKLFKQHHGKLJKHUFRQFHQWUDWLRQV QJPO RIWKLVGUXJ
,QWKH00&7PLFURQXFOHDWLRQLVDFKLHYHGE\SURORQJHGLQFXEDWLRQ KRXUV RIPRXVH
KXPDQ PRQRFKURPRVRPDO K\EULG FHOOV DV GRQRUV RI WKH KXPDQ FKURPRVRPH LQ PHGLXP

ϮϯϮ

FRQWDLQLQJ—JPORIFROFHPLG$QRWKHUPHWKRGKDVEHHQGHVFULEHGLQZKLFKWKHGRQRU
FHOOV DUH WUHDWHG ZLWK FROFHPLG IRU D VKRUWHU SHULRG RI WLPH  KRXUV  IROORZHG E\
LQFXEDWLRQ IRU  KRXUV DW ƒ& LQ PHGLXP FRQWDLQLQJ F\WRFKDODVLQ % ZKLFK LV D PLWRWLF
LQKLELWRUDQGLQGXFHVQXFOHDUH[WUXVLRQ


(QXFOHDWLRQ

:KHQ PLFURQXFOHDWH FHOOV DUH WUHDWHG ZLWK UHODWLYHO\ KLJK FRQFHQWUDWLRQV RI
F\WRFKDODVLQ% —JPO WKHPLFURQXFOHLFDQEHH[WUXGHGLQWZRZD\VDVPRQROD\HUFHOOV
RUDVFHOOVLQVXVSHQVLRQ

(QXFOHDWLRQRIPRQROD\HUFHOOV

0LFURQXFOHDWH FHOOV FDQ EH HQXFOHDWHG ZKLOH WKH\ DUH VWLOO DWWDFKHG WR WKH VXUIDFH RI
HLWKHUDWLVVXHFXOWXUHIODVNRUWRVWHULOHSLHFHVRISODVWLFFXWIURPWLVVXHFXOWXUHSODWHVLQWKH
VKDSHRIGLVNVRUEXOOHWV,IWKHFHOOVDUHDWWDFKHGWRDWLVVXHFXOWXUHIODVNWKHIODVNLVILOOHG
ZLWK VHUXPIUHH PHGLXP FRQWDLQLQJ  —JPO F\WRFKDODVLQ % DQG WKHQ FHQWULIXJHG ,I
&RQYHUVHO\PLFURQXFOHDWHFHOOVKDYHEHHQJHQHUDWHGRQGLVNVRUEXOOHWVWKH\DUHHQXFOHDWHG
E\ WUDQVIHUULQJ WKH GLVNV FHOO VLGH GRZQ WR  PO FHQWULIXJH WXEHV FRQWDLQLQJ VHUXPIUHH
PHGLXPVXSSOHPHQWHGZLWKXJPORIF\WRFKDODVLQ%DQGFHQWULIXJHGDWKLJKVSHHG7KHJ
IRUFHRIWKHFHQWULIXJDWLRQRIFRXUVHPXVWQRWH[FHHGWKHWROHUDEOHOLPLWIRUWKHWLVVXHFXOWXUH
IODVNRUWKHSUHFXWSODVWLFSLHFHV

(QXFOHDWLRQLQVXVSHQVLRQ

(QXFOHDWLRQLVDFKLHYHGE\ILUVWKDUYHVWLQJWKHPLFURQXFOHDWHFHOOVE\WU\SVLQL]DWLRQDQG
WKHQFHQWULIXJLQJWKHPLQDGLVFRQWLQXRXV)LFROOJUDGLHQWLQWKHSUHVHQFHRIF\WRFKDODVLQ%

3XULILFDWLRQRIPLFURFHOOV

7KH HQGUHVXOW RI HQXFOHDWLRQ RI PLFURQXFOHDWH FHOOV LV WKH UHOHDVH RI PLFURFHOOV DV
FRPSDUWPHQWV FRQWDLQLQJ VLQJOH RU MXVW D IHZ FKURPRVRPHV ZLWK D WKLQ ULP RI F\WRSODVP
HQFLUFOHGE\DFHOOPHPEUDQH0LFURFHOOVFDQEHSXULILHGRQWKHEDVLVRIWKHLUVL]HHLWKHUE\
XQLW JUDYLW\ VHGLPHQWDWLRQ RU E\ ILOWUDWLRQ WKURXJK SRO\FDUERQDWH QLWUHV ZLWK SRUH VL]H RI 
—P RU —P DOWHUQDWLYHO\ WKHFUXGHPLFURFHOO SUHSDUDWLRQ LV WUDQVIHUUHG LQWR WLVVXH FXOWXUH
IODVNVIROORZHGE\LQFXEDWLRQDWƒ&IRUVHYHUDOKRXUV,QWKLVSHULRGRILQFXEDWLRQZKLFK
YDULHV IRU GLIIHUHQW GRQRU FHOO W\SHV WKH FRQWDPLQDWLQJ FHOOV WKDW DUH LQWDFW DGKHUH WR WKH
VXUIDFH RI WKH WLVVXH FXOWXUH IODVNV DQG WKH PLFURFFOOV ZKLFK DUH QRQDGKHULQJ UHPDLQ
IORDWLQJLQWKHPHGLXPDQGFDQEHFROOHFWHG

)XVLRQRIPLFURFHOOVWRUHFLSLHQWFHOOV

7KHUH DUH WZR PDLQ PHWKRGV IRU WKH IXVLRQ RI PLFURFHOOV WR WKH UHFLSLHQW FHOOV 2QH
PHWKRGXVHVSRO\HWK\OHQHJO\FRO 3(* LQFRPELQDWLRQZLWKSK\WRKDHPDJJOXWLQLQ3 3+$
3 7KHUROHRI3+$3LQWKLVSURFHGXUHLVWRLQFUHDVHDJJOXWLQDWLRQRIWKHPLFURFHOOVWRWKH
VXUIDFHRIWKHUHFLSLHQWFHOOVDQGKHQFHHQKDQFHWKHIXVLRQHIILFLHQF\7KHRSWLPXPGXUDWLRQ
RI3(*WUHDWPHQWKDVWREHGHWHUPLQHGHPSLULFDOO\IRUHDFKFHOOW\SH$QDOWHUQDWLYHPHWKRG
XVHVLQDFWLYDWHG 6HQGDL YLUXV IRUIXVLQJWKH PLFURFHOOVWRWKHUHFLSLHQWFHOOVEXW WKHIRUPHU
PHWKRGLVPRUHZLGHO\XVHGRZLQJWRLWVHIILFLHQF\DQGVLPSOLFLW\

Ϯϯϯ

6HOHFWLRQRIPLFURFHOOK\EULGV
,QWKLVVWHSWKHPRQRFKURPRVRPDOK\EULGVDUHVHOHFWHGE\JURZLQJWKHIXVLRQSURGXFWV
LQPHGLXPFRQWDLQLQJDQDSSURSULDWHVHOHFWLYHDJHQW,IWKHKXPDQFKURPRVRPHVDUHWDJJHG
ZLWKWKHQHRRUK\JJHQHVQHRP\FLQRUK\JURP\FLQDUHXVHGWRVHOHFWWKHPRQRFKURPRVRPDO
K\EULGVUHVSHFWLYHO\,I&RQYHUVHO\WKHKXPDQFKURPRVRPHVDUHWDJJHGZLWKWKHJSWJHQH
WKH VHOHFWLRQ LV SHUIRUPHG E\ JURZLQJ WKH FHOOV LQ 0; PHGLXP FRQWDLQLQJ P\FRSKHQROLF
DFLGDQG[DQWKLQH7KHJSWJHQHLVWKHEDFWHULDODQDORJXHRIWKHPDPPDOLDQKSUWJHQHLQWKH
SXULQH ELRV\QWKHVLV SDWKZD\ 7KH SURGXFW RI WKLV JHQH XWLOL]HV [DQWKLQH LQVWHDG RI
K\SR[DQWKLQHZKLFKLVWKHVXEVWUDWHIRUWKH KSUWJHQHSURGXFW6HOHFWLRQLQ0;PHGLXPLV
WKHUHIRUHEDVHGRQEORFNLQJWKHHQGRJHQRXVSDWKZD\RISXULQHELRV\QWKHVLVE\P\FRSKHQROLF
DFLG DQGVXSSOHPHQWLQJWKHPHGLXPZLWK[DQWKLQH7KHUHIRUHRQO\ WKHFHOOVFRQWDLQLQJ WKH
JSWJHQHSURGXFWFDQXWLOL]HWKH[DQWKLQHFRPSRQHQWRIWKHVHOHFWLRQPHGLXPWRE\SDVVWKH
LQKLELWRU\HIIHFWRIP\FRSKHQROLFDFLGDQGVXUYLYH



)LJXUH  *UDGLHQW V\VWHP IRU VL]H IUDFWLRQDWLRQ RI PLFURFHOOV 7KLV LV D VFKHPDWLF
GLDJUDP RI D V\VWHP IRU SXULILFDWLRQ RI PLFURFHOOV E\ XQLW JUDYLW\ VHGLPHQWDWLRQ LQ D
FRQWLQXRXV)LFROOJUDGLHQW7KHJUDGLHQWPDNHULVFRQQHFWHGWRDPOERWWOHYLDDWXEHWKDW
LVVHDOHGZLWKDFODPS7KXVWKHFODPSFDQFRQWUROWKHIORZRIVROXWLRQWKURXJKWKHV\VWHP
7KHERWWOHLVDOVRFRQQHFWHGWRWKHERWWRPRIDUHVHUYRLUZKLFKFDQEHWKHEDUUHORIDPO
V\ULQJH7ZRPDJQHWLFVWLUUHUVRQHLQFKDPEHU%RIWKHJUDGLHQWPDNHUDQGRQHLQWKHERWWOH
DUH XVHGWR PL[ WKH VROXWLRQV JHQWO\ 7KHFRPSRQHQWV RIWKLV V\VWHP KDYH WR EH VWHULOH DQG
DVVHPEOHGRQDQRQYLEUDWLQJEHQFK7RSUHYHQWFRQWDPLQDWLRQLWLVQHFHVVDU\WRFRYHUWKH
JUDGLHQWPDNHUFKDPEHUVDQGWKHUHVHUYRLUZLWKSUHVWHULOL]HGDOXPLQLXPIRLOWKURXJKRXWWKH
SURFHVVEHIRUHDQGLPPHGLDWHO\DIWHUWKHDGGLWLRQRIVROXWLRQV7KLVDQGVXSSOHPHQWLQJWKH
FXOWXUH PHGLXP ZLWK DPSKRWHULFLQ % DIWHU WKH IXVLRQ VWHS KHOSV SUHYHQW \HDVW DQG IXQJDO
LQIHFWLRQRIWKHFHOOV

,UUDGLDWLRQIXVLRQJHQHWUDQVIHU

7KH WHFKQLTXH RI LUUDGLDWLRQ IXVLRQ JHQH WUDQVIHU ,)*7  DOORZV WKH JHQHUDWLRQ RI D
YDULHG DUUD\ RI K\EULGV WKDW FDQ EH XVHG LQ LQYHVWLJDWLRQV VXFK DV JHQH PDSSLQJ DQGRU

Ϯϯϰ

SRVLWLRQDO FORQLQJ RI JHQHV )LJXUH  LV D VFKHPDWLF LOOXVWUDWLRQ RI WKH ,)*7 WHFKQLTXH IRU
UHGXFLQJWKHDPRXQWRIKXPDQ'1$LQVRPDWLFFHOOK\EULGV



)LJXUH  ,UUDGLDWLRQ IXVLRQ JHQH WUDQVIHU &KURPRVRPHV RI GRQRU FHOOV WKDW FDUU\ D
VHOHFWDEOHPDUNHUDUHIUDJPHQWHGE\H[SRVXUHRIWKHFHOOVWRKLJKGRVHVRILRQL]LQJUDGLDWLRQ
7KHLUUDGLDWHGFHOOVDUHWKHQUHVFXHGE\IXVLQJWKHPWRDUHFLSLHQWFHOOOLQHWKDWLVVHQVLWLYHWR
WKH VHOHFWLYH PDUNHU 7KH UHVXOWLQJ K\EULGV WKDW UHWDLQ IUDJPHQWV RI WKH GRQRU FHOO
FKURPRVRPHVDUHLVRODWHGE\VHOHFWLRQLQPHGLXPFRQWDLQLQJWKHVHOHFWLYHPDUNHU2XDEDLQ5
UHVLVWDQWWRRXDEDLQ2XDEDLQ6VHQVLWLYHWRRXDEDLQ

8VHLQPDSSLQJJHQHV

7KH ,)*7 WHFKQLTXH ZDV ILUVW LQWURGXFHG E\ *RVV DQG +DUULV   7KH\ EDVHG WKHLU
ZRUNRQWZRREVHUYDWLRQV

D ,RQL]LQJ UDGLDWLRQ EUHDNV FKURPRVRPHV LQWR VPDOOHU IUDJPHQWV ZLWK VL]HV WKDW DUH
SURSRUWLRQDO WR WKH UDGLDWLRQ GRVH 7KHUHIRUH WKH FORVHU WZR JHQHV DUH WRJHWKHU WKH
PRUH OLNHO\ WKH\ DUH WR VHJUHJDWH ZLWKLQ D VHJPHQW RI '1$ DIWHU WUHDWPHQW ZLWK
LRQL]LQJUDGLDWLRQ
E )UDJPHQWV RI IRUHLJQ '1$ FDQ XQGHU FHUWDLQ FRQGLWLRQV EH LQWURGXFHG LQWR
PDPPDOLDQFHOOVZKHUHWKH\FDQUHSOLFDWHDQGH[SUHVVWKHLUJHQHV

,Q WKHLU VWXG\ *RVV DQG +DUULV GHWHUPLQHG WKH OLQNDJH EHWZHHQ IRXU ; FKURPRVRPH
JHQHVDQGWKHLURUGHU7KHVHJHQHVZHUHWKRVHFRGLQJIRUWKHHQ]\PHVK\SR[DQWKLQHJXDQLQH
SKRVSKRULERV\O WUDQVIHUDVH +357  SKRVSKRJO\FHUDWH NLQDVH 3*.  JOXFRVHSKRVSKDWH
GHK\GURJHQDVH *3' DQGDJDODFWRVLGDVH DJDO ,UUDGLDWHGO\PSKRF\WHVZHUHIXVHGWRD
KDPVWHUFHOOOLQHODFNLQJ+357DFWLYLW\8QIXVHGO\PSKRF\WHVZHUHUHPRYHGE\ZDVKLQJDQG
WKH K\EULGV ZHUH JURZQ XQGHU +$7 VHOHFWLRQ PHGLXP FRQWDLQLQJ K\SR[DQWKLQH
DPLQRSWHULQDQGWK\PLGLQH 7KHUHIRUHRQO\WKHUHFLSLHQWVRIWKHKXPDQW+357JHQHFRXOG
VXUYLYH ,W ZDV VKRZQ WKDW ERWK WKH JHQH RUGHU DQG GLVWDQFH EHWZHHQ WKH JHQHV FRXOG EH
GHWHUPLQHGE\WKLVWHFKQLTXH

,)*7ZDVDOVRXVHGWRPDS'1$SUREHVIURPDUHJLRQRIKXPDQFKURPRVRPHT
VSDQQLQJ  0E 7KHVH H[SHULPHQWV VWDUWHG ZLWK D &KLQHVH KDPVWHUKXPDQ VRPDWLF FHOO
K\EULG FRQWDLQLQJ D VLQJOH FRS\ RI KXPDQ FKURPRVRPH T DQG YHU\ OLWWOH RWKHU KXPDQ

Ϯϯϱ

FKURPRVRPDOPDWHULDO7KH KDPVWHUKXPDQK\EULGFHOOVZHUHLUUDGLDWHGZLWK*\;UD\V
7KH OHWKDOO\ LUUDGLDWHG FHOOV ZHUH IXVHG WR KDPVWHU FHOOV ODFNLQJ WKH +357 JHQH DQG WKH
K\EULGV ZHUH VHOHFWHG LQ +$7 PHGLXP ,Q WKLV VHOHFWLRQ RQO\ WKRVH K\EULGV ZKLFK KDG
UHFHLYHGWKHKDPVWHU+357JHQHIURPWKHLUUDGLDWHGFHOOVFRXOGVXUYLYH7KHUHIRUHWKHUHZDV
QRGLUHFWVHOHFWLRQIRUKXPDQVHTXHQFHV7KHSUHVHQFHRIWKHPDUNHUVLQWKHUDGLDWLRQK\EULGV
ZDVFRQILUPHGE\6RXWKHUQEORWK\EULGL]DWLRQDQDO\VLVDQGLWZDVIRXQGWKDWHDFKRIWKH
FKURPRVRPHPDUNHUVZDVUHWDLQHGLQRIWKHUDGLDWLRQK\EULGV6WDWLVWLFDODQDO\VLV
RQ WKH UHVXOWV ZDV WKHQ XVHG WR FRQVWUXFW D PDS RI WKH PDUNHUV RQ FKURPRVRPH  7KHVH
PDSSLQJ GDWD ZHUH LQ DJUHHPHQW ZLWK WKRVH REWDLQHG IURP SXOVHILHOG JHO HOHFWURSKRUHVLV
VWXGLHVLQGLFDWLQJWKDWLWLVSRVVLEOHWRGHWHUPLQHWKHGLVWDQFHEHWZHHQGLIIHUHQWPDUNHUVDQG
WKHLU RUGHU RQ WKH FKURPRVRPH E\ HVWLPDWLQJ WKH IUHTXHQF\ RI EUHDNDJH EHWZHHQ WKHP
5DGLDWLRQ K\EULG SDQHOV KDYH EHFRPH YHU\ XVHIXO WRROV LQ PDSSLQJ KXPDQ JHQHV EHFDXVH
WKH\ FDQ EH VFUHHQHG E\ SRO\PRUSKLF DV ZHOO DV QRQSRO\PRUSKLF PDUNHUV ZKLFK DUH
XQLQIRUPDWLYH LQ OLQNDJH PDSSLQJ 2QH VXFK SDQHO LV WKH *HQH%ULGJH UDGLDWLRQ K\EULG
PDSSLQJ SDQHO ZKLFK LV DYDLODEOH IURP WKH 8. 05& +XPDQ *HQRPH 0DSSLQJ 3URMHFW
5HVRXUFH&HQWUH8.05&+*035& KWWSZZZKJPSPUFDFXN5HVHDUFK 7KLVSDQHO
FRQVLVWV RI  FORQHV RI WKH ZKROH KXPDQ JHQRPH DQG FDQ EH XVHG IRU RUGHULQJ JHQHWLF
PDUNHUVDQGHVWLPDWLQJWKHLUGLVWDQFHV$IWHUREWDLQLQJWKHSDQHOWKHLQYHVWLJDWRUVFUHHQVWKLV
SDQHO ZLWK WKH PDUNHU RI LQWHUHVW DQG VXEPLWV WKH GDWD WR WKH 8. 05& +*035& ZKHUH
WKH\DUHVWDWLVWLFDOO\DQDO\VHGDQGWKHUHVXOWVUHWXUQHG

8VHLQSRVLWLRQDOFORQLQJ

7KH PRVW LPSRUWDQW IDFWRU LQ WKH SRVLWLRQDO FORQLQJ RI D JHQH LV WKH LGHQWLILFDWLRQ RU
LVRODWLRQRIPDUNHUVWKDWDUHWLJKWO\OLQNHGWRWKDWJHQH2QHSRVVLEOHZD\WRDFKLHYHWKLVLVWR
XVHWKHPHWKRGRI,)*7WRFRQVWUXFWDSDQHORIUDGLDWLRQUHGXFHGK\EULGV,IIRUH[DPSOHWKH
DLPLVWRFORQHDKXPDQJHQHIRUZKLFKQRWLJKWO\OLQNHGPDUNHUKDVEHHQLGHQWLILHGDK\EULG
LV JHQHUDWHG WKDW FRQWDLQV WKH VPDOOHVW SRVVLEOH FKURPRVRPHIUDJPHQW FDUU\LQJ WKH JHQH RI
LQWHUHVW ,Q WKLV FDVH WKH EHVW GRQRU FHOO LV D KXPDQURGHQW PRQRFKURPRVRPDO K\EULG RU D
K\EULG WKDW FRQWDLQV RQO\ D VHJPHQW RI WKH KXPDQ FKURPRVRPH FDUU\LQJ WKH JHQH 7KH
JHQHUDWHG UDGLDWLRQ UHGXFHG K\EULGV FDQ WKHQ EH DQDO\VHG XVLQJ WHFKQLTXHV VXFK DV
SRO\PHUDVHFKDLQ UHDFWLRQ 3&5  RU 6RXWKHUQ EORW K\EULGL]DWLRQ IRU WKH SUHVHQFH RI NQRZQ
PDUNHUVLQ WKHFULWLFDO UHJLRQ 7KLVFDQ OHDG WR WKH LGHQWLILFDWLRQ RIDPDUNHUWKDWLVFORVHO\
OLQNHGWRWKHJHQH0RUHRYHUQHZVHTXHQFHWDJJHGVLWH 676 PDUNHUVFDQEHJHQHUDWHGIURP
WKHK\EULGZLWKWKHOHDVWDPRXQWRIKXPDQ'1$E\WKHPHWKRGRILQWHU$OXUHSHDWVHTXHQFH
3&5 ,563&5 ZKLFKDPSOLILHVVHTXHQFHVEHWZHHQWKH$OXUHSHDWHOHPHQWV7KHQHZ676
PDUNHUV DUH WKHQ DQDO\VHG IRU WKHLU OLQNDJH WR WKH JHQH DQG IRU LVRODWLRQ RI \HDVW DUWLILFLDO
FKURPRVRPHV <$&V WKDWVHUYHDVWKHSULPDU\WRROVIRUWKHQH[WVWDJHRISRVLWLRQDOFORQLQJ

$SRLQWWRFRQVLGHULQWKHJHQHUDWLRQRIUDGLDWLRQUHGXFHGK\EULGVIRUSRVLWLRQDOFORQLQJ
E\,)*7LVWKDWEHFDXVHWKHVHOHFWDEOHPDUNHURQWKHKXPDQFKURPRVRPHLVOLNHO\WREHWRR
IDU DZD\ IURP WKH JHQH GLUHFW VHOHFWLRQ IRU WKH KXPDQ FKURPRVRPH FDQQRW EH DSSOLHG
7KHUHIRUHLWLVQHFHVVDU\WRJHQHUDWHGRQRUPRQRFKURPRVRPDOK\EULGFHOOVZLWKDVHOHFWDEOH
PDUNHU HJRXDEDLQUHVLVWDQFH RQWKHQRQKXPDQFKURPRVRPHVRUXVHUHFLSLHQWFHOOVWKDW
DUH GHIHFWLYH LQ D JHQH VXFK DV +357 7KXV VHOHFWLRQ RI WKH UDGLDWLRQ UHGXFHG K\EULGV LV
DFKLHYHGE\JURZLQJWKHFHOOVLQRXDEDLQRU+$7PHGLXP7KLVWKHUHIRUHOLPLWVWKHXVHRI
,)*7LQSRVLWLRQDOFORQLQJRIDJHQHWRLQVWDQFHVZKHUHWKHJHQHKDVSKHQRW\SLFHIIHFWVLQWKH
UHVXOWLQJK\EULGVRUZKHUHIODQNLQJPDUNHUVKDYHEHHQLGHQWLILHG$QH[DPSOHRIVXFFHVVIXO
XVHRIWKH,)*7WHFKQLTXHLQSRVLWLRQDOFORQLQJRIDJHQHLVWKHLGHQWLILFDWLRQRINXDVWKH
PXWDQWJHQHLQWKH'1$UHSDLUGHILFLHQW[UVFHOOV

Ϯϯϲ

,UUDGLDWLRQGRVHV

7KHUHODWLRQVKLSEHWZHHQWKHGRVHRILUUDGLDWLRQDQGWKHVL]HRUQXPEHURIKXPDQ'1$
IUDJPHQWVUHWDLQHGLQWKHUHFLSLHQWFHOOVKDVEHHQVWXGLHGE\XVLQJDKDPVWHUKXPDQVRPDWLF
FHOOK\EULGFRQWDLQLQJKXPDQFKURPRVRPHVDQG;DVWKHVRXUFHRIKXPDQ'1$IUDJPHQWV
7KHVHFHOOVZHUHLUUDGLDWHGZLWKDOHWKDOGRVHRI*\\UD\V7KHLUUDGLDWHGFHOOVZHUH
UHVFXHGE\IXVLQJWKHPWRDWK\PLGLQHNLQDVH  7. KDPVWHUFHOOOLQHIROORZHGE\VHOHFWLRQ
RIWKHUDGLDWLRQK\EULGVLQ+$7PHGLXPDOORZLQJRQO\WKHVXUYLYDORIK\EULGVUHFHLYLQJWKH
KDPVWHU 7N JHQH $OX3&5 DQDO\VLV VKRZHG WKH SUHVHQFH RI XQVHOHFWHG KXPDQ '1$
VHTXHQFHV LQ WKH LVRODWHG K\EULGV 7KH SUHVHQFH RU DEVHQFH RI PDUNHUV VSHFLILF WR
FKURPRVRPHRU;LQWKHK\EULGVZDVDOVRWHVWHG7KLVDQDO\VLVDVZHOODVIOXRUHVFHQFHLQ
VLWX K\EULGL]DWLRQ ),6+  VWXGLHV RQ WKH UDGLDWLRQ K\EULGV VXJJHVWHG WKDW WKH QXPEHU RI
KXPDQ'1$IUDJPHQWV LQWKHVHK\EULGVZDV LQGHSHQGHQW RI WKH LUUDGLDWLRQGRVH +RZHYHU
WKHVL]HVRIWKHIUDJPHQWVZHUHGRVHGHSHQGHQW%\LQFUHDVLQJWKHLUUDGLDWLRQGRVHIURPWR
*\DILYHWRWHQIROGUHGXFWLRQLQWKHVL]HVRIWKHODUJHVWIUDJPHQWVZDVREVHUYHG$OVR
KXPDQPDUNHUUHWHQWLRQIUHTXHQFLHVGHFOLQHGIURPWR7KH;T;TUHJLRQZDV
XVHGDVDPRGHOWRHVWLPDWHWKHVL]HUDQJHRIWKHUHWDLQHGIUDJPHQWVLQWKHUDGLDWLRQK\EULGV
RIWKHK\EULGVJHQHUDWHGIROORZLQJ*\\UD\VUHWDLQHGIUDJPHQWVLQWKHUDQJHRI
0EUHWDLQHGWKHZKROHFKURPRVRPHDUPDQGWKHUHPDLQLQJUHWDLQHGIUDJPHQWVRI
OHVV WKDQ  0E 7KH UHWHQWLRQ RI  0E RU ODUJHU IUDJPHQWV GHFUHDVHG WR OHVV WKDQ  LQ
K\EULGVJHQHUDWHGDWWKHKLJKHUGRVHRI*\

5HIHUHQFHV

$QGHUVRQ 0 - )DVFKLQJ & / ;X + - %HQHGLFW : ) DQG 6WDQEULGJH ( -  
*HQHV&KURPRVRPHV&DQFHU
$WKZDO566PDUVK06HDUOH%0DQG'HR66  6RPDW&HOO0RO*HQHW

&DSHFFKL05  &HOO
&KHNPDUHYD 0 $ +ROORZHOO & 0 6PLWK 5 & 'DYLV ( 0 /H%HDX 0 0 DQG
5LQNHU6FKDHIIHU&:  3URVWDWH
&KHQ&DQG2ND\DPD+  0RO&HOO%LRO
&KX*+D\DNDZD+DQG%HUJ3  1XFOHLF$GGV5HV
&RWWHU)('DV6'RXHN(&DUWHU13DQG<RXQJ%'  *HQRPLFV
&R['5 %XUPHLVWHU03ULFH( 5 .LP 6 DQG 0\HUV 5 0   6FLHQFH 

&U\VWDO5*0F(OYDQH\1*5RVHQIHOG0$&KX&60DVWUDQJHOL$+D\-*
HWDO  1DWXUH*HQHW
'HVPD]H&=XFPDQ-'HODWWUH27KRPDV*DQG$XULDV$  +XP*HQHW

'LHNHQ ( 6 (SQHU ( 0 )LHULQJ 6 )RXUQLHU 5 ( DQG *URXGLQH 0   1DWXUH
*HQHW
)RXUQLHU 5 ( .   ,Q 7HFKQLTXHVLQ VRPDWLFFHOO JHQHWLFV HG -: 6KD\  S 
3OHQXP3UHVV1HZ<RUNDQG/RQGRQ
*DLOODUG&DQG6WUDXVV)  1XFOHLF$FLGV5HV
*DR;DQG+XDQJ/  *HQH7KHQ
*RVV6-DQG+DUULV+  1DWXUH
*UDKDP)/DQGYDQGHU(E$-  9LURORJ\
*UDZ6'DYLGVRQ-*XVHOOD-:DWNLQV37DQ]L51HYH5HWDO  6RPDW&HOO
0RO*HQHW

Ϯϯϳ

*\DSD\*6FKPLWW.)L]DPHV&-RQHV+9HJD&]DUQ\16SLOOHWW'HWDO  
+XP0RO*HQHW
+DIH]SDUDVW0.DXU*3=G]LHQLFND0$WKZDO56/HKPDQQ$5DQG-HJJR3
$  6RPDW&HOO0RO*HQHW
+DUULQJWRQ5'DQG*HEDOOH$3  $QQ&OLQ/DE6G
+LUW%  -0RO%LRO
+XJ3DQG6OHLJKW5*  %LRFKLP%LRSK\V$FWD
,VKL]DNL . 2VKLPXUD 0 6DVDNL 0 6 1DNDPXUD < DQG ,NHQDJD 0   0XWDW
5HV
-HJJR3$+DIH]SDUDVW07KRPSVRQ$)%URXJKWRQ%&.DXU*3=G]LHQLFND
0=HWDO  3URF1DWO$FDG6UL86$
-ROO\'-(VW\$&%HUQDUG+8DQG)ULHGPDQQ7  3URF1DWO$FDG6UL86$

-RUGDQ06FKDOOKRUQ$DQG:XUP)0  1XFOHLF$FLGV5HV
.DQDPRUL+DQG6LHJHO-1  ([S&HOO5HV
.DXU*3DQG$WKZDO56  3URF1DWO$FDG6FL86$
.DXU*3DQG$WKZDO56  6RPDW&HOO0RO*HQHW
.RL 0 8PDU $ &KDXKDQ ' 3 &KHULDQ 6 3 &DUHWKHUV - 0 .XQNHO 7 $ HW DO
 &DQFHU5HV
/DPEHUW&6FKXOW]5$6PLWK0:DJQHU0F3KHUVRQ&0F'DQLHO/''RQORQ7
HWDO  3URF1DWO$FDG6UL86$
/HJHUVNL5DQG3HWHUVRQ&  1DWXUH
/HPHU 7 - ' $ULJR . / +DLQHV - / 'RJJHWW 1 $ 7DVFKQHU 3 ( GH 9RV 1 HW
DO  $P-0HG*HQHW
/L4+X1'DJJHWW0$&KX:$%LWWHO'-RKQVRQ-$HWDO  1XFOHLF
$FLGV5HV
/RZ\,3HOOLFHU$-DFNVRQ-)6LP*.6LOYHUVWHLQ6DQG$[HO5  &HOO

/XJR7*+DQGHOLQ%.LOODU\$0+RXVPDQ'(DQG)RXUQLHU5(  0RO
&HOO%LRO
0DWVXGD 7 6DVDNL 0 .DWR + <DPDGD + &RKHQ 0 %DUUHWW - & HW DO  
2QFRJHQH
0F&XWFKDQ-+DQG3DJDQR-6  -1DWO&DQFHU,QVW
0F1DOO\0$/HENRZVNL-62NDUPD7%DQG/HUFK/%  %LRWHFKQLTXHV

0HJXUR00LWVX\D.6XL+6KLJHQDPL..XJRK+1DNDR0HWDO  +XP
0RO*HQHW
1HXPDQQ(6FKDHIHU5LGGHU0:DQJ<DQG+RIVFKQHLGHU3+  (0%2-

1LHXZHQKXLMVHQ%:&KHQ./&KLQDXOW$&:DQJ69DOPLNL9+0HHUVKRHN
(-HWDO  +XP0RO*HQHW
2 %ULDQW . -ROLFRHXU ( *DUVW - &DPSD 0 6FKUHLEHU * DQG %HSOHU *  
$QWWFDQFHU5HV
2VKLPD-<X&(%RHKQNH0:HEHU-/(GHOKRII6:DJQHU0-HWDO  
*HQRPLFV
3DOHVH3DQG5RL]PDQ%  3URF1DWO$FDG6FL86$
3HUXFKR0+DQDKDQ'/LSVLFK/DQG:LJOHU0  1DWXUH
3HUXFKR0+DQDKDQ'DQG:LJOHU0  &HOO
3RWWHU+:HLU/DQG/HGHU3  3URF1DWO$FDG6UL86$

Ϯϯϴ

5DGRPVND + 6 6DWWHUWKZDLWH $ % %XUQ 7 & 2OLII , $ DQG 7HQHQ ' *  
*HQH
5LQJHUW]15  1DWO&DQFHU,QVW0RQRJU
5REHUWVRQ*3+XIIRUG$DQG/XJR7*  &\WRJHQHW&HOO*HQHW
5RELQV'05LSOH\6+HQGHUVRQ$6DQG$[HO5  &HOO
5RQ + 6RQRGD < .XPDEH 7 <RVKLPRWR 7 6HNL\D 7 DQG 0XUDNDPL <  
2QFRJHQH
6D[RQ3-6ULYDWVDQ(6/HLS]LJ*96DPHVKLPD-+DQG6WDQEULGJH(-  
0RO&HOO%LRO
6KDSHUR 0 + /DQJVWRQ $ $ DQG )RXUQLHU 5 (   6RPDW &HOO 0RO *HQHW 

6KHQ 0 + <DQJ - /RXSDUW 0 / 6PLWK $ DQG %URZQ :   +XP 0RO
*HQHW
6LGHQ76.XPOLHQ-6FKZDUW]&(DQG5RKPH'  6RPDW&HOO0RO*HQHW

6WDFNKRXVH0$2UWL]-%6DWR.DQG&KHQ'-  0XWDW5HV
6WDQJRV*$+XWWQHU.0-XULFHN'.DQG5XGGOH)+  0RO&HOO%LRO

6WDUFN - 'RXEHLNRYVNL $ 6DUUD]LQ 6 *RQQHW & 5DR * 6NRXOWFKL $ HW DO  
0RO&HOO%LRO
6WUDWKGHH&$*DYLVK+6KDQQRQ:5DQG%XFKZDOG0  1DWXUH
7DFFLROL * ( *RWWOLHE 7 0 %OXQW 7 3ULHVWOH\ $ 'HPHQJHRW - 0L]XWD 5 HW DO
 6FLHQFH
7DQDND.6DWRNDWD,2JLWD=8FKLGD7DQG2NDGD<  3URF1DWO$FDG6UL
86$
=LPPHUPDQ8  %LRFKLP%LRSK\V$FWD

























Ϯϯϵ

 &KDSWHU
6WHP&HOOV

6WHP&HOO

6WHPFHOOVDUHDFODVVRIXQGLIIHUHQWLDWHGFHOOVWKDWDUHDEOHWRGLIIHUHQWLDWHLQWRVSHFLDOL]HGFHOO
W\SHVIRXQGLQPRVWLIQRWDOOPXOWLFHOOXODURUJDQLVPV5HVHDUFKLQWKHVWHPFHOOILHOGJUHZRXWRI
ILQGLQJV E\ &DQDGLDQ VFLHQWLVWV (UQHVW $ 0F &XOORFK DQG -DPHV ( &RPPRQO\ VWHP FHOOV FRPH
IURPWZRPDLQVRXUFHV(PEU\RVIRUPHGGXULQJWKHEODVWRF\VWSKDVHRIHPEU\RORJLFDOGHYHORSPHQW
HPEU\RQLFVWHPFHOOV DQG$GXOWWLVVXH DGXOWVWHPFHOOV %RWKW\SHVDUHJHQHUDOO\FKDUDFWHUL]HGE\
WKHLUSRWHQF\RUSRWHQWLDOWRGLIIHUHQWLDWHLQWRGLIIHUHQWFHOOW\SHV VXFKDVVNLQPXVFOHERQHHWF 
,QDGXOWRUJDQLVPVVWHPFHOOVDQGSURJHQLWRUFHOOVDFWDVDUHSDLUV\VWHPIRUWKHERG\UHSOHQLVKLQJ
VSHFLDOL]HGFHOOVEXWDOVRPDLQWDLQWKHQRUPDOWXUQRYHURIUHJHQHUDWLYHRUJDQVVXFKDVEORRGVNLQ
RU LQWHVWLQDO WLVVXHV 6WHP FHOOV FDQ QRZ EH JURZQ DQG WUDQVIRUPHG LQWR VSHFLDOL]HG FHOOV ZLWK
FKDUDFWHULVWLFVFRQVLVWHQWZLWKFHOOVRIYDULRXVWLVVXHVVXFKDVPXVFOHVRUQHUYHVWKURXJKFHOOFXOWXUH
+LJKO\SODVWLFDGXOWVWHP FHOOVIURPDYDULHW\RI VRXUFHVLQFOXGLQJXPELOLFDOFRUGEORRGDQGERQH
PDUURZ DUH URXWLQHO\ XVHG LQ PHGLFDO WKHUDSLHV (PEU\RQLF FHOO OLQHV DQG DXWRORJRXV HPEU\RQLF
VWHP FHOOV JHQHUDWHGWKURXJK WKHUDSHXWLF FORQLQJ KDYH DOVR EHHQ SURSRVHG DV SURPLVLQJ FDQGLGDWHV
IRUIXWXUHWKHUDSLHV

3URSHUWLHV
7KHFODVVLFDOGHILQLWLRQRIDVWHPFHOOUHTXLUHVWKDWLWSRVVHVVWZRSURSHUWLHV

 6HOIUHQHZDO  WKH DELOLW\ WR JR WKURXJK QXPHURXV F\FOHV RI FHOO GLYLVLRQ ZKLOH
PDLQWDLQLQJWKHXQGLIIHUHQWLDWHGVWDWH
 3RWHQF\WKHFDSDFLW\WRGLIIHUHQWLDWHLQWRVSHFLDOL]HGFHOOW\SHV,QWKHVWULFWHVWVHQVH
WKLVUHTXLUHVVWHPFHOOVWREHHLWKHUWRWLSRWHQWRUSOXULSRWHQWWREHDEOHWRJLYHULVHWR
DQ\PDWXUHFHOOW\SHDOWKRXJKPXOWLSRWHQWRUXQLSRWHQWSURJHQLWRUFHOOVDUHVRPHWLPHV
UHIHUUHGWRDVVWHPFHOOV

3RWHQF\

x 3OXULSRWHQW HPEU\RQLF VWHP FHOOV RULJLQDWH DV LQQHU PDVV FHOOV ZLWKLQ D EODVWRF\VW
7KH VWHP FHOOV FDQ EHFRPH DQ\ WLVVXH LQ WKH ERG\ H[FOXGLQJ D SODFHQWD 2QO\ WKH
PRUXOD VFHOOVDUHWRWLSRWHQWDEOHWREHFRPHDOOWLVVXHVDQGDSODFHQWD
x 7RWLSRWHQW  WKH DELOLW\ WR GLIIHUHQWLDWH LQWR DOO SRVVLEOH FHOO W\SHV ([DPSOHVDUHWKH
]\JRWHIRUPHGDWHJJIHUWLOL]DWLRQDQGWKHILUVWIHZFHOOVWKDWUHVXOWIURPWKHGLYLVLRQ
RIWKH]\JRWH
x 3OXULSRWHQW  WKH DELOLW\ WR GLIIHUHQWLDWH LQWR PRVW FHOO W\SHV ([DPSOHV LQFOXGH
HPEU\RQLF VWHPFHOOV DQG FHOOV WKDW DUH GHULYHG IURP WKH PHVRGHUP HQGRGHUP DQG
HFWRGHUPJHUPOD\HUVWKDWDUHIRUPHGLQWKHEHJLQQLQJVWDJHVRIHPEU\RQLFVWHPFHOO
GLIIHUHQWLDWLRQ
x 0XOWLSRWHQW  WKH DELOLW\ WR GLIIHUHQWLDWH LQWR D FORVHO\ UHODWHG IDPLO\ RI FHOOV
([DPSOHV LQFOXGH KHPDWRSRLHWLF DGXOW  VWHP FHOOV WKDW FDQ EHFRPH UHG DQG ZKLWH
EORRGFHOOVRUSODWHOHWV
x 2OLJRSRWHQW  WKH DELOLW\ WR GLIIHUHQWLDWH LQWR D IHZ FHOOV ([DPSOHV LQFOXGH DGXOW 
O\PSKRLGRUP\HORLGVWHPFHOOV

ϮϰϬ

 x 8QLSRWHQWWKHDELOLW\WRRQO\SURGXFHFHOOVRIWKHLURZQW\SHEXWKDYHWKHSURSHUW\
RI VHOIUHQHZDO UHTXLUHG WR EH ODEHOHG D VWHP FHOO ([DPSOHV LQFOXGH DGXOW  PXVFOH
VWHPFHOOV

%DVLFSULQFLSOHVIRULGHQWLILFDWLRQDQGSXULILFDWLRQRIVWHPFHOOV
$OWKRXJK WKHUH LV QRW FRPSOHWH DJUHHPHQW DPRQJ VFLHQWLVWV RI KRZ WR LGHQWLI\ VWHP
FHOOVPRVWWHVWVDUHEDVHGRQPDNLQJVXUHWKDWVWHPFHOOVDUHXQGLIIHUHQWLDWHGDQGFDSDEOHRI
VHOIUHQHZDO7HVWVDUHRIWHQFRQGXFWHGLQWKHODERUDWRU\WRFKHFNIRUWKHVHSURSHUWLHV
2QH ZD\ WR LGHQWLI\ VWHP FHOOV LQ D ODE DQG WKH VWDQGDUG SURFHGXUHIRUWHVWLQJ ERQH
PDUURZRUKHPDWRSRLHWLFVWHPFHOO +6& LVE\WUDQVSODQWLQJRQHFHOOWRVDYHDQLQGLYLGXDO
ZLWKRXW +6&V ,I WKH VWHP FHOO SURGXFHV QHZ EORRG DQG LPPXQH FHOOV LW GHPRQVWUDWHV LWV
SRWHQF\
&ORQRJHQLFDVVD\V D ODERUDWRU\ SURFHGXUH  FDQ DOVR EH XVHG LQ YLWURWRWHVW ZKHWKHU
VLQJOH FHOOV FDQ GLIIHUHQWLDWH DQG VHOIUHQHZ 5HVHDUFKHUV PD\ DOVR LQVSHFW FHOOV XQGHU D
PLFURVFRSH WR VHH LI WKH\ DUH KHDOWK\ DQG XQGLIIHUHQWLDWHG RU WKH\ PD\ H[DPLQH
FKURPRVRPHV
7RWHVWZKHWKHUKXPDQHPEU\RQLFVWHPFHOOVDUHSOXULSRWHQWVFLHQWLVWVDOORZWKHFHOOV
WRGLIIHUHQWLDWHVSRQWDQHRXVO\LQFHOOFXOWXUHPDQLSXODWHWKHFHOOVVRWKH\ZLOOGLIIHUHQWLDWHWR
IRUPVSHFLILFFHOOW\SHVRULQMHFWWKHFHOOVLQWRDQLPPXQRVXSSUHVVHGPRXVHWRWHVWIRUWKH
IRUPDWLRQRIDWHUDWRPD DEHQLJQWXPRUFRQWDLQLQJDPL[WXUHRIGLIIHUHQWLDWHGFHOOV 

(SLWKHOLDO WLVVXHV VXFK DV WKH HSLGHUPLV DQG WKH OLQLQJ RI WKH JXW VKDUH D FRPPRQ
IHDWXUHLQWKDWWKH\DUHFRQVWDQWO\VKHGGLQJFHOOVIURPWKHLURXWHUVXUIDFH7KLVFRQVWDQWFHOO
ORVVLVFRPSHQVDWHGE\FRQWLQXDOUHSODFHPHQWWKURXJKFHOOSUROLIHUDWLRQLQDKLJKO\UHJXODWHG
SURFHVV,QKXPDQVWKHHQWLUHRXWHUOD\HURIWKHVNLQLVVKHGGDLO\ZKLOHWKHHQWLUHHSLWKHOLDO
OLQLQJ RI WKH PRXVH JXW LV UHSODFHG HYHU\ WKUHH WR IRXU GD\V $V WKLV SURFHVV FRQWLQXHV
WKURXJKRXWOLIHLWKDVEHHQDUJXHGWKDWWKLVLVSURRIRIWKHH[LVWHQFHRIORQJOLYHGVWHPFHOOV
7KH GHILQLWLRQ RI VXFK D VWHP FHOO LV WKDW LW ODFNV FHUWDLQ WLVVXHVSHFLILF GLIIHUHQWLDWLRQ
PDUNHUVUHPDLQVLQWKHWLVVXHWKURXJKRXWOLIHUHWDLQLQJSUROLIHUDWLYHFDSDFLW\DQGJLYHVULVH
WR GDXJKWHUV VRPH RI ZKLFK JHQHUDWH GLIIHUHQWLDWHG FHOOV DQG RWKHUV ZKLFK DUH WKHPVHOYHV
VWHPFHOOV7KHFHOOVVKRXOGDOVREHFDSDEOHRIUHJHQHUDWLQJWKHWLVVXHDIWHULQMXU\,WKDVEHHQ
GHPRQVWUDWHG LQ WKH HSLGHUPLV WKDW WKH SUROLIHUDWLYH FRPSDUWPHQW FRQVLVWV QRW RQO\ RI VWHP
FHOOV DQG SRVWPLWRWLF FHOOV EXW DOVR RI D WUDQVLW DPSOLI\LQJ SRSXODWLRQ 7UDQVLW DPSOLI\LQJ
FHOOV DUH SURGXFHG LQLWLDOO\ E\ WKH GLYLVLRQ RI VWHP FHOOV DQG DOWKRXJK WKH\ KDYH D KLJK
SUROLIHUDWLYH FDSDFLW\ WKHLU OLIHVSDQ LV OLPLWHG DQG HYHQWXDOO\ DOO WKH FHOOV ZLOO GLIIHUHQWLDWH
DQGEHVKHGIURPWKHWLVVXH:KHQDSSURDFKLQJ WKHTXHVWLRQ RIZKHWKHU RU QRW DSDUWLFXODU
WLVVXHFRQWDLQVDGLVFUHWHVWHPFHOOSRSXODWLRQLWLVQHFHVVDU\WRHVWDEOLVKZKHWKHUWKHUHLVWUXH
SUROLIHUDWLYH KHWHURJHQHLW\ ZLWKLQ WKH WLVVXH 7KHUH DUH WKUHH SRVVLELOLWLHV ILUVW DOO WKHFHOOV
PD\KDYHHTXDOSUROLIHUDWLYHSRWHQWLDOVHFRQGO\RQO\DVXESRSXODWLRQRIQRQGLIIHUHQWLDWHG
FHOOVPD\GLYLGHRUWKLUGO\DVLQWKHVNLQWKHUHDUHWZRW\SHVRISUROLIHUDWLYHFHOOVWHPFHOOV
DQG WUDQVLW DPSOLI\LQJ FHOOV 7KH ODWWHU PD\ EH UHSUHVHQWHG E\ D FRQWLQXRXV GLVWULEXWLRQ RI
SUROLIHUDWLYHFDSDFLW\IURPXQOLPLWHGWRDVLQJOHGLYLVLRQRQO\$OWHUQDWLYHO\WKHUHPD\ZHOO
EH WZR FOHDU SUROLIHUDWLYH VXESRSXODWLRQV WKDW FDQ EH GLVWLQJXLVKHG E\ FULWHULD VXFK DV WKH
PRUSKRORJ\RIFRORQLHVSURGXFHGLQFHOOFXOWXUH

$VVHVVPHQWRISUROLIHUDWLYHKHWHURJHQHLW\


Ϯϰϭ

 ,QWKHHSLGHUPLVLW KDV EHHQ VKRZQWKDW WKHUH LVSUROLIHUDWLYHKHWHURJHQHLW\ZLWKLQWKH
NHUDWLQRF\WH SRSXODWLRQ %DUUDQGRQ DQG *UHHQ VKRZHG WKDW WKHUH DUH WKUHH W\SHV RI FRORQ\
IRUPHGZKHQWKHVHFHOOVDUHSODFHGLQFXOWXUHLQKLJKFDOFLXPPHGLXPLQWKHSUHVHQFHRID
7 IHHGHU OD\HU 7KH WKUHH FRORQ\ W\SHV IRUPHG DUH FDOOHG SDUDFORQHV PHURFORQHV DQG
KRORFORQHV DQG WKHVH FODVVLILFDWLRQV DUH EDVHG RQ WKH W\SH RI SURJHQ\ SURGXFHG E\ WKH
FRORQLHVZKHQWKH\DUHSDVVDJHGLQWRIUHVKGLVKHV )LJXUH 3DUDFORQHVIRUPVPDOOLUUHJXODU
FRORQLHVFRPSRVHGDOPRVWHQWLUHO\RIGLIIHUHQWLDWHGFHOOV&RORQLHVSURGXFHGE\KRORFORQHV
DUHODUJHDQGURXQGFRQVLVWLQJPRVWO\RIVPDOOFHOOVVXUURXQGLQJDFHQWUDOUHJLRQRIVWUDWLILHG
GLIIHUHQWLDWHGFHOOV0HURFORQHVSURGXFHFRORQLHVZKLFKGRQRWKDYHDVPRRWKRXWOLQHDQGDUH
VPDOOHU WKDQ WKRVH SURGXFHG E\ KRORFORQHV ,W LV EHOLHYHG WKDW WKH VWHP FHOOV SURGXFH
KRORFORQHV DQG WUDQVLW DPSOLI\LQJ FHOOV SDUDFORQHV 7KH RULJLQ RI PHURFORQHV LQ WKLV
GHILQLWLRQLVQRWFOHDUDOWKRXJKLWKDVEHHQVSHFXODWHGWKDWWKH\DUHSURGXFHGE\VWHPFHOOV
WKDW JHQHUDWH WUDQVLW DPSOLI\LQJ FHOOV DW D KLJKHU UDWH WKDQ WKRVH SURGXFLQJ KRORFORQHV
(SLWKHOLDOFHOOVIURPRWKHUWLVVXHVLQFOXGLQJSURVWDWHDOVRVKRZWKLVKHWHURJHQHLW\LQFORQDO
JURZWKSURSHUWLHVDQGWKLV W\SH RI H[SHULPHQWDODSSURDFK FRXOG ZHOOEHRIXVHLQVWHPFHOO
VWXGLHVLQWKHEUHDVWJXWHSLWKHOLXPDQGOLYHU$VIRUHSLGHUPDONHUDWLQRF\WHVWKUHHFRORQ\
W\SHVDUHIRUPHGVPDOODERUWLYHFORQHVODUJHURXQGIDVWJURZLQJFRORQLHVPDGHXSDOPRVW
H[FOXVLYHO\ RI VPDOO FHOOV DQG DQ LQWHUPHGLDWH FRORQ\ W\SH ZKLFK PD\ JURZ UDSLGO\ EXW
FRQWDLQVODUJHUGLIIHUHQWLDWHGFHOOVDQGLVLUUHJXODULQVKDSH&ORQLQJLVDXVHIXOWRROIRUWKH
DVVHVVPHQWRISUROLIHUDWLYHFDSDFLW\DQGGLIIHUHQWLDWLRQVWDWHRIGLIIHUHQWFRORQLHV,IWKHFHOO
W\SHFDQEHFORQHGIURPVLQJOHFHOOVLWLVSRVVLEOHWRDYRLGULQJFORQLQJDOWRJHWKHUDQGJURZ
VLQJOHFRORQLHVLQPPGLVKHV


)LJXUH:KHQNHUDWLQRF\WHVDUHFXOWXUHGDWORZGHQVLW\WKUHHW\SHVRIFRORQ\DUHVHHQ
LQ WKH SDUHQW FXOWXUH GLVK 6XEFORQLQJ RI WKH ODUJHVW W\SH RI FRORQ\ $  \LHOGV PDQ\ ODUJH
FRORQLHVDORQJZLWKVHYHUDOVPDOODQGVRPHDERUWLYHFRORQLHV6XEFORQLQJDVPDOOFRORQ\ & 
SURGXFHVRQO\VPDOODQGDERUWLYHFRORQLHVZKHUHDVDQDERUWLYHFRORQ\ % ZLOO SURGXFHQR
FRORQLHV /DUJH FRORQ\IRUPLQJ FHOOV EHKDYH OLNH VWHP FHOOV ZKHUHDV VPDOO FRORQ\IRUPLQJ
FHOOVEHKDYHOLNHWUDQVLWDPSOLI\LQJFHOOV

(PEU\RQLFVWHPFHOOV

ϮϰϮ

 (PEU\RQLF VWHP FHOOV DUH GHULYHG IURP D IRXU RU ILYHGD\ROG KXPDQ HPEU\R WKDW LV LQ WKH
EODVWRF\VWSKDVHRIGHYHORSPHQW7KHHPEU\RVDUHXVXDOO\H[WUDVWKDWKDYHEHHQFUHDWHGLQ,9) LQ
YLWURIHUWLOL]DWLRQ FOLQLFVZKHUHVHYHUDOHJJVDUHIHUWLOL]HGLQDWHVWWXEHEXWRQO\RQHLVLPSODQWHG
LQWRDZRPDQ
6H[XDO UHSURGXFWLRQ EHJLQV ZKHQ D PDOH V VSHUP IHUWLOL]HV D IHPDOH V RYXP HJJ  WR IRUP D
VLQJOHFHOOFDOOHGD]\JRWH7KHVLQJOH]\JRWHFHOOWKHQEHJLQVDVHULHVRIGLYLVLRQVIRUPLQJ
FHOOV HWF $IWHUIRXU WRVL[ GD\V EHIRUH LPSODQWDWLRQ LQWKH XWHUXVWKLV PDVV RI FHOOV LV FDOOHG D
EODVWRF\VW 7KH EODVWRF\VW FRQVLVWV RI DQ LQQHU FHOO PDVV HPEU\REODVW  DQG DQ RXWHU FHOO PDVV
WURSKREODVW 7KHRXWHUFHOOPDVVEHFRPHVSDUWRIWKHSODFHQWDDQGWKHLQQHUFHOOPDVVLVWKHJURXS
RIFHOOVWKDWZLOOGLIIHUHQWLDWHWREHFRPHDOOWKHVWUXFWXUHVRIDQDGXOWRUJDQLVP7KLVODWWHUPDVVLVWKH
VRXUFHRIHPEU\RQLFVWHPFHOOVWRWLSRWHQWFHOOV FHOOVZLWKWRWDOSRWHQWLDOWRGHYHORSLQWRDQ\FHOOLQ
WKHERG\ 



)LJXUH+XPDQHPEU\RQLFVWHPFHOOFRORQ\

,QDQRUPDOSUHJQDQF\WKHEODVWRF\VWVWDJHFRQWLQXHVXQWLOLPSODQWDWLRQRIWKHHPEU\R
LQWKHXWHUXVDWZKLFKSRLQWWKHHPEU\RLVUHIHUUHGWRDVDIHWXV7KH\GRQRWFRQWULEXWHWRWKH
H[WUDHPEU\RQLFPHPEUDQHVRUWKHSODFHQWD7KLVXVXDOO\RFFXUVE\WKHHQGRIWKHWKZHHN
RIJHVWDWLRQDIWHUDOOPDMRURUJDQVRIWKHERG\KDYHEHHQFUHDWHG+RZHYHUZKHQH[WUDFWLQJ
HPEU\RQLFVWHPFHOOV WKH EODVWRF\VW VWDJH VLJQDOV ZKHQWRLVRODWHVWHPFHOOVE\SODFLQJ WKH
LQQHU FHOO PDVV RI WKH EODVWRF\VW LQWR D FXOWXUH GLVK FRQWDLQLQJ D QXWULHQWULFK EURWK
/DFNLQJ WKH QHFHVVDU\ VWLPXODWLRQ WR GLIIHUHQWLDWH WKH\ EHJLQ WR GLYLGH DQG UHSOLFDWH ZKLOH
PDLQWDLQLQJ WKHLU DELOLW\ WR EHFRPH DQ\ FHOO W\SH LQ WKH KXPDQ ERG\ (YHQWXDOO\ WKHVH
XQGLIIHUHQWLDWHGFHOOVFDQEHVWLPXODWHGWRFUHDWHVSHFLDOL]HGFHOOV

1HDUO\DOOUHVHDUFKWRGDWHKDVWDNHQSODFHXVLQJPRXVHHPEU\RQLFVWHPFHOOV P(6 RU
KXPDQ HPEU\RQLF VWHP FHOOV K(6  )LJXUH   %RWK KDYH WKH HVVHQWLDO VWHP FHOO
FKDUDFWHULVWLFV \HW WKH\ UHTXLUH YHU\ GLIIHUHQW HQYLURQPHQWV WR PDLQWDLQDQ XQGLIIHUHQWLDWHG
VWDWH0RXVH(6FHOOVDUHJURZQRQDOD\HURIJHODWLQDQGUHTXLUHWKHSUHVHQFHRI/HXNHPLD
,QKLELWRU\ )DFWRU /,)  +XPDQ (6 FHOOV DUH JURZQ RQ D IHHGHU OD\HU RI PRXVH HPEU\RQLF
ILEUREODVWV 0()V  DQG UHTXLUH WKH SUHVHQFH RI EDVLF )LEUREODVW *URZWK )DFWRU E)*) RU
)*)  :LWKRXW RSWLPDO FXOWXUH FRQGLWLRQV RU JHQHWLF PDQLSXODWLRQ HPEU\RQLF VWHP FHOOV
ZLOOUDSLGO\GLIIHUHQWLDWH

Ϯϰϯ

 
$KXPDQHPEU\RQLFVWHPFHOOLVDOVRGHILQHGE\WKHSUHVHQFHRIVHYHUDO WUDQVFULSWLRQ
IDFWRUVDQGFHOOVXUIDFHSURWHLQV7KHWUDQVFULSWLRQIDFWRUV2FW1DQRJDQG6R[IRUPWKH
FRUHUHJXODWRU\QHWZRUNWKDWHQVXUHVWKHVXSSUHVVLRQRIJHQHVWKDWOHDGWRGLIIHUHQWLDWLRQDQG
WKHPDLQWHQDQFHRISOXULSRWHQF\7KHFHOOVXUIDFHDQWLJHQVPRVWFRPPRQO\XVHGWRLGHQWLI\
K(6 FHOOV DUH WKH JO\FROLSLGV 66($ DQG 66($ DQGWKH NHUDWDQ VXOIDWH DQWLJHQV 7UD
DQG 7UD 7KH PROHFXODU GHILQLWLRQ RI D VWHP FHOO LQFOXGHV PDQ\ PRUH SURWHLQV DQG
FRQWLQXHVWREHDWRSLFRIUHVHDUFK

$IWHU QHDUO\ WHQ \HDUV RIUHVHDUFK WKHUH DUH QRDSSURYHGWUHDWPHQWV XVLQJ HPEU\RQLF
VWHP FHOOV 7KH ILUVW KXPDQ WULDO ZDV DSSURYHG E\ WKH 86 )RRG  'UXJ $GPLQLVWUDWLRQ LQ
-DQXDU\  (6 FHOOV EHLQJ SOXULSRWHQW FHOOV UHTXLUH VSHFLILF VLJQDOV IRU FRUUHFW
GLIIHUHQWLDWLRQLI LQMHFWHG GLUHFWO\ LQWR DQRWKHU ERG\ (6 FHOOV ZLOO GLIIHUHQWLDWH LQWR PDQ\
GLIIHUHQW W\SHV RI FHOOVFDXVLQJ D WHUDWRPD 'LIIHUHQWLDWLQJ (6 FHOOV LQWR XVDEOH FHOOV ZKLOH
DYRLGLQJ WUDQVSODQW UHMHFWLRQ DUH MXVW D IHZ RI WKH KXUGOHV WKDW HPEU\RQLF VWHP FHOO
UHVHDUFKHUVVWLOOIDFH0DQ\QDWLRQVFXUUHQWO\KDYHPRUDWRULDRQHLWKHU(6FHOOUHVHDUFKRUWKH
SURGXFWLRQRIQHZ(6FHOOOLQHV%HFDXVHRIWKHLUFRPELQHGDELOLWLHVRIXQOLPLWHGH[SDQVLRQ
DQG SOXULSRWHQF\ HPEU\RQLF VWHP FHOOV UHPDLQ D WKHRUHWLFDOO\ SRWHQWLDO VRXUFH IRU
UHJHQHUDWLYHPHGLFLQHDQGWLVVXHUHSODFHPHQWDIWHULQMXU\RUGLVHDVH

$GGLWLRQDOO\ XQGHU GHILQHG FRQGLWLRQV HPEU\RQLF VWHP FHOOV DUH FDSDEOH RI
SURSDJDWLQJ WKHPVHOYHVLQGHILQLWHO\ 7KLVDOORZVHPEU\RQLF VWHP FHOOV WR EH XVHG DV XVHIXO
WRROV IRU ERWK UHVHDUFK DQG UHJHQHUDWLYH PHGLFLQH EHFDXVH WKH\ FDQ SURGXFH OLPLWOHVV
QXPEHUVRIWKHPVHOYHVIRUFRQWLQXHGUHVHDUFKRUFOLQLFDOXVH

%HFDXVHRIWKHLUSODVWLFLW\DQGSRWHQWLDOO\ XQOLPLWHGFDSDFLW\IRUVHOIUHQHZDO(6FHOO
WKHUDSLHVKDYHEHHQSURSRVHGIRUUHJHQHUDWLYHPHGLFLQHDQGWLVVXHUHSODFHPHQWDIWHULQMXU\RU
GLVHDVH +RZHYHU 'LVHDVHV WUHDWHG E\ WKHVH QRQHPEU\RQLF VWHP FHOOV LQFOXGH D QXPEHU RI
EORRGDQGLPPXQHV\VWHPUHODWHGJHQHWLFGLVHDVHVFDQFHUVDQGGLVRUGHUVMXYHQLOHGLDEHWHV
3DUNLQVRQ VEOLQGQHVVDQGVSLQDOFRUGLQMXULHV

'LIIHUHQWLDWLRQRIHPEU\RQLFVWHPFHOOV

Ϯϰϰ

 

)LJXUH'LUHFWHGGLIIHUHQWLDWLRQRIPRXVHHPEU\RQLFVWHPFHOOV

6LQFHWKHHPEU\RQLFVWHPFHOOVLQFXOWXUHDUHJURZQXQGHUFHUWDLQFRQGLWLRQVWKH\FDQ
UHPDLQXQGLIIHUHQWLDWHG XQVSHFLDOL]HG %XWLIFHOOV DUHDOORZHG WRFOXPSWRJHWKHU WRIRUP
HPEU\RLG ERGLHV WKH\ EHJLQ WR GLIIHUHQWLDWH VSRQWDQHRXVO\ 7KH\ FDQ IRUP PXVFOH FHOOV
QHUYH FHOOV DQG PDQ\ RWKHU FHOO W\SHV $OWKRXJK VSRQWDQHRXV GLIIHUHQWLDWLRQ LV D JRRG
LQGLFDWLRQ WKDW D FXOWXUH RI HPEU\RQLF VWHP FHOOV LV KHDOWK\ LW LV QRW DQ HIILFLHQW ZD\ WR
SURGXFHFXOWXUHVRIVSHFLILFFHOOW\SHV

6R WR JHQHUDWH FXOWXUHV RI VSHFLILF W\SHV RI GLIIHUHQWLDWHG FHOOVKHDUW PXVFOH FHOOV
EORRG FHOOV RU QHUYH FHOOV IRU H[DPSOHVFLHQWLVWV WU\ WR FRQWURO WKH GLIIHUHQWLDWLRQ RI
HPEU\RQLFVWHPFHOOV7KH\FKDQJHWKHFKHPLFDOFRPSRVLWLRQRIWKHFXOWXUHPHGLXPDOWHUWKH
VXUIDFHRIWKHFXOWXUHGLVKRUPRGLI\WKHFHOOVE\LQVHUWLQJVSHFLILFJHQHV7KURXJK\HDUVRI
H[SHULPHQWDWLRQVFLHQWLVWVKDYHHVWDEOLVKHGVRPHEDVLFSURWRFROVRUUHFLSHVIRUWKHGLUHFWHG
GLIIHUHQWLDWLRQRIHPEU\RQLFVWHPFHOOVLQWRVRPHVSHFLILFFHOOW\SHV )LJXUH 

,VRODWLRQDQGLQYLWURFXOWXUH

,Q  UHVHDUFKHUV LVRODWHG D VLQJOH W\SH RI FHOO IURP D WHUDWRFDUFLQRPD D IRUP RI
FDQFHU WKDW UHSOLFDWHG DQG JUHZ LQ FHOO FXOWXUH DV D VWHP FHOO 6XEVHTXHQWO\ UHVHDUFKHUV
LVRODWHGDSULPRUGLDOHPEU\RQLFJHUPFHOO (*FHOO WKDWDIWHUUHSOLFDWLQJDQGJURZLQJLQFHOO
FXOWXUHDVDVWHPFHOOZDVFDSDEOHRIGHYHORSLQJLQWRGLIIHUHQWFHOOW\SHV

,Q  HPEU\RQLF VWHP FHOOV (6 FHOOV  ZHUH ILUVW GHULYHG IURP PRXVH HPEU\RV E\
0DUWLQ (YDQV DQG 0DWWKHZ .DXIPDQ DW WKH 'HSDUWPHQW RI *HQHWLFV 8QLYHUVLW\ RI
&DPEULGJH DQG LQGHSHQGHQWO\ E\ *DLO 5 0DUWLQ 0DUWLQ LV FUHGLWHG ZLWK FRLQLQJ WKH WHUP
(PEU\RQLF6WHP&HOO

Ϯϰϱ

 ,IVFLHQWLVWVFDQUHOLDEO\GLUHFWWKHGLIIHUHQWLDWLRQRIHPEU\RQLFVWHPFHOOVLQWRVSHFLILF
FHOOW\SHVWKH\PD\EHDEOHWRXVHWKHUHVXOWLQJGLIIHUHQWLDWHGFHOOVWRWUHDWFHUWDLQGLVHDVHV
DWVRPHSRLQWLQWKHIXWXUH'LVHDVHVWKDWPLJKWEHWUHDWHGE\WUDQVSODQWLQJFHOOVJHQHUDWHG
IURP KXPDQ HPEU\RQLF VWHP FHOOV LQFOXGH 3DUNLQVRQ V GLVHDVH GLDEHWHV WUDXPDWLF VSLQDO
FRUGLQMXU\ 3XUNLQMHFHOOGHJHQHUDWLRQ'XFKHQQH VPXVFXODUG\VWURSK\KHDUW GLVHDVH DQG
YLVLRQDQGKHDULQJORVV

&RQWDPLQDWLRQE\UHDJHQWVXVHGLQFHOOFXOWXUH

7KH RQOLQH HGLWLRQ RI 1DWXUH 0HGLFLQH SXEOLVKHG D VWXG\ RQ -DQXDU\   ZKLFK
VWDWHG WKDW WKH KXPDQ HPEU\RQLF VWHP FHOOV DYDLODEOH IRU IHGHUDOO\ IXQGHG UHVHDUFK DUH
FRQWDPLQDWHGZLWKQRQKXPDQPROHFXOHVIURPWKHFXOWXUHPHGLXPXVHGWRJURZWKHFHOOV,W
LVDFRPPRQWHFKQLTXHWRXVHPRXVHFHOOVDQGRWKHUDQLPDOFHOOVWRPDLQWDLQWKHSOXULSRWHQF\
RIDFWLYHO\GLYLGLQJVWHPFHOOV7KHSUREOHPZDVGLVFRYHUHGZKHQQRQKXPDQVLDOLFDFLGLQ
WKHJURZWKPHGLDZDVIRXQGWRFRPSURPLVHWKHSRWHQWLDOXVHVRIWKHHPEU\RQLFVWHPFHOOVLQ
KXPDQV

$IWHUPRUHWKDQPRQWKVRIXQGLIIHUHQWLDWHGSUROLIHUDWLRQWKHVHFHOOVGHPRQVWUDWHGWKH
SRWHQWLDO WR IRUP GHULYDWLYHV RI DOO WKUHH HPEU\RQLF JHUP OD\HUV ERWK LQ YLWUR DQG LQ
WHUDWRPDV 7KHVH SURSHUWLHV ZHUH DOVR VXFFHVVIXOO\ PDLQWDLQHG IRU PRUH WKDQ  SDVVDJHV 
ZLWKWKHHVWDEOLVKHGVWHPFHOOOLQHV

5HGXFLQJGRQRUKRVWUHMHFWLRQ

7KHUHLVDOVRRQJRLQJUHVHDUFKWRUHGXFHWKHSRWHQWLDOIRUUHMHFWLRQRIWKHGLIIHUHQWLDWHG
FHOOVGHULYHGIURP(6FHOOVRQFHUHVHDUFKHUVDUHFDSDEOHRIFUHDWLQJDQDSSURYHGWKHUDS\IURP
(6FHOOUHVHDUFK2QHRIWKHSRVVLELOLWLHVWRSUHYHQWUHMHFWLRQLV E\FUHDWLQJHPEU\RQLFVWHP
FHOOVWKDWDUHJHQHWLFDOO\LGHQWLFDOWRWKHSDWLHQWYLDWKHUDSHXWLFFORQLQJ

$QDOWHUQDWLYHVROXWLRQIRUUHMHFWLRQE\WKHSDWLHQWWRWKHUDSLHVGHULYHGIURPQRQFORQHG
(6 FHOOV LV WR GHULYH PDQ\ ZHOOFKDUDFWHUL]HG (6 FHOO OLQHV IURP GLIIHUHQW JHQHWLF
EDFNJURXQGV DQG XVH WKH FHOO OLQH WKDW LV PRVW VLPLODUWR WKH SDWLHQW WUHDWPHQW FDQ WKHQ EH
WDLORUHGWRWKHSDWLHQWPLQLPL]LQJWKHULVNRIUHMHFWLRQ

7KHUDSHXWLFDSSOLFDWLRQ

2Q-DQXDU\3KDVH,FOLQLFDOWULDOVIRUWUDQVSODQWDWLRQRIDKXPDQ(6GHULYHG
FHOO SRSXODWLRQ LQWR VSLQDO FRUG LQMXUHG LQGLYLGXDOV UHFHLYHG DSSURYDO IURP WKH86 )RRG 
'UXJ $GPLQLVWUDWLRQ )'$  PDUNLQJ LW WKH ZRUOG V ILUVW KXPDQ (6 FHOO KXPDQ WULDO 7KH
VWXG\OHDGLQJWRWKLVVFLHQWLILFDGYDQFHPHQWZDVFRQGXFWHGE\+DQV.HLUVWHDGDQGFROOHDJXHV
DWWKH8QLYHUVLW\RI&DOLIRUQLD7KHUHVXOWVRI WKLVH[SHULPHQWVXJJHVWHGDQLPSURYHPHQWLQ
ORFRPRWRUUHFRYHU\LQVSLQDOFRUGLQMXUHGUDWVDIWHUDGD\GHOD\HGWUDQVSODQWDWLRQRIKXPDQ
(6FHOOVWKDWZHUHSXVKHGWRZDUGVDQROLJRGHQGURF\WLFOLQHDJH

8VHRIKXPDQHPEU\RQLFVWHPFHOOVDVPRGHOVIRUKXPDQJHQHWLFGLVRUGHUV

,Q UHFHQW \HDUV WKHUH KDYH EHHQ VHYHUDO UHSRUWV UHJDUGLQJ WKH SRWHQWLDO XVH RI KXPDQ
HPEU\RQLFVWHPFHOOVDVPRGHOVIRUKXPDQJHQHWLFGLVHDVHV7KLVLVVXHLVHVSHFLDOO\LPSRUWDQW
GXH WR WKH VSHFLHVVSHFLILF QDWXUH RI PDQ\ JHQHWLF GLVRUGHUV 7KH UHODWLYH LQDFFHVVLELOLW\ RI

Ϯϰϲ

KXPDQ SULPDU\ WLVVXH IRU UHVHDUFK LV DQRWKHU PDMRU KLQGUDQFH 6HYHUDO QHZ VWXGLHV KDYH
VWDUWHGWRDGGUHVVWKLVLVVXH7KLVKDVEHHQGRQHHLWKHUE\JHQHWLFDOO\PDQLSXODWLQJWKHFHOOV
RU PRUH UHFHQWO\ E\ GHULYLQJ GLVHDVHG FHOO OLQHV LGHQWLILHG E\ SUHQDWDO JHQHWLF GLDJQRVLV
3*' 7KLVDSSURDFKPD\YHU\ZHOOSURYHLQYDOXDEOHDWVWXG\LQJGLVRUGHUVVXFKDV)UDJLOH
;V\QGURPH&\VWLFILEURVLVDQGRWKHUJHQHWLFPDODGLHVWKDWKDYHQRUHOLDEOHPRGHOV\VWHP

7KH WHFKQLTXHV RI SUHQDWDO GLDJQRVLV WHVWLQJ PHWKRGV WR GHWHUPLQH JHQHWLF DQG
FKURPRVRPDO GLVRUGHUV DUH QRZ XVHG E\ PDQ\ SUHJQDQW ZRPHQ DQG SURVSHFWLYH SDUHQWV
HVSHFLDOO\WKRVHFRXSOHVZLWKDKLVWRU\RIJHQHWLFDEQRUPDOLWLHVRUZKHUHWKHZRPDQLVRYHU
WKHDJHRIZKHQWKHULVNRIJHQHWLFDOO\UHODWHGGLVRUGHUVLVKLJKHU,QDGGLWLRQE\DOORZLQJ
SDUHQWVWRVHOHFWDQHPEU\RZLWKRXW JHQHWLFGLVRUGHUVWKH\KDYHWKHSRWHQWLDORIVDYLQJWKH
OLYHVRIVLEOLQJVWKDWDOUHDG\KDGVLPLODUGLVRUGHUVDQGGLVHDVHVXVLQJFHOOVIURPWKHGLVHDVH
IUHHRIIVSULQJ

(PEU\RQLFVWHPFHOOWULDODSSURYHGE\WKH)'$

,QWKHVXPPHURIWKHILUVWFOLQLFDOWULDOXVLQJHPEU\RQLFVWHPFHOOVLQKXPDQVZDV
DSSURYHG E\ WKH 86 )RRG  'UXJ $GPLQLVWUDWLRQ )'$  $ ELRWHFK FRPSDQ\ FDOOHG WKH
*HURQ&RUSRUDWLRQZLOOEHFRQGXFWLQJWKHWULDO7KHVWXG\ZLOOLQYROYHWKHLQMHFWLRQRIQHXUDO
VWHPFHOOVLQWRSDUDSOHJLFVZKRKDYHVXIIHUHGDUHFHQWVSLQDOFRUGLQMXU\$ERXWHLJKWWRWHQ
SDUDSOHJLFVZKRKDYHKDGWKHLULQMXULHVQRORQJHUWKDQWZRZHHNVEHIRUHWKHWULDOEHJLQVZLOO
EHVHOHFWHGWRWDNHSDUWLQWKHWULDOEHFDXVHWKHFHOOVPXVWEHLQMHFWHGEHIRUHVFDUWLVVXHLVDEOH
WR IRUP +RZHYHU WKH UHVHDUFKHUV DUH HPSKDVL]LQJ WKDW WKH LQMHFWLRQV DUH QRW H[SHFWHG WR
IXOO\ FXUH WKH SDWLHQWV DQG UHVWRUH DOO PRELOLW\ %DVHG RQ WKH UHVXOWV RI WKH PLFH WULDOV
UHVHDUFKHUVVD\UHVWRUDWLRQRIP\HOLQVKHDWKHVDQGDQLQFUHDVHLQPRELOLW\LVSUREDEOH7KLV
ILUVWWULDOLVPDLQO\WHVWLQJWKHVDIHW\RIWKHVHSURFHGXUHVDQGLIHYHU\WKLQJJRHVZHOOLWFRXOG
OHDGWRIXWXUHVWXGLHVWKDWLQYROYHSHRSOHZLWKPRUHVHYHUHGLVDELOLWLHV

)HWDOVWHPFHOOV

)HWDO VWHP FHOOV DUH SULPLWLYH FHOO W\SHV IRXQG LQ WKH RUJDQV RI IHWXVHV >@ 7KH
FODVVLILFDWLRQRIIHWDOVWHPFHOOVUHPDLQVXQFOHDUDQGWKLVW\SHRIVWHPFHOOLVFXUUHQWO\RIWHQ
JURXSHGLQWRDQDGXOWVWHPFHOO+RZHYHUDPRUHFOHDUGLVWLQFWLRQEHWZHHQWKHWZRFHOOW\SHV
DSSHDUVQHFHVVDU\

$GXOW6WHP&HOOV
$GXOW RU VRPDWLF VWHP FHOOV H[LVW WKURXJKRXW WKH ERG\ DIWHU HPEU\RQLF GHYHORSPHQW
DQGDUHIRXQGLQVLGHRIGLIIHUHQWW\SHVRIWLVVXH7KHVHVWHPFHOOVKDYHEHHQIRXQGLQWLVVXHV
VXFKDVWKHEUDLQERQHPDUURZEORRGEORRGYHVVHOVVNHOHWDOPXVFOHVVNLQDQGWKHOLYHU
7KH\UHPDLQLQDTXLHVFHQWRUQRQGLYLGLQJVWDWHIRU\HDUVXQWLODFWLYDWHGE\GLVHDVHRUWLVVXH
LQMXU\ $GXOW VWHPFHOOV FDQ GLYLGH RU VHOIUHQHZ LQGHILQLWHO\ HQDEOLQJ WKHP WR JHQHUDWH D
UDQJHRIFHOOW\SHVIURPWKHRULJLQDWLQJRUJDQRUHYHQUHJHQHUDWHVWKHHQWLUHRULJLQDORUJDQ,W
LVJHQHUDOO\WKRXJKWWKDWDGXOWVWHPFHOOVDUHOLPLWHGLQWKHLUDELOLW\WRGLIIHUHQWLDWHEDVHGRQ
WKHLU WLVVXH RI RULJLQ EXW WKHUH LV VRPH HYLGHQFH WR VXJJHVW WKDW WKH\ FDQ GLIIHUHQWLDWH WR
EHFRPHRWKHUFHOOW\SHV

3OXULSRWHQWDGXOWVWHPFHOOVDUHUDUHDQGJHQHUDOO\VPDOOLQQXPEHUEXWFDQEHIRXQGLQ
DQXPEHURIWLVVXHVLQFOXGLQJXPELOLFDOFRUGEORRG$JUHDWGHDORIDGXOWVWHPFHOOUHVHDUFK
KDV IRFXVHG RQ FODULI\LQJ WKHLU FDSDFLW\ WR GLYLGH RU VHOIUHQHZ LQGHILQLWHO\ DQG WKHLU

Ϯϰϳ

GLIIHUHQWLDWLRQ SRWHQWLDO ,Q PLFH SOXULSRWHQW VWHP FHOOV DUH GLUHFWO\ JHQHUDWHG IURP DGXOW
ILEUREODVW FXOWXUHV 8QIRUWXQDWHO\ PDQ\ PLFH GRQ W OLYH ORQJ ZLWK VWHP FHOO RUJDQV 0RVW
DGXOW VWHP FHOOV DUH OLQHDJHUHVWULFWHG PXOWLSRWHQW  DQG DUH JHQHUDOO\ UHIHUUHG WR E\ WKHLU
WLVVXHRULJLQ

$GXOWVWHPFHOOWUHDWPHQWVKDYHEHHQVXFFHVVIXOO\XVHGIRUPDQ\\HDUVWRWUHDWOHXNHPLD
DQG UHODWHG ERQHEORRGFDQFHUV WKURXJK ERQH PDUURZ WUDQVSODQWV $GXOW VWHP FHOOV DUH DOVR
XVHGLQYHWHULQDU\PHGLFLQHWRWUHDWWHQGRQDQGOLJDPHQWLQMXULHVLQKRUVHV

7KHXVHRIDGXOWVWHPFHOOVLQUHVHDUFKDQGWKHUDS\LVQRWDVFRQWURYHUVLDODVHPEU\RQLF
VWHPFHOOVEHFDXVHWKHSURGXFWLRQRIDGXOWVWHPFHOOVGRHVQRWUHTXLUHWKHGHVWUXFWLRQRIDQ
HPEU\R $GGLWLRQDOO\ EHFDXVH LQ VRPH LQVWDQFHV DGXOW VWHP FHOOVFDQ EH REWDLQHGIURP WKH
LQWHQGHG UHFLSLHQW DQ DXWRJUDIW  WKH ULVN RI UHMHFWLRQ LV HVVHQWLDOO\ QRQH[LVWHQW LQ WKHVH
VLWXDWLRQV&RQVHTXHQWO\PRUH86JRYHUQPHQWIXQGLQJLVEHLQJSURYLGHGIRUDGXOWVWHPFHOO
UHVHDUFK

6RXUFHV

3OXULSRWHQWVWHPFHOOVLHFHOOVWKDWFDQJLYHULVHWRDQ\IHWDORUDGXOWFHOOW\SHFDQEH
IRXQGLQDQXPEHURIWLVVXHVLQFOXGLQJXPELOLFDOFRUGEORRG8VLQJJHQHWLFUHSURJUDPPLQJ
SOXULSRWHQW VWHP FHOOV HTXLYDOHQW WR HPEU\RQLF VWHP FHOOV KDYH EHHQ GHULYHG IURP KXPDQ
DGXOW VNLQ WLVVXH 2WKHU DGXOW VWHP FHOOV DUH PXOWLSRWHQW PHDQLQJ WKH\ DUH UHVWULFWHG LQ WKH
W\SHV RI FHOO WKH\ FDQ EHFRPH DQG DUH JHQHUDOO\ UHIHUUHG WR E\ WKHLU WLVVXH RULJLQ VXFK DV
PHVHQFK\PDOVWHPFHOODGLSRVHGHULYHGVWHPFHOOHQGRWKHOLDOVWHPFHOOHWF $JUHDWGHDORI
DGXOW VWHP FHOO UHVHDUFK KDV IRFXVHG RQ LQYHVWLJDWLQJ WKHLU FDSDFLW\ WR GLYLGH RU VHOIUHQHZ
LQGHILQLWHO\ DQG WKHLU SRWHQWLDO IRU GLIIHUHQWLDWLRQ ,Q PLFH SOXULSRWHQW VWHP FHOOV FDQ EH
GLUHFWO\JHQHUDWHGIURPDGXOWILEUREODVWFXOWXUHV

$PQLRWLF

0XOWLSRWHQW VWHP FHOOV DUH DOVR IRXQG LQ DPQLRWLF IOXLG 7KHVH VWHP FHOOV DUH YHU\
DFWLYHH[SDQGH[WHQVLYHO\ZLWKRXWIHHGHUVDQGDUHQRWWXPRURJHQLF$PQLRWLFVWHPFHOOVDUH
PXOWLSRWHQW DQG FDQ GLIIHUHQWLDWH LQ FHOOV RI DGLSRJHQLF RVWHRJHQLF P\RJHQLF HQGRWKHOLDO
KHSDWLFDQGQHXURQDOOLQHV

,QGXFHG3OHXULSRWHQW

7KHVHDUHQRWDGXOWVWHPFHOOVEXWUDWKHUUHSURJUDPPHGFHOOV HJHSLWKHOLDOFHOOV JLYHQ
SOXULSRWHQW FDSDELOLWLHV 8VLQJ JHQHWLF UHSURJUDPPLQJ ZLWK SURWHLQ WUDQVFULSWLRQ IDFWRUV
SOXULSRWHQW VWHP FHOOV HTXLYDOHQW WR HPEU\RQLF VWHP FHOOV KDYH EHHQ GHULYHG IURP KXPDQ
DGXOWVNLQWLVVXH6KLQ\D<DPDQDNDDQGKLVFROOHDJXHVXVHGWKHWUDQVFULSWLRQIDFWRUV2FW
6R[F0\FDQG.OILQWKHLUH[SHULPHQWVRQFHOOVIURPKXPDQIDFHV-XQ\LQJ<XDQGWKHLU
FROOHDJXHVXVHGDGLIIHUHQWVHWRIIDFWRUV2FW6R[1DQRJDQG/LQDQGFDUULHGRXWWKHLU
H[SHULPHQWVXVLQJFHOOVIURPKXPDQIRUHVNLQ

$VDUHVXOWRIWKHVXFFHVVRIWKHVHH[SHULPHQWV,DQ:LOPXWZKRKHOSHGFUHDWHWKHILUVW
FORQHG DQLPDO 'ROO\ KDV DQQRXQFHG WKDW KH ZLOO DEDQGRQ QXFOHDU WUDQVIHU DV DQ DYHQXH RI
UHVHDUFK

6LJQDOLQJSDWKZD\V

Ϯϰϴ

 
$GXOW VWHP FHOO UHVHDUFK KDV EHHQ IRFXVHG RQ XQFRYHULQJ WKH JHQHUDO PROHFXODU
PHFKDQLVPVWKDWFRQWUROWKHLUVHOIUHQHZDODQGGLIIHUHQWLDWLRQ

%PL
7KH7UDQVFULSWLRQDOUHSUHVVRU%PLVLV RQHRIWKH 3RO\FRPEJURXS SURWHLQV WKDW ZDV
GLVFRYHUHG DV D FRPPRQ RQFRJHQH DFWLYDWHG LQ O\PSKRPD DQG ODWHU VKRZQ WR VSHFLILFDOO\
UHJXODWH+6&V7KHUROHRI%PLKDVDOVREHHQLOOXVWUDWHGLQQHXUDOVWHPFHOOV

1RWFK
7KH1RWFKSDWKZD\KDVEHHQNQRZQWRGHYHORSPHQWDOELRORJLVWVIRUGHFDGHV,WVUROHLQ
FRQWURORIVWHPFHOOSUROLIHUDWLRQKDVQRZEHHQGHPRQVWUDWHGIRUVHYHUDOFHOOW\SHVLQFOXGLQJ
KDHPDWRSRLHWLFQHXUDODQGPDPPDU\VWHPFHOOV

:QW
7KHVHGHYHORSPHQWDOSDWKZD\VDUHDOVRVWURQJO\LPSOLFDWHGDVVWHPFHOOUHJXODWRUV


/LQHDJH

7R HQVXUH VHOIUHQHZDO VWHP FHOOV XQGHUJR WZR W\SHV RI FHOO GLYLVLRQ 6\PPHWULF
GLYLVLRQ JLYHV ULVH WR WZR LGHQWLFDO GDXJKWHU FHOOV ERWK HQGRZHG ZLWK VWHP FHOO SURSHUWLHV
$V\PPHWULF GLYLVLRQ &RQYHUVHO\ SURGXFHV RQO\ RQH VWHP FHOO DQG D SURJHQLWRU FHOO ZLWK
OLPLWHG VHOIUHQHZDO SRWHQWLDO 3URJHQLWRUV FDQ JR WKURXJK VHYHUDO URXQGV RI FHOO GLYLVLRQ
EHIRUHWHUPLQDOO\GLIIHUHQWLDWLQJLQWRDPDWXUHFHOO,WLVSRVVLEOHWKDWWKHPROHFXODUGLVWLQFWLRQ
EHWZHHQ V\PPHWULF DQG DV\PPHWULF GLYLVLRQV OLHV LQ GLIIHUHQWLDO VHJUHJDWLRQ RI FHOO
PHPEUDQHSURWHLQV VXFKDVUHFHSWRUV EHWZHHQWKHGDXJKWHUFHOOV

$Q DOWHUQDWLYH WKHRU\ LV WKDW VWHP FHOOV UHPDLQ XQGLIIHUHQWLDWHG GXH WR HQYLURQPHQWDO
FXHVLQWKHLUSDUWLFXODUQLFKH6WHPFHOOVGLIIHUHQWLDWHZKHQWKH\OHDYHWKDWQLFKHRUQRORQJHU
UHFHLYHWKRVH VLJQDOV6WXGLHV LQ 'URVRSKLODJHUPDULXPKDYHLGHQWLILHGWKHVLJQDOVGSSDQG
DGKHUHQVMXQFWLRQVWKDWSUHYHQWJHUPDULXPVWHPFHOOVIURPGLIIHUHQWLDWLQJ

7KH VLJQDOV WKDW OHDG WR UHSURJUDPPLQJ RI FHOOV WR DQ HPEU\RQLFOLNH VWDWH DUH DOVR
EHLQJLQYHVWLJDWHG7KHVHVLJQDOSDWKZD\VLQFOXGHVHYHUDOWUDQVFULSWLRQIDFWRUVLQFOXGLQJWKH
RQFRJHQHF0\F,QLWLDOVWXGLHVLQGLFDWHWKDWWUDQVIRUPDWLRQRIPLFHFHOOVZLWKDFRPELQDWLRQ
RI WKHVH DQWLGLIIHUHQWLDWLRQ VLJQDOV FDQ UHYHUVH GLIIHUHQWLDWLRQDQG PD\ DOORZ DGXOW FHOOV WR
EHFRPH SOXULSRWHQW +RZHYHU WKH QHHG WR WUDQVIRUP WKHVH FHOOV ZLWK DQ RQFRJHQH PD\
SUHYHQWWKHXVHRIWKLVDSSURDFKLQWKHUDS\

0XOWLGUXJUHVLVWDQFH
$GXOWVWHP FHOOVH[SUHVV WUDQVSRUWHUV RI WKH $73ELQGLQJFDVVHWWHIDPLO\WKDWDFWLYHO\
SXPSDGLYHUVLW\RIRUJDQLFPROHFXOHVRXWRIWKHFHOO0DQ\SKDUPDFHXWLFDOVDUHH[SRUWHGE\
WKHVHWUDQVSRUWHUVFRQIHUULQJPXOWLGUXJUHVLVWDQFHRQWRWKHFHOO7KLVFRPSOLFDWHVWKHGHVLJQ
RI GUXJV IRU LQVWDQFH QHXUDO VWHP FHOO WDUJHWHG WKHUDSLHV IRU WKH WUHDWPHQW RI FOLQLFDO
GHSUHVVLRQ


3ODVWLFLW\


Ϯϰϵ

 8QGHUVSHFLDOFRQGLWLRQVWLVVXHVSHFLILFDGXOWVWHPFHOOVFDQJHQHUDWHDZKROHVSHFWUXP
RIFHOOW\SHVRIRWKHUWLVVXHVHYHQFURVVLQJJHUPOD\HUV 7KLV SKHQRPHQRQLVUHIHUUHGWRDV
VWHPFHOOWUDQVGLIIHUHQWLDWLRQRUSODVWLFLW\,WFDQEHLQGXFHGE\PRGLI\LQJWKHJURZWKPHGLXP
ZKHQVWHPFHOOVDUHFXOWXUHGLQYLWURRUWUDQVSODQWLQJWKHPWRDQRUJDQRIWKHERG\GLIIHUHQW
IURPWKHRQHWKH\ZHUHRULJLQDOO\LVRODWHGIURP7KHUHLV\HWQRFRQVHQVXVDPRQJELRORJLVWV
RQWKHSUHYDOHQFHDQGSK\VLRORJLFDODQGWKHUDSHXWLFUHOHYDQFHRIVWHPFHOOSODVWLFLW\ )LJXUH
 



)LJXUH3ODVWLFLW\RIDGXOWVWHPFHOOV


7\SHVRIDGXOWVWHPFHOOV



)LJXUH+HPDWRSRLHWLFDQGVWURPDOVWHPFHOOGLIIHUHQWLDWLRQ

ϮϱϬ

 $GXOW VWHP FHOOV PD\ DOVR H[KLELW WKH DELOLW\ WR IRUP VSHFLDOL]HG FHOO W\SHV RI RWKHU WLVVXHV
ZKLFKLVNQRZQDVWUDQVGLIIHUHQWLDWLRQRUSODVWLFLW\

,QDOLYLQJDQLPDODGXOWVWHPFHOOVFDQGLYLGHIRUDORQJSHULRGDQGFDQJLYHULVHWRPDWXUHFHOO
W\SHVWKDWKDYHFKDUDFWHULVWLFVKDSHV DQGVSHFLDOL]HG VWUXFWXUHVDQGIXQFWLRQVRIDSDUWLFXODUWLVVXH
7KHIROORZLQJDUHH[DPSOHVRIGLIIHUHQWLDWLRQSDWKZD\VRIDGXOWVWHPFHOOV )LJXUH 

+DHPDWRSRLHWLFVWHPFHOOV

+DHPDWRSRLHWLFVWHPFHOOVDUHIRXQGLQWKHERQHPDUURZDQGJLYHULVHWRDOOWKHEORRG
FHOOW\SHV

0DPPDU\VWHPFHOOV

0DPPDU\ VWHP FHOOV SURYLGH WKH VRXUFH RI FHOOV IRU JURZWK RI WKH PDPPDU\ JODQG
GXULQJ SXEHUW\ DQG JHVWDWLRQ DQG SOD\ DQ LPSRUWDQW UROH LQ FDUFLQRJHQHVLV RI WKH EUHDVW
0DPPDU\VWHPFHOOVKDYHEHHQLVRODWHGIURPKXPDQDQGPRXVHWLVVXHDVZHOODVIURPFHOO
OLQHV GHULYHG IURP WKH PDPPDU\ JODQG 6LQJOH VXFK FHOOVFDQ JLYH ULVH WR ERWK WKH OXPLQDO
DQG P\RHSLWKHOLDO FHOO W\SHV RI WKH JODQG DQG KDYH EHHQ VKRZQ WR KDYH WKH DELOLW\ WR
UHJHQHUDWHWKHHQWLUHRUJDQLQPLFH

0HVHQFK\PDOVWHPFHOOV

0HVHQFK\PDO VWHP FHOOV 06&V  DUH RI VWURPDO RULJLQ DQG PD\ GLIIHUHQWLDWH LQWR D
YDULHW\RIWLVVXHV06&VKDYHEHHQLVRODWHGIURPSODFHQWDDGLSRVHWLVVXHOXQJERQHPDUURZ
DQG EORRG :KDUWRQ V MHOO\ IURP WKH XPELOLFDO FRUG DQG WHHWK SHULYDVFXODU QLFKH RI GHQWDO
SXOSDQGSHULRGRQWDOOLJDPHQW 06&VDUHDWWUDFWLYHIRUFOLQLFDOWKHUDS\GXHWRWKHLUDELOLW\WR
GLIIHUHQWLDWHSURYLGHWURSKLFVXSSRUWDQGPRGXODWHLQQDWHLPPXQHUHVSRQVH

1HXUDOVWHPFHOOV

7KH H[LVWHQFH RI VWHP FHOOV LQ WKH DGXOW EUDLQ KDV EHHQ SRVWXODWHG IROORZLQJ WKH
GLVFRYHU\WKDWWKHSURFHVVRIQHXURJHQHVLVWKHELUWKRIQHZQHXURQVFRQWLQXHVLQWRDGXOWKRRG
LQUDWV7KHSUHVHQFHRIVWHPFHOOVLQWKHPDWXUHSULPDWHEUDLQZDVILUVWUHSRUWHGLQ,W
KDVVLQFHEHHQVKRZQWKDWQHZQHXURQVDUHJHQHUDWHGLQDGXOWPLFHVRQJELUGVDQGSULPDWHV
LQFOXGLQJKXPDQV1RUPDOO\DGXOW QHXURJHQHVLVLVUHVWULFWHGWRWZRDUHDVRIWKHEUDLQWKH
VXEYHQWULFXODU ]RQH ZKLFK OLQHV WKH ODWHUDO YHQWULFOHV DQG WKH GHQWDWH J\UXV RI WKH
KLSSRFDPSDOIRUPDWLRQ$OWKRXJKWKHJHQHUDWLRQRIQHZQHXURQVLQWKHKLSSRFDPSXVLVZHOO
HVWDEOLVKHG WKH SUHVHQFH RI WUXH VHOIUHQHZLQJ VWHP FHOOV WKHUH KDV EHHQ GHEDWHG 8QGHU
FHUWDLQ FLUFXPVWDQFHV VXFK DV IROORZLQJ WLVVXH GDPDJH LQ LVFKHPLD QHXURJHQHVLV FDQ EH
LQGXFHGLQRWKHUEUDLQUHJLRQVLQFOXGLQJWKHQHRFRUWH[

1HXUDOVWHPFHOOVDUHFRPPRQO\FXOWXUHG LQYLWUR DV VRFDOOHG QHXURVSKHUHV IORDWLQJ
KHWHURJHQHRXVDJJUHJDWHVRIFHOOVFRQWDLQLQJDODUJH SURSRUWLRQ RI VWHPFHOOV 7KH\FDQ EH
SURSDJDWHGIRUH[WHQGHGSHULRGVRIWLPHDQGGLIIHUHQWLDWHGLQWRERWKQHXURQDODQGJOLDVFHOOV
DQGWKHUHIRUHEHKDYHDVVWHPFHOOV+RZHYHUVRPHUHFHQWVWXGLHVVXJJHVWWKDWWKLVEHKDYLRXU
LVLQGXFHGE\WKHFXOWXUHFRQGLWLRQVLQSURJHQLWRUFHOOVWKHSURJHQ\RIVWHPFHOOGLYLVLRQWKDW
QRUPDOO\ XQGHUJR D VWULFWO\ OLPLWHG QXPEHU RI UHSOLFDWLRQ F\FOHV LQ YLYR )XUWKHUPRUH
QHXURVSKHUHGHULYHGFHOOVGRQRWEHKDYHDVVWHPFHOOVZKHQWUDQVSODQWHGEDFNLQWRWKHEUDLQ

Ϯϱϭ

 
1HXUDO VWHP FHOOV VKDUH PDQ\ SURSHUWLHV ZLWK KDHPDWRSRLHWLF VWHP FHOOV +6&V 
5HPDUNDEO\ ZKHQ LQMHFWHG LQWR WKH EORRG QHXURVSKHUHGHULYHG FHOOV GLIIHUHQWLDWH LQWR
YDULRXVFHOOW\SHVRIWKHLPPXQHV\VWHP

2OIDFWRU\DGXOWVWHPFHOOV

2OIDFWRU\DGXOWVWHPFHOOVKDYHEHHQVXFFHVVIXOO\KDUYHVWHGIURPWKHKXPDQROIDFWRU\
PXFRVDFHOOVZKLFKDUHIRXQGLQWKHOLQLQJRIWKHQRVHDQGDUHLQYROYHGLQWKHVHQVHRIVPHOO
,I WKH\ DUH JLYHQ WKH ULJKW FKHPLFDO HQYLURQPHQW WKHVH FHOOV KDYH WKH VDPH DELOLW\ DV
HPEU\RQLFVWHPFHOOVWRGHYHORSLQWRPDQ\GLIIHUHQWFHOOW\SHV2OIDFWRU\VWHPFHOOVKROGWKH
SRWHQWLDO IRUWKHUDSHXWLFDSSOLFDWLRQVDQG LQFRQWUDVW WR QHXUDO VWHP FHOOV FDQ EH KDUYHVWHG
ZLWK HDVH ZLWKRXW KDUP WR WKH SDWLHQW 7KLV PHDQV WKH\ FDQ EH HDVLO\ REWDLQHG IURP DOO
LQGLYLGXDOVLQFOXGLQJROGHUSDWLHQWVZKRPLJKWEHPRVWLQQHHGRIVWHPFHOOWKHUDSLHV

1HXUDOFUHVWVWHPFHOOV

+DLU IROOLFOHV FRQWDLQ WZR W\SHV RI VWHP FHOOV RQH RI ZKLFK DSSHDUV WR UHSUHVHQW D
UHPQDQWRIWKHVWHPFHOOVRIWKHHPEU\RQLFQHXUDOFUHVW6LPLODUFHOOVKDYHEHHQIRXQGLQWKH
JDVWURLQWHVWLQDOWUDFW6FLDWLFQHUYHFDUGLDFRXWIORZWUDFWDQGVSLQDODQGV\PSDWKHWLFJDQJOLD
7KHVH FHOOV FDQ JHQHUDWH QHXURQV 6FKZDQQ FHOOV P\RILEUREODVW FKRQGURF\WHV DQG
PHODQRF\WHV

7HVWLFXODUFHOOV
0XOWLSRWHQWVWHPFHOOV ZLWKDFODLPHG HTXLYDOHQF\WRHPEU\RQLFVWHPFHOOVKDYHEHHQ
GHULYHG IURP VSHUPDWRJRQLDO SURJHQLWRU FHOOV IRXQG LQ WKH WHVWLFOHV RI ODERUDWRU\ PLFH E\
VFLHQWLVWVLQ*HUPDQ\DQGWKH8QLWHG6WDWHVDQGD\HDUODWHUUHVHDUFKHUVIURP*HUPDQ\DQG
WKH8QLWHG.LQJGRPFRQILUPHGWKHVDPHFDSDELOLW\XVLQJFHOOVIURPWKHWHVWLFOHVRIKXPDQV
7KHH[WUDFWHGVWHPFHOOVDUHNQRZQDVKXPDQDGXOWJHUPOLQHVWHPFHOOV *6&V 0XOWLSRWHQW
VWHPFHOOVKDYHDOVREHHQGHULYHGIURPJHUPFHOOVIRXQGLQKXPDQWHVWLFOHV

$GXOWVWHPFHOOWKHUDSLHV

7KH WKHUDSHXWLF SRWHQWLDO RI DGXOW VWHP FHOOV LV WKH IRFXV RI PXFK VFLHQWLILF UHVHDUFK
GXHWRWKHLUDELOLW\WREHKDUYHVWHGIURPWKHSDWLHQW,QFRPPRQZLWKHPEU\RQLFVWHPFHOOV
DGXOWVWHPFHOOVKDYHWKHDELOLW\WRGLIIHUHQWLDWHLQWRPRUHWKDQRQHFHOOW\SHEXWXQOLNHWKH
IRUPHUWKH\DUHRIWHQUHVWULFWHGWRFHUWDLQW\SHVRUOLQHDJHV7KHDELOLW\RIDGLIIHUHQWLDWHG
VWHPFHOORIRQHOLQHDJHWRSURGXFHFHOOVRIDGLIIHUHQWOLQHDJHLVFDOOHGWUDQVGLIIHUHQWLDWLRQ
6RPHW\SHVRIDGXOWVWHP FHOOV DUHPRUHFDSDEOHRI WUDQVGLIIHUHQWLDWLRQWKDQRWKHUVDQGIRU
PDQ\ WKHUH LV QRHYLGHQFH WKDWVXFKDWUDQVIRUPDWLRQ LV SRVVLEOH &RQVHTXHQWO\ DGXOW VWHP
WKHUDSLHV UHTXLUH D VWHP FHOO VRXUFH RI WKH VSHFLILF OLQHDJH QHHGHG DQG KDUYHVWLQJ DQGRU
FXOWXULQJWKHPXSWRWKHQXPEHUVUHTXLUHGLVDFKDOOHQJH


&OLQLFDO$SSOLFDWLRQV

$GXOWVWHPFHOOWUHDWPHQWVKDYHEHHQXVHGIRUPDQ\\HDUVWRVXFFHVVIXOO\WUHDWOHXNHPLD
DQGUHODWHGERQHEORRGFDQFHUVXWLOL]LQJERQHPDUURZWUDQVSODQWV7KHXVHRIDGXOWVWHPFHOOV
LQUHVHDUFKDQGWKHUDS\LVQRWFRQVLGHUHGDVFRQWURYHUVLDODVWKHXVHRIHPEU\RQLFVWHPFHOOV
EHFDXVH WKH SURGXFWLRQ RI DGXOW VWHP FHOOV GRHV QRW UHTXLUH WKH GHVWUXFWLRQ RI DQ HPEU\R

ϮϱϮ

&RQVHTXHQWO\WKHPDMRULW\RI86JRYHUQPHQWIXQGLQJSURYLGHGIRUUHVHDUFKLQWKLVILHOGLV
UHVWULFWHGWRVXSSRUWLQJDGXOWVWHPFHOOUHVHDUFK

(DUO\UHJHQHUDWLYHDSSOLFDWLRQVRIDGXOWVWHPFHOOVKDYHIRFXVHGRQLQWUDYHQRXVGHOLYHU\
RI EORRG SURJHQLWRUV NQRZQ DV +HPDWRSHWLF 6WHP &HOOV +6& V  2WKHU HDUO\ FRPPHUFLDO
DSSOLFDWLRQV KDYH IRFXVHG RQ 0HVHQFK\PDO 6WHP &HOOV 06& V  )RU ERWK FHOO OLQHV GLUHFW
LQMHFWLRQRUSODFHPHQW RIFHOOV LQWR D VLWH LQ QHHG RIUHSDLUPD\EHWKHSUHIHUUHGPHWKRGRI
WUHDWPHQWDVYDVFXODUGHOLYHU\VXIIHUVIURPDSXOPRQDU\ILUVWSDVVHIIHFWZKHUHLQWUDYHQRXV
LQMHFWHG FHOOV DUH VHTXHVWHUHG LQ WKH OXQJV &OLQLFDO FDVH UHSRUWV LQ RUWKRSHGLF DSSOLFDWLRQV
KDYHEHHQSXEOLVKHG:DNLWDQLKDVSXEOLVKHGDVPDOOFDVHVHULHVRIQLQHGHIHFWVLQILYHNQHHV
LQYROYLQJ VXUJLFDO WUDQVSODQWDWLRQ RI PHVHQFK\PDO VWHP FHOOV ZLWK FRYHUDJH RI WKH WUHDWHG
FKRQGUDOGHIHFWV&HQWHQRHWDOKDYHUHSRUWHGKLJKILHOG05,HYLGHQFHRILQFUHDVHGFDUWLODJH
DQG PHQLVFXV YROXPH LQ LQGLYLGXDO KXPDQ FOLQLFDO VXEMHFWV +RZHYHU &HQWHQR V VWHP FHOO
FOLQLFLVTXLWHFRQWURYHUVLDODQGWKHUHVXOWVKDYHQRWEHHQSXEOLVKHGIRUPRUHWUHDWHGSDWLHQWV
0DQ\RWKHUVWHPFHOOEDVHGWUHDWPHQWVDUHRSHUDWLQJRXWVLGHWKH86ZLWKPXFKFRQWURYHUV\
EHLQJUHSRUWHGUHJDUGLQJWKHVHWUHDWPHQWVDVVRPHIHHOPRUH UHJXODWLRQ LV QHHGHGDVFOLQLFV
WHQGWRH[DJJHUDWHFODLPVRIVXFFHVVDQGPLQLPL]HRURPLWULVNV

)LUVWWUDQVSODQWHGKXPDQRUJDQJURZQIURPDGXOWVWHPFHOOV

,Q  WKH ILUVW IXOO WUDQVSODQW RI D KXPDQ RUJDQ JURZQ IURP DGXOW VWHP FHOOV ZDV
FDUULHGRXWDWWKH+RVSLWDO&OtQLFRI%DUFHORQDRQ&ODXGLD&DVWLOORD&RORPELDQIHPDOHDGXOW
ZKRVHWUDFKHDKDGFROODSVHG GXH WR WXEHUFXORVLV 5HVHDUFKHUVIURPWKH8QLYHUVLW\RI3DGXD
DQGWKH8QLYHUVLW\RI%ULVWROKDUYHVWHGDVHFWLRQRIWUDFKHDIURPDGRQRUDQGVWULSSHGRIIWKH
FHOOVWKDWFRXOGFDXVHDQLPPXQHUHDFWLRQOHDYLQJDJUH\WUXQNRIFDUWLODJH7KLVVHFWLRQRI
WUDFKHDZDVWKHQVHHGHGZLWKVWHPFHOOVWDNHQIURP0V&DVWLOOR VERQHPDUURZDQGDQHZ
VHFWLRQ RI WUDFKHD ZDV JURZQ LQ WKH ODERUDWRU\ RYHU IRXU GD\V 7KH QHZ VHFWLRQ RI WUDFKHD
ZDVWKHQWUDQVSODQWHGLQWRWKHOHIWPDLQEURQFKXVRIWKHSDWLHQW%HFDXVHWKHVWHPFHOOVZHUH
KDUYHVWHG IURP WKH SDWLHQW V RZQ ERQH PDUURZ 3URIHVVRU 0DFFKLDULQL GLG QRW WKLQN LW ZDV
QHFHVVDU\ IRU KHU WR EH JLYHQ DQWLUHMHFWLRQ LPPXQRVXSSUHVVLYH  PHGLFDWLRQ DQG ZKHQ WKH
SURFHGXUH ZDV UHSRUWHG IRXU PRQWKV ODWHU LQ 7KH /DQFHW WKH SDWLHQW V LPPXQH V\VWHP ZDV
VKRZLQJQRVLJQVRIUHMHFWLQJWKHWUDQVSODQW

$GXOWVWHPFHOOVDQG&DQFHU

,Q UHFHQW \HDUV DFFHSWDQFH RI WKH FRQFHSW RI DGXOW VWHP FHOOV KDV LQFUHDVHG 7KHUH LV
QRZDWKHRU\WKDWVWHPFHOOVUHVLGHLQPDQ\DGXOWWLVVXHVDQGWKDWWKHVHXQLTXHUHVHUYRLUVRI
FHOOV DUH QRW RQO\ UHVSRQVLEOH IRU WKH QRUPDO UHSDUDWLYH DQG UHJHQHUDWLYH SURFHVVHV EXW DUH
DOVRFRQVLGHUHGWREHDSULPHWDUJHWIRUJHQHWLFDQGHSLJHQHWLFFKDQJHVFXOPLQDWLQJLQPDQ\
DEQRUPDOFRQGLWLRQVLQFOXGLQJFDQFHU


6WHPFHOOWUHDWPHQWV
 
0HGLFDO UHVHDUFKHUV EHOLHYH WKDW VWHP FHOO WKHUDS\ KDV WKH SRWHQWLDO WR GUDPDWLFDOO\
FKDQJH WKH WUHDWPHQW RI KXPDQ GLVHDVH $ QXPEHU RI DGXOW VWHP FHOO WKHUDSLHV H[LVW
SDUWLFXODUO\ ERQH PDUURZ WUDQVSODQWV WKDW DUH XVHG WR WUHDW OHXNHPLD ,Q WKH IXWXUH PHGLFDO
UHVHDUFKHUVDQWLFLSDWHEHLQJDEOHWRXVHWHFKQRORJLHVGHULYHGIURPVWHPFHOOUHVHDUFKWRWUHDWD
ZLGHUYDULHW\RIGLVHDVHVLQFOXGLQJFDQFHU3DUNLQVRQ¶VGLVHDVHVSLQDOFRUGLQMXULHVPXOWLSOH
VFOHURVLV DQG PXVFOH GDPDJH DPRQJVW D QXPEHU RI RWKHU LPSDLUPHQWV DQG FRQGLWLRQV

Ϯϱϯ

+RZHYHUWKHUHVWLOOH[LVWVDJUHDWGHDORIVRFLDODQGVFLHQWLILFXQFHUWDLQW\VXUURXQGLQJVWHP
FHOOUHVHDUFKZKLFKFRXOGSRVVLEO\EHRYHUFRPHWKURXJKSXEOLFGHEDWHDQGIXWXUHUHVHDUFK
DQGIXUWKHUHGXFDWLRQRIWKHSXEOLF
6WHP FHOOV KRZHYHUDUH DOUHDG\ XVHGH[WHQVLYHO\ LQ UHVHDUFK DQG VRPH VFLHQWLVWV GR
QRWVHHFHOOWKHUDS\DVWKHILUVWJRDORIWKHUHVHDUFKEXWVHHWKHLQYHVWLJDWLRQRIVWHPFHOOVDVD
JRDOZRUWK\LQLWVHOI

+HDUWPXVFOHUHSDLU


)LJXUH+HDUWPXVFOHUHSDLUZLWKDGXOWVWHPFHOOV

)RU H[DPSOH LW PD\ EHFRPH SRVVLEOH WR JHQHUDWH KHDOWK\ KHDUW PXVFOH FHOOV LQ WKH
ODERUDWRU\ DQG WKHQ WUDQVSODQW WKRVH FHOOV LQWR SDWLHQWV ZLWK FKURQLF KHDUW GLVHDVH
3UHOLPLQDU\ UHVHDUFK LQ PLFH DQG RWKHU DQLPDOV LQGLFDWHV WKDW ERQH PDUURZ VWHP FHOOV
WUDQVSODQWHG LQWR D GDPDJHG KHDUW FDQ JHQHUDWH KHDUW PXVFOH FHOOV DQG VXFFHVVIXOO\
UHSRSXODWHWKHKHDUWWLVVXH2WKHUUHFHQWVWXGLHVLQFHOOFXOWXUHV\VWHPVLQGLFDWHWKDWLWPD\
EHSRVVLEOHWRGLUHFWWKHGLIIHUHQWLDWLRQRIHPEU\RQLFVWHPFHOOVRUDGXOWERQHPDUURZFHOOV
LQWRKHDUWPXVFOHFHOOV )LJXUH 

2UJDQDQGWLVVXHUHJHQHUDWLRQ
7LVVXH UHJHQHUDWLRQ LV SUREDEO\ WKH PRVW LPSRUWDQW SRVVLEOH DSSOLFDWLRQ RI VWHP FHOO
UHVHDUFK&XUUHQWO\RUJDQVPXVWEHGRQDWHGDQGWUDQVSODQWHGEXWWKHGHPDQGIRURUJDQVIDU
H[FHHGVVXSSO\6WHPFHOOVFRXOGSRWHQWLDOO\EHXVHGWR JURZDSDUWLFXODU W\SH RI WLVVXH RU
RUJDQLIGLUHFWHGWRGLIIHUHQWLDWHLQDFHUWDLQZD\6WHPFHOOVWKDWOLHMXVWEHQHDWKWKHVNLQIRU
H[DPSOHKDYHEHHQXVHGWRHQJLQHHUQHZVNLQWLVVXHWKDWFDQEHJUDIWHGRQWREXUQYLFWLPV

%UDLQGLVHDVHWUHDWPHQW
$GGLWLRQDOO\UHSODFHPHQWFHOOVDQGWLVVXHVPD\EHXVHGWRWUHDWEUDLQGLVHDVHVXFKDV
3DUNLQVRQ VDQG$O]KHLPHU VE\UHSOHQLVKLQJGDPDJHGWLVVXHEULQJLQJEDFNWKHVSHFLDOL]HG

Ϯϱϰ

 EUDLQ FHOOV WKDW NHHS XQQHHGHG PXVFOHV IURP PRYLQJ (PEU\RQLF VWHPFHOOV KDYH UHFHQWO\
EHHQGLUHFWHGWRGLIIHUHQWLDWHLQWRWKHVHW\SHVRIFHOOVDQGVRWUHDWPHQWVDUHSURPLVLQJ

&HOOGHILFLHQF\WKHUDS\
+HDOWK\KHDUWFHOOVGHYHORSHGLQDODERUDWRU\PD\RQHGD\EHWUDQVSODQWHGLQWRSDWLHQWV
ZLWKKHDUWGLVHDVHUHSRSXODWLQJWKHKHDUWZLWKKHDOWK\WLVVXH6LPLODUO\SHRSOHZLWKW\SH,
GLDEHWHV PD\ UHFHLYH SDQFUHDWLF FHOOV WR UHSODFH WKH LQVXOLQSURGXFLQJ FHOOVWKDW KDYH EHHQ
ORVW RU GHVWUR\HG E\ WKH SDWLHQW V RZQ LPPXQH V\VWHP 7KH RQO\ FXUUHQW WKHUDS\ LV D
SDQFUHDWLF WUDQVSODQW DQG LW LV XQOLNHO\ WR RFFXU GXH WR D VPDOO VXSSO\ RI SDQFUHDVHV
DYDLODEOHIRUWUDQVSODQW

%ORRGGLVHDVHWUHDWPHQWV
$GXOWKHPDWRSRLHWLF VWHPFHOOV IRXQG LQ EORRGDQG ERQHPDUURZKDYHEHHQXVHGIRU
\HDUVWRWUHDWGLVHDVHVVXFKDVOHXNHPLDVLFNOHFHOODQHPLDDQGRWKHULPPXQRGHILFLHQFLHV
7KHVHFHOOVDUHFDSDEOHRISURGXFLQJDOOEORRGFHOOW\SHVVXFKDVUHGEORRGFHOOVWKDWFDUU\
R[\JHQ WR ZKLWH EORRG FHOOV WKDW ILJKW GLVHDVH 'LIILFXOWLHV DULVH LQ WKH H[WUDFWLRQ RI WKHVH
FHOOV WKURXJK WKH XVH RI LQYDVLYH ERQH PDUURZ WUDQVSODQWV +RZHYHU KHPDWRSRLHWLF VWHP
FHOOVKDYHDOVREHHQIRXQGLQWKHXPELOLFDOFRUGDQGSODFHQWD7KLVKDVOHGVRPHVFLHQWLVWVWR
FDOOIRUDQXPELOLFDO FRUG EORRG EDQN WR PDNH WKHVHSRZHUIXOFHOOV PRUHHDVLO\REWDLQDEOH
DQGWRGHFUHDVHWKHFKDQFHVRIDERG\ VUHMHFWLQJWKHUDS\

5HVHDUFKZLWKVWHPFHOOV
6FLHQWLVWV DQG UHVHDUFKHUV DUH LQWHUHVWHG LQ VWHP FHOOV IRU VHYHUDO UHDVRQV $OWKRXJK
VWHPFHOOVGRQRWVHUYHDQ\RQHIXQFWLRQPDQ\KDYHWKHFDSDFLW\WRVHUYHDQ\IXQFWLRQDIWHU
WKH\DUHLQVWUXFWHGWRVSHFLDOL]H(YHU\FHOO LQ WKHERG\ IRU H[DPSOH LVGHULYHG IURP ILUVW
IHZ VWHP FHOOV IRUPHG LQ WKH HDUO\ VWDJHV RI HPEU\RORJLFDO GHYHORSPHQW 7KHUHIRUH VWHP
FHOOVH[WUDFWHGIURPHPEU\RVFDQEHLQGXFHGWREHFRPHDQ\GHVLUHGFHOOW\SH7KLVSURSHUW\
PDNHVVWHPFHOOVSRZHUIXOHQRXJKWRUHJHQHUDWHGDPDJHGWLVVXHXQGHUWKHULJKWFRQGLWLRQV

*HQHUDOVFLHQWLILFGLVFRYHU\

6WHP FHOO UHVHDUFK LV DOVR XVHIXO IRU OHDUQLQJ DERXW KXPDQ GHYHORSPHQW
8QGLIIHUHQWLDWHGVWHPFHOOVHYHQWXDOO\GLIIHUHQWLDWHSDUWO\EHFDXVHDSDUWLFXODUJHQHLVWXUQHG
RQRURII6WHP FHOO UHVHDUFKHUV PD\KHOS WR FODULI\WKHUROHWKDWJHQHVSOD\LQGHWHUPLQLQJ
ZKDWJHQHWLFWUDLWVRUPXWDWLRQVZHUHFHLYH&DQFHUDQGRWKHUELUWKGHIHFWVDUHDOVRDIIHFWHG
E\DEQRUPDOFHOOGLYLVLRQDQGGLIIHUHQWLDWLRQ1HZWKHUDSLHVIRUGLVHDVHVPD\EHGHYHORSHGLI
ZHEHWWHUXQGHUVWDQGKRZWKHVHDJHQWVDWWDFNWKHKXPDQERG\
$QRWKHU UHDVRQ ZK\ VWHP FHOO UHVHDUFK LV EHLQJ SXUVXHG LV WR GHYHORS QHZ GUXJV
6FLHQWLVWV FRXOG PHDVXUH D GUXJ V HIIHFW RQ KHDOWK\ QRUPDO WLVVXH E\ WHVWLQJ WKH GUXJ RQ
WLVVXHJURZQIURPVWHPFHOOVUDWKHUWKDQWHVWLQJWKHGUXJRQKXPDQYROXQWHHUV

:KHQGRHVOLIHEHJLQ"
7KHFRUHRIWKLVGHEDWHVLPLODUWRGHEDWHVDERXWDERUWLRQIRUH[DPSOHFHQWHUVRQWKH
TXHVWLRQ:KHQGRHVOLIHEHJLQ"0DQ\DVVHUWWKDWOLIHEHJLQVDWFRQFHSWLRQZKHQWKHHJJ
LV IHUWLOL]HG ,W LV RIWHQ DUJXHG WKDW WKH HPEU\R GHVHUYHV WKH VDPH VWDWXV DV DQ\ RWKHU IXOO
JURZQKXPDQ7KHUHIRUHGHVWUR\LQJLW UHPRYLQJWKHEODVWRF\VWWRH[WUDFWVWHPFHOOV LVDNLQ

Ϯϱϱ

 WR PXUGHU 2WKHUV LQ FRQWUDVW KDYH LGHQWLILHG GLIIHUHQW SRLQWV LQ JHVWDWLRQDO GHYHORSPHQW
WKDW PDUN WKH EHJLQQLQJ RI OLIH  DIWHU WKH GHYHORSPHQW RI FHUWDLQ RUJDQVRU DIWHUD FHUWDLQ
WLPHSHULRG

&KLPHUDV
3HRSOHDOVRWDNHLVVXHZLWKWKHFUHDWLRQRIFKLPHUDV$FKLPHUDLVDQRUJDQLVPWKDWKDV
ERWK KXPDQ DQG DQLPDO FHOOV DQG WLVVXHV 2IWHQ LQ VWHP FHOO UHVHDUFK KXPDQ FHOOV DUH
LQVHUWHGLQWRDQLPDOV OLNHPLFHRUUDWV DQGDOORZHGWRGHYHORS7KLVFUHDWHVWKHRSSRUWXQLW\
IRUUHVHDUFKHUVWRVHHZKDWKDSSHQVZKHQVWHPFHOOVDUHLPSODQWHG0DQ\SHRSOHKRZHYHU
REMHFWWRWKHFUHDWLRQRIDQRUJDQLVPWKDWLVSDUWKXPDQ

/HJDOLVVXHV
7KH VWHP FHOO GHEDWH KDV ULVHQ WR WKH KLJKHVW OHYHO RI FRXUWV LQ VHYHUDO FRXQWULHV
3URGXFWLRQ RI HPEU\RQLF VWHP FHOO OLQHV LV LOOHJDO LQ $XVWULD 'HQPDUN )UDQFH *HUPDQ\
DQG,UHODQGEXWSHUPLWWHGLQ)LQODQG*UHHFHWKH1HWKHUODQGV6ZHGHQDQGWKH8.,QWKH
8QLWHG6WDWHVLWLVQRWLOOHJDOWRZRUNZLWKRUFUHDWHHPEU\RQLFVWHPFHOOOLQHV+RZHYHUWKH
GHEDWH LQ WKH 86 LV DERXW IXQGLQJ DQG LW LV LQ IDFW LOOHJDO IRU IHGHUDO IXQGV WR EH XVHG WR
UHVHDUFKVWHPFHOOOLQHVWKDWZHUHFUHDWHGDIWHU$XJXVW
6WHPFHOOFKDUDFWHUL]DWLRQE\LPPXQRF\WRFKHPLVWU\

)ROORZLQJ WKH LVRODWLRQ RI FHOO SRSXODWLRQV XVLQJ GLIIHUHQWLDO DGKHVLRQ RU PDJQHWLF
EHDGVWKHFHOOSKHQRW\SHVFDQEHFKDUDFWHUL]HGLPPXQRF\WRFKHPLFDOO\7KLVFDQEHGRQHLQ
RQH RI VHYHUDO ZD\V LQFOXGLQJ )$&6 DQDO\VLV LI DYDLODEOH RU WKH FHOOV FDQ EH IL[HG RQWR
PLFURVFRSHVOLGHVE\DLUGU\LQJRUXVHRIDF\WRVSLQVWDLQHGDQGH[DPLQHGE\IOXRUHVFHQFH
PLFURVFRS\ $OWHUQDWLYHO\ LQ WKH DEVHQFH RI D IOXRUHVFHQFH PLFURVFRSH VWDLQLQJ FDQ EH
FDUULHGRXWXVLQJDVWDLQLQJPHWKRGZKHUHE\WKHORFDWLRQRIWKHDQWLERG\LVYLVXDOL]HGE\D
FRORXUUHDFWLRQZLWKDVXEVWUDWHVXFKDV GLDPLQREHQ]LGLQH2QHUHOLDEOHZD\WRXVHWKH
ODWWHU PHWKRG LV ZLWK D NLW VXFK DV WKH 9(&7$67$,1 (OLWH $%& NLW IURP 9HFWRU
/DERUDWRULHV7KHUHIROORZVDGHVFULSWLRQRISURWHLQVWKDWDUHXVHIXODVPDUNHUVWRGLVWLQJXLVK
VXESRSXODWLRQV RI VRPH HSLWKHOLDO FHOO W\SHV DORQJ ZLWK PHWKRGV IRU WKH SUHSDUDWLRQ RI
VDPSOHVRIFHOOVIRUVWDLQLQJ

$QWLERG\PDUNHUVRIGLIIHUHQWLDWHGFHOOSKHQRW\SHV

&HOOV RI DOO WLVVXHV H[SUHVV D ZLGH UHSHUWRLUH RI FHOO VXUIDFH DQG F\WRSODVPLF SURWHLQV
DQGPDQ\RIWKHVHDUHFHOOW\SHVSHFLILFZKLOHRWKHUVVKRZFKDQJHVRIH[SUHVVLRQGXULQJWKH
GLIIHUHQWLDWLRQRIWKHFHOOVLQDQHSLWKHOLXPRULQYLWUR

7KH FHOO VXUIDFH SURWHLQV LQFOXGH WKH LQWHJULQV WRJHWKHU ZLWK D ZLGH QXPEHU RI RWKHU
PHPEHUVRIWKH&' FOXVWHURIGLIIHUHQWLDWLRQ DQWLJHQVVXFKDV&'&'&'&'
2QH RI WKH PDMRU JURXSV RI F\WRSODVPLF SURWHLQV H[SUHVVHG E\ HSLWKHOLDO FHOOV LV WKH
F\WRNHUDWLQIDPLO\DQGWKLVKDVSURYHGDXVHIXOVHWRIPDUNHUVRIHSLWKHOLDOWLVVXHW\SH

.HUDWLQPDUNHUVRIHSLWKHOLDOFHOOW\SH

&\WRNHUDWLQV IRUP LQWHUPHGLDWH ILODPHQWV DQG DUH FODVVLILHG DV PHPEHUV RI HLWKHU WKH
EDVLF RU DFLGLF VXEIDPLOLHV ZLWK RQH EDVLF F\WRNHUDWLQ DOZD\V H[SUHVVHG WRJHWKHU ZLWK DQ
DFLGLFSDUWQHU )RUH[DPSOH NHUDWLQ  LV DOZD\V IRXQG FRH[SUHVVHG ZLWK F\WRNHUDWLQ  ,Q
YDULRXVEDVDOFHOOOD\HUV.LVDOVRIRXQGSDLULQJ.DQGZKLOH.SDLUVZLWK.

Ϯϱϲ

DQG2WKHUSDLUVLQFOXGH.OZLWKZLWKDQGZLWK.LVXQXVXDOLQWKDWLWFDQ
SDLU ZLWK HLWKHU . RU . GHSHQGLQJ RQ LWV ORFDWLRQ 7KH F\WRNHUDWLQV DUH DOO UHODWLYHO\
DEXQGDQWDQGVWDEOHZKLFKPDNHVWKHPVXLWDEOHIRULPPXQRORJLFDOGHWHFWLRQDQGDOWKRXJK
WKH PHPEHUV RI WKH NHUDWLQ IDPLO\ VKDUH D KLJK GHJUHH RI KRPRORJ\ WKHUH DUH VXIILFLHQW
GLIIHUHQFHVIRUVSHFLILFDQWLERGLHVWRKDYHEHHQUDLVHGDJDLQVWPRVWRIWKHP6RPHDQWLERGLHV
DOVR UHFRJQL]H D PRUH ZLGHO\ H[SUHVVHG HSLWRSHDQG ZLOO VHH VHYHUDO GLIIHUHQW F\WRNHUDWLQV
7KHVHDQWLERGLHVLQFOXGH/3ZKLFKZLOOSRVLWLYHO\VWDLQPRVWFHOOVRIHSLWKHOLDORULJLQDQG
FDQEHFRQVLGHUHGDSDQF\WRNHUDWLQDQWLERG\

7KHVHDUHQRZDYDLODEOHIURPDYDULHW\RIFRPPHUFLDOVRXUFHV7ZRF\WRNHUDWLQVKDYH
EHHQ VKRZQ WR VWDLQ GLVWLQFW VXESRSXODWLRQV RI EDVDO NHUDWLQRF\WHV DQG PD\ SURYH WR EH
PDUNHUV IRU HSLGHUPDO VWHP FHOOV &\WRNHUDWLQ  ZDV VKRZQ WR VWDLQ UHJLRQV RI WKH KDLU
IROOLFOHLQGLYLGXDOLQWHJULQEULJKWLQWHUIROOLFXODUFHOOVDQGVRPHFHOOVLQFXOWXUH$VWKHKDLU
IROOLFOHLVUHSRUWHGWR FRQWDLQ VWHPFHOOVWKLV PD\ EH XVHIXO0RUHUHFHQWO\ /\OH HWDO  KDYH
VKRZQWKDW&%DQDQWLERG\RULJLQDOO\UDLVHGDJDLQVW&'D7FHOOPDUNHUUHFRJQL]HV
F\WRNHUDWLQ  LQ D UHVWULFWHG SRSXODWLRQ RI KDLU IROOLFOH FHOOV ZLWK VWHP FHOO FKDUDFWHULVWLFV
VXFKDVODEHOUHWHQWLRQDQGKLJK%LQWHJULQH[SUHVVLRQ 7KH ODFN RI FHOOW\SHVSHFLILFLW\ RI
WKLVDQWLERG\ PDNHV LW SRWHQWLDOO\ SUREOHPDWLFIRU XVH LQRWKHUWLVVXHVDQGRWKHUF\WRNHUDWLQ
VSHFLILFDQWLERGLHVKDYHVKRZQDZLGHUGLVWULEXWLRQRIVWDLQLQJLQWKHVNLQ

&HOOVXUIDFHPDUNHUVRIHSLWKHOLDOFHOOW\SH

7KHUH DUH PDQ\ GLIIHUHQW SURWHLQV IRXQG RQ WKH FHOO VXUIDFH UDQJLQJ IURP KLJKO\
DEXQGDQWDGKHVLRQPROHFXOHVWRJURZWKIDFWRUUHFHSWRUVDQGSURWHLQVRIDV\HWXQGHWHUPLQHG
IXQFWLRQ &HOO VXUIDFH PDUNHUV DUH XVHIXO WRROV IRU WKH FHOO ELRORJLVW EHFDXVH WKH\ FDQ EH
GHWHFWHGE\DQWLERGLHVZLWKRXWSULRUIL[DWLRQRUSHUPHDELOL]DWLRQRIWKHFHOOV7KLVDOORZVWKH
XVH RI IORZ F\WRPHWU\ RU LPPXQRPDJQHWLF EHDGV IRU FHOO VHSDUDWLRQ WR LVRODWH YLDEOH FHOO
SRSXODWLRQVIURPWLVVXH7KHFKRLFHRIDVXLWDEOHFHOOVXUIDFHPDUNHUIRUWKHFKDUDFWHUL]DWLRQ
RIH[SHULPHQWDOO\LVRODWHGFHOOVGHSHQGVRQVHYHUDOFULWHULD6RPHPDUNHUVZLOOGHWHFWDOOFHOOV
RIRQHW\SHZKLOHRWKHUVPD\UHFRJQL]HRQO\DGLIIHUHQWLDWHGRUXQGLIIHUHQWLDWHGVXEVHW$V
WKHFHOOVZLOO QRUPDOO\ KDYH EHHQLVRODWHG E\ WU\SVLQL]DWLRQWKHWDUJHWPDUNHUHSLWRSHPXVW
QRWEHVHQVLWLYHWRWU\SVLQFOHDYDJHDSUREOHPZLWKSDUWLFXODU DQWLERGLHVUHFRJQL]LQJ VRPH
WUDQVPHPEUDQH SURWHLQV VXFK DV &' DQG V\QGHFDQ 0RVW PDUNHUV RI WKLV W\SH DUH
GLIIHUHQWLDOO\H[SUHVVHGEHWZHHQFHOOOD\HUVLQHSLWKHOLDOWLVVXHVVXFKDVWKHVNLQEUHDVWDQG
SURVWDWHZKLOHVRPHRIWKHPDUHPRUHVSHFLILFIRUWLVVXHW\SHVXFKDV08&LQWKHEUHDVW
OXPLQDOHSLWKHOLDOFHOOV

6WDLQLQJFHOOVXVSHQVLRQVXVLQJF\WRVSLQSUHSDUDWLRQV

7KHIROORZLQJSURWRFROLVDUDSLGPHWKRGWRIL[FHOOVRQWRDJODVVPLFURVFRSHVOLGHIRU
LPPXQRVWDLQLQJ 7KH VHFRQG SDUW GHWDLOV D PHWKRG WR IL[ FHOOV RQWR FRYHUVOLSV IRU VWDLQLQJ
ZLWKRXWWKHXVHRIDF\WRVSLQ:KLOHWKHVHFRQGPHWKRGWDNHVDORQJHUWLPHLWLVDVHIIHFWLYH
DVWKHILUVW

6WHPFHOOFRQWURYHUV\

7KHUH H[LVWV D ZLGHVSUHDG FRQWURYHUV\ RYHU KXPDQ HPEU\RQLF VWHPFHOOUHVHDUFKWKDW
HPDQDWHVIURPWKHWHFKQLTXHVXVHGLQWKHFUHDWLRQDQGXVDJHRIVWHPFHOOV+XPDQHPEU\RQLF
VWHP FHOO UHVHDUFK LV FRQWURYHUVLDO EHFDXVH ZLWK WKH SUHVHQW VWDWH RI WHFKQRORJ\ VWDUWLQJ D
VWHP FHOO OLQH UHTXLUHV WKH GHVWUXFWLRQ RI D KXPDQ HPEU\R DQGRU WKHUDSHXWLF FORQLQJ

Ϯϱϳ

+RZHYHU UHFHQWO\ LW KDV EHHQ VKRZQ LQ SULQFLSOH WKDW DGXOW VWHP FHOO OLQHV FDQ EH
PDQLSXODWHGWRJHQHUDWHHPEU\RQLFOLNH VWHP FHOO OLQHV XVLQJ D VLQJOHFHOOELRSV\VLPLODUWR
WKDW XVHG LQ SUHLPSODQWDWLRQ JHQHWLF GLDJQRVLV WKDW PD\ DOORZ VWHP FHOO FUHDWLRQ ZLWKRXW
HPEU\RQLFGHVWUXFWLRQ,WLVQRWWKHHQWLUHILHOGRIVWHPFHOOUHVHDUFKEXWWKHVSHFLILFILHOGRI
KXPDQHPEU\RQLFVWHPFHOOUHVHDUFKWKDWLVDWWKHFHQWUHRIDQHWKLFDOGHEDWH

2SSRQHQWVRI WKHUHVHDUFKDUJXH WKDWHPEU\RQLFVWHPFHOO WHFKQRORJLHV DUHD VOLSSHU\
VORSHWRUHSURGXFWLYHFORQLQJDQGFDQIXQGDPHQWDOO\GHYDOXHKXPDQ OLIH 7KRVH LQ WKH SUR
OLIHPRYHPHQWDUJXHWKDWDKXPDQHPEU\RLVDKXPDQOLIHWKDWLVHQWLWOHGWRSURWHFWLRQ

&RQWUDULO\VXSSRUWHUVRIHPEU\RQLFVWHPFHOOUHVHDUFKDUJXHWKDWVXFKUHVHDUFKVKRXOG
EHSXUVXHGEHFDXVHWKHUHVXOWDQWWUHDWPHQWVFRXOGKDYHVLJQLILFDQWPHGLFDOSRWHQWLDO,WLVDOVR
QRWHGWKDWH[FHVVHPEU\RVFUHDWHGIRULQYLWURIHUWLOL]DWLRQFRXOGEHGRQDWHGZLWKFRQVHQWDQG
XVHGIRUWKHUHVHDUFK

7KH HQVXLQJ GHEDWH KDV SURPSWHG DXWKRULWLHV DURXQG WKH ZRUOG WR VHHN UHJXODWRU\
IUDPHZRUNV DQG KLJKOLJKWHG WKH IDFW WKDW VWHP FHOO UHVHDUFK UHSUHVHQWV D VRFLDO DQG HWKLFDO
FKDOOHQJH

7KH GHEDWHV VXUURXQGLQJ VWHP FHOO UHVHDUFK SULPDULO\ DUH GULYHQ E\ PHWKRGV FRQFHUQLQJ
HPEU\RQLFVWHPFHOOUHVHDUFK,WZDVRQO\LQWKDWUHVHDUFKHUVIURPWKH8QLYHUVLW\RI:LVFRQVLQ
0DGLVRQ H[WUDFWHG WKH ILUVW KXPDQ HPEU\RQLF VWHP FHOOV WKDW ZHUH DEOH WR EH NHSW DOLYH LQ WKH
ODERUDWRU\7KHPDLQFULWLTXHRIWKLVUHVHDUFKLVWKDWLWUHTXLUHGWKHGHVWUXFWLRQRIDKXPDQEODVWRF\VW
7KDWLVDIHUWLOL]HGHJJZDVQRWJLYHQWKHFKDQFHWRGHYHORSLQWRDIXOO\GHYHORSHGKXPDQ
5HIHUHQFHV

$OWPDQ - DQG 'DV *'   $XWRUDGLRJUDSKLF DQG KLVWRORJLFDO HYLGHQFH RI SRVWQDWDO
KLSSRFDPSDOQHXURJHQHVLVLQUDWV-&RPS1HXURO  ±
$OWPDQ - DQG 'DV *'   $XWRUDGLRJUDSKLF DQG KLVWRORJLFDO HYLGHQFH RI SRVWQDWDO
KLSSRFDPSDOQHXURJHQHVLVLQUDWV-&RPS1HXURO  ±
%HDFK\3$.DUKDGNDU66DQG%HUPDQ'0  7LVVXHUHSDLUDQGVWHPFHOOUHQHZDOLQ
FDUFLQRJHQHVLV1DWXUH
&KDXGKDU\ 30 DQG 5RQLQVRQ ,%   ([SUHVVLRQ DQG DFWLYLW\ RI 3JO\FRSURWHLQ D
PXOWLGUXJHIIOX[SXPSLQKXPDQKHPDWRSRLHWLFVWHPFHOOV&HOO  ±
&RQFLVHUHYLHZPHVHQFK\PDOVWHPPXOWLSRWHQWVWURPDOFHOOVWKHVWDWHRIWUDQVGLIIHUHQWLDWLRQ
DQG PRGHV RI WLVVXH UHSDLUFXUUHQW YLHZV 6WHP &HOOV  1RY  
(SXE6HS5HYLHZ
&RQFLVHUHYLHZPHVHQFK\PDOVWHPPXOWLSRWHQWVWURPDOFHOOVWKHVWDWHRIWUDQVGLIIHUHQWLDWLRQ
DQG PRGHV RI WLVVXH UHSDLUFXUUHQW YLHZV 6WHP &HOOV  1RY  
(SXE6HS5HYLHZ
'RQWX*-DFNVRQ.:0F1LFKRODV(.DZDPXUD0-$EGDOODK:0DQG:LFKD06  
5ROH RI 1RWFK VLJQDOLQJ LQ FHOOIDWH GHWHUPLQDWLRQ RI KXPDQ PDPPDU\
VWHPSURJHQLWRUFHOOV%UHDVW&DQFHU5HV5±
'RQWX*-DFNVRQ.:0F1LFKRODV(.DZDPXUD0-$EGDOODK:0DQG:LFKD06  
5ROH RI 1RWFK VLJQDOLQJ LQ FHOOIDWH GHWHUPLQDWLRQ RI KXPDQ PDPPDU\
VWHPSURJHQLWRUFHOOV%UHDVW&DQFHU5HV5±
)LOLS6(QJOLVK'DQG0RNU\-  ,VVXHVLQVWHPFHOOSODVWLFLW\-&HOO0RO0HG  
±

Ϯϱϴ

)LOLS6(QJOLVK'DQG0RNU\-  ,VVXHVLQVWHPFHOOSODVWLFLW\-&HOO0RO0HG  
±
+DXSW<%DWK0/+DUULV$:DQG$GDPV-0  EPLWUDQVJHQHLQGXFHVO\PSKRPDV
DQGFROODERUDWHVZLWKP\FLQWXPRULJHQHVLV2QFRJHQH±
+DXSW<%DWK0/+DUULV$:DQG$GDPV-0  EPLWUDQVJHQHLQGXFHVO\PSKRPDV
DQGFROODERUDWHVZLWKP\FLQWXPRULJHQHVLV2QFRJHQH±

KWWSVFLWHFKGDLO\FRP$VLWHWKDWRIIHUVDUDQJHRIQHZVDUWLFOHVIHDWXUHVDQGFRPPHQWDULHV
DERXWVFLHQFHDQGWHFKQRORJ\WRSLFV6HDUFKIRUVWHPFHOOV

KWWSVWHPFHOOVQLKJRY([WHUQDO/LQN'LFWLRQDU\ZZZQHZVZLVFHGXSDFNDJHVVWHPFHOOVKWP
7KH 8QLYHUVLW\ RI :LVFRQVLQ V :HE VLWH DERXW VWHP FHOOV ZULWWHQ IRU JHQHUDO
DXGLHQFHV

KWWSVWHPFHOOVQLKJRY([WHUQDO/LQN'LFWLRQDU\ZZZUHXWHUVFRPQHZV&KDQQHOMKWPO"W\SH
VFLHQFH1HZV7KH5HXWHUVQHZVVLWHIRUVWRULHVDERXWVFLHQFH6HDUFKIRUVWHPFHOOV
DQGVHOHFW1HZVDQG3LFWXUHV

KWWSVWHPFHOOVQLKJRY([WHUQDO/LQN'LFWLRQDU\ZZZVFLDPFRPLQGH[FIP7KH:HEVLWHIRU
6FLHQWLILF$PHULFDQ6HDUFKIRUVWHPFHOOV

KWWSVWHPFHOOVQLKJRY([WHUQDO/LQN'LFWLRQDU\ZZZVWHPFHOOUHVHDUFKQHZVFRPLQGH[KWP
$FRPPHUFLDORQOLQHQHZVOHWWHUWKDWIHDWXUHVVWRULHVDERXWVWHPFHOOVRIDOOW\SHV

KWWSZZZHXUHNDOHUWRUJ(XUHN$OHUW LV DSXEOLFO\ DFFHVVLEOHVFLHQFHQHZVVLWHUXQE\WKH

$PHULFDQ$VVRFLDWLRQIRUWKH$GYDQFHPHQWRI6FLHQFHV6HDUFKIRUVWHPFHOOV

/LX 6 'RQWX * DQG :LFKD 06   0DPPDU\ VWHP FHOOV VHOIUHQHZDO SDWKZD\V DQG
FDUFLQRJHQHVLV%UHDVW&DQFHU5HV  ±
/LX 6 'RQWX * DQG :LFKD 06   0DPPDU\ VWHP FHOOV VHOIUHQHZDO SDWKZD\V DQG
FDUFLQRJHQHVLV%UHDVW&DQFHU5HV  ±
0RORIVN\ $9 3DUGDO 5 ,ZDVKLWD7 3DUN ,. &ODUNH 0) DQG 0RUULVRQ 6-   %PL
GHSHQGHQFHGLVWLQJXLVKHVQHXUDO VWHPFHOO VHOIUHQHZDO IURP SURJHQLWRUSUROLIHUDWLRQ
1DWXUH±
0RORIVN\ $9 3DUGDO 5 ,ZDVKLWD7 3DUN ,. &ODUNH 0) DQG 0RUULVRQ 6-   %PL
GHSHQGHQFHGLVWLQJXLVKHV QHXUDOVWHPFHOOVHOIUHQHZDO IURP SURJHQLWRU SUROLIHUDWLRQ
1DWXUH±
3DUN,.4LDQ'.LHO0%HFNHU0:3LKDOMD0:HLVVPDQ,/0RUULVRQ6-DQG&ODUNH0)
 %PLLVUHTXLUHGIRUPDLQWHQDQFHRIDGXOWVHOIUHQHZLQJKDHPDWRSRLHWLFVWHP
FHOOV1DWXUH±
3DUN,.4LDQ'.LHO0%HFNHU0:3LKDOMD0:HLVVPDQ,/0RUULVRQ6-DQG&ODUNH0)
 %PLLVUHTXLUHGIRUPDLQWHQDQFHRIDGXOWVHOIUHQHZLQJKDHPDWRSRLHWLFVWHP
FHOOV1DWXUH±
6KDFNOHWRQ 0 9DLOODQW ) 6LPSVRQ .- 6WLQJO - 6P\WK *. $VVHOLQ/DEDW 0/ :X /
/LQGHPDQ *- DQG 9LVYDGHU -(  0DPPDU\ VWHP FHOOV VHOIUHQHZDO SDWKZD\V
DQGFDUFLQRJHQHVLV%UHDVW&DQFHU5HV  ±

Ϯϱϵ

6KDFNOHWRQ 0 9DLOODQW ) 6LPSVRQ .- 6WLQJO - 6P\WK *. $VVHOLQ/DEDW 0/ :X /
/LQGHPDQ *- DQG 9LVYDGHU -(  0DPPDU\ VWHP FHOOV VHOIUHQHZDO SDWKZD\V
DQGFDUFLQRJHQHVLV%UHDVW&DQFHU5HV  ±
6KL6%DUWROG300LXUD06HR%05REH\3**URQWKRV6 $XJXVW 7KHHIILFDF\
RI PHVHQFK\PDO VWHP FHOOV WR UHJHQHUDWH DQG UHSDLU GHQWDO VWUXFWXUHV 2UWKRG
&UDQLRIDF5HV  ±
6KL6%DUWROG300LXUD06HR%05REH\3**URQWKRV6 $XJXVW 7KHHIILFDF\
RI PHVHQFK\PDO VWHP FHOOV WR UHJHQHUDWH DQG UHSDLU GHQWDO VWUXFWXUHV 2UWKRG
&UDQLRIDF5HV  ±



















ϮϲϬ

 &KDSWHU
$SSOLFDWLRQVDQG(FRQRPLF,PSOLFDWLRQVRI$QLPDO
%LRWHFKQRORJ\

,QWURGXFWLRQ

7KH GHYHORSLQJ ZRUOG LV JURVVO\ XQSUHSDUHG IRU WKH QHZ WHFKQRORJLFDO DQG HFRQRPLF
RSSRUWXQLWLHV FKDOOHQJHV DQG ULVNV WKDW OLH RQ WKH KRUL]RQ $OWKRXJK LW LV KRSHG WKDW
ELRWHFKQRORJ\ZLOOLPSURYHWKHOLIHRIHYHU\SHUVRQLQWKHZRUOGDQGDOORZPRUHVXVWDLQDEOH
OLYLQJ FUXFLDO GHFLVLRQV PD\ EH GLFWDWHG E\ FRPPHUFLDO FRQVLGHUDWLRQV DQG WKH
VRFLRHFRQRPLF JRDOV WKDW VRFLHW\ FRQVLGHUV WR EH WKH PRVW LPSRUWDQW *OREDOO\ OLYHVWRFN
SURGXFWLRQ LV JURZLQJ IDVWHU WKDQ DQ\ RWKHU VHFWRU DQG E\  OLYHVWRFN LV SUHGLFWHG WR
EHFRPH WKH PRVW LPSRUWDQW DJULFXOWXUDO VHFWRU LQ WHUPV RI DGGHG YDOXH 7KH XVH RI
ELRWHFKQRORJ\ZLOOOHDGWRDGLVWLQFWVKLIWLQWKHHFRQRPLFUHWXUQVIURPOLYHVWRFN/LYHVWRFN
SURGXFWLRQFXUUHQWO\DFFRXQWVIRUDERXWRIWKHJURVVYDOXHRIDJULFXOWXUDOSURGXFWLRQ,Q
GHYHORSHGFRXQWULHVOLYHVWRFNDFFRXQWVIRUPRUHWKDQKDOIRIDJULFXOWXUDOSURGXFWLRQZKLOHLQ
GHYHORSLQJFRXQWULHVWKHVKDUHLVDERXWRQHWKLUG7KLVODWWHUVKDUHKRZHYHULVULVLQJTXLFNO\
EHFDXVH RI UDSLG LQFUHDVHV LQ OLYHVWRFN SURGXFWLRQ UHVXOWLQJ IURP SRSXODWLRQ JURZWK
XUEDQLVDWLRQFKDQJHVLQOLIHVW\OHVDQGGLHWDU\KDELWVDQGLQFUHDVLQJGLVSRVDEOHLQFRPHV

7KH OLYHVWRFN HFRQRP\ LQ GHYHORSLQJ FRXQWULHV /LYHVWRFN LV EHFRPLQJ LQFUHDVLQJO\
LPSRUWDQWLQWKHJURZWKRIDJULFXOWXUHLQGHYHORSLQJHFRQRPLHV7KHFRQWULEXWLRQVPDGHE\
OLYHVWRFNWRERWKDJULFXOWXUHDQGJURVVGRPHVWLFSURGXFW *'3 KDYHULVHQDWDWLPHZKHQWKH
FRQWULEXWLRQRIDJULFXOWXUHWR*'3KDVIDOOHQ7KHGHPDQGIRUOLYHVWRFNSURGXFWVLVDIXQFWLRQ
RILQFRPHDQGVXVWDLQHGJURZWKLQSHUFDSLWDLQFRPHULVLQJXUEDQSRSXODWLRQVDQGFKDQJHV
LQ GLHW DQG OLIHVW\OH DUH IXHOOLQJ JURZWK LQ OLYHVWRFN SURGXFWLRQ /LYHVWRFN SURGXFWLRQ
FRQWULEXWHV WR VRFLRHFRQRPLF GHYHORSPHQW LQ PDQ\ ZD\V E\ DXJPHQWLQJ LQFRPH DQG
HPSOR\PHQW DQG UHGXFLQJ WKH LQFLGHQFH RI UXUDO SRYHUW\ 7KRXJK WKH UROH RI OLYHVWRFN LQ
HQVXULQJQXWULWLRQDOVHFXULW\LVUHFRJQLVHGLQPL[HGFURSOLYHVWRFNV\VWHPVWKHLPSRUWDQFHRI
OLYHVWRFN JRHV EH\RQG GLUHFWIRRG SURGXFWLRQ /LYHVWRFN VXSSO\ GUDXJKW SRZHU DQG RUJDQLF
PDQXUH WR WKH FURS VHFWRU DQG KLGHV VNLQV ERQHV EORRG DQG ILEUH DUH XVHG LQ PDQ\
LQGXVWULHV 7KXV OLYHVWRFN DUH DQ LPSRUWDQW VRXUFH RI LQFRPH DQG HPSOR\PHQW KHOSLQJ WR
DOOHYLDWH SRYHUW\ DQG VPRRWK WKH LQFRPH GLVWULEXWLRQ DPRQJ VPDOO ODQGKROGHUV DQG WKH
ODQGOHVV ZKLFK FRQVWLWXWH WKH EXON RI WKH UXUDO SRSXODWLRQ DQG WKH PDMRULW\ RI OLYHVWRFN
RZQHUV ,Q DGGLWLRQ OLYHVWRFN FDQ HDVLO\ EH FRQYHUWHG LQWR FDVK DQG WKXV DFW DV D FXVKLRQ
DJDLQVW FURS IDLOXUH SDUWLFXODUO\ LQ OHVV IDYRXUHG HQYLURQPHQWV %\ HQDEOLQJ FURS UHVLGXHV
DQG E\SURGXFWV WR EH XVHG DV IRGGHU OLYHVWRFN SURGXFWLRQ FRQWULEXWHV SRVLWLYHO\ WR WKH
HQYLURQPHQW$QLPDORZQHUVLQWKHGHYHORSLQJZRUOGDUHSUHGRPLQDQWO\UHVRXUFHSRRUVPDOO
VFDOH RSHUDWRUV ZLWK OLWWOH RU QR ODQG DQG IHZ DQLPDOV ZKR PXVW RSHUDWH ZLWKLQ WKH
FRQVWUDLQWVRIWKHORFDOFOLPDWHDQGZKRKDYHOLPLWHG SXUFKDVLQJ SRZHU DQG OLWWOHDFFHVV WR
UHVRXUFHVRURSSRUWXQLW\WRGHWHUPLQHUHVRXUFHDOORFDWLRQIRUDQLPDOSURGXFWLRQ7KHVLWXDWLRQ
RI WKH SRRUHVW OLYHVWRFN RZQHUV LV IDVW GHWHULRUDWLQJ RZLQJ WR WKH IUDJPHQWDWLRQ RI OLPLWHG
KROGLQJVH[KDXVWLRQRIODQGUHVRXUFHVDQGLQFUHDVLQJKXPDQDQGDQLPDOSRSXODWLRQSUHVVXUH
/RZ OLYHVWRFN SURGXFWLYLW\ LQ PDQ\ GHYHORSLQJ FRXQWULHV LV FRQVLGHUHG WR UHIOHFW DPRQJ
RWKHUWKLQJVWKHLQDGHTXDWHVXSSO\RIDQLPDOKXVEDQGU\DQGYHWHULQDU\VHUYLFHV9HWHULQDU\
VHUYLFHVKDYHWUDGLWLRQDOO\EHHQSURYLGHGE\WKH6WDWHEXWILQDQFLDOFRQVWUDLQWVKDYHOLPLWHG
WKHDYDLODELOLW\DQGHIIHFWLYHQHVVRISXEOLFVHUYLFHV7KHLPSOLFDWLRQVRIWHFKQRORJ\$PDMRU
EHQHILW RI DJULFXOWXUDO UHVHDUFK DQG WHFKQRORJ\ LV WKDW WKH SXUFKDVLQJ SRZHU RI WKH SRRU

Ϯϲϭ

LQFUHDVHV EHFDXVH ERWK DYHUDJH LQFRPHV DQG DFFHVV WR VWDSOH IRRG SURGXFWV DUH LPSURYHG
6WXGLHVE\HFRQRPLVWVKDYHSURYLGHGHPSLULFDOVXSSRUWIRUWKHSURSRVLWLRQWKDWJURZWKLQWKH
OLYHVWRFN VHFWRU DIIHFWV WKH ZKROH HFRQRP\ 5DSLG JURZWK RI OLYHVWRFN SURGXFWLRQ KDV
VWLPXODWHGGHPDQGIRUDQGLQFUHDVHGWKHYDOXHRIODQGODERXUDQGQRQDJULFXOWXUDOJRRGVDQG
VHUYLFHV WKHUHE\ OHDGLQJ WR RYHUDOO HFRQRPLF JURZWK 7KH SRRU VSHQG D UHODWLYHO\ KLJK
SURSRUWLRQRIDQ\DGGLWLRQDO LQFRPH RQ IRRG VR LQFUHDVHV LQ OLYHVWRFNSURGXFWLRQDFKLHYHG
WKURXJKWKHXVHRIELRWHFKQRORJ\FDQKDYHPDMRUQXWULWLRQDOLPSOLFDWLRQVSDUWLFXODUO\LIWKH
WHFKQRORJ\ LV DLPHG DW WKH SRRUHVW SURGXFHUV +RZHYHU VWXGLHV KDYH UHYHDOHG WKDW WKH
FRPPHUFLDOLVDWLRQ RI DJULFXOWXUH KDV UHGXFHG WKH QXWULWLRQDO VHFXULW\ RI WKH SRRU 2QFH
SURGXFWLRQ RI PLON PHDW RU HJJV KDV EHHQ HQKDQFHG WKURXJK WKH XVH RI WHFKQRORJ\ LW LV
KRSHG WKDW LW ZLOO DOVR PDNH D VLJQLILFDQW GLIIHUHQFH LQ RWKHU DUHDV VXFK DV QXWULWLRQ
SUHYHQWLRQ RI GLVHDVHV KHDOWKFDUH DQG RWKHU PDQDJHPHQW SUDFWLFHV ,W LV LQ WKHVH DUHDV WKDW
ELRWHFKQRORJ\ VKRZV SURPLVH DQG LV FXUUHQWO\ EHLQJ XVHG *UHHQ 5HYROXWLRQ WHFKQRORJLHV
LH WKRVH WHFKQRORJLHV GHVLJQHG WR LPSURYH WKH HIILFLHQF\ RI DJULFXOWXUDO SURFHVVHV DQG
LQFUHDVHFURSSURGXFWLYLW\ E\ UHO\LQJ RQ WKH H[WHQVLYH XVH RI FKHPLFDO IHUWLOL]HUVSHVWLFLGHV
DQG KHDY\ PDFKLQHU\  DUH LQWHQGHG WR EH XVHG LQ SDFNDJH IRUP HJ QHZ SODQW YDULHWLHV
VXSSOLHGZLWKUHFRPPHQGDWLRQVRQIHUWLOL]HUSHVWLFLGHDQGKHUELFLGHUDWHVDQGZDWHUFRQWURO
PHDVXUHV  KRZHYHU DPRQJ OLYHVWRFN SURGXFHUV PDQ\ FRPSRQHQWV RI WKHVH WHFKQRORJLHV
KDYH EHHQ WDNHQ XS LQ D SLHFHPHDO RIWHQ VWHSZLVH PDQQHU 7KH VHTXHQFH RI DGRSWLRQ LV
GHWHUPLQHGE\DYDLODELOLW\DQGE\WKHSRWHQWLDOFRVWVDYLQJV7KHVHTXHQWLDODGRSWLRQVRIFURS
PDQDJHPHQW WHFKQRORJLHV IRU ULFH DQG ZKHDW KDYH EHHQ DVVHVVHG LQ GHWDLO EXW IHZ VLPLODU
VWXGLHV KDYH IRFXVVHG RQ OLYHVWRFN SURGXFWLRQ LQ GHYHORSLQJ FRXQWULHV  (YLGHQFH IURP WKH
3HRSOH¶V5HSXEOLFRI&KLQD0H[LFR6RXWK$IULFDDQG,QGLDVXJJHVWVWKDWVPDOOIDUPHUVKDYH
KDG QR PRUH GLIILFXOW\ WKDQ ODUJHU IDUPHUV LQ DGRSWLQJ WKH QHZ WHFKQRORJLHV 7KH TXHVWLRQ
WKHUHIRUH LV QRW ZKHWKHU ELRWHFKQRORJ\ FDQ EHQHILW VPDOOVFDOH UHVRXUFHSRRU IDUPHUV EXW
UDWKHU KRZ ELRWHFKQRORJ\ FDQ DGGUHVV WKH DJULFXOWXUDO SUREOHPV IDFHG E\ IDUPHUV LQ
GHYHORSLQJFRXQWULHV%LRWHFKQRORJ\LVDSURPLVLQJQHZ WRROLQWKHGHYHORSPHQWRIDSSOLHG
DJULFXOWXUDO WHFKQRORJLHV 7KH FKDOOHQJH LV WR IRFXV WKLV SRWHQWLDO RQ WKH SUREOHPV
H[SHULHQFHGE\GHYHORSLQJ FRXQWULHV 7KHLQWURGXFWLRQ RI PXOWLHQWHUSULVHV\VWHPVRUPRUH
EURDGO\ DJULFXOWXUDO GLYHUVLILFDWLRQ LV VHHQ DV WKH ZD\ IRUZDUG IRU DJULFXOWXUH LQ WKH
GHYHORSLQJZRUOGVXFKV\VWHPVFRXOGOLIWVPDOOVFDOHDQGPDUJLQDO IDUPHUV RXW RI SRYHUW\
)RU H[DPSOH URWDWLQJ ULFH DQG ZKHDW FURSSLQJ ZLWK GDLU\ IDUPLQJ \LHOGV KLJKHU SURILWV
,QWURGXFLQJ PXOWLHQWHUSULVH V\VWHPV LQYROYLQJ OLYHVWRFN HQKDQFHV WKH SXUFKDVLQJ SRZHU RI
IDUPHUVDQGKHOSVWKHPWRREWDLQQXWULWLRQDOVHFXULW\,WDOVRJHQHUDWHVUXUDO ERWKIDUPLQJDQG
QRQIDUPLQJ  HPSOR\PHQW WKXV SUHYHQWLQJ H[FHVVLYH PLJUDWLRQ WR XUEDQ DUHDV ZKLFK LV D
FRPPRQSUREOHPLQGHYHORSLQJHFRQRPLHV0XOWLHQWHUSULVHV\VWHPVDOVRVXSSRUWWKHQDWXUDO
HQYLURQPHQWDQGFRQWULEXWHWRFDSLWDOIRUPDWLRQWKXVOHDGLQJWRKLJKHURYHUDOOJURZWKLQWKH
DJULFXOWXUDOHFRQRP\7KHWHFKQRORJ\LQIUDVWUXFWXUHDQGLQVWLWXWLRQVQRZH[LVWWRPDNHWKH
DSSOLFDWLRQRIELRWHFKQRORJ\ LQ WKHFRQWH[WRIDPXOWLHQWHUSULVHV\VWHPLQYROYLQJOLYHVWRFN
SURGXFWLRQHFRQRPLFDOO\YLDEOH

*OREDODGYDQWDJHIURPOLYHVWRFNRIGHYHORSLQJ&RXQWULHV

7KHPXOWLSOLFLW\RIJHQHVVSHFLHVSRSXODWLRQVDQGDJURHFRV\VWHPVLQWKHGHYHORSLQJ
FRXQWULHV RI 6RXWK DQG 6RXWK (DVW $VLD WKH 3HRSOH¶V 5HSXEOLF RI &KLQD $IULFD DQG /DWLQ
$PHULFD LV YLHZHG DV D YDOXDEOH UHVRXUFH IRU WKH JHQHWLF LPSURYHPHQW RI OLYHVWRFN RQ D
JOREDO VFDOH 7KH OLYHVWRFN LQ WKHVH FRXQWULHV ZKLFK DUH DQ LQWHJUDO SDUW RI D IUDJLOH
HFRV\VWHPDUHDULFKVRXUFHRIDQLPDOELRGLYHUVLW\%XIIDORHVVKHHSJRDWVFDPHOVDQG]HEX
FDWWOHKDYHDGDSWHGWRWKHLUUHJLRQDOHQYLURQPHQWVRYHUWKRXVDQGVRI\HDUVDQGKDYHSURYLGHG
DQLPSRUWDQWVRXUFHRIVXVWHQDQFHIRUWKHSRSXODWLRQRIWKHUHJLRQ/LYHVWRFNSURGXFWLRQLQ

ϮϲϮ

WKH GHYHORSLQJ ZRUOG KDV D QXPEHU RI DGYDQWDJHV RYHU SURGXFWLRQ LQ PRUH GHYHORSHG
FRXQWULHVIRUH[DPSOH

x WKHXQLTXHDQGYDOXDEOHSURGXFWLRQWUDLWVRIEXIIDORHVFDWWOHVKHHSJRDWVDQGFDPHOV
x WKHORZLQSXWSURGXFWLRQV\VWHP
x WKHORZXQLWFRVWRISURGXFWLRQ
x WKHOHDQPHDWSURGXFHGIURPVKHHSJRDWVDQGEXIIDORHV
x WKHFRQVLGHUDEOHELRGLYHUVLW\
x DQLPDOEUHHGVWKDWDUHUHVLVWDQWWRVWUHVVDQGWRSDUWLFXODUGLVHDVHV
x WKHDELOLW\RIWKHDQLPDOVWRVXUYLYHRQKLJKURXJKDJHIHHGV
x WKHSRWHQWLDOIRUELRSKDUPDFHXWLFDOGHYHORSPHQWVWROHDGWRVLJQLILFDQWEHQHILWV
x WKHSRWHQWLDOIRUH[SDQGLQJWKHPLFURELDOIRRGIHHGDQGOHDWKHULQGXVWULHV
x WKHLQWHJUDWHGSURGXFWLRQV\VWHPWDLORUHGWRWKHORFDOHFRORJ\
x WKHSRWHQWLDOIRULQWHJUDWLQJNQRZOHGJHDQGLQGXVWU\

6HYHUDO JHQHV DQG GHVLUDEOH WUDLWV KDYH EHHQ LGHQWLILHG LQ WKH OLYHVWRFN RI GHYHORSLQJ
FRXQWULHV LQ $VLD DQG $IULFD DQG VRPH RI WKH OLYHVWRFN VSHFLHV DQG EUHHGV IURP WKHVH
FRXQWULHV KDYH EHFRPHPDMRU FRQWULEXWRUV WR WKH HFRQRP\ RI 6RXWK $PHULFD ([DPSOHV RI
EUHHGVIURPWKHGHYHORSLQJZRUOGWKDWDUHSDUWLFXODUO\LPSRUWDQWRQDJOREDOOHYHODUH

x %XIIDORHV WKDW SURGXFH PLON ZLWK D KLJK IDW FRQWHQW RU ZLWK WKH SURWHLQ TXDOLW\
UHTXLUHGWRSURGXFHPR]]DUHOODFKHHVH
x *RDWVIURPFROGGU\UHJLRQV WKDWSURGXFHSDVKPLQD DQGWRRV WKHILQHVWZRROLQ WKH
ZRUOG 
x %ODFN%HQJDOJRDWVWKDWFDUU\DJHQHIRUKLJKSUROLILFDF\
x *DUROHVKHHSWKDWFDUU\JHQHVIRUWZLQQLQJ
x $QGDPDQJRDWVWKDWLVKLJKO\WROHUDQWRIVDOW
x 7KH\DNDQGPLWKXQWKDWDUHDGDSWHGWRKLJKDOWLWXGH
x 7KHFDPHOVVKHHSDQGJRDWVWKDWDUHDGDSWHGWRDWURSLFDODULGHQYLURQPHQWDQGFDQ
WROHUDWHIHHGZLWKDKLJKOLJQLQFRQWHQW
x 7KHPDQ\VSHFLHVWKRVHDUHUHVLVWDQWWRVWUHVVRUWRSDUWLFXODUGLVHDVHV

(FRQRPLFLPSDFWRIWHFKQRORJLHV

7KH JHQHWLF UHVRXUFHV SRVVHVVHG E\ DQLPDOV LQ GHYHORSLQJ FRXQWULHV RIWHQ DIIHFW
HFRQRPLF GHYHORSPHQW 7KH HFRQRPLF LPSDFWV RI ELRWHFKQRORJLFDO LQQRYDWLRQV EXW WKH
UHVHDUFKDQGSROLF\RSWLRQVQHHGVHSDUDWHFRQVLGHUDWLRQ$QLPDOELRWHFKQRORJ\LVWKHUHVXOW
RIDPXOWLVWDJHSURFHVVLQYROYLQJUHVHDUFKGHYHORSPHQWWHVWLQJDQGUHJLVWUDWLRQSURGXFWLRQ
DQG PDUNHWLQJ 7KH JRDO LV WR GHYHORS D WHFKQRORJ\ SURFHVV RU SURGXFW WKDW KDV FOHDU
FRPPHUFLDO SRWHQWLDO DQG FDQ EH FRPPHUFLDOLVHG DIWHU GXH WHVWLQJ DQG UHJXODWRU\ DSSURYDO
'HYHORSLQJ FRXQWULHV ILQG LW GLIILFXOW WR GHYHORS ELRWHFKQRORJ\ EHFDXVH WKH IDFLOLWLHV RU
UHVRXUFHV QHHGHG WR FRPSOHWH DOO RI WKH VWDJHV LQ WKH SURFHVV DUH RIWHQ ODFNLQJ +RZHYHU
VHYHUDOWHFKQRORJLHVIURPGHYHORSHGFRXQWULHVKDYHEHHQVXFFHVVIXOO\DGRSWHGE\GHYHORSLQJ
FRXQWULHV7KHLPSDFWRIWHFKQRORJ\FDQEHDQDO\VHGE\HVWLPDWLQJWKHJURZWKRIWRWDOIDFWRU
SURGXFWLYLW\ 7)3  LQ OLYHVWRFN SURGXFWLRQ 1RW PDQ\ 7)3 VWXGLHV RQ OLYHVWRFN KDYH EHHQ
UHSRUWHG+RZHYHUVHSDUDWH7)3HVWLPDWHVIRUWKHDJJUHJDWHFURSDQGOLYHVWRFNVHFWRUVKDYH
EHHQ PDGH 7)3 DQDO\VLV KDV VKRZQ D VKLIW WRZDUGV ODUJHU PRUH FRPPHUFLDO DQG PRUH
LQWHQVLYH SURGXFWLRQ V\VWHPV DQG KDV IXUWKHU UHYHDOHG WKDW DV VSHFLDOLVDWLRQ KDV GHYHORSHG
RYHUWKHSDVWGHFDGHWKHLPSRUWDQFH RIEDFN\DUGOLYHVWRFNSURGXFWLRQKDVGHFOLQHGDQGWKH

Ϯϲϯ

LPSRUWDQFHRIVSHFLDOLVHGKRXVHKROGDQGFRPPHUFLDOHQWHUSULVHKDVLQFUHDVHG6WXGLHVIURP
,QGLDKDYHVKRZQWKDWWHFKQRORJLFDOLQSXWLVUHVSRQVLEOHIRUDERXWRIWRWDORXWSXWJURZWK
DQGWKDWWKH7)3JURZWKPD\EHDVPXFKDV

7HFKQRORJLHV WKDW KDYH D VSHFLILF LPSDFW LQ GHYHORSLQJ FRXQWULHV 7KHUH DUH D ODUJH
QXPEHU RI WHFKQRORJLHV WKDW KDYH EHHQ GHYHORSHG IRU RU DGDSWHG WR WKH OLYHVWRFN RI ERWK
GHYHORSHG DQG GHYHORSLQJ FRXQWULHV +RZHYHU WKH PDMRU WHFKQRORJLHV WKDW DUH XVHG
HIIHFWLYHO\LQOLYHVWRFNSURGXFWLRQLQWKHGHYHORSLQJZRUOGLQFOXGHFRQVHUYLQJDQLPDOJHQHWLF
UHVRXUFHV DXJPHQWLQJ UHSURGXFWLRQ HPEU\R WUDQVIHU (7  DQG UHODWHG WHFKQRORJLHV
GLDJQRVLQJGLVHDVHDQGFRQWUROOLQJDQGLPSURYLQJQXWULHQWDYDLODELOLW\

7UDQVJHQLFV

$OWKRXJK JHQHEDVHG WHFKQRORJLHV KDYH WKH SRWHQWLDO WR LPSURYH WKH HIILFLHQF\ RI
OLYHVWRFNSURGXFWLRQWKHUHE\HQVXULQJEHWWHUUHWXUQVIRUWKHIDUPHUVWKHHFRQRPLFLPSDFWRI
WUDQVJHQLFV LQ WKH OLYHVWRFN VHFWRU ZLOO EH PXFK OHVV WKDQ LQ WKH FURS VHFWRU +RZHYHU WKH
JOREDO DGRSWLRQ RI JHQHWLFDOO\ PRGLILHG *0  FURSV ZKLFK ZHUH JURZQ RQ  PLOOLRQ
KHFWDUHVLQFRPSDUHGZLWKPLOOLRQKHFWDUHVLQKDVKDGDVXEVWDQWLDOLPSDFWRQ
OLYHVWRFNIHHG,WLVHVWLPDWHGWKDWWKH8QLWHG6WDWHVRI$PHULFD 86$ $UJHQWLQD&DQDGD
%UD]LODQGWKH3HRSOH¶V5HSXEOLFRI&KLQDKDYHDQGUHVSHFWLYHO\RI
WKH JOREDO WUDQVJHQLF DFUHDJH DQG WKDW WKH PRVW IUHTXHQWO\ JURZQ FURSV DUH *0 VR\EHDQ
 PDL]H  FRWWRQ  DQGFDQROD  $OWKRXJKIHZGHYHORSLQJFRXQWULHVKDYH
UHOHDVHG *0 FURS YDULHWLHV D SUHOLPLQDU\ DQDO\VLV UHYHDOV WKDW PRUH WKDQ  GHYHORSLQJ
FRXQWULHV DUH FRQGXFWLQJ UHVHDUFK LQWR WKH DSSOLFDWLRQV RI *0 FURSV $OWKRXJK WUDQVJHQLF
DQLPDOV HVSHFLDOO\PLFH DUHXVHGURXWLQHO\LQUHVHDUFK SDUWLFXODUO\LQWKHPHGLFDOILHOG QR
*0DQLPDOVKDYH\HWEHHQUHOHDVHGRQIDUPV$ZLGHUDQJHRIWUDLWVRISRWHQWLDOLQWHUHVWWR
OLYHVWRFN SURGXFHUV KDYH KRZHYHU EHHQ WKH VXEMHFW RI UHVHDUFK IRU H[DPSOH WKH JHQH
UHVSRQVLEOHIRUWKHSURGXFWLRQ RIJURZWKKRUPRQH ZKLFKFRXOGEHPDQLSXODWHG WRLQFUHDVH
JURZWKUDWHV WKHSK\WDVHJHQH ZKLFKFRXOGUHGXFHSKRVSKRURXVHPLVVLRQVIURPSLJV DQG
NHUDWLQJHQHV ZKLFKFRXOGLPSURYHWKHZRRORIVKHHS 7KHJHQHWLFPRGLILFDWLRQRIOLYHVWRFN
KDV SURFHHGHG PXFK PRUH VORZO\ WKDQ WKH JHQHWLF PRGLILFDWLRQ RI FURSV IRU D YDULHW\ RI
UHDVRQVLQFOXGLQJWKHKLJKFRVWVWKHLQHIILFLHQF\RIWKHJHQHWUDQVIHUWHFKQLTXHVDQGWKHORZ
UHSURGXFWLYH UDWHV RI DQLPDOV 5HFRPELQDQW GHR[\ULERQXFOHLF DFLG '1$  DSSURDFKHV KDYH
EHHQ XVHG WR SURPRWH WKH H[SUHVVLRQ RI GHVLUDEOH JHQHV WR KLQGHU WKH H[SUHVVLRQ RI
XQGHVLUDEOH JHQHV WR DOWHU VSHFLILF JHQHV DQG WR LQDFWLYDWH JHQHV VR DV WR EORFN VSHFLILF
SDWKZD\V ,W LV HVWLPDWHG WKDW DW OHDVW  HQ]\PHV SURGXFHG E\ *0 EDFWHULD \HDVWV DQG
PRXOGVDUHFXUUHQWO\FRPPHUFLDOO\DYDLODEOHZRUOGZLGHPDQ\RIWKHVHHQ]\PHVDUHXVHGLQ
WKH IRRG LQGXVWU\ *HQHWLF HQJLQHHULQJ KDV EHHQ XVHG WR LQWURGXFH IRUHLJQ JHQHV LQWR WKH
DQLPDOJHQRPHRUDOWHUQDWLYHO\WRNQRFNRXWVHOHFWHGJHQHV*HQHVFRQWUROOLQJJURZWKZHUH
LQWURGXFHG LQWR SLJV WR LQFUHDVH JURZWK DQG LPSURYH FDUFDVV TXDOLW\ &XUUHQWO\ UHVHDUFK LV
XQGHUZD\ WR HQJLQHHU UHVLVWDQFH WR GLVHDVHV WKDW DIIHFW WKH DQLPDOV RU WKDW SRVH DQ LQGLUHFW
ULVNWRKXPDQKHDOWKVXFKDV0DUHN¶VGLVHDVHDQGVDOPRQHOORVLVLQSRXOWU\VFUDSLHLQVKHHS
DQG PDVWLWLV LQ FDWWOH 2WKHU VWXGLHV KDYH WULHG WR LQFUHDVH WKH FDVHLQ FRQWHQW RI PLON RU WR
HQJLQHHUDQLPDOVWKDWSURGXFHSKDUPDFHXWLFDORULQGXVWULDOFKHPLFDOVLQWKHLUPLONRUVHPHQ
1RDJULFXOWXUDODSSOLFDWLRQVKDYH\HWSURYHGFRPPHUFLDOO\VXFFHVVIXO1XFOHDUWUDQVIHU 17 
WHFKQRORJ\QRZSURYLGHVDQDOWHUQDWLYHURXWHIRUFHOOEDVHGWUDQVJHQHVLVLQGRPHVWLFVSHFLHV
RIIHULQJ QHZ RSSRUWXQLWLHV IRU JHQHWLF PRGLILFDWLRQ /LYHVWRFN WKDW SURGXFH KXPDQ
WKHUDSHXWLFSURWHLQVLQWKHLUPLONWKDWKDYHRUJDQVVXLWDEOHIRU[HQRWUDQVSODQWDWLRQDQGWKDW
DUH UHVLVWDQW WR GLVHDVHV VXFK DV VSRQJLIRUP HQFHSKDORSDWKLHV KDYH EHHQ SURGXFHG E\ 17
IURPHQJLQHHUHGFXOWXUHGVRPDWLFFHOOV

Ϯϲϰ

 
&KDUDFWHULVLQJJHQHWLFYDULDELOLW\

7KHUHLVFRQVLGHUDEOHJHQHWLFGLYHUVLW\LQWKHOLYHVWRFNRIGHYHORSLQJFRXQWULHVPXFK
RI ZKLFK FRQWUROV WUDLWV WKDW LQIOXHQFH DGDSWDELOLW\ WR KDUVK HQYLURQPHQWV SURGXFWLYLW\ DQG
VXVFHSWLELOLW\WRGLVHDVHDQGSDUDVLWLVP+RZHYHUOLWWOHLIDQ\GDWDRQWKHVHJHQHWLFUHVRXUFHV
DUHDYDLODEOH

(FRQRPLFDQDO\VLVFDQSOD\DQLPSRUWDQWUROHLQHQVXULQJWKDWFRQVHUYDWLRQHIIRUWVDUH
DSSURSULDWHO\ IRFXVHG 7KH SULPDU\ FKDOOHQJH IDFLQJ FRQVHUYDWLRQLVWV LV WR LGHQWLI\ VRXQG
UHDVRQVZK\VRFLHW\VKRXOGSUHVHUYHDQLPDOVWKDWOLYHVWRFNNHHSHUVKDYHDEDQGRQHG-DEEDU
DQG'LHGKLRXVKRZWKDWWKHEUHHGLQJSUDFWLFHVDQGEUHHGSUHIHUHQFHVRIOLYHVWRFNNHHSHUVFDQ
VXFFHVVIXOO\ EH GHWHUPLQHG E\ XVLQJ UHVHDUFK WHFKQLTXHV VXFK DV WKH UHYHDOHG SUHIHUHQFH
KHGRQLFDSSURDFK2QWKHRQHKDQGFRQVHUYDWLRQFDQQRWEHDFKLHYHGWKURXJKDFRQYHQWLRQDO
EUHHGLQJ SURJUDPPH EHFDXVH WKH DQLPDOV FDUU\LQJ WKH PRVW DGYDQWDJHRXV WUDLWV FDQQRW EH
HDVLO\ LGHQWLILHG &RQYHUVHO\ FRQVHUYDWLRQ FDQQRW EH DFKLHYHG WKURXJK ELRWHFKQRORJ\
EHFDXVH WKH QHFHVVDU\ WHFKQRORJLHV DUH HLWKHU XQDYDLODEOH RU XQHFRQRPLF ,Q OLYHVWRFN
SRSXODWLRQVZLWKDKLJKGHJUHHRIJHQHWLFYDULDWLRQPROHFXODUPDUNHUVDUHEHLQJLQFUHDVLQJO\
XVHGWRVWXG\WKHGLVWULEXWLRQDQGSDWWHUQVRIJHQHWLFGLYHUVLW\*OREDOVXUYH\VLQGLFDWHWKDW
 RI GRPHVWLF OLYHVWRFN EUHHGV DUH DW ULVN RI H[WLQFWLRQ 0RVW RI WKHVH EUHHGV DUHIRXQG
RQO\LQGHYHORSLQJ FRXQWULHV DQG RIWHQ OLWWOH LV NQRZQDERXWWKHPRUWKHLUSRWHQWLDO5DSLG
SURJUHVVLVEHLQJPDGHLQWKHSUHSDUDWLRQRIGHQVHPLFURVDWHOOLWHOLQNDJHPDSVWRDVVLVWLQWKH
VHDUFKIRUJHQHWLFWUDLWVRIHFRQRPLFLPSRUWDQFH7KHVHOLQNDJHPDSVFDQEHXVHGWRGHYHORS
VWUDWHJLHVIRU PDUNHUDVVLVWHG VHOHFWLRQDQG PDUNHU DVVLVWHG LQWURJUHVVLRQ WKDW ZLOO PHHW WKH
JRDOVRIEUHHGLQJSURJUDPPHVLQGHYHORSLQJFRXQWULHV0ROHFXODUPDUNHUVKDYHEHHQZLGHO\
XVHG LQ WKH LGHQWLILFDWLRQ RI JHQRW\SHV DQG WKH µJHQHWLF ILQJHUSULQWLQJ¶ RI RUJDQLVPV
*HQRW\SHYHULILFDWLRQLVXVHGLQWHQVLYHO\WRGHWHUPLQHWKHSDUHQWDJHRIGRPHVWLFDQLPDOVDQG
WRWUDFHOLYHVWRFNSURGXFWVLQWKHIRRGFKDLQEDFNWRWKHIDUPDQGDQLPDORIRULJLQ

5HSURGXFWLYHWHFKQRORJLHV

7KHPDLQREMHFWLYHVRIXVLQJUHSURGXFWLYHELRWHFKQRORJLHVLQOLYHVWRFNDUHWRLQFUHDVH
SURGXFWLRQUHSURGXFWLYHHIILFLHQF\DQGUDWHVRIJHQHWLFLPSURYHPHQW2YHUWKH\HDUVPDQ\
RSWLRQV KDYH EHFRPH DYDLODEOH IRU PDQDJLQJ WKH UHSURGXFWLRQ RI WKHPDMRU ODUJH DQG VPDOO
UXPLQDQWV$UWLILFLDOLQVHPLQDWLRQ $, DQGSUHVHUYDWLRQRIVHPHQDUHWKHPDLQWHFKQRORJLHV
WKDW DUH XVHG H[WHQVLYHO\ $VVHVVLQJ WKH IHUWLOLVDWLRQ FDSDFLW\ RI VSHUPV VH[LQJ VSHUPV
V\QFKURQLVDWLRQ DQG IL[HGWLPH LQVHPLQDWLRQ VXSHURYXODWLRQ HPEU\R WUDQVIHU (7  DQG LQ
YLWUR HPEU\R SURGXFWLRQ ,9(3  DUH DGGLWLRQDO WHFKQLTXHV WKDW FDQ LPSURYH UHSURGXFWLYH
HIILFLHQF\ DQG SUHJQDQF\ UDWHV 5HSURGXFWLYH WHFKQRORJLHV FDQ DOVR EH XVHG WR FRQWURO
UHSURGXFWLYHGLVHDVHVLISURFHGXUHVDQGSURWRFROVDUHDFFXUDWHO\IROORZHG

$UWLILFLDOLQVHPLQDWLRQ

7KHFRQFHSWLRQ UDWH LQ ILHOG $, SURJUDPPHV LQGHYHORSLQJ FRXQWULHV LVYHU\ ORZDQG
WKHUHIRUH WKH GHVLUHG HIIHFW LQ WHUPV RI DQLPDO LPSURYHPHQW KDV QRW EHHQ DFKLHYHG 0RVW
VHPHQ EDQNV VWLOO HYDOXDWH VHPHQ RQ WKH EDVLV RI VSHUP PRWLOLW\ HYHQ WKRXJK VLJQLILFDQW
DGYDQFHVKDYHEHHQPDGHLQWHFKQLTXHVIRUVHPHQHYDOXDWLRQ$OWKRXJKGHWDLOHGJXLGHOLQHV
DUH DYDLODEOH UHJDUGLQJ WKH SURFHVVLQJ VWRUDJH DQG WKDZLQJ RI FDWWOH VHPHQ DQG EXIIDOR
VHPHQ WKH SURFHVVLQJ DQG KDQGOLQJ SURFHGXUHV LQ ODERUDWRULHV SURFHVVLQJ VHPHQ DUH RIWHQ
LQDGHTXDWH 2QO\ ZKHQ IDUPHUV KDYH DFFHVV WR FRQVLGHUDEO\ EHWWHU WHFKQLFDO DQG

Ϯϲϱ

RUJDQLVDWLRQDO IDFLOLWLHV ZLOO $, EHFRPH PRUH HIIHFWLYH $W SUHVHQW WKH HIILFLHQF\ RI WKH
WHFKQRORJ\LVOLPLWHGE\RUJDQLVDWLRQDODQGORJLVWLFDOFRQVWUDLQWVDQGE\WKHIDLOXUHWRSURYLGH
DSSURSULDWHWUDLQLQJIRUIDUPHUV6HYHUDOPRGLILFDWLRQVRIWKHWHFKQLTXHKDYHEHHQVXJJHVWHG
WR LQFUHDVH WKH FRQFHSWLRQ UDWH 6\QFKURQLVDWLRQ ZLWK GLIIHUHQW FRPSRXQGV DQG WKH XVH RI
JRQDGRWURSLQUHOHDVLQJ KRUPRQH *Q5+  IROORZHG VHYHQ GD\V ODWHU E\ SURVWDJODQGLQ )Į
3*)Į  FDQ V\QFKURQLVH RHVWUXV DQG LPSURYHV WKH FRQFHSWLRQ UDWH ,Q WKLV SURWRFRO JLYLQJ
LQMHFWLRQVRI*Q5+RQGD\3*)ĮRQGD\DQG*Q5+RQGD\LVFDOOHGWKHµ2YV\QFK¶
SURJUDPPHDQGV\QFKURQLVHVRYXODWLRQSHUPLWWLQJWLPHGLQVHPLQDWLRQ7KHDELOLW\WRFRQWURO
RYDULDQ IROOLFXODU DQG FRUSXV OXWHXP GHYHORSPHQW KDV DOORZHG LQVHPLQDWLRQ LQ FDWWOH WR EH
WLPHGZLWKRXWKDYLQJWRGHWHFWRHVWUXVDQGWKLVKDVLQFUHDVHGWKHQHWUHYHQXHSHUFRZ

(PEU\RWUDQVIHU

2QHRIWKHPDMRUUHSURGXFWLYHWHFKQRORJLHV WKDWFDQIDFLOLWDWHJHQHWLFLPSURYHPHQWLQ
FDWWOHLV(78QIRUWXQDWHO\FRPPHUFLDO(7SURJUDPPHVDUHOLPLWHGE\WKHKLJKYDULDELOLW\LQ
WKH RYDULDQ IROOLFXODU UHVSRQVH WR JRQDGRWURSLQ VWLPXODWLRQ 0XOWLSOH RYXODWLRQ DQG HPEU\R
WUDQVIHU 02(7 WDNHV$,RQHVWHSIXUWKHULQWHUPVRIERWKWKHSRVVLEOHJHQHWLFJDLQVDQGWKH
OHYHO RI WHFKQLFDO H[SHUWLVH DQG RUJDQLVDWLRQ UHTXLUHG ,Q   HPEU\RV ZHUH
WUDQVIHUUHGJOREDOO\PDLQO\LQGDLU\FDWWOHZLWKEHLQJWUDQVIHUUHGLQ1RUWK$PHULFDDQG
(XURSHLQ6RXWK$PHULFDDQGLQ$VLD7KHPDLQSRWHQWLDODGYDQWDJHRI02(7IRU
GHYHORSLQJFRXQWULHVLVWKDWWKHHOLWHIHPDOHVRIORFDOEUHHGVFDQEHLGHQWLILHGDQGEXOOVFDQ
EHSURGXFHGIURPWKHPIRUXVHLQDILHOGSURJUDPPHRIEUHHGLPSURYHPHQW=HEXFDWWOHDQG
EXIIDORHV LQ GHYHORSLQJ FRXQWULHV H[KLELW OHVV FRQVLVWHQW IROOLFXODU G\QDPLFV DIWHU
VXSHURYXODWLRQWKDQ%RVWDXUXVLQWKHGHYHORSHGZRUOG+RZHYHURYHUWKHODVWWR\HDUV
WKHQXPEHURIWUDQVIHUDEOHHPEU\RVSURGXFHGE\]HEXGRQRUVKDVLQFUHDVHGIURPWR
HPEU\RVSHUIOXVKLQWKHODWHVWRWRHPEU\RVSHUIOXVKLQ7KHXVHRI(7
KDVEHHQOHVVVXFFHVVIXOWKDQHQYLVDJHGIRUVHYHUDOUHDVRQV7KHORZUHSURGXFWLYHHIILFLHQF\
SRRUVXSHURYXODWRU\UHVSRQVHVYHU\ORZSULPRUGLDOIROOLFOHSRSXODWLRQDQGKLJKLQFLGHQFHRI
DWUHVLDDOOFRQWULEXWHWRORZHPEU\RSURGXFWLRQ,QEXIIDORHVHPEU\RUHFRYHU\ZDVLQLWLDOO\
OHVVWKDQRQHEXWKDVVXEVHTXHQWO\LPSURYHGWRZLWKWUDQVIHUDEOHHPEU\RVSHUIOXVK
$IWHUWUDQVIHUULQJEXIIDORHPEU\RVWRUHFLSLHQWVWKHFRQFHSWLRQUDWH LV RQO\ 7KH SRRU
VXFFHVV UDWHV KDYH OLPLWHG WKH XVH RI (7 LQ EXIIDORHV ZKLFK DUH WKHPDLQGDLU\ DQLPDOV LQ
GHYHORSLQJ FRXQWULHV LQ $VLD 6RXWK(DVW $VLD DQG WKH 0HGLWHUUDQHDQ UHJLRQ ,Q YLWUR
SURGXFWLRQ RI HPEU\RV VLQFH WKH ELUWK RI WKH ILUVW EXIIDOR FDOI IURP DQ LQ YLWUR IHUWLOLVHG
RRF\WHDQXPEHURISXEOLFDWLRQVKDYHGHVFULEHGWKHHIIHFWVRIGLIIHUHQWSURWRFROVDQGPHGLD
RQ RRF\WH DQG HPEU\R GHYHORSPHQW 7ZR H[WHQVLYH UHYLHZV KDYH EHHQ SXEOLVKHG UHFHQWO\
+RZHYHUWKHSUDFWLFDOXVHRI,9(3LVOLPLWHGE\KLJKSURGXFWLRQFRVWVDQGWKHORZRYHUDOO
HIILFLHQF\XQGHUILHOGFRQGLWLRQV+LJKUDWHVRIPDWXUDWLRQ WR IHUWLOLVDWLRQ 
WR DQGFOHDYDJH WR DQGPRGHUDWHWRORZUDWHVRIEODVWRF\VWIRUPDWLRQ 
WR   DQG FDOI SURGXFWLRQ   KDYH EHHQ UHSRUWHG 7KH HIILFLHQF\ RI EODVWRF\VW
SURGXFWLRQ LQ EXIIDORHV LV PXFK SRRUHU WKDQ WKH WR  UHSRUWHG IRU FDWWOH $OWKRXJK
YLDEOHEXIIDOREODVWRF\VWVKDYHEHHQSURGXFHGIURPRYDULHVREWDLQHGIURPDEDWWRLUVWKH\LHOG
RI WUDQVIHUDEOH HPEU\RV UHPDLQV ORZ  WR   (PEU\RV SURGXFHG LQ YLWUR KDYH OHG
VXFFHVVIXOO\ WR SUHJQDQF\ DQG FDOI ELUWK LQ EXIIDOR EXW WKH VXFFHVV UDWH LV ORZ 7KHUHIRUH
,9(3 PXVW EH LPSURYHG EHIRUH LW FDQ EH ZLGHO\ XVHG LQ FDWWOH DQG EXIIDORHV LQ GHYHORSLQJ
FRXQWULHV

,PSURYLQJKHDOWKWKURXJKGHYHORSLQJYDFFLQHV


Ϯϲϲ

 0RVW ELRWHFKQRORJLHV UHODWHG WR KHDOWK IRFXV RQ WKH QHHGV RI WKH GHYHORSHG ZRUOG
PHDQLQJWKDWRIKHDOWKUHVHDUFKLVGHYRWHGWRWKHKHDOWKSUREOHPVRIRIWKHZRUOG¶V
SRSXODWLRQ 7ZR PDLQ DSSURDFKHV DUH EHLQJ XVHG WR GHYHORS YDFFLQHV XVLQJ UHFRPELQDQW
'1$ WHFKQRORJ\ 7KH ILUVW LQYROYHV GHOHWLQJ JHQHV WKDW GHWHUPLQH WKH YLUXOHQFH RI WKH
SDWKRJHQ WKXV SURGXFLQJ DWWHQXDWHG RUJDQLVPV QRQSDWKRJHQV  WKDW FDQ EH XVHG DV OLYH
YDFFLQHV &XUUHQWO\ WKLV VWUDWHJ\ LV PRUH HIIHFWLYH DJDLQVW YLUDO DQG EDFWHULDO GLVHDVHV WKDQ
DJDLQVW SDUDVLWHV $WWHQXDWHG OLYH YDFFLQHV KDYH EHHQ GHYHORSHG DJDLQVW WKH KHUSHV YLUXVHV
WKDWFDXVHSVHXGRUDELHV LQ SLJV DQGLQIHFWLRXV ERYLQHUKLQRWUDFKHLWLVLQFDWWOH$QXPEHURI
FDQGLGDWH6DOPRQHOODYDFFLQHVKDYHDOVREHHQSURGXFHG7KHVHFRQGDSSURDFKLVWRLGHQWLI\
SURWHLQ VXEXQLWV RI SDWKRJHQV WKDW FDQ VWLPXODWH LPPXQLW\ 7KH ,QWHUQDWLRQDO /LYHVWRFN
5HVHDUFK,QVWLWXWH ,/5, XVHGWKLVDSSURDFKWRGHYHORSDYDFFLQHDJDLQVW7KHLOHULDSDUYDWKH
SDUDVLWH WKDW FDXVHV (DVW &RDVW IHYHU LQ $IULFDQ FDWWOH $ QRYHO VWUDWHJ\ IRU GHYHORSLQJ
YDFFLQHV DJDLQVW EORRGVXFNLQJ SDUDVLWHV LQYROYHV XVLQJ FRPSRQHQWV RI WKH JXW ZDOO RI WKH
SDUDVLWH WKDW DUH QRW XVXDOO\ H[SRVHG WR WKH LPPXQH V\VWHP RI WKH KRVW :KHQ WKH SDUDVLWH
IHHGV LW LQJHVWV DQWLERGLHV LQGXFHG E\ WKH YDFFLQH ZKLFK GHVWUR\ WKH JXW ZDOO DQG
FRQVHTXHQWO\NLOOWKHSDUDVLWH7KLVVWUDWHJ\KDVEHHQXVHGVXFFHVVIXOO\WRGHYHORSDYDFFLQH
DJDLQVWWKHRQHKRVWWLFN%RRSKLOXVPLFURSOXV9DFFLQDWLRQLVRQHRIWKHPRVWHIIHFWLYHDQG
VXVWDLQDEOHPHWKRGVRIFRQWUROOLQJGLVHDVH9DFFLQHVDJDLQVWSDUDVLWLFGLVHDVHVLQ$IULFDDQG
YLUDOGLVHDVHVLQ$VLDKDYHEHHQVKRZQWRFRQWUROGLVHDVHHIIHFWLYHO\DQGLQFUHDVHOLYHVWRFN
SURGXFWLYLW\$UHFHQWDSSURDFKKDVEHHQWRXVHYDFFLQHVEDVHGRQ'1$7KHXVHRI'1$LQ
YDFFLQHV LV EDVHG RQ WKH GLVFRYHU\ WKDW LQMHFWLQJ JHQHV LQ WKH IRUP RI SODVPLG '1$ FDQ
VWLPXODWH DQ LPPXQH UHVSRQVH WR WKH UHVSHFWLYH JHQH SURGXFWV 7KLV LPPXQH UHVSRQVH LV D
UHVXOWRIWKHJHQHV EHLQJ WDNHQ XS DQGH[SUHVVHG E\ FHOOVLQWKHDQLPDODIWHULQMHFWLRQ7KH
OLYHYHFWRU DQG '1$ YDFFLQDWLRQ V\VWHPV FRXOG EH PDQLSXODWHG IXUWKHU WR HQKDQFH WKH
LPPXQLW\FRQIHUUHGE\WKHJHQHSURGXFWV([SHULPHQWDOVWXGLHVKDYHGHPRQVWUDWHGWKDWWKHVH
YDFFLQHVFDQSRWHQWLDOO\LQGXFHDSSURSULDWHDQGHQGXULQJLPPXQHUHVSRQVHV7KLVWHFKQRORJ\
LVLQSULQFLSOHRQHRIWKHVLPSOHVWDQG\HWPRVWYHUVDWLOHPHWKRGVRILQGXFLQJERWKKXPHUDO
DQG FHOOXODU LPPXQH UHVSRQVHV DV ZHOO DV SURWHFWLQJ DJDLQVW D YDULHW\ RI LQIHFWLRXVDJHQWV
+RZHYHUDOWKRXJKLPPXQHUHVSRQVHVKDYHEHHQLQGXFHGLQDQXPEHURIODUJHUVSHFLHVPRVW
RIWKHLQIRUPDWLRQRQWKHHIILFDF\RI'1$LPPXQLVDWLRQFRPHVIURPVWXGLHVRIPLFH

$QH[KDXVWLYHUHYLHZRIWKHLQIRUPDWLRQDYDLODEOHRQWKHXVHRI'1$YDFFLQHVLQIDUP
DQLPDOVLQFOXGLQJFDWWOHSLJVDQGSRXOWU\KDVLGHQWLILHGWKHDUHDVWKDWQHHGVSHFLILFDWWHQWLRQ
EHIRUH WKLV WHFKQRORJ\ FDQ EH XVHG URXWLQHO\ 7KHVH DUHDV LQFOXGH WKH GHOLYHU\ VDIHW\ DQG
FRPSDWLELOLW\ RI SODVPLGV LQ PXOWLYDOHQW YDFFLQHV DQG WKH SRWHQWLDO IRU XVLQJ LPPXQH
VWLPXODQWVDVSDUWRID'1$YDFFLQH.RUHDQVFLHQWLVWVKDYHGHYHORSHGDFRPELQHGYDFFLQH
DJDLQVW SOHXURSQHXPRQLD SQHXPRQLF SDVWHXUHOORVLV DQG HQ]RRWLF SQHXPRQLD LQ VZLQH
0ROHFXODUELRORJ\KDVEHHQXVHGWRSURGXFHDQLPSURYHGYDFFLQHDJDLQVWVZLQHIHYHU,QWKH
3KLOLSSLQHV D YDFFLQH KDV EHHQ GHYHORSHG WKDW SURWHFWV FDWWOH DQG ZDWHU EXIIDOR DJDLQVW
KDHPRUUKDJLF VHSWLFDHPLD ZKLFK LV WKH OHDGLQJ FDXVH RI GHDWK LQ WKHVH DQLPDOV 7KH QHZ
YDFFLQHSURYLGHVLPSURYHGSURWHFWLRQDWDYHU\ORZFRVW

'LDJQRVWLFVDQGHSLGHPLRORJ\

$GYDQFHGGLDJQRVWLFWHVWVWKDWXVHELRWHFKQRORJ\HQDEOHWKHDJHQWVFDXVLQJGLVHDVHWR
EHLGHQWLILHGDQGWKHLPSDFWRIGLVHDVHFRQWUROSURJUDPPHVWREHPRQLWRUHGPRUHSUHFLVHO\
WKDQ ZDV SUHYLRXVO\ SRVVLEOH 0ROHFXODU HSLGHPLRORJ\ FKDUDFWHULVHV SDWKRJHQV YLUXVHV
EDFWHULD SDUDVLWHV DQG IXQJL  E\ QXFOHRWLGH VHTXHQFLQJ HQDEOLQJ WKHLU RULJLQV WR EH WUDFHG
7KLVLVSDUWLFXODUO\ LPSRUWDQW IRU HSLGHPLF GLVHDVHV LQZKLFKSLQSRLQWLQJWKHVRXUFHRIWKH
LQIHFWLRQ FDQ VLJQLILFDQWO\ LPSURYH GLVHDVH FRQWURO )RU H[DPSOH WKH PROHFXODU DQDO\VLV RI

Ϯϲϳ

ULQGHUSHVW YLUXVHV KDV EHHQ YLWDO LQ GHWHUPLQLQJ WKH OLQHDJHV FLUFXODWLQJ LQ WKH ZRUOG DQG
LQVWUXPHQWDO LQ DLGLQJ WKH *OREDO 5LQGHUSHVW (UDGLFDWLRQ 3URJUDPPH (Q]\PHOLQNHG
LPPXQRVRUEHQWDVVD\VKDYHEHFRPHWKHVWDQGDUGPHDQVRIGLDJQRVLQJDQGPRQLWRULQJPDQ\
DQLPDODQGILVKGLVHDVHVZRUOGZLGHDQGWKH3&5WHFKQLTXHLVHVSHFLDOO\XVHIXOLQGLDJQRVLQJ
OLYHVWRFN GLVHDVH 0DQ\ GLDJQRVWLF WHFKQLTXHV FXUUHQWO\ XVHG LQ GHYHORSLQJ FRXQWULHV DUH
FXPEHUVRPHDQGXQVXLWDEOHIRUORZUHVRXUFHVHWWLQJV0ROHFXODUGLDJQRVWLFWHFKQRORJLHVWKDW
DUH HLWKHU DOUHDG\ LQ XVH RU EHLQJ WHVWHG LQ ORZLQFRPH UHJLRQV LQFOXGH SRO\PHUDVH FKDLQ
UHDFWLRQ 3&5 PRQRFORQDODQWLERGLHVDQGUHFRPELQDQWDQWLJHQV7KHVHWHFKQRORJLHVFDQEH
PRGLILHGWRIDFLOLWDWHWKHLUDSSOLFDWLRQLQWKHGHYHORSLQJZRUOG6LPSOHKDQGKHOGGHYLFHVWKDW
UHO\RQWKHELQGLQJVSHFLILFLW\RIPRQRFORQDODQWLERGLHVRUUHFRPELQDQWDQWLJHQVWRGLDJQRVH
LQIHFWLRQ PD\ EH HDVLO\ DGDSWHG IRU XVH LQ VHWWLQJV ZLWKRXW UXQQLQJ ZDWHU UHIULJHUDWLRQ RU
HOHFWULFLW\

0ROHFXODU FKDUDFWHULVDWLRQ RI WKH YLUXV VHURW\SHV FDXVLQJ IRRW DQG PRXWK GLVHDVH KDV
KHOSHGLQWKHYDFFLQDWLRQDQGFRQWUROSURJUDPPHVLQ$VLD,Q-DSDQDQG7DLZDQ'1$WHVWLQJ
LVEHLQJXVHGWRGLDJQRVHKHUHGLWDU\ZHDNQHVVHVRIOLYHVWRFN2QHWHVWORRNVIRUWKHSUHVHQFH
RI WKH JHQH UHVSRQVLEOH IRU SRUFLQH VWUHVV V\QGURPH LQ SLJV 3LJV ZLWK WKLV JHQH WHQG WR
SURGXFH SDOH SRRUTXDOLW\ PHDW EHFDXVH RI WKHLU UHDFWLRQ WR WKH VWUHVV RI WUDQVSRUW DQG
VODXJKWHU3LJVZLWKWKLVJHQHFDQQRZEHH[FOXGHGIURPEUHHGLQJSURJUDPPHVVRWKHJHQH
ZLOOEHFRPHOHVVFRPPRQ,QDGGLWLRQ'1$WHVWLQJLVEHLQJXVHGLQ-DSDQWRFKHFNIRUWKH
JHQHWKDWFDXVHVOHXFRF\WHDGKHVLRQGHILFLHQF\LQ+ROVWHLQFDWWOH&DWWOHZLWKWKLVFRQGLWLRQ
VXIIHUIURPJXPGLVHDVHWRRWKORVVDQGVWXQWHGJURZWK7KH\XVXDOO\GLHEHIRUHWKH\DUHRQH
\HDU ROG %\ XVLQJ '1$ WHVWLQJ FDUULHUV FDQ EH LGHQWLILHG DQG HOLPLQDWHG IURP EUHHGLQJ
KHUGV %XOOV XVHG IRU EUHHGLQJ FDQ DOVR EH WHVWHG WR PDNH VXUH WKDW WKH\ DUH QRW FDUULHUV
$QRWKHU '1$ WHVW LGHQWLILHV D JHQHWKDW OHDGV WR DQDHPLD DQG UHWDUGHG JURZWK LQ -DSDQHVH
%ODFNFDWWOH

1XWULWLRQDQGIHHGXWLOLVDWLRQ

7KH VKRUWDJH RI IHHG LQ PRVW GHYHORSLQJ FRXQWULHV DQG WKH LQFUHDVLQJ FRVW RI IHHG
LQJUHGLHQWV PHDQ WKDW WKHUH LV D QHHG WR LPSURYH IHHG XWLOLVDWLRQ $LGV WR DQLPDO QXWULWLRQ
VXFK DVHQ]\PHV SURELRWLFVVLQJOHFHOO SURWHLQVDQG DQWLELRWLFV LQ IHHG DUH DOUHDG\ ZLGHO\
XVHGLQLQWHQVLYHSURGXFWLRQV\VWHPVZRUOGZLGHWRLPSURYHWKHQXWULHQWDYDLODELOLW\RIIHHGV
DQG WKH SURGXFWLYLW\ RI OLYHVWRFN *HQHEDVHG WHFKQRORJLHV DUH EHLQJ LQFUHDVLQJO\ XVHG WR
LPSURYHDQLPDOQXWULWLRQHLWKHUWKURXJKPRGLI\LQJWKHIHHGVWRPDNHWKHPPRUHGLJHVWLEOHRU
WKURXJK PRGLI\LQJ WKH GLJHVWLYH DQG PHWDEROLF V\VWHPV RI WKH DQLPDOV WR HQDEOH WKHP WR
PDNHEHWWHUXVHRIWKHDYDLODEOHIHHGV)HHGVGHULYHGIURP*0SODQWV DTXDUWHURIZKLFKDUH
QRZ JURZQ LQ GHYHORSLQJ FRXQWULHV  VXFK DV JUDLQ VLODJH DQG KD\ KDYH FRQWULEXWHG WR
LQFUHDVHV LQ JURZWK UDWHV DQG PLON \LHOG *HQHWLFDOO\ PRGLILHG FURSV ZLWK LPSURYHG DPLQR
DFLG SURILOHVFDQ EH XVHG WR GHFUHDVH QLWURJHQ H[FUHWLRQ LQ SLJV DQG SRXOWU\ ,QFUHDVLQJ WKH
OHYHOVRIDPLQRDFLGVLQJUDLQPHDQVWKDWWKHHVVHQWLDODPLQRDFLGUHTXLUHPHQWVRISLJVDQG
SRXOWU\FDQEHPHWE\GLHWVWKDWDUHORZHULQSURWHLQ0HWDEROLFPRGLILHUVKDYHDOVREHHQXVHG
WRLQFUHDVHSURGXFWLRQHIILFLHQF\ ZHLJKW JDLQRUPLON\LHOGSHUIHHGXQLW LPSURYHFDUFDVV
FRPSRVLWLRQ PHDWIDW UDWLR  LQFUHDVH PLON \LHOG DQG GHFUHDVH DQLPDO IDW 7KH XVH RI
UHFRPELQDQW ERYLQH VRPDWRWURSLQ U%67  LQ GDLU\ FRZV LQFUHDVHV ERWK PLON \LHOG DQG
SURGXFWLRQ HIILFLHQF\ DQG GHFUHDVHV DQLPDO IDW ,Q WKH 86$ WKH XVH RI U%67 W\SLFDOO\
LQFUHDVHVPLON\LHOGE\WR$OWKRXJKWULDOVFRQGXFWHGLQGHYHORSLQJFRXQWULHVKDYH
UHSRUWHGDVLPLODUSHUFHQWDJHLQFUHDVHWKLVLQFUHDVHLVQRWVLJQLILFDQWEHFDXVHRIWKHORZPLON
\LHOGV DQG WKH KLJK FRVWEHQHILW UDWLR +RZHYHU U%67 LV EHLQJ XVHG FRPPHUFLDOO\ LQ 
FRXQWULHVZKHUHWKHHFRQRPLFUHWXUQVPDNHLWVXVHZRUWKZKLOH$SRUFLQHVRPDWRWURSLQKDV

Ϯϲϴ

EHHQ GHYHORSHG WKDW LQFUHDVHV PXVFOH JURZWK DQG UHGXFHV ERG\IDW GHSRVLWLRQ UHVXOWLQJ LQ
SLJVWKDWDUHOHDQHUDQGRIJUHDWHUPDUNHWYDOXH&RQVWUDLQWVRQDSSO\LQJWKHWHFKQRORJ\7KH
DSSOLFDWLRQ RI QHZ PROHFXODU ELRWHFKQRORJLHV DQG QHZ EUHHGLQJ VWUDWHJLHV WR WKH OLYHVWRFN
EUHHGV XVHG LQ VPDOOKROGHU SURGXFWLRQ V\VWHPV LQ GHYHORSLQJ FRXQWULHV LV FRQVWUDLQHG E\ D
QXPEHURIIDFWRUV,QWKHGHYHORSLQJZRUOGSRYHUW\PDOQXWULWLRQGLVHDVHSRRUK\JLHQHDQG
XQHPSOR\PHQW DUH ZLGHVSUHDG DQG ELRWHFKQRORJLHV PXVW EH DEOH WR EH DSSOLHG LQ WKLV
FRQWH[W2YHUWKHODVWIHZGHFDGHVWKHJUHHQUHYROXWLRQKDVEURXJKWFRPSDUDWLYHSURVSHULW\
WRIDUPHUVZLWKODQGEXWWKHPDMRULW\RIIDUPHUVZKRDUHODQGOHVVRUPDUJLQDOIDUPHUVDQG
VXEVLVW RQO\ RQ OLYHVWRFN KDYH EHHQ QHJOHFWHG DQG UHPDLQ SRRU 7KH PDMRU FRQVWUDLQWV RQ
DSSO\LQJELRWHFKQRORJLHVKDYHEHHQHQXPHUDWHGDQGLQFOXGH

D WKHDEVHQFHRIDQDFFXUDWHDQGFRPSOHWHGDWDEDVHRQOLYHVWRFNDQGDQLPDORZQHUVVR
WKDWSURJUDPPHVFDQEHLPSOHPHQWHG
E WKHELRGLYHUVLW\SUHVHQWZLWKLQVSHFLHVDQGEUHHGVLQDJURHFRORJLFDOV\VWHPV
F WKH IDFW WKDW PRGHOV RI ELRWHFKQRORJLFDO LQWHUYHQWLRQ GLIIHU GLVWLQFWO\ EHWZHHQ
GHYHORSHGDQGGHYHORSLQJHFRQRPLHV
G WKHIDFWWKDWPDQ\DQLPDOVSHFLHVDQGEUHHGVDUHXQLTXHWRWKHGHYHORSLQJZRUOGHDFK
KDV LWV RZQ GLVWLQFW GHYHORSPHQWDO SURGXFWLRQ GLVHDVH UHVLVWDQFH DQG QXWULHQW
XWLOLVDWLRQFKDUDFWHULVWLFV
H WKHODFN RI WUDLQHG VFLHQWLVWV WHFKQLFLDQVDQG ILHOGZRUNHUV WR GHYHORS DQG DSSO\ WKH
WHFKQRORJLHVERWKLQWKHJRYHUQPHQWDQGLQWKHSULYDWHVHFWRUV
I WKH DEVHQFH RI DQ LQWHUIDFH EHWZHHQ LQGXVWU\ XQLYHUVLWLHV DQG LQVWLWXWLRQV ZKLFK LV
QHFHVVDU\WRWUDQVODWHWHFKQRORJLHVLQWRSURGXFWV
J WKHLQDELOLW\WRDFFHVVWHFKQRORJLHVIURPWKHGHYHORSHGZRUOGDWDQDIIRUGDEOHSULFHWR
PDNHDULJKWIXOSRVLWLYHDQGVXVWDLQDEOHFRQWULEXWLRQWROLYHVWRFNSURGXFWLRQDQGWKH
HFRQRPLFZHOIDUHRIIDUPHUV
K WKHKLJKFRVWRIWHFKQRORJLFDOLQSXWVVXFKDVPDWHULDOVELRORJLFDOVDQGHTXLSPHQW
L WKH IDLOXUH WR DGGUHVV LVVXHV RI ELRVDIHW\ DQG WR FRQGXFW ULVN DQDO\VHV RI QHZ
ELRORJLFDOVJHQHSURGXFWVWUDQVJHQLFVDQGPRGLILHGIRRGLWHPVDQGDERYHDOO
M WKHQHJOLJLEOHLQYHVWPHQWLQDQLPDOELRWHFKQRORJ\

7KH FULWLFDO LVVXHV DIIHFWLQJ OLYHVWRFN SURGXFWLYLW\ KDYH UHFHQWO\ EHHQ UHH[DPLQHG
5HVHDUFK WKDW DLPV WR HQKDQFH SURGXFWLYLW\ DQG VXVWDLQDELOLW\ VKRXOG IRFXV RQ LPSURYLQJ
OLYHVWRFNIHHGVDQGQXWULWLRQLPSURYLQJDQLPDOKHDOWKPDQDJLQJQDWXUDOUHVRXUFHVUHODWLQJWR
WKHOLYHVWRFNVHFWRUDVVHVLQJWKHLPSDFWRIWHFKQRORJLFDOLQWHUYHQWLRQVDQGVWUHQJWKHQLQJWKH
FDSDFLW\RIWKHQDWLRQDODJULFXOWXUDOUHVHDUFKV\VWHPVRIGHYHORSLQJFRXQWULHV

)XUWKHUPRUH WKH SRWHQWLDO SURGXFWLRQ FDSDFLW\ DQG FRQWULEXWLRQ RI OLYHVWRFN WR WKH
HFRQRP\DUHVWLOOQRWEHLQJDFKLHYHGLQGHYHORSLQJFRXQWULHVEHFDXVHWKHWUDQVIHUDGDSWDWLRQ
DQG DGRSWLRQ RI WHFKQRORJ\ LV KDPSHUHG E\ WKH ODFN RI D FOHDU SROLF\ IRU OLYHVWRFN
GHYHORSPHQWWKDWLVFRQGXFLYHWRWKHLQWURGXFWLRQRIQHZSURYHQWHFKQRORJ\DQGE\WKHODFN
RILQIRUPDWLRQIORZIURPDQGWRGHFLVLRQPDNHUV

,Q GHYHORSLQJ FRXQWULHV WKHUH LV D ZHDOWK JDS EHWZHHQ XUEDQ DQG UXUDO DUHDV ZKLFK
SHUVLVWV DQG PD\ HYHQ EH ZLGHQLQJ WKH UXUDOXUEDQ GLYLGH DOVR WHQGV WR EH UHIOHFWHG LQ
HGXFDWLRQ DQG KHDOWK LQGLFDWRUV ,Q DGGLWLRQ ZRPHQ LQ UXUDO DQG XUEDQ  DUHDV ZKR DUH
SUHGRPLQDQWO\LQYROYHGLQDQLPDOKXVEDQGU\KDYHKLJKHULOOLWHUDF\UDWHVWKDQPHQ$VXUYH\
RI$IULFDQFRXQWULHVUHFHQWO\ KLJKOLJKWHGWKHVXEVWDQWLDO GLVSDULWLHVLQSULPDU\ VFKRROLQJ
EHWZHHQXUEDQDQGUXUDODUHDVLQIDYRXURIXUEDQGZHOOHUV6SHFLDODWWHQWLRQPXVWEHJLYHQWR
WKHNQRZOHGJHDQGLQIRUPDWLRQQHHGHGWRHQDEOHUXUDOSHRSOHWRDSSO\ELRWHFKQRORJ\7KHUH

Ϯϲϵ

LVDQHHGWRLGHQWLI\DOWHUQDWLYHGHOLYHU\V\VWHPV EH\RQGWKH6WDWH IRUDQLPDOKHDOWKFDUHDQG
WRSURSRVHQHZUROHVIRUWKHVWDWHDQGWKHSULYDWHVHFWRULQVHUYLFHGHOLYHU\

%XLOGLQJFDSDFLW\

2ZLQJ WR WKH FRQVWUDLQWV RXWOLQHG DERYH WKH HFRQRPLF EHQHILWV RI DQLPDO
ELRWHFKQRORJ\FDQQRWEHUHDOLVHGZLWKRXWDFRQVFLRXVVXVWDLQHGKROLVWLFPXOWLVWDNHKROGHU
SDUWLFLSDWRU\ DSSURDFK 7KHUH LV D JUHDW QHHG WR HQVXUH WKDW FDSDFLW\ LV QRWMXVW FUHDWHG EXW
DOVRLVUHWDLQHGDQGHQKDQFHG&DSDFLW\EXLOGLQJ DFWLYLWLHVPXVW EHFDUULHGRXWDWDOOOHYHOV
WKH DZDUHQHVV RI SROLF\ DQG GHFLVLRQ PDNHUV PXVW EH UDLVHG WKH QHFHVVDU\ OHJDO DQG
UHJXODWRU\ IUDPHZRUNV PXVW EH LQLWLDWHG WKH WHFKQLFDO DQG UHJXODWRU\ FDSDFLWLHV PXVW EH
HQKDQFHG DQG LQVWLWXWLRQV PD\ QHHG WR EH RYHUKDXOHG 0RUH LPSRUWDQWO\ LW LV QHFHVVDU\ WR
DVVHVV DQG GHSOR\ FRPSHWHQW RSHUDWRUV DQG LQVWLWXWLRQDO FDSDFLW\ FRQWLQXRXVO\ VR WKDW DV
ELRWHFKQRORJ\DGYDQFHVWKHSURFHGXUHVUHTXLUHGIRULWVVDIHXVHFDQEHFRQVWDQWO\HYDOXDWHG
XSJUDGHG DQG DSSOLHG 7KLV LV D GDXQWLQJ WDVN EXW LW FDQ EH DFKLHYHG WKURXJK ILUP
FRPPLWPHQWDQGSDUWQHUVKLSV

)XQGLQJWRLPSOHPHQWWHFKQRORJ\

'HYHORSLQJDQGFRPPHUFLDOLVLQJLPSURYHGWHFKQRORJLHVLQPRVWGHYHORSLQJFRXQWULHV
KDVEHHQWKHUHVSRQVLELOLW\RIWKHSXEOLFVHFWRUDQGWHFKQRORJ\KDVEHHQGLVVHPLQDWHGIUHHO\
7KLV VLWXDWLRQZLOO KDYHWR FRQWLQXH LI VXSHULRU JHQHWLFV GLDJQRVWLFV DQG YDFFLQHV DUH WR EH
GHOLYHUHG +RZHYHU UHVHDUFK DQG PRVW FRPPHUFLDO GHYHORSPHQW RI ELRWHFKQRORJ\ LQ WKH
GHYHORSHGZRUOGDUHEHLQJGULYHQODUJHO\E\WKHSULYDWHVHFWRU7KHJOREDOWUHQGVLQIXQGLQJ
IRU UHVHDUFK DQG GHYHORSPHQW DQG SURGXFWLRQ GR QRW DGGUHVV WKH FRQFHUQV QHHGV DQG
RSSRUWXQLWLHV RI WKH GHYHORSLQJ ZRUOG 'HYHORSLQJ FRXQWULHV DUH ILQGLQJ LW LQFUHDVLQJO\
H[SHQVLYH WR DFFHVV DQG XVH QHZ WHFKQRORJLHV 7KHUH LV OLPLWHG SULYDWH DQG SXEOLFVHFWRU
LQYHVWPHQW LQ DQLPDO KHDOWK DQG SURGXFWLRQ SDUWLFXODUO\ LQ UHODWLRQ WR PRGHUQ
ELRWHFKQRORJLHVWKDWDUHµUHVRXUFHKXQJU\¶$OWKRXJKVHYHUDOGLVFRYHULHVKDYHEHHQPDGHLQ
ODERUDWRULHVLQWKHGHYHORSLQJZRUOGLQPRVWFDVHVWKHVHKDYHQRWEHHQFRQYHUWHGLQWRXVHIXO
WHFKQRORJLHVRUSURGXFWV7KHNH\SRWHQWLDOXVHUVUHVRXUFHSRRURIWHQLOOLWHUDWHIDUPHUVZLWKD
OLPLWHGNQRZOHGJHEDVH±GRQRWIHHOWKDWDSSO\LQJWKHVHWHFKQRORJLHVLVZRUWKWKHHIIRUWFRVW
DQGULVNLQYROYHG7KLVLVPDLQO\EHFDXVHWKHUHLVQRDJHQF\RULQGXVWU\WKDWFDQVFDOHXSDQG
SDFNDJH WKH WHFKQRORJ\ $OVR LQ WKH GHYHORSHG ZRUOG WKHUH LV DQ HFRQRPLF LQFHQWLYH WR
PDUNHW ELRWHFKQRORJLFDO VHUYLFHV DQG SURGXFWV WKLV LV ODFNLQJ LQ WKH GHYHORSLQJ ZRUOG
EHFDXVH RI WKH OLPLWHG SXUFKDVLQJ SRZHU RI UHVRXUFHSRRU VWDNHKROGHUV 5HVHDUFK LQ
ELRWHFKQRORJ\LQUHFHQW\HDUVKDVDOVREHHQPRWLYDWHGE\HFRQRPLFFRQVLGHUDWLRQVDQGOLWWOH
UHVHDUFKLVFRQGXFWHGLQWKHGHYHORSLQJZRUOGEHFDXVHRIWKHSUREDEOHODFNRIUHWXUQVRQWKH
LQYHVWPHQW )RU XQGHUVWDQGDEOH UHDVRQV FXUUHQW IXQGLQJ SROLFLHV LQ GHYHORSLQJ FRXQWULHV
IRFXVRQDUHDVWKDWZLOO\LHOGSUDFWLFDOEHQHILWLQWKHVKRUWWHUP,QGHWHUPLQLQJIXWXUHSROLF\
SROLF\PDNHUVDQGIXQGLQJERGLHVPXVWQRWORVHVLJKWRIWKHVXEVWDQWLDOEHQHILWVWKDWFDQEH
JDLQHG LQ WKH ORQJHU WHUP E\ LQYHVWLQJ LQ VWUDWHJLF UHVHDUFK LQWR YDFFLQH GHYHORSPHQW
$GHTXDWH PXOWLLQVWLWXWLRQDO QDWLRQDO DQG LQWHUQDWLRQDO  VXSSRUW WKURXJK DQ LQWHUQDWLRQDO
GRQRU FRQVRUWLXP LV QHHGHG WR GHYHORS FRVWHIIHFWLYH FKHDS DQG HDVLO\ DGDSWDEOH
ELRWHFKQRORJLFDO SURGXFWV 7KH DPRXQW VSHQW E\ LQWHUQDWLRQDO DJHQFLHV RQ DQLPDO
ELRWHFKQRORJ\ LQ GHYHORSLQJ FRXQWULHV LV FXUUHQWO\ YHU\ ORZ DQG FRQVWLWXWHV RQO\ D VPDOO
SHUFHQWDJHRIWKHWRWDOVSHQGLQJRQDJULFXOWXUH7KH:RUOG%DQNWKH)RRGDQG$JULFXOWXUH
2UJDQL]DWLRQ WKH &RQVXOWDWLYH *URXS RQ ,QWHUQDWLRQDO $JULFXOWXUDO 5HVHDUFK WKH 8QLWHG
1DWLRQV'HYHORSPHQW3URJUDPPHWKH8QLWHG6WDWHV$JHQF\IRU,QWHUQDWLRQDO'HYHORSPHQW
WKH6ZHGLVK,QWHUQDWLRQDO'HYHORSPHQW&RRSHUDWLRQ$JHQF\WKH,QWHUQDWLRQDO'HYHORSPHQW

ϮϳϬ

5HVHDUFK&HQWUHWKH$VLDQ'HYHORSPHQW%DQNDQGRWKHUGRQRUDQGIXQGLQJDJHQFLHVKDYHWR
GHVLJQDWHDKLJKHUSHUFHQWDJHRIIXQGVWRWKHOLYHVWRFNVHFWRU,WKDVEHHQFRQYLQFLQJO\VKRZQ
WKDWLQYHVWLQJLQOLYHVWRFNKDVDGUDPDWLFDQGIDUUHDFKLQJLPSDFWRQWKHKXPDQGHYHORSPHQW
LQGH[ 7KLV LV D VWURQJ DUJXPHQW LQ IDYRXU RI LQYHVWLQJ KHDYLO\ LQ DQLPDO SURGXFWLRQ DQG
KHDOWK ELRWHFKQRORJLHV WR EULQJ HFRQRPLF SURVSHULW\ QXWULWLRQDO VHFXULW\ DQG UXUDO
GHYHORSPHQWDQGKHDOWKLPSURYHPHQWVWRSRRUSRSXODWLRQVLQWKHGHYHORSLQJZRUOG

&RQFOXVLRQV

$OWKRXJK DQLPDO SURGXFWLRQ LV EHLQJ FKDQJHG VLJQLILFDQWO\ E\ DGYDQFHV PDGH LQ
WKRXVDQGV RI ELRWHFKQRORJ\ ODERUDWRULHV DURXQG WKH ZRUOG EHQHILWV DUH UHDFKLQJ WKH
GHYHORSLQJ ZRUOG LQ RQO\ D IHZ DUHDV RI FRQVHUYDWLRQ DQLPDO LPSURYHPHQW KHDOWKFDUH
LQFOXGLQJ GLDJQRVLV DQG FRQWURO RI GLVHDVH  DQG WKH DXJPHQWDWLRQ RI IHHG UHVRXUFHV
$GRSWLQJELRWHFKQRORJ\KDVUHVXOWHGLQGLVWLQFWEHQHILWVLQWHUPVRIDQLPDOLPSURYHPHQWDQG
HFRQRPLF UHWXUQV WR WKH IDUPHUV 2YHU WKH SDVW GHFDGH WKH ,/5, KDV IRFXVHG RQ
ELRWHFKQRORJLFDO DSSOLFDWLRQV HVSHFLDOO\ LQ $IULFD DQG VHYHUDO GHYHORSLQJ FRXQWULHV QRZ
KDYH PXOWLLQVWLWXWLRQDO SURJUDPPHV WR GHYHORS DQG DSSO\ ELRWHFKQRORJ\ 7KH GHYHORSLQJ
ZRUOGZLOOKDYHWRUHVSRQGWRWKHPDQ\JHQHEDVHGWHFKQRORJLHVQRZEHLQJGHYHORSHGZLWKD
VHQVHRIFRPPLWPHQWWUDLQHGPDQSRZHULQIUDVWUXFWXUHDQGIXQGLQJ

5HIHUHQFHV

$OVWRQ -0 1RUWRQ *:  3DUGH\ 3*   ± 6FLHQFH XQGHU VFDUFLW\ SULQFLSOHV DQG
SUDFWLFH IRU DJULFXOWXUDO UHVHDUFK HYDOXDWLRQ DQG SULRULW\ VHWWLQJ &RUQHOO 8QLYHUVLW\
3UHVV,WKDFDSS
$XVWULD  2FWREHU  2SHQLQJ DGGUHVV )RRG DQG $JULFXOWXUH
2UJDQL]DWLRQ,QWHUQDWLRQDO $WRPLF (QHUJ\ $JHQF\ 9LHQQD :HEVLWH
ZZZLDHDRUJSURJUDPPHVQDIDGSXEOLFRSHQLQJDGGUHVVGLUHFWRUIDRSGI
%DUURV &0  1RJXHLUD 0)*   ± (PEU\R WUDQVIHU LQ %RV LQGLFXV FDWWOH
7KHULRJHQRORJ\
%HGIRUG05  ±([RJHQRXVHQ]\PHVLQPRQRJDVWULFQXWULWLRQWKHLUFXUUHQWYDOXHDQG
IXWXUHEHQHILWV$QLP)HHG6FL7HFKQRO
%HQQHWW 5 0RUVH 6  ,VPDHO <   ± 7KH EHQHILWV RI %W FRWWRQ WR VPDOOVFDOH
SURGXFHUV LQ GHYHORSLQJ FRXQWULHV WKH FDVH RI 6RXWK $IULFD ,Q WK ,&$%5
,QWHUQDWLRQDO &RQIHUHQFH RQ 3XEOLF *RRGV DQG 3XEOLF 3ROLF\ IRU $JULFXOWXUDO
%LRWHFKQRORJ\  -XQH -XO\ 5DYHOOR ,QWHUQDWLRQDO &RQVRUWLXP RQ $JULFXOWXUDO
%LRWHFKQRORJ\ 5HVHDUFK 5DYHOOR :HEVLWH
ZZZHFRQRPLDXQLURPDLWFRQIHUHQ]HLFDEUSDSHUVLQGH[KWP DFFHVVHG RQ 
-XQH 
%LUWKDO36-RVKL3. .XPDU$  ±$VVHVVPHQWRIUHVHDUFKSULRULWLHVIRUOLYHVWRFN
VHFWRULQ,QGLD3ROLF\SDSHU1R1DWLRQDO&HQWUHIRU $JULFXOWXUDO (FRQRPLFV DQG
3ROLF\5HVHDUFK1HZ'HOKLSS
%LUWKDO36.XPDU$5DYL6KDQNDU$ 3DQGH\8.  ±6RXUFHVRIJURZWKLQWKH
OLYHVWRFN VHFWRU 3ROLF\ SDSHU 1R  1DWLRQDO &HQWUHIRU $JULFXOWXUDO (FRQRPLFVDQG
3ROLF\5HVHDUFK1HZ'HOKLSS
%\HUOHH' )LVFKHU.  ±$FFHVVLQJPRGHUQVFLHQFHSROLF\DQGLQVWLWXWLRQDORSWLRQV
IRUDJULFXOWXUDOELRWHFKQRORJ\LQGHYHORSLQJFRXQWULHV:RUOG'HY
%\HUOHH '  +HVVH GH 3RODQFR (   ± )DUPHUV¶ VWHSZLVH DGRSWLRQ RI WHFKQRORJLFDO
SDFNDJHVHYLGHQFHIURPWKH0H[LFDQ$OWLSODQR$P-DJULF(FRQ

Ϯϳϭ

&KDXKDQ066LQJOD6.0DQLN56 0DGDQ0/  ±,QFUHDVHGFDSDFLWDWLRQRI
EXIIDORVSHUPE\KHSDULQDVFRQILUPHGE\HOHFWURQPLFURVFRS\DQGLQYLWURIHUWLOL]DWLRQ
,QGLDQ-H[SHULP%LRO
&KDXKDQ066LQJOD6.3DOWD30DQLN56 0DGDQ0/  ±,QYLWURPDWXUDWLRQ
DQG IHUWLOL]DWLRQ DQG VXEVHTXHQW GHYHORSPHQW RI EXIIDOR %XEDOXV EXEDOLV  HPEU\RV
HIIHFWVRIRRF\WHTXDOLW\DQGW\SHRIVHUXP5HSURG)HUWLO'HY
&KDXKDQ 06 6LQJOD 6. 3DOWD 3 0DQLN 56  0DGDQ 0/   ± (IIHFW RI
HSLGHUPDO JURZWK IDFWRU RQ WKH FXPXOXV H[SDQVLRQ PHLRWLF PDWXUDWLRQ DQG
GHYHORSPHQWRIEXIIDORRRF\WHVLQYLWUR9HW5HF
'1/5DR $6XEED5DRHGV ,Q3URFWK$JULFXOWXUDO6FLHQFH&RQJUHVV%KRSDO
)HEUXDU\1DWLRQDO$FDGHP\RI$JULFXOWXUDO6FLHQFHV1HZ'HOKL
'DDU $6 7KRUVWHLQVGRWWLU + 0DUWLQ '. 6PLWK $& 1DVW 6  6LQJHU 3$   ±
7RSWHQELRWHFKQRORJLHVIRULPSURYLQJKHDOWKLQGHYHORSLQJ FRXQWULHV 1DWXUH *HQHW

'DVWDJLUL 0%   ± 'HPDQG DQG SROLF\ SURMHFWLRQV IRU OLYHVWRFN SURGXFWLRQ LQ ,QGLD
3ROLF\SDSHU1R1DWLRQDO&HQWUHIRU$JULFXOWXUDO(FRQRPLFVDQG3ROLF\5HVHDUFK
1HZ'HOKL
'HOJDGR &/ +RSNLQV -  .HOO\ 9$   ± $JULFXOWXUDO JURZWK OLQNDJHV LQ VXE
6DKDUDQ$IULFD5HVHDUFK5HSRUW1R,QWHUQDWLRQDO)RRG3ROLF\5HVHDUFK,QVWLWXWH
:DVKLQJWRQ'&SS
'HQQLQJ &  3ULGGOH +   ± 1HZ IURQWLHUV LQ JHQH WDUJHWLQJ DQG FORQLQJ VXFFHVV
DSSOLFDWLRQ DQG FKDOOHQJHV LQ GRPHVWLF DQLPDOV DQG KXPDQ HPEU\RQLF VWHP FHOOV
5HSURGXFWLRQ
'KDOPLQL=6SLOODQH&0RVV-35XDQH-8UTXLD1 6RQQLQR$  ±6WDWXVRI
UHVHDUFK DQG DSSOLFDWLRQ RI FURS ELRWHFKQRORJLHV LQ GHYHORSLQJ FRXQWULHV ± D
SUHOLPLQDU\DVVHVVPHQW5HQRXI%RRNV2JGHQVEXUJ1HZ<RUNSS
'RUMHH.%URFD6 3LQJDOL3  ±'LYHUVLILFDWLRQLQ6RXWK$VLDQDJULFXOWXUHWUHQGV
DQGFRQVWUDLQWV(6$:RUNLQJSDSHU)RRGDQG$JULFXOWXUH2UJDQL]DWLRQ5RPH
SS
'UXFNHU $*   ± 7KH HFRQRPLFV RI IDUP DQLPDO JHQHWLF UHVRXUFH FRQVHUYDWLRQ DQG
VXVWDLQDEOHXVHZK\LVLWLPSRUWDQWDQGZKDWKDYHZHOHDUQHG"%DFNJURXQGVWXG\SDSHU
1R)RRGDQG$JULFXOWXUH2UJDQL]DWLRQ5RPHSS
)DQ 6 +D]HOO 3  7KRUDW 6   ± *RYHUQPHQW VSHQGLQJ JURZWK DQG SRYHUW\ DQ
DQDO\VLV RI LQWHUOLQNDJHV LQ UXUDO ,QGLD (QYLURQPHQW DQG 3URGXFWLRQ 7HFKQRORJ\
'LYLVLRQ GLVFXVVLRQ SDSHU 1R  ,QWHUQDWLRQDO )RRG 3ROLF\ 5HVHDUFK ,QVWLWXWH
:DVKLQJWRQ'&SS
)DULQ 3: &URVLHU $(  )DULQ &(   ± ,QIOXHQFH RI LQ YLWUR V\VWHPV RQ HPEU\R
VXUYLYDODQGIHWDOGHYHORSPHQWLQFDWWOH7KHULRJHQRORJ\
)ODYHOO 5   ± %LRWHFKQRORJ\ DQG IRRG DQG QXWULWLRQ QHHGV ELRWHFKQRORJ\ IRU
GHYHORSLQJFRXQWU\DJULFXOWXUHSUREOHPVDQGRSSRUWXQLWLHV%ULHIRI,QWHUQDWLRQDO
)RRG3ROLF\5HVHDUFK,QVWLWXWH:DVKLQJWRQ'&SS
)RRG DQG $JULFXOWXUH 2UJDQL]DWLRQ )$2    ± 7KH DSSURSULDWHQHVV VLJQLILFDQFH DQG
DSSOLFDWLRQRIELRWHFKQRORJ\RSWLRQVLQWKHDQLPDODJULFXOWXUHRIGHYHORSLQJFRXQWULHV
(OHFWURQLFIRUXPRQELRWHFKQRORJ\LQIRRGDQGDJULFXOWXUH&RQIHUHQFH)$25RPH
)RRGDQG$JULFXOWXUH2UJDQL]DWLRQ )$2   ±7KH6WDWHRI)RRGDQG$JULFXOWXUH
$JULFXOWXUDOELRWHFKQRORJ\PHHWLQJWKHQHHGVRIWKHSRRU)$25RPHSS
)RRG DQG $JULFXOWXUH 2UJDQL]DWLRQ )$2 ,QWHUQDWLRQDO $WRPLF (QHUJ\ $JHQF\ ,$($ 
  ± )LQDO UHSRUW ±LQWHUQDWLRQDO V\PSRVLXP RQ DSSOLFDWLRQV RI JHQHEDVHG
WHFKQRORJLHV IRU LPSURYLQJ DQLPDO SURGXFWLRQ DQG KHDOWK LQ GHYHORSLQJ FRXQWULHV
)$2,$($9LHQQDSS

ϮϳϮ

*DOOL&&URWWL*1RWDUL&7XULQL3'XFKL5 /D]]DUL*  ±(PEU\RSURGXFWLRQ
E\RYXPSLFNXSIURPOLYHGRQRUV7KHULRJHQRORJ\
*DVSDUULQL %   ± ,Q YLWUR HPEU\R SURGXFWLRQ LQ EXIIDOR VSHFLHV VWDWH RI WKH DUW
7KHULRJHQRORJ\
*RUGRQ*/5 3KLOOLSV0:  ±7KHUROHRIDQDHURELFJXWIXQJLLQUXPLQDQWV1XWU
5HV5HY
+D]HOO 3  +DJJEODGH 6   ± )DUPQRQIDUP JURZWK OLQNDJHV DQG WKH ZHOIDUH RI WKH
SRRU ,Q ,QFOXGLQJ WKH SRRU 0 /LSWRQ  - YDQ GHU *DDJ HGV  :RUOG %DQN
:DVKLQJWRQ'&
+HUGW5:  ±$UHWURVSHFWLYHYLHZRIWHFKQRORJLFDODQGRWKHUFKDQJHVLQ3KLOLSSLQH
ULFHIDUPLQJ(FRQ'HYFXOW&KDQJH
+REEHOLQN +   ± 1HZ KRSH RU IDOVH SURPLVH" %LRWHFKQRORJ\ DQG 7KLUG :RUOG
DJULFXOWXUH,QWHUQDWLRQDO&RDOLWLRQIRU'HYHORSPHQW$FWLRQ%UXVVHOVSS
-DEEDU 0$  'LHGKLRX 0/   ± 'RHV EUHHG PDWWHU WR FDWWOH IDUPHUV DQG EX\HUV"
(YLGHQFHIURP:HVW$IULFD(FRO(FRQ
-DPHV &   ± 3UHYLHZ JOREDO VWDWXV RI FRPPHUFLDOL]HG WUDQVJHQLF FURSV 
,QWHUQDWLRQDO6HUYLFHIRUWKH$FTXLVLWLRQRI$JULELRWHFK$SSOLFDWLRQV ,6$$$ %ULHIV
1R,6$$$,WKDFD1HZ<RUNSS
-XW]L6  ±$SSOLFDWLRQVRIJHQHEDVHGWHFKQRORJLHVIRULPSURYLQJDQLPDOSURGXFWLRQ
DQGKHDOWKLQGHYHORSLQJFRXQWULHV)$2,$($,QWHUQDWLRQDO6\PSRVLXP9LHQQD
.XUVWDN(  ±7RZDUGVQHZYDFFLQHVDQGPRGHUQYDFFLQRORJ\LQWURGXFWRU\UHPDUNV
9DFFLQH
0D + 5DH $1  +XDQJ -   ± /LYHVWRFN SURGXFWLYLW\ LQ &KLQD GDWDUHYLVLRQ DQG
WRWDOIDFWRU SURGXFWLYLW\ GHFRPSRVLWLRQ &KLQDDJULFXOWXUHZRUNLQJSDSHU&HQWUH
IRU $SSOLHG (FRQRPLFV DQG3ROLF\ 6WXGLHV 0DVVH\ 8QLYHUVLW\ 3DOPHUVWRQ 1RUWK 
SS
0DFHU '5-   ± %LRWHFKQRORJ\ LQWHUQDWLRQDO FRPSHWLWLRQ DQG LWV HFRQRPLF HWKLFDO
DQG VRFLDO LPSOLFDWLRQV LQ GHYHORSLQJ FRXQWULHV ,Q &RQFHSWV LQ ELRWHFKQRORJ\ '
%DODVXEUDPDQLDQ &)$ %U\FH . 'KDUPDOLQJDP - *UHHQ . -D\DUDPDQ HG 
8QLYHUVLWLHV3UHVV3YW/WG2ULHQW/RQJPDQ,QF+\GHUDEDG
0DGDQ 0/   ± %LRWHFKQRORJLHV LQ DQLPDO UHSURGXFWLRQ .H\ QRWH DGGUHVV DW
LQWHUQDWLRQDO FRQIHUHQFH RQ DQLPDO ELRWHFKQRORJ\ 7DPLOQDGX 9DWHULQDU\ DQG $QLPDO
6FLHQFH8QLYHUVLW\&KHQQDL
0DGDQ 0/   ± 2SSRUWXQLWLHV DQG FRQVWUDLQWV IRU XVLQJ JHQHEDVHG WHFKQRORJLHV LQ
DQLPDO DJULFXOWXUH LQ GHYHORSLQJ FRXQWULHV DQG SRVVLEOH UROH RI LQWHUQDWLRQDO GRQRU
DJHQFLHV LQ SURPRWLQJ 5 ' LQ WKLV ILHOG ,Q )$2,$($ LQWHUQDWLRQDO V\PSRVLXP RQ
DSSOLFDWLRQVRIJHQHEDVHGWHFKQRORJLHVIRULPSURYLQJDQLPDOSURGXFWLRQDQGKHDOWKLQ
GHYHORSLQJ FRXQWULHV 9LHQQD $XVWULD  2FWREHU  )RRG DQG $JULFXOWXUH
2UJDQL]DWLRQ,QWHUQDWLRQDO$WRPLF(QHUJ\$JHQF\9LHQQD
0DGDQ 0/ &KDXKDQ 06 6LQJOD 6.  0DQLN 56   ± 3UHJQDQFLHV HVWDEOLVKHG
IURPZDWHUEXIIDOR %XEDOXVEXEDOLV EODVWRF\VWVGHULYHGIURPLQYLWURPDWXUHGLQYLWUR
IHUWLOL]HG RRF\WHV DQG FRFXOWXUHG ZLWK FXPXOXV DQG RYLGXFWDO FHOOV 7KHULRJHQRORJ\

0DGDQ 0/ 'DV 6.  3DOWD 3   ± $SSOLFDWLRQ RI UHSURGXFWLYH WHFKQRORJ\ WR
EXIIDORHV$QLP5HSURG6FL
0DGDQ 0/ 6LQJOD 6. &KDXKDQ 06  0DQLN 56   ± ,Q YLWUR SURGXFWLRQ DQG
WUDQVIHURIHPEU\RVLQEXIIDORHV7KHULRJHQRORJ\
0DGDQ 0/ 6LQJOD 6. -DLONKDQL 6  $PEURVH -'   ± ,Q YLWUR IHUWLOL]DWLRQ DQG
ELUWKRIILUVWHYHU,9)EXIIDORFDOI,Q3URFUG:RUOG%XIIDOR&RQJUHVV9DUQD

Ϯϳϯ

0F'HUPRWW--5DQGROSK7) 6WDDO6-  ±7KHHFRQRPLFVRIRSWLPDOKHDOWKDQG
SURGXFWLYLW\ LQ VPDOOKROGHU OLYHVWRFN V\VWHPV LQ GHYHORSLQJ FRXQWULHV ,Q 7KH
HFRQRPLFVRIDQLPDOGLVHDVHFRQWURO5HYVFLWHFK2IILQW(SL]  
0HOORU-:  ±7KHQHZHFRQRPLFVRIJURZWK\HDUVRIDJULFXOWXUDOGHYHORSPHQW
ZKDWLVROGZKDWLVQHZ$VLDQ-$JULF(FRQ
0HQGHOVRKQ 5   ± 7KH FKDOOHQJH RI FRQVHUYLQJ LQGLJHQRXV GRPHVWLFDWHG DQLPDOV
(FRO(FRQ
0LVUD $.   ± $SSOLFDWLRQ RI ELRWHFKQRORJLHV WR EXIIDOR EUHHGLQJ LQ ,QGLD ,Q UG
&RXUVHRQELRWHFKQRORJ\RIUHSURGXFWLRQLQEXIIDORHV&DVHUWD
1DQGL 6 &KDXKDQ 06  3DOWD 3   ± ,QIOXHQFH RI FXPXOXV FHOOV DQG VSHUP
FRQFHQWUDWLRQ RQ FOHDYDJH UDWH DQG VXEVHTXHQW HPEU\RQLF GHYHORSPHQW RI EXIIDOR
%XEDOXV EXEDOLV  RRF\WHV PDWXUHG DQG IHUWLOL]HG LQ YLWUR 7KHULRJHQRORJ\  

1DQGL65DJKX+05DYLQGUDQDWKD%0 &KDXKDQ06  ±3URGXFWLRQRIEXIIDOR
%XEDOXV EXEDOLV  HPEU\RV LQ YLWUR SUHPLVHV DQG SURPLVHV 5HSURG GRP $QLP 

1LQ $ +HUWHO 7: 5DH $1  (KXL 6   ±3URGXFWLYLW\ JURZWK µFDWFKLQJ XS¶ DQG
WUDGHLQOLYHVWRFNSURGXFWV ,/5,6RFLRHFRQRPLFV DQG SROLF\UHVHDUFKZRUNLQJSDSHU
1R,QWHUQDWLRQDO/LYHVWRFN5HVHDUFK,QVWLWXWH1DLURELSS
2LVKL 7 &KHRQJ ,& 9LOODU (& /HH 61  9DMUDEXNND &   ± $SSOLHG
ELRWHFKQRORJ\LQDQLPDOSURGXFWLRQ,VVXHVLQ$VLDQ$JULFXOWXUH)RRGDQG
)HUWLOL]HU 7HFKQRORJ\ &HQWHU 7DLZDQ :HEVLWH ZZZIIWFDJQHWRUJ DFFHVVHG RQ 
-XQH 
3DO6 %\HUOHH'  ±7KHIXQGLQJDQGRUJDQL]DWLRQRIDJULFXOWXUDOUHVHDUFKLQ,QGLD
HYROXWLRQ DQG HPHUJLQJ SROLF\ LVVXHV 3ROLF\ SDSHU 1R  1DWLRQDO &HQWUH IRU
$JULFXOWXUDO(FRQRPLFVDQG3ROLF\5HVHDUFK1HZ'HOKLSS
3LQJDOL 3/  7UD[OHU *   ± &KDQJLQJ ORFXV RI DJULFXOWXUDO UHVHDUFK ZLOO WKH SRRU
EHQHILWIURPELRWHFKQRORJ\DQGSULYDWL]DWLRQWUHQGV")RRG3ROLF\
3UD\ &(  +XDQJ -   ± 7KH LPSDFW RI %7 FRWWRQ LQ &KLQD ,Q 7KH HFRQRPLF DQG
HQYLURQPHQWDO LPSDFWV RI DJELRWHFK D JOREDO SHUVSHFWLYH 1 .DODLW]DQGRQDNHV HG 
.OXZHU3OHQXP$FDGHPLF3XEOLVKHUV1HZ<RUN
3UD\&( 1DVHHP$  ±%LRWHFKQRORJ\5 'SROLF\RSWLRQVWRHQVXUHDFFHVVDQG
EHQHILWV IRU WKH SRRU (6$ ZRUNLQJ SDSHU 1R  )RRG DQG $JULFXOWXUH
2UJDQL]DWLRQ5RPHSS
3UD\ &(  1DVHHP $   ± 7KH HFRQRPLFV RI DJULFXOWXUDO ELRWHFKQRORJ\ UHVHDUFK
(6$ZRUNLQJSDSHU1R)RRGDQG$JULFXOWXUH2UJDQL]DWLRQ5RPHSS
5DQJL36  ±7UDGHDQGSROLF\LVVXHVDQGGHYHORSPHQWRIPXOWLHQWHUSULVHDJULFXOWXUH
V\VWHP0XOWLHQWHUSULVHV\VWHPIRUYLDEOHDJULFXOWXUH &/$FKDU\D5.*XSWD
5HJH-(2 *LEVRQ-3  ±$QLPDOJHQHWLFUHVRXUFHVDQGHFRQRPLFGHYHORSPHQW
LVVXHVLQUHODWLRQWRHFRQRPLFYDOXDWLRQ(FRO(FRQ
6DQVRQH * 1DVWUL 0-)  )DEEURFLQL $   ± 6WRUDJH RI EXIIDOR %XEDOXV EXEDOLV 
VHPHQ$QLP5HSURG6FL
6FKPLWW(-'LD]7'URVW0 7KDWFKHU::  ±8VHRIDJRQDGRWURSLQUHOHDVLQJ
KRUPRQHDJRQLVWRUKXPDQFKRULRQLFJRQDGRWURSLQIRUWLPHGLQVHPLQDWLRQLQFDWWOH -
$QLP6FL
6LQJK - 1DQGD $6  $GDPV *3   ± 7KH UHSURGXFWLYH SDWWHUQ DQG HIILFLHQF\ RI
IHPDOHEXIIDORHV$QLP5HSURG6FL
6LQJOD 6. 0DQLN 56  0DGDQ 0/   ± (PEU\R ELRWHFKQRORJ\ LQ EXIIDORHV D
UHYLHZ%XEDOXVEXEDOLV

Ϯϳϰ

7DQHMD9. %LUWKDO36  ±$QLPDOKXVEDQGU\HQWUHSUHQHXUVKLSDQGSROLF\VXSSRUW
0XOWLHQWHUSULVHV\VWHPIRUYLDEOHDJULFXOWXUH &/$FKDU\D5.*XSWD'1/5DR
 $ 6XEED 5DR HGV  ,Q 3URF WK $JULFXOWXUDO 6FLHQFH &RQJUHVV %KRSDO 
)HEUXDU\1DWLRQDO$FDGHP\RI$JULFXOWXUDO6FLHQFHV1HZ'HOKL
7UD[OHU* %\HUOHH'  ±(FRQRPLFUHWXUQVWRFURSPDQDJHPHQWUHVHDUFKLQSRVW
JUHHQUHYROXWLRQVHWWLQJ$P-DJULF(FRQ
7UD[OHU*  ±7KHHFRQRPLFLPSDFWVRIELRWHFKQRORJ\EDVHGWHFKQRORJLFDOLQQRYDWLRQV
(6$ZRUNLQJSDSHU1R)RRGDQG$JULFXOWXUH2UJDQL]DWLRQ5RPHSS
7UD[OHU**RGR\$YLOD6)DOFN=HSHGD- (VSLQR]D$UHOODQR--  ±7UDQVJHQLF
FRWWRQ LQ 0H[LFR D FDVH VWXG\ RI WKH &RPDUFD /DJXQHUD ,Q 7KH HFRQRPLF DQG
HQYLURQPHQWDO LPSDFWV RI DJELRWHFK D JOREDO SHUVSHFWLYH 1 .DODLW]DQGRQDNHV HG 
.OXZHU3OHQXP$FDGHPLF3XEOLVKHUV1HZ<RUN
9DQ'UXQHQ/LWWHOYDQGHQ+XUN6*HUGWV9/RHKU%,3RQWDUROOR55DQNLQ58ZLHUD
5  %DELXN /$   ±5HFHQW DGYDQFHV LQ WKH XVH RI '1$ YDFFLQHV IRU WKH
WUHDWPHQWRIGLVHDVHVRIIDUPHGDQLPDOV$GY'UXJ'HOLY5HY
9LVKZDQDWK5 6KDQQRQ3  ±6WRUDJHRIERYLQHVHPHQLQOLTXLGDQGIUR]HQVWDWH
$QLP5HSURG6FL


















Ϯϳϱ


&KDSWHU
&ORQLQJ

1XFOHDUWUDQVIHU

'ROO\ZDVQRWFUHDWHGLQWKHRUGLQDU\ZD\7\SLFDOO\DODPELVWKHSURGXFWRIQDWXUDO
UHSURGXFWLRQ²WZRJHUPFHOOVDVSHUPIURPDQDGXOWPDOHDQGDQHJJ RRF\WH IURPDQDGXOW
IHPDOHIXVHDWIHUWLOL]DWLRQ(DFKRIWKHVHJHUPFHOOV WKHVSHUPDQGWKHRRF\WH FRQWULEXWHV
KDOI WKH FKURPRVRPHV QHHGHG WR FUHDWH D QHZ LQGLYLGXDO &KURPRVRPHV DUH IRXQG LQ WKH
FHOO¶V QXFOHXV DQG WKH\ FDUU\ WKH '1$ ZKLFK LV WKH JHQHWLF EOXHSULQW IRU DQ LQGLYLGXDO
)LJ 



)LJ$6H[XDO5HSURGXFWLRQDQG%6RPDWLFFHOOQXFOHDUWUDQVIHULQ6KHHS


1XFOHDUUHSODFHPHQW

*HQHWLFPDWHULDO QXFOHXVIURPHPEU\RQLFIHWDORUDGXOWFHOO LVUHPRYHGDQGSODFHG
LQWRDQXQIHUWLOL]HGHJJRUHPEU\RZKRVHQXFOHXVKDVEHHQUHPRYHG,QWKLVFDVHWKHQXFOHDU
JHQHVUHPDLQWKHVDPHEXWWKHPLWRFKRQGULD'1$ZRXOGEHGLIIHUHQW7KLVKDVWKHSRWHQWLDO
WRFUHDWHWKHFORQHRIDQDGXOWRUJDQLVPDVZHOODVPDQ\FORQHVDWRQFH


Ϯϳϲ

 'ROO\ ZDV FORQHG XVLQJ WKH QXFOHDU UHSODFHPHQW PHWKRG $JDLQ WKH QXFOHXV ZLWK
FKURPRVRPH VHWV LV IXVHG ZLWK DQ XQIHUWLOL]HG HJJ ZKRVH QXFOHXV KDV EHHQ UHPRYHG
0RWLYDWLQJIDFWRUZDVWKDWLWFRXOGKHOSWRLPSURYHFHUWDLQTXDOLWLHVLQOLYHVWRFN
'ROO\ZDVQRWWKHILUVWVKHHSWREHFUHDWHGIURPQXFOHDUUHSODFHPHQW7ZRJHQHWLFDOO\
LGHQWLFDOVKHHS0HJDQDQG0RUDJZHUHERUQLQXVLQJWKHWHFKQLTXH7KHGLIIHUHQFHZDV
WKDW 'ROO\ ZDV GHULYHG IURP DQ DGXOW VKHHS DQG 0HJDQ DQG 0RUDJ ZHUH IURP D VKHHS
HPEU\R

&ORQLQJRI'ROO\

,Q  'ROO\ WKH VKHHS EHFDPH WKH ILUVW YHUWHEUDWH FORQHG IURP WKH FHOO RI DQ DGXOW
DQLPDO 1RW RQO\ ZDV WKLV UHPDUNDEOH VFLHQWLILF EUHDNWKURXJK EXW LW LPPHGLDWHO\ JDLQHG
LQWHUHVWDQGFRQFHUQIURPDURXQGWKHZRUOGRQWKHIXWXUHRIFORQLQJWHFKQRORJ\DVLWZRXOG
DIIHFWKXPDQV

'ROO\ PDGH IURQW SDJHV DURXQG WKH ZRUOG EHFDXVH RI KHU VWDUWOLQJ SHGLJUHH 'ROO\
XQOLNHDQ\RWKHUPDPPDOWKDWKDVHYHUOLYHGLVDQLGHQWLFDOFRS\RIDQRWKHUDGXOWDQGKDVQR
IDWKHU6KHLVDFORQHWKHFUHDWLRQRIDJURXSRIYHWHULQDU\UHVHDUFKHUV7KDWZRUNSHUIRUPHG
E\,DQ:LOPXWDQGKLVFROOHDJXHVDWWKH5RVOLQ,QVWLWXWHLQ(GLQEXUJK6FRWODQGKDVSURYLGHG
DQLPSRUWDQWQHZUHVHDUFKWRRO DQGKDVVKDWWHUHGDEHOLHIZLGHVSUHDGDPRQJELRORJLVWVWKDW
FHOOVIURPDGXOWPDPPDOVFDQQRWEHSHUVXDGHGWRUHJHQHUDWHDZKROHDQLPDO$OWKRXJKWKH
6FRWWLVK UHVHDUFKHUV KDYH PDGH FOHDU WKDW WKH\ ZRXOG FRQVLGHU LW XQHWKLFDO WR DGDSW WKHLU
WHFKQLTXHWRFORQHKXPDQV :LOPXWLVDPHPEHURIDZRUNLQJJURXSRQWKHHWKLFVRIJHQHWLF
HQJLQHHULQJ WKHGHPRQVWUDWLRQKDVUDLVHGWKHXQFRPIRUWDEOHSURVSHFWWKDWRWKHUVPLJKWQRW
EHVRVFUXSXORXV

7KHSURFHVVWKDWSURGXFHG'ROO\GLIIHUVIURPRUGLQDU\UHSURGXFWLRQLQWZRPDMRUZD\V
)LUVWERG\ RUVRPDWLF FHOOVIURPDQDGXOWHZH¶VXGGHU WKLVLVWKHGRQRU ZHUHSODFHGLQD
FXOWXUHGLVKDQGDOORZHGWRJURZ7KHQXWULHQWVZHUHWKHQUHPRYHGIURPWKHFXOWXUHZKLFK
VWRSSHGWKHFHOOV¶JURZWK2QHRIWKHVHQRQJURZLQJFHOOVZDVWKHQIXVHG E\HOHFWULFMROWV 
ZLWK DQRWKHU HZH¶V RRF\WH IURP ZKLFK WKH QXFOHXV KDG EHHQ SUHYLRXVO\ UHPRYHG LH
HQXFOHDWHG VR LW KDG QR FKURPRVRPHV  7KLV SURFHGXUH LV NQRZQ DV µVRPDWLF FHOO QXFOHDU
WUDQVIHU¶ :LWKLQ D GD\ WKH IXVHG FHOOV EHJDQ WR GLYLGH LQ WKH FXOWXUH GLVK $IWHU VHYHUDO
GLYLVLRQVWKHHDUO\HPEU\RZDVWUDQVIHUUHGWRWKHXWHUXVRIDVXUURJDWHPRWKHUDQGDOORZHGWR
GHYHORS

6HFRQG XQOLNH WKH VSHUP DQG WKH HJJ HDFK RI ZKLFK FRQWULEXWHV KDOI WKH QXPEHU RI
FKURPRVRPHVDWIHUWLOL]DWLRQHDFK ERG\ FHOO FRQWDLQVWZLFHWKHQXPEHURIFKURPRVRPHVLQ
HDFK JHUP FHOO 6R IXVLRQ RI D VSHUP DQG DQ HJJ IRUPV DQ LQGLYLGXDO ZKRVH IXOO JHQHWLF
FRPSRVLWLRQ LV XQLTXH WR WKDW LQGLYLGXDO &RQYHUVHO\ WKH HPEU\R FORQHG IURP VRPDWLF FHOO
QXFOHDU WUDQVIHU EHJLQV GHYHORSPHQW ZLWKWKHGLSORLG GRXEOH  QXPEHU RI FKURPRVRPHV DOO
GHULYHGIURPRQHVRPDWLFFHOO DGXOWXGGHU RIDVLQJOHLQGLYLGXDO7KLVHPEU\RKDVWKHVDPH
QXFOHDU JHQHWLF FRPSRVLWLRQ DV WKH GRQRU RI WKH VRPDWLF FHOO ,Q WKH HQG WKUHH VKHHS
FRQWULEXWHGWRWKHSURGXFWLRQRIDVLQJOHODPEFORQHD)LQQ'RUVHWVKHHSGRQDWHGKHUXGGHU
FHOOVIRUFXOWXUHD6FRWWLVK%ODFNIDFHVKHHSGRQDWHGWKHHQXFOHDWHGRRF\WH ZLWKLWVQXFOHXV
UHPRYHGWKXVORVLQJLWVRZQJHQHWLFLGHQWLW\LQWKHSURFHVV DQGD6FRWWLVK%ODFNIDFHVKHHS
EHFDPHWKHVXUURJDWHPRWKHUFDUU\LQJWKHHPEU\RWRELUWK )LJ 


Ϯϳϳ

 

)LJ&ORQLQJRI'ROO\





Ϯϳϴ

 
)LJ'ROO\¶V*HQHRORJ\DQG2IIVSULQJ

7KHFORQH 'ROO\ ZDVHDVLO\LGHQWLILHGEHFDXVHVKHKDGWKHSK\VLFDOWUDLWVRIWKH)LQQ
'RUVHW VKHHS WKDW GRQDWHG WKH XGGHU FHOOV DQG GLIIHUHG IURP WKH WUDLWV RI WKH 6FRWWLVK
%ODFNIDFHVKHHSXVHGDVWKHVXUURJDWHPRWKHUDQGWKHRRF\WHGRQRU$QGQRZ'ROO\KHUVHOILV
DPRWKHUWKHROGIDVKLRQHGZD\E\PDWLQJ ZLWK 'DYLG )LJ  D :HOVKPRXQWDLQ UDP DQG
JLYLQJELUWKWR%RQQLH )LJ ,QIDFW%RQQLHQRZKDVRWKHUVLEOLQJV


Ϯϳϵ

 

)LJ'ROO\ZLWKKHUILUVWVRQ%RQQLH



(QGRI'ROO\

2Q )HEUXDU\   'ROO\ ZDV SXW WR VOHHS 6KH ZDV  \HDUV ROG DQG KDG EHHQ
GLDJQRVHGZLWKSURJUHVVLYHOXQJGLVHDVH

:DVLWDQHDUO\GHDWKZDVLWEHFDXVHVKHZDVDFORQH"

6KHHSOLYH\HDUVDQG'ROO\FDPHIURPD\HDUVROGHZH7KHWHORPHUDVHVZHUH
VKRUWHU DVWKHDJLQJSURORQJVWHORPHUDVHVEHFRPHVKRUWHULQOHQJWK 
/XQJGLVHDVHLVFRPPRQLQROGHUVKHHS6KHKDGDUWKULWLVRQKHUKLQGOHJV

'ROO\¶VSUREDELOLW\

x &HOOVWDNHQIURPDVL[\HDUROG)LQQLVK'RUVHWHZHDQGFXOWXUHGLQDODE
x FHOOVWKHQIXVHGZLWKXQIHUWLOL]HGHJJV HDFKZLWKWKHQXFOHXVUHPRYHG 
x  YLDEOH UHFRQVWUXFWHG HJJV VXUYLYHG DQG ZHUH LPSODQWHG LQ VXUURJDWH %ODFNIDFH
HZHV
x JDYHELUWKWR'ROO\
x  FKDQFH DW RQVHW  RQFH LPSODQWHG  ,Q QDWXUH EHWZHHQ  RI
IHUWLOL]HGHJJVGHYHORS




ϮϴϬ


6XPPDU\'ROO\&ORQLQJ

,DQ :LOPXW DQG KLV FROOHDJXHV DW 6FRWODQG V 5RVOLQ ,QVWLWXWH VWXQQHG WKH VFLHQWLILF
FRPPXQLW\E\DQQRXQFLQJWKHILUVWFORQLQJRIDPDPPDO'ROO\WKHODPE&RQFHUQDERXWWKH
SRWHQWLDODSSOLFDWLRQRIVLPLODUFORQLQJWHFKQRORJ\WRKXPDQVTXLFNO\VSUHDGWKURXJKPDQ\
GLYHUVH FRPPXQLWLHV ,Q UHVSRQVH D PXOWLGLVFLSOLQDU\ SDQHO FRQVLVWLQJ RI PHPEHUV RI WKH
VFLHQWLILFPHGLFDOOHJDODQGHWKLFVFRPPXQLWLHVFRQYHQHGDW6WDQIRUG8QLYHUVLW\RQ0DUFK
IRUDSXEOLFGLVFXVVLRQ


'ROO\ZDVFUHDWHGE\WKHIXVLRQRIDQDGXOWHZH VPDPPDU\FHOO GRQRUFHOO ZLWKDQ
HQXFOHDWHG XQIHUWLOL]HG HZH HJJ RRF\WH  7KH GRQRU FHOO VXSSOLHV WKH GLSORLG JHQRPLF
'1$ DQG WKH RRF\WH VXSSOLHV WKH PDWHUQDO IDFWRUV QHHGHG IRU SURSHU HPEU\RQLF
GHYHORSPHQW%HIRUHIXVLRQ WKH GRQRU FHOO LVFXOWXUHG ZLWK YHU\ IHZ QXWULHQWV UHVXOWLQJ LQ
DUUHVW RIWKHGRQRUFHOOLQDQLQDFWLYHRUTXLHVFHQWVWDWH7KH '1$ RIWKH TXLHVFHQW GRQRU
FHOO LV WKXV UHSURJUDPPHG EHFDXVH JHQH H[SUHVVLRQ LQYROYHG LQ GHWHUPLQLQJ FHOOXODU
LGHQWLW\LVWXUQHGRII

)XVLRQRIWKHGRQRUFHOODQGRRF\WHLVLQGXFHGXVLQJDVHULHVRIHOHFWULFSXOVHV7KHVH
SXOVHV DOVR VLPXODWH WKH DFWLYDWLRQ VLJQDOV QRUPDOO\ DVVRFLDWHG ZLWK IHUWLOL]DWLRQ ZKLFK
FDXVHV WKH QHZO\ IXVHG FHOO WR LQLWLDWH HPEU\RQLF GHYHORSPHQW 7KH GHYHORSLQJ HPEU\R LV
FXOWXUHGLILWVXUYLYHVDQGFRQWLQXHVWRGHYHORSDIWHUVL[GD\VRIFXOWXUHLWLVWUDQVIHUUHGWRD
UHFLSLHQW HZH 7KH HPEU\R LV WKHQ FDUULHG WR WHUP 2XW RI WZHQW\QLQH LPSODQWHG HPEU\RV
SURGXFHGE\WKLVPHWKRGRQO\RQHUHVXOWHGLQDOLYHELUWK


'ROO\ V ELUWK UDLVHV LQWHUHVWLQJ VFLHQWLILF TXHVWLRQV )RU LQVWDQFH LW UHPDLQV XQFOHDU
ZKLFKW\SHVRIDGXOWFHOOVKDYHWKHDELOLW\WRIXQFWLRQDVGRQRUFHOOV$GXOWPDPPDOLDQFHOOV
FDQ EH DW YDU\LQJ VWDJHV RI LGHQWLW\ GHWHUPLQDWLRQ GLIIHUHQWLDWLRQ  &HOOV WKDW DUH LQ WKH
HDUO\ VWDJHV RI GLIIHUHQWLDWLRQ PD\ EH PRUH VXVFHSWLEOH WR WKH FORQLQJ SURFHGXUH V
UHSURJUDPPLQJVWHS$VWKH5RVOLQVFLHQWLVWVGRQRWNQRZWKHH[DFWLGHQWLW\RIWKHGRQRUFHOO
WKDW FRQWULEXWHG WKH JHQRPLF '1$ WR 'ROO\ WKH H[WHQW RI GHGLIIHUHQWLDWLRQ UHTXLUHG WR
VXIILFLHQWO\UHSURJUDPDGRQRUFHOOLVXQNQRZQ7KXVWKHW\SHVRIDGXOWGRQRUFHOOVXVHIXOLQ
WKHFORQLQJSURFHGXUHPD\EHOLPLWHG


7KHDJHRIWKHGRQRUFHOOPD\DOVROLPLWWKHDELOLW\RIWKHGRQRUFHOO VJHQRPLF'1$WR
GLUHFW QRUPDO GHYHORSPHQW 'XULQJ WKH DJLQJ SURFHVV FHOOV QDWXUDOO\ DFTXLUH JHQHWLF
PXWDWLRQVWKHVHPXWDWLRQVDUHRIWHQVLOHQWDQGKDYHOLWWOHRYHUWSK\VLRORJLFDOHIIHFWLQDQ
DGXOW6XFKPXWDWLRQVKRZHYHUFRXOGEHGHYDVWDWLQJLQDQHDUO\HPEU\R7KHDFFXPXODWHG
PXWDWLRQV RI DQ ROGHU GRQRU FHOO FRXOG DUUHVW HPEU\RQLF GHYHORSPHQW RU UHVXOW LQ VHYHUH
GHYHORSPHQWDODEQRUPDOLWLHVLQWKHFORQH$GRQRUFHOOIURPDQHLJKW\\HDUROGKXPDQPD\
WKHUHIRUHEHGDQJHURXVWRXVHLQFORQLQJ

$OWKRXJK 'ROO\ LV WKHRUHWLFDOO\ DQ H[DFW FORQH RI WKH HZH GRQDWLQJ WKH JHQRPLF
'1$RWKHUIDFWRUVSUHYHQW'ROO\IURPEHLQJDFRPSOHWHGXSOLFDWH)LUVWWKHJHQRPLF'1$
PD\KDYHLQFXUUHGGDPDJHGXULQJWKHFORQLQJSURFHGXUHWKXV'ROO\PD\QRWEHJHQHWLFDOO\
HTXLYDOHQW WR WKH GRQRU FHOO HZH 6HFRQG 'ROO\ V JHQRPLF '1$ ZDV H[SRVHG WR WKH
PDWHUQDOO\FRQWULEXWHGFRQWHQWVRIWKHRRF\WHZKLFKPD\IXQGDPHQWDOO\DIIHFWGHYHORSPHQW

ϮϴϮ

7KH RRF\WHFRQWHQWVDOVR LQFOXGHPLWRFKRQGULDZKLFKFRQWDLQ WKHLU RZQ DFWLYHO\ H[SUHVVHG
'1$ )LQDOO\ 'ROO\ ZDV H[SRVHG WR D ZRPE HQYLURQPHQW GLIIHUHQW IURP WKH ZRPE
HQYLURQPHQWLQZKLFKWKHGRQRUFHOOHZHGHYHORSHG7KXVHPEU\RQLFGHYHORSPHQWGHSHQGV
XSRQWKHVHIDFWRUVDVZHOODVWKHDFWXDOVHTXHQFHRIWKHJHQRPLF'1$'ROO\PD\EHTXLWH
GLIIHUHQWIURPWKHGRQRUFHOOHZH


7KHFORQLQJ RI 'ROO\ UDLVHVD QXPEHU RI VHULRXV TXHVWLRQV DQG FRQFHUQV 7KH VFLHQFH
XVHGWRSURGXFH'ROO\LVQRWZHOOXQGHUVWRRGDQGKHUVWDWXVDVDGXSOLFDWHUHPDLQVXQFOHDU
GXH WR WKH QXPHURXV LQIOXHQFHV XSRQ KHU HPEU\RQLF GHYHORSPHQW 'ROO\ ZLOO QHHG WR EH
H[DPLQHGIRUDQ\SRWHQWLDOLOOHIIHFWVDVVRFLDWHGZLWKWKHFORQLQJSURFHGXUH7KHOLIHVSDQRI
KHUFHOOVKHUORQJHYLW\DVDQDQLPDODQGKHUIHUWLOLW\VKRXOGDOOEHFORVHO\PRQLWRUHG)LQDOO\
WKH IXWXUH OHJDO VWDWXV RI KXPDQ FORQLQJ UHVHDUFK QHHGV WR EH UHVROYHG LQ DQ LQIRUPHG DQG
WLPHO\PDQQHU


5HIHUHQFHV

&ORQLQJ +RZ )DU 6KRXOG :H *R" +HDULQJ EHIRUH WKH 6XEFRPP RQ 7HFKQRORJ\ RI WKH
&RQJ&RPP2Q6FLHQFHWK&RQJVW6HVV  
+5WK&RQJVW6HVV  DQG+5WK&RQJVW6HVV  
,DQ :LOPXW HW DO 9LDEOH RIIVSULQJ GHULYHG IURP IHWDO DQG DGXOW PDPPDOLDQ FHOOV 
1$785(  
.DWKHULQH46HHO\H*23/DZPDNHU3URSRVHV%LOOWR%DQ+XPDQ&ORQLQJ1<7,0(6
0DUDW%
3UHVLGHQW V0HPRUDQGXPIRUWKH+HDGVRI([HFXWLYH'HSDUWPHQWVDQG$JHQFLHV3UHVLGHQW V
0HPRUDQGXP IRU WKH +HDGV RI ([HFXWLYH 'HSDUWPHQWV DQG $JHQFLHV 'LUHFWLYH RQ
&ORQLQJ0DUFK /(;,6*HQIHGOLEUDU\([HFILOH 
5LFN:HLVV&OLQWRQ)RUELGV)XQGLQJRI+XPDQ&ORQH6WXGLHV:$6+32670DU
DW$




















Ϯϴϯ



&KDSWHU

,QYLWUR)HUWLOL]DWLRQ

,QWURGXFWLRQ

7R XQGHUVWDQG DVVLVWHG UHSURGXFWLRQ DQG KRZ LW FDQ KHOS LQIHUWLOH FRXSOHV LW LV
LPSRUWDQWWRXQGHUVWDQGKRZ FRQFHSWLRQ WDNHV SODFHQDWXUDOO\ )RUWUDGLWLRQDOFRQFHSWLRQWR
RFFXU WKH PDQ PXVW HMDFXODWH KLV VHPHQ WKH IOXLG FRQWDLQLQJ WKH VSHUP LQWR WKH ZRPDQ V
YDJLQDDURXQGWKHWLPHRIRYXODWLRQZKHQKHURYDU\UHOHDVHVDQHJJ2YXODWLRQLVDFRPSOH[
HYHQWFRQWUROOHGE\WKHSLWXLWDU\JODQGZKLFKLVORFDWHGDWWKHEDVHRIWKHEUDLQ7KHSLWXLWDU\
JODQG UHOHDVHV IROOLFOHVWLPXODWLQJ KRUPRQH )6+  ZKLFK VWLPXODWHV IROOLFOHV LQ RQH RI WKH
RYDULHV WR EHJLQ JURZLQJ 7KH IROOLFOH SURGXFHV WKH KRUPRQH HVWURJHQ DQG FRQWDLQV D
PDWXULQJ HJJ :KHQ DQ HJJ LV PDWXUH WKH SLWXLWDU\ JODQG VHQGV D VXUJH RI OXWHLQL]LQJ
KRUPRQH /+ WKDWFDXVHVWKHIROOLFOHWRUXSWXUHDQGUHOHDVH RYXODWH DPDWXUHHJJ )LJXUH
  )ROORZLQJ RYXODWLRQ WKH HJJ LV SLFNHG XS E\ RQH RI WKH IDOORSLDQ WXEHV %HFDXVH
IHUWLOL]DWLRQXVXDOO\WDNHVSODFHLQVLGHWKHIDOORSLDQWXEHWKHPDQ VVSHUPPXVWEHFDSDEOHRI
VZLPPLQJWKURXJKWKHYDJLQDDQGFHUYLFDOPXFXVXSWKHFHUYLFDOFDQDOLQWRWKHXWHUXVDQG
XS LQWRWKH IDOORSLDQWXEH ZKHUH LW PXVW SHQHWUDWH WKH HJJ WR IHUWLOL]HLW7KH IHUWLOL]HGHJJ
FRQWLQXHV WUDYHOLQJ WR WKH XWHUXV DQG LPSODQWV LQ WKH XWHULQH OLQLQJ ZKHUH LW FRQWLQXHV WR
GHYHORS





)LJXUH5HSURGXFWLRQ3URFHVV

Ϯϴϰ

 

,QYLWUR)HUWLOL]DWLRQ ,9) 

7KHUH DUH PDQ\ IDFWRUV WKDW FDQ SUHYHQW WKH XQLRQ RI VSHUP DQG HJJ )RUWXQDWHO\
DVVLVWHG UHSURGXFWLYH WHFKQLTXHV VXFK DV ,9) FDQ KHOS ,9) LV D PHWKRG RI DVVLVWHG
UHSURGXFWLRQLQZKLFKDPDQ VVSHUPDQGDZRPDQ VHJJVDUHFRPELQHGRXWVLGHRIWKHERG\
LQ D ODERUDWRU\ GLVK 2QH RU PRUH IHUWLOL]HG HJJV HPEU\RV  PD\ EH WUDQVIHUUHG WR WKH
ZRPDQ VXWHUXVZKHUHWKH\PD\LPSODQWLQWKHXWHULQHOLQLQJDQGGHYHORS([FHVVHPEU\RV
PD\ EH FU\RSUHVHUYHG IUR]HQ  IRU IXWXUH XVH ,QLWLDOO\ ,9) ZDV XVHG WR WUHDW ZRPHQ ZLWK
EORFNHG GDPDJHG RU DEVHQW IDOORSLDQ WXEHV 7RGD\ ,9) LV XVHG WR WUHDW PDQ\ FDXVHV RI
LQIHUWLOLW\ VXFK DV HQGRPHWULRVLV DQG PDOH IDFWRU RU ZKHQ D FRXSOH V LQIHUWLOLW\ LV
XQH[SODLQHG7KHEDVLFVWHSVLQDQ,9)WUHDWPHQWF\FOHDUHRYDULDQVWLPXODWLRQHJJUHWULHYDO
IHUWLOL]DWLRQHPEU\RFXOWXUHDQGHPEU\RWUDQVIHU

2YDULDQ6WLPXODWLRQ

'XULQJRYDULDQVWLPXODWLRQDOVRNQRZQDVRYXODWLRQLQGXFWLRQPHGLFDWLRQVRUIHUWLOLW\
GUXJVDUHXVHGWRVWLPXODWHPXOWLSOHHJJVWRJURZLQWKHRYDULHVUDWKHUWKDQWKHVLQJOHHJJ
WKDW QRUPDOO\ GHYHORSV HDFK PRQWK 7DEOH   0XOWLSOH HJJV DUH VWLPXODWHG EHFDXVH VRPH
HJJV ZLOO QRW IHUWLOL]H RU GHYHORS QRUPDOO\ DIWHU IHUWLOL]DWLRQ 7KH PD[LPXP QXPEHUV RI
HPEU\RV WUDQVIHUUHG DUHEDVHG RQ WKH SDWLHQW V DJH DQG RWKHU LQGLYLGXDO SDWLHQW DQG HPEU\R
FKDUDFWHULVWLFV%HFDXVHHDFKHPEU\RKDVDSUREDELOLW\RILPSODQWDWLRQDQGGHYHORSPHQWWKH
QXPEHURIHPEU\RVWREHSODFHGVKRXOGEHGHWHUPLQHGIRUHDFKSDWLHQW WDNLQJLQWRDFFRXQW
WKH RGGV RI DFKLHYLQJ D SUHJQDQF\ EDVHG RQ WKH QXPEHU RI HPEU\RV WUDQVIHUUHG ZHLJKHG
DJDLQVWWKHULVNRIPXOWLSOHJHVWDWLRQ 7DEOH 


7DEOH
0HGLFDWLRQVIRU2YDULDQ6WLPXODWLRQ
x FORPLSKHQHFLWUDWH &ORPLGŠ6HURSKHQHŠ 
x OHWUR]ROH )HPDUD 
x IROOLFOHVWLPXODWLQJKRUPRQH )6+  )ROOLVWLP70*RQDO)Š%UDYHOOH70 
x KXPDQPHQRSDXVDOJRQDGRWURSLQV K0*  +XPHJRQ705HSURQH[700HQRSXUŠ 
x OXWHLQL]LQJKRUPRQH /+  /XYHULVŠ 
0HGLFDWLRQVIRU2RF\WH0DWXUDWLRQ
x KXPDQ FKRULRQLF JRQDGRWURSLQ K&*  3URIDVLŠ $3/Š 3UHJQ\OŠ 1RYDUHO70
2YLGUHOŠ 
0HGLFDWLRQVWR3UHYHQW3UHPDWXUH2YXODWLRQ
x *Q5+DJRQLVWV /XSURQŠDQG6\QDUHOŠ 
x *Q5+DQWDJRQLVWV $QWDJRQŠ*DQDUHOL[ŠDQG&HWURWLGHŠ 



&ORPLSKHQHFLWUDWHLVDGPLQLVWHUHGRUDOO\ZKLOHWKHRWKHUPHGLFDWLRQVOLVWHGDUHJLYHQ
E\ LQMHFWLRQ &ORPLSKHQH FLWUDWH LV OHVV SRWHQW WKDQ LQMHFWDEOH PHGLFDWLRQV DQG LV QRW DV
FRPPRQO\ XVHG LQ $57 F\FOHV 7KHUH LV QR HYLGHQFH WKDW RQH LQMHFWDEOH PHGLFDWLRQ LV
VXSHULRUWRDQ\RWKHU

0HGLFDWLRQVIRU,QGXFLQJ2YXODWLRQ
Ϯϴϱ


7LPLQJ LV FUXFLDO LQ DQ ,9) F\FOH 7KH RYDULHV DUH HYDOXDWHG GXULQJ WUHDWPHQW ZLWK
YDJLQDOXOWUDVRXQGH[DPLQDWLRQVWRPRQLWRUWKHGHYHORSPHQWRIRYDULDQIROOLFOHV )LJXUH 
%ORRG VDPSOHV PD\ EH GUDZQ WR PHDVXUH UHVSRQVH WR RYDULDQ VWLPXODWLRQ PHGLFDWLRQV
1RUPDOO\HVWURJHQOHYHOVLQFUHDVHDV WKHIROOLFOHVGHYHORSDQGSURJHVWHURQH OHYHOV DUH ORZ
XQWLODIWHURYXODWLRQ






)LJXUH2YDULDQIROOLFOHVVWLPXODWHGE\RYXODWLRQGUXJVYLVLEOHRQXOWUDVRXQG
7KHGDUNFLUFXODUDUHDVDUHWKHIROOLFOHV


8VLQJXOWUDVRXQGH[DPLQDWLRQVDQGEORRGWHVWLQJWKHSK\VLFLDQFDQGHWHUPLQHZKHQWKH
IROOLFOHVDUHDSSURSULDWHIRUHJJUHWULHYDO*HQHUDOO\HLJKWWRGD\V LVUHTXLUHG:KHQWKH
IROOLFOHV DUH UHDG\ K&* RU RWKHU PHGLFDWLRQV DUH JLYHQ 7KH K&* UHSODFHV WKH ZRPDQ V
QDWXUDO/+VXUJHDQGFDXVHVWKHILQDOVWDJHRIHJJPDWXUDWLRQVRWKHHJJVDUHFDSDEOHRIEHLQJ
IHUWLOL]HG 7KH HJJV DUH UHWULHYHG EHIRUH RYXODWLRQ RFFXUV XVXDOO\  WR  KRXUV DIWHU WKH
K&*LQMHFWLRQLVJLYHQ

8S WR  RI F\FOHV PD\ EH FDQFHOOHG EHIRUH HJJ UHWULHYDO ,9) F\FOHV PD\ EH
FDQFHOOHG IRU D YDULHW\ RI UHDVRQV XVXDOO\ GXH WR DQ LQDGHTXDWH QXPEHU RI IROOLFOHV
GHYHORSLQJ&DQFHOODWLRQUDWHVGXHWRORZUHVSRQVHWRWKHRYXODWLRQGUXJVLQFUHDVHZLWKDJH
HVSHFLDOO\ DIWHU DJH  :KHQ F\FOHV DUH FDQFHOOHG GXH WR D SRRU UHVSRQVH DOWHUQDWH GUXJ
VWUDWHJLHV PD\ EH KHOSIXO WR SURPRWH D EHWWHU UHVSRQVH LQ D IXWXUH DWWHPSW 2FFDVLRQDOO\ D
F\FOHPD\EHFDQFHOOHGWRUHGXFHWKHULVNRIRYDULDQK\SHUVWLPXODWLRQV\QGURPH 2+66 

7UHDWPHQWZLWKD*Q5+DJRQLVWRUDQWDJRQLVWUHGXFHVWKHSRVVLELOLW\RISUHPDWXUH/+
VXUJHV IURP WKH SLWXLWDU\ JODQG DQG WKHUHE\ UHGXFHV WKH ULVN RI SUHPDWXUH RYXODWLRQ
+RZHYHU/+VXUJHVDQGRYXODWLRQRFFXUSUHPDWXUHO\LQDVPDOOSHUFHQWDJHRI$57F\FOHV
GHVSLWHWKHXVHRIWKHVHGUXJV:KHQWKLVRFFXUVDVLWLVXQNQRZQZKHQWKH/+VXUJHVEHJDQ

Ϯϴϲ

DQGHJJVZLOO PDWXUH WKHF\FOHLV XVXDOO\ FDQFHOOHG&ROOHFWLRQRIHJJV IURPWKHSHULWRQHDO
FDYLW\DIWHURYXODWLRQLVQRWHIILFLHQW

(JJ5HWULHYDO

(JJ UHWULHYDO LV XVXDOO\ DFFRPSOLVKHG E\ WUDQVYDJLQDO XOWUDVRXQG DVSLUDWLRQ D PLQRU
VXUJLFDO SURFHGXUH WKDW FDQ EH SHUIRUPHG LQ WKH SK\VLFLDQ V RIILFH RU DQ RXWSDWLHQW FHQWHU
6RPH IRUP RI DQDOJHVLDLV JHQHUDOO\ DGPLQLVWHUHG $Q XOWUDVRXQG SUREH LV LQVHUWHG LQWR WKH
YDJLQDWRLGHQWLI\WKHIROOLFOHVDQGDQHHGOHLVJXLGHGWKURXJKWKHYDJLQDDQGLQWRWKHIROOLFOHV
)LJXUH 7KHHJJVDUHDVSLUDWHG UHPRYHG IURPWKHIROOLFOHVWKURXJKWKHQHHGOHFRQQHFWHG
WR D VXFWLRQ GHYLFH 5HPRYDO RI PXOWLSOH HJJV FDQ XVXDOO\ EH FRPSOHWHG LQ OHVV WKDQ 
PLQXWHV

6RPHZRPHQH[SHULHQFHFUDPSLQJRQWKHGD\RIWKHUHWULHYDOEXWWKLVVHQVDWLRQXVXDOO\
VXEVLGHV E\ WKH QH[W GD\ )HHOLQJV RI IXOOQHVV DQGRU SUHVVXUH PD\ ODVW IRU VHYHUDO ZHHNV
IROORZLQJWKHSURFHGXUHEHFDXVHWKHRYDULHVUHPDLQHQODUJHG,QVRPHFLUFXPVWDQFHVRQHRU
ERWK RYDULHV PD\ QRW EH DFFHVVLEOH E\ WUDQVYDJLQDO XOWUDVRXQG /DSDURVFRS\ PD\ WKHQ EH
XVHGWRUHWULHYHWKHHJJVXVLQJDVPDOOWHOHVFRSHSODFHGLQWKHXPELOLFXV




)LJXUH(JJUHWULHYDOLVXVXDOO\SHUIRUPHGWKURXJKWKHYDJLQDZLWKDQ
XOWUDVRXQGJXLGHGQHHGOH



)HUWLOL]DWLRQDQG(PEU\R&XOWXUH


Ϯϴϳ

 $IWHU WKH HJJV DUH UHWULHYHG WKH\ DUH H[DPLQHG LQ WKH ODERUDWRU\ IRU PDWXULW\ DQG
TXDOLW\0DWXUH HJJV )LJXUH   DUH SODFHG LQ DQ ,9) FXOWXUH PHGLXPDQG WUDQVIHUUHGWR DQ
LQFXEDWRUWRDZDLWIHUWLOL]DWLRQE\WKHVSHUP

6SHUPLVVHSDUDWHGIURPVHPHQXVXDOO\REWDLQHGE\HMDFXODWLRQRULQDVSHFLDOFRQGRP
XVHG GXULQJ LQWHUFRXUVH $OWHUQDWLYHO\ VSHUP PD\ EH REWDLQHG IURP WKH WHVWLFOH RU YDV
GHIHUHQV IURP PHQ ZKRVH VHPHQ LV YRLG RI VSHUP HLWKHU GXH WR DQ REVWUXFWLRQ RU ODFN RI
SURGXFWLRQ

)HUWLOL]DWLRQ PD\ EH DFFRPSOLVKHG E\ LQVHPLQDWLRQ ZKHUH PRWLOH VSHUP DUH SODFHG
WRJHWKHU ZLWK WKH RRF\WHV DQG LQFXEDWHG RYHUQLJKW RU E\ LQWUDF\WRSODVPLF VSHUP LQMHFWLRQ
,&6,  ZKHUH D VLQJOH VSHUP LV GLUHFWO\ LQMHFWHG LQWR HDFK PDWXUH HJJ )LJXUH   ,Q WKH
8QLWHG 6WDWHV ,&6, LV SHUIRUPHG LQ DSSUR[LPDWHO\  RI $57 F\FOHV ,&6, LV XVXDOO\
SHUIRUPHGZKHQWKHUHLVDOLNHOLKRRGRIUHGXFHGIHUWLOL]DWLRQLHSRRUVHPHQTXDOLW\KLVWRU\
RIIDLOHGIHUWLOL]DWLRQLQDSULRU,9)F\FOHHWF

2YHUDOO SUHJQDQF\ DQG GHOLYHU\ UDWHV ZLWK ,&6, DUH VLPLODU WR WKH UDWHV VHHQ ZLWK
WUDGLWLRQDO ,9) *HQHWLF FRXQVHOLQJ LV DGYLVDEOH EHIRUH ,&6, LI LQKHULWHG DEQRUPDOLWLHV DUH
LGHQWLILHGWKDWPD\EHSDVVHGIURPIDWKHUWRVRQ



)LJXUH$PDWXUHXQIHUWLOL]HGHJJ



9LVXDOL]DWLRQRIWZRSURQXFOHLWKHIROORZLQJGD\FRQILUPVIHUWLOL]DWLRQRIWKHHJJ2QH
SURQXFOHLLVGHULYHGIURPWKHHJJDQGRQHIURPWKHVSHUP$SSUR[LPDWHO\WRRIWKH
PDWXUH HJJV ZLOO IHUWLOL]H DIWHU LQVHPLQDWLRQ RU ,&6, /RZHU UDWHV PD\ RFFXU LI WKH VSHUP
DQGRUHJJTXDOLW\DUHSRRU2FFDVLRQDOO\IHUWLOL]DWLRQGRHVQRWRFFXUDWDOOHYHQLI,&6,ZDV
XVHG

Ϯϴϴ

 7ZRGD\VDIWHUWKHHJJUHWULHYDOWKHIHUWLOL]HGHJJKDVGLYLGHGWREHFRPHDWRFHOO
HPEU\R )LJXUH   %\ WKH WKLUG GD\ D QRUPDOO\ GHYHORSLQJ HPEU\R ZLOO FRQWDLQ
DSSUR[LPDWHO\  WR  FHOOV %\ WKH ILIWK GD\ D IOXLG FDYLW\ IRUPV LQ WKH HPEU\R DQG WKH
SODFHQWD DQG IHWDO WLVVXHV EHJLQ WR VHSDUDWH $Q HPEU\R DW WKLV VWDJH LV FDOOHG D EODVWRF\VW
(PEU\RVPD\EHWUDQVIHUUHGWRWKHXWHUXVDWDQ\WLPHEHWZHHQRQHWRVL[GD\VDIWHUWKHHJJ
UHWULHYDO ,I VXFFHVVIXO GHYHORSPHQW FRQWLQXHV LQ WKH XWHUXV WKH HPEU\R KDWFKHV IURP WKH
VXUURXQGLQJ]RQDSHOOXFLGDDQGLPSODQWVLQWRWKHOLQLQJRIWKHXWHUXVDSSUR[LPDWHO\VL[WR
GD\VDIWHUWKHHJJUHWULHYDO




)LJXUH,QWUDF\WRSODVPLFVSHUPLQMHFWLRQ ,&6, LQZKLFKDVSHUPLVLQMHFWHG
GLUHFWO\LQWRDQHJJWRIDFLOLWDWHIHUWLOL]DWLRQ




)LJXUH$IHUWLOL]HGHJJWKDWKDVGLYLGHGRQFHDQGLVQRZDWZRFHOOHPEU\R



$VVLVWHGKDWFKLQJ $+ 


Ϯϴϵ

 $VVLVWHGKDWFKLQJ $+ LVDPLFURPDQLSXODWLRQSURFHGXUHLQ ZKLFKD KROH LV PDGH LQ
WKH]RQDSHOOXFLGDMXVWEHIRUHHPEU\RWUDQVIHUWRIDFLOLWDWHKDWFKLQJRIWKHHPEU\R$OWKRXJK
$+KDVQRWEHHQGHPRQVWUDWHGGHILQLWLYHO\WRLPSURYHOLYHELUWKUDWHV$+PD\EHXVHGIRU
ROGHUZRPHQRUFRXSOHVZKRKDYHIDLOHGSULRU,9)DWWHPSWV7KHUHLVQRFOHDUEHQHILWRI$+
WRLPSURYHSUHJQDQF\RUOLYHELUWKUDWHVLQRWKHUJURXSVRI,9)SDWLHQWV

3UHLPSODQWDWLRQJHQHWLFGLDJQRVLV 3*' 

3UHLPSODQWDWLRQ JHQHWLF GLDJQRVLV 3*'  LV SHUIRUPHG DW VRPH FHQWUHV WR VFUHHQ IRU
LQKHULWHG GLVHDVHV ,Q 3*'RQH RU WZRFHOOV DUH UHPRYHGIURP WKH GHYHORSLQJ HPEU\R DQG
WHVWHGIRUDVSHFLILFJHQHWLFGLVHDVH(PEU\RVWKDWGRQRWKDYHWKHJHQHDVVRFLDWHGZLWKWKH
GLVHDVHDUHVHOHFWHGIRUWUDQVIHUWRWKHXWHUXV7KHVHSURFHGXUHVUHTXLUHVSHFLDOL]HGHTXLSPHQW
DQGH[SHULHQFHDQG,9)LQDFRXSOHZKRPD\QRWQHHG,9)WRFRQFHLYH

7KHEHQHILWRIVFUHHQLQJWKHHPEU\RVIRUGLVHDVHLQFRXSOHVDWULVNDQGUHGXFLQJWKHULVN
RIKDYLQJDQDIIHFWHGFKLOGRUWHUPLQDWLQJDSUHJQDQF\LVSUHIHUHDEOHWRVRPHFRXSOHV:KLOH
3*' FDQUHGXFH WKH OLNHOLKRRG RI FRQFHLYLQJ D SUHJQDQF\ ZLWK DQ DIIHFWHGFKLOG LW FDQQRW
HOLPLQDWH WKH ULVN &RQILUPDWLRQ ZLWK FKRULRQLF YLOOXV VDPSOLQJ &96  DPQLRFHQWHVLV RU
RWKHUWHVWLQJLVVWLOOQHFHVVDU\

(PEU\R7UDQVIHU

7KH QH[W VWHS LQ WKH ,9) SURFHVV LV WKH HPEU\R WUDQVIHU 1R DQHVWKHVLD LV QHFHVVDU\
DOWKRXJKVRPHZRPHQPD\ZLVKWRKDYHDPLOGVHGDWLYH7KHSK\VLFLDQLGHQWLILHVWKHFHUYL[
XVLQJDYDJLQDOVSHFXOXP2QHRUPRUHHPEU\RVVXVSHQGHGLQDGURSRIFXOWXUHPHGLXPDUH
GUDZQ LQWR D WUDQVIHU FDWKHWHU D ORQJ WKLQ VWHULOH WXEH ZLWK D V\ULQJH RQ RQH HQG 7KH
SK\VLFLDQJHQWO\JXLGHVWKHWLSRIWKHWUDQVIHUFDWKHWHUWKURXJKWKHFHUYL[DQGSODFHVWKHIOXLG
FRQWDLQLQJWKHHPEU\RVLQWRWKHXWHULQHFDYLW\ )LJXUH 7KHSURFHGXUHLVXVXDOO\SDLQOHVV
DOWKRXJKVRPHZRPHQH[SHULHQFHPLOGFUDPSLQJ

$650 LVVXHV JXLGHOLQHV UHJDUGLQJ GHWHUPLQDWLRQ RI KRZ PDQ\ HPEU\RV VKRXOG EH
FRQVLGHUHGIRUWUDQVIHU7KHQXPEHURIHPEU\RVWUDQVIHUUHGLVODUJHO\EDVHGRQWKHDJHRIWKH
ZRPDQRURRF\WHGRQRUXQGHUJRLQJ,9)UHWULHYDO

7KHVH JXLGHOLQHV ZHUH FUHDWHG WR KHOS PDLQWDLQ WKH KLJK VXFFHVV UDWHV RI ,9) FHQWHUV
ZKLOHGHFUHDVLQJWKHQXPEHURIKLJKHURUGHUPXOWLSOHSUHJQDQFLHV WULSOHWVDQGKLJKHU 7KH
UHSURGXFWLYH HQGRFULQRORJLVW RU HPEU\RORJLVW ZLOO GLVFXVV WKLV ZLWK WKH SDWLHQW EHIRUH WKH
WUDQVIHU

&U\RSUHVHUYDWLRQ

([WUDHPEU\RVUHPDLQLQJDIWHUWKHHPEU\RWUDQVIHUPD\EHFU\RSUHVHUYHG IUR]HQ IRU
IXWXUHWUDQVIHU&U\RSUHVHUYDWLRQPDNHVIXWXUH$57F\FOHVVLPSOHUOHVVH[SHQVLYHDQGOHVV
LQYDVLYHWKDQWKHLQLWLDO,9)F\FOHEHFDXVHWKHZRPDQGRHVQRWUHTXLUHRYDULDQVWLPXODWLRQ
RU HJJ UHWULHYDO 2QFH IUR]HQ HPEU\RV PD\ EH VWRUHG IRU VHYHUDO \HDUV +RZHYHU QRW DOO
HPEU\RV VXUYLYH WKH IUHH]LQJ DQG WKDZLQJ SURFHVV DQG WKH OLYH ELUWK UDWH LV ORZHU ZLWK
FU\RSUHVHUYHGHPEU\RWUDQVIHU&RXSOHVVKRXOGGHFLGHLIWKH\DUHJRLQJWRFU\RSUHVHUYHH[WUD
HPEU\RVEHIRUHXQGHUJRLQJ,9)



ϮϵϬ

 
)LJXUH(PEU\RWUDQVIHULVSHUIRUPHGWKURXJKWKHFHUYL[

9DULDWLRQVRI,9)

*DPHWH LQWUDIDOORSLDQ WUDQVIHU *,)7  LV VLPLODU WR ,9) EXW WKH JDPHWHV HJJ DQG
VSHUP DUHWUDQVIHUUHGWRWKHZRPDQ VIDOORSLDQWXEHVUDWKHUWKDQKHUXWHUXVDQGIHUWLOL]DWLRQ
WDNHV SODFH LQ WKH WXEHV UDWKHU WKDQ LQ WKH ODE $QRWKHU GLIIHUHQFH LV WKDW ODSDURVFRS\ D
VXUJLFDOSURFHGXUHLVQHFHVVDU\WRWUDQVIHUWKHVSHUPDQGHJJWRWKHWXEHV*,)7LVDQRSWLRQ
RQO\ IRU ZRPHQ ZKR KDYH QRUPDO IDOORSLDQ WXEHV 6RPH FRXSOHV PD\ FRQVLGHU *,)7 IRU
UHOLJLRXVUHDVRQVEHFDXVHHJJVDUHQRWIHUWLOL]HGRXWVLGHWKHERG\2QHOLPLWDWLRQRI*,)7LV
WKDWIHUWLOL]DWLRQFDQQRWEHFRQILUPHGDVZLWK,9)7RGD\*,)7FRPSULVHVOHVVWKDQRI
$57SURFHGXUHVSHUIRUPHGLQWKH8QLWHG6WDWHV

$QRWKHU$57SURFHGXUHLV]\JRWHLQWUDIDOORSLDQWUDQVIHU =,)7 7KLVWHFKQLTXHGLIIHUV
IURP *,)7 LQ WKDW IHUWLOL]DWLRQ WDNHV SODFH LQ WKH ODE UDWKHU WKDQ WKH IDOORSLDQ WXEH EXW LV
VLPLODU LQ WKDW WKH IHUWLOL]HG HJJ LV WUDQVIHUUHG WR WKH WXEH UDWKHU WKDQ WKH XWHUXV 7KLV
SURFHGXUHDOVRUHTXLUHVDODSDURVFRS\7RGD\=,)7FRPSULVHVOHVVWKDQRI$57FDVHV
SHUIRUPHGLQWKH8QLWHG6WDWHV

6XFFHVV5DWHV

7KHPRVWUHFHQWUDWHVIRULQGLYLGXDO,9)SURJUDPVLQWKH8QLWHG6WDWHVDUHDYDLODEOHRQ
WKH,QWHUQHWIURPWKH6RFLHW\IRU$VVLVWHG5HSURGXFWLYH7HFKQRORJ\ 6$57 DWZZZVDUWRUJ
DQG IURP WKH &HQWHUV IRU 'LVHDVH &RQWURO DQG 3UHYHQWLRQ ZZZFGFJRYDUW $OWKRXJK WKLV
LQIRUPDWLRQLVUHDGLO\DYDLODEOHWKHUHVXOWVVKRXOGEHLQWHUSUHWHGFDUHIXOO\7KHVXFFHVVUDWHV
RIDQ,9)FHQWHUGHSHQGXSRQDQXPEHURIIDFWRUVDQGDFRPSDULVRQRIFOLQLFVXFFHVVUDWHVLV
QRWPHDQLQJIXOEHFDXVHSDWLHQWFKDUDFWHULVWLFVDQGWUHDWPHQWDSSURDFKHVYDU\IURPFOLQLFWR
FOLQLF )RU H[DPSOH WKH W\SH RI SDWLHQWV DFFHSWHG LQWR WKH SURJUDP DQG WKH QXPEHUV RI
HPEU\RVWUDQVIHUUHGSHUF\FOHDIIHFWVWKHSURJUDP VVWDWLVWLFV


Ϯϵϭ

 6WDWLVWLFVFDOFXODWHGRQVPDOOQXPEHUVRIF\FOHVPD\QRWEHDFFXUDWH$Q,9)FHQWHU V
UDWHV PD\ FKDQJH GUDPDWLFDOO\ RYHU WLPH DQG WKH FRPSLOHG VWDWLVWLFV PD\ QRW UHSUHVHQW D
SURJUDP VFXUUHQWVXFFHVV

,WLVDOVRLPSRUWDQWWRXQGHUVWDQGWKHGHILQLWLRQVRISUHJQDQF\UDWHVDQGOLYHELUWKUDWHV
)RUH[DPSOHDSUHJQDQF\UDWHRIGRHVQRWPHDQWKDWRIZRPHQWRRNEDELHVKRPH
3UHJQDQF\ GRHV QRW DOZD\V UHVXOW LQ OLYH ELUWK $ ELRFKHPLFDO SUHJQDQF\ LV D SUHJQDQF\
FRQILUPHGE\EORRGRUXULQHWHVWVEXWQRWYLVLEOHRQXOWUDVRXQGEHFDXVHWKHSUHJQDQF\VWRSV
GHYHORSLQJEHIRUHLWLVIDUHQRXJKDORQJWREHVHHQRQXOWUDVRXQG$FOLQLFDOSUHJQDQF\LVRQH
LQZKLFKWKHSUHJQDQF\LV VHHQ ZLWK XOWUDVRXQGEXW VWRSV GHYHORSLQJVRPHWLPHDIWHUZDUGV
7KHUHIRUHZKHQFRPSDULQJWKHSUHJQDQF\UDWHVRIGLIIHUHQWFOLQLFVLWLVLPSRUWDQWWRNQRZ
ZKLFKW\SHRISUHJQDQF\LVEHLQJFRPSDUHG

0RVWFRXSOHVDUHPRUHFRQFHUQHGZLWKDFOLQLF VOLYHELUWKUDWHZKLFKLVWKHSUREDELOLW\
RI GHOLYHULQJDOLYHEDE\SHU,9)F\FOHVWDUWHG 3UHJQDQF\UDWHVDQGPRUHLPSRUWDQWO\ OLYH
ELUWKUDWHVDUHLQIOXHQFHGE\DQXPEHURIIDFWRUVHVSHFLDOO\WKHZRPDQ VDJH

'RQRU6SHUP(JJVDQG(PEURV

,9)PD\EHGRQHZLWKDFRXSOH VRZQHJJVDQGVSHUP RUZLWK GRQRU HJJV VSHUP RU
HPEU\RV$FRXSOHPD\FKRRVHWRXVHDGRQRULIWKHUHLVDSUREOHPZLWKWKHLURZQVSHUPRU
HJJV RU LI WKH\ KDYH D JHQHWLF GLVHDVH WKDW FRXOG EH SDVVHG RQ WR D FKLOG 'RQRUV PD\ EH
NQRZQ RU DQRQ\PRXV ,Q PRVW FDVHV GRQRU VSHUP LV REWDLQHG IURP D VSHUP EDQN 6SHUP
GRQRUV XQGHUJR H[WHQVLYH PHGLFDO DQG JHQHWLF VFUHHQLQJ DV ZHOO DV WHVWLQJ IRU LQIHFWLRXV
GLVHDVHV 7KH VSHUP DUH IUR]HQ DQG TXDUDQWLQHG IRU VL[ PRQWKV WKH GRQRU LV UHWHVWHG IRU
LQIHFWLRXVGLVHDVHVLQFOXGLQJWKH$,'6YLUXVDQGVSHUPDUHRQO\UHOHDVHGIRUXVHLIDOOWHVWV
DUHQHJDWLYH'RQRUVSHUPPD\EHXVHGIRULQVHPLQDWLRQRULQDQ$57F\FOH

2YHUDOOWKHXVHRIIUR]HQVSHUPUDWKHUWKDQIUHVKVSHUPGRHVQRWORZHUVXFFHVVUDWHV
'RQRUHJJVDUHDQRSWLRQIRUZRPHQZLWK DXWHUXVZKRDUH XQOLNHO\ RU XQDEOH WR FRQFHLYH
ZLWKWKHLURZQHJJV(JJGRQRUVXQGHUJRWKHVDPHPHGLFDODQGJHQHWLFVFUHHQLQJDVVSHUP
GRQRUVDOWKRXJKLWLVQRWFXUUHQWO\SRVVLEOHWRIUHH]HDQGTXDUDQWLQHHJJVOLNHVSHUP7KHHJJ
GRQRUPD\EHFKRVHQE\WKHLQIHUWLOHFRXSOHRUWKH$57SURJUDP(JJGRQRUVDVVXPHPRUH
ULVNDQGLQFRQYHQLHQFHWKDQVSHUPGRQRUV,QWKH8QLWHG6WDWHVHJJGRQRUVVHOHFWHGE\$57
SURJUDPV JHQHUDOO\ UHFHLYH PRQHWDU\ FRPSHQVDWLRQ IRU WKHLU SDUWLFLSDWLRQ (JJ GRQDWLRQ LV
PRUHFRPSOH[WKDQVSHUPGRQDWLRQDQGLVGRQHDVSDUWRIDQ,9)SURFHGXUH7KHHJJGRQRU
PXVW XQGHUJR RYDULDQ VWLPXODWLRQ DQG HJJ UHWULHYDO 'XULQJ WKLV WLPH WKH UHFLSLHQW WKH
ZRPDQZKRZLOOUHFHLYHWKHHJJVDIWHUWKH\DUHIHUWLOL]HG UHFHLYHVKRUPRQHPHGLFDWLRQVWR
SUHSDUH KHU XWHUXV IRU LPSODQWDWLRQ $IWHU WKH UHWULHYDO WKH GRQRU V HJJV DUH IHUWLOL]HG E\
VSHUPIURPWKHUHFLSLHQW VSDUWQHUDQGWUDQVIHUUHGWRWKHUHFLSLHQW VXWHUXV7KHUHFLSLHQWZLOO
QRWEHJHQHWLFDOO\UHODWHGWRWKHFKLOGEXWVKHZLOOFDUU\WKHSUHJQDQF\DQGJLYHELUWK

(JJ GRQDWLRQ LV H[SHQVLYH EHFDXVH GRQRU VHOHFWLRQ VFUHHQLQJ DQG WUHDWPHQW DGG
DGGLWLRQDO FRVWV WR WKH ,9) SURFHGXUH +RZHYHU WKH UHODWLYHO\ KLJK OLYH ELUWK UDWH IRU HJJ
GRQDWLRQ DSSUR[LPDWHO\  QDWLRQDOO\ SURYLGHV PDQ\ FRXSOHV ZLWK WKHLU EHVW FKDQFH IRU
VXFFHVV2YHUDOOGRQRUHJJVDUHXVHGLQQHDUO\RIDOO$57F\FOHVLQWKH8QLWHG6WDWHV

,QVRPHFDVHVZKHQERWKWKHPDQDQGZRPDQDUHLQIHUWLOHERWKGRQRUVSHUPDQGHJJV
KDYHEHHQXVHG'RQRUHPEU\RVPD\DOVREHXVHGLQWKHVHFDVHV6RPH,9)SURJUDPVDOORZ
FRXSOHV WR GRQDWH WKHLU XQXVHG IUR]HQ HPEU\RV WR RWKHU LQIHUWLOH FRXSOHV $SSURSULDWH

ϮϵϮ

VFUHHQLQJRIWKHLQGLYLGXDOVZKRVHJHQHWLFHPEU\RVZHUHXVHGWRFUHDWHWKHVHHPEU\RVVKRXOG
DGKHUHWRIHGHUDODQGVWDWHJXLGHOLQHV

7KH XVH RI GRQRU VSHUP HJJV RU HPEU\RV LV D FRPSOLFDWHG LVVXH WKDW KDV OLIHORQJ
LPSOLFDWLRQV 7DONLQJ ZLWK D WUDLQHG FRXQVHORU ZKR XQGHUVWDQGV GRQRU LVVXHV FDQ EH YHU\
KHOSIXOLQWKHGHFLVLRQPDNLQJSURFHVV0DQ\SURJUDPVKDYHDPHQWDOKHDOWKSURIHVVLRQDORQ
VWDIIRUWKHSK\VLFLDQPD\UHFRPPHQGRQH,IDFRXSOHNQRZVWKHGRQRUWKHLUSK\VLFLDQPD\
VXJJHVW WKDW ERWK WKH FRXSOH DQG WKH GRQRU VSHDN ZLWK D FRXQVHORU DQG DQ DWWRUQH\ 6RPH
VWDWHVUHTXLUHDQGPRVW,9)FHQWHUVUHFRPPHQGDQDWWRUQH\WRILOHSDSHUZRUNIRUWKHFRXSOH
ZLWKWKHFRXUWZKHQGRQRUJDPHWHVRUHPEU\RVDUHXVHG

6XUURJDF\*HVWDWLRQDO&DUULHU

$ SUHJQDQF\ PD\ EH FDUULHG E\ WKH HJJ GRQRU WUDGLWLRQDO VXUURJDWH  RU E\ DQRWKHU
ZRPDQZKRKDVQRJHQHWLFUHODWLRQVKLSWRWKHEDE\ JHVWDWLRQDOFDUULHU ,IWKHHPEU\RLVWR
EHFDUULHGE\DVXUURJDWHSUHJQDQF\PD\EHDFKLHYHGWKURXJKLQVHPLQDWLRQDORQHRUWKURXJK
$577KHVXUURJDWHZLOOEHELRORJLFDOO\UHODWHGWRWKHFKLOG,IWKHHPEU\RLVWREHFDUULHGE\
D JHVWDWLRQDO FDUULHU WKH HJJV DUH UHPRYHG IURP WKH LQIHUWLOH ZRPDQ IHUWLOL]HG ZLWK KHU
SDUWQHU V VSHUP DQG WUDQVIHUUHG LQWR WKH JHVWDWLRQDO FDUULHU V XWHUXV 7KH JHVWDWLRQDO FDUULHU
ZLOOQRWEHJHQHWLFDOO\ UHODWHGWRWKHFKLOG$OO SDUWLHVEHQHILWIURP SV\FKRORJLFDODQGOHJDO
FRXQVHOLQJEHIRUHSXUVXLQJVXUURJDF\RUDJHVWDWLRQDOFDUULHU


6WHSVLQWKH,9)(73URFHVV

D'D\'D\RI(JJ5HWULHYDO
:KHQHJJV DUH EURXJKW WR WKH ODERUDWRU\ WKH\ DUHUHPRYHGIURPWKHIROOLFXODUIOXLG
ZDVKHG DQG SODFHG LQ D QXWULHQW VROXWLRQ PHGLXP  LQ DQ LQFXEDWRU 7KH VSHUP LV DOVR
ZDVKHG DQG SURFHVVHG LQ VXFK D ZD\ WKDW PDQ\ RI WKH GHDG DQG DEQRUPDO VSHUP DUH
UHPRYHGDQGWKHPRWLOHVSHUPDUHFRQFHQWUDWHG7KHVSHUPLVLQFXEDWHGXQWLOWKHDIWHUQRRQ
,I WKH VSHUP DSSHDU QRUPDO DQG WKHUH LV QR VXJJHVWLRQ IURP WKH SDWLHQW V KLVWRU\ WKDW
IHUWLOL]DWLRQPLJKWEHDSUREOHP HJXQH[SODLQHGLQIHUWLOLW\ WKHVSHUPDUHSODFHGQHDUWKH
HJJVDQGWKH\DUHLQFXEDWHGRYHUQLJKW
,IWKHUHLVDKLVWRU\RIDPDOHIDFWRUXQH[SODLQHGLQIHUWLOLW\SRRUIHUWLOL]DWLRQLQDSULRU
,9) F\FOH RU D SRRU VDPSOH RQ WKLV SDUWLFXODU GD\ WKH VSHUP DUH SK\VLFDOO\ LQMHFWHG LQWR
HDFKHJJXVLQJ,QWUDF\WRSODVPLF6SHUP,QMHFWLRQ ,&6, 

E'D\)HUWLOL]DWLRQ&KHFN
(DUO\ LQ WKH PRUQLQJ WKH HJJV DUH FKHFNHG IRU VLJQV RI IHUWLOL]DWLRQ $W WKLV WLPH
QRUPDOO\IHUWLOL]HGHJJVZLOOKDYHQXFOHLLQWKHFHQWHURQHIURPWKHHJJDQGRQHIURPWKH
VSHUP DVVKRZQEHORZ 
$Q\ QXPEHU RI QXFOHL JUHDWHU RU OHVVHU WKDQ  LQGLFDWHV DEQRUPDO IHUWLOL]DWLRQ
1RUPDOO\ IHUWLOL]HG HJJV DUH QRZ FRQVLGHUHG WR EH HPEU\RV DQG DUH VHSDUDWHG IURP WKH
XQIHUWLOL]HGDQGDEQRUPDOO\IHUWLOL]HGHJJV
1RUPDOO\DWWKLVWLPHWKHGHFLVLRQLVPDGHDERXWZKHWKHUWKHGD\RIHPEU\RWUDQVIHU
ZLOOEHRQGD\RU7KLVGHFLVLRQLVEDVHGRQWKHQXPEHURIHPEU\RVWKHUHDUHDQGWKHLU

Ϯϵϯ

 TXDOLW\WKHZLIH VDJHDQGDQ\KLVWRU\IURPSULRU,9)F\FOHV,IWKHGHFLVLRQLVQRWFOHDUFXW
DWWKLVWLPHLWZLOOEHPDGHRQWKHPRUQLQJRI'D\
/DWHLQWKH DIWHUQRRQ WKH HPEU\RV DUH FKHFNHGIRUGHYHORSPHQW7KRVHHPEU\RVWKDW
KDYHEHJXQWRJURZDUHVHSDUDWHGIURPWKRVHWKDWKDYHQRWDVWKH\KDYHDEHWWHUFKDQFHRI
FRQWLQXLQJGHYHORSPHQW

F'D\'HYHORSPHQW&KHFN
(DUO\LQWKHPRUQLQJWKHHPEU\RVDUHDJDLQFKHFNHGIRUGHYHORSPHQW$WWKLVSRLQWLQ
WLPHHPEU\RVVKRXOGEHEHWZHHQDQGFHOOV(PEU\RVWKDWKDYHQRWGLYLGHGE\WKLVWLPH
DUHVHSDUDWHGIURPWKHRWKHUVDVWKHLUSURJQRVLVLVSRRU

G'D\$VVLVWHG+DWFKLQJDQGRU7UDQVIHU
$JDLQ HDUO\ LQ WKH PRUQLQJ WKH HPEU\RV DUH FKHFNHG IRU GHYHORSPHQW DQG DUH
SKRWRJUDSKHG

'D\7UDQVIHU
)RUSDWLHQWVKDYLQJDGD\WUDQVIHUWKHEHVWTXDOLW\HPEU\RVDUHVHOHFWHG,GHDOO\WKH
EHVWTXDOLW\HPEU\RVZLOOKDYHFHOOV DVVKRZQEHORZ 
$Q\ZKHUHIURPHPEU\RVZLOOEHWUDQVIHUUHGGHSHQGLQJRQWKHZRPHQ VDJHDQG
WKHTXDOLW\RIWKHHPEU\RV
6RPH SDWLHQWV ZLOO KDYH WKHLU HPEU\RV WUHDWHG ZLWK $VVLVWHG +DWFKLQJ RQ WKLV GD\
3DWLHQWV ZKRDUH  DQG ROGHU ZKR KDYH D KLJK )6+ OHYHO ZKR UHTXLUH ODUJH DPRXQWV RI
PHGLFDWLRQWRJHWWRHJJUHWULHYDOZKRVHHJJVKDYHWKLFNFRDWRISURWHLQVXUURXQGLQJWKHP
RUZKRKDYHQRWEHFRPHSUHJQDQWRQDSULRU,9)F\FOHDUHFDQGLGDWHVIRUWKLVSURFHGXUH,Q
WKLVSURFHGXUHWKHEHVWHPEU\RVDUHFKRVHQDQGDVROXWLRQLVEORZQDJDLQVWWKHSURWHLQFRDW
RIWKHHPEU\RDQGDVPDOOKROHLVFUHDWHG7KLVZLOOKHOSWKHHPEU\RWRFRPHLQFRQWDFWZLWK
WKHOLQLQJRIWKHXWHUXV
(PEU\RVFRQWLQXHLQFXEDWLRQ7KH\ZLOOEHJLQDSURFHVVFDOOHGFRPSDFWLRQ DVVKRZQ
EHORZ 
<RXQJSDWLHQWVPD\RIWHQKDYHFRPSDFWHGHPEU\RVRQGD\
,QDQ\JURXSRIHPEU\RVLWLVWREHH[SHFWHGWKDWVRPHZLOOGHYHORSVORZO\DQGDIHZ
PD\VWRSGHYHORSPHQWDOWRJHWKHU

H'D\
,Q WKH PRUQLQJ HPEU\RV DUH HYDOXDWHG DQG SKRWRJUDSKHG $W WKLV SRLQW LQ WLPH
HPEU\RV WKDW KDYH FRQWLQXHG GHYHORSPHQW VKRXOG EH DW WKH EODVWRF\VW VWDJH DV VKRZQ
EHORZ 
7KH\QRZKDYHFHOOVDQGDQLQQHUFDYLW\WKDWLVILOOHGZLWKIOXLG'HSHQGLQJRQ
WKHZRPDQ VDJHDQGTXDOLW\RIWKHHPEU\RVZLOOEHWUDQVIHUUHG,IWKHUHDUHQRHPEU\RV
WKDWKDYHGHYHORSHGWREODVWRF\VWPRUXODVWDJHPEU\RV WKHVWDJHMXVWEHIRUHEODVWRF\VW ZLOO
EHWUDQVIHUUHG7KUHHWRIRXUPRUXODHPD\EHWUDQVIHUUHG

Ϯϵϰ

I'D\(PEU\R7UDQVIHUDQGRU&U\RSUHVHUYDWLRQ
,IHPEU\RVDUHWREHWUDQVIHUUHGWRDSDWLHQWWKHEHVWHPEU\RVDUHFKRVHQIRUWUDQVIHU
DQGDQ\H[WUDEODVWRF\VWVPD\EHIUR]HQ
<RXQJSDWLHQWVDQGSDWLHQWVZKRKDYHKDG$VVLVWHG +DWFKLQJ PD\ KDYH EODVWRF\VWV
WKDWKDYHEHJXQWKHKDWFKLQJSURFHVV

J'D\&U\RSUHVHUYDWLRQ
$Q\HPEU\RV WKDWKDYH FRQWLQXHGGHYHORSPHQW LQ FXOWXUHDQG KDYH GHYHORSHG WR WKH
EODVWRF\VWVWDJHPD\EHIUR]HQ$OORWKHUHPEU\RVDUHGLVFDUGHG
5LVNVRI$57

7KH PHGLFDO ULVNV RI $57 GHSHQG XSRQ HDFK VSHFLILF VWHS RI WKH SURFHGXUH 7KH
IROORZLQJDUHVRPHRIWKHSULPDU\ULVNVRI$57SURFHGXUHV2YDULDQVWLPXODWLRQFDUULHVZLWK
LW D ULVN RI K\SHUVWLPXODWLRQ ZKHUH WKH RYDULHV EHFRPH VZROOHQ DQG SDLQIXO )OXLG PD\
DFFXPXODWH LQ WKH DEGRPLQDO FDYLW\ DQG FKHVW DQG WKH SDWLHQWPD\ IHHO EORDWHGQDXVHDWHG
DQG H[SHULHQFH YRPLWLQJ RU ODFN RI DSSHWLWH 8S WR  RI SDWLHQWV XQGHUJRLQJ RYDULDQ
VWLPXODWLRQ KDYH D PLOG FDVH RI RYDULDQ K\SHUVWLPXODWLRQ V\QGURPH 2+66  WKDW FDQ EH
PDQDJHG ZLWK RYHUWKHFRXQWHU SDLQNLOOHUV DQG D UHGXFWLRQ LQ DFWLYLW\ ,Q PRGHUDWH 2+66
SDWLHQWV GHYHORS RU DFFXPXODWH IOXLG ZLWKLQ WKH DEGRPLQDO FDYLW\ DQG JDVWURLQWHVWLQDO
V\PSWRPVPD\RFFXU7KHVHZRPHQDUHPRQLWRUHGFORVHO\EXWJHQHUDOO\GRYHU\ZHOOZLWK
VLPSOH RXWSDWLHQW PDQDJHPHQW 7KH FRQGLWLRQ WHQGV WR UHVROYH ZLWKRXW LQWHUYHQWLRQ XQOHVV
SUHJQDQF\ RFFXUV LQ ZKLFK DVH UHFRYHU\ PD\ EH GHOD\HG IRU VHYHUDO ZHHNV 8S WR  RI
SDWLHQWVGHYHORSVHYHUH2+66FKDUDFWHUL]HGE\H[FHVVLYHZHLJKWJDLQIOXLGDFFXPXODWLRQLQ
WKHDEGRPHQDQGFKHVWHOHFWURO\WHDEQRUPDOLWLHVRYHUFRQFHQWUDWLRQRIWKHEORRGDQGUDUHO\
WKH GHYHORSPHQW RI EORRG FORWV NLGQH\ IDLOXUH RU GHDWK ,W PD\ EH PHGLFDOO\ QHFHVVDU\ WR
GUDLQ IOXLG IURP WKH DEGRPHQ ZLWK D QHHGOH LI EUHDWKLQJ EHFRPHV GLIILFXOW 3DWLHQWV ZLWK
VHYHUH2+66UHTXLUHKRVSLWDOL]DWLRQXQWLOWKHV\PSWRPVLPSURYH,ISUHJQDQF\RFFXUV2+66
FDQZRUVHQ 2FFDVLRQDOO\ WHUPLQDWLRQ RI SUHJQDQF\ PXVW EH FRQVLGHUHG LQ WKH PRVW VHYHUH
FDVHV $OWKRXJK LQLWLDO UHSRUWV VXJJHVWHG WKDW ZRPHQ ZKR XVH IHUWLOLW\ GUXJV KDYH DQ
LQFUHDVHGULVNIRURYDULDQFDQFHUQXPHURXVUHFHQWVWXGLHVVXSSRUWWKHFRQFOXVLRQWKDWIHUWLOLW\
GUXJVDUHQRWOLQNHGWRRYDULDQFDQFHU1HYHUWKHOHVVWKHUHLVVWLOOXQFHUWDLQW\ZKHWKHUDULVN
H[LVWVDQGUHVHDUFKFRQWLQXHVWRDGGUHVVWKLVTXHVWLRQ

$QDQQXDO J\QHFRORJLF YLVLW LV UHFRPPHQGHG IRU DOO ZRPHQ ZLWK H[DPLQDWLRQ RIWKH
RYDULHV UHJDUGOHVV RI SULRU XVHRI RYXODWLRQPHGLFDWLRQV 7KHUH DUH ULVNV UHODWHG WR WKH HJJ
UHWULHYDO SURFHGXUH /DSDURVFRS\ FDUULHV ZLWK LW WKH ULVNV RI DQ\ VXUJHU\ WKDW UHTXLUHV
DQHVWKHVLD 5HPRYLQJ HJJV WKURXJK DQ DVSLUDWLQJ QHHGOH HQWDLOV D VOLJKW ULVN RI EOHHGLQJ
LQIHFWLRQ DQG GDPDJH WR WKH ERZHO EODGGHU RU D EORRG YHVVHO 7KLV LV WUXH ZKHWKHU WKH
SK\VLFLDQXVHVODSDURVFRS\RUXOWUDVRXQGWRJXLGHWKHQHHGOH/HVVWKDQRQHSDWLHQWLQ
ZLOO UHTXLUH PDMRU VXUJHU\ WR UHSDLU GDPDJH IURP FRPSOLFDWLRQV RI WKH HJJ UHWULHYDO
SURFHGXUH,QUDUHFDVHVLQIHFWLRQPD\RFFXUIURPWKHUHWULHYDORUHPEU\RWUDQVIHU

7KH FKDQFH RI PXOWLSOH SUHJQDQFLHV LV LQFUHDVHG LQ DOO DVVLVWHG UHSURGXFWLYH
WHFKQRORJLHV ZKHQ PRUH WKDQ RQH HPEU\R LV WUDQVIHUUHG $OWKRXJK VRPH ZRXOG FRQVLGHU
WZLQVDKDSS\UHVXOWWKHUHDUHPDQ\SUREOHPVDVVRFLDWHGZLWKPXOWLSOHELUWKVDQGSUREOHPV
EHFRPH SURJUHVVLYHO\ PRUH VHYHUH DQG FRPPRQ ZLWK WULSOHWV DQG HDFK DGGLWLRQDO IHWXV
WKHUHDIWHU:RPHQFDUU\LQJDPXOWLSOHSUHJQDQF\PD\QHHGWRVSHQGZHHNVRUHYHQPRQWKV
LQ EHG RU LQ WKH KRVSLWDO LQ DQ DWWHPSW WR GHOD\ SUHPDWXUH GHOLYHU\ 7KH ULVN RI SUHPDWXUH

Ϯϵϱ

GHOLYHU\ LQ PXOWLSOH SUHJQDQFLHV LV KLJK DQG EDELHV PD\ EH ERUQ WRR HDUO\ WR VXUYLYH
3UHPDWXUH EDELHV UHTXLUH SURORQJHG DQG LQWHQVLYH FDUH DQG ULVN OLIHORQJ KDQGLFDSV GXH WR
SUHPDWXUHELUWK

6RPHFRXSOHVPD\FRQVLGHUPXOWLIHWDOSUHJQDQF\UHGXFWLRQWRGHFUHDVHWKHULVNVGXHWR
PXOWLSOH SUHJQDQF\ EXW WKLV LV OLNHO\ WR EH D GLIILFXOW GHFLVLRQ 'DWD DOVR VXJJHVW WKDW ,9)
FRQFHSWLRQVHYHQVLQJOHWRQVKDYHDVOLJKWO\LQFUHDVHGULVNRISUHPDWXUHGHOLYHU\RUORZELUWK
ZHLJKW )LUVW WULPHVWHU EOHHGLQJ PD\ VLJQDO D SRVVLEOH PLVFDUULDJH RU HFWRSLF SUHJQDQF\ ,I
EOHHGLQJRUSDLQ EHIRUHZHHNV RFFXUV DPHGLFDOHYDOXDWLRQLVQHHGHGWRGHWHUPLQHWKH
FDXVH6RPHHYLGHQFHVXJJHVWVWKDWHDUO\EOHHGLQJLVPRUHFRPPRQLQZRPHQZKRXQGHUJR
,9) DQG *,)7 DQG LV QRW DVVRFLDWHG ZLWK WKH VDPH SRRU SURJQRVLV DV LW LV LQ ZRPHQ ZKR
FRQFHLYHVSRQWDQHRXVO\

0LVFDUULDJHPD\RFFXU DIWHU$57 HYHQDIWHU XOWUDVRXQG LGHQWLILHVDSUHJQDQF\LQWKH
XWHUXV0LVFDUULDJHRFFXUVDIWHUXOWUDVRXQGLQQHDUO\RIZRPHQ\RXQJHUWKDQDJHLQ
 DW DJH  DQG LQ  DW DJH  IROORZLQJ $57 SURFHGXUHV ,Q DGGLWLRQ WKHUH LV
DSSUR[LPDWHO\DFKDQFHRIHFWRSLFSUHJQDQF\ZLWK$57,WLVQRWFOHDUZKHWKHUWKHULVNRI
ELUWKGHIHFWVLVLQFUHDVHGZLWK,9)0RVWVWXGLHVGRQRWVKRZDQLQFUHDVHGULVNEXWVHYHUDO
VWXGLHVGR5HVHDUFKLVRQJRLQJWRGHWHUPLQHWKHPDJQLWXGHLIDQ\RIWKLVULVN)XUWKHUPRUH
ZKHQ,&6,LVXVHGLQFDVHVRIVHYHUHPDOHIDFWRULQIHUWLOLW\DJHQHWLFFDXVHRIPDOHLQIHUWLOLW\
PD\EHSDVVHGRQWRWKHRIIVSULQJ

$VVLVWHG UHSURGXFWLYH WHFKQRORJLHV LQYROYH D VLJQLILFDQW SK\VLFDO ILQDQFLDO DQG
HPRWLRQDOFRPPLWPHQWRQWKHSDUWRIWKHFRXSOH3V\FKRORJLFDOVWUHVVLVFRPPRQDQGVRPH
FRXSOHVGHVFULEHWKHH[SHULHQFHDVDQHPRWLRQDOUROOHUFRDVWHU 7KH WUHDWPHQWV DUH LQYROYHG
DQG FRVWO\ 3DWLHQWV KDYH KLJK H[SHFWDWLRQV \HW IDLOXUH LV FRPPRQ LQ DQ\ JLYHQ F\FOH
&RXSOHVPD\IHHOIUXVWUDWHGDQJU\ LVRODWHGDQGUHVHQWIXO$WWLPHV IUXVWUDWLRQFDQ OHDG WR
GHSUHVVLRQ DQG IHHOLQJV RI ORZ VHOIHVWHHP HVSHFLDOO\ LQ WKH LPPHGLDWH SHULRG IROORZLQJ D
IDLOHG $57 DWWHPSW 7KH VXSSRUW RI IULHQGV DQG IDPLO\ PHPEHUV LV YHU\ LPSRUWDQW DW WKLV
WLPH&RXSOHVDUHHQFRXUDJHGWRFRQVLGHUSV\FKRORJLFDOFRXQVHOLQJDVDQDGGLWLRQDOPHDQVRI
VXSSRUWDQGVWUHVVPDQDJHPHQW0DQ\SURJUDPVKDYHDPHQWDOKHDOWKSURIHVVLRQDORQVWDIIWR
KHOS FRXSOHV GHDO ZLWK WKH JULHI WHQVLRQ RU DQ[LHWLHV DVVRFLDWHG ZLWK LQIHUWLOLW\ DQG LWV
WUHDWPHQW

3UHSDUDWLRQIRU$57

3UHOLPLQDU\ SUHSDUDWLRQ IRU DQ $57 SURFHGXUH PD\ EH DV LPSRUWDQW DV WKH SURFHGXUH
LWVHOI 7HVWLQJ IRU RYDULDQ UHVHUYH PD\ EH UHFRPPHQGHG WR SUHGLFW KRZ WKH RYDULHV ZLOO
UHVSRQG WR IHUWLOLW\ PHGLFDWLRQ 7KH FKDQFH RI VXFFHVV PD\ EH SRRU IRU H[DPSOH LI WHVWV
GHPRQVWUDWH GLPLQLVKHG RYDULDQ UHVHUYH RU IHUWLOLW\ SRWHQWLDO 2YDULDQ UHVHUYH PD\ EH
GHWHUPLQHGE\PHDVXULQJ)6+DQGHVWUDGLROOHYHOVRQWKHVHFRQGRUWKLUGGD\RIDPHQVWUXDO
F\FOHSHUIRUPLQJDFORPLSKHQHFKDOOHQJHWHVWRUFRXQWLQJWKHQXPEHURIEHJLQQLQJIROOLFOHV
LQWKHRYDU\ DQWUDOIROOLFOHFRXQW $QHOHYDWHG)6+DQGRUHVWUDGLROOHYHOLVDVVRFLDWHGZLWK
UHGXFHG SUHJQDQF\ UDWHV HVSHFLDOO\ LQ ZRPHQ RYHU WKH DJH RI  \HDUV 8WHULQH FDYLW\
DEQRUPDOLWLHVVXFKDVILEURLGVSRO\SVRUDVHSWXPPD\QHHGWREHFRUUHFWHGEHIRUH,9)RU
*,)7 $ K\GURVDOSLQ[ D IOXLGILOOHG EORFNHG IDOORSLDQ WXEH UHGXFHV ,9) VXFFHVV 6RPH
SK\VLFLDQVDGYLVHFOLSSLQJRUUHPRYLQJWKHDIIHFWHGWXEHEHIRUH,9))RUPRUHLQIRUPDWLRQ
VHHWKH$650SDWLHQWIDFWVKHHWWLWOHG+\GURVDOSLQ[


Ϯϵϲ

 6HPHQLVWHVWHGEHIRUH$57,IVHPHQDEQRUPDOLWLHVDUHLGHQWLILHGFRQVXOWDWLRQZLWKD
VSHFLDOLVWLQPDOHLQIHUWLOLW\VKRXOGGHWHUPLQHLIWKHUHDUHFRUUHFWDEOHSUREOHPVRUXQGHUO\LQJ
KHDOWKFRQFHUQV)RUH[DPSOHJHQHWLFDEQRUPDOLWLHVLQWKH<FKURPRVRPHKDYHEHHQOLQNHG
WRVRPHFDVHVRIPDOHLQIHUWLOLW\DQGPHQERUQZLWKRXWDYDVGHIHUHQVDWXEHWKDWWUDQVSRUWV
VSHUP IURP WKH WHVWLFOH DUH RIWHQ FDUULHUV RI D JHQH WKDW FDXVHV F\VWLF ILEURVLV ,Q WKHVH
FLUFXPVWDQFHVJHQHWLFWHVWLQJPD\EHDGYLVDEOH

0DMRUDGYDQFHVKDYHEHHQPDGHLQWKHWUHDWPHQWRIPDOHLQIHUWLOLW\DQG,9)PD\KHOS
VRPHPHQZKRZHUHSUHYLRXVO\FRQVLGHUHGVWHULOH'HWDLOHGFRQVXOWDWLRQZLWKDVSHFLDOLVWLQ
PDOH LQIHUWLOLW\ LV HVVHQWLDO :KHQ VSHUP FDQQRW EH FROOHFWHG E\ PDVWXUEDWLRQ
HOHFWURHMDFXODWLRQ ((-  PLFURHSLGLG\PDO VSHUP DVSLUDWLRQ 0(6$  SHUFXWDQHRXV
HSLGLG\PDOVSHUPDVSLUDWLRQ 3(6$ RUWHVWLFXODUVSHUPH[WUDFWLRQ 7(6( PD\EHHIIHFWLYH
PHWKRGVWRFROOHFWVSHUPIRU,9)((-PD\EHDQHIIHFWLYHZD\WRFROOHFWVSHUPIURPPHQ
ZLWKVSLQDOFRUGLQMXULHV'XULQJ((-HOHFWULFDOLPSXOVHVIURPDSUREHSODFHGLQWKHUHFWXP
QHDU WKH SURVWDWH RIWHQ DFFRPSOLVK HMDFXODWLRQ 0(6$ FDQ EH SHUIRUPHG WR UHFRYHU VSHUP
DIWHU YDVHFWRP\ RU IDLOHG YDVHFWRP\ UHYHUVDO DQG LQ VRPH PHQ ZLWK DEVHQFH RI WKH YDV
GHIHUHQV 7(6( LQYROYHV WHVWLFXODU ELRSV\ DQG UHFRYHU\ RI VSHUP GLUHFWO\ IURP WHVWLFXODU
WLVVXH DQG PD\ EH SHUIRUPHG LQ DQ RIILFH VHWWLQJ ZLWK ORFDO DQHVWKHVLD 6SHUP REWDLQHG E\
WKHVHPHWKRGVPD\EHIUR]HQVWRUHGDQGWKDZHGODWHUIRU$57

/LIHVW\OHLVVXHVVKRXOGEHDGGUHVVHGEHIRUH$576PRNLQJIRUH[DPSOHPD\ORZHUD
ZRPDQ VFKDQFHRIVXFFHVVE\DVPXFKDV$OOPHGLFDWLRQVLQFOXGLQJRYHUWKHFRXQWHU
VXSSOHPHQWV VKRXOG EH UHYLHZHG EHFDXVH VRPH PD\ KDYH GHWULPHQWDO HIIHFWV $OFRKRO DQG
UHFUHDWLRQDOGUXJVPD\EHKDUPIXODQGH[FHVVLYHFDIIHLQH FRQVXPSWLRQ VKRXOG EH DYRLGHG
%HFDXVH IROLF DFLG WDNHQ EHIRUH SUHJQDQF\ UHGXFHV WKH ULVN RI QHXUDO WXEH GHIHFWV VXFK DV
VSLQDELILGDZRPHQVKRXOGWDNHSUHQDWDOYLWDPLQVFRQWDLQLQJDWOHDVWPLFURJUDPVRIIROLF
DFLGEHIRUHEHJLQQLQJDQ$57F\FOH$FRPSOHWHH[DPDQG3DSVPHDUPD\LGHQWLI\SUREOHPV
WKDWVKRXOGEHWUHDWHGEHIRUHSUHJQDQF\

$GHWDLOHGH[DPLQDWLRQRI$57LQVXUDQFHEHQHILWVLVKHOSIXO(YHQLI$57LVH[FOXGHG
IURP D SROLF\ FRYHUDJH PD\ EH DYDLODEOH IRU VRPH DVSHFWV RI WKHVH SURFHGXUHV &RXSOHV
VKRXOG FRQVXOW WKHLU FRPSDQLHV  EHQHILWV GLUHFWRU LQ DGYDQFH EHFDXVH RSWLRQV VXFK DV D
PHGLFDOVDYLQJVDFFRXQWPD\EHDYDLODEOH,WLVDOVRLPSRUWDQWWRGHWHUPLQHWKHFRVWVIRUWKH
$57 WUHDWPHQW F\FOH .HHS LQ PLQG WKDW IHHV IRU LQLWLDO FRQVXOWDWLRQ VFUHHQLQJ WHVWV
PHGLFDWLRQVDQGVSHFLDOSURFHGXUHVVXFKDV,&6,DQGFU\RSUHVHUYDWLRQPD\QRWEHLQFOXGHG
LQ WKH HVWLPDWH 2WKHU H[SHQVHV WR FRQVLGHU LQFOXGH WUDYHO ORGJLQJ DQG WLPH PLVVHG IURP
ZRUN

6HOHFWLQJDQ$573URJUDP

:KHQ VHOHFWLQJ DQ $57 SURJUDP LQIRUPDWLRQ LV FUXFLDO ,PSRUWDQW SRLQWV IRU
FRQVLGHUDWLRQLQFOXGHWKHTXDOLILFDWLRQVDQGH[SHULHQFHRISHUVRQQHOW\SHVRISDWLHQWVEHLQJ
WUHDWHGVXSSRUWVHUYLFHVDYDLODEOHFRVWFRQYHQLHQFHOLYHELUWKUDWHVSHU$57F\FOHVWDUWHG
DQGPXOWLSOHSUHJQDQF\UDWHV2OGHUSURJUDPVKDYHHVWDEOLVKHGOLYHELUWKUDWHVEDVHGRQ\HDUV
RI H[SHULHQFH 6PDOO DQG QHZ SURJUDPV PD\ VWLOO EH GHWHUPLQLQJ WKHLU OLYH ELUWK UDWHV
DOWKRXJKWKHLUSHUVRQQHOPD\EHHTXDOO\ZHOOTXDOLILHG

(YHU\ FRXSOH ZDQWV WR XVH WKH PRVW VXFFHVVIXO $57 SURJUDP EXW PDQ\ IDFWRUV
FRQWULEXWHWRWKHRYHUDOOVXFFHVVRIDSURJUDP)RUH[DPSOHVRPHFOLQLFVPD\EHZLOOLQJWR
DFFHSW SDWLHQWV ZLWK D ORZ FKDQFH RI VXFFHVV $ FOLQLF PD\ VSHFLDOL]H LQ FHUWDLQ W\SHV RI

Ϯϵϳ

LQIHUWLOLW\ WUHDWPHQW &RVWV PD\ YDU\ EHWZHHQ SURJUDPV $ FRXSOH PD\ SUHIHU D SURJUDP
EDVHG RQ LQWHUSHUVRQDO LQWHUDFWLRQV ZLWK WKH $57 WHDP RU PD\ IHHO PRUH FRQILGHQW LQ WKH
UHFRPPHQGHGWUHDWPHQWSODQ&RQVHTXHQWO\LWLVQRWDSSURSULDWHWRFRPSDUHSURJUDPVEDVHG
RQO\RQWKHSXEOLVKHGSUHJQDQF\UDWHV
&UHGLELOLW\LVLPSRUWDQWWRR'RHVWKHSURJUDPDGKHUHWRWKHJXLGHOLQHVVHWIRUWKE\WKH
$PHULFDQ6RFLHW\IRU5HSURGXFWLYH0HGLFLQH $650 ",VWKHSURJUDPDPHPEHURI6$57D
VRFLHW\ DIILOLDWHG ZLWK WKH $650" ,V WKH ,9) ODE DFFUHGLWHG E\ WKH &ROOHJH RI $PHULFDQ
3DWKRORJLVWVRUE\WKH-RLQW&RPPLVVLRQ"7KHVHRUJDQL]DWLRQVUHTXLUH$57SURJUDPVWRKDYH
SHUVRQQHORQWKHLUVWDIIVWKDWKDYHEHHQWUDLQHGLQUHSURGXFWLYHHQGRFULQRORJ\ODSDURVFRSLF
VXUJHU\ VRQRJUDSK\ KRUPRQH PHDVXUHPHQW WLVVXH FXOWXUH WHFKQLTXH DQG VSHUPHJJ
LQWHUDFWLRQ$UHWKHSK\VLFLDQVERDUGFHUWLILHGLQUHSURGXFWLYHHQGRFULQRORJ\DQGLQIHUWLOLW\"
'RHV WKH SURJUDP UHSRUW LWV UHVXOWV WR 6$57&'&" 7KH FRPSLOHG UHVXOWV DUH SXEOLVKHG LQ
)HUWLOLW\DQG6WHULOLW\WKH$650MRXUQDODQGUHVXOWVDUHDYDLODEOHRQWKH6$57:HEVLWHDW
ZZZVDUWRUJ DQG WKH &'& V :HE VLWH DW ZZZFGFJRYDUW 7KH DERYH FRQVLGHUDWLRQV DQG
DQVZHUVWRWKHIROORZLQJTXHVWLRQVZKLFKPD\EHDVNHGRIHDFKSURJUDPZLOOKHOS\RXPDNH
DQLQIRUPHGGHFLVLRQZKHQFKRRVLQJDQ$57SURJUDP

&RVWDQG&RQYHQLHQFH
x :KDW SUHF\FOH VFUHHQLQJ WHVWV DUH UHTXLUHG KRZ PXFK GR WKH\ FRVW DQG ZLOO P\
LQVXUDQFHSURYLGHFRYHUDJHIRUWKHVHWHVWV"
x +RZPXFKGRHVWKH$57SURFHGXUHFRVWLQFOXGLQJGUXJVSHUWUHDWPHQWF\FOH"
x 'R,SD\LQDGYDQFH"+RZPXFK":KDWDUHWKHPHWKRGVRISD\PHQW"
x ,IDSSOLFDEOHZLOO\RXVXEPLWDQ\ELOOVWRP\LQVXUDQFHFRPSDQ\"
x +RZPXFK GR ,SD\ LI P\ WUHDWPHQW F\FOH LV FDQFHOHG EHIRUHHJJ UHFRYHU\" %HIRUH
HPEU\RWUDQVIHU"
x :KDWDUHWKHFRVWVIRUHPEU\RIUHH]LQJVWRUDJHDQGWUDQVIHU"
x +RZPXFKZRUNZLOO,PLVV"+RZPXFKZLOOP\SDUWQHUPLVV"
x 'R\RXKHOSDUUDQJH ORZFRVW ORGJLQJLIQHHGHG"

'HWDLOVDERXWWKH3URJUDP
x ,VWKHSURJUDPDPHPEHURIWKH6RFLHW\IRU$VVLVWHG5HSURGXFWLYH7HFKQRORJ\"
x 'RHVWKHSURJUDPPHHWDQGIROORZ$6506$57JXLGHOLQHV"
x 'RHVWKHSURJUDPUHSRUWLWVUHVXOWVWR6$57&'&"
x +RZPDQ\SK\VLFLDQVZLOOEHLQYROYHGLQP\FDUH"
x $UHRQHRUPRUHSK\VLFLDQVERDUGFHUWLILHGLQUHSURGXFWLYHHQGRFULQRORJ\"
x 7RZKDWGHJUHHFDQP\RZQSK\VLFLDQSDUWLFLSDWHLQP\FDUH"
x :KDWW\SHVRIFRXQVHOLQJDQGVXSSRUWVHUYLFHVDUHDYDLODEOH"
x :KRPGR,FDOOGD\RUQLJKWLI,KDYHDSUREOHP"
x 'R\RXIUHH]HHPEU\RV FU\RSUHVHUYDWLRQ "
x ,VGRQRUVSHUPDYDLODEOHLQ\RXUSURJUDP"'RQRUHJJV"'RQRUHPEU\RV"
x 'R\RXKDYHDQDJHRUEDVDO)6+FXWRII"
x 'R\RXSHUIRUP,&6,",IVRZKHQ":KDWLVWKHFRVW"
x 'R\RXSHUIRUPDVVLVWHGKDWFKLQJ",IVRZKHQ":KDWLVWKHFRVW"
x +RZPDQ\HJJVHPEU\RVZRXOGEHWUDQVIHUUHGLQP\FDVH"
x :KRPDNHVWKHILQDOGHFLVLRQWRFDQFHOWKHF\FOHLIP\UHVSRQVHWRVWLPXODWLRQLVVXE
RSWLPDO"

6XFFHVVRIWKH3URJUDP

Ϯϵϴ

 6$57LVDYHU\JRRGVRXUFHRILQIRUPDWLRQIURPZKLFKWRWRREWDLQ$57RXWFRPHVIRU
HDFK PHPEHU SURJUDP LQ WKH 8QLWHG 6WDWHV 7KLV LQIRUPDWLRQ PD\ EH D \HDU ROG VR LW LV
LPSRUWDQWWRILQGRXWLIWKHUHKDYHEHHQDQ\VLJQLILFDQWFKDQJHVLQWKHSURJUDPEHFDXVHWKH
PRVWUHFHQWUHSRUWLQFOXGLQJ


x 3HUVRQQHOFKDQJHV
x &KDQJHV LQ WKH DSSURDFK WR RYDULDQ VWLPXODWLRQ HJJ UHWULHYDO HPEU\R FXOWXUH RU
HPEU\RWUDQVIHU
x &KDQJHLQWKHQXPEHURIF\FOHV
x &KDQJH LQ WKH PLVFDUULDJH UDWH OLYH ELUWK UDWH SHU F\FOH VWDUWHG RU WKH PXOWLSOH
SUHJQDQF\UDWH
,I D SURJUDP FLWHV D OLYH ELUWK UDWH IRU HDFK SURFHGXUH EH VXUH WKDW WKH SURJUDP
UHSUHVHQWDWLYH RXQWV WZLQV DV RQH VXFFHVVIXO SUHJQDQF\ QRW WZR :KHQ GLVFXVVLQJ UHFHQW
$57 SURJUDP RXWFRPHV NHHS LQ PLQG WKDW WKH OLYH ELUWK UDWH PD\ YDU\ GHSHQGLQJ RQ WKH
GHQRPLQDWRUXVHGLHSHUF\FOHVWDUWHGSHUUHWULHYDORUSHUHPEU\RWUDQVIHU)RUH[DPSOH
OLYHELUWKUDWHVSHUHJJUHWULHYDOGRQRWFRQVLGHUFDQFHOOHGF\FOHVDQGUDWHVEDVHGSHUHPEU\R
WUDQVIHUGRQRWLQFOXGHFDQFHOOHGF\FOHVRUIHUWLOL]DWLRQIDLOXUHV7KHUHIRUHOLYHELUWKUDWHVSHU
F\FOHDUHKLJKHUSHUHJJUHWULHYDODQGDUHKLJKHVWSHUHPEU\RWUDQVIHU

:KHQWRHQGWUHDWPHQW

6WXGLHV LQGLFDWH WKDW WKH FKDQFH IRU SUHJQDQF\ LQ FRQVHFXWLYH ,9) F\FOHV UHPDLQV
VLPLODU LQ XS WR IRXU F\FOHV +RZHYHU PDQ\ RWKHU IDFWRUV VKRXOG EH FRQVLGHUHG ZKHQ
GHWHUPLQLQJ WKH DSSURSULDWH HQGSRLQW LQ WKHUDS\ LQFOXGLQJ ILQDQFLDO DQG SV\FKRORJLFDO
UHVHUYHV 0HPEHUV RI WKH ,9) WHDP FDQ KHOS FRXSOHV GHFLGH ZKHQ WR VWRS WUHDWPHQW DQG
GLVFXVV RWKHU RSWLRQV VXFK DV HJJ DQGRU VSHUP GRQDWLRQ RU DGRSWLRQ LI DSSURSULDWH 7KH
SK\VLFLDQ VXSSRUW JURXSV DQG RWKHU FRXSOHV XQGHUJRLQJ LQIHUWLOLW\ WUHDWPHQW FDQ SURYLGH
YDOXDEOHVXSSRUWDQGJXLGDQFH

&RQFOXVLRQ
,W LV D SULYLOHJH IRU DQ\ VFLHQWLVW RU FOLQLFLDQ WR KDYH DFFHVV WR WKH HDUOLHVW VWDJHV RI KXPDQ
GHYHORSPHQWWKURXJKFXOWXULQJJDPHWHVDQGHPEU\RVLQYLWUR$QGDVVXFKLWUHTXLUHVDKLJKGHJUHH
RI HWKLFDO UHVSRQVLELOLW\ WR SURYLGH DV VDIH DQG RSWLPDO DQ HQYLURQPHQW DV SRVVLEOH IRU WKHVH
PLFURVFRSLFFKDQJHV:KLOHPXFKKDVEHHQGRQHWRPD[LPL]H,9)SUHJQDQF\UDWHVRYHUWKHODVWWZR
GHFDGHVLWQHYHUWKHOHVVUHPDLQVWRLPSURYHLQGLYLGXDOHPEU\RVHOHFWLRQWRWKHSRLQWZKHUHZHFDQ
URXWLQHO\WUDQVIHURQO\RQHHPEU\RDWDWLPHZKLOHEHLQJDEOHWRVXFFHVVIXOO\DQGFRQVLVWHQWO\IUHH]H
DOOVXUSOXVHPEU\RVRIVXIILFLHQWTXDOLW\IRUODWHUXVHLQDWWHPSWLQJSUHJQDQF\


,QYLWURIHUWLOL]DWLRQLQ,QGLD

,Q YLWUR IHUWLOL]DWLRQ ,9)  DQG HPEU\R WUDQVIHU ZHUH VXFFHVVIXOO\ LQWURGXFHG WR WUHDW
KXPDQLQIHUWLOLW\LQDQGWKHZRUOG¶VILUVWWHVWWXEHEDE\/RXLVH%URZQZDVERUQLQWKH
8.RQ-XO\RIWKDW\HDU([DFWO\GD\VODWHU6XEKDVK0XNHUMHHDQQRXQFHGWKHELUWKRI
WKH ZRUOG¶V VHFRQG WHVWWXEH EDE\ .DQXSUL\D DOLDV 'XUJD RQ  2FWREHU  LQ &DOFXWWD
%RWKWKHVHDQQRXQFHPHQWVZHUHUHFHLYHGZLWKVNHSWLFLVPDQGWKHVFLHQWLVWVUHVSRQVLEOHIRU
WKHVHELUWKVZHUHVHYHUHO\FULWLFL]HG1HYHUWKHOHVVWKH%ULWLVKWHDPFDUULHGRQZLWKWKHLUZRUN

Ϯϵϵ

DQG SURGXFHG VHYHUDO PRUH WHVWWXEH EDELHV ,Q PDUNHG FRQWUDVW WKH *RYHUQPHQW RI :HVW
%HQJDO SURVFULEHG 0XNHUMHH IURP FDUU\LQJ RXW IXUWKHU ZRUN LQ WKLV DUHD DQG KH ZDV
WUDQVIHUUHGWRDQH\HKRVSLWDOWKDWGLGQRWKDYHDQ\IDFLOLWLHVWRHQDEOHKLPSXUVXHKLVZRUN

0XNHUMHH FRXOG QRW SXEOLVK DOO WKH GHWDLOV RI KLV ZRUN +H ZDV DVNHG E\ WKH
*RYHUQPHQW WR VXEPLW GHWDLOV RI KLV ZRUN ZKLFK KH GLG +H DOVR VWDWHG WKDW KH ZLVKHG WR
FDUU\RXWIXUWKHUZRUNVRWKDWKHFRXOGYDOLGDWHDQGVWDQGDUGL]HWKHYDULRXVSURFHGXUHVKHKDG
XVHG LQ KLV ILUVW DQG RQO\ VXFFHVV +LV EHLQJ SURKLELWHG WR FDUU\ RXW IXUWKHU ZRUN E\ WKH
*RYHUQPHQWRI:HVW%HQJDODQGKLVXQWLPHO\GHDWKOHIWELJODFXQDHLQRXUXQGHUVWDQGLQJWKH
UDWLRQDOH EHKLQG WKH WHFKQLTXHV KH XVHG +RZHYHU LQ WKH UHSRUW KH VXEPLWWHG WR WKH
*RYHUQPHQW RI :HVW %HQJDO ZKLFK ZDV VLJQHG E\ DOO WKH WKUHH LQYHVWLJDWRUV WKDW ZHUH
LQYROYHG LQ FDUU\LQJ RXW WKLV SURFHGXUH VRPH GHWDLOV ZHUH JLYHQ 7KHVH GHWDLOV FOHDUO\
LQGLFDWHWKDW0XNHUMHH¶VWHFKQLTXHVZHUHGLIIHUHQWIURPWKRVHXVHGE\WKH%ULWLVKWHDP,9)
LQ,QGLDZRXOGKDYHFRQWLQXHGWRODQJXLVKEXWIRUWKHVXSSRUWIURPWKH,&05WRVXSSRUW,9)
(7WKDWOHGWRWKHELUWKRI+DUVKDLQ0XPEDLLQ6HYHUDORWKHUFOLQLFVVRRQIROORZHGVXLW
DQGWRGD\WKHUHDUHUHSRUWHGO\RYHUFOLQLFVFODLPLQJWRRIIHU,9)DOORYHU,QGLD

$PLOOLRQWHVWWXEHEDELHVKDYHUHSRUWHGO\EHHQERUQDOORYHUWKHZRUOG,9)KDVWXUQHG
RXWWREHDPDMRUVFLHQWLILFDFKLHYHPHQWRIPDQNLQGGXULQJWKHODVWFHQWXU\,WKDVQRWRQO\
RSHQHG RXW QRYHO ZD\V RI WUHDWLQJ LQIHUWLOLW\ LQYROYLQJ WKLUG DQG VRPHWLPHV IRXUWK SDUW\
SDUHQWLQJDFKLOGLQDWDQGHPPDQQHUEXWDOVRDGYDQFHGRXUXQGHUVWDQGLQJRIEDVLFELRORJ\
DQGSDWKRORJ\RIKXPDQUHSURGXFWLRQ:LWKQHZGHYHORSPHQWVRFFXUULQJLQWKHSRWHQWLDOXVH
RIHPEU\RQLFVWHPFHOOVLQWKHGHYHORSPHQWRIELRWKHUDSHXWLFV,9)LVWKHRQO\ZD\WRREWDLQ
SOXULSRWHQWLDOHPEU\RQLFVWHPFHOOV

,QYLHZRIWKHVHYDVWGHYHORSPHQWVLQWKHILHOGRI,9)LWLVRQO\SURSHUWKDWWKHSLRQHHUV
LQWKHILHOGDUHUHPHPEHUHGDQGKRQRXUHG%ULWDLQFHOHEUDWHGWKHELUWKRI/RXLVH%URZQZLWK
PXFKIDQIDUHRQ-XO\WKLV\HDU7KH,QGLDQ&RXQFLORI0HGLFDO5HVHDUFKLQFROODERUDWLRQ
ZLWK WKH ,QWHU $FDGHP\ %LRPHGLFDO 6FLHQFH )RUXP DQG +RSH ,QIHUWLOLW\ &OLQLF
FRPPHPRUDWHGWKHVLOYHUMXELOHHRI,9)LQ,QGLDDWDVLPSOHIXQFWLRQKHOGLQWKHSUHPLVHVRI
WKH,QGLDQ$FDGHP\RI6FLHQFHV%DQJDORUH2QEHKDOIRIWKH'LUHFWRU*HQHUDORIWKH,QGLDQ
&RXQFLORI0HGLFDO5HVHDUFK9DVDQWKD0XWKXVZDP\IHOLFLWDWHG.DQXSUL\D6XQLW0XNHUMHH
WKH RQO\ VXUYLYLQJ PHPEHU RI 0XNHUMHH¶V WHDP DQG & 3 3XUL 1DWLRQDO ,QVWLWXWH IRU
5HVHDUFK LQ 5HSURGXFWLYH +HDOWK 0XPEDL IRU KLV SHUVRQDO FRQWULEXWLRQ WR WKH HQGRFULQH
HYDOXDWLRQ DQG PRQLWRULQJ RI FRQWUROOHG RYDULDQ K\SHU VWLPXODWLRQ RI ZRPHQ UHFUXLWHG IRU
,9)ZKLFKZDVWKHFRUQHUVWRQHIRUWKHVXFFHVVIXOSUHJQDQF\WRRFFXUDIWHU,9)DQGHPEU\R
WUDQVIHU 7KLV ZDV IROORZHG E\ D V\PSRVLXP RQ 6SLQRIIV IURP 0HGLFDOO\ $VVLVWHG
5HSURGXFWLYH 7HFKQLTXHV 7KLV PHHWLQJ ZDV DLPHG DW LQIRUPLQJ WKH OD\ SXEOLF DV ZHOO DV
FOLQLFDO IDFXOW\ DQG VFLHQWLVWV RQ VRPH RI WKH LVVXHV WKDW KDYH DULVHQ RXW RI JUHDWHU
XQGHUVWDQGLQJ RI KXPDQ UHSURGXFWLYH SURFHVVHV WKURXJK PHGLFDOO\ DVVLVWHG UHSURGXFWLYH
WHFKQLTXHV /LWWOH NQRZQ IDFWV DERXW PDOH LQIHUWLOLW\ ZHUH FRYHUHG E\ 1 3DQGL\DQ
$QGURORJ\DQG5HSURGXFWLYH6FLHQFHV$SROOR+RVSLWDOV&KHQQDL ,QIHUWLOLW\LVDSHUVRQDO
WUDJHG\LQWKHOLYHVRIPDQ\FRXSOHV

0DOHIDFWRUVDUHHTXDOO\UHVSRQVLEOHIRULQIHUWLOLW\DVDUHWKRVHRIWKHIHPDOH0XFKKDV
EHHQ ZULWWHQ DERXW WKH FDXVHV RI PDOH LQIHUWLOLW\ 6H[XDO G\VIXQFWLRQ  LJQRUDQFH RI VH[XDO
SUDFWLFHV OLNH XVLQJ OXEULFDQWV GXULQJ LQWHUFRXUVH DOVR FRQWULEXWH WR PDOH LQIHUWLOLW\ 6HPHQ
DQDO\VLVUHPDLQVWKHVLQJOHPRVWLPSRUWDQWWHVWIRUWKHHYDOXDWLRQRIDQLQIHUWLOHPDOHGHVSLWH
DOOLWVOLPLWDWLRQV


ϯϬϬ

 &RPSXWHU $VVLVWHG 6HPHQ $QDO\VLV &$6$  KDV QRW UHSODFHG FRQYHQWLRQDO VHPHQ
DQDO\VLV 0HQZLWKDEQRUPDOVHPHQSLFWXUHZRXOGUHTXLUH IXUWKHU LQYHVWLJDWLRQV OLNH VHUXP
)6+VFURWDO'RSSOHUDQGJHQHWLFVWXGLHV6HUXP/+SURODFWLQDQGWHVWRVWHURQHHVWLPDWLRQV
DUHUHTXLUHGRQO\LQPHQZLWKVH[XDOG\VIXQFWLRQDQGORVVRIOLELGR6SHUPIXQFWLRQVWXGLHV
DUHRIOLPLWHGFOLQLFDOYDOXH5HFHQWGDWDLQGLFDWHWKDWLQYLYRVSHUPDWR]RDPRYHPHQWVDUHQRW
UDQGRPPRYHPHQWVEXWDUHGLUHFWHGE\FKHPRWD[LVDQGWKHUPRWD[LV

7KHLQWURGXFWLRQRI,QWUD8WHULQH,QVHPLQDWLRQ ,8, ,9)DQG,QWUD&\WRSODVPLF6SHUP
,QMHFWLRQ ,&6,  KDYH DOO SURYHQ WR EH RI LPPHQVH YDOXH LQ WKH PDQDJHPHQW RI PDOH
LQIHUWLOLW\+RZHYHUWKHVHQHZWHFKQLTXHVKDYHQRWHOLPLQDWHGWKHSUREOHPRIPDOHLQIHUWLOLW\
DV ZDV FODLPHG LQ WKH PLG DQG ODWH QLQHWLHV 7KH SUREOHP RI PDOH LQIHUWLOLW\ VWLOO UHPDLQV
&ORQLQJ RU KDSORLGL]DWLRQ RU VWHP FHOO WKHUDS\ PD\ EH WKH RQO\ DQVZHU IRU ELRORJLFDO
IDWKHUKRRGIRUPDQ\RIWKHVHPHQµ,WLVDOOLQWKHHQYLURQPHQW,QFLGHQFHRIPDOHLQIHUWLOLW\
YDULHVEHWZHHQUHJLRQV LQ LQIHUWLOH FRXSOHV¶ZDVSUHVHQWHGE\5DMYL0HKWD +RSH,QIHUWLOLW\
&OLQLF%DQJDORUH 1HDUO\RILQIHUWLOLW\LVUHODWHGWRUHSURGXFWLYHGHIHFWVRUGLVRUGHUVLQ
WKHPDOHWKHUHVWLVUHODWHGWRWKHIHPDOH7KHUHKDVEHHQJURZLQJHYLGHQFHWRVXJJHVWWKDWLQ
VRPH UHJLRQV WKH LQFLGHQFH RI PDOH LQIHUWLOLW\ DPRQJVW LQIHUWLOH FRXSOHV YDULHV EHWZHHQ
UHJLRQV 6XFK HYLGHQFH KDV EHHQ DFFUXLQJ IURP GLIIHUHQW SDUWV RI WKH ZRUOG DQG EHWZHHQ
GLIIHUHQW,QGLDQFLWLHV

$ SUHOLPLQDU\ VWXG\ LQ ,QGLD VKRZV WKDW VLJQLILFDQW GLIIHUHQFHV RFFXU ERWK LQ VHPHQ
TXDOLW\ DQG VSHUP FRQFHQWUDWLRQV LQ IHUWLOH FRXSOHV 7KHUH LV UHDVRQ WR EHOLHYH WKDW
HQYLURQPHQWDOIDFWRUVSOD\DQLPSRUWDQWUROHLQ WKLVPDQLIHVWDWLRQ 7KHUH LV D QHHG WR FDUU\
RXWDQDWLRQDOVWXG\RIHQYLURQPHQWDOIDFWRUV DIIHFWLQJPDOHIHUWLOLW\µ,WLVDOOLQRXUJHQHV
*HQRPLFV RI PDOH LQIHUWLOLW\¶ ZDV SUHVHQWHG E\ . .XFKHULD 1 3 *XSWD DQG 5LPD 'DGD
$OO,QGLD,QVWLWXWHRI0HGLFDO6FLHQFHV1HZ'HOKL 7HQWRFRXSOHVILQGGLIILFXOW\WR
SURFUHDWH 0LFUR GHOHWLRQ RI WKH ORQJ DUP RI WKH < FKURPRVRPH LV DVVRFLDWHG ZLWK
VSHUPDWRJHQLF IDLOXUH DQG KDV EHHQ XVHG WR GHILQH WKUHH UHJLRQV RQ <T $=)D $=)E DQG
$=)F ZKLFKDUHFULWLFDOIRUVSHUPDWRJHQHVLV7KHVHORFLDFWDWGLIIHUHQWVWDJHVRIJHUPFHOO
GHYHORSPHQW DQG GHOHWLRQ RI HDFK ORFXV UHVXOWV LQ D FKDUDFWHULVWLF SKHQRW\SH 'HOHWLRQ RI
$=)D$=)EDQG$=)FUHVXOWVLQ6HUWROL&HOO2QO\ 6&2 V\QGURPHPDWXUDWLRQDUUHVWDQG
K\SRVSHUPDWRJHQHVLV UHVSHFWLYHO\ 2QH KXQGUHG DQG VHYHQW\ ILYH LQIHUWLOH PDOHV ZLWK
LGLRSDWKLF ROLJR]RRVSHUPLD DQG D]RRVSHUPLD ZHUH LQFOXGHG LQ RQH VWXG\ &\WRJHQHWLF DQG
VHPHQ DQDO\VLV ZDV GRQH LQ HDFK FDVH 7HVWLFXODU )LQH 1HHGOH DVSLUDWLRQ &\WRORJ\ ZDV
FROOHFWHG ZKHQHYHU SRVVLEOH 2I WKH  FDVHV  ZHUH LGHQWLILHGDV .OLQHIHOWHU 6\QGURPH
.)6 FDVHVZHUHPRVDLF.)6DQGFDVHVZHUHYDULDQW.)6

9DULRXVIDFWRUV±JHQHWLFHSLJHQHWLFDQGHQYLURQPHQWDO±PRGXODWHWKHHIIHFWRIWKHVH
JHQHV7KXVLQDODUJHQXPEHURILGLRSDWKLFFDVHVRIPDOHLQIHUWLOLW\WKHUHLVDJHQHWLFEDVLV
7KHUHIRUH GHWHFWLRQ RI <T PLFUR GHOHWLRQV HQFRPSDVVLQJ WKH $=) ORFL GHWHUPLQHV WKH
SURJQRVLV DQG PDQDJHPHQW RI WKHVH LQIHUWLOH FDVHV µ7KH GDZQ RI D QHZ HUD LQ
ELRWKHUDSHXWLFV (PEU\RQLF VWHP FHOOV IRU RUJDQ UHSDLU RU UHSODFHPHQW¶ ZDV SUHVHQWHG E\
6DWLVK 7RWH\ 5HOLDQFH /LIH 6FLHQFHV 0XPEDL  7KHUH KDV EHHQ PXFK KRSH DQG K\SH
DVVRFLDWHG ZLWK HPEU\RQLF VWHP FHOOV ZLWK UHIHUHQFH WR WKHLU SRVVLEOH XVH LQ IXWXULVWLF
ELRWKHUDSLHV DQG UHJHQHUDWLYH PHGLFLQH +RZHYHU DV LQ WKH FDVH RI HDUOLHU KRSHV DQG HYHQ
FODLPV LQ DUHDV VXFK DV XVH RI PRQRFORQDO DQWLERGLHV JHQH WKHUDS\ HWF IRU WUHDWPHQW RI
GLVHDVHV WKHUH LV DV \HW QR FOHDU HYLGHQFH WR VXSSRUW WKH FRQFHSW RI HPEU\RQLF VWHP FHOOV
EHLQJ WDNHQ XS LQ WKH QHDU IXWXUH DV ELRWKHUDSHXWLF DJHQWV 7KLV LV EHFDXVH VHYHUDO EDVLF
TXHVWLRQVQHHGWREHDQVZHUHG
6RPHRIWKHVHTXHVWLRQVSHUWDLQWR

ϯϬϭ

 
 ,PPXQRUHMHFWLRQRIVWHPFHOOVZKHQWUDQVIHUUHGWRDQRWKHULQGLYLGXDO
 ,GHQWLI\LQJFHOOVVLJQDOVWKDWGULYHWKHGHYHORSPHQWDOFRXUVHRIXQGLIIHUHQWLDWHGVWHP
FHOOV
 *URZLQJVWHPFHOOVLQPHGLXPIUHHIURPDQLPDOSURGXFWVWRDYRLG]RRQRVHV

µ2SSRUWXQLWLHV RIIHUHG E\ WKH JRYHUQPHQW RI ,QGLD IRU HVWDEOLVKLQJ FRRSHUDWLYH
UHVHDUFK DVVRFLDWLRQV DQG DVVLVWDQFH WKURXJK SURJUDP DLPHG DW WHFKQRORJLFDO VHOI UHOLDQFH
3$67(5 ¶ ZDV SUHVHQWHG E\ 7 & $QDQG .XPDU +RSH ,QIHUWLOLW\ &OLQLF %DQJDORUH 
5HVHDUFK LQ LQIHUWLOLW\ WR XQGHUVWDQG VRPH RI WKH XQH[SODLQHG FRQGLWLRQV RI LQIHUWLOLW\
GHYHORSLQJQHZDQGEHWWHUIRUPVRIWUHDWPHQWDWWDLQLQJVHOIUHOLDQFHLQSURGXFWVXVHGLQWKH
WUHDWPHQWRILQIHUWLOLW\UHTXLUHVVXEVWDQWLDOLQSXWVRIWHFKQLFDOWDOHQWVDVZHOODVIXQGLQJ0RVW
RI LQIHUWLOLW\ WUHDWPHQW OLHV LQ WKH SULYDWH VHFWRU &6,5 KDV D VFKHPH WKDW VXSSRUWV SULYDWH
LQGXVWU\ WKDW LV RI D FRRSHUDWLYH QDWXUH (VWDEOLVKLQJ D FROODERUDWLYH FRRSHUDWLYH UHVHDUFK
IDFLOLW\LQLQIHUWLOLW\UHVHDUFKZKLFKLVDPXOWLFURUHEXVLQHVVLQGXVWU\PD\EHDJRRGZD\RI
DWWDLQLQJVHOIVXIILFLHQF\LQWKLVLQGXVWU\

,QYLWURIHUWLOL]DWLRQWHFKQLTXHVDUHPDLQO\RIIHUHGE\WKHSULYDWHVHFWRUZKLFKLVYHU\
KHDYLO\ GHSHQGHQW RQ LPSRUWHG GUXJV HTXLSPHQW DQG GHYLFHV LQFOXGLQJ GLVSRVDEOH SODVWLF
ZDUH XVHGLQ LQYLWURFXOWXUH &RQVHTXHQWO\WKHFRVW RI ,9) LV H[WUHPHO\KLJKLQ,QGLDDQG
XQDIIRUGDEOHWRPDQ\5HVHDUFKLQWRDVSHFWVRIKXPDQUHSURGXFWLRQLVDOPRVWQRQH[LVWHQWLQ
WKH SULYDWH VHFWRU DQG WKHUH LV KDUGO\ DQ\ VFLHQWLILF SDSHU WKDW HPHUJHV IURP ,QGLDQ
ODERUDWRULHV RU FOLQLFV SUDFWLVLQJ ,9) ,Q WKH V\PSRVLXP FROODERUDWLRQ EHWZHHQ WKH SULYDWH
DQG SXELF VHFWRU IXQGLQJ DJHQFLHV ZDV VWUHVVHG ([DPSOHV ZHUH JLYHQ RI WKH SURJUDPPHV
DYDLODEOH XQGHU WKH 'HSDUWPHQW RI 6FLHQWLILF DQG ,QGXVWULDO 5HVHDUFK VXFK DV WKH 3URJUDP
$LPHG DW 7HFKQRORJLFDO 6HOI5HOLDQFH 3$76(5  DQG &RRSHUDWLYH 5HVHDUFK $VVRFLDWLRQV
WKDWHQDEOHWKHHVWDEOLVKPHQWRIUHVHDUFKFHQWUHVDVDFROODERUDWLYHHIIRUWEHWZHHQWKHSULYDWH
VHFWRU DQG *RYHUQPHQW IXQGLQJ DJHQFLHV 7KLV DVSHFW ZDV DSSUHFLDWHG E\ WKH SDUWLFLSDQWV
ZKRHQGRUVHGWKHYLHZWKDWVLPLODUFROODERUDWLRQVPXVWEHHVWDEOLVKHGEHWZHHQSULYDWH,9)
FOLQLFV DQG HYHQ WKH ,&05 WR DGGUHVV LVVXHV WKDW DUH RI FRPPRQ LQWHUHVW DQG DUHDLPHG DW
LPSURYLQJSDWLHQWFDUHDQGPRUHLPSRUWDQWO\SURYLGLQJLQGLJHQRXVVXEVWLWXWHVIRULPSRUWHG
HTXLSPHQWVXSSOLHVDQGGUXJV












ϯϬϮ

 
&KDSWHU
*HQHWKHUDS\

,QWURGXFWLRQ

*HQHVDUHPDGHRI'1$WKHFRGHRIOLIH7KH\DUHPDGHRIDVHTXHQFHRIFKHPLFDOV
ZLWKWKHLQLWLDOV$&*DQG7MXVWOLNHWKHDOSKDEHWPDNHVZRUGVDQGVHQWHQFHVZKLFKFDQ
EHWXUQHGLQWRLQVWUXFWLRQV(YHU\RQHLQKHULWVJHQHVIURPWKHLUSDUHQWVDQGSDVVHVWKHPRQLQ
WXUQ WR WKHLU FKLOGUHQ (YHU\ SHUVRQ V JHQHV DUH GLIIHUHQW DQG WKH FKDQJHV LQ VHTXHQFH
GHWHUPLQH WKH LQKHULWHG GLIIHUHQFHV EHWZHHQ HDFK RI XV 6RPH FKDQJHV XVXDOO\ LQ D VLQJOH
JHQH PD\ FDXVH VHULRXV GLVHDVHV VXFK DV &\VWLF )LEURVLV 0XVFXODU '\VWURSK\ RU
7KDODVVHPLD  0RUH RIWHQ JHQH YDULDQWV LQWHUDFW ZLWK WKH HQYLURQPHQW WR SUHGLVSRVH VRPH
SHRSOHWR&DQFHURU+HDUW GLVHDVHRURWKHUFRPPRQDLOPHQWV7RGD\GRFWRUVFDQORRNDWD
SHUVRQ V'1$XVLQJYHU\VHQVLWLYHQHZWHFKQLTXHVZKLFKXVHDVOLWWOHDVRQHKDLUURRWRUGURS
RIEORRG

*HQHWKHUDS\LQYROYHVWKHLQWURGXFWLRQRIJHQHWLF PDWHULDO LQWRDFHOOWRWUHDW GLVHDVH
0DQ\ RI WKH FRQGLWLRQV WUHDWHG LQ WKLV ZD\ DUH JHQHWLF GLVHDVHV WKDW RFFXU ZKHQ JHQHV
PDOIXQFWLRQ$FRPPRQDSSURDFKLQJHQHWKHUDS\LVWRLGHQWLI\DPDOIXQFWLRQLQJJHQHDQG
VXSSO\WKHSDWLHQWZLWKIXQFWLRQLQJFRSLHVRIWKDWJHQH2WKHUDSSURDFKHVLQFOXGHVZLWFKLQJ
VSHFLILF JHQHV RQ RU RII LQWURGXFLQJ JHQHV WR NLOO FDQFHU FHOOV WR VXSSUHVV WXPRXUV E\
LQKLELWLQJWKHEORRGVXSSO\RUWRVWLPXODWHWKHLPPXQHV\VWHPWRDWWDFNFHUWDLQW\SHVRIFHOOV
:KLFKHYHUDSSURDFKLVXVHGWKHDLPRIJHQHWKHUDS\LVWRLQWURGXFHWKHUDSHXWLFPDWHULDOLQWR
WKHWDUJHWFHOOVIRUWKLVWREHFRPHDFWLYHLQVLGHWKHSDWLHQWDQGH[HUWWKHLQWHQGHGWKHUDSHXWLF
HIIHFW$WSUHVHQWJHQHWKHUDS\LVVWLOODWWKHFOLQLFDOUHVHDUFKVWDJH7KH8.&OLQLFDO7ULDOV
5HJXODWLRQV  SURKLELW JHQH WKHUDS\ RQ UHSURGXFWLYH JHUP OLQH  FHOOV LW FDQ RQO\ EH
FDUULHGRXWRQQRQUHSURGXFWLYH VRPDWLF FHOOV*HUPOLQHJHQHWKHUDS\FDQSRWHQWLDOO\FDXVH
FKDQJHVLQDSDWLHQWLQFOXGLQJKDUPIXOHIIHFWVWKDWFRXOGEHSDVVHGRQWRIXWXUHJHQHUDWLRQV
,W LV WKHUHIRUH FXUUHQWO\ FRQVLGHUHG XQDFFHSWDEOH IRU ERWK HWKLFDO DQG VDIHW\ UHDVRQV *HQH
WKHUDS\LVµWKHXVHRIJHQHVDVPHGLFLQH¶,WLQYROYHVWKHWUDQVIHURIDWKHUDSHXWLFRUZRUNLQJ
JHQH FRS\ LQWR VSHFLILF FHOOV RI DQ LQGLYLGXDO WR UHSDLU DIDXOW\ JHQH FRS\ 7KXV LW PD\ EH
XVHG WR UHSODFH D IDXOW\ JHQH RU WR LQWURGXFH D QHZ JHQH ZKRVH IXQFWLRQ LV WR FXUH RU WR
IDYRXUDEO\PRGLI\WKHFOLQLFDOFRXUVHRIDFRQGLWLRQ7KHVFRSHRIWKLVQHZDSSURDFKWRWKH
WUHDWPHQWRIDFRQGLWLRQLVEURDGZLWKSRWHQWLDOLQWKHWUHDWPHQWRIPDQ\JHQHWLFFRQGLWLRQV
VRPHIRUPVRIFDQFHUDQGFHUWDLQYLUDOLQIHFWLRQVVXFKDV$,'6

*HQHWKHUDS\UHPDLQVDQH[SHULPHQWDOGLVFLSOLQHKRZHYHUDQGPXFKUHVHDUFKUHPDLQV
WR EH GRQH EHIRUH WKLV DSSURDFK WR WKH WUHDWPHQW RI FHUWDLQ FRQGLWLRQV ZLOO UHDOLVH LWV IXOO
SRWHQWLDO

6RPDWLF*HQH7KHUDS\

2XU FHOOV DUH GLYLGHG LQWR WZR JURXSV WKH VRPDWLF FHOOV ZKLFK PDNH XS WKH ZRUNLQJ
SDUWVRIWKHERG\DQGWKHJHUPFHOOV RUVH[FHOOVVSHUPLQPHQDQGHJJVLQZRPHQ ZKLFK
SDVVRQJHQHWLFPDWHULDOWRRXUFKLOGUHQ(YHU\QRUPDOVRPDWLFFHOOFRQWDLQVWKHVDPHFRGHG
'1$ LQVWUXFWLRQV HYHQ LI RQO\ VRPH RI WKHP DUH XVHG 'LIIHUHQW RQHV ZLOO EH DFWLYH LQ
GLIIHUHQWSDUWVRIWKHERG\,IDERG\FHOOLVPRGLILHGE\6RPDWLF*HQH7KHUDS\LWZLOORQO\

ϯϬϯ

FKDQJH FHOOV LQ WKH ERG\ RI WKH SHUVRQ EHLQJ WUHDWHG DQG QRW EH SDVVHG RQ WR FKLOGUHQ
6RPDWLFJHQHWKHUDS\FDQEHWDUJHWHGWRIRUH[DPSOHWKHOLYHUEORRGRUOXQJVWRFRUUHFWD
PHGLFDO SUREOHP ZKLFKH[LVWVDQG ZKLFK FDQ EH WUHDWHG E\WKH JHQH RU LWV SURWHLQ SURGXFW
VXFKDVDQLQKHULWHGGLVHDVHRUFDQFHU

$SSOLFDWLRQWR6RPDWLF&HOO7KHUDS\
6R IDU DV ZH NQRZ WKHUH KDV EHHQ QR FRPPLWWHH DQ\ZKHUH WKDW KDV UHFRPPHQGHG
RXWULJKW SURKLELWLRQV RIDOO VRPDWLF FHOO JHQH WKHUDS\ 7KH H[FHOOHQW  5HSRUW ³6SOLFLQJ
/LIH´ 8QLWHG6WDWHV3UHVLGHQWLDO&RPPLVVLRQIRUWKH6WXG\RI(WKLFDO3UREOHPVLQ0HGLFLQH
DQG %LRPHGLFDO DQG %HKDYLRUDO 5HVHDUFK  ODLG WKH JURXQGZRUN IRU ZRUOGZLGH UHFRJQLWLRQ
WKDW WKH HWKLFDO SUREOHPV SUHVHQWHG E\ VXFK WKHUDSLHV DUH QRW IXQGDPHQWDOO\ GLIIHUHQW IURP
WKRVHSUHVHQWHGE\RWKHUUHVHDUFKWHFKQLTXHV$OOPHPEHUVRIWKH6XEFRPPLWWHHFRQFXU
&RQWUDU\DUJXPHQWVZHEHOLHYHZRXOGKDYHWREHEDVHGRQFODLPVWKDW
D  WKHUH LV DQ LPSHUPLVVLEOH KLJK FKDQFH RI DFFLGHQWV FDXVLQJ ODUJH GHVWUXFWLRQ WR SHUVRQV
SURSHUW\RUWKHHQYLURQPHQWWKDWZLOOXOWLPDWHO\RFFXUWKURXJKDFFLGHQWDOUHOHDVHRIYLUDORU
RWKHUPDWHULDOV
E  DFFLGHQWV LQ VRPDWLF FHOO WKHUDS\ VRRQHU RU ODWHU ZLOO UHVXOW LQ WKH DOWHUDWLRQ RI JHUPOLQH
FHOOVRU
F  WKH FUHDWLRQ RI VRPDWLF WKHUDSLHV SXWV XV RQ WKH VOLSSHU\ VORSH WR ZURQJIXO JHUPOLQH
LQWHUYHQWLRQVVORSHZKLFKZHFDQQRWKROG

7KH ILUVW DUJXPHQW KDV HFKRHV LQ GHEDWHV DERXW WKH FRQVWUXFWLRQ RI QXFOHDU SRZHU
SODQWV :H EHOLHYH WKH SUHPLVH ZURQJ HYHQ RQ WKH DVVXPSWLRQ DFFLGHQWV PD\ KDSSHQ
)XUWKHUPRUH WR DFFHSW WKH DUJXPHQW ZRXOG LPSO\ WKH LPSHUPLVVLELOLW\ RI WKH IXOO UDQJH RI
JHQHWLFWHFKQRORJLHVWHFKQRORJLHV WKDW ZLOO KDYH PDMRULPSDFW LQ ZRUOG HFRQRPLFOLIH7KH
SURKLELWLRQV WKDW ZRXOG IORZ IURP DFFHSWLQJ WKLV ULVN DUJXPHQW DUH QRW OLPLWHG LI LW EH
WKRXJKWDOLPLW WRWUHDWPHQWVRILOOSHRSOH

$VWRWKHVHFRQGDUJXPHQWUHVHDUFKHUVFDQQRWUXOHRXWRUGHSUHFLDWHWKHSURVSHFWWKDW
VRPH PLVKDS PD\ DOWHU VRPHRQH V JHUPOLQH FHOOV SDUWLFXODUO\ DV WHFKQLTXHV WR DGPLQLVWHU
JHQHLQVHUWLRQLQYLYRDUHGHYHORSHG,VWKHSRVVLEOHDFFLGHQWDODOWHUDWLRQRIDJHUPOLQHFHOOD
EDVLVIRUWRWDOSURKLELWLRQRIDOOVRPDWLFFHOOJHQHWKHUDS\":HWKLQNQRW
5LVNVPD\DQGPXVWEHPLQLPL]HGE\PDLQWDLQLQJDFRQVWDQWIRFXVRQVDIHW\%XWPRUH
LPSRUWDQWWKHKXPDQJHQRPHLVE\QRPHDQVVWDEOH,WFRQVWDQWO\FKDQJHVWKURXJKPXWDWLRQ
LQFOXGLQJPDQ\PXWDWLRQV WKDW UHVXOW IURP KXPDQ DFWLYLWLHV 0RVWPXWDWLRQVRIFRXUVHDUH
VHOHFWHGDJDLQVW7KH\IDLOWRVXUYLYH7KHVDPHZRXOGEHWUXHZLWKWKHVHNLQGVRIDFFLGHQWV

7KHVOLSSHU\VORSHDUJXPHQWE\FRQWUDVWLVLWVHOIDQDUJXPHQWZLWKRXWVWRSSLQJSRLQW
,WZRXOGOHDGWREDQVRQDLUSODQHVEHFDXVHWKH\PLJKWEHXVHGWRGURSERPEV 6DVV ,I
SHRSOHEHOLHYHPDLQWDLQLQJ VKDUS ERXQGDULHV DJDLQVW JHUPOLQH LQWHUYHQWLRQLVLPSRUWDQW ZH
WKLQNVRFLDOOHJDODQGSURIHVVLRQDOVWDQGDUGVZLOOKROGWKHOLQHDGHTXDWHO\SDUWLFXODUO\JLYHQ
WKHWHFKQLFDOFKDOOHQJHVVXFKLQWHUYHQWLRQVZRXOGKDYHWRRYHUFRPH
7KHVHSRVVLEOHDUJXPHQWVDJDLQVWVRPDWLFFHOOWKHUDS\GRQRWUHVSHFWDGHTXDWHO\ULJKWV
WRIUHHGRPLQVFLHQWLILFUHVHDUFKWKHGXW\WRSURWHFWWKHYXOQHUDEOHDQGWKHULJKWVWRHQMR\WKH
EHQHILWVRIVFLHQWLILFSURJUHVV
ϯϬϰ

(WKLFDO2YHUVLJKWRI6RPDWLF&HOO7KHUDS\
7KHSULQFLSDOSUREOHPVLQVRPDWLFFHOOWKHUDS\LQYROYHDGHTXDWHVXSHUYLVLRQERWKRIWKH
VDIHW\RIUHVHDUFKSUDFWLFHVLQWKHODERUDWRU\DQGRIWKHGHFLVLRQWRLQLWLDWHKXPDQVWULDOVDQG
WKHPHWKRGVIRUVHFXULQJIXOOLQIRUPDWLRQIURPWKHP

:HZLOOQRWUHKHDUVHGLVFXVVLRQVHOVHZKHUH HJ&ORWKLHU&RPPLVVLRQ DERXWWKH
NLQGVRIGHWDLOHGNQRZOHGJHDQGSUHSDUDWLRQWKDWVKRXOGEHUHTXLUHGEHIRUHDSSURYLQJYHFWRUV
DQG JHQHV IRU FOLQLFDO WULDOV )URP DQ\ HWKLFDO VWDQGSRLQW ZH NQRZ DERXW WKH FHQWUDO
UHVSRQVLELOLW\LVWRPD[LPL]HWKHJDLQVDQGPLQLPL]HWKHULVNVDQGXOWLPDWHO\GHFLGHZKHWKHU
RU QRW WKH EHQHILWV UHDOLVWLFDOO\ WR EH JDLQHG PDNH OHJLWLPDWH DVNLQJ RWKHUV WR UXQ WKH ULVNV
LQYROYHG

7KUHH SRLQWV DERXW WKLV SURFHVV DUH ZRUWK PHQWLRQLQJ EHFDXVH WKH\ IORZ IURP RXU
EHOLHIWKDWJHQHWKHUDS\ZLOOSURYHWREHDEURDGO\HQDEOLQJWHFKQRORJ\)LUVWLIZHDUHULJKW
QHZSRVVLELOLWLHVIRULWVXVHZLOOEHK\SRWKHVL]HGFRQVWDQWO\7KHGHVLUHWRXVHWKHWHFKQRORJ\
PD\QRWFRH[LVWZLWKWKHNQRZOHGJHRIKRZWRGRLWVDIHO\7KHLQWHUQDWLRQDOFRPPXQLW\KDV
DVWURQJLQWHUHVWLQIDFLOLWDWLQJWUDQVIHURIDSSURSULDWHDVVLVWDQFHWRPDLQWDLQVDIHW\VWDQGDUGV

6HFRQGSHULRGVRIVXGGHQHQWKXVLDVPIRUQHZPHGLFDOWHFKQRORJLHVSXWSUHVVXUHRQWKH
SUHVHUYDWLRQ RI KXPDQ ULJKWV LQ PHGLFDO UHVHDUFK 3K\VLFLDQV VKRXOG QRW KDVWLO\ DGRSW
WHFKQLTXHV ZLWKRXW DGHTXDWH SUHSDUDWLRQ 5HVHDUFK SURWRFROV QHHG LQWHUGLVFLSOLQDU\ UHYLHZ
ZLWKSDUWLFXODUGLOLJHQFHDQGDFDUHIXOLPSDUWLDOZHLJKLQJRIULVNVDQGEHQHILWV([SHULPHQWDO
VXEMHFWVQHHGERWKIXOODQGIDLUH[SODQDWLRQRIWKHSURFHGXUHVDQGKRQHVWLQIRUPDWLRQDERXW
WKHUHODWLYHEDODQFHEHWZHHQUHVHDUFKLQWHUHVWDQGWKHUDSHXWLFSURVSHFWV,QSDUWLFXODUFRQVHQW
VXEPLVVLRQVWKDWLQIRUPDSDWLHQW³WKLVPD\EHQHILW\RX´ZLWKRXWGLVFORVLQJUHDOLVWLFDOO\WKH
PDQ\XQFHUWDLQWLHVDQGWKHLPSUREDELOLWLHVRIKDYLQJVROYHGDOOWKHWHFKQLFDOEDUULHUVRQWKH
ILUVWWU\VKRXOGEHDYRLGHG

7KLUGGLVFXVVLRQVRIFRQVHQWWRVRPDWLFFHOOWKHUDS\H[SHULPHQWVLQWKHOLWHUDWXUHVHHP
GULYHQDQGGULYHQWRH[FHVVJLYHQWKHWHFKQRORJ\ VSUHVHQWXVHE\PRGHOVRIH[SHULPHQWLQJ
RQFKLOGUHQZLWKJHQHWLFGLVHDVH,QVXFKVHWWLQJVRIFRXUVHWKHUHTXLUHPHQWVRISULRUSURRI
RI SULQFLSOH DQG UHDOLVWLF OLNHOLKRRG RI VXFFHVV DUH PD[LPDO $ OLIHWLPH RI WUHDWPHQW LV
FRQWHPSODWHGLQDSHUVRQZKRFDQQRW\HWVSHDNDGHTXDWHO\IRUKLVRUKHURZQLQWHUHVWV%XW
RQH VKRXOG QRW IDVWHQ RQ DGXOWV ZKR VXIIHU JHQHWLF GLVHDVH LPSRVVLEO\ KLJK VWDQGDUGV IRU
SURWRFRO LQLWLDWLRQ $V WKH LQIOXHQWLDO &ORWKLHU &RPPLVVLRQ QRWHG ZH PD\ IRUHVHH FDVHV RI
WHUPLQDOO\ LOO DGXOWV FRQVHQWLQJ WR JHQH WKHUDS\ UHVHDUFK UHFRJQL]LQJ LWV SUREDEOH ODFN RI
GLUHFW WKHUDSHXWLF EHQHILW 7KDW PRGHO KDV ORQJ FKDUDFWHUL]HG FDQFHU UHVHDUFK DQG SHUKDSV
WRR PXFK VR  EXW LWV SUHYDOHQFH PD\ H[SODLQ WKH UHODWLYH HDVH RI VHFXULQJ FDQFHU SURWRFRO
DSSURYDOV

7KH EDVLF DSSURDFK VKRXOG EH WKH PRUH WKDW JHQHWLF WKHUDS\ EHFRPHV OLNH DQ\ RWKHU
WKHUDS\WKHPRUHUHVHDUFKUHYLHZVKRXOGEHDVVLPLODWHGWRFRQYHQWLRQDOSURFHGXUHVZKHQWKH
WHFKQLTXHVRIJHQHLQVHUWLRQDUHVWDQGDUGRQHV7KLVSURFHVVLVXQGHUZD\LQWKH8QLWHG6WDWHV
ZLWK WKH DEVRUSWLRQ RI WKH +XPDQ *HQH 7KHUDS\ 5HYLHZ &RPPLWWHH LQWR WKH SDUHQW
5HFRPELQDQW'1$$GYLVRU\&RPPLWWHHWKHUHDGLQHVVE\WKH5$&WRSHUPLWFRPSDVVLRQDWH
XVHRIJHQHWKHUDS\SURWRFROVDQGWKHUHFHQWSURSRVDODQGWHQWDWLYHDJUHHPHQWIRU)'$WR
WDNHRYHUIURP5$&UHYLHZRIJHQHWKHUDS\SURSRVDOVSUHVHQWLQJQRQRYHOLVVXHV7KHILUVW

ϯϬϱ

JHQH WKHUDS\ SURWRFRO $QGHUVRQ V  $'$ H[SHULPHQW ZDV UHYLHZHG  WLPHV E\ 
GLIIHUHQW UHJXODWRU\ ERGLHV $ PHUH ILYH \HDUV ODWHU PDQ\ SURWRFROV FDQ EH DSSURYHG RQ D
VWDQGDUG)'$UHYLHZ


6RPDWLF&HOO7KHUDSLHVDQGWKH3UREOHPRI(QKDQFHPHQW(QJLQHHULQJ

5HFHQWJHQHWKHUDS\GLVFXVVLRQVLQVLVWWKDWVRPDWLFFHOOSURFHGXUHVVKRXOGEHUHVHUYHG
IRU VHULRXV GLVHDVH 7KH 6XEFRPPLWWHH FRQFXUV LQ WKDW YLHZ EHFDXVH RI WKH KLJKO\
H[SHULPHQWDOQDWXUHRISURFHGXUHVDQGWKHODFNRIVXIILFLHQWH[SHULHQFHIRUGHWHUPLQDWLRQRI
WKH LQFLGHQFH DQG VHULRXVQHVV RI VLGHHIIHFWV WKDW DFFRPSDQ\ YDULRXV W\SHV RI FHOOXODU
DOWHUDWLRQV

$FHOOSHUIRUPVFRPSOH[FKHPLFDOSURFHVVHVWKURXJKPDQ\SDWKZD\V,WLVIDUWRRVRRQ
IRU FRQILGHQFH WKDW LPSRVLQJ RQ LW D QHZ PDQXIDFWXULQJ UHVSRQVLELOLW\ ZLWK HQHUJ\
UHTXLUHPHQWV WKDW PXVW FRPH IURP VRPHZKHUH ZLOO QRW VRPHKRZ DIIHFW WKH ZD\ LW DQG
WKURXJK DFWLRQ RQ LW DFWLRQ RQ RWKHU FHOOV  SHUIRUPV RWKHU WDVNV 6HFRQG KRZ VWDEOH LV
WUDQVIHFWLRQ" 'R LQVHUWHG JHQHV DOZD\V VWD\ SXW RU FDQ WKH\ UHFRPELQH DQG PRYH WR RWKHU
FHOOVDQGLIVRKRZIUHTXHQWO\GRHVWKLVKDSSHQDQGZLWKZKDWHIIHFWV",WWDNHVWKRXVDQGVRI
FDVHVDQG\HDUVRIH[SHULHQFHIRUFRQILGHQW HOLPLQDWLRQ RIDOO WKHXQKDSS\SRVVLELOLWLHV1R
UHVSRQVLEOHHWKLFVFRPPLWWHHFRXOGDWSUHVHQWDSSURYHDSURWRFROGLUHFWHGDWDGLVHDVHLWGLG
QRWUHJDUGDVVHULRXV

:KDWLVDVHULRXVGLVHDVH"'HVSLWHWKHGLYHUVLW\RIFXOWXUHVDQGZRUOGYLHZVZHEHOLHYH
WKHLQWHUQDWLRQDOFRPPXQLW\ZRXOGUHDFKYLUWXDOXQDQLPLW\RQDORQJOLVWRIVHULRXVGLVHDVHV
DQGWKDWOLVWZRXOGLQFOXGHFXUUHQWWDUJHWVRIJHQHWKHUDS\SURWRFROVVXFKDVF\VWLFILEURVLV
$'$ GHILFLHQF\ )DQFRQL V DQHPLD FDQFHU DQG $,'6 0RUHRYHU VRPH NLQGV RI SURWRFROV
WKDWHQKDQFHKXPDQSHUIRUPDQFHIRUH[DPSOHE\SXWWLQJLQJHQHVWKDWSURWHFWDQLQGLYLGXDO
DJDLQVWVHULRXVGLVHDVHPXVWEHFRQFHSWXDOL]HGDVSURWRFROVDLPHGDWWKDWVHULRXVGLVHDVHDQG
QRWREMHFWHGWRDVHIIRUWVWRLPSURYHPHUHEHKDYLRUDOWUDLWV

7KH GLIIHUHQFHVRI RSLQLRQ DERXW ZKHWKHU WR FODVVLI\ GLVHDVH DV VHULRXV ZLOO EH DW WKH
PDUJLQDQGDWWKHERUGHUOLQHZKHUHGLVHDVHSUHYHQWLRQDQGOLIHVW\OHLQWHUVHFW)RUH[DPSOHLV
D SURWRFRO GHVLJQHG WR UHGXFH RUGLQDU\ FKROHVWHURO OHYHOV DLPHG DW D VHULRXV GLVHDVH LI WKH
VHULRXV GLVHDVH FRXOG EH DYRLGHG E\ HDWLQJ OHVV IDW" ,QWHUHVWLQJO\ WKH 5HSRUW RI WKH
1RUZHJLDQ0LQLVWU\RI+HDOWKDQG6RFLDO$IIDLUVWRWKH6WDUWLQJRQ%LRWHFKQRORJ\5HODWHGWR
+XPDQ%HLQJV DW DFFHSWVWKHOLPLWDWLRQWRVHULRXVGLVHDVHV7KH5HSRUWIXUWKHU
QRWHV WKDW E\ LPSODQWLQJ SURWHFWLYH JHQHV RQH PD\ DYRLG GLVHDVH DQG VXJJHVWV IXWXUH
³IOH[LEOH OLPLWV´ VXFK DV IRU H[DPSOH ³LPSODQWLQJ SLJPHQW FHOOV LQ WKH VNLQ WR DYRLG
VXQEXUQ´

:KHWKHU RU QRW WKHUH LV XQDQLPLW\ DERXW ZKDW FRQVWLWXWHV D VHULRXV GLVHDVH GRHV QRW
VHHPWRXVDQLPSRUWDQWLVVXHLQWKHLQWHUQDWLRQDOFRQWH[W:KDWPDWWHUVLVZKHWKHUZLWKLQWKH
SDUWLFXODUVRFLHW\WKHGLVHDVHLVGHILQHGDVVHULRXVVRDVWRZDUUDQWWKHULVNVRIH[SHULPHQWDO
WUHDWPHQW

ϯϬϲ

 
7KH KDUGHU SUREOHP LV WKDW WKH VHULRXV GLVHDVH OLPLW LV REYLRXVO\ XVHG E\
FRPPHQWDWRUVWRDYRLGWKHQHFHVVLW\IRUSUHVHQWGLVFXVVLRQRIWKHHWKLFVRIXVLQJVRPDWLFFHOO
JHQH WKHUDS\ DW VRPH IXWXUH WLPH IRU SXUSRVHV RI HQKDQFHPHQW 'RHV WKH VHULRXV GLVHDVH
OLPLWUHVW RQPRUDO YLHZV DERXW UHVSHFW IRU KXPDQ GLJQLW\RULVWKHSURKLELWLRQVLPSO\WKDW
VPDOO JDLQV GR QRW ZDUUDQW ELJ ULVNV" $W VRPH SRLQW DQG PHDVXUHG LQ \HDUV UDWKHU WKDQ
GHFDGHVWKHULVNLVVXHVZLOOEHODUJHO\DQVZHUHGZLWKUHVSHFWWRPDQ\RIWKHWHFKQLFDODVSHFWV
RI JHQH WKHUDS\ SDUWLFXODUO\ IRU XVHV WKDW GR QRW LQYROYH ORQJWLPH PDLQWHQDQFH ZLWK
HQJLQHHUHGFHOOV$WWKDWSRLQWVKRXOGVRPDWLFFHOOJHQHWKHUDS\SURFHGXUHVWKDWDUHGHVLJQHG
WR HQKDQFH SHUIRUPDQFH LQ VRPH ZD\ RU DQRWKHU EH UHJDUGHG FDWHJRULFDOO\ DV YLRODWLRQV RI
LQWHUQDWLRQDOKXPDQULJKWVSULQFLSOHVRURWKHUPRUDOYDOXHVDQGLIVRZKLFKRQHVDQGZK\"

2QH PXVW VWDUW E\ QRWLQJ WKDW WKH PHGLFDO PRGHO LV D YHU\ H[SDQVLYH RQH 0DQ\
FRQGLWLRQV EHFRPH GLVHDVHV RU DOPRVW VR LI DV DQG ZKHQ SK\VLFLDQV GHYHORS WKH
FDSDFLW\ WR FKDQJH WKHP 7RRWK GHFD\ LV WKH QDWXUDO IDWH RI KXPDQNLQG EXW ZH FDOO LW D
GLVHDVHDQGLQWHUYHQHWRVWRSLW,IDSURWHLQZHUHIRXQGWKDWRYHUFDPHWKHQDWXUDOORVVRI
PHPRU\ ZLWK DJH SHUKDSV E\ VWUHQJWKHQLQJ &16 OLQNV WKDW QDWXUDOO\ IUD\ ZLWK WLPH IRU
LOOXVWUDWLRQSXUSRVHVRQO\ WKHQZHZRXOGGHILQHWKHPHPRU\ ORVV DVD GLVHDVHDQG XVH WKH
SURWHLQ DQG QRW FRQFHSWXDOL]H RXU DFWLYLW\ DV SHUIRUPDQFH HQKDQFHPHQW 6HFRQG LI VRPH
NLQGVRIHQKDQFHPHQWDUHZURQJWKHZURQJQHVVVKRXOGQRWGHSHQGRQWKHIDFWWKDWJHQH
WKHUDS\LVWKHWHFKQRORJ\XVHGWRDFFRPSOLVKWKHUHVXOW

6RPDWLF JHQH WKHUDS\ PXVW EH DQDO\]HG E\ WKH JHQHUDO SULQFLSOHV JRYHUQLQJ WKH XVHV
DQG OLPLWV RI PHGLFLQH 7KH WLPH ZLOO FRPH ZKHQ FHOOV FDQ EH HQJLQHHUHG IRU HQGRJHQRXV
GUXJ GHOLYHU\ DQG WKHQ HOLPLQDWHG IURP WKH ERG\ E\ DGPLQLVWHULQJ VPDOO PROHFXOH GUXJV
HQJLQHHUHGWR ELQG WR WKH UHOHYDQW FHOOXODU UHFHSWRUVLWH WKDW DFWLYDWHV WKHLQVHUWHG JHQH WKDW
FDXVHV FHOO GHDWK 6RPDWLF FHOO HQKDQFHPHQW WKHUDSLHV PRGHOHG RQ WKH XVH RI VXFK FHOOV
PXVWEHWUHDWHGHTXLYDOHQWO\ZLWKZKDWHYHUUXOHVH[LVWIRUGUXJXVHJHQHUDOO\

7KHHQKDQFHPHQWFDVHPRVWIUHTXHQWO\GLVFXVVHGLQWKHELRHWKLFVOLWHUDWXUHLVZKHWKHU
LW LV HWKLFDO WR LQVHUW D JHQH WR SURGXFH KXPDQ JURZWK KRUPRQH LQ D VKRUW EXW VHHPLQJO\
RWKHUZLVH SK\VLFDOO\ QRUPDO FKLOG :H VD\ VHHPLQJO\ EHFDXVH WKH ELRHWKLFV OLWHUDWXUH
FRQVWDQWO\VLPSOLILHVUHDOZRUOGFRPSOH[LWLHVWRSRVHPRUDODUJXPHQWVPRUHFOHDUO\,WLVYHU\
KDUGWRKDYHDVVD\V\VWHPVWKDWDQVZHUSUHFLVHO\ZKDWFHOOVDUHGRLQJ$VMXVWRQHH[DPSOH
WKH QRUPDO JURZWK JHQH PD\ EH ZRUNLQJ EXW VRPH RWKHU JHQH ZH NQRZ QRWKLQJ DERXW
PD\EHOLPLWLQJWKHSURWHLQ VHIIHFW 

7KH FRUUHFW DQVZHU PXVW EH WKDW LI LW LV SHUPLVVLEOH WR XVH WKHSURWHLQ ZKHQ WKH JHQH
PDNHVLWLQEDFWHULDLWLVSHUPLVVLEOHWRXVHWKHJHQHZKHQLWLVDGGHGWRDFHOOSDUWLFXODUO\
EHFDXVH FHOOXODU DGPLQLVWUDWLRQ RI WKH JHQH PD\ EH VDIHU $OO JHQH WKHUDS\ DGGV WR
HQKDQFHPHQW DV DQ HWKLFDO WRSLF LV WKH SRVVLELOLW\ WKDW LW PD\ H[SDQG WKH UDQJH RI
HQKDQFHPHQWV SRVVLEOH LI IRU H[DPSOH VRPH SURWHLQV UHTXLUH FRQWUROV RI GRVH
DGPLQLVWUDWLRQLQVHTXHQFHDQGVSHFLILFLW\DVWRVLWHRIDFWLRQWKDWFRXOGQRWEHREWDLQHGE\
DQ\RWKHUPDQQHURIDGPLQLVWUDWLRQ


ϯϬϳ

 (QKDQFHPHQWVDUHSUREOHPDWLFEXWXELTXLWRXVLQKXPDQVRFLHW\IURPWDWWRRVWRZRPHQ
DQG PHQ SLHUFLQJ WKHLU HDUV WR SHUPLW EHWWHU GLVSOD\ RI WKHLU HDUULQJV *XLWDULVWV PD\
LQWHQWLRQDOO\WHDUOLJDPHQWVWRSHUPLWWKHWKXPEWRFRYHUPRUHIUHWV&RVPHWLFVXUJHU\KDV
LWVXVHVDQGDEXVHV6RFLDOFRQWUROVDUHLPSRVHGZKHQHQKDQFHPHQWVPD\SRVHVHULRXVULVNV
WRKHDOWKDQGZKHQWKH\DUHWKRXJKWXQIDLUWRRWKHUVZKRDUHFRPSHWLQJLQDJDPHZKLFKLV
GHILQHGVRDVWRPDNHWKHLUXVHDQXQIDLUDGYDQWDJH7KHXVHRIVWHURLGGUXJVE\DWKOHWHVWR
EXLOGPXVFOHPDVVLVWKHFRPPRQH[DPSOH$QGRIFRXUVHIRUPDQ\RUPRVWVRFLHWLHVWKH
XVHRISXEOLFUHVRXUFHVIRUVXFKHQGVZRXOGEHWKRXJKWTXHVWLRQDEOHLQOLJKWRISULQFLSOHVRI
MXVWGLVWULEXWLRQ

7KHUHLVDFRQVLGHUDEOHOLWHUDWXUHRQWKHVHWRSLFVWKDWRIWHQJHWVSXVKHGWRWKHVLGHDVLI
VRPDWLFFHOOHQKDQFHPHQWZHUHDSUREOHPRIDGLIIHUHQWVRUW:HWKLQNQRW3DUWLFXODUXVHVRI
ELRFKHPLFDO PRGXODWRUV PXVW EH H[DPLQHG DJDLQVW WKRVH PRGHOV LI DQG ZKHQ WKH\ DUH
SURSRVHG


*HUP&HOO*HQH7KHUDS\

6SHUPDQGHJJFHOOVDUHGLIIHUHQW7KH\DUHWKHFHOOVZKLFKJRWRIRUPWKHLQGLYLGXDOVRI
WKHQH[WJHQHUDWLRQDQGSDVVWKHJHQHVIURPERWKSDUHQWVWRWKHRIIVSULQJ7KH\DUHWKH*HUP
&HOOV*HUP&HOO*HQH7KHUDS\ZRXOGLQYROYHWKHGHOLEHUDWHLQVHUWLRQRIDJHQHLQWRWKHJHUP
FHOOVGHOHWLRQRIDJHQHIURPWKHPRUDOWHUDWLRQRIDJHQHDOUHDG\WKHUH0RVWSHRSOHDJUHH
WKDWJHUPOLQHWKHUDS\UDLVHVVHULRXVHWKLFDOLVVXHVEHFDXVHFKDQJHVZRXOGEHLQKHULWHG


$SSOLFDWLRQWR*HUPOLQH*HQH,QWHUYHQWLRQ

*HUPOLQHJHQHLQWHUYHQWLRQ WKHWHUPZHXVHLQSUHIHUHQFHWRJHUPOLQHJHQHWKHUDS\DV
WKHUDS\ VXJJHVWV WKH JHUPOLQH LV VRPHKRZ LOO ZKLFK LV QRW WKH FDVH  KDV JUDEEHG WKH
ZRUOG VDWWHQWLRQ,PDJLQLQJDZRUOGLQZKLFKVRPHSHRSOHWKHVWDWHSK\VLFLDQVSDUHQWV
KDYHDXWKRULW\WRVHOHFWWKHJHQHWLFFKDUDFWHULVWLFVRIWKHQH[WJHQHUDWLRQFKRRVLQJFKHPLFDO
FRQVWLWXHQWVWRSURGXFHGHVLUHGWUDLWVDVLIWKH\ZHUHEDNLQJDFDNHSURYLGHVWKHFRQMXUHUZLWK
WKH RFFDVLRQ WR UHIOHFW RQ WKH WUXH QDWXUH RI LQGLYLGXDO ULJKWV DQG KXPDQ GLJQLW\ 2Q WKH
ZKROHWKLQNLQJDERXWXOWLPDWHYDOXHVLVDJRRGWKLQJ<HWVXFKIXWXUHVDUHRIWHQGHVFULEHGLQ
D ZD\ WKDW LJQRUHV WKH PRUDO YDOXHV WKDW LQKHUH LQ WKH FRPSOH[LW\ DQG FRQWLQJHQF\ RI
LQGLYLGXDOGHYHORSPHQW0R]DUW VJHQHVGRQRWJXDUDQWHH0R]DUW VWDOHQW

$OO PDMRU VWDWHPHQWV DERXW JHUPOLQH LQWHUYHQWLRQ FRQGHPQ LWV SUHVHQW XVH 7KDW
SRVLWLRQLVFOHDUO\FRUUHFW7KDWJHQHVFDQEHSXWLQWRDQLPDOJHUPOLQHVDQGPDGHWRH[SUHVV
GRHVQRWEHJLQWRDQVZHUVDIHW\LVVXHVIRUKXPDQXVH0RUHRYHUDUHWKHUHDQLPDOPRGHOVWKDW
FDQSUHGLFWWKHLPSDFWRQWKHKXPDQEUDLQ"(QRUPRXVWHFKQLFDOSUREOHPVZRXOGKDYHWREH
VROYHGWRPDNHWKHWHFKQRORJ\UHDOLVWLFLQOLJKW RIWKHULVNVSDUWLFXODUO\WKHFRQWURORIJHQH
H[SUHVVLRQWKURXJKRXWWKHRUJDQLVP VSURFHVVRIFHOOXODUGLIIHUHQWLDWLRQ0RUHRYHURQHPXVW
KDYHEDVLVIRUSUHGLFWLQJFRQILGHQWO\WKHFRQVHTXHQFHVRIQRYHORUDOWHUHGJHQHWLFPDWHULDOLQ
WKH ZRUNLQJV RI HDFK DQG HYHU\ FHOO W\SH 6R IDU DV ZH NQRZ WKHUH KDYH EHHQ QR HIIRUWV
DQ\ZKHUHLQWKHZRUOGWRDWWHPSWJHUPOLQHLQWHUYHQWLRQRQKXPDQEHLQJV


ϯϬϴ

 7KHSURKLELWLRQ RQJHUPOLQH WKHUDS\ LV D PDWWHURIIRUPDOOHJLVODWLRQLQVRPHQDWLRQV
HJ6ZHGHQ DQGLVDFFRPSOLVKHGWKURXJKUHJXODWRU\FRQWUROVLQPDQ\RWKHUVIRUH[DPSOH
8QLWHG.LQJGRPDQGWKH8QLWHG6WDWHV3UHVHQWSURKLELWLRQGRHVQRWGHQ\WKHSRVVLELOLW\RI
IXWXUH XVH <HW WKHUH DUH LPSRUWDQW (XURSHDQ GRFXPHQWV WKDW FRQGHPQ JHUPOLQH WKHUDS\
XQHTXLYRFDOO\ )RU H[DPSOH 5HFRPPHQGDWLRQ  RI WKH &RXQFLO RI (XURSH VWDWHV ³$Q\
IRUP RI WKHUDS\ RQ WKH KXPDQ JHUPLQDO OLQH VKDOO EH IRUELGGHQ´ 7ZR LPSRUWDQW UHFHQW
UHSRUWVWKH&ORWKLHU&RPPLVVLRQ  DQGWKH'HFODUDWLRQRI,QX\DPD  KRZHYHUGR
QRWFDWHJRULFDOO\UXOHRXWJHUPOLQHLQWHUYHQWLRQV,QWKH8QLWHG6WDWHVDQXPEHURISURPLQHQW
FRPPHQWDWRUV EHOLHYH WKDW GLVFXVVLRQ VKRXOG EHJLQ DERXW GHYHORSLQJ LQWHUYHQWLRQV IRU WKH
JHUPOLQH $QGHUVRQDQG)OHWFKHU:LYHODQG:DOWHUV 7KHLUFDOOIRUSUHVHQWGLVFXVVLRQ
UHIOHFWV QR GLVDJUHHPHQW DERXW LWV SUHVHQW HWKLFDO LPSHUPLVVLELOLW\ ,W UHFRJQL]HV WKDW WKH
IXWXUHSROLF\SURFHVVIRUDSSURYDOZLOOWDNHDORQJWLPHDQGWKDWPRUHGLVFXVVLRQQRZZLOO
PDNH LW PRUH OLNHO\ WKDW DSSURSULDWH SROLF\ ZLOO EH LQ SODFH LQ WKH IXWXUH ZKHQ WHFKQLFDO
FDSDELOLWLHVDUHDWKDQG,WPD\EHULJKWWRGHEDWHWKHXOWLPDWHYDOXHTXHVWLRQV%XWWKRVHZKR
VXJJHVW WKH GHVLUDELOLW\ RI JHUPOLQH WKHUDS\ KDYH QRW WKH 5DSSRUWHXUV EHOLHYH PDGH D
SODXVLEOH FDVH IRU DQ\ QHDU WHUP VXEVWDQWLDO XVH IRU LW DQG FHUWDLQO\ QR FDVH WKDW WKH JDLQV
ZRXOGEHZRUWKWKHH[WUDRUGLQDU\HIIRUWVUHTXLUHG

*HQHWLF LQWHUYHQWLRQ LQ WKH JHUPOLQH VRXQGV PRVW DWWUDFWLYH DV D WHFKQRORJ\ IRU
SHUPLWWLQJDFRXSOHRULQGLYLGXDOWRVSDUHWKHLUGHVFHQGDQWVWKHEXUGHQRIJHQHWLFGLVHDVH6R
IRU H[DPSOH D SHUVRQ DW ULVN IRU D GLVHDVH FDXVHG E\ D GRPLQDQW JHQH PLJKW VHHN WKH
SURFHGXUHWRJXDUDQWHHWKDWKLVIXWXUHFKLOGUHQZRXOGEHIUHHRILW,ILWLVPRUDODVLWVXUHO\
ZRXOGEHWRUHPHG\KLVFRQGLWLRQE\VRPDWLFFHOOJHQHWKHUDS\ZK\QRWFXUHLWRQFHDQGIRU
DOOE\JHUPOLQHWHFKQLTXHV"%HIRUHFRQVLGHULQJWKHPRUDOGLOHPPDVLQKHUHQWLQWKDWTXHVWLRQ
DVNZKHWKHULWLVHWKLFDOWRULVNKDUPLIWKHUHLVDVDIHUDOWHUQDWLYH,IRQHKDGWKHNQRZOHGJH
VXIILFLHQW WR DWWHPSW D JHUPOLQH LQWHUYHQWLRQ LQ WKHVH VHWWLQJV LW VHHPV FHUWDLQ RQH ZRXOG
NQRZKRZWRDFFRPSOLVKWKHVDPHHQGZLWKRXWHPSOR\LQJJHUPOLQHWHFKQLTXHV

7UHDWLQJWKHDGXOW VFHOOVLQYLYRWRUHPRYHWKHJHQHLVDWHFKQRORJ\QRWHYHQHQYLVDJHG
%\FRQWUDVWVRUWLQJVSHUP RUHJJV XVLQJ'1$SUREHVWRVHSDUDWHWKRVHWKDWFDUU\WKHJHQH
IURP WKRVHWKDW GR QRW IDOOV LQWR WKH FDWHJRU\ RI QRW SUHVHQWO\ IHDVLEOH,I LWFRXOG EHGRQH
KRZHYHU RQH FRXOG VROYH WKH SUREOHP E\ XVLQJ JRRG VSHUP DQG GLVFDUGLQJ UDWKHU WKDQ
UHSDLULQJ VSHUP WKDW FDUULHG WKH JHQH 6LPLODUO\ UHVHDUFK  SXEOLVKHG DIWHU WKLV SDSHU ZDV
SUHSDUHGDQGGLVFXVVHGE\WKH,%&VXJJHVWVWKHSRVVLELOLW\RILGHQWLI\LQJVSHUPVWHPFHOOV
DQG SHUKDSV DOWHULQJ WKHP H[ YLYR DQG UHVWRULQJ WKRVH JURZQ IURP FHOOV WKDW ZHUH
VXFFHVVIXOO\UHSDLUHG 

7KHSUREDEOHVWDUWLQJSRLQWIRUJHUPOLQHLQWHUYHQWLRQKRZHYHULVWKHKXPDQ]\JRWHDW
WKHIRXUFHOOVWDJHIHUWLOL]HGWKURXJKLQYLWURIHUWLOL]DWLRQ&HUWDLQO\WKDWLVWKHRQO\SUHVHQW
ZD\WRGRLW$QLPDOPRGHOVVXJJHVWWKDWJHQHLQVHUWLRQWKDWZLOOGLIIHUHQWLDWHLQWRHYHU\FHOO
LVIHDVLEOH%XWLIDSDUWLFXODU]\JRWHFDQEHLGHQWLILHGDVFDUU\LQJ RUODFNLQJ WKHJHQHDQG
WKHUHIRUH EH DSSURSULDWH IRU WUHDWPHQW ZK\ ZRXOG RQH WU\ WKH H[WUDRUGLQDU\ SURFHGXUH RI
UHSDLU UDWKHU WKDQ VHOHFWLQJ IRU LPSODQWDWLRQ D ]\JRWH WKDW GLG QRW KDYH WKH JHQH" 6XFK
VFUHHQLQJ SURFHGXUHV DUH LQ XVH RQ DQ H[SHULPHQWDO EDVLV LQ D IHZ KRVSLWDOV DURXQG WKH
ZRUOG )RU H[DPSOH DW D KRVSLWDO LQ ,VUDHO SURFHGXUHV IRU VHOHFWLYH VFUHHQLQJ RI ]\JRWHV

ϯϬϵ

XVLQJ VRFDOOHG 3&5 WHFKQLTXH WR WHVW WKH '1$ LQ RQH FHOO RI WKH IRXUFHOOV ZDV XVHG WR
VFUHHQIRUF\VWLFILEURVLV

7KHUH DUH PDQ\ ZKR VWURQJO\ RSSRVH DQ\ VHOHFWLRQ RU GLVFDUGLQJ RI ]\JRWHV DQG IRU
WKHVHSHUVRQVWKDWRSSRVLWLRQLVLWVHOIDVXIILFLHQWEDVLVWRSURWHVWWKHGHYHORSPHQWRIJHUPOLQH
LQWHUYHQWLRQV 2SSRVLWLRQ WR VHOHFWLQJ ]\JRWHV JRHV KDQGLQKDQG ZLWK RSSRVLWLRQ WR QRQ
WKHUDSHXWLFH[SHULPHQWVRQ]\JRWHVWKDWZLOOQHYHUEHLPSODQWHG)RUH[DPSOH*HUPDQODZ
SURKLELWV QRQWKHUDSHXWLF H[SHULPHQWV RQ WKH KXPDQ ]\JRWH :KLOH DOO DFNQRZOHGJH WKH
VSHFLDO UHVSHFW RZHG WR WKH IHUWLOL]HG HJJ WKURXJKRXW LWV GHYHORSPHQW ZKDW DFWLRQV DUH
UHTXLUHG RU SURKLELWHG E\ WKDW UHVSHFW LV DQ LVVXH RQ ZKLFK WKH ZRUOG FRPPXQLW\ LV GHHSO\
GLYLGHG 7KLV 5HSRUW GRHV QRW DWWHPSW DUJXPHQW RQ WKH LVVXH 2EYLRXVO\ LW LV FUXFLDO IRU
JHUPOLQHLQWHUYHQWLRQV1RKXPDQJHUPOLQHLQWHUYHQWLRQVFDQEHVDIHO\GHYHORSHGZHWKLQN
ZLWKRXWWKHRSSRUWXQLW\WRWHVWZKHWKHUJHQHVLQVHUWHGVRPHZKHUH VSHUPHJJ]\JRWH LQIDFW
DUHUHSOLFDWHGDSSURSULDWHO\LQWKHILUVWVWDJHVRIFHOOXODUGLIIHUHQWLDWLRQ

7KH ODUJHVW SODXVLEOH QHHG IRU JHUPOLQH LQWHUYHQWLRQ LV WR WUHDW DIIHFWHG ]\JRWHV RQFH
DQGIRUDOORQEHKDOIRISHUVRQVZKRGLVDSSURYHRIDERUWLRQRUVHOHFWLYHLPSODQWDWLRQ,IVDIH
LQWHUYHQWLRQV ZHUH GHYHORSHG RYHU WKHLU SURWHVW WKHVH SHUVRQV PLJKW ZLVK WR KDYH WKH
SURFHGXUH GRQH LQ SUHIHUHQFH WR VHOHFWLYH DERUWLRQ RU LPSODQWDWLRQ ZKLFK WKH\ EHOLHYH LV
LPPRUDO:HZRXOGWKLQNKRZHYHUWKDWGHYHORSLQJDWHFKQRORJ\WRVHUYHSULQFLSDOO\WKRVH
ZKRGLVDSSURYHLWVGHYHORSPHQWRQWKHGHHSHVWPRUDOJURXQGVLVDSXEOLFSROLF\RSWLRQZLWK
OLPLWHG DSSHDO 7KHUH PD\ EH RWKHU QHHGV 7KHUH PD\ EH FRXSOHV ZKHUH HDFK SDUWQHU LV
KRPR]\JRXVIRUDSDUWLFXODUUHFHVVLYHJHQHVD\WKHF\VWLFILEURVLVJHQH)RUWKLVFRXSOHQR
QRUPDOFKLOGUHQDUHSRVVLEOHEHFDXVHQRFRS\RIWKHJHQHLVSUHVHQWLQWKH'1$RIHLWKHU
7KHUHPD\EHVXFKFRXSOHVEXWWKHSURVSHFWRIODXQFKLQJDWHFKQRORJLFDOHQWHUSULVHVRYDVWWR
VHUYH WKHP VHHPV WRR LPSODXVLEOH WR MXVWLI\ UHOD[DWLRQ RI WKH SURKLELWLRQ RQ GHYHORSLQJ
JHUPOLQH LQWHUYHQWLRQ 7KHUH PD\ SHUKDSV EH RWKHU FRQGLWLRQV ZKHUH WKH DOWHUQDWLYH LV QRW
IHDVLEOHEXWDJDLQVRIDUDVZHDUHDZDUHWKH\DUHYHU\UDUH,IZHFRUUHFWO\XQGHUVWDQGWKH
OLPLWHGSODXVLEOHXVHVWKHQHHGWRLQLWLDWHSROLF\UHYLVLRQQRZIRUODWHUVHHPVODFNLQJ

7KDW VDLG WKH XQFHUWDLQWLHV ERWK RI VFLHQWLILF NQRZOHGJH DQG WKH SDFH RI WHFKQLFDO
LPSURYHPHQWFDXWLRQVDJDLQVWVD\LQJQHYHUXQOHVVWKHUHLVVRPHLPSRUWDQWPRUDOYDOXHWR
EHVHUYHG)RUH[DPSOHLILWZHUHGLVFRYHUHGWKDWVRPHQHZYLUXVHQWHUHGEUDLQFHOOVHDUO\
DQGSURGXFHGGHPHQWLDDIWHUD ODWHQF\ SHULRG LV LW LQFRQFHLYDEOHWKDWJHUPOLQHLQWHUYHQWLRQ
PLJKWEHWKHEHVW DQGRQO\ ZD\RISURWHFWLQJKXPDQVIURPLW"1HZYLUXVHVDUHREYLRXVO\
SRVVLEOH:KRNQHZWKDW UHWURYLUXVHVHYHQH[LVWHGIRUW\ \HDUVDJR" 7KHUHIRUHDOWKRXJK ZH
DUHQRWFRQYLQFHGWKDWWKHSROLF\SURFHVVQHHGVWRPRYHIRUZDUGQRZLWVHHPVDSSURSULDWHWR
FRQVLGHUZKHWKHUWKHUHDUHVRXQGUHDVRQVIRUFDWHJRULFDOO\EDUULQJJHUPOLQHLQWHUYHQWLRQV'R
FRQFHSWV RI KXPDQ GLJQLW\ DQG UHVSHFW IRU KXPDQ OLIH UHTXLUH FDWHJRULFDO FRQGHPQDWLRQ RI
JHUPOLQHLQWHUYHQWLRQ"
3URWHFWLRQ RI KXPDQ GLJQLW\ DQG ZRUWK SXWV LPSRUWDQW OLPLWV RQ WDPSHULQJ ZLWK WKH
UHVHUYRLU RI SRWHQWLDOLWLHV LQKHUHQW LQ WKH JHQH SRRO %XW DUH FDWHJRULFDO SURKLELWLRQV
GHVLUDEOH"7KH\PLJKWEHEDVHGRQ
WKHQHHGWRH[SHULPHQWRQ]\JRWHV:HZLOOQRWFRPPHQWIXUWKHURQWKLVLVVXH
LPSHUPLVVLEOHULVNVWRWKHIXWXUHFKLOG

ϯϭϬ

 7KHUHLVPXFKPHULWLQWKLVYLHZ$Q\H[SHULPHQWVZLOOQHFHVVDULO\UHTXLUHLQIHUHQFHV
IURP DQLPDO PRGHOV EXW ZKDW NLQG RI DQLPDO PRGHO FDQDGHTXDWHO\ LQGLFDWH WKH HIIHFWV RI
DOWHULQJHYHU\VLQJOHFHOOLQWKHERG\DQGZKDWHIIHFWWKRVHDOWHUDWLRQVPD\KDYHRQXQLTXHO\
KXPDQTXDOLWLHVVXFKDVFRJQLWLRQ"2QHPLJKWVD\FDWHJRULFDOO\WKDWWKHULVNVZLOODOZD\VEH
WRR JUHDW WR MXVWLI\ LQWHUYHQWLRQ DQG FHUWDLQO\ VR DJDLQVW FRQGLWLRQV WKDW KDYH ORQJ EHHQ
WKRXJKW SDUW RI WKH KXPDQ FRQGLWLRQ VXFK DV PHPRU\ ORVV ZLWK DJH $IWHU DOO WKHUH LV QR
SUHVHQWSDWLHQWZKRLVVLFNDQGLQQHHGRIWUHDWPHQWZKRVHEHQHILWLVWREHZHLJKHGDJDLQVW
ULVN
7KH SKLORVRSKLFDO TXHVWLRQ RI ZKHWKHU RU QRW IXWXUH SHUVRQV KDYH D ULJKW QRW WR EH
H[SHULPHQWHGZLWKEHIRUHWKH\DUHSHUVRQVZLWKLQWHUHVWVRIWKHLURZQLVDGHHSO\LQWHUHVWLQJ
SKLORVRSKLFDORQH6RWRRZKHWKHUWKHLUK\SRWKHVL]HGLQWHUHVWLQGLVHDVHIUHHH[LVWHQFHFDQEH
ZHLJKHG LQ WKH EDODQFH DJDLQVW WKH ULVNV :KHWKHU RU QRW WKH ODQJXDJH RI ULJKWV LV
DSSURSULDWHKRZHYHUFRPPRQODQJXDJHUHJDUGVSHRSOHDVZURQJHGZKHQWKH\DUHLQMXUHG
E\DFWLYLWLHVWKDWRFFXUUHGEHIRUHWKHLUFRQFHSWLRQUHJDUGOHVVRIZKHWKHURUQRWWKH\KDYHWKH
ULJKW WR PDLQWDLQ D ODZVXLW :H WKLQN IRU H[DPSOH RI SUHFRQFHSWLRQ H[SRVXUH WR WR[LF
VXEVWDQFHV,IRQHFDQWKLQNRIWKHLQWHUHVWVRIIXWXUHSHUVRQVWKLVZD\WKHQWKHSUHVXPSWLYH
OHJLWLPDF\ RI SDUHQWDO FRQVHQW WR VSHDN RQ WKHLU EHKDOI LV FRQVLVWHQW ZLWK WKH UHVW RI RXU
LQVWLWXWLRQDODUUDQJHPHQWV

7KH LVVXH WKHQ LV ZKHWKHU WKHUH DUH QRW GLVDELOLWLHV VR VHYHUH WKDW RQH PD\ LPSXWH WR
SDUHQWVWKHULJKWWRVSHDNIRUWKHLUGHVFHQGDQWVDQGOHJLWLPDWHULVNWDNLQJRQWKHLUEHKDOI:H
WKLQN WKHUH DUH 0RUHRYHU ZH WKLQN WKDW WR LQYRNH D FKLOG V ULJKW WR DQ XQDOWHUHG JHQHWLF
PDNHXSVRDVWRYLVLWRQKLPFRQGLWLRQVLQFRPSDWLEOHZLWKSURORQJHGOLIHLVWRRSDUDGR[LFDO
WREHDFFHSWHG
7KHWKLUGREMHFWLRQWRJHUPOLQHLQWHUYHQWLRQVLVWKDWPLVWDNHVFDQQRWEHUHFDOOHG,IIRU
H[DPSOHLQWDPSHULQJ ZLWKWKHRUJDQLVP VJHQHVVFLHQWLVWV VRPHKRZ ODXQFKD QHZ JHQHWLF
SUREOHPRQWKHZRUOGWKHJHQHWKH\FUHDWHPD\VSUHDGLWVZD\WKURXJKRXWWKHSRSXODWLRQ,Q
HIIHFW DGGLQJ D QHZ JHQH WR WKLV ]\JRWH LV UHVHDUFK WR ZKLFK , D WKLUG SDUW\ KDYH QRW
FRQVHQWHG RQ EHKDOI RI P\ IXWXUH FKLOGUHQ ZKR PD\ EH DIIHFWHG E\ DQ DFFLGHQW 6XFK
WKHRUHWLFDOORJLFDVWKLVSRVLWLRQPD\KDYHKRZHYHULJQRUHVWKHIOX[RIWKHKXPDQJHQHSRRO
WUHDWLQJLWDVDZRUNRIDUWUDWKHUWKDQDQRQJRLQJSURFHVV:HGRQRWWKLQNWKHSHUVRQZKRLV
H[SRVHGWRUDGLDWLRQLVUXQQLQJ ULVNVIRUZKLFKKHQHHGV RXU FRQVHQW RQWKH WKHRU\ WKDW KH
PLJKW EH EXUGHQLQJ RXU FRPPRQ GHVFHQGDQWV :KDW PDNHV JHUPOLQH LQWHUYHQWLRQ
SUREOHPDWLFLVWKHLQWHQWLRQDOFKDUDFWHURIWKHHQWHUSULVH

$ ILQDO DUJXPHQW DJDLQVW JHUPOLQH LQWHUYHQWLRQ LV WKDW LW LV VRPHKRZ EH\RQG KXPDQ
ULJKW WR LQWHUIHUH ZLWK WKH IXQGDPHQWDO SURFHVV RI OLIH DQG WKDW WKLV SURKLELWLRQ FDQQRW EH
RYHUFRPH E\ WKH KLJKO\ DPELJXRXV QRWLRQ RI GLVHDVHG JHQHV 7R EH FUHGLWDEOH WKLV
DUJXPHQWPXVWVD\ZK\LQWHQWLRQDOLQWHUIHUHQFHZLWKWKHJHUPOLQHSRVHVPRUDOLVVXHVVKDUSO\
GLIIHUHQWIURPWKHXQSODQQHGEXWQRQHWKHOHVVVLJQLILFDQWLPSDFWRIKXPDQDFWLYLWLHVRQLW,W
PXVWDOVRLQVLVWRQVXFKDGLVWLQFWLRQLQWKHIDFHRIWKHFKLOG VVXIIHULQJLOOVWKDWE\K\SRWKHVLV
PLJKWKDYHEHHQVDIHO\SUHYHQWHG

*HUPOLQH(QKDQFHPHQW

7KHSURVSHFWRIXVLQJJHUPOLQHLQWHUYHQWLRQVWRLPSURYHWKHEDVLFWUDLWVRIKXPDQLW\LV
HYHU\ZKHUH FRQGHPQHG :H EHOLHYH LW LPSHUPLVVLEOH DOVR IRU VWDQGDUG UHDVRQV  )LUVW ZH
FDQQRW K\SRWKHVL]H KRZ LVVXHV RI ULVN YHUVXV EHQHILW FRXOG SRVVLEO\ EH ZHLJKHG WR IDYRU

ϯϭϭ

SURFHHGLQJ 7KH SODXVLEOH XVHV RI JHUPOLQH LQWHUYHQWLRQ HYHQ FRXSOHG ZLWK H[WHQVLYH
H[SHULHQFH ZLWK VRPDWLF FHOO WKHUDS\ ZRXOG QRW JURXQG H[SHULHQFH WKDW WKLV NLQG RI
LQWHUYHQWLRQFDQEHVDIHO\ GRQH 7KHUHFDQ EHQRVXLFLGH JHQHVKHUH7KHUHIRUHDOWKRXJK
ZHFDQLPDJLQHVRPHVRPDWLFFHOOHQKDQFHPHQWVWKDWPLJKWQRWEHZURQJLWZRXOGEHMXVWDV
ZURQJWRIRUFHWKHPRQRXUFKLOGUHQ VFKLOGUHQDVLWZRXOGEHWRIRUFLEO\PHGLFDWHDQDGXOW
ZLWKDGUXJ6HFRQGO\KXPDQLQGLYLGXDOLW\DQGFRPPXQLW\LVOLQNHGWRWKHFODLPWKDW\RXDUH
ZKR \RXDUH WKH SURGXFWOLNHDOO RI XV RI FKDQFH ,W LV ZURQJWR EXUGHQ LQGLYLGXDOV ZLWK D
SURJUDPPHGGHVWLQ\DQG PDNH WKHP YLFWLPVRI JHQHWLF H[SHFWDWLRQ)LQDOO\ IRURQHVHWRI
KXPDQVWRFODLPWRIRUHVHHZKDWWUDLWVWKHZRUOGZLOOQHHGLQWKHGLVWDQWIXWXUHLVZURQJ


$GPLQLVWHULQJJHQHWKHUDS\

6XFFHVVIXOJHQHWKHUDS\UHTXLUHVWKDWWKH
‡JHQHWLFPDOIXQFWLRQQDWXUHRIDGLVHDVHLVXQGHUVWRRG
‡WKHUDSHXWLFPDWHULDOFDQEHGHOLYHUHGWRWKHWDUJHWFHOOVLQWKHDIIHFWHGWLVVXHRURUJDQ
‡WKHUDSHXWLFPDWHULDOLVDFWLYHIRUWKHLQWHQGHGGXUDWLRQDQGGHOLYHUVWKHLQWHQGHGEHQHILWWR
WKHWDUJHWFHOOV
‡KDUPIXOVLGHHIIHFWVLIDQ\DUHPDQDJHDEOH

7KHUDSHXWLFPDWHULDOFDQEHGHOLYHUHGWRWKHWDUJHWFHOOVLQWZRPDLQZD\V)LUVWLWFDQ
EHLQVHUWHGLQWRFHOOVIURPWKHDIIHFWHGWLVVXHRXWVLGHWKHERG\DQGWKHVHFHOOVWKHQUHWXUQHG
WRWKHERG\6HFRQGLWFDQEHGHOLYHUHGGLUHFWO\LQWRWKHERG\DWWKHUHTXLUHGVLWH(LWKHUZD\
D µGHOLYHU\ YHKLFOH¶ FDOOHG D YHFWRU LV XVHG WR JHW WKH WKHUDSHXWLF PDWHULDO WR WKH SDWLHQW V
WDUJHWFHOOV9HFWRUVDUHPRVWFRPPRQO\EDVHGRQPRGLILHGYLUXVHVEHFDXVHWKHVHFDQWDUJHW
DQGHQWHUFHOOVHIILFLHQWO\7RGDWHVRPHRIJHQHWKHUDS\WULDOVDSSURYHGKDYHLQYROYHG
YLUDOYHFWRUV

&OLQLFDOWULDOV

1LQHW\VL[WULDOVLQYROYLQJSDWLHQWVKDYHEHHQDSSURYHGLQWKH8.VLQFH2IWKHVH
 ZHUH IRU FDQFHU  IRU VLQJOHJHQH GLVRUGHUV DQG  IRU YDVFXODU GLVHDVH 7KH
PDMRULW\ZHUHµ3KDVH,¶FOLQLFDOWULDOVWRHYDOXDWHWKHVDIHW\RIDSURSRVHGJHQHWKHUDS\ZLWK
VPDOOQXPEHUVRIYHU\LOOSDWLHQWVIRUZKRPQRRWKHUWUHDWPHQWRSWLRQVH[LVWHG)RULQVWDQFH
VRPHHDUO\&)WULDOVKDGSDWLHQWV,I3KDVH,LVVXFFHVVIXODWULDOPD\EHUHSHDWHGZLWK
DODUJHUJURXSRISDWLHQWVLQ3KDVH,,WRDVVHVVWKHUDSHXWLFDFWLYLW\LQYHU\LOOSDWLHQWV(YHQDW
WKLV VWDJH D VXFFHVVIXO RXWFRPH FDQQRW EH DWWULEXWHG VROHO\ WR WKH HIILFDF\ RI WKH JHQH
WKHUDS\(IILFDF\FDQRQO\EHHVWDEOLVKHGLQD3KDVH,,,FOLQLFDOWULDOLQYROYLQJPRUH SHUKDSV
XSWRDIHZKXQGUHG SDWLHQWV7RGDWHWKUHH8.JHQHWKHUDS\WULDOV±RQHIRU+,9DQGWZR
IRUJOLRPD DW\SHRIEUDLQFDQFHU ±KDYHSURJUHVVHGWR3KDVH,,,

0DUNHWLQJDSSURYDO

1RIRUPRIJHQHWKHUDS\KDV\HWDGYDQFHGWREHFRPHDOLFHQVHGWUHDWPHQWLQWKH8.
$Q\FRPPHUFLDOPDUNHWLQJRIDJHQHWKHUDS\SURGXFWZRXOGUHTXLUHDPDUNHWLQJOLFHQFHIURP
WKH (XURSHDQ 0HGLFLQHV $JHQF\ (0($  $V D KXPDQ PHGLFLQDO SURGXFW RI ELRORJLFDO
RULJLQ JHQH WKHUDS\ PHGLFLQDO SURGXFWV IRU PDUNHWLQJ LQ RQH RU PRUH RI WKH (8 PHPEHU
VWDWHVPXVWUHFHLYHDSSURYDOYLDWKH(0($¶VFHQWUDOLVHGPDUNHWLQJSURFHGXUH7KLVLVDZHOO
HVWDEOLVKHG SURFHGXUH IRU ELRORJLFDO WKHUDSHXWLF SURGXFWV VXFK DV UHFRPELQDQW WKHUDSHXWLF
SURWHLQV 7R DVVHVV HDFK DSSOLFDWLRQ IRU PDUNHWLQJ DXWKRULVDWLRQ WKH (0($ DSSRLQWV D
ϯϭϮ

UDSSRUWHXUDQGDFRUDSSRUWHXUIURPWZRPHPEHUVWDWHV7KHDSSOLFDWLRQLVWKHQDVVHVVHGRQ
WKHEDVLVRITXDOLW\VDIHW\DQGHIILFDF\RIWKHSURGXFW

,VVXHV
*HQHWKHUDS\LV RQO\XVHGWRWUHDWYHU\VHULRXV GLVHDVHV:KLOH WKH ILUVW FOLQLFDO WULDOV
IRFXVHGPDLQO\RQVLQJOHJHQHGLVRUGHUVPRUHUHFHQWWULDOVKDYHORRNHGDWFRPSOH[GLVHDVHV
VXFK DV FDQFHU 6XFK WULDOV RIIHU KRSH IRU FDQFHU SDWLHQWV EXW DUH DW DQ HDUO\ VWDJH 7KH
H[SHULHQFH RI  \HDUV DQG QHDUO\ D KXQGUHG 8. WULDOV LQ JHQH WKHUDS\ KDV SURGXFHG
VLJQLILFDQW VXFFHVVHV %XW LW KDV DOVR KLJKOLJKWHG TXHVWLRQV DERXW HIIHFWLYHQHVV VDIHW\
GXUDELOLW\DQGWKHOLNHO\FRPPHUFLDOLVDWLRQRIJHQHWKHUDS\7KHVHDUHGLVFXVVHGEHORZ

7HFKQLFDOFRQVLGHUDWLRQV
*HQHGHOLYHU\

6XFFHVVIXOJHQHGHOLYHU\LVQRWHDV\RUSUHGLFWDEOHHYHQIRUVLQJOHJHQHGLVRUGHUV)RU
H[DPSOH DOWKRXJK WKH JHQHWLF EDVLV RI &) LV ZHOO NQRZQ WKH SUHVHQFH RI PXFXV LQ OXQJV
PDNHV LW SK\VLFDOO\ GLIILFXOW WR GHOLYHU JHQHV WR WKH WDUJHW OXQJ FHOOV 'HOLYHULQJ JHQHV IRU
FDQFHU WKHUDS\ PD\ DOVR EH FRPSOLFDWHG ZKHUH WKH GLVHDVH PD\ EH LQ VHYHUDO VLWHV *HQH
WKHUDS\ WULDOV IRU ;FKURPRVRPHOLQNHG VHYHUH FRPELQHG LPPXQRGHILFLHQF\ ;6&,' 
KRZHYHU KDYH EHHQ PRUH VXFFHVVIXO ,Q WKLV FDVH WKH JHQHWLF EDVLV RI WKH GLVHDVH LV ZHOO
XQGHUVWRRGDQGWKHWKHUDSHXWLFPDWHULDOFDQEHGHOLYHUHGXVLQJWKHHVWDEOLVKHGSURFHGXUHRI
ERQHPDUURZWUDQVSODQW$YLUDOYHFWRUKDVEHHQXVHGWRLQWURGXFHIXQFWLRQLQJFRSLHVRIWKH
JHQHZKRVHPDOIXQFWLRQ FDXVHV ;6&,' LQWR EORRG SURGXFLQJVWHPFHOOVIURPWKHSDWLHQW¶V
ERQHPDUURZ7KHVHDUHWKHQWUDQVSODQWHGEDFNLQWRWKHSDWLHQW,QPRVWFDVHVWKHPRGLILHG
ERQHPDUURZVXFFHVVIXOO\VXSSOLHGWKHPLVVLQJJHQHSURGXFWDQGWKHSDWLHQWVDUHDEOHWROHDG
QRUPDOOLYHV

'XUDELOLW\DQGLQWHJUDWLRQ

6RPHJHQHWKHUDS\DSSURDFKHVDLPWRDFKLHYHDORQJWHUPHIIHFW:KHUHVXFKGXUDELOLW\
LVUHTXLUHGWKHWKHUDSHXWLFPDWHULDOPXVWUHPDLQIXQFWLRQDOIRUWKHLQWHQGHGGXUDWLRQRUJHQH
WKHUDS\PD\QRWDFKLHYHORQJWHUPEHQHILWV7ZRSRVVLEOHZD\VRIDFKLHYLQJWKLVDUHWRXVH
PXOWLSOHURXQGVRIJHQHWKHUDS\ RUWRLQWHJUDWHWKHUDSHXWLFJHQHVVRWKH\UHPDLQDFWLYHIRU
VRPH WLPH ,QWHJUDWLQJ WKHUDSHXWLF '1$ LQWR WKH WDUJHW FHOOV¶ JHQHWLF PDWHULDO ZKLOH ORQJ
ODVWLQJUDLVHVFRQFHUQVRYHUSRVVLEOHXQGHVLUDEOHVLGHHIIHFWV)RULQVWDQFHWKLVDSSURDFKKDV
EHHQXVHGLQWULDOVWRWUHDWEDELHVZLWK;6&,'V\QGURPH

,Q8.WULDOVEDELHVUHVSRQGHGZHOOWRJHQHWKHUDS\DQGUHPDLQKHDOWK\+RZHYHU
RI WKRVH LQ D VLPLODU)UHQFK WULDO ZHQW RQ WR GHYHORS OHXNDHPLDOLNH V\PSWRPV$ SRVVLEOH
H[SODQDWLRQ LV WKDW WKH WKHUDSHXWLF PDWHULDO PLJKW KDYH LQWHJUDWHG ZKHUH LW FRXOG DIIHFW
DQRWKHUJHQHWRSURGXFHUDSLG JURZWKRIFDQFHURXVFHOOV5HVHDUFKHUVDUHWKXVLQYHVWLJDWLQJ
ZD\V RI DFKLHYLQJ ORQJWHUP WKHUDSHXWLF HIIHFWV ZLWKRXW LQWHJUDWLRQ IRU LQVWDQFH E\ XVLQJ
VWDEOHQRQLQWHJUDWLQJYHFWRUV

2WKHUDSSURDFKHVVHHNPRUHLPPHGLDWHHIIHFWVZKHUHLQWHJUDWLRQRIWKHUDSHXWLF'1$
LQWRWKHWDUJHWFHOOVLVQRWWKHDLP)RULQVWDQFHLQJHQHWKHUDS\WRWUHDWFDQFHUWKHDLPPD\
EHWRXVHµVXLFLGH¶JHQHVWRNLOOFDQFHURXVFHOOVDVTXLFNO\DVSRVVLEOH

,PPXQHUHVSRQVH

ϯϭϯ

 :KHQ D YLUDO YHFWRU LV XVHG WR GHOLYHU JHQH WKHUDS\ WKH ERG\ PD\ UHFRJQLVH LW DV
µIRUHLJQ¶DQGPRELOLVHWKHLPPXQHV\VWHPWRDWWDFNLW,QFDQFHUWULJJHULQJVXFKDQLPPXQH
UHVSRQVHPD\EHWKHDLPRIWKHJHQHWKHUDS\,QRWKHUFDVHVLPPXQHUHVSRQVHVPD\UHGXFH
WKHHIILFDF\RIJHQHWKHUDS\FDXVLQJWKHSDWLHQWWRVWRSUHVSRQGLQJDIWHUDIHZDSSOLFDWLRQVRU
LQGXFLQJ VHULRXV VLGHHIIHFWV )XUWKHU DQ HQKDQFHG UHVSRQVH WR YHFWRUV HQFRXQWHUHG
SUHYLRXVO\PD\PDNHLWGLIILFXOWWRJLYHUHSHDWDSSOLFDWLRQVRIJHQHWKHUDS\

6DIHW\RIYHFWRUV

:RUOGZLGH PRUH WKDQ  SDWLHQWV ZLWK VHULRXV GLVHDVHV KDYH EHHQ WUHDWHG XVLQJ
H[SHULPHQWDOJHQHWKHUDSLHVVLQFH7RGDWHWKHUHKDYHEHHQMXVWWZRIDWDOLWLHVWKDWKDYH
EHHQ GLUHFWO\ DWWULEXWDEOH WR VXFK WUHDWPHQWV 1HYHUWKHOHVV D VPDOO PLQRULW\ RI FDVHV KDYH
UDLVHGSRWHQWLDOFRQFHUQV)RULQVWDQFHWKHXVHRIYLUDOYHFWRUVKDVEHHQVXJJHVWHGDVDIDFWRU
LQWKHGHDWKRID86JHQHWKHUDS\SDWLHQWDQGWKHFDVHVRIOHXNDHPLDOLNHV\PSWRPVDIWHU;
6&,'JHQHWKHUDS\WULDOVLQ)UDQFH

$QLPDO UHVHDUFK PD\ DOVR SURYLGH LPSRUWDQW LQIRUPDWLRQ RQ YHFWRU VDIHW\ )ROORZLQJ
UHFHQW UHSRUWV RIDSUHFOLQLFDO VWXG\ ZKHUHPLFHGHYHORSHG OLYHU WXPRXUV DIWHUH[SRVXUH WR
RQH SDUWLFXODU YHFWRU *7$& SXEOLVKHG DQ RSHQ OHWWHU GUDZLQJ DWWHQWLRQ WR SRWHQWLDO VDIHW\
FRQFHUQV)XUWKHUWKH8.+HDOWKDQG6DIHW\([HFXWLYHLVVXHGLQIRUPDWLRQDQGLQWHULPDGYLFH
RQFRQWDLQPHQW7KHVHVWHSVZHUHWDNHQLQFDVHWKHVHREVHUYDWLRQVDIIHFWHGDQ\SUHFOLQLFDORU
FOLQLFDO VWXGLHV SODQQHG RU LQ SURJUHVV RXWVLGH WKH 8. WKH\ GR QRW DSSHDU WR DIIHFW DQ\
FXUUHQWRUSUHYLRXV8.WULDOV

8QFHUWDLQW\

:KLOH*7$&DQG0+5$ PDNH HYHU\ HIIRUW WR PD[LPLVH SDWLHQWVDIHW\XQFHUWDLQWLHV
UHPDLQ 7KH UDQJH RI H[SODQDWLRQV WKDW KDYH EHHQ DGYDQFHG WR DFFRXQW IRU OHXNDHPLDOLNH
V\PSWRPV LQ WKH )UHQFK ;6&,' JHQH WKHUDS\ WULDO LOOXVWUDWH WKH GLIILFXOWLHV IDFHG E\
UHJXODWRU\ ERGLHV 7KHVH H[SODQDWLRQV LQFOXGH SUREOHPV ZLWK WKH LQWHJUDWLRQ RI WKH
WKHUDSHXWLFPDWHULDODQLPPXQHUHVSRQVHWRWKHYHFWRUDIDPLO\KLVWRU\RIFDQFHUDQGSUH
H[LVWLQJLQIHFWLRQVDQGRWKHUSUREOHPVV\PSWRPDWLFRILPPXQHGHILFLHQF\

5HJXODWRU\FKDOOHQJHV
*HQHWKHUDS\UHVHDUFKRQFKLOGUHQ

&RQGXFWLQJ PHGLFDO UHVHDUFK ZLWK FKLOGUHQ UDLVHV GLIILFXOW LVVXHV 7R GDWH YHU\ IHZ
JHQHWKHUDS\WULDOVKDYHLQYROYHGEDELHVRUFKLOGUHQEXWWKLVPD\FKDQJH7KHUHPD\EHJRRG
FOLQLFDO UHDVRQV WR LQYROYH FKLOGUHQ LQ JHQH WKHUDS\ WULDOV )RU LQVWDQFH VRPH GLVHDVHV
SURJUHVVLYHO\ ZRUVHQ ZLWK DJH DQG WKH EHVW FKDQFHV RI SRVLWLYH RXWFRPHV RIWHQ OLH ZLWK
LQWHUYHQWLRQVDWDQHDUO\VWDJH&)LVDFDVHLQSRLQW,WLVLUUHYHUVLEOHDIWHUDFHUWDLQVWDJHRI
GHWHULRUDWLRQRIWKHOXQJVVRLWLVRQO\SRVVLEOHWRVWDELOLVH UDWKHUWKDQLPSURYH D\HDUROG
SDWLHQW¶VFRQGLWLRQXVLQJFRQYHQWLRQDOWUHDWPHQWV

*HQH WKHUDS\ IRU &) PD\ WKXV ZRUN EHVW LQ WKH HDUO\ \HDUV RI OLIH ,Q VXFK FDVHV
UHVHDUFKHUVDUHUHTXLUHGWRGHPRQVWUDWHWKHWKHUDSHXWLFQHFHVVLW\RIXVLQJFKLOGUHQLQDJHQH
WKHUDS\WULDO

2EWDLQLQJLQIRUPHGFRQVHQWIRUDFKLOGWRWDNHSDUWLQDFOLQLFDOWULDOLVOHJDOO\FRPSOH[
DQGWKHUHLV RQJRLQJ GHEDWH LQ WKH 8.RQ WKLV LVVXH *7$&¶V JXLGHOLQHVRQZULWLQJSDWLHQW

ϯϭϰ

LQIRUPDWLRQOHDIOHWVLQFOXGHJXLGDQFHRQKRZWRFRPPXQLFDWHLQIRUPDWLRQWRWKHFKLOG7KH
0HGLFDO 5HVHDUFK &RXQFLO 05&  KDV DOVR SXEOLVKHG DQ HWKLFV JXLGH IRU PHGLFDO UHVHDUFK
LQYROYLQJFKLOGUHQ

$FFRXQWDELOLW\RSHQQHVVDQGWUDQVSDUHQF\

*7$& DQG 0+5$ DGRSW D FDVHE\FDVH DSSURDFK WR VDIHW\ LVVXHV )RU LQVWDQFH
IROORZLQJUHSRUWVRIOHXNDHPLDOLNHLOOQHVVLQWKUHHSDWLHQWVLQD)UHQFK;6&,'WULDO*7$&
DQG WKH 0+5$¶V &RPPLWWHH RQ 6DIHW\ RI 0HGLFLQHV PDGH MRLQW UHFRPPHQGDWLRQV WR WKH
'HSDUWPHQW RI +HDOWK '+  :KLOH VXFK DQ DSSURDFK LV ZHOFRPHG E\ UHVHDUFKHUV JURXSV
VXFK DV *HQH:DWFK KDYH EHHQ FULWLFDO RI D ODFN RI WUDQVSDUHQF\ LQ WKH 8.¶V JHQH WKHUDS\
UHJXODWLRQ)RULQVWDQFHLWSRLQWVRXWWKDW*7$&KROGVLWVPHHWLQJVIRUHYDOXDWLRQRIUHVHDUFK
SURSRVDOV LQ SULYDWH )XUWKHUPRUH 0+5$ SXEOLVKHV GHWDLOV RI FOLQLFDO WULDO DXWKRULVDWLRQ
DSSOLFDWLRQV LQ D GDWDEDVH DFFHVVLEOH RQO\ WR FRPSHWHQW (XURSHDQ UHJXODWRU\ ERGLHV WKH
(0($ DQG WKH &RPPLVVLRQ *7$& DUJXHV WKDW LW SXEOLVKHV PLQXWHV RI PHHWLQJV DQG DQ
DQQXDOUHSRUWEXWKDVWRSUHVHUYHLQGHSHQGHQFHLQHYDOXDWLRQSURWHFWSDWLHQWSULYDF\DQGLQ
ODWHUSKDVHVRIWULDOVHQVXUHFRPPHUFLDOFRQILGHQWLDOLW\0+5$EHOLHYHVWKDWFRQILGHQWLDOLW\
HQFRXUDJHVWKHUHSRUWLQJRIVHQVLWLYHLQIRUPDWLRQUHODWLQJWRSXEOLFKHDOWKFRQFHUQV$OO1+6
IXQGHG WULDOV PXVW EH UHJLVWHUHG LQ D SXEOLFO\ DFFHVVLEOH GDWDEDVH ,QGXVWU\ KDV DOVR
DQQRXQFHGYROXQWDU\PHDVXUHVRQUHJLVWHULQJ3KDVH,,,DQGIXUWKHUFOLQLFDOWULDOV

5HVRXUFHV

JHQHWKHUDS\WULDODSSOLFDWLRQVKDYHEHHQDSSURYHGLQWKH8.VLQFH+RZHYHU
DVLQYHVWPHQWLQUHVHDUFKJURZVWKHQXPEHURIWULDODSSOLFDWLRQVFRXOGDOVRJURZLQWKHQH[W
IHZ\HDUV7KLVFRXOGKDYHUHVRXUFHLPSOLFDWLRQVERWKIRU*7$&DQG0+5$

)XWXUHUHJXODWRU\FKDOOHQJHV

$V WKHVFLHQFHRIJHQHEDVHGPHGLFLQHVHYROYHVQHZ WHFKQRORJLHV DQG QHZ WKHUDSLHV
ZLOOHPHUJH)RULQVWDQFH51$LLVDPHWKRGRIµVLOHQFLQJ¶JHQHVWRSUHYHQWWKHIRUPDWLRQRI
XQZDQWHGSURWHLQ05&LVLQYHVWLQJLQEDVLFUHVHDUFKLQWRWKHWKHUDSHXWLFSRWHQWLDORI51$L
$WSUHVHQW*7$&DQG0+5$UHYLHZWKHXVHRIHPHUJHQWWHFKQRORJLHVLQFOLQLFDOWULDOVRQD
FDVHE\FDVHEDVLV1HZLQWHUYHQWLRQVFRPELQLQJJHQHWKHUDS\ZLWKRWKHUDSSURDFKHVVXFKDV
VWHP FHOO WKHUDS\ DUH HPHUJLQJ )RU LQVWDQFH ERQH PDUURZ VWHP FHOOV DUH DOUHDG\ XVHG LQ
VRPH JHQH WKHUDS\ WULDOV :KLOH ERQH PDUURZ WUDQVSODQWV DUH DQ HVWDEOLVKHG SUDFWLFH LW LV
SRVVLEOH WKDW LQ WKH ORQJHUWHUP JHQH WKHUDS\ WULDOV FRXOG LQYROYH VWHP FHOOV GHULYHG IURP
HPEU\RV 6XFK GHYHORSPHQWV PD\ SRVH QHZ FKDOOHQJHV WR WKH UHJXODWRU\ V\VWHP ZKLFK
FXUUHQWO\UHJXODWHVJHQHWKHUDS\DQGHPEU\RQLFVWHPFHOOUHVHDUFKVHSDUDWHO\7KH+RXVHRI
/RUGV 6WHP &HOO &RPPLWWHH FRQVLGHUHG ZD\V RI UHJXODWLQJ QHZ VWHP FHOO WKHUDSLHV DQG
LGHQWLILHGDQXPEHURIRSWLRQV7KHVHLQFOXGHGH[SDQGLQJWKHUHPLWRI*7$&WRWDNHRQWKLV
UROHRUHVWDEOLVKLQJDQHZUHJXODWRU\ERG\EDVHGRQWKH*7$&PRGHO'+KDVQRWHGWKDWLW
ZLOOFRQVLGHUWKHQHHGIRUIXUWKHURYHUVLJKWLQWKLVDUHDLQWKHOLJKWRIDQ\QHZGHYHORSPHQWV

)XWXUHSURVSHFWVDQGH[SHFWDWLRQV
5HVHDUFK

,Q LWV  :KLWH SDSHU WKH *RYHUQPHQW FRPPLWWHG  PLOOLRQ IRU UHVHDUFK LQWR
VLQJOH JHQH GLVRUGHUV DQG VDIHW\ RI YHFWRUV DV ZHOO DV WR HQDEOH DFFHVV IRU SXEOLF VHFWRU
UHVHDUFKHUV WR KLJK VWDQGDUG JHQH WKHUDS\ YHFWRU SURGXFWLRQ IDFLOLWLHV ,Q  WKH

ϯϭϱ

*RYHUQPHQW DZDUGHG  PLOOLRQ IRU KDHPRSKLOLD  PLOOLRQ IRU 'XFKHQQH 0XVFXODU
'\VWURSK\ PLOOLRQIRUFKLOGKRRGEOLQGQHVVDQG PLOOLRQIRUUHVHDUFKLQWR ORQJWHUP
VDIHW\RIVRPHWHFKQLTXHVXVHGIRUJHQHWKHUDS\,QDGGLWLRQ05&IXQGVEDVLFVFLHQFHVXFK
DVYHFWRUGHYHORSPHQWDQGGHOLYHU\PHWKRGVLQFHOOOLQHVDQGDQLPDOPRGHOV3XEOLFIXQGLQJ
RIJHQHWKHUDS\UHVHDUFKLVVXSSOHPHQWHGE\IXQGLQJIURPUHVHDUFKIRXQGDWLRQVDQGFKDULWLHV
2YHUWKHODVWILYH\HDUVWKH:HOOFRPH7UXVWKDVSURYLGHG PLOOLRQIRUQRQFOLQLFDOJHQH
WKHUDS\UHVHDUFKDLPHGDWVHYHUDOLQKHULWHGDQGDFTXLUHGGLVHDVHV&DQFHU5HVHDUFK8. &5
8. LVDOVRFXUUHQWO\IXQGLQJQLQHJHQHWKHUDS\UHVHDUFKSURMHFWV:KLOHSDWLHQWJURXSVDUH
ODUJHO\VDWLVILHGZLWKWKH FXUUHQWGLVHDVHOHGDSSURDFKWRJHQHWKHUDS\ UHVHDUFK UHVHDUFKHUV
KDYH FDOOHG IRU PRUH UHVHDUFK LQWR YHFWRU VDIHW\ GHOLYHU\ WHFKQLTXHV PROHFXODU FDXVHV RI
GLVHDVHVDQGXQFHUWDLQW\RIRXWFRPHV

:KDWKDSSHQVQH[W"

2SLQLRQVYDU\DVWRKRZVRRQFRPPHUFLDOJHQHWKHUDS\SURGXFWVZLOOEHRQWKHPDUNHW
)RULQVWDQFH&58.EHOLHYHVWKDWJHQHWKHUDS\SUHVHQWVUHDOLVWLFRSSRUWXQLWLHVIRUQHZZD\V
WR WUHDW FDQFHU EXW QRW IRU WKH QH[W  \HDUV 7KH *HQHWLF ,QWHUHVW *URXS D QDWLRQDO
DOOLDQFHRISDWLHQWRUJDQLVDWLRQVGRHVQRWH[SHFWWKDWZRUNLQJWKHUDSLHVIRUDZLGHUDQJHRI
GLVHDVHV ZLOO HPHUJH LQ WKH QHDUWHUP EXW VXJJHVWV WKDW UHVHDUFK ZLOO FRQWULEXWH WR WKH
NQRZOHGJHRIYHFWRUVLQVHUWLRQDQGGHOLYHU\WHFKQLTXHVDQGVDIHW\6XFKXQGHUVWDQGLQJZLOO
EHFULWLFDOWRWKHGHYHORSPHQWRISRWHQWLDOJHQHWKHUDSLHV

+RZHYHUDQXPEHURIJHQHWKHUDS\SURGXFWVPD\EHLQWKHSLSHOLQH)RULQVWDQFHD8.
ILUP$UN7KHUDSHXWLFVKDVWZRJHQHEDVHGPHGLFLQHVLQODWHVWDJHFOLQLFDOWULDOVLWFXUUHQWO\
DLPV WR DSSO\ WR PDUNHW WKHVH LQ  7KH ILUVW HYHU UHFRPELQDQW JHQH WKHUDS\ WR REWDLQ
PDUNHWLQJ DSSURYDO ZDV µ*HQGLFLQH¶ D JHQHEDVHG PHGLFLQH IRU WUHDWLQJ KHDG DQG QHFN
FDQFHU $V QRWHG HDUOLHU DQ\ JHQH WKHUDS\ SURGXFWV ZLOO KDYH WR EH DVVHVVHG WKURXJK WKH
(0($¶V FHQWUDOLVHG SURFHGXUH :KLOH ZHOOHVWDEOLVKHG IRU RWKHU ELRORJLFDO WKHUDSHXWLF
SURGXFWVWKLVSURFHGXUHKDVQRW\HWEHHQXVHGIRUJHQHWKHUDS\SURGXFWV,IWKH8.UHJXODWRU
WKH0+5$ LVQRWDSSRLQWHGDVWKH5DSSRUWHXURU&RUDSSRUWHXULWZLOOVWLOOUHYLHZWKHGDWD
SURYLGHG E\ WKH DSSOLFDQW FRPSDQ\ DQG SURYLGHV LQSXWV LQWR WKH SURFHVV RI DXWKRULVDWLRQ
WKURXJKWKH&RPPLWWHHIRU+XPDQ0HGLFLQDO3URGXFWV &+03 

(WKLFDOFRQVLGHUDWLRQV

:KLOHWKHERG\KDVPDQ\ELOOLRQVRIFHOOVRQO\DYHU\VPDOOSURSRUWLRQRIWKHVHFHOOV
DUH LQYROYHG LQ UHSURGXFWLRQ WKH SURFHVV E\ ZKLFK RXU JHQHV DUH KDQGHG RQ WR IXWXUH
JHQHUDWLRQV,QPDOHVWKHVHFHOOVDUHORFDWHGLQWKHWHVWHVDQGLQIHPDOHVLQWKHRYDULHV7KHVH
VSHFLDOUHSURGXFWLYHFHOOVDUHFDOOHGµJHUPFHOOV¶$OORWKHUFHOOVLQWKHERG\LUUHVSHFWLYHRI
ZKHWKHUWKH\DUHEUDLQOXQJVNLQRUERQHFHOOVDUHNQRZQDVµVRPDWLFFHOOV¶

,QJHQHWKHUDS\RQO\VRPDWLFFHOOVDUHWDUJHWHGIRUWUHDWPHQW7KHUHIRUHDQ\FKDQJHVWR
WKH JHQHV RIDQ LQGLYLGXDO E\ JHQHWKHUDS\ ZLOO RQO\ LPSDFW RQ WKH FHOOV RI WKHLU ERG\ DQG
FDQQRW EH SDVVHG RQWR WKHLU FKLOGUHQ &KDQJHV WR WKH VRPDWLF FHOOV FDQQRW EH SDVVHG RQ WR
IXWXUHJHQHUDWLRQV LQKHULWHG 6RPDWLFJHQHWKHUDS\WUHDWVWKHLQGLYLGXDODQGKDV QRLPSDFW
RQIXWXUHJHQHUDWLRQV

7KH,%&KDVPDQ\SRWHQWLDOWDVNVIURPSURYLGLQJLQIRUPDWLRQWRVXJJHVWLQJSULQFLSOHV
IRU LQWHUQDWLRQDO OHJDO UHFRJQLWLRQ ,Q LWV HWKLFV HYDOXDWLYH UROH LW PXVW VXJJHVW HWKLFDO

ϯϭϲ

SULQFLSOHVWKDWDUHJURXQGHGLQXQLYHUVDOLGHDVHYHQDVLWWDNHVDFFRXQWRIWKHKDSS\GLYHUVLW\
RIFXOWXUDODQGUHOLJLRXVWUDGLWLRQVWKDWFRH[LVWLQWKHZRUOG

7KHSULQFLSOHVDQGPDWHULDOVRILQWHUQDWLRQDOKXPDQULJKWVODZPD\\LHOGDULFKVXSSO\
RI GRFWULQHV IRU HYDOXDWLQJ ZKDW VKRXOG EH GRQH LQ GLVFUHWH ELRHWKLFV FDVHV $Q LQWHUHVWLQJ
UHFHQW 5HSRUW ³7KH 3URPRWLRQ RI +XPDQ 5LJKWV LQ WKH /LIH DQG +HDOWK 6FLHQFHV
5HFRPPHQGDWLRQV WR WKH 8QLWHG 1DWLRQV´ RUJDQL]HG E\ $XGUH\ &KDSPDQ FRQWDLQV
VXJJHVWLYHGLVFXVVLRQVRIWKLVSRLQW+XPDQULJKWVODZFRQWDLQVSURYLVLRQVWKDWDUHDQDORJRXV
WR WKH SULQFLSOHV WKDW IORZ IURP DQDO\VLV RI PRUDO REOLJDWLRQV LPSOLFLW LQ GRFWRUSDWLHQW
UHODWLRQVKLSV ZKLFK LV WKH VWDUWLQJ SRLQW IRU H[DPSOH RI PXFK RI WKH $QJOR$PHULFDQ
ELRHWKLFV OLWHUDWXUH DV ZHOO DV WKH ELRHWKLFV WUDGLWLRQV LQRWKHUFRPPXQLWLHV0RUHRYHUDQG
KDSSLO\ WKHVH YDULRXV WUDGLWLRQV FRQYHUJH LQ WKHLU WUHDWPHQW RI H[SHULPHQWDO PHGLFLQH RXU
SULQFLSDO ILHOG ZKHUH WKHUH LV VXEVWDQWLDO FRQVHQVXV RQ WKH TXHVWLRQV WR DVN DQG WKH
SURFHGXUHVWRIROORZ
,QDSSUDLVLQJJHQHWKHUDS\WKHVHSULQFLSOHVDWPLQLPXPPXVWEHWDNHQDFFRXQWRIDQG
EXLOWXSRQ(DFKLVGUDZQIURPLQWHUQDWLRQDOLQVWUXPHQWV
 WKHUHVSHFWIRUKXPDQGLJQLW\DQGZRUWK
 WKHULJKWWRHTXDOLW\EHIRUHWKHODZ
 WKHSURWHFWLRQRIULJKWVRIYXOQHUDEOHLQGLYLGXDOV
 WKH ULJKW QRW WR EH VXEMHFWHG ZLWKRXW IUHH FRQVHQW WR PHGLFDO RU VFLHQWLILF
H[SHULPHQWDWLRQ
 WKH ULJKW WR WKH KLJKHVW DWWDLQDEOH VWDQGDUG RI SK\VLFDO DQG PHQWDO KHDOWK DQG
DVVRFLDWHGULJKWVWRKHDOWKFDUH
 WKHULJKWWRSURWHFWLRQDJDLQVWDUELWUDU\LQWHUIHUHQFHZLWKSULYDF\RUZLWKWKHIDPLO\
 WKHULJKWWRHQMR\WKHEHQHILWVRIVFLHQWLILFSURJUHVVDQGLWVDSSOLFDWLRQDQG
 WKHULJKWWRIUHHGRPIRUVFLHQWLILFUHVHDUFK

,Q DV PXFK DV DOO SUHVHQW JHQH WKHUDS\ FRQVWLWXWHV PHGLFDO DQG VFLHQWLILF
H[SHULPHQWDWLRQ DQGDUDWKHUH[WUHPHIRUPRILW WKHULJKW³QRWWREHVXEMHFWHGZLWKRXWIUHH
FRQVHQW´WRLWLVJXDUDQWHHG)UHHFRQVHQWLPSOLHVLQIRUPHGFRQVHQWZLWKQRFRHUFLRQ7KH
GXWLHVLPSRVHGRQUHVHDUFKHUVDQGSURFHGXUHVIRULPSOHPHQWLQJWKHPKDYHEHHQVSHOOHGRXW
LQ RWKHU LQWHUQDWLRQDOO\ VLJQLILFDQW GRFXPHQWV 7KH 1XUHPEHUJ &RGH ZDV WKH IRXQGDWLRQ
7KDW &RGH ZDV IRUPXODWHG LQ WKH XQXVXDO FRQWH[W RI WKH LQWHUQDWLRQDO ZDU FULPHV WULDO IRU
SXUSRVHVRIVWDWLQJWKHLQWHUQDWLRQDOO\UHFRJQL]HGSULQFLSOHVWKDWPLJKWSHUPLWUHVHDUFKHUVWR
HQJDJHLQFRQGXFWWKDWZRXOGRWKHUZLVHEHDYLRODWLRQRIVXEMHFWV ULJKWV DQGLQGHHGZKHUH
LQMXU\ ZDVULVNHG RU FDXVHGD VHULRXV FULPH  7KH 'HFODUDWLRQRI+HOVLQNLSUHSDUHGE\WKH
:RUOG 0HGLFDO $VVRFLDWLRQ GHULYHG IURP DQG EXLOGV RQ WKH 1XUHPEHUJ &RGH ,Q WXUQ WKH
:RUOG +HDOWK 2UJDQL]DWLRQ :+2  DQG WKH &RXQFLO IRU ,QWHUQDWLRQDO 2UJDQL]DWLRQV RI
0HGLFDO 6FLHQFH &,206  EDVHG WKHLU LQIOXHQWLDO ³,QWHUQDWLRQDO *XLGHOLQHV IRU %LRPHGLFDO
5HVHDUFK,QYROYLQJ+XPDQ6XEMHFWV´RQWKH+HOVLQNL'HFODUDWLRQ7KHJXLGHOLQHV SXUSRVHLV
WR LQGLFDWH KRZ IXQGDPHQWDO HWKLFDO SULQFLSOHV VKRXOG JXLGH WKH FRQGXFW RI ELRPHGLFDO
UHVHDUFK LQYROYLQJ KXPDQ VXEMHFWV ,Q LWV PRVW UHFHQW YHUVLRQ &,206:+2   RQH
ILQGV DV JHQHUDO HWKLFDO SULQFLSOHV WKH SURSRVLWLRQ WKDW ³DOO UHVHDUFK LQYROYLQJ KXPDQ

ϯϭϳ

VXEMHFWV VKRXOG EH FRQGXFWHG LQ DFFRUGDQFH ZLWK WKUHH EDVLF HWKLFDO SULQFLSOHV QDPHO\
UHVSHFWIRUSHUVRQVEHQHILFHQFHDQGMXVWLFH´
7KLVLVSUHFLVHO\WKHODQJXDJHRIWKH$QJOR$PHULFDQWUDGLWLRQZLWKUHVSHFWWRKXPDQ
H[SHULPHQWV VWUHVVLQJ SULQFLSOHV RI DXWRQRP\ FRVWEHQHILW DQDO\VLV DQG MXVWLFH LQ
GLVWULEXWLRQRIEHQHILWDQGULVN


2YHUYLHZ

x *HQHWKHUDS\FDQSRWHQWLDOO\WUHDWGLVHDVHVVXFKDV&)FDQFHUVKHDUWGLVHDVHDQG+,9
LQIHFWLRQ7RGDWHQRJHQHWKHUDS\FOLQLFDOWULDOKDVJLYHQULVHWRWKHGHYHORSPHQWRID
FRPPHUFLDOWUHDWPHQWLQWKH8.
x :KLOHLQGXVWU\FRQVLGHUVFRPPHUFLDOJHQHWKHUDS\OLNHO\IRUVRPHFDQFHUVLQWKHQH[W
IHZ\HDUVRWKHUVVXJJHVWLWPD\EHWR\HDUVEHIRUH JHQH WKHUDSLHVDUH ZLGHO\
DYDLODEOH
x 3RWHQWLDOLVVXHVZLWKJHQHWKHUDS\LQFOXGHHIIHFWLYHGHOLYHU\ORQJHYLW\RIWKHWKHUDS\
DQGVDIHW\FRQFHUQV
x *HQHWKHUDS\FOLQLFDOWULDOVLQWKH8.DUHUHJXODWHGE\*7$&DQG0+5$0+5$LV
DOVRUHVSRQVLEOHIRUUHJXODWLQJPHGLFLQDOJHQHSURGXFWVLQWKH8.
x 7KHUHJXODWRU\V\VWHPFRQVLGHUVDOOJHQHWKHUDS\UHVHDUFKSURSRVDOVRQDFDVHE\FDVH
EDVLV WDNLQJ HWKLFDO DQG VFLHQWLILF IDFWRUV LQWR DFFRXQW 6RPH KDYH FDOOHG IRU PRUH
RSHQDQGWUDQVSDUHQWDVVHVVPHQWV
x 7HFKQLFDOGHYHORSPHQWVPD\QHFHVVLWDWHFKDQJHVWRWKHFXUUHQWUHJXODWRU\IUDPHZRUN
ZKLFKKDVVHSDUDWHDUUDQJHPHQWVIRUWKHUDSLHVGHULYHGIURPKXPDQJHQHVVWHPFHOOV
FHOOVDQGWLVVXHV

5HIHUHQFHV

$PHULFDQ$VVRFLDWLRQIRUWKH$GYDQFHPHQWRI6FLHQFH³7KH3URPRWLRQRI+XPDQ5LJKWVLQ
WKH /LIH DQG +HDOWK 6FLHQFHV 5HFRPPHQGDWLRQV WR WKH 8QLWHG 1DWLRQV´  
RUJDQL]HGE\$XGUH\&KDSPDQ
&RXQFLOIRUWKH,QWHUQDWLRQDO2UJDQL]DWLRQVRI0HGLFDO6FLHQFHV &,206 ³*HQHWLFV(WKLFV
DQG+XPDQ9DOXHV+XPDQ*HQRPH0DSSLQJ*HQHWLF6FUHHQLQJDQG*HQH7KHUDS\´
7KH'HFODUDWLRQRI,QX\DPD   
&RXQFLO IRU WKH ,QWHUQDWLRQDO 2UJDQL]DWLRQV RI 0HGLFDO 6FLHQFHV &,206  DQG WKH :RUOG
+HDOWK 2UJDQL]DWLRQ :+2  ³,QWHUQDWLRQDO (WKLFDO *XLGHOLQHV IRU %LRPHGLFDO
5HVHDUFK,QYROYLQJ+XPDQ6XEMHFWV´  
)RXQGDWLRQ %%9 ,QWHUQDWLRQDO :RUNVKRS RQ +XPDQ *HQRPH 3URMHFW /HJDO $VSHFWV
'HFODUDFLRQGH%LOEDR  
+DQV0DUWLQ 6DVV ³$ &ULWLTXH RI WKH (QTXHWH &RPPLVVLRQ V 5HSRUW RQ *HQH 7HFKQRORJ\´
%LRHWKLFV  
/HUR\ :DOWHUV ³+XPDQ *HQH 7KHUDS\ (WKLFV DQG 3XEOLF 3ROLF\´ +XPDQ *HQH 7KHUDS\
  
0DUFLD %DULQDJD ³*HQH 7KHUDS\ IRU &ORJJHG $UWHULHV 3DVVHV WKH 7HVW LQ 3LJV´ 6FLHQFH
  

ϯϭϴ

0LQLVWU\RI+HDOWKDQG6RFLDO$IIDLUV 1RUZD\ ³%LRWHFKQRORJ\5HODWHGWR+XPDQ%HLQJV´
5HSRUW1R  
1HOVRQ$:LYHODQG/HUR\ :DOWHUV³*HUP/LQH*HQH 0RGLILFDWLRQ DQG'UXJ 3UHYHQWLRQ
6RPH0HGLFDODQG(WKLFDO3HUVSHFWLYHV´6FLHQFH  
2XU,QKHULWDQFH2XU)XWXUH'HSDUWPHQWRI+HDOWK-XQH
3DUOLDPHQWDU\ $VVHPEO\ RI WKH &RXQFLO RI (XURSH )RUWLHWK 2UGLQDU\ 6HVVLRQ
³5HFRPPHQGDWLRQ  2Q WKH 8VH RI +XPDQ (PEU\RV DQG )RHWXVHV LQ 6FLHQWLILF
5HVHDUFK´6WUDVERXUJ)UDQFH  
3DWULFLD%DLUG³$OWHULQJ+XPDQ*HQHV6RFLDO(WKLFDODQG/HJDO,PSOLFDWLRQV´3HUVSHFWLYHV
LQ%LRORJ\DQG0HGLFLQH  
5HSRUWIURPWKH+RXVHRI/RUGV6HOHFW&RPPLWWHH6WHP&HOO5HVHDUFK+/ L )HEUXDU\

5HSRUWRIWKH&RPPLWWHHRQWKH(WKLFVRI*HQH7KHUDS\ &ORWKLHU&RPPLVVLRQ SUHVHQWHGWR
3DUOLDPHQWE\&RPPDQGRI+HU0DMHVW\-DQXDU\
5REHUW0.RWLQ³3URVSHFWVIRUWKH8VHRI$GHQR$VVRFLDWHG9LUXVDVD9HFWRUIRU+XPDQ
*HQH7KHUDS\´+XPDQ*HQH7KHUDS\  
7KH6WRU\RI*HQGLFLQH7KH6WRU\EHKLQGWKH)LUVW*HQH7KHUDS\ %LRSKDUP,QWHUQDWLRQDO
0D\
8QLWHG6WDWHV)RRGDQG'UXJ$GPLQLVWUDWLRQ )'$ ³3RLQWVWR&RQVLGHULQ+XPDQ6RPDWLF
&HOO7KHUDS\DQG*HQH7KHUDS\´)HG5HJ  
8QLWHG 6WDWHV 3UHVLGHQW V &RPPLVVLRQ IRU WKH 6WXG\ RI (WKLFDO 3UREOHPV LQ 0HGLFLQH DQG
%LRPHGLFDO%HKDYLRUDO5HVHDUFK³6SOLFLQJ/LIH´  
9ODGLPLU,YDQRY³(WKLFVDQG+XPDQ*HQHWLFV´LQ&RXQFLORI(XURSH³6HFRQG6\PSRVLXP
RQ%LRHWKLFV´6WUDVERXUJ
: )UHQFK $QGHUVRQ DQG -RKQ & )OHWFKHU ³*HQH 7KHUDS\ LQ +XPDQ %HLQJV :KHQ LV LW
(WKLFDOWR%HJLQ"´1HZ(QJODQG-RXUQDORI0HGLFLQH  
:)UHQFK$QGHUVRQ³*HQH7KHUDS\IRU&DQFHU´+XPDQ*HQH7KHUDS\  
:)UHQFK$QGHUVRQ³*HQH7KHUDS\IRU*HQHWLF'LVHDVH´+XPDQ*HQH7KHUDS\
 
:)UHQFK$QGHUVRQ³:DV,W-XVW6WXSLGRU$UH:H3RRU(GXFDWRUV´+XPDQ*HQH7KHUDS\
  















ϯϭϵ

 &KDSWHU
*HQHNQRFNRXW
,QWURGXFWLRQ
$ JHQHNQRFNRXW .2 LVDJHQHWLFWHFKQLTXHLQZKLFKDQ RUJDQLVPLVHQJLQHHUHG WR
FDUU\ JHQHV WKDW KDYH EHHQ PDGH LQRSHUDWLYH KDYH EHHQ NQRFNHG RXW RI WKH RUJDQLVP 
$OVRNQRZQDVNQRFNRXWRUJDQLVPVRUVLPSO\NQRFNRXWVWKH\DUHXVHGLQOHDUQLQJDERXWD
JHQHWKDWKDVEHHQVHTXHQFHGEXWZKLFKKDVDQXQNQRZQRULQFRPSOHWHO\NQRZQIXQFWLRQ
5HVHDUFKHUVGUDZLQIHUHQFHVIURPWKHGLIIHUHQFHEHWZHHQWKHNQRFNRXWRUJDQLVPDQGQRUPDO
LQGLYLGXDOV 7KH WHUP DOVR UHIHUV WR WKH SURFHVV RI FUHDWLQJ VXFK DQ RUJDQLVP DV LQ
NQRFNLQJ RXW D JHQH 7KH WHFKQLTXH LV HVVHQWLDOO\ WKH RSSRVLWH RI D JHQH NQRFNLQ
.QRFNRXW LV RIWHQ DEEUHYLDWHG DV .2 .QRFNLQJ RXW WZR JHQHV VLPXOWDQHRXVO\ LQ DQ
RUJDQLVPLVNQRZQDVDGRXEOHNQRFNRXW '.2 6LPLODUO\WKHWHUPVWULSOHNQRFNRXW 7.2 
DQGTXDGUXSOHNQRFNRXWV 4.2 DUHXVHGWRGHVFULEHRUNQRFNHGRXWJHQHVUHVSHFWLYHO\

.QRFNRXW0HWKRGRORJ\
.QRFNRXWLVDFFRPSOLVKHGWKURXJKDFRPELQDWLRQRIWHFKQLTXHVEHJLQQLQJLQWKHWHVW
WXEH ZLWK D SODVPLG D EDFWHULDO DUWLILFLDO FKURPRVRPH RU RWKHU '1$ FRQVWUXFW DQG
SURFHHGLQJ WR FHOO FXOWXUH ,QGLYLGXDO FHOOV DUH JHQHWLFDOO\ WUDQVIRUPHG ZLWK WKH '1$
FRQVWUXFW 2IWHQ WKH JRDO LV WR FUHDWH D WUDQVJHQLF DQLPDO WKDW KDV WKH DOWHUHG JHQH ,I VR
HPEU\RQLFVWHPFHOOVDUHJHQHWLFDOO\WUDQVIRUPHGDQGLQVHUWHGLQWRHDUO\HPEU\RV5HVXOWLQJ
DQLPDOV ZLWK WKH JHQHWLF FKDQJH LQ WKHLU JHUPOLQH FHOOV FDQ WKHQ RIWHQ SDVV WKH JHQH
NQRFNRXWWRIXWXUHJHQHUDWLRQV
7KHFRQVWUXFWLVHQJLQHHUHGWRUHFRPELQHZLWKWKHWDUJHWJHQHZKLFKLVDFFRPSOLVKHG
E\ LQFRUSRUDWLQJ VHTXHQFHV IURP WKH JHQH LWVHOI LQWR WKH FRQVWUXFW 5HFRPELQDWLRQ WKHQ
RFFXUVLQWKHUHJLRQRIWKDWVHTXHQFHZLWKLQWKHJHQHUHVXOWLQJLQWKHLQVHUWLRQRIDIRUHLJQ
VHTXHQFHWRGLVUXSWWKHJHQH:LWKLWVVHTXHQFHLQWHUUXSWHGWKHDOWHUHGJHQHLQPRVWFDVHV
ZLOOEHWUDQVODWHGLQWRDQRQIXQFWLRQDOSURWHLQLILWLVWUDQVODWHGDWDOO
$FRQGLWLRQDONQRFNRXWDOORZVJHQHGHOHWLRQLQDWLVVXHRUWLPHVSHFLILFPDQQHU7KLV
LVGRQHE\LQWURGXFLQJVKRUWVHTXHQFHVFDOOHGOR[3VLWHVDURXQGWKHJHQH7KHVHVHTXHQFHV
ZLOOEHLQWURGXFHGLQWRWKHJHUPOLQHYLDWKHVDPHPHFKDQLVPDVDNQRFNLQ7KLVJHUPOLQH
FDQ WKHQ EH FURVVHG WR DQRWKHU JHUPOLQH FRQWDLQLQJ &UHUHFRPELQDVH ZKLFK LV D EDFWHULDO
HQ]\PHWKDWFDQUHFRJQL]HWKHVHVHTXHQFHVUHFRPELQHVWKHPDQGGHOHWHVWKHJHQHIODQNHG
E\WKHVHVLWHV
%HFDXVH WKH GHVLUHG W\SH RI '1$ UHFRPELQDWLRQ LV D UDUH HYHQW LQ WKH FDVH RI PRVW
FHOOV DQG PRVW FRQVWUXFWV WKH IRUHLJQ VHTXHQFH FKRVHQ IRU LQVHUWLRQ XVXDOO\ LQFOXGHV D
UHSRUWHU 7KLV HQDEOHV HDV\ VHOHFWLRQ RI FHOOV RU LQGLYLGXDOV LQ ZKLFK NQRFNRXW ZDV
VXFFHVVIXO 6RPHWLPHV WKH '1$ FRQVWUXFW LQVHUWV LQWR D FKURPRVRPH ZLWKRXW WKH GHVLUHG
KRPRORJRXVUHFRPELQDWLRQZLWKWKHWDUJHWJHQH7RDYRLGLVRODWLRQRIVXFKFHOOVWKH'1$
FRQVWUXFWRIWHQFRQWDLQVDVHFRQGUHJLRQRI'1$WKDWDOORZVVXFKFHOOVWREHLGHQWLILHGDQG
GLVFDUGHG
,Q GLSORLG RUJDQLVPV ZKLFK FRQWDLQ WZR DOOHOHV IRU PRVW JHQHV DQG PD\ DV ZHOO
FRQWDLQ VHYHUDO UHODWHG JHQHV WKDW FROODERUDWH LQ WKH VDPH UROH DGGLWLRQDO URXQGV RI
WUDQVIRUPDWLRQ DQG VHOHFWLRQ DUH SHUIRUPHG XQWLO HYHU\ WDUJHWHG JHQH LV NQRFNHG RXW
6HOHFWLYHEUHHGLQJPD\EHUHTXLUHGWRSURGXFHKRPR]\JRXVNQRFNRXWDQLPDOV7KHHIIHFWRI

ϯϮϬ

 WKH DEVHQFH RI D JHQH FDQ EH YHU\ LQIRUPDWLYH DERXW WKH QRUPDO IXQFWLRQ RI WKH JHQH
(OLPLQDWLQJDJHQH JHQHNQRFNRXW FRPSOHWHO\IURPDGLSORLGRUJDQLVPUHTXLUHVNQRFNLQJ
RXWERWKFRSLHVRIWKHJHQHLQWKHFHOOV7KHUHDUHDYDULHW\RIPHWKRGVIRUSURGXFLQJJHQH
NQRFNRXWVLQGLIIHUHQWPRGHORUJDQLVPV
.QRFNLQLVVLPLODUWRNQRFNRXWEXWLQVWHDGLWUHSODFHVDJHQHZLWKDQRWKHULQVWHDGRI
GHOHWLQJLW
.QRFNRXWDQLPDOV

³7KHSXUSRVHIXOGHOHWLRQRIDVSHFLILFJHQHIRUVWXG\LQJLWVIXQFWLRQVLVNQRFNLQJRXW
9HU\XVHIXOLQXQGHUVWDQGLQJUROHRIDVSHFLILFJHQHLQDGLVHDVH´

.QRFNRXW0RXVH

$PRXVHLQZKLFKDYHU\VSHFLILFHQGRJHQRXVJHQHKDVEHHQDOWHUHGLQVXFKDZD\WKDW
LQWHUIHUHVZLWKQRUPDOH[SUHVVLRQLHLWKDVEHHQNQRFNHGRXW
.QRFNRXW0LFHDUHSURGXFHGWR

x 7RVWXG\HIIHFWVRIJHQHSURGXFWVELRFKHPLFDO SDWKZD\VDOWHUQDWLYH FRPSHQVDWRU\ 
SDWKZD\VDQGGHYHORSPHQWDOSDWKZD\V
x 7RUHFUHDWHKXPDQGLVHDVHVLQDQLPDOVWRHVWDEOLVKPRGHOVWRWHVWWKHEHQHILFLDOHIIHFWV
RIGUXJVRUJHQHWKHUDS\

3URFHGXUHIRU*HQHUDWLQJD.20RXVH

*HQHDOWHUDWLRQLQ.2PLFHLVWDUJHWHGWRYHU\VSHFLILFJHQHV'1$PXVWLQWHJUDWHDW
SUHFLVHSRVLWLRQVLQWKHJHQRPH,QWHJUDWLRQRIWKHDOWHUHGJHQHWDNHVSODFHLQHPEU\RQLFVWHP
FHOOV H[ YLYR  9HULILFDWLRQ RI H[DFW ORFDWLRQ RI LQWHJUDWLRQ RFFXUV EHIRUH WKH (6& LV
LQWURGXFHGLQWREODVWRF\VWVWREHFRPHSDUWRIWKHGHYHORSLQJHPEU\R

x '1$WKDWKDVEHHQHQJLQHHUHGWRFRQWDLQDPXWDQWFRS\RIWKHJHQHLVLQWURGXFHGLQWR
VSHFLDOHPEU\RQLFVWHPFHOOV (6FHOOV WKDWZHUHJURZLQJLQWLVVXHFXOWXUH

x &HOOV WKDW WDNH XS WKH '1$ DUH WHVWHG WR ILQG WKRVH LQ ZKLFK WKH PXWDQW FRS\ KDV
UHSODFHGRQHJRRGFRS\RIWKHJHQH

x &HOOVZLWKRQHPXWDQWFRS\DUHLQWURGXFHGLQWRDQHDUO\HPEU\R EODVWRF\VW WKDWZLOO

WDNHXSWKHVHFHOOV

x 0LFHWKDWDUHERUQIURPWKLVPDQLSXODWLRQ DQGFRQWDLQWKHRQHPXWDQWFRS\LQWKHLU
JHUPFHOOV DUHPDWHGWRHDFKRWKHU

x 2QHLQIRXUPLFHIURPWKLVPDWLQJZLOOFRQWDLQWZRPXWDQWFRSLHVRIWKHJHQH )LJXUH
 

ϯϮϭ

 

)LJXUH(QJLQHHULQJD.QRFNRXW0RXVH


ϯϮϮ

0LFHNQRFNHGRXWIRU

D5HFRPELQDWLRQ$FWLYDWLQJ*HQH.QRFN2XW
'HYHORSPHQW
$ QHRP\FLQ UHVLVWDQFH FDVVHWWH ZDV LQVHUWHG LQ WKH 5$* JHQH UHVXOWLQJ LQ D  ES
GHOHWLRQ LQ WKH   HQG RI WKH FRGLQJ VHTXHQFH LQWR GHULYHG $% (6 FHOO OLQH 7KH
&%/-VWUDLQZDVJHQHUDWHGE\EDFNFURVVLQJPLFHFDUU\LQJWKH5DJPXWDWLRQWLPHV
WR &%/- LQEUHG PLFH 5DJ GHILFLHQW PLFH ZHUH WUDQVIHUUHG WR WKH 12'/W6] VWUDLQ
EDFNJURXQG
'HVFULSWLRQ
5$*GHILFLHQWPLFHDUHYLDEOHDQGIHUWLOH7KH\DUHXQDEOHWRLQLWLDWH9 ' -UHFRPELQDWLRQ
LQ,JDQG7&5JHQHVDQGODFNIXQFWLRQDO7DQG%O\PSKRF\WHV$OWKRXJK5$*H[SUHVVLRQ
KDVEHHQUHSRUWHGLQWKHFHQWUDOQHUYRXVV\VWHPRIWKHPRXVHQRREYLRXVQHXURDQDWRPLFDORU
EHKDYLRUDO DEQRUPDOLWLHV KDYH EHHQ IRXQG LQ WKH 5$* GHILFLHQW PLFH 2Q WKH 12'
EDFNJURXQG 12'5DJ PLFH DUH GHYRLG RI PDWXUH 7 RU % FHOOV 12'/W6]5DJ
UHFLSLHQWV RI DGRSWLYHO\ WUDQVIHUUHG VSOHHQ FHOOV IURP GLDEHWLF 12'/W PLFH UDSLGO\
GHYHORSGLDEHWHV

E7FHOOUHFHSWRUDOSKDFKDLQ.QRFN2XW
'HYHORSPHQW7KH7FUDRWDUJHWHGPXWDWLRQZDVJHQHUDWHGLQ*.(6FHOOV GHULYHGIURP
VXEVWUDLQ32OD+VG YLDKRPRORJRXV UHFRPELQDWLRQ7KHQHRP\FLQUHVLVWDQFHJHQHZDV
LQVHUWHGLQWRWKHILUVWFRQVWDQWUHJLRQRIWKH7FUDJHQH7KH7FUDWP0MRDOOHOHRQWKH&
PL[HGEDFNJURXQGZDVWKHQWUDQVIHUUHGWRWKH12'EDFNJURXQG7KHOLQHLVFXUUHQWO\DWWKH
WKEDFNFURVVWR12'/W-
'HVFULSWLRQ
7KHPXWDWLRQSUHYHQWVH[SUHVVLRQRIDQ\HQGRJHQRXV7&5DOSKDFKDLQVDQGWKHUHE\EORFNV
GLIIHUHQWLDWLRQRIDOSKDEHWD7FHOOV12'PLFHKRPR]\JRXVIRUWKH7FUDWDUJHWHGPXWDWLRQ
ODFNDOSKDEHWD7FHOOVDQGDUHFRPSOHWHO\SURWHFWHGIURPGLDEHWHVGHYHORSPHQW%HFDXVHRI
WKH FRPSOHWH HOLPLQDWLRQ RI DOSKD EHWD 7 FHOOV WKHVH PLFH DUH XVHIXO LQ DGRSWLYH WUDQVIHU
H[SHULPHQWVRULQFURVVHVWR7&5DEWUDQVJHQLFOLQHV

F,PPXQRJOREXOLQ,J0.QRFNRXW
'HYHORSPHQW
7KHPHPEUDQHH[RQVRIWKHJHQHHQFRGLQJWKHPXFKDLQFRQVWDQWUHJLRQZHUHGLVUXSWHGE\
LQVHUWLRQRIDQHRP\FLQUHVLVWDQWJHQH7KHPXWDWLRQ ZDVWKHQWUDQVIHUUHG IURPWKHRULJLQDO
FKLPHULFVWRFNZLWKDPL[HG6YDQG&%/JHQRPHRQWRWKH12'/WEDFNJURXQG
'HVFULSWLRQ
+HWHUR]\JRXV PLFH DUH QRUPDO DQG IHUWLOH ,Q KRPR]\JRXV DQLPDOV KRZHYHU %FHOO
GHYHORSPHQWLVVWRSSHGDWWKHVWDJHRISUH%FHOOPDWXUDWLRQDQG%FHOOVDUHWKHUHIRUHDEVHQW
1R,J0LVSUHVHQWRQWKHSUH%FHOOVXUIDFH12'ȝ07GHILFLHQWPLFHKDYHQRUPDOQXPEHUV
RI7FHOOVEXWDUHIUHHRIRYHUW'LDEHWHVDQGLQVXOLWLVUHVLVWDQW7KHIUHTXHQF\RIGLVHDVHLQWKH
% O\PSKRF\WH LQWDFW VHJUHJDQWV LV HTXLYDOHQW WR WKDW RI VWDQGDUG 12' PLFH +RPR]\JRXV
ȝ07NQRFNRXWDQLPDOVGLVSOD\DKLJKLQFLGHQFHRIO\PSKRPDRIERWK7DQG%FHOORULJLQ
FRPSDUHG ZLWK WKHVH PXWDWLRQV RQ RWKHU JHQHWLF EDFNJURXQGV 7KH O\PSKRPD LQFLGHQFH LQ
ERWK VWUDLQV LV JUHDWHU LQ IHPDOHV UHIOHFWLQJ WKH JUHDWHU LQFLGHQFH RI DXWRLPPXQH W\SH 
GLDEHWHVLQ12'IHPDOHVWKDQLQPDOHV

G,QWHUOHXNLQ.QRFN2XW
'HYHORSPHQW

ϯϮϯ

$ QHRP\FLQ UHVLVWDQFH FDVVHWWH ZDV XVHG WR GLVUXSW WKH ILUVW H[RQ RI ,/ LQWR (
HPEU\RQLF VWHP FHOOV 7KH PXWDWLRQ ZDV PDLQWDLQHG RQ D % VHJUHJDWLQJ EDFNJURXQG
XQWLOLWZDVWUDQVIHUUHGWR12'/WXVLQJDPDUNHUDVVLVWHGSURWRFRO
'HVFULSWLRQ
0LFH KRPR]\JRXV IRU WKH ,/ WDUJHWHG PXWDWLRQ DUH YLDEOH DQG IHUWLOH 7 DQG % FHOO
GHYHORSPHQWLVQRUPDOEXW,J*DQG,J(OHYHOVDQGWKHDELOLW\RIKRPR]\JRXVPXWDQWPLFH
WRSURGXFH7KGHULYHGF\WRNLQHVDUHVLJQLILFDQWO\UHGXFHG2QWKH12'EDFNJURXQGWKH,/
QXOOPXWDWLRQGRHVQRWDFFHOHUDWHRULQWHQVLI\LQVXOLWLVLQUHJXODU12'DQGKDVQRHIIHFWRQ
WKHWLPLQJRUIUHTXHQF\RIWKHWUDQVLWLRQWRGLDEHWHV&R[VDFNLHYLUXV% &9% LQIHFWLRQLQ
12'PLFHOHDGVWRDFFHOHUDWLRQRI7\SHGLDEHWHV:KHQ12',/PLFHDUHLQIHFWHGZLWK
&9%DWZHHNVRIDJHWKHRQVHWRIGLDEHWHVLVDFFHOHUDWHGLQ
12',/PLFHFRPSDUHGWR12',/PLFH,QWKHDEVHQFH RIDQ LQVXOLWLF WKUHVKROG
&9% LQIHFWLRQ OHDGV WR ORQJWHUP GLVHDVH SURWHFWLRQ 7KLV SURWHFWLYH PHFKDQLVP LV QRW
DIIHFWHGE\WKHGLVUXSWLRQRI,/JHQH


H,QWHUOHXNLQ.QRFN2XW
'HYHORSPHQW
7KHILUVWH[RQRI,/ZDVGLVUXSWHGDIWHUWKHIRXUWKFRGRQDQHRP\FLQUHVLVWDQFHFDVVHWWH
DQG DQ DGGLWLRQDO WHUPLQDWLRQ FRGRQ LQ WKH WKLUG H[RQ ZDV XVHG IRU KRPRORJRXV
UHFRPELQDWLRQLQ((6FHOOV 32OD+VGGHULYHG 7KHPXWDWLRQZDVWKHQWUDQVIHUUHG
WRWKH12'/WEDFNJURXQGXVLQJDPDUNHUDVVLVWHGSURWRFRO12'/WPLFHKHWHUR]\JRXVIRU
WKLV,/DOOHOHDQGKRPR]\JRXV IRU GLDEHWHV VXVFHSWLELOLW\ ORFL ,GG ZHUHLQWHUFURVVHGWR
GHYHORSPLFHKRPR]\JRXVIRU,/WP&JQDQGDOO,GGORFL
'HVFULSWLRQ
0LFHKRPR]\JRXVIRUWKH,/WDUJHWHGPXWDWLRQDUHYLDEOHDQG IHUWLOH ZKHQ KRXVHG XQGHU
63)FRQGLWLRQV7KLVPXWDQWGHYHORSVW\SHGLDEHWHVDWWKHVDPHUDWHDVWKH12'/WSDUHQWDO
VWUDLQ7KH,OPXWDWLRQDOVRUHQGHUVWKLVOLQHVXVFHSWLEOHWRFROLWLV DOWKRXJKQRWDVVHYHUHDV
RWKHUVWUDLQVRI,OGHILFLHQWPLFHZKHQPDLQWDLQHGXQGHUVWDQGDUGKRXVLQJFRQGLWLRQV

I*DPPD,QWHUIHURQ.QRFN2XW
'HYHORSPHQW
7KHWDUJHWLQJYHFWRUKDVDQHRP\FLQUHVLVWDQFHJHQHLQVHUWHGLQWRH[RQZKLFKLQWURGXFHVD
WHUPLQDLVRQFRGRQDIWHUWKHILUVWDPLQRDFLGVRIWKHPDWXUH,)1ȖSURWHLQ7KHWDUJHWLQJ
YHFWRUZDVWUDQVIHUUHGLQWR$%HPEU\RQLFVWHPV7KHPXWDWLRQZDVWKHQWUDQVIHUUHGWRWKH
12'EDFNJURXQG
'HVFULSWLRQ
'HILFLHQWPLFHGHYHORSQRUPDOO\DQGDUHKHDOWK\LQWKHDEVHQFHRISDWKRJHQV+RZHYHUPLFH
GHILFLHQW IRU ,)1Ȗ KDYH LPSDLUHG SURGXFWLRQ RI PDFURSKDJH DQWLPLFURELDO SURGXFWV DQG
UHGXFHGH[SUHVVLRQRIPDFURSKDJHPDMRUKLVWRFRPSDWLELOLW\FRPSOH[FODVV,,DQWLJHQV12'
0LFH KRPR]\JRXV IRU WKH ,)1Ȗ .2 WDUJHWHG PXWDWLRQ DUH YLDEOH DQG IHUWLOH 7KH JHQHWLF
DEVHQFHRI,)1ȖGRHVQRWSUHYHQWHLWKHULQVXOLWLVRUGLDEHWHVLQWKH12'PLFHEXWLQFUHDVHV
WKHWLPHWRRQVHW6SOHQRF\WHVWDNHQIURP,)1ȖGHILFLHQWGLDEHWLFPLFHDUHIXOO\FDSDEOHRI
WUDQVIHUULQJGLDEHWHVWRQDLYHUHFLSLHQWV,QERWK12',)1ȖDQG12',)1ȖPLFH
,/DGPLQLVWUDWLRQJHQHUDWHVDPDVVLYHDQGGHVWUXFWLYHLQVXOLWLVDQGLQFUHDVHVWKHQXPEHURI
SDQFUHDWLF&'  FHOOV12',)1ȖKRPR]\JRXVPLFHGRQRWGLVSOD\LQFUHDVHGDFLQDUFHOO
DSRSWRVLVDQGDEQRUPDOVDOLYDU\SURWHLQH[SUHVVLRQW\SLFDOO\REVHUYHGLQSDUHQWDO12'PLFH
EHIRUH 6MRJUHQ V V\QGURPHOLNH DXWRLPPXQH H[RFULQRSDWK\ :KHQ 12' ,)1Ȗ  PLFH LV
LQIHFWHG ZLWK &R[VDFNLHYLUXV % ,QVXOLWLV RU GLDEHWHV GHYHORSPHQW LV GHOD\HG E\ VHYHUDO

ϯϮϰ

ZHHNV FRPSDUHG WR 12' PLFH :KHQ PLFH DUH LQIHFWHG DW  ZHHNV RI DJH QHLWKHU
DFFHOHUDWLRQQRUORQJWHUPSURWHFWLRQLVHOLFLWHGLQ12',)1ȖPLFH

J*DPPD,QWHUIHURQ5HFHSWRU.QRFN2XW
'HYHORSPHQW
7KH,)1Ȗ5JHQHZDVGLVUXSWHGE\LQVHUWLQJWKHQHRP\FLQUHVLVWDQFHJHQHLQWRH[RQZKLFK
HQFRGHV DQ H[WUDFHOOXODU PHPEUDQH SUR[LPDO SRUWLRQ RI WKH 5HFHSWRU 0LFH FDUU\LQJ WKH
,)1Ȗ QXOO PXWDWLRQ ZHUH EDFNFURVVHG ZLWK 12' PLFH ZLWK LQWHUFURVVHV WR SURGXFH
H[SHULPHQWDODQLPDOV :DQJ% HW DO0DWKLV'  7KH OLQH LVDW WKH !WK EDFNFURVVLQ
12'/W-
'HVFULSWLRQ
0LFH ZLWKRXW WKH ,)1Ȗ5 KDYH QR RYHUW DQRPDOLHV DQG WKHLU LPPXQH V\VWHP DSSHDU WR
GHYHORSQRUPDOO\+RZHYHUPXWDQWPLFHKDYHDGHIHFWLYHLPPXQHUHVLVWDQFHGHVSLWHQRUPDO
F\WRWR[LF DQG 7 KHOSHU FHOO UHVSRQVHV 12' PLFH KRPR]\JRXV IRU WKH ,)1Ȗ5 PXWDWLRQ
VKRZ D PDUNHG LQKLELWLRQ RI LQVXOLWLV ERWK LQ WKH NLQHWLFV DQG SHQHWUDQFH DQG QR VLJQV RI
GLDEHWHV HLWKHU VSRQWDQHRXVO\ RU DIWHU H[SHULPHQWDO SURYRFDWLRQ +RZHYHU H[WHQGHG
EDFNFURVVLQJ RIWKLV PRXVH OLQH WR WKH 12' PRXVH UHVXOW LQ D VHJUHJDWLRQ RI WKH ,)1Ȗ 5
GHILFLHQW JHQRW\SH IURP WKH GLDEHWHVUHVLVWDQW SKHQRW\SH 7KHVH UHVXOWV LQGLFDWH WKDW WKH
SURWHFWLRQ RI 12' PLFH IURP WKH GHYHORSPHQW RI GLDEHWHV LV QRW GLUHFWO\ OLQNHG WR WKH
GHIHFWLYH ,)1Ȗ5 JHQH EXW UDWKHU LV LQIOXHQFHG E\ WKH SUHVHQFH RI D GLDEHWHVUHVLVWDQW
JHQH V FORVHO\OLQNHGWRWKH,)1Ȗ5ORFLGHULYHGIURPWKHPRXVHVWUDLQ2XWFURVVVWXGLHV
RI 12' PLFH ZLWK VHYHUDO GLIIHUHQW QRQ DXWRLPPXQH SURQH VWUDLQV LQFOXGLQJ % KDYH
LGHQWLILHGPXOWLSOHSRO\PRUSKLFJHQHWLFORFLFRQIHUULQJVXVFHSWLELOLW\RUUHVLVWDQFHWR7\SH
GLDEHWHV



























ϯϮϱ

 &KDSWHU
$QLPDOVIRU+XPDQ+HDOWK3XUSRVHV

,QWURGXFWLRQ

$VJHQHWLFHQJLQHHULQJKDVWKHSRWHQWLDOWRDOWHUWKHXVHVWRZKLFKGRPHVWLFDQLPDOVDUH
SXWLWDOVRFDQOHDGWRIXQGDPHQWDOFKDQJHVLQWKHUHODWLRQVKLSEHWZHHQ  LQGLYLGXDOVRIWKH
VDPHVSHFLHVRUSRSXODWLRQ  GLIIHUHQWVSHFLHV  HQJLQHHUHGDQLPDOVDQGWKHLUSURGXFWV
DQG   WKH SURGXFWV DQG KXPDQV 7KHUH FXUUHQWO\ DUH PDMRU UHVHDUFK HIIRUWV XQGHUZD\ WR
GHYHORSWKHXVHRIJHQHWLFDOO\HQJLQHHUHGDQLPDOVDVVRXUFHVIRUSURGXFWLRQRIQRQWUDGLWLRQDO
PDWHULDOV IRU KXPDQ XVH 6XFK XVHV FDQ EH GLYLGHG LQWR WKUHH PDMRU FDWHJRULHV
ELRSKDUPDFHXWLFDOV IRU DQLPDO RU KXPDQ XVH OLYH FHOOV WLVVXHV DQG RUJDQV IRU
[HQRWUDQVSODQWDWLRQDQGUDZPDWHULDOVIRUSURFHVVLQJLQWRRWKHUXVHIXOHQGSURGXFWV6HYHUDO
SRVVLEOH FRQFHUQV WKDW PLJKW LQ SUDFWLFH DULVH IURP WKH ILUVW WZR XVHV DUH GLVFXVVHG LQ WKH
IROORZLQJVHFWLRQV7KLVFDQEHFDOOHGDV³JHQHSKDUPLQJ´ZKLFKPHDQVWKHXVHRIWUDQVJHQLF
DQLPDOV DQGVRPHWLPHVSODQWV WRSURGXFHPHGLFLQH

%LRSKDUPDFHXWLFDO3URGXFWLRQ

$ ODUJH QXPEHU RI JHQHV HQFRGLQJ XVHIXO SURWHLQ SURGXFWVKRUPRQHV EORRG SURWHLQV
DQG RWKHUV KDV EHHQ LQWURGXFHG LQWR GRPHVWLF DQLPDOV OHDGLQJ WR WKHLU H[SUHVVLRQ LQ PLON
HJJV RU EORRG 7DEOH   6R IDU QRQH RI WKHVH DQLPDOV KDV EHHQ XVHG IRU FRPPHUFLDO
SURGXFWLRQ+RZHYHUDUHFHQWUHSRUWVXJJHVWVWKDWWKHVDPHWHFKQRORJ\PLJKWEHH[WHQGHGWR
WKH ODUJHVFDOH KDYH WKH SRWHQWLDO WR XVH ZHOOHVWDEOLVKHG DJULFXOWXUDO PHWKRGV WR SURGXFH
ODUJH DPRXQWV RI YDOXDEOH SURGXFWV DW UHODWLYHO\ ORZ H[SHQVH DV FRPSDUHG WR IHUPHQWDWLRQ
$OWKRXJKWKHHQGSURGXFWVRIWKHVH DSSOLFDWLRQVZLOOEHQRYHO E\ DQG ODUJH WKHSURFHVV RI
SURGXFWLRQ DQG WKH SRWHQWLDO FRQFHUQV DUH QRW OLNHO\ WR GLIIHU JUHDWO\ IURP WKRVH VHHQ LQ
FXUUHQWSUDFWLFHVXFKDVWKHXVHRIDQLPDOVRUDQLPDOFHOOFXOWXUHVWRSUHSDUHOLYHYDFFLQHV
KRUPRQHVRUWUDGLWLRQDOSURGXFWVVXFKDVPHDWPLONRUOHDWKHU7KHVHVWDQGDUGSURGXFWVDUH
VXEMHFW WR VSHFLILF UHJXODWRU\ SURFHGXUHV DQG HVVHQWLDOO\ WKH VDPH UHJXODWRU\ IUDPHZRUN LV
H[SHFWHG WR DSSO\ IRU SURGXFWV RI ERWK ELRSKDUPLQJ DQG VWDQGDUG WHFKQRORJ\ DV UHJDUGV
FRPPRQ LVVXHV VXFK DV SXULW\ RI WKH ILQDO SURGXFW PLFURELDO FRQWDPLQDWLRQ OHYHOV RI
DGYHQWLWLRXV'1$DQGWKHOLNH1HYHUWKHOHVVDIHZPRUHVSHFLDOL]HGFRQFHUQVDULVH

7DEOH3RWHQWLDOXVHVRIWUDQVJHQLFDQLPDOVIRUSKDUPDFHXWLFDOSURGXFWLRQ
7KHRUHWLFDO<LHOG
6SHFLHV J\URI5DZ3URWHLQ  ([DPSOHVRI3URGXFWV8QGHU'HYHORSPHQW
0RQRFORQDODQWLERGLHV
/\VR]\PH
&KLFNHQ  *URZWKKRUPRQH
  ,QVXOLQ
  +XPDQVHUXPDOEXPLQ
&DOFLWRQLQ
6XSHUR[LGHGLVPXWDVH
5DEELW  (U\WKURSRLHWLQ
  *URZWKKRUPRQH
  ,/
  iJOXFRVLGDVH

ϯϮϲ

 $QWLWKURPELQ,,,
7LVVXHSODVPLQRJHQDFWLYDWRU
*RDW  0RQRFORQDODQWLERGLHV
  i$QWLWU\SVLQ
  *URZWKKRUPRQH
i$QWLWU\SVLQ
6KHHS  )DFWRU9,,,
  )DFWRU,;
  )LEULQRJHQ
+XPDQVHUXPDOEXPLQ
&RZ  /DFWRIHUULQ
  i/DFWDOEXPLQ



&RQWDPLQDWLRQRU6SUHDGRI1RYHO3DWKRJHQV

7KHUH LV D WKHRUHWLFDO SRWHQWLDO IRU PLFURRUJDQLVPV WR DFTXLUHE\ UHFRPELQDWLRQ RU
WUDQVGXFWLRQJHQHVIURPWKHYHFWRUFRQVWUXFWVXVHGWRLQVHUWWKHWUDQVJHQH$OWKRXJKWKHUHLV
QR H[DPSOH \HW RI DFTXLVLWLRQ RI DQ\ JHQH LQFOXGLQJ GUXJ UHVLVWDQFH PDUNHUV E\ EDFWHULDO
IORUDOLYLQJLQDWUDQVJHQLFDQLPDOWKHVSUHDGRILQWURGXFHGJHQHVUHPDLQVDSRVVLELOLW\DOEHLW
UHPRWH

2IJUHDWHUFRQFHUQLVWKHSRVVLELOLW\IRUJHQHUDWLRQRISRWHQWLDOO\SDWKRJHQLFYLUXVHVE\
UHFRPELQDWLRQEHWZHHQVHTXHQFHVRIWKHYHFWRUXVHGWRLQWURGXFHDWUDQVJHQHDQGUHODWHGEXW
QRQSDWKRJHQLF YLUXVHV WKDW PLJKW EH SUHVHQW LQ WKH VDPH DQLPDO 7KHVH FRQFHUQV DUH
SDUWLFXODUO\ DFXWH IRU UHWURYLUDO YHFWRUV 5HWURYLUXVHV DSSHDU WR EH HIILFLHQW YHKLFOHV IRU
LQVHUWLQJ WUDQVJHQHV LQWR PDQ\ VSHFLHV LQFOXGLQJ FKLFNHQV PLFHFDWWOH ILVK DQG VKHOOILVK
DQG PLJKW SURYH PRUH VXFFHVVIXO WKDQ SURQXFOHDU LQMHFWLRQ RI '1$ LQ WKH JHQHUDWLRQ RI
WUDQVJHQLF RIIVSULQJ ,Q PDQ\ VSHFLHV LQFOXGLQJ FKLFNHQV DQG SLJV WKHUH DUH HQGRJHQRXV
SURYLUXVHV LQFOXGLQJ WKH SRUFLQH HQGRJHQRXV YLUXVHV 3(59V GLVFXVVHG EHORZ  WKDW DUH
FRPSHWHQW IRU ORZOHYHO UHSOLFDWLRQ LQ WKH KRVW DQLPDO EXW KDYH QR DSSDUHQW SDWKRJHQLF
FRQVHTXHQFHV(QGRJHQRXVSURYLUXVHVDUH'1$VHTXHQFHVWKDWZHUHGHULYHGIURPLQIHFWLRQ
RIJHUPOLQHFHOOV ZLWKDUHWURYLUXV DQG WKDW DUH WUDQVPLWWHGIURP SDUHQWWR SURJHQ\OLNHDQ\
QRUPDOJHQH7KHLUDWWHQXDWLRQUHODWLYHWRWKHLUH[RJHQRXV SDWKRJHQLFFRXQWHUSDUWV RIWHQ LV
GXH WR GLIIHUHQFHVLQ WUDQVFULSWLRQDO UHJXODWRU\ VHTXHQFHV LQ ORQJ WHUPLQDO UHSHDWV /75¶V 
$VPDQ\YHFWRUVVXFKDVWKHZLGHO\XVHGRQHVGHULYHGIURPPXULQHOHXNHPLDYLUXV 0/9 
KDYH /75 VHTXHQFHV GHULYHG IURP SDWKRJHQLF YLUXVHV WKH SUHVHQFH RI ERWK YHFWRU DQG
HQGRJHQRXVSURYLUXVLQDOOFHOOVRIDWUDQVJHQLFDQLPDOSURYLGHVWKHSRWHQWLDOIRUJHQHUDWLQJ
SDWKRJHQLF UHFRPELQDQW YLUXVHV E\ VWUDLJKWIRUZDUG DQG ZHOO XQGHUVWRRG PHFKDQLVPV 6XFK
FRQFHUQVDUHSDUWLFXODUO\DFXWHLQFKLFNHQVDQGSLJVZKHUHLQIHFWLRXVSURYLUXVHVYHU\VLPLODU
LQVHTXHQFHWRWKRVHXVHGIRUYHFWRUVDUHNQRZQWREHSUHVHQW

,Q PLFH WKHUH LV D ZHOOVWXGLHG PRGHO LQ ZKLFK UHFRPELQDWLRQ EHWZHHQ EHQLJQ
HQGRJHQRXVSURYLUXVHVRUHQGRJHQRXVSURYLUXVHVDQGLQIHFWLQJYLUXVHVHDUO\LQWKHOLIHRIWKH
DQLPDOFDQFDXVHDKLJKLQFLGHQFHRIO\PSKRPD QHDUO\SHUFHQWLQVRPHPRXVHVWUDLQV 
 PRQWKV ODWHU *LYHQ WKLV H[DPSOH LW LV UHDVRQDEOH WR H[SHFW WKDW YLUXVHV RI PXFK JUHDWHU
SDWKRJHQLFLW\ DUH OLNHO\ WR DULVH LQ DQ DQLPDO ZKHQ WKHUH LV D SRVVLELOLW\ RI UHFRPELQDWLRQ
EHWZHHQ YHFWRU DQG HQGRJHQRXV YLUDO VHTXHQFHV 6LPLODU FRQFHUQV DULVH ZLWK WKH XVH RI
ϯϮϳ

YHFWRUVEDVHGRQOHQWLYLUXVHVIRUWKHLQWURGXFWLRQRIJHQHV5HFRPELQDWLRQRIOHQWLYLUXVHVLQ
FLUFXODWLRQLQGRPHVWLFDQLPDOSRSXODWLRQVVXFKDV)HOLQH,PPXQRGHILFLHQF\9LUXV ),9 LQ
FDWV DQG %RYLQH ,PPXQRGHILFLHQF\ 9LUXV %,9  LQ FDWWOH ZLWK YHFWRUV EDVHG RQ +XPDQ
,PPXQRGHILFLHQF\ 9LUXV +,9  LV LPSUREDEOH GXH WR WKH ODUJH JHQHWLF GLVWDQFH EHWZHHQ
WKHP+RZHYHUYHFWRUVEDVHGRQ),9DQG%,9DUHEHLQJGHYHORSHGDQGWKHLUXVHWRLQWURGXFH
WUDQVJHQHV LQWR WKH FRUUHVSRQGLQJ VSHFLHV ZRXOG VLJQLILFDQWO\ LQFUHDVH WKH SUREDELOLW\ RI
JHQHUDWLQJPRUHSDWKRJHQLFUHFRPELQDQWV


(QVXULQJ&RQILQHPHQWRI8QZDQWHG$QLPDOV

$OWKRXJK ELRSKDUP DQLPDOV DUH QRW LQWHQGHG IRU FRQVXPSWLRQ E\ KXPDQV RU RWKHU
DQLPDOVWKHUHDUHJURXQGVIRUFRQFHUQWKDWDGHTXDWHFRQWUROVEHLQSODFHWRHQVXUHWKDWWKLV
GRHVQRWKDSSHQZLWKRXWDSSURSULDWHDSSURYDO

6LQFHWKH\GRQRWFRQWDLQWKHSURGXFWRIWKHLQWURGXFHGJHQHWKHUHPLJKWEHQRVWURQJ
UHDVRQWREHOLHYHWKDWHDWLQJRUXVLQJSURGXFWVIURPWUDQVJHQHFRQWDLQLQJDQLPDOVZRXOGSRVH
DWKUHDWWRKXPDQKHDOWKWKHSRVVLELOLW\RIVXFKDWKUHDWFRPELQHGZLWKWKHODFNRIUHJXODWRU\
RYHUVLJKWIRUVXFKXVHVDUJXHVVWURQJO\IRUFRQILQHPHQWPHDVXUHV

$OWKRXJK LW KDV EHHQ VWDWHG WKDW VXFK DQLPDOV ZLOO EH WRR YDOXDEOH WR WKH RZQHUV WR
DOORZWKHLUPLVDSSURSULDWLRQWKHIDFWWKDWWKHSURGXFWVRILQWHUHVWXVXDOO\DUHSURGXFHGRQO\
E\ ODFWDWLQJ IHPDOHV PHDQV WKDW KDOI WKH WUDQVJHQHFRQWDLQLQJ DQLPDOV HVVHQWLDOO\ ZLOO EH
YDOXHOHVVDVZLOOWKHIHPDOHVDWWKHHQGRIWKHLUSHULRGRIXVHIXOSURGXFWLRQ³1RWDNHV´RU
DQLPDOV JHQHUDWHG IURP PDQLSXODWHG HPEU\RV EXW FXOOHG EHFDXVH RI ODFN DSSURSULDWH
H[SUHVVLRQ RI WKH WUDQVJHQH SURGXFW RU ODFNLQJ WKH WUDQVJHQH LWVHOI  DOVR DUH LQHYLWDEO\
JHQHUDWHGLQVLJQLILFDQWQXPEHUVGXULQJWKHSURGXFWLRQRIWUDQVJHQLFV7KXVFRPSDQLHVXVLQJ
ELRSKDUPDQLPDOVDUHOLNHO\WRVHHNDSSURYDOIRUPDUNHWLQJIRRGRUUHQGHUHGSURGXFWVIURP
VXUSOXVDQLPDOVDQGWKHUHJXODWRU\DJHQFLHVZLOOQHHGWREHUHDG\WRGHDOZLWKVXFKUHTXHVWV
2IJUHDWHUFRQFHUQLVWKHSRVVLELOLW\WKDWVXUSOXVDQLPDOV DQGWKHLUFDUFDVVHV PLJKWWKURXJK
LQDGYHUWHQFHRUWKHIWILQGWKHLUZD\LQWRWKHIRRGRUUHQGHULQJFKDLQRUEHXVHGIRUEUHHGLQJ
WKXV DOORZLQJ XQFRQWUROOHG VSUHDG RI WKH WUDQVJHQH LQWR WKH JHQHUDOSRSXODWLRQ 7KLV ZRXOG
FUHDWHDUHJXODWRU\SUREOHPRIGHDOLQJZLWKXQDSSURYHGWUDQVJHQHVDIWHUWKHLUUHOHDVHLQWRWKH
IRRGFKDLQDSUREOHPDQDORJRXVWRWKDWSRVHGE\WKHDSSHDUDQFHLQIRRGSURGXFWVRI6WDUOLQN
WUDQVJHQLFPDL]HXQDSSURYHGDWWKHWLPHIRUKXPDQFRQVXPSWLRQ


%LRPHGLFDODSSOLFDWLRQV

,Q FRQWUDVW WR JHQHWLF PDQLSXODWLRQ RI IDUP DQLPDOV IRU SURGXFWLRQ WUDLWV WUDQVJHQLF
PDQLSXODWLRQIRUWKHSURGXFWLRQRIKXPDQSKDUPDFHXWLFDOVRUWUDQVSODQWRUJDQV JHQHUDOO\LV
QRWLQWHQGHGWRFDXVHFKDQJHVWKDWKDYHSK\VLRORJLFHIIHFWVRQWKHDQLPDOVWKHPVHOYHV7KXV
DOWKRXJK XQH[SHFWHG DQG XQGHVLUDEOH SKHQRW\SLF HIIHFWV VWLOO FDQ RFFXU DV D UHVXOW RI JHQH
LQVHUWLRQRUFORQLQJWHFKQRORJ\WKHUHJHQHUDOO\DUHIHZHUSRWHQWLDODQLPDOZHOIDUHFRQFHUQV
DVVRFLDWHGZLWKWKHSURGXFWLRQ RI WUDQVJHQLFIDUP DQLPDOV IRUELRPHGLFDO SXUSRVHV WKDQIRU
DJULFXOWXUDOSXUSRVHV

3KDUPDFHXWLFDOV


ϯϮϴ

 $OWKRXJKWKHUHLVDSRWHQWLDOIRUSURGXFLQJSKDUPDFHXWLFDOVLQWKHHJJVEORRGXULQHRU
VSHUPRIIDUPDQLPDOVWKHPRVWFRPPRQPHWKRGLVWRSURGXFHWUDQVJHQLFFDWWOHRUJRDWVWKDW
H[SUHVVWKHSURWHLQRILQWHUHVWLQPDPPDU\WLVVXH7KHUHFRPELQDQWSURWHLQWKHQLVVHFUHWHGLQ
PLON ZKHQ WKH IHPDOH ODFWDWHV 7KLV SRVHV SUREOHPV PDLQO\ ZKHQ WKRVH SURWHLQV HLWKHU DUH
H[SUHVVHGLQQRQPDPPDU\WLVVXHV VRFDOOHGHFWRSLFH[SUHVVLRQ RUZKHQWKH\³OHDN´RXWRI
WKHPDPPDU\JODQGLQWRWKHFLUFXODWLRQ,IWKHSURWHLQLVDFWLYHELRORJLFDOO\LQWKHVSHFLHVLQ
ZKLFK LW LV SURGXFHG LW FDQ FDXVH SDWKRORJLHV DQG RWKHU VHYHUH V\VWHPLF HIIHFWV 5LJRURXV
UHJXODWLRQ RI WKH H[SUHVVLRQ RI WKH WUDQVJHQH WKXV LV QHFHVVDU\ WR HQVXUH WKDW WKH DQLPDO
ZHOIDUH FRQVHTXHQFHV RI PLONERUQH SKDUPDFHXWLFDO SURGXFWLRQ DUH PLQLPL]HG EXW VXFK
UHJXODWLRQFXUUHQWO\LVGLIILFXOWWRDFKLHYH+RZHYHUHYHQZKHQDSKDUPDFHXWLFDOLVFRQILQHG
WR WKH PDPPDU\ WLVVXH WKH H[SUHVVLRQ RI SDUWLFXODU SURWHLQV KDV EHHQ DVVRFLDWHG ZLWK
SUHPDWXUH ODFWDWLRQDO VKXWGRZQ LQ JRDWV DQG SLJV ,Q SLJV WKHUH ZDV HYLGHQFH WKDW WKH
PDPPDU\ WLVVXH GHYHORSHG DEQRUPDOO\ GXH WR SUHPDWXUH H[SUHVVLRQ RI WKH WUDQVJHQH DQG
WKDWWKHFRQGLWLRQRIWKHPDPPDU\JODQGPLJKWKDYHFDXVHGODFWDWLRQWREHSDLQIXO6LPLODU
FRQFHUQV DULVH LQ WKH FDVH RI EORRG ERUQH SURWHLQV DQG QXWUDFHXWLFDOV VHH EHORZ  LI WKH
SURGXFWVDUHSURGXFHGDWOHYHOVKLJKHUWKDQWKHDQLPDO¶VQRUPDOSK\VLRORJLFOHYHOV


2WKHU%LRPHGLFDO$SSOLFDWLRQV

)DUPDQLPDOVPLJKWEHJHQHWLFDOO\HQJLQHHUHGIRUKXPDQELRPHGLFDODSSOLFDWLRQVRWKHU
WKDQ [HQRWUDQVSODQWDWLRQ RU WKH SURGXFWLRQ RI SKDUPDFHXWLFDOV 5HVHDUFK LV XQGHUZD\ IRU
H[DPSOH WR SURGXFH D SRUFLQH PRGHO RI F\VWLF ILEURVLV DQG WKHUH DOUHDG\ DUH IDUP DQLPDO
PRGHOV IRU UHWLQDO GHJHQHUDWLRQ DQG QHXURGHJHQHUDWLYH GLVHDVH $V JHQHWLF HQJLQHHULQJ
WHFKQLTXHVIRUIDUPDQLPDOV LPSURYHSDUWLFXODUO\ VXFK WKDW VLQJOH EDVH FRGLQJ FKDQJHV WKDW
DUHW\SLFDORIPDQ\KXPDQJHQHWLFGLVHDVHVFDQEHLQWURGXFHGDQGWKHSURGXFWLRQDQGXVHRI
IDUP DQLPDO PRGHOV EHFRPHV PRUH HFRQRPLFDOO\ IHDVLEOHLW LV OLNHO\ WKDW PRUH PRGHOV IRU
GLVHDVH UHVHDUFK DQG WR[LFLW\ WHVWLQJ ZLOO EH GHYHORSHG 'LVFXVVLRQ RI WKH SRWHQWLDO LVVXHV
UDLVHGE\WKHVHELRPHGLFDOXVHVRIIDUPDQLPDOVLVRXWVLGHWKHVFRSHRIWKLVUHSRUW+RZHYHU
WKH ZHOIDUH LPSOLFDWLRQV ZLOO GHSHQG XSRQ VSHFLILF IHDWXUHV RI WKH PRGHO XQGHU VWXG\
LQFOXGLQJ DQ\ XQDOOHYLDWHG SDLQ DQG VXIIHULQJ DVVRFLDWHG ZLWK WKH GLVHDVH SURFHVV LWVHOI DV
ZHOODVWKHQHHGIRUVSHFLDOL]HGKXVEDQGU\DQGYHWHULQDU\FDUHUHTXLUHPHQWV

;HQRWUDQVSODQWDWLRQ

;HQRWUDQVSODQWDWLRQGLIIHUVIURPRWKHUXVHVRIJHQHWLFDOO\HQJLQHHUHGDQLPDOVLQWKDWLW
KDV WKH SRWHQWLDO WR FUHDWH VRPHWKLQJ HQWLUHO\ QHZSHUPDQHQW KXPDQ±DQLPDO FKLPHUDVLQ
ZKLFKFHOOVRI GLVWDQWO\UHODWHG VSHFLHVVXUYLYH DQG IXQFWLRQIRUORQJ SHULRGVRIWLPHLQWKH
PRVW LQWLPDWH FRQWDFW SRVVLEOH *LYHQ LWV SRWHQWLDO IRU DOOHYLDWLQJ KXPDQ GLVHDVHV GXH WR
LUUHYHUVLEOHWLVVXHRURUJDQIDLOXUH 7DEOH DQGJLYHQWKHDFXWHVKRUWDJHRIKXPDQRUJDQV
IRU WUDQVSODQW WKHUH DUH YHU\ DFWLYH UHVHDUFK SURJUDPV XQGHUZD\ LQ ERWK FRPPHUFLDO DQG
DFDGHPLFODERUDWRULHVWRRYHUFRPHWKHVLJQLILFDQWLPPXQRORJLFDQGSK\VLRORJLFEDUULHUVDQG
WKHUHE\WREULQJ[HQRWUDQVSODQWDWLRQLQWRVWDQGDUGPHGLFDOSUDFWLFH

$WSUHVHQWWKHRQO\DQLPDOXQGHUVHULRXVFRQVLGHUDWLRQDVD[HQRWUDQVSODQWGRQRULVWKH
SLJ)RUUHJXODWRU\SXUSRVHVKXPDQFHOOVFXOWXUHGH[YLYRZLWKWKHFHOOVRIDQ\RWKHUDQLPDO
VXFKDVPRXVHFHOOOLQHVDOVRDUHFRQVLGHUHGWREH[HQRWUDQVSODQWVFRFXOWLYDWLRQZLWKPRXVH
FHOOOLQHVKDVEHHQXVHGLQWKHSUHSDUDWLRQRIVRPHFXOWXUHGVNLQJUDIWVDVZHOODVKXPDQVWHP
FHOO OLQHV :KLOH QRQKXPDQ SULPDWHVVXFK DV WKH EDERRQ ZRXOG VHHPWR KDYH SK\VLRORJLF
DQG LPPXQRJHQHWLF DGYDQWDJHV VXFK DV WKH ODFN RI D K\SHUDFXWH LPPXQH UHVSRQVH WKHLU

ϯϮϵ

VFDUFLWLHVDVZHOODVWKHGLIILFXOW\RIFOHDULQJWKHPRIDGYHQWLWLRXVLQIHFWLRXVDJHQWV DVZHOO
DVHWKLFDOFRQFHUQV UHQGHUWKHPLPSUDFWLFDOIRUIXUWKHUFRQVLGHUDWLRQ

7DEOH$SSOLFDWLRQVRI[HQRWUDQVSODQWDWLRQ
,QGLFDWLRQ 7UDQVSODQW 6WDWXV
2UJDQ)DLOXUH 3LJKHDUWNLGQH\OLYHUHWF 
$FXWHOLYHUIDLOXUH ([WUDFRUSRUHDOSHUIXVLRQ 
'LDEHWHV 3DQFUHDWLFLVOHWV RUFHOOV  
3DUNLQVRQ¶VGLVHDVH
+XQWLQJWRQ¶V'LVHDVH)RFDO 1HXUDOWLVVXH 
HSLOHSV\6WURNH  
%XUQ6NLQLQMXU\ 6NLQDXWRJUDIW FRFXOWXUHG
 ZLWKPRXVHFHOOV  
1RWH
1RVXFFHVVIXOH[SHULHQFH
6RPHWULDOVKDYHEHHQSHUIRUPHG
6XFFHVVIXOWULDOVKDYHEHHQSHUIRUPHG

7KH ILHOG RI [HQRWUDQVSODQWDWLRQ FRYHUV D JUHDW PDQ\ SURFHGXUHV UDQJLQJ IURP
LPSODQWDWLRQRIVLQJOHFHOOVWRWUHDW3DUNLQVRQ¶VGLVHDVHDQGWLVVXHVVXFKDVSDQFUHDWLFLVOHWV
WR WUHDW GLDEHWHV H[WUDFRUSRUHDO XVH RI LQWDFW RUJDQV VXFK DV SHUIXVLRQ RI SDWLHQW EORRG
WKURXJKSLJOLYHUVWRSURYLGHVKRUWWHUPVXSSRUWLQFDVHVRIOLYHUIDLOXUHWRWUDQVSODQWDWLRQRI
ZKROHRUJDQVKHDUWNLGQH\OLYHUDQGVRRQ:KLOHZKROHRUJDQ[HQRWUDQVSODQWDWLRQUHPDLQV
IDULQWKHIXWXUHGHYHORSPHQWRIWKHVLPSOHUPRGDOLWLHVLVXQGHUZD\DQGKXQGUHGVRIKXPDQ
VXEMHFWVKDYHUHFHLYHGSRUFLQHFHOOVRUWLVVXHV DV SDUW RIFOLQLFDOWULDOVLQWKH8QLWHG6WDWHV
5XVVLD ,VUDHO DQGPDQ\ (XURSHDQ FRXQWULHV *LYHQWKH QDWXUH RI LQIHFWLRXV GLVHDVH LVVXHV
UHJXODWRU\FRQFHUQVDUHQRWOLPLWHGWRWKH8QLWHG6WDWHVDORQHEXWH[WHQGWRWKHLQWHUQDWLRQDO
KHDOWKFRPPXQLW\DVZHOO

7KH GHYHORSPHQW RI [HQRWUDQVSODQWDWLRQ DV D SDUW RI FOLQLFDO SUDFWLFH SURPLVHV JUHDW
EHQHILWVLQWHUPVRIPDNLQJSRVVLEOHHVVHQWLDOO\LQILQLWHVXSSOLHVRIUHSODFHPHQWWLVVXHVDQG
RUJDQVZKHUHVHYHUHVKRUWDJHVH[LVWWRGD\7KLVGHYHORSPHQWQDWXUDOO\ZLOOHQWDLOERWKJUHDW
SRWHQWLDO EHQHILW DV ZHOO DV FRQVLGHUDEOH ULVN WR WKH VWXG\ SDUWLFLSDQW EXW VXFK ULVN LV QRW
TXDOLWDWLYHO\ GLIIHUHQW IURP WKDW HQWDLOHG LQ WKH GHYHORSPHQW RI DQ\ RWKHU QHZ PHGLFDO
SURFHGXUHDQGZLOOQRWEHFRQVLGHUHGIXUWKHU7KHSULQFLSDOFRQFHUQLVWKDWWKHXQLTXHO\FORVH
UHODWLRQVKLS FUHDWHG EHWZHHQ UHFLSLHQW DQG KRVW ZLOO DOORZ QRYHO RSSRUWXQLWLHV IRU
WUDQVPLVVLRQRILQIHFWLRXVGLVHDVHDQGSRVVLEOHFUHDWLRQRIQHZGLVHDVHDJHQWVLQWKHSURFHVV
:KLOH WKH KLVWRU\ RI FORVH FRQWDFW EHWZHHQ KXPDQV DQG SLJV LV D YHU\ ORQJ RQH DQG RQH
ZRXOG LPDJLQH WKDW DOO SRVVLEOH WUDQVPLVVLRQ RI LQIHFWLRXV DJHQWV EHWZHHQ WKH WZR VSHFLHV
DOUHDG\ ZRXOG KDYH EHHQ VHHQ DQG WKRURXJKO\ VWXGLHG LW LV SRVVLEOH WKDW WKH ³FRFXOWXUH´
HQYLURQPHQW RI D WUDQVSODQW ZRXOG EH TXDOLWDWLYHO\ GLIIHUHQW LQ ZD\V WKDW ZRXOG DOORZ
GLIIHUHQWRXWFRPHV


,QDQDWWHPSWWRSUHYHQWK\SHUDFXWHUHMHFWLRQRISLJRUJDQVE\KXPDQVSLJVKDYHEHHQ
PDGH WUDQVJHQLF IRU WKH H[SUHVVLRQ RI KXPDQ FRPSOHPHQW SURWHLQV ZKLFK DUH LQYROYHG LQ
UHJXODWLRQRIWKHLPPXQHUHVSRQVH1RSKHQRW\SLFDEQRUPDOLWLHVKDYHEHHQUHSRUWHGLQSLJV
DV D UHVXOW RI WKH H[SUHVVLRQ RI WUDQVJHQHV IRU WKHVH KXPDQ SURWHLQV DOWKRXJK EHFDXVH WKH
SLJVDUHSURGXFHGE\PLFURLQMHFWLRQWKHUHDUHWKHXVXDOLQHIILFLHQFLHVLQWHUPVRIWKHQXPEHU

ϯϯϬ

RI HPEU\RV PLFURLQMHFWHG UHODWLYH WR WKH QXPEHU RI WUDQVJHQLF DQLPDOV ERUQ 5HVHDUFK LV
XQGHUZD\ WR SURGXFH SLJV WKDW LQ DGGLWLRQ WR FDUU\LQJ FRPSOHPHQW WUDQVJHQHV KDYH ERWK
FRSLHVRIWKHJHQHHQFRGLQJWKHHQ]\PHWKDWSURGXFHVWKHDQWLJHQDVVRFLDWHGZLWKUHMHFWLRQ
NQRFNHG RXW 7KH DQLPDO ZHOIDUH LPSOLFDWLRQV RI WKLV JHQHWLF PDQLSXODWLRQ DUH XQNQRZQ
KRZHYHUWKHNQRFNRXWZKLFKFDXVHVFKDQJHVLQFHOOXODUFDUERK\GUDWHVWUXFWXUHSRWHQWLDOO\
FRXOG KDYH GHOHWHULRXV SK\VLRORJLF HIIHFWV RQ WKH DQLPDOV DQG UHQGHU WKHP VXVFHSWLEOH WR
LQIHFWLRQZLWKKXPDQYLUXVHV

$QLPSRUWDQWDQLPDOZHOIDUHFRQFHUQUHODWHGWR[HQRWUDQVSODQWDWLRQLVWKHPDQDJHPHQW
DQG KRXVLQJ RI SLJV LQWHQGHG IRU XVH DV RUJDQ VRXUFHV 7R PLQLPL]H WKH SRWHQWLDO IRU
WUDQVPLVVLRQRIGLVHDVHWRKXPDQUHFLSLHQWVRQO\VSHFLILFSDWKRJHQIUHH 63) SLJVDUHXVHG
63) UHVHDUFK DQLPDOV DUH XVHG LQ RWKHU FRQWH[WV EHVLGHV [HQRWUDQVSODQWDWLRQ EXW WKHLU XVH
UDLVHVVHYHUDODQLPDOZHOIDUHLVVXHV63)SLJVDUHERUQE\K\VWHURWRP\RUK\VWHUHFWRP\DQG
WKHQ DUH UHDUHG LQ LVRODWRUV IRU  GD\V EHIRUH EHLQJ SODFHG LQ WKH VRXUFH KHUG RU LQ WKH
[HQRWUDQVSODQWDWLRQIDFLOLW\7KHQDWXUDOZHDQLQJDJHIRUSLJVLVDERXWHLJKWZHHNV WKUHHWR
IRXU ZHHNV LQ FRPPHUFLDO SUDFWLFH  DQG SLJOHWV VXEMHFWHG WR H[WUHPHO\ HDUO\ ZHDQLQJ OLNH
WKLV DUH NQRZQ WR GHYHORS DEQRUPDO EHKDYLRXUV 2OGHU SLJV LQWHQGHG IRU WHVWLQJ RU RUJDQ
GRQDWLRQ PLJKW EH KRXVHG LQ VRFLDO LVRODWLRQ LQ XQXVXDOO\ EDUUHQ LH HDVLO\ VDQLWL]DEOH 
HQYLURQPHQWV3LJVDUHH[WUHPHO\VRFLDODQLPDOVWKDWZKHQJLYHQWKHRSSRUWXQLW\ZLOOVSHQG
FRQVLGHUDEOHWLPHHDFKGD\IRUDJLQJDQGWKDWGHYHORSDEQRUPDOEHKDYLRUVLQFRQILQHPHQWLI
QRW JLYHQ WKH RSSRUWXQLW\ WR URRW RU EXLOG QHVWV ,Q WKH 8QLWHG .LQJGRP IRU RUJDQVRXUFH
SLJV ZKLOH UHFRJQL]LQJ WKH LPSRUWDQFH RI PDLQWDLQLQJ ELRVHFXUH IDFLOLWLHV QHYHUWKHOHVV
UHFRPPHQGV WKDW VXFK SLJV EH KRXVHG LQ VWDEOH VRFLDO JURXSV DQG SURYLGHG ZLWK
HQYLURQPHQWDO HQULFKPHQW VXFK DV VWUDZ RU RWKHU PDWHULDO VXLWDEOH IRU PDQLSXODWLRQ 7KH
&RGH UHTXLUHV MXVWLILFDWLRQ LI WKH DQLPDOV¶ EHKDYLRUDO QHHGV DUH WR EH FRPSURPLVHG IRU D
[HQRWUDQVSODQWDWLRQ SURWRFRO 7KHUH DUH QR FRPSDUDEOH VWDQGDUGV IRU SLJV LQWHQGHG IRU
[HQRWUDQVSODQWDWLRQLQWKH86DQGWKHODFNRIVWDQGDUGL]DWLRQ RI KRXVLQJ DQG FDUH DPRQJ
86IDFLOLWLHVIRUWKHVHSLJVLVDVRXUFHRIFRQFHUQ

$OWKRXJK WKHUH DUH PDQ\ IRUPV RI HQYLURQPHQWDO HQULFKPHQW DYDLODEOH WKRVH DUH
VXLWDEOH IRU ODERUDWRU\KRXVHG SLJV DSSURSULDWH PHWKRGV IRU RUJDQVRXUFH SLJV UHTXLUH
GHYHORSPHQWDQGHYDOXDWLRQ

([RJHQRXV,QIHFWLRXV$JHQWV
,Q JHQHUDO EDFWHULD DQG SDUDVLWHV WKDW PLJKW FDXVH SUREOHPV UHDGLO\ FDQ EH H[FOXGHG
IURPVRXUFHIORFNVOHDYLQJYLUXVHVDVWKHSULQFLSDOFRQFHUQ$VFDQEHVHHQLQ7DEOHWKH
QXPEHURIYLUDODJHQWVWKDWDUHRISRWHQWLDOFRQFHUQLVYHU\ODUJH1RWDOORIWKHYLUXVHVDUHRQ
WKHOLVWEHFDXVHRIWKHLUSRWHQWLDOWRFDXVHKXPDQGLVHDVHVRPHZRXOGFDXVHVHULRXVGLVHDVH
DPRQJWKHGRQRUDQLPDOVDQGRWKHUVDUHVHQVLWLYHLQGLFDWRUVRIEUHDNVLQELRVHFXULW\DQGVR
IRUWK ,Q SULQFLSOH EHFDXVH DOO RI WKHVH DJHQWV DUH KRUL]RQWDOO\ RQH DQLPDO WR DQRWKHU  RU
YHUWLFDOO\ PRWKHUWRRIIVSULQJ WUDQVPLWWHGWKH\ FDQEHHOLPLQDWHGE\SURSHUPDQDJHPHQW
SURSHUFRQWDLQPHQWYDFFLQDWLRQFORVHPRQLWRULQJFXOOLQJELUWKE\&DHVDULDQVHFWLRQHWF,Q
SUDFWLFHHOLPLQDWLRQLVJRLQJWRSURYHDYHU\GLIILFXOWWDVNEHFDXVHWKHQXPEHUVRIDJHQWVDUH
YHU\ ODUJH DQG WKHUH LV D ODFN RI UHOLDEOH DVVD\V IRU GHWHFWLQJ PDQ\ RI WKHP 1HYHUWKHOHVV
SUREOHPV UHVXOWLQJ IURP WUDQVPLVVLRQ RI H[RJHQRXV LQIHFWLRXV DJHQWV DUH QRW TXDOLWDWLYHO\
GLIIHUHQWIURPWKHSUHVHQWVLWXDWLRQZLWKKXPDQGRQRUV DOORWUDQVSODQWDWLRQ ZKHUHLQIHFWLRQ
ZLWK DJHQWV WUDQVPLWWHG ZLWK WKH WUDQVSODQWHG RUJDQ VXFK DV (SVWHLQ±%DUU YLUXV DQG
F\WRPHJDORYLUXV  LV D PDMRU SUREOHP ,Q IDFW LW LV DQWLFLSDWHG WKDW UHGXFWLRQ LQ WKH ULVN RI
DFXWH PRUELGLW\ DQG PRUWDOLW\ UHVXOWLQJ IURP WKH WUDQVPLVVLRQ RI LQIHFWLRXV DJHQWV ZLWK
WUDQVSODQWHGRUJDQVZLOOEHDVLJQLILFDQWEHQHILWRI[HQRWUDQVSODQWDWLRQ

ϯϯϭ

 7DEOH([RJHQRXVSLJYLUXVHVRIFRQFHUQLQ[HQRWUDQVSODQWDWLRQ
)DPLO\ 6SHFLHV &DWHJRU\
)RRWDQGPRXWKGLVHDVH 
(QWHURYLUXV7DOIDQ7HVFKHQ 
(QWHURYLUXV RWKHUVHURJURXSV  
(QWHURYLUXVVZLQHYHVLFXODUGLVHDVH 
+XPDQHQWHURYLUXVHV 
(QFHSKDORP\RFDUGLWLV 
3LFRUQDYLULGDH 5KLQRYLUXV 
(QWHULFFDOLFLYLUXV 
&DOLFLYLULGDH 6ZLQHKHSDWLWLV( 
$VWURYLULGDH 3RUFLQHDVWURYLUXV 
:HVWHUQHQFHSKDOLWLV 
(DVWHUQHQFHSKDOLWLV 
7RJDYLULGDH 9HQH]XHODQHQFHSKDOLWLV 
 *HWDK 
 &KLNXQJXQ\D 
-DSDQHVH%HQFHSKDOLWLV 
/RXSLQJ,OO7%(FRPSOH[ 
:HVVOHEURQGLVHDVH 
$SRL 
)ODYLYLULGDH
'HQJXHIHYHU 

 :HVW1LOHIHYHU 
 &ODVVLFDOVZLQHIHYHU KRJFKROHUD  
 %RYLQHYLUDOGLDUUKRHD 
 %RUGHUGLVHDVH 
7UDQVPLVVLEOHJDVWURHQWHULWLV 
3RUFLQHUHVSLUDWRU\FRURQDYLUXV 
(SLGHPLFGLDUUKHD 
&RURQDYLULGDH +DHPDJJOXWLQDWLQJHQFHSKDORP\HOLWLV 
 3RUFLQHUHSURGXFWLYH UHVSLUDWRU\GLVHDVH
 V\QGURPH 
 3RUFLQHWRURYLUXV 
0XULQHSDUDLQIOXHQ]DYLUXVW\SH 6HQGDL  
3DUDLQIOXHQ]D 
3DUDP\[RYLULGDH 3DUDLQIOXHQ]D 
 %OXHH\HGLVHDVH 
 0HQDQJOH 
 1LSDK 
6ZLQHSR[ 
3R[YLULGDH 9DFFLQLD 
 &RZSR[ 
 2UISVHXGRFRZSR[ 
'HVR[\YLULGDH $IULFDQVZLQHIHYHU 


ϯϯϮ

1RWH
 =RRQRWLF
 5HSOLFDWHVLQKXPDQFHOOVRUZHDNHYLGHQFHIRU]RRQRWLFSRWHQWLDO
 0LJKWXQGHUJRDERUWLYHUHSOLFDWLRQDQGSRVVLEO\RQFRJHQLFUHSOLFDWLRQ
 %HORQJVWRDIDPLO\ZLWKHYLGHQFHRIIUHTXHQWFKDQJHVLQKRVWUDQJHRUSDWKRJHQLFLW\
 8QGHVLUDEOHDVLQGLFDWHVDEUHDNGRZQLQELRVHFXULW\DQGRUPLJKWFRPSURPLVHKHDOWKRI
WKHSLJV

3RUFLQH(QGRJHQRXV5HWURYLUXVHV

3(59V SUHVHQW TXLWH D GLIIHUHQW VLWXDWLRQ DQG OHYHO RI FRQFHUQ EHFDXVH WKH\ DUH
LQKHULWHG DV SDUW RI WKH KRVW JHQRPH DQG WKHUHIRUH FDQQRW EH UHPRYHG HDVLO\ IURP GRQRU
DQLPDOV $OO SLJV FRQWDLQ PXOWLSOH DURXQG   3(59 SURYLUXVHV LQ WKHLU JHQRPH DW OHDVW
VHYHUDO RI ZKLFK HQFRGH LQIHFWLRXV YLUXV 3(59V DUH JDPPDUHWURYLUXVHV FORVHO\ UHODWHG WR
0/9ZKLFKFDQEHFODVVLILHGLQWRWKUHHVXEW\SHV$%DQG&EDVHGRQWKHLUHQYHORSHJHQH
VHTXHQFHV6XEW\SHV$DQG%FDQLQIHFWPDQ\W\SHVRIKXPDQFHOOVLQFXOWXUH6XEW\SH&LV
PXFK OHVV LQIHFWLRXV IRU KXPDQV 0RVW EUHHGV RI SLJ FDUU\ SURYLUXVHV FDSDEOH RI \LHOGLQJ
LQIHFWLRXV YLUXV RI DOO WKUHH VXEW\SHV $OWKRXJK PRVW SLJV FDUU\ DERXW WKH VDPH QXPEHU RI
SURYLUXVHV LQ WKHLU '1$ WKHUH LV FRQVLGHUDEOH GLYHUVLW\ LQ ORFDWLRQ LPSO\LQJ WKDW WKHLU
LQVHUWLRQLQWRWKHJHQRPHPXVWKDYHRFFXUUHGUDWKHUUHFHQWO\ RQDQHYROXWLRQDU\WLPHVFDOH 
%DVHGRQH[WHQVLYHH[SHULHQFHZLWKUHODWHGHQGRJHQRXVSURYLUXVHVRIPLFHLWLVKLJKO\OLNHO\
WKDW WKH PDMRULW\ RI SURYLUXVHV FRQWDLQ VRPH VRUW RI JHQHWLF GHIHFW DQG WKDW RQO\ D VPDOO
QXPEHUDUHUHVSRQVLEOHIRUUHOHDVHRILQIHFWLRXVYLUXV7DNHQWRJHWKHUZLWKWKHSRO\PRUSKLVP
LQWKHSUHVHQFHRUDEVHQFHRIVSHFLILFSURYLUXVHVLWPLJKWZHOOEHSRVVLEOHWREUHHGDQLPDOV
ODFNLQJLQIHFWLRXVSURYLUXVHVIRUXVHDV[HQRWUDQVSODQWGRQRUV

3(59VKDYHQRW\HWEHHQVKRZQWRFDXVHGLVHDVH RUHYHQYLUHPLD LQSLJVRUDQ\RWKHU
VSHFLHV LQ ZKLFK WKH\ KDYH EHHQ GHWHFWHG 1RU KDV WKHLU SUHVHQFH EHHQ GHWHFWHG E\
SRO\PHUDVHFKDLQUHDFWLRQ3&5RUVHURORJ\ LQPRUHWKDQKXPDQUHFLSLHQWVRISLJFHOOV
RU WLVVXHV DOWKRXJK D ORZ OHYHO RI LQIHFWLRQ RI UHFLSLHQW FHOOV FDQ EH REVHUYHG LQ
LPPXQRGHILFLHQWPLFHWUDQVSODQWHGZLWKSRUFLQHLVOHWVRI/DQJHUKDQV1HYHUWKHOHVVJLYHQWKH
UHOHDVHRIYLUXVHVLQIHFWLRXVWRKXPDQFHOOVE\PDQ\W\SHVRISLJFHOOVWKHFORVHVLPLODULW\RI
WKHVHYLUXVHVWRYLUXVHVNQRZQWRFDXVHFDQFHULPPXQRGHILFLHQF\DQGRWKHUGLVHDVHVLQPLFH
DQGFDWVWKHZHOONQRZQDGDSWDELOLW\DQGYDULDELOLW\RIUHWURYLUXVHVDQGWKHH[DPSOHRIWKH
UDSLGZRUOGZLGHVSUHDGRI+,9DQG$,'6WKHUHLVVHULRXVFRQFHUQWKDWWKHQRYHODVVRFLDWLRQ
EHWZHHQSLJDQGKXPDQWLVVXHV PLJKWFUHDWHQRYHOHYROXWLRQDU\ RSSRUWXQLWLHVIRUWKH YLUXV
OHDGLQJWRWKHDSSHDUDQFHRIDQHZSDWKRJHQ

$OWKRXJKVXFKDSDWKRJHQFRXOGKDYHVHULRXVORQJWHUPDGYHUVHFRQVHTXHQFHVIRUWKH
WUDQVSODQWUHFLSLHQWWKLVLVVXHLV QRWDQDUHDRIFRQFHUQ EHFDXVH LW LVIDURXWZHLJKHG E\ WKH
SRWHQWLDOEHQHILWVRIWKHWUDQVSODQW7KHUHDOLVVXHRIFRQFHUQLVWKDWWKH[HQRWUDQVSODQWVHWWLQJ
PLJKW SURYLGH WKH RSSRUWXQLW\ IRU WKH YLUXV WR HYROYH LQWR D SDWKRJHQ WKDW DOVR FRXOG EH
WUDQVPLWWHG IURP RQH LQGLYLGXDO WR DQRWKHU HIILFLHQWO\ HQRXJK WR FUHDWH D QHZ HSLGHPLF
GLVHDVH

,WLVYLUWXDOO\FHUWDLQWKDWPDQ\FHOOV LQWKHWUDQVSODQWZRXOGH[SUHVVLQIHFWLRXV3(59
IROORZLQJWUDQVSODQWDWLRQDQGLWHYHQWVQHFHVVDU\IRUJHQHUDWLRQRISDWKRJHQLFWUDQVPLVVLEOH
YLUXVHV LQFUHDVLQJO\ DUH XQOLNHO\ EXW RQ VRPH XQNQRZQ DUELWUDU\ VFDOH $OWKRXJK WKH
SUREDELOLW\ RI LQDGYHUWHQW FUHDWLRQ RI D QHZ HSLGHPLF JHQHUDOO\ LV MXGJHG WR EH H[WUHPHO\
VPDOO SDUWLFXODUO\JLYHQWKHORQJKLVWRU\RILQWLPDWHDVVRFLDWLRQEHWZHHQKXPDQVDQGSLJV LW

ϯϯϯ

FDQQRW EH LJQRUHG DOWRJHWKHU &XUUHQW )'$ SROLF\ LV WR SHUPLW [HQRWUDQVSODQWDWLRQ WULDOV WR
SURFHHG EXW WR UHTXLUH FORVH PRQLWRULQJ RI UHFLSLHQWV DQG LQVRIDU DV SRVVLEOH  RI WKHLU
FRQWDFWV $WWHPSWV DOVR DUH EHLQJ PDGH WR LGHQWLI\ VSHFLILF SURYLUXVHV UHVSRQVLEOH IRU
SURGXFWLRQRILQIHFWLRXVYLUXVDQGWKHQWRVHOHFWLYHO\EUHHGWKHPRXWRIOLQHVRIDQLPDOVWREH
XVHGDVWUDQVSODQWGRQRUV

)RRGSURGXFWVIURP1RQJHQHWLFDOO\FORQHGDQLPDOV

7KH FORQLQJ WHFKQRORJLHV RI HPEU\R VSOLWWLQJ DQG EODVWRPHUH QXFOHDU WUDQVIHU XVLQJ
HPEU\R FHOOV ZHUH LQWURGXFHG LQWR GDLU\ FDWWOH EUHHGLQJ LQ WKH V $OWKRXJK QRW ZLGHO\
DGRSWHG D WRWDO RI  (06 FORQHG +ROVWHLQ IHPDOHV ZDV UHJLVWHUHG ZLWK WKH $PHULFDQ
+ROVWHLQ $VVRFLDWLRQ WKURXJK DQG HYDOXDWHG JHQHWLFDOO\ IRU \LHOG WUDLWV PHDQLQJ WKH\
SURGXFHGFDOYHVDQGZHUHPLONHGFRPPHUFLDOO\

<LHOGVRIIHPDOH(06FORQHVZHUHJUHDWHUWKDQWKRVHRIWKH+ROVWHLQSRSXODWLRQE\
NJPLONNJIDWDQGNJSURWHLQEXWVOLJKWO\OHVVWKDQWKRVHRIQRQFORQHGIXOOVLEOLQJV7KH
ODWWHUUHVXOWPLJKWLQGLFDWHDQLPSDFWRIWKHWHFKQRORJ\RQSHUIRUPDQFHRUVOLJKWO\GLIIHUHQW
PDQDJHPHQWRIWKHWZRJURXSV2I(06FORQHGEXOOVUHJLVWHUHGDQGHYDOXDWHGE\WKH
86'HSDUWPHQWRI$JULFXOWXUH 86'$ DVVRXUFHVRIGRQRUVSHUPRQO\KDGQRQFORQHG
IXOOVLEOLQJV5HVXOWVRIWKHHYDOXDWLRQVRIWKHVLUHVDUHQRW\HWDYDLODEOH$WRWDORI%17
FORQHG+ROVWHLQV PDOHVDQGIHPDOHV ZHUHUHJLVWHUHGWKURXJK  1RUPDQ HW DO
   KDG PLON \LHOG UHFRUGV EXW RQO\  KDG QRQFORQHG IXOO VLEOLQJV 7KH \LHOGV DQG
PLONFRPSRVLWLRQRI%17FORQHVH[FHHGHGWKRVHRIWKHQDWLRQDOKHUGDYHUDJHE\NJPLON
 NJ IDW DQG  NJ SURWHLQ EXW ZHUH VLPLODU WR WKRVH RI WKHLU QRQFORQHG IXOO VLEOLQJV
$OWKRXJK H[LVWLQJ GDWD IRU (06 DQG %17 FORQHV DGGUHVVHV WKH FKDQJHV LQ PLON \LHOG DQG
FRPSRVLWLRQWKH\GRQRWVSHFLILFDOO\DGGUHVVWKHIRRGVDIHW\RIWKHLUPLONDQGPHDWSURGXFWV
$VLGH IURP D VWXG\ RQ \HDUOLQJ %UDQJXV EXOOV WKDW FRPSDUHG ERG\ PHDVXUHPHQWV DQG
PHDVXUHVRIFDUFDVVPHULWREWDLQHGIURPWKHLUVWHHUFORQHPDWHV 'LOHVHWDO WKHUHDUH
QR SXEOLVKHG DQDO\WLFDO VWXGLHV RI PHDW DQG PLON FRPSRVLWLRQ FRPSDULQJ WKH SURGXFWV RI
FORQHG DQLPDOV DQG IXOO VLEOLQJV HYDOXDWLQJ LQ GHWDLO DQ\ XQDQWLFLSDWHG FRPSRVLWLRQDO
GLIIHUHQFHVGLIIHUHQFHVLQSURWHLQTXDOLW\RUQXWULHQWELRDYDLODELOLW\

$VWKHGRQRUQXFOHLXVHGWRSURGXFH(06FORQHVDUHWDNHQIURPHPEU\RQLFFHOOVWKHUH
LVOLWWOHLIDQ\JHQRPLFUHSURJUDPPLQJQHHGHGWRGULYHHPEU\RJHQHVLV+RZHYHUEODVWRPHUHV
IURPHPEU\RVRIPRUHWKDQHLJKWFHOOV LHIURPWKHVWDJHVW\SLFDOO\XVHGIRU%17 PXVWEH
UHSURJUDPPHG XSRQ 17 EHFDXVH WKH\ H[SUHVV D VXEVWDQWLDO QXPEHU RI JHQHV LQFOXGLQJ
SDWHUQDO JHQHV WKDW DUH QRW H[SUHVVHG E\ WKH RRF\WH QXFOHXV ,QGHHG WKH QXFOHXV RI WKH
PDWXUH GRQRU RRF\WH LV WUDQVFULSWLRQDOO\ TXLHVFHQW DQG LV DVVRFLDWHG ZLWK D GLIIHUHQW VHW RI
FKURPDWLQSURWHLQV HJKLVWRQHV FRPSDUHGWRWKHUHFLSLHQWRRF\WHQXFOHXV

$VLPLODUDUUD\RIJHVWDWLRQDODQGSRVWQDWDODEQRUPDOLWLHVVHHQLQVRPDWLFFHOOQXFOHDU
WUDQVIHUDOVR KDV EHHQ REVHUYHG LQ %17FORQHV7R WKH GHJUHH WKDW LQDGHTXDWHRU RWKHUZLVH
GLIIHUHQWUHSURJUDPPLQJUHODWLYHWRWKDWRFFXUULQJQRUPDOO\LQJDPHWLFQXFOHLRFFXUVLQ%17
WKH FRPSRVLWLRQ RI IRRG SURGXFWV IURP 17 DQLPDOV PLJKW GLIIHU IURP WKDW RI RUGLQDU\
DQLPDOV$OWKRXJKLWLVGLIILFXOWWRFKDUDFWHUL]HWKHOHYHORIFRQFHUQZLWKRXWVSHFLILFGDWDLW
VHHPVXQOLNHO\WKDWWKHUH DUH FKDQJHV LQ JHQH H[SUHVVLRQ GLUHFWO\UHODWHGWR(06 DQG%17
FORQLQJ SURFHGXUHVWKDW ZRXOG ULVH QXWULWLRQDO RU IRRG VDIHW\FRQFHUQV )RRG SURGXFWV IURP
%17FORQHVKDYHEHHQFRQVXPHGE\KXPDQVZLWKQRDSSDUHQWLOOHIIHFWV%DVHGRQFXUUHQW
VFLHQWLILFXQGHUVWDQGLQJWKHFRPPLWWHHUHJDUGVSURGXFWVRI(06DQG%17FORQHVDVSRVLQJD
ORZOHYHORIIRRGVDIHW\FRQFHUQ1HYHUWKHOHVVLWZRXOGVHHPDSSURSULDWHWKDWWKH)'$XVH

ϯϯϰ

DYDLODEOH DQDO\WLF WHVWV WR HYDOXDWH WKH FRPSRVLWLRQ RI IRRG SURGXFWV IURP DQLPDOV WKDW
WKHPVHOYHV UHVXOW GLUHFWO\ IURP %17 FORQLQJ SURFHGXUHV WR YHULI\ WKDW WKH\ IXOILOO H[LVWLQJ
VWDQGDUGV IRU DQLPDOGHULYHG IRRG SURGXFWV 7KH SURGXFWV IURP WKH RIIVSULQJ RI FORQHG
DQLPDOVZHUHUHJDUGHGDVSRVLQJQRIRRGVDIHW\FRQFHUQEHFDXVHWKHDQLPDOVDUHWKHUHVXOWRI
QDWXUDOPDWLQJV

7KH FORQLQJ RI DQLPDOV IURP VRPDWLF FHOOV LV PRUH UHFHQW /LPLWHG VDPSOH VL]H DQG
KHDOWKDQGSURGXFWLRQGDWDDVZHOODVUDSLGO\FKDQJLQJFORQLQJSURWRFROVPDNHLWGLIILFXOWWR
GUDZ FRQFOXVLRQV UHJDUGLQJ WKH VDIHW\ RI PLON PHDW RU RWKHU SURGXFWV IURP VRPDWLF FHOO
FORQHVDQGWKHLURIIVSULQJ7KHNH\VFLHQWLILFLVVXHLVZKHWKHUDQGWRZKDWGHJUHHWKHJHQRPLF
UHSURJUDPPLQJWKDWRFFXUVZKHQDGLIIHUHQWLDWHGQXFOHXVLVSODFHGLQWRDQHQXFOHDWHGHJJDQG
IRUFHGWR GULYH WKH GHYHORSPHQW RID FORQH PLJKW UHVXOWLQJHQHH[SUHVVLRQWKDWUDLVHVIRRG
VDIHW\FRQFHUQV'LIIHUHQFHVLQSDWWHUQVRIGHYHORSPHQWDOJHQHH[SUHVVLRQLQQRQHQJLQHHUHG
LQGLYLGXDOV DQG VRPDWLF FHOO FORQHV ZRXOG EH JUHDWHVW GXULQJ HDUO\ GHYHORSPHQW ZKHQ
UHSURJUDPPLQJLVLQFRPSOHWH$QXPEHURIGDWDVHWVVXJJHVWWKDWWKHKHDOWKDQGZHOOEHLQJRI
QHRQDWDO DQG \RXQJ VRPDWLF FHOO FORQHV RIWHQ DUH LPSDLUHG UHODWLYH WR WKRVH RI QRUPDO
LQGLYLGXDOV'LUHFWHIIHFWVRIDQ\DEQRUPDOLWLHVLQSDWWHUQVRIJHQHH[SUHVVLRQRQIRRGVDIHW\
DUH XQNQRZQ +RZHYHU EHFDXVH VWUHVV IURP WKHVH GHYHORSPHQWDO SUREOHPV PLJKW UHVXOW LQ
VKHGGLQJRISDWKRJHQVLQIHFDOPDWHULDOUHVXOWLQJLQDKLJKHUORDGRIXQGHVLUDEOHPLFUREHVRQ
WKH FDUFDVV WKH IRRG VDIHW\ RI SURGXFWV VXFK DV YHDO IURP \RXQJ VRPDWLF FHOO FORQHG
DQLPDOVPLJKWLQGLUHFWO\SUHVHQWDIRRGVDIHW\FRQFHUQ$VDVRPDWLFFHOOFORQHGHYHORSVDQG
QXFOHDUUHSURJUDPPLQJLVFRPSOHWHGSDWWHUQVRIJHQHH[SUHVVLRQZRXOGDSSURDFKWKRVHRID
QRQHQJLQHHUHG LQGLYLGXDO ,QGHHG WKH KHDOWK DQG ZHOOEHLQJ RI VRPDWLF FHOO FORQHV
DSSUR[LPDWHG WKRVH RI QRUPDO LQGLYLGXDOV DV WKH\ DGYDQFH LQWR WKH MXYHQLOH VWDJH )RU
H[DPSOH VRPDWLF FHOO FORQHG FDWWOH UHSRUWHGO\ ZHUH SK\VLRORJLFDOO\ LPPXQRORJLFDOO\ DQG
EHKDYLRUDOO\QRUPDODQGH[KLELWHGSXEHUW\DWWKHH[SHFWHGDJHZLWKKLJKUDWHVRIFRQFHSWLRQ
XSRQ DUWLILFLDO LQVHPLQDWLRQ 7ZR RI WKHVH LQGLYLGXDOV KDYH JLYHQ ELUWK WR FDOYHV WKDW VHHP
SKHQRW\SLFDOO\QRUPDO7KHUHDUHWRGDWHQRSXEOLVKHGFRPSDUDWLYHDQDO\WLFDOGDWDDVVHVVLQJ
WKH FRPSRVLWLRQ RI PHDW DQG PLON SURGXFWV RI VRPDWLF FHOO FORQHV WKHLU RIIVSULQJ DQG
FRQYHQWLRQDOO\ EUHG LQGLYLGXDOV  +RZHYHU WKH FRPPLWWHH IRXQG LW GLIILFXOW WR FKDUDFWHUL]H
WKHOHYHORIFRQFHUQZLWKRXWIXUWKHUVXSSRUWLQJHYLGHQFHUHJDUGLQJIRRGSURGXFWFRPSRVLWLRQ
&XUUHQWO\WKHUHLVQRHYLGHQFHWKDWIRRGSURGXFWVGHULYHGIURPDGXOWVRPDWLFFHOOFORQHVRU
WKHLUSURJHQ\SRVHDKD]DUG LHWKHUHLVQRHYLGHQFHWKDWWKH\SUHVHQWDIRRGVDIHW\FRQFHUQ 

*HQHWLFDOO\HQJLQHHUHGDQLPDOV

$QXPEHU RI W\SHV RI JHQHWLFDOO\ HQJLQHHUHG DQLPDOV ZLOO EH GHYHORSHGSULPDULO\IRU
IRRG DQG RWKHUV ZLOO EH GHYHORSHG SULPDULO\ IRU SURGXFLQJ QRQIRRG PDWHULDOV VXFK DV
SKDUPDFHXWLFDOVYDFFLQHVILEHUVDQGRWKHUKLJKYDOXHSURGXFWV7KHSULQFLSOHVIRUDVVHVVLQJ
WKHVDIHW\RIIRRGIURPJHQHWLFDOO\HQJLQHHUHGDQLPDOVDUHTXDOLWDWLYHO\WKHVDPHDVIRUQRQ
HQJLQHHUHGDQLPDOVEXWDQLPDOVJHQHWLFDOO\HQJLQHHUHGIRUQRQIRRGSURGXFWVPLJKWSUHVHQW
DGGLWLRQDOFRQFHUQVUHODWLQJWRWKHQDWXUHRIWKHSURGXFWVWKDWWKH\JHQHUDWH$VIRUDOOIRRGV
RUIRRGSURGXFWVWKRVHIURPJHQHWLFDOO\HQJLQHHUHGDQLPDOVVKRXOGEHHYDOXDWHGIRUDJHQWV
FKHPLFDORUELRORJLFZKLFKDIIHFWWKHVDIHW\RIWKHIRRGIRUWKHKXPDQFRQVXPHU

$QLPDOVXVHGIRU[HQRWUDQVSODQWDWLRQDUHQRWFRQVLGHUHGVDIHIRU KXPDQ FRQVXPSWLRQ
DQG DUH H[FOXGHG IURP WKH IRRG FKDLQ E\ FXUUHQW UHJXODWLRQV 7KHLU H[FOXVLRQ LV EDVHG
SULPDULO\ RQ FRQFHUQV DERXW SHUVLVWHQW WLVVXH UHVLGXHV RI DJHQWV XVHG WR DQDHVWKHWL]H WKH
DQLPDO EHIRUH KDUYHVWLQJ WKH WLVVXHV DQG RUJDQV ,I WKHUH ZHUH DQ\ SRVVLELOLW\ WKDW VXFK
DQLPDOVPLJKWEHUHQGHUHGDQGFRQVLGHUHGIRUIXUWKHUSURFHVVLQJLQWRXVHIXOKXPDQIRRGRU

ϯϯϱ

PHGLFDO SURGXFWV FRQFHUQV DERXW DQHVWKHWLF UHVLGXHV ZRXOG UHPDLQ SHUWLQHQW ,I DQLPDOV
JHQHWLFDOO\HQJLQHHUHGIRU[HQRWUDQVSODQWDWLRQEXWQRWXVHGIRUWKDWSXUSRVHZHUHSUHVHQWHG
IRUHQWU\LQWRWKHIRRGFKDLQWKHIRRGVDIHW\RIVXFKDQLPDOVDOVRZRXOGKDYHWREHHYDOXDWHG
EDVHGRQSURWRFROVGHYHORSHGIRUHYDOXDWLQJRWKHUJHQHWLFDOO\HQJLQHHUHGDQLPDOV

$QLPDOVPLJKWEHJHQHWLFDOO\HQJLQHHUHGWRSURGXFHQRQIRRGSURGXFWVLQWKHLUPLONRU
HJJV +DOI RI WKH JHQHWLFDOO\ HQJLQHHUHG SRSXODWLRQ ZLOO EH PDOH DQG ZLOO QRW EH GLUHFWO\
XVHIXOIRUSURGXFWLRQRIKHWHURORJRXVSURWHLQVLQIRUH[DPSOHPLONRUHJJV,WLVOLNHO\WKDW
FRPSDQLHV SURGXFLQJ VXFK DQLPDOV ZLOO VHHN HDUO\ HQWU\ RI PDOHV WKDW DUH WUDQVJHQLF EXW
LQFDSDEOHRISURGXFLQJPLONRUHJJVLQWRWKHIRRGFKDLQ,QDGGLWLRQFRPSDQLHVPLJKWZDQW
WR HQWHU IHPDOHV WKDW DUH ³QR WDNHV´ ZKLFK GR QRW H[SUHVV KLJK OHYHOV RI WKH SURGXFW RI
LQWHUHVWRUWKDWKDYHUHDFKHGWKHHQGRIWKHLUSURGXFWLYHOLYHVLQWRWKHKXPDQIRRGVXSSO\
7KHVDIHW\RIIRRGSURGXFWVIURPVXFKDQLPDOVWKDWZHUHFXOOHGIURPWUDQVJHQLFOLQHVPLJKW
SUHVHQWFRQFHUQV

1XPHURXV H[SHULPHQWV KDYH VKRZQ WKDW WKH OHYHO DQG VSHFLILFLW\ RI WUDQVJHQH
H[SUHVVLRQ LQ DQ DQLPDO LV SUHGLFWDEOH RQO\ WR D OLPLWHG H[WHQW SUREDEO\ EHFDXVH DOO WKH
IDFWRUVDIIHFWLQJJHQHH[SUHVVLRQKDYHQRW\HWEHHQLGHQWLILHG7UDQVJHQHVPLJKWEHH[SUHVVHG
DW D ORZ OHYHO LQ YDULRXV WLVVXHV LQ ZKLFK WKH SURPRWHU LV QRW H[SHFWHG WR EH DFWLYH 6XFK
HFWRSLF H[SUHVVLRQ PLJKW EH GXH WR JHQRPLF SRVLWLRQ HIIHFWV DWWULEXWDEOH WR WKH DFWLRQ RI
QHLJKERULQJHQKDQFHUHOHPHQWV,QDGGLWLRQHFWRSLFH[SUHVVLRQPLJKWUHVXOWIURPEDVDOOHYHO
WUDQVFULSWLRQDWWKHVLWHRILQWHJUDWLRQ5HFRPELQDQWSURWHLQVZKRVHH[SUHVVLRQ LV GULYHQ E\
UHJXODWRU\HOHPHQWVGLUHFWLQJH[SUHVVLRQLQPDPPDU\JODQGVKDYHEHHQREVHUYHGLQWKHEORRG
RI WUDQVJHQLF DQLPDOV GXULQJ ODFWDWLRQ 7KH SUHVHQFH RI WUDQVJHQH SURGXFWV LQ EORRG PLJKW
UHVXOW IURP OHDNDJH RI WKH PDPPDU\ HSLWKHOLXP RU IURP VHFUHWLRQ DW WKH DSLFDO VLGH RI
PDPPDU\ FHOOV )RU H[DPSOH DOWKRXJK WKH SURPRWHU IURP WKH ZKH\ DFLGLF SURWHLQ :$3 
JHQH KDV EHHQ XVHG WR GLUHFW H[SUHVVLRQ RI D WUDQVJHQH LQ PDPPDU\ WLVVXH DQG VRPH
FRQFHQWUDWLRQ RI :$3 QRUPDOO\ LV IRXQG LQ WKH EORRG RI ODFWDWLQJ DQLPDOV +HQFH WKURXJK
ELRDFWLYLW\DOOHUJHQLFLW\RUWR[LFLW\SDWKZD\VHFWRSLFJHQHH[SUHVVLRQPLJKWGLUHFWO\DIIHFW
WKH VDIHW\RI IRRGSURGXFWVGHULYHGIURPWLVVXHVVH[HVRUOLIHVWDJHV RIWUDQVJHQLF DQLPDOV
ZKHUHWUDQVJHQHH[SUHVVLRQLVQRWH[SHFWHG,QVRPHFDVHVUHFRPELQDQWSURWHLQVSURGXFHGLQ
PLONKDYHGHOHWHULRXVHIIHFWVRQPDPPDU\JODQGIXQFWLRQRURQWKHWUDQVJHQLFDQLPDOVPRUH
JHQHUDOO\7KHVHHIIHFWVPLJKWVWHPIURPHFWRSLFH[SUHVVLRQRIWKHWUDQVJHQHRUIURPWUDQVIHU
RIWKHUHFRPELQDQWSURWHLQVIURPPDPPDU\JODQGWREORRG$QLPDOVZLWKYDULDEOHOHYHOVRU
HFWRSLFH[SUHVVLRQRIWKHWUDQVJHQHSUHVXPDEO\ZLOOEHLGHQWLILHGLQWKHGHYHORSPHQWRIWKH
WUDQVJHQLF OLQHV 6KRXOG SURGXFWV IURP VXFK LQGLYLGXDOV EH UHOHDVHG WR FRPPHUFLDOL]DWLRQ
FKDQQHOVWKH\FRXOGSRVHDIRRGVDIHW\FRQFHUQXQOHVVWKHSURWHLQRIFRQFHUQLVVFUHHQHGIRU
DQG IRXQGDEVHQW ,W LVH[SHFWHG WKDWZHOOHVWDEOLVKHG WUDQVJHQLFOLQHV WR EH XVHG LQ URXWLQH
SURGXFWLRQ ZLOO KDYH EHHQ VXEMHFWHG WR VHOHFWLRQ DQG WKDW FRQFHUQV SRVHG E\ XQVWDEOH RU
HFWRSLFJHQHH[SUHVVLRQZLOOKDYHEHHQDGGUHVVHGWRDODUJHGHJUHH6KRXOGSKDUPDFHXWLFDOV
RURWKHUELRORJLFDOO\DFWLYHSURWHLQVHQWHUWKHIRRGVXSSO\WKURXJKSURGXFWVRIVXFKDQLPDOV
DVVRFLDWHG IRRG VDIHW\ FRQFHUQ FRXOG EH KLJK $GGLWLRQDOO\ WKH HIIHFWV RI WUDQVJHQH
H[SUHVVLRQ RQ DQLPDO ZHOOEHLQJ PLJKW LQGLUHFWO\ DIIHFW WKH VDIHW\ RI IRRG SURGXFWV GHULYHG
IURPWKHLUWLVVXHVWKURXJKVWUHVVPHGLDWHGPHFKDQLVPV

([SUHVVLRQRIWUDQVJHQHVDOVRPLJKWEHLQWHQGHGWRFKDQJHWKHQXWULWLRQDODWWULEXWHVRU
LPSURYH WKH VDIHW\ RI IRRG SURGXFWV )RU H[DPSOH H[SUHVVLRQ RI WUDQVJHQHV LQ PLON PLJKW
RSWLPL]HPLONFRPSRVLWLRQDGGQHXWUDFHXWLFDOVWRPLONRUUHGXFHWKHLQFLGHQFHRILQIHFWLRXV
GLVHDVH 6HYHUDO V\VWHPV DUH EHLQJ GHYHORSHG WR UHGXFH ODFWRVH FRQFHQWUDWLRQ LQ PLON

ϯϯϲ

6HFUHWLRQ RI ERYLQHODFWDOEXPLQ DQ HQ]\PH  LQ SLJ PLON LQFUHDVHG SLJOHW JURZWK VKRZLQJ
WKHSRWHQWLDOIRUFKDQJLQJWKHQXWULWLYHYDOXHRIPLON

,PPXQRJOREXOLQ $ GLUHFWHG DJDLQVW YLUXVHV LQIHFWLQJ WKH GLJHVWLYH WUDFW PLJKW EH
H[SUHVVHG LQ PLON DQG YLUDO DQWLJHQV DFWLYDWHG E\ RUDO DGPLQLVWUDWLRQ PLJKW EH XVHG WR
YDFFLQDWHKXPDQVDQGDQLPDOVDJDLQVWYLUDOGLVHDVH
&KDQJHV RI WKHVH W\SHV UDLVH D PRGHUDWH OHYHO RI IRRG VDIHW\ FRQFHUQ &ODLPV RI
QXWULWLRQDO DWWULEXWHV VDIHW\ DQG HIILFDF\ RI PLON RU RWKHU IRRG SURGXFWV IURP WUDQVJHQLF
DQLPDOVPXVWEHGHPRQVWUDWHG

$QLPDOV PLJKW EH GHYHORSHG WR SURGXFH IRRG SURGXFWV GHVLJQHG WR ILW VSHFLDO KXPDQ
GLHWDU\ QHHGV 3RVVLEOH IXWXUH SURGXFWV PLJKW LQFOXGH PLON WKDW ODFNV WKH PRVW FRPPRQ
DOOHUJHQLFSURWHLQHJJVWKDWDUHORZHULQFKROHVWHUROPHDWZLWKHQKDQFHGYLWDPLQFRQWHQWRU
IDWFRQWHQWPRGLILHGLQTXDOLW\RUTXDQWLW\7KHQXWULHQWSURILOHVRIPHDWDQGDQLPDOSURGXFWV
DUHZHOOGRFXPHQWHGDQGFKDQJHVLQWKLVSURILOHUDLVHFRQFHUQV&KDQJHVPLJKWEHXQZDQWHG
E\VRPHFRQVXPHUVDQGPLJKWDGGYDOXHIRURWKHUV,IWKHVHFKDQJHGSURGXFWVZHUHODEHOHG
WRDSSHDOWRWDUJHWHGFRQVXPHUVDQGLGHQWLILDEOHWRWKRVHZKRKDYHPHGLFDORURWKHUUHDVRQV
WRDYRLGVXFKIRRGVWKH\ZRXOGEHRIORZFRQFHUQ1RYHOSURWHLQVDOVRFDQEHSURGXFHGE\
JHQHWLFHQJLQHHULQJ

$OWKRXJK SURWHLQV DUH QHFHVVDU\ FRPSRQHQWV RI WKH KXPDQ GLHW WKH\ FDQ H[HUW
XQGHVLUDEOHHIIHFWV LQFOXGLQJ   DOOHUJHQLFLW\ DQG K\SHUVHQVLWLYLW\  ELRDFWLYLW\DQG  
WR[LFLW\

2WKHU%LRDFWLYH&RPSRXQGV

,Q VRPH FDVHV WKH DLP RI JHQHWLF HQJLQHHULQJ LV WR HQKDQFH H[SUHVVLRQ RI DQ
HFRQRPLFDOO\ LPSRUWDQW WUDLW HJ JURZWK UDWH RU WR LPSURYH UHVLVWDQFH WR GLVHDVH HJ
PDVWLWLV,QRWKHUVDQLPDOVZLOOEHHQJLQHHUHGWRH[SUHVVSURWHLQVRISKDUPDFHXWLFDOLQWHUHVW
7KHVH DSSOLFDWLRQV LQYROYH WKH H[SUHVVLRQ RI ELRORJLFDOO\ DFWLYH SURWHLQV RU SRO\SHSWLGHV
HQFRGHG E\ D WUDQVJHQH 7KH SRVVLELOLW\ H[LVWV WKDW VXFK PROHFXOHV FRXOG UHWDLQ WKHLU
ELRDFWLYLW\DIWHUFRQVXPSWLRQUDLVLQJDIRRGVDIHW\FRQFHUQ

7KHELRDFWLYHSURGXFWRIDWUDQVJHQHLQPRVWFDVHVZLOOEHDSURWHLQRULQVRPHFDVHV
D SRO\SHSWLGH 'XULQJ GLJHVWLRQ SURWHLQV DQG ODUJHU SRO\SHSWLGHV ODUJHO\ DUH EURNHQ GRZQ
LQWRVPDOOSHSWLGHIUDJPHQWVDQGDPLQRDFLGVE\SURWHRO\WLFHQ]\PHVLQWKHGLJHVWLYHWUDFW
'L DQG WULSHSWLGHV WKDW DUH DEVRUEHG LQWR GLJHVWLYH HSLWKHOLDO FHOOV DUH EURNHQ GRZQ LQWR
DPLQR DFLGV E\ LQWUDFHOOXODU HQ]\PHV )HZ LQWDFW VPDOO SHSWLGHV DUH DEVRUEHG LQWR WKH
EORRGVWUHDP GXULQJ GLJHVWLRQ 6XEVWDQWLDO GHJUDGDWLRQ RI WKH LQWDFW SURWHLQ HIIHFWLYHO\
GHVWUR\VLWVRULJLQDOELRDFWLYLW\EHFDXVHWKDWELRDFWLYLW\GHSHQGVRQWKHLQWHJULW\RIDWOHDVWD
SRUWLRQ RI WKH SURWHLQ RU SHSWLGH $OOHUJHQLFLW\ PLJKW RI FRXUVH UHPDLQ D SUREOHP IRU
VHQVLWLYH LQGLYLGXDOV 0DQ\ IRRG DOOHUJHQV DUH DEVRUEHG LQWR WKH EORRGVWUHDP :KLOH PRVW
LQWDFW SURWHLQV JHQHUDOO\ DUH QRW DEVRUEHG LQWR WKH EORRGVWUHDP RI KHDOWK\ DGXOWV ZLWK DQ
LQWDFW SURSHUO\ IXQFWLRQLQJ GLJHVWLYH V\VWHP DEVRUSWLRQ PLJKW RFFXU LQ LQGLYLGXDOV ZKRVH
GLJHVWLYHHSLWKHOLXPKDVEHHQFRPSURPLVHGE\GLVHDVHRULQMXU\SRVVLEO\SRVLQJDOOHUJHQLF
UHVSRQVH ,Q VXFK FDVHV WKH QRUPDO DUUD\ RI GLJHVWLYH HQ]\PHV PLJKW EH DEVHQW RU WKH
LQWHJULW\RIWKHHSLWKHOLXPDVDEDUULHUPLJKWEHFRPSURPLVHG

*DVWURHQWHULWLVIRUH[DPSOHFDQUHGXFHWKH VHFUHWLRQ RI GLJHVWLYHHQ]\PHV DQGFDXVH
WKHEUHDNGRZQRIGLJHVWLYHHSLWKHOLXPUHVXOWLQJLQWKHSDVVDJHRILQWDFWSURWHLQVDQGSHSWLGHV

ϯϯϳ

LQWR WKH EORRGVWUHDP $ IRRG VDIHW\ FRQFHUQ WKXV DULVHV ZKHQ LQGLYLGXDOV ZKRVH GLJHVWLYH
V\VWHP KDV EHHQ FRPSURPLVHG E\ GLVHDVH LQMXU\ RU DGYDQFHG DJH LQJHVW IRRGV FRQWDLQLQJ
ELRDFWLYHSURWHLQVRUSHSWLGHV

7KHGLJHVWLYHHSLWKHOLXPRIQHZERUQLQIDQWVSHUPLWVWKHWUDQVLHQWDEVRUSWLRQRIZKROH
SURWHLQV RU ODUJH SURWHLQ IUDJPHQWV XQWLO FORVXUH RI WKH JXW HSLWKHOLXP RFFXUV &ORVXUH LV
IDFLOLWDWHG E\ EUHDVWIHHGLQJ DQG GHOD\HG LQ LQIDQWV WKDW DUH IRUPXOD IHG 7KH WLPLQJ RI WKH
FORVXUHPLJKWUDQJHIURPZHHNVWRPRQWKVGHSHQGLQJRQGLHWDU\ IDFWRUV %HIRUHFORVXUHD
ZLGH YDULHW\ RI LQWDFW SURWHLQV PLJKW FURVV WKH GLJHVWLYH HSLWKHOLXP E\ D QRQVHOHFWLYH
PHFKDQLVP DQG HQWHU WKH EORRGVWUHDP 7KXV FRQVXPSWLRQ RI IRRG HVSHFLDOO\ PLON 
FRQWDLQLQJELRDFWLYHSURWHLQVRUSHSWLGHVFRXOGUHVXOWLQWKHWUDQVIHU RI VXFK PROHFXOHV LQWR
WKHEORRGVWUHDPRIQHZERUQLQIDQWV7KLVSRVVLELOLW\UDLVHVDFRQFHUQUHJDUGLQJUHFRPELQDQW
ELRDFWLYHPROHFXOHVSUHVHQWLQPLONXVHGLQLQIDQWIRUPXODV

%LRDFWLYH SHSWLGHVDQG SURWHLQV DOVR PLJKW H[HUW WKHLU HIIHFWV LQ WKHGLJHVWLYH V\VWHP
EHIRUH DEVRUSWLRQ )RU H[DPSOH UHFRPELQDQW KXPDQ ELOHVDOW VWLPXODWHG OLSDVH %66/  KDV
EHHQH[SUHVVHGLQWKHPLONRIWUDQVJHQLFVKHHSWKLVSURWHLQLVLQWHQGHGIRURUDODGPLQLVWUDWLRQ
DVDWKHUDSHXWLFDJHQWIRUWUHDWLQJSDWLHQWVVXIIHULQJIURPSDQFUHDWLWLV&RQVXPSWLRQRIIRRG
SURGXFWV LH PLON DQG PHDW  IURP DQLPDOV H[SUHVVLQJ ELRDFWLYH PROHFXOHV VXFK DV %66/
FRXOG DOWHU GLJHVWLRQ LQ RWKHUZLVH KHDOWK\ LQGLYLGXDOV DQG SUHVHQWV D IRRG VDIHW\ FRQFHUQ
/\VRVWDSKLQ D EDFWHULFLGDO SURWHLQ H[SUHVVHG E\ FHUWDLQ EDFWHULD KDV EHHQ H[SUHVVHG LQ
PXULQHPLONZKHUHLW UHGXFHG PDVWLWLV FDXVHG E\ 6WDSK\ORFRFFXV DXUHXV7UDQVJHQLFFDWWOH
H[SUHVVLQJO\VRVWDSKLQLQPLONKDYHEHHQJHQHUDWHGZLWKWKHLQWHQWRIUHGXFLQJPDVWLWLVLQWKDW
VSHFLHV 6LPLODUO\ WUDQVJHQLF ILVK LV SURGXFHG WR H[SUHVV WKH K\EULG DQWLPLFURELDO SHSWLGH
FHFURSLQPHOLWWLQ IRU FRQWURO RI ILVK SDWKRJHQV 3UHOLPLQDU\ VWXGLHV XVLQJ LQMHFWLRQV
GHPRQVWUDWHGWKHHIIHFWLYHQHVVRIWKHDQWLPLFURELDOSHSWLGHWRSURWHFWILVKDJDLQVWLQIHFWLRQV
DQG VXJJHVWHG WKDW WKH VWUDWHJ\ RI RYHUH[SUHVVLQJ WKH SHSWLGHV LQ WUDQVJHQLF ILVK PLJKW
SURYLGH D PHWKRG RI GHFUHDVLQJ EDFWHULDO GLVHDVH SUREOHPV LQ ILVK 0LON FRQWDLQLQJ
O\VRVWDSKLQRUILVKH[SUHVVLQJFHFURSLQPHOLWWLQFRXOGDOWHUWKHEDODQFHRIGLJHVWLYHWUDFWIORUD
RIFRQVXPHUVRIWKHVHSURGXFWVLQDGGLWLRQZLGHVSUHDGXVHRIVXFKDQWLPLFURELDODJHQWVDOVR
FRXOGIRVWHUWKHHPHUJHQFHRIO\VRVWDSKLQUHVLVWDQWVWUDLQVRISDWKRJHQLF 6DXUHXV RU 9LEULR
DQJXLOODUXP 7KXV IRRG SURGXFWV FRQWDLQLQJ DQWLPLFURELDO SURWHLQV PLJKW SUHVHQW D IRRG
VDIHW\ FRQFHUQLQ YLHZ RI WKHLU SRWHQWLDO WR DOWHU WKH EDODQFH RI FRQVXPHUV¶LQWHVWLQDO IORUD
DQGPLJKWIRVWHUWKHHYROXWLRQRIPLFURELDOVWUDLQVUHVLVWDQWWRVSHFLILFDJHQWV

0DQ\JHQHWLFDOO\HQJLQHHUHGILVKDQGVKHOOILVKH[SUHVVDQLQWURGXFHGJURZWKKRUPRQH
*+  JHQHPRVW RIWHQ D ILVK *+ JHQH WR SURPRWH UDSLG JURZWK +HQFH LW LV SDUWLFXODUO\
LPSRUWDQWWRPDNHVXUHWKDWVXFKDWUDQVJHQHSURGXFWKDVQRELRORJLFDFWLYLW\ LQKXPDQVRU
DQLPDOV WKDWFRQVXPH ILVKRU VKHOOILVKH[SUHVVLQJ VXFK D WUDQVJHQH 7KH IRRG VDIHW\ RI *+
SURWHLQV ZDV HYDOXDWHG ZKHQ DGPLQLVWUDWLRQ RI UHFRPELQDQW ERYLQH *+ UE*+  7KH )'$
FLWHGGDWDVKRZLQJWKDWQRQSULPDWH*+SURWHLQVDUHQRWELRORJLFDOO\DFWLYHLQKXPDQVQRU
DUH IUDJPHQWV RI WKH *+ PROHFXOH QRU LQVXOLQOLNH JURZWK IDFWRUV VHFUHWHG E\ WKH KRVW LQ
UHVSRQVH WR *+ DGPLQLVWUDWLRQ 1HLWKHU ERYLQH *+ QRU ERYLQH LQVXOLQOLNH JURZWK IDFWRU ,
,*), ZDVRUDOO\DFWLYHLQUDWVDVSHFLHVUHVSRQVLYHWRSDUHQWHUDOO\DGPLQLVWHUHGERYLQH*+
7KH)'$DOVRFLWHGVWXGLHVVKRZLQJWKDWERYLQHRYLQHZKDOHDQGSRUFLQHJURZWKKRUPRQHV
DUH QRW ELRORJLFDOO\ DFWLYH LQ KXPDQV ZKLFK VXJJHVWV WKDW SLVFLQH JURZWK KRUPRQHV DUH
XQOLNHO\WREHELRORJLFDOO\DFWLYHLQKXPDQV

7KHGHJUHHWRZKLFKIXOOWHUPKXPDQLQIDQWVDEVRUELQWDFWSURWHLQVLVHTXLYRFDO)'$
FLWHGVWXGLHVVKRZLQJWKDWFRQFHQWUDWLRQVRI,*),LQPLONRIUE*+WUHDWHGFRZVZDVZLWKLQ

ϯϯϴ

WKHSK\VLRORJLFUDQJHLQKXPDQEUHDVWPLONDQG,*),LVGHQDWXUHGXQGHUFRQGLWLRQVXVHGWR
SURFHVV FRZ¶V PLON IRU LQIDQW IRUPXOD ,Q WKH XQOLNHO\ FDVH WKDW SURGXFWV RI *+WUDQVJHQLF
ILVKRUVKHOOILVKZRXOGEHIHGWRKXPDQLQIDQWVFRRNLQJZRXOGGHQDWXUHDFWLYH*+DQG,*),
PROHFXOHV $JDLQVW WKH EDFNJURXQG RI WKH GLVFXVVLRQ DERYH WKH FRPPLWWHH UHJDUGV WKH
OLNHOLKRRG WKDW D ELRDFWLYH SURGXFW SRVHV D KD]DUG ZLOO YDU\ DPRQJ JHQH SURGXFWV IRRG
SURGXFWV DQG FRQVXPHUV LQ YDULRXV FDVHV SRVLQJ D ORZ WR PRGHUDWH OHYHO RI IRRG VDIHW\
FRQFHUQ )RU D VXVFHSWLEOH LQGLYLGXDO KRZHYHU VXFK D KD]DUG FRXOG KDYH VHYHUH
FRQVHTXHQFHV 7DEOH 

7DEOH([DPSOHVRI%LRUHDFWRUV

‡ 1DNHGKXPDQ+EIURPSLJV
‡ +XPDQODFWRIHUULQLQFRZV¶PLON
‡ $OSKDDQWLWU\SVLQLQVKHHS
‡ +*+LQPRXVHXULQH XURSODNLQSURPRWHUV 
‡ +XPDQDQWLERGLHVLQPLFH +DQG/FKDLQWJHQLFVÆK\EULGRPDV 
‡ &I7&5LQJRDWV
‡ 7LVVXHSODVPLQRJHQDFWLYDWRU 73$ LQJRDWV
‡ +XPDQDQWLWKURPELQ,,,LQJRDWV
‡ 0DODULDDQWLJHQVLQJRDWV YDFFLQH 
‡ $OSKDJOXFRVLGDVHLQUDEELWV 3RPSH¶VGLVHDVH


7R[LFLW\

0DQ\ WR[LQV DUH ZHOO VWXGLHG DQG JHQHV IRU NQRZQ WR[LQV ZRXOG QRW EH WUDQVIHUUHG
SXUSRVHIXOO\LQWRDIRRGDQLPDO$VQRWHGHDUOLHUJHQHWLFHQJLQHHULQJZLOOKDYHWKHSRWHQWLDO
RI LQWURGXFLQJ QRYHO SURWHLQV H[SUHVVHG LQ IRRG DQLPDOV %HFDXVH SURWHLQV JHQHUDOO\ DUH
EURNHQGRZQLQWKHGLJHVWLYHV\VWHPLQWRFRPPRQDPLQRDFLGVWKHGLUHFWWR[LFLW\RISURWHLQV
EH\RQG WKH SRVVLELOLWLHV RI DOOHUJHQLFLW\ DQG ELRDFWLYLW\ GLVFXVVHG DERYH  LV XQXVXDO DQG
JHQHUDOO\ RI ORZ IRRGVDIHW\ FRQFHUQ 3XUSRVHIXOO\ H[SUHVVHG SURWHLQV WKDW UHPDLQ LQWDFW RU
RWKHUZLVH SRVH D SRWHQWLDO VDIHW\ FRQFHUQ SUHVXPDEO\ ZLOO EH IXOO\ HYDOXDWHG LQ WKH SUH
PDUNHWUHYLHZDQGDSSURYDOSURFHVVDQGWKXVSRVHDUHODWLYHO\ORZFRQFHUQ

2IJUHDWHUFRQFHUQWRWKHFRPPLWWHHZLWKUHVSHFWWRSRVVLEOHWR[LFLW\DUHWKHXQLQWHQGHG
DQG XQDQWLFLSDWHG HIIHFWV DQG E\SURGXFWV RI WKH JHQHWLF HQJLQHHULQJ RI D IRRG DQLPDO
LQFOXGLQJEXWQRWOLPLWHGWRWKHVHQRYHOSURWHLQV)RUH[DPSOHWKHHQJLQHHULQJFRXOGDOWHUD
PHWDEROLF SURFHVV WKDW WKHQ UHVXOWV LQ D WR[LF PHWDEROLWHEHLQJ SUHVHQW LQ HGLEOH WLVVXH 7KH
TXHVWLRQ DV VXJJHVWHG LV ZKHWKHU HGLEOH SURGXFWV RI JHQHWLFDOO\ HQJLQHHUHG DQLPDOV KDYH
EHHQVFUHHQHGDGHTXDWHO\WRGHWHFWWKHSUHVHQFHRIXQDQWLFLSDWHGFRPSRVLWLRQDOFKDQJHVWKDW
PLJKW LQWURGXFH WR[LFLW\ $VVXPLQJ WKDW DGHTXDWH DQDO\WLFPHWKRGVDQGVFUHHQLQJ SURWRFROV
H[LVW DQLVVXHWKDWWKHFRPPLWWHHGLGQRWH[DPLQHGXULQJLWVGHOLEHUDWLRQV DQGDUHDSSOLHG
WKHSRVVLELOLW\RIVXFKWR[LFLW\SRVHVDORZOHYHORIIRRGVDIHW\FRQFHUQWRWKHFRPPLWWHH


)DUPLQJ

,I JHQHWLF WHFKQRORJ\ EHFRPHV PRUH HIILFLHQW DQG DIIRUGDEOH WKH SULPDU\ IDUPLQJ
DSSOLFDWLRQV RI WUDQVJHQHVLV DQG FORQLQJ OLNHO\ ZLOO EH WR SURGXFH DQLPDOV ZLWK LQFUHDVHG
JURZWK LPSURYHG IHHG FRQYHUVLRQ OHDQHU PHDW LQFUHDVHG PXVFOH PDVV LPSURYHG ZRRO

ϯϯϵ

TXDOLW\ LPSURYHG GLVHDVH UHVLVWDQFH DQG LQFUHDVHG UHSURGXFWLYH SRWHQWLDO 7KH WHFKQRORJ\
DOVRFDQEHXVHGWRSURGXFHIRRGRILPSURYHGQXWULWLRQDOTXDOLW\ QXWUDFHXWLFDOV RUDSSHDO
7KHSULPDU\GLIIHUHQFHEHWZHHQWUDGLWLRQDOEUHHGLQJDQGJHQHWLFHQJLQHHULQJLVWKHVSHHGDW
ZKLFK FKDQJH W\SLFDOO\ RFFXUV DOWKRXJK QDWXUDOO\ RFFXUULQJ PXWDWLRQV DQG UHFRPELQDWLRQ
HYHQWVDOVRFDQFDXVHUDSLGDQGGUDPDWLFFKDQJH DQGWKHVLQJOHJHQHQDWXUHRIJHQHWLFDOO\
HQJLQHHUHGFKDQJH

7UDGLWLRQDO PHWKRGV RI VHOHFWLRQ DUH PRUH OLNHO\ WR EH VXEMHFW WR WKH FKHFNV DQG
EDODQFHV LPSRVHG E\ QDWXUDO VHOHFWLRQ 0DQ\ UHODWHG DQG DSSDUHQWO\ XQUHODWHG WUDLWV DUH
FRUUHODWHG JHQHWLFDOO\ WKXV VHOHFWLYH EUHHGLQJ LQYROYHV VHOHFWLQJ IRU D ZKROH SKHQRW\SH
UDWKHUWKDQDVLQJOHJHQHSURGXFW%HFDXVHPRVWSURGXFWLRQDQGEHKDYLRXUDOWUDLWVLQOLYHVWRFN
DUHSRO\JHQLFDQGRXUXQGHUVWDQGLQJRIOLYHVWRFNJHQRPHVLVSRRUIHZWUDLWVFDQUHOLDEO\DQG
SUHGLFWDEO\EHHQJLQHHUHGRULQWURGXFHGE\PDQLSXODWLQJRQO\RQHJHQH)RUWKLVUHDVRQWKH
SURGXFWLRQ RI D OLQH RI WUDQVJHQLFV ZLOO UHTXLUH JHQHUDWLRQV RI VHOHFWLYH EUHHGLQJ DIWHU WKH
LQWURGXFWLRQRIJHQHFRQVWUXFWVLQWRWKHIRXQGHUJHQHUDWLRQWRHQVXUHWKDWDQLPDOVGLVSOD\WKH
GHVLUHGSKHQRW\SHZLWKIHZRUQRXQGHVLUDEOHVLGHHIIHFWV+RZHYHU LW LV FOHDUWKDW VHULRXV
ZHOIDUH SUREOHPV DOVR KDYH UHVXOWHG IURP WUDGLWLRQDO EUHHGLQJ WHFKQLTXHV %URLOHU FKLFNHQV
DUH D FDVH LQ SRLQW %UHHGLQJ IRU LQFUHDVHG JURZWK KDV OHG WR VHULRXV SK\VLFDO GLVDELOLWLHV
LQFOXGLQJ VNHOHWDO DQG FDUGLRYDVFXODU ZHDNQHVV $ ODUJH SHUFHQWDJH RI EURLOHUV KDYH JDLW
DEQRUPDOLWLHVDQGWKHVHPLJKWEHSDLQIXOPDNLQJLWGLIILFXOWIRUWKHELUGVWRZDONWRIHHGHUV
DQGZDWHUHUV,QDGGLWLRQEURLOHUKHQVPXVWEHVHYHUHO\IHHGUHVWULFWHGWRSUHYHQWREHVLW\DQG
WKLVIHHGUHVWULFWLRQLVDVVRFLDWHGZLWKH[WUHPHKXQJHUDQGDYDULHW\RIEHKDYLRUDOSUREOHPV
LQFOXGLQJSUREOHPVZLWKPDWLQJEHKDYLRXUDQGK\SHUDJJUHVVLYHQHVV7UDGLWLRQDOVHOHFWLRQRI
SLJVIRULQFUHDVHGOHDQQHVVKDVOHGWRLQFUHDVHGH[FLWDELOLW\GXULQJKDQGOLQJDQGVHOHFWLRQIRU
KLJK UHSURGXFWLYH UDWHV HLWKHU E\ VKRUWHQLQJ WKH LQWHUYDO EHWZHHQ ELUWKV RU LQFUHDVLQJ WKH
QXPEHURIRIIVSULQJERUQ RULQFUHDVHGODFWDWLRQDOVRKDVOHGWRZHOIDUHSUREOHPV

3RWHQWLDODQLPDOZHOIDUHEHQHILWV

*HQHWLFHQJLQHHULQJFHUWDLQO\KDVWKHSRWHQWLDOWRLPSURYHWKHZHOIDUHRIIDUPDQLPDOV
'HFUHDVLQJ PRUWDOLW\ DQG PRUELGLW\ E\ LQFUHDVLQJ UHVLVWDQFH WR GLVHDVHV RU SDUDVLWHV RU
GHFUHDVLQJUHVSRQVHVWRLQJHVWLRQRIWR[LFSODQWVDUHREYLRXVH[DPSOHVRIZHOIDUHEHQHILWV
DQGDQDUHDLQZKLFKVRPHWUDQVJHQLFUHVHDUFKLVIRFXVHG,WDOVR KDV EHHQ SRLQWHG RXW WKDW
WUDQVJHQLF DQLPDOV PLJKW UHFHLYH D KLJKHU VWDQGDUG RI FDUH WKDQ QRQWUDQVJHQLF DQLPDOV
EHFDXVH RI WKHLU JUHDWHU HFRQRPLF YDOXH &ORQLQJ FRXOG EH XVHG DV D VWUDWHJ\ IRU EUHHG
SUHVHUYDWLRQWRPDLQWDLQJHQHVWKDWDUHLPSRUWDQWIRUDGDSWDWLRQDQGUHVLVWDQFHWRGLVHDVHEXW
HTXDOO\FRXOGUHVXOWLQDIXUWKHUQDUURZLQJRIWKHJHQHSRROZLWKSRVVLEO\GHOHWHULRXVHIIHFWV
RQDQLPDOKHDOWK

,PSURYLQJ GLVHDVH UHVLVWDQFH WR GHFUHDVH SDLQ DQG VXIIHULQJ LV DQ DSSOLFDWLRQ RI
WUDQVJHQLF WHFKQRORJ\ WKDW KDV FOHDU DQLPDO ZHOIDUH EHQHILWV %XW LW VKRXOG EH VWUHVVHG WKDW
DQLPDO ZHOIDUH LV PXOWLIDFHWHG DQG WKLV QHHGV WR EH WDNHQ LQWR DFFRXQW ZKHQ DVVHVVLQJ
ZHOIDUH LPSDFWV RI WKH DSSOLFDWLRQ RI DQ\ WHFKQRORJ\QRW MXVW ELRWHFKQRORJ\ ,PSRUWDQW
HOHPHQWV RI DQLPDO ZHOIDUH LQFOXGH IUHHGRP IURP GLVHDVH SDLQ RU GLVWUHVV SK\VLRORJLF
QRUPDOLW\DQGWKHRSSRUWXQLW\WRSHUIRUPQRUPDOEHKDYLRXUV:KLOHUHGXFLQJGLVHDVHFOHDUO\
LVEHQHILFLDOLIWKLVDOVRSHUPLWVDQLPDOVWREHFRQILQHGPRUHFORVHO\DQGWKXVGHFUHDVHVWKH
RSSRUWXQLW\IRUWKHPWRSHUIRUPWKHLUQRUPDOEHKDYLRUVWKHQWKHQHWHIIHFWRQZHOIDUHFRXOG
EHQHJDWLYH



ϯϰϬ

 &KDSWHU
3LVFLWHFKQRORJ\DQGDTXDWLFELRWHFKQRORJ\

)LVKHULHV

6LQFHWKHODWH¶VFDSWXUHILVKHULHVODQGLQJVKDYHEHHQOHYHOOLQJRIIDWPLOOLRQ
PHWULFWRQV PPW DQGWKLV SURGXFWLYLW\ LVSUHVHQWO\UHJDUGHGDVQHDUWKHXSSHUOLPLW,QWKH
ODVW GHFDGH DW OHDVW  PDMRU ILVKHULHV KDYH FROODSVHG DURXQG WKH ZRUOG ZKLFK ZDV TXLWH
FORVHO\ PRQLWRUHG DQG VXSSRVHGO\ UDWLRQDOO\ PDQDJHG $V RI   RI WKH WDUJHW ILVK
VWRFNVZHUHDOUHDG\GHSOHWHGZDVRYHUH[SORLWHGDQGIXOO\WRKHDYLO\H[SORLW7KLV
HPHUJLQJ DZDUHQHVV RI WKH YXOQHUDELOLW\ RI PDULQH UHVRXUFHV WKURZV GLVFUHGLW RQ WKH
FRPSODFHQW YLHZ WKDW VHDILVKHULHV DUH HVVHQWLDOO\ LQH[KDXVWLEOH EHFDXVH FRPSHQVDWRU\
UHVLOLHQFHRIWDUJHWILVKVWRFNVZRXOGEHHQVXUHGE\WKHLUJUHDWIHFXQGLW\DQGYDJLOLW\

:LWK D JURZLQJ FRQFHUQ DERXW HFRV\VWHPLF LPSDFWV E\ ILVKHULHV RYHUILVKLQJ
GHVWUXFWLRQ RI EHQWKLF FRPPXQLWLHV E\ GUHGJLQJ WUDZOLQJ DQG RWKHU GLVUXSWLYH ILVKLQJ
SUDFWLFHV SHUWXUEDWLRQ RI IRRG ZHEV E\ WKH QRQVHOHFWLYH UHPRYDO RI WDUJHW DQLPDOV ZLWK
FRQVHTXHQWPDVVLYHZDVWDJHRIQRQPDUNHWDEOHVSHFLHVHWF DVZHOODVDERXWHQYLURQPHQWDO
LPSDFWV RQ ILVKHULHV FKHPLFDO SROOXWLRQ IURP FRDVWDO UXQRIIV HXWURSKLFDWLRQ DQG DOJDO
EORRPV RLO VSLOOV PDULQH KDELWDW IUDJPHQWDWLRQ DQG GHJUDGDWLRQ LQWURGXFWLRQ RI IRUHLJQ
VSHFLHV PDQLQGXFHG JOREDO FKDQJHV RQ ZHDWKHU DQG RFHDQ SK\VLFV HWF  WKHUH DUH
GLVFRXUDJLQJ SHUVSHFWLYHV DERXW WKH FDSDELOLW\ RI FDSWXUH ILVKHULHV WR VDWLVI\ WKH DQWLFLSDWHG
LQFUHDVH LQ WKH GHPDQG IRU VHDIRRG E\ WKH H[SDQGLQJ KXPDQ SRSXODWLRQ $FWXDOO\
LPSURYHPHQWVLQILVKHU\PDQDJHPHQWDUHH[SHFWHGWRUHO\RQPRUHSUHFDXWLRQDU\DSSURDFKHVW
R ILVKLQJ HIIRUW DQG KDUYHVWLQJ SUHVVXUH LPSOHPHQWDWLRQ RI PDULQH UHVHUYHV DQG WHPSRUDU\
³QRWDNH´]RQHVHQIRUFHPHQWRIPRUDWRULDDGRSWLRQRIPRUHVHOHFWLYHILVKLQJJHDUVDQGRWKHU
UHPHGLDO PHDVXUHV WKDW DUH OLNHO\ WR VDFULILFH VKRUWWHUP HFRQRPLF JDLQV LQ IDYRXU RI PRUH
VXVWDLQDEOHWKRXJKGLPLQLVKHGFDWFKHV

,Q WKH 0HGLWHUUDQHDQ 6HD WKH VLWXDWLRQ LV SDUWLFXODUO\ FULWLFDO RZLQJ WR LWV UHODWLYHO\
VPDOO H[WHQVLRQ PRGHUDWH RYHUDOO ELRSURGXFWLYLW\ DQG JUHDW QXPEHU RI FRXQWULHV ZLWK
JUDYLWDWLQJ ILVKHULHV $ UHJXODWLRQ IURP WKH (XURSHDQ &RPPXQLW\ HQIRUFHV WHFKQLFDO
PHDVXUHVWRSUHVHUYHWKH0HGLWHUUDQHDQILVKLQJUHVRXUFHV7KHVHPHDVXUHVWKDWHVWDEOLVKWKH
PLQLPDOQHWPHVKHVDQGILVKVL]HVIRUILVKLQJDFWLYLW\VKRXOGEHFRPSOHPHQWHGLQWKHIXWXUH
E\FRRSHUDWLYHDJUHHPHQWVDPRQJDOOLQWHUHVWHGQDWLRQVDERXWPRUHHIIHFWLYHDSSURDFKHVIRU
ILVKVWRFNDVVHVVPHQWDQGFRQVHUYDWLRQ


*HQHUDOWHFKQRORJ\IRU)LVKSURSDJDWLRQ
2QHSUHUHTXLVLWHRILQWHQVLYHILVKFXOWXUHWHFKQRORJ\LVWRKDYHKHDOWK\ILVKVHHGLQWKH
UHTXLUHGDPRXQWDYDLODEOH7KLVFDQEHUHDOL]HGRQO\ZLWKSUHOLPLQDU\SURSDJDWLRQSODQQLQJ
%HVLGHV QDWXUDO DQG VHPLDUWLILFLDO SURSDJDWLRQDUWLILFLDOSURSDJDWLRQFDUULHGRXWLQDZHOO
HTXLSSHG KDWFKHU\ LV WKH XSWRGDWH ZD\ LQ ZKLFK WKH QHFHVVDU\ TXDQWLW\ RI IU\ FDQ EH
SURGXFHG

&XOWXUHDQG0DQDJHPHQWRI%URRG6WRFN
$EDVLFSUHFRQGLWLRQRIILVKSURSDJDWLRQLVWRKDYHVH[XDOO\PDWXUHPDOHDQGIHPDOH
ILVK SURGXFLQJ PLOW DQG HJJV %UHHGHUV RI ILVK VSHFLHV ZKLFK FDQQRW EH FXOWXUHG RU NHSW

ϯϰϭ

 GRPHVWLFDOO\ DUH FROOHFWHG EHIRUH VSDZQLQJ IURP ULYHUV RU ODNHV WKHLU PLOW RU HJJV DUH
VWULSSHG DQG WKHQ WKH\ DUH UHOHDVHG DJDLQ 7KHVH VSHFLHV DUH VWXUJHRQV PXOOHWV  PXJLOV
0XJLOLGDH DQGVDOPRQLGV 6DOPRQLGDH 
7KH EURRG VWRFN RI FXOWXUHG ILVK VSHFLHV DUH VRUWHG RXW ZLWK DLPHG VHOHFWLRQ DQG
FXOWXUHGLQILVKSRQGVXSWRVH[XDOPDWXULW\7KHPDOHVDQGIHPDOHVRIEUHHGHUVDUHFXOWXUHG
LQWKHVDPHILVKSRQGZKLOHWKH\DUH\RXQJ 7KHQZKHQVH[XDOO\PDWXUHWKH\DUHVHOHFWHG
DQGFXOWXUHGLQVHSDUDWHILVKSRQGV

(QYLURQPHQWDO&RQGLWLRQVIRU&XOWXULQJ%UHHGHUV
:KHQ FXOWXULQJ EUHHGHUV WKH IROORZLQJ HQYLURQPHQWDO FRQGLWLRQV VKRXOG EH HQVXUHG
FRQVLGHULQJ WKH VSHFLILF GHPDQGV RI WKH UHVSHFWLYH VSHFLHV 6XLWDEOH ZDWHU DQG SRQG
WHPSHUDWXUHR[\JHQDQGIHHGOLJKWSKRWRSHULRG
'XULQJFXOWXULQJRI EUHHGHUV WKH ZDWHU TXDOLW\ VKRXOG PHHWWKHVDPHUHTXLUHPHQWDV
GXULQJURXWLQHILVKFXOWXUH
)RUVSHFLHVZLWKSUHIHUHQFHIRU VWLOO ZDWHU HJF\SULQLGV FDWILVKWLODSLD HDUWKHQRU
FRQFUHWHZDOOHG ILVK SRQGV VKRXOG EH FRQVWUXFWHG )RU UKHRSK\O VSHFLHV HJ WURXW  IORZ
WKURXJKV\VWHPVFDQDOVRUWDQNVZLWKFLUFXODWLQJZDWHUVKRXOGEHSURYLGHG
7KHWHPSHUDWXUHDVDQHQYLURQPHQWDOIDFWRUKDVDQLPSRUWDQWUROHLQILVKFXOWXUH)LVK
DUHDSROLNLORWKHUPDQLPDOZKLFKPHDQVWKDWWKHLUERG\WHPSHUDWXUHIROORZVWKHVXUURXQGLQJ
WHPSHUDWXUH EXW LQ FDVH RI LQFUHDVHG PXVFXODU ZRUN DQG PHWDEROLVP LW FDQ EH VRPHZKDW
KLJKHU  )LVK FDQ EH ZDUP ZDWHU RU FROGZDWHU VSHFLHV &ROGZDWHU ILVK DUH VDOPRQLGV DQG
WURXW7KHLURSWLPDOWHPSHUDWXUHUDQJHLVƒ&DQGWKHLUR[\JHQGHPDQGLVKLJK
:DUPZDWHUILVKDUHWKHF\SULQLGVOLNHFRPPRQFDUS&KLQHVHFDUS,QGLDQFDUSVDQG
IURP RWKHU IDPLOLHV WKH WLODSLD PLONILVK PXOOHW DQG WKH $PHULFDQ FDWILVK 7KHLU RSWLPDO
WHPSHUDWXUHUDQJHLVƒ&
7KHUHDUHVRPHVSHFLHVLQEHWZHHQWKH\UHSURGXFHLQFROGZDWHUEXWODWHUFDQOLYH
LQ ZDUP ZDWHUV WRR 6XFK DUH SLNH DQG SLNHSHUFK 7KH GHYHORSPHQW FDQ EH JUHDWO\
LQIOXHQFHG E\ ZDWHU WHPSHUDWXUH )HHGLQJ DW ORZ WHPSHUDWXUH FDQ EH QRUPDO EXW WKH
FRQYHUVLRQ RI WKH IHHG DQG FRQVHTXHQWO\ WKH JURZWK HVSHFLDOO\ VH[XDO PDWXUDWLRQ FDQ EH
FRQVLGHUDEO\ VORZHU 7KH GXUDWLRQ RI VH[XDO PDWXUDWLRQ DOVR GHSHQGV ILUVW RI DOO RQ WKH
HQYLURQPHQWDO WHPSHUDWXUH ZLWK PRVW ILVK VSHFLHV WKXV WKHUH LV D FKDUDFWHULVWLF WRWDO
WHPSHUDWXUHYDOXHIRUHDFKVSHFLHVZKLFKLVQHFHVVDU\IRUJDPHWRJHQHVLV
,QWKHFDVHRIFDUSIURPKDWFKLQJWRWKHILUVWUHSURGXFWLRQGHJUHHGD\VRI
KHDWLVQHFHVVDU\7KLVTXDQWLW\RIKHDWXQGHUDWURSLFDOFOLPDWHLVHQVXUHGLQOO\HDUVZKLOH
LQ0LGGOH(XURSHLQ\HDUV
GHJUHHGD\VLVQHFHVVDU\LQWKHSURSHUWHPSHUDWXUHUDQJHIRUWKHRRJHQHVLV
RI PDWXUHG FDUSV EHWZHHQ WZR SURSDJDWLRQV ,I WKH WHPSHUDWXUH LV ORZHU WKDQ WKDW
FRQVLGHULQJWKHGD\VZLWKWHPSHUDWXUHKLJKHUWKDQƒ&RQO\LWLVGHJUHHGD\V
7KHPLQLPXPWHPSHUDWXUHZKLFKLVQHFHVVDU\IRUSURSDJDWLRQRIFDUSVLVƒ&EHORZWKLV
YDOXHWKHJDPHWRJHQHVLVLVYHU\VORZ
2SWLPDO R[\JHQ FRQWHQW RI ZDWHU LV YHU\ LPSRUWDQW HVSHFLDOO\ LQ DFWLYH F\WRJHQHWLF
SURFHVVHV 'HYHORSPHQW RI JDPHWHV DQG FRPSOHWH FRQYHUVLRQ RI IHHG DUH DOO R[\JHQ
FRQVXPLQJ SURFHVVHV ,Q FDVH RI R[\JHQ GHILFLHQF\ WKH JHPDWRJHQHVLV VORZV GRZQ

ϯϰϮ

 GHYHORSPHQW LV LQKLELWHG DQG LI LW LV SURORQJHG WKH UHVRUSWLRQRIJDPHWHV VWDUWV 7KHUHIRUH
WKHSURSHUR[\JHQVXSSO\LVDFUXFLDOSRLQWRIEURRGVWRFNFXOWXUH
)HHGLQJ RI EUHHGHUV HVSHFLDOO\ LQ WKH QXWULPHQW DFFXPXODWLQJ SKDVH RI RRJHQHVLV
UHTXLUHV IHHG RI VSHFLILF FRPSRVLWLRQ $PLQR DFLGV FDUERK\GUDWHV IDWV YLWDPLQV DQG
PLQHUDOV DUH DYDLODEOH IRU WKH ILVK YLD QDWXUDO IHHGLQJ %XW DW KLJK VWRFNLQJ GHQVLW\ XQGHU
FRQWUROOHG FXOWXULQJ FRQGLWLRQV WKHVH PXVW EH SURYLGHG WKURXJK DUWLILFLDO IHHG ,W LV DOVR
LPSRUWDQW WKDW WKH EUHHGHUV FDQ JHW WKH W\SH RI IHHG FKDUDFWHULVWLF RI WKHLU VSHFLHV LH
KHUELYRURXVILVKVKRXOGJHWQXWULPHQWRISODQWRULJLQDQGFDUQLYRURXVVKRXOGJHWQXWULPHQW
RIDQLPDORULJLQ
/LJKWSKRWRSHULRG KDV D VLJQLILFDQW UROH LQ WKH UHSURGXFWLYH SURFHVVHV RI VHYHUDO ILVK
VSHFLHV
6WUHVVIDFWRUVDQGWKHVHQVLWLYLW\RIWKHFXOWXUHGEUHHGHUVWRWKHVHIDFWRUVDOVRVKRXOG
EH NHSW LQ PLQG +DQGOLQJ WUDQVSRUWDWLRQ HQFORVXUH ZKLFK DOO GLIIHUV IURP WKHLU QRUPDO
OLYHV DUH VWUHVV LQGXFLQJ IDFWRUV DQG PD\ DIIHFW WKHLU FRQGLWLRQ 7KLV PD\ KLQGHU WKH ODVW
SKDVH RI PDWXUDWLRQ DQG RYXODWLRQ 7KHUHIRUH FRQGLWLRQV VKRXOG EH HVWDEOLVKHG IRU WKH
EUHHGHUVZKHUHDOOWKHVHVWUHVVIDFWRUVFDQEHPLQLPL]HG

x 6WRFNLQJGHQVLW\PXVWEHRSWLPDOWKXVHQVXULQJDVXSSO\RIQDWXUDOIRRG
x :DWHU VXSSO\ IORZ UDWH WHPSHUDWXUH DQG R[\JHQ FRQWHQW VKRXOG PHHW WKH
UHTXLUHPHQWVRIWKHILVK
x %UHHGHUV GXULQJ VSDZQLQJ DUH NHSW LQ VPDOOHU VL]H ILVK SRQGV RU FRQFUHWH WDQNV
7KHLU ILOOLQJ RU GUDLQLQJ VKRXOG EH HIILFLHQW EHFDXVH WKH ILVK PXVW EH FDXJKW YHU\
RIWHQ
x %UHHGHUVFDQEHWUDQVSRUWHGLQWDQNVRQO\PDLQWDLQLQJWKHSURSHUR[\JHQFRQWHQWE\
VSUD\LQJOLTXLGR[\JHQ
x &DVHRIWLPLGILVK HJ&KLQHVHFDUSV VHGDWLYHVFDQEHDGGHGWRWKHZDWHU
x :KHQKDQGOLQJLVQHFHVVDU\WKHVHLQHFDQEHDSSOLHG0DQXDOWUDQVSRUWDWLRQRIILVK
QHHGVVNLOOVRZHOOWUDLQHGILVKHUPHQVKRXOGGRLW,IWKHEUHHGHUZLWKHJJVLVGURSSHG
LWPD\ORVHWKHHJJVWKHRYDU\LQIODPHVDQGLQPRVWFDVHVWKHILVKGLHV

3UDFWLFDOWHFKQRORJLHVRIWKHDUWLILFLDOSURSDJDWLRQRIFXOWLYDWHG)LVKVSHFLHV

&RPPRQFDUS
6SHFLHV&RPPRQFDUS &\SULQXVFDUSLR/ 
2ULJLQ&KLQD6RXWK$VLD(XURSH
1DWXUDOKDELWDW5LYHUVODNHVILVKSRQGV
)HHGLQJDQGQXWULWLRQ=RRSODQNWRQZDWHULQVHFWVDQGWKHLUODUYDHERWWRPLQKDELWLQJ
RUJDQLVPVJUDLQVDQGJUDQXODUDQGSHOOHWIRRGV
:HLJKWDWDJHLQWHUYDOV (XURSHRQO\ 
<HDU *UDPV
 
 
 
 
 

ϯϰϯ

5HSURGXFWLRQ
,QDQDWXUDOHQYLURQPHQWWKHILVKVSDZQLQJURXSVLQODNHVDQGVORZPRYLQJULYHUVDW
DZDWHUWHPSHUDWXUHRIWRƒ&7KHHJJDWWDFKHVLWVHOIWRYHJHWDWLRQDQGKDWFKHVZLWKLQ
WKUHHGD\V,QH[WHQVLYHFXOWLYDWLRQWKH\DUHVSDZQHGLQVPDOOSRQGV

(FRQRPLFFKDUDFWHUL]DWLRQ
5DSLG JURZWK +LJK GHJUHH RI IHFXQGLW\ +LJK PHDW TXDOLW\ WKRXJK FRQWDLQLQJ
LQWHUPXVFXODUERQHDQGYHU\VXLWDEOHWRZDUPZDWHUSRO\FXOWXUH*RRGVSRUWILVK
 

&KLQHVH+HUELYRURXV)LVKHV
6SHFLHV
6LOYHU&DUS +\SRSKWKDOPLFKWK\VPROLWUL[9DO 6& 
%LJKHDG&DUS $ULVWLFKWK\VQRELOLV 
*UDVV&DUS &WHQRSKDU\QJRGRQLGHOOD9DO  *& 

2ULJLQ6RXWKHDVW$VLD
1DWXUDOKDELWDW/DUJHULYHUVZDUPZDWHUODNHVILVKSRQGV
)HHGLQJDQGQXWULWLRQ
6LOYHU&DUS 6& SK\WRSODQNWRQGLHW
%LJKHDG&DUS %& ]RRSODQNWRQGLHW
*UDVV&DUS *& DTXDWLFPDFURSK\WHGLHW
6L]HDWDJHVLQJUDPV
<HDUV 6& %& *&
 2FW  2FW
   

   

   

   

   

5HSURGXFWLRQ
,QVORZO\IORZLQJZDUPULYHUVWKH\VSDZQLQJURXSV
,QFXOWXUHGFRQGLWLRQVVSDZQLQJRFFXUVRQO\DUWLILFLDOO\
6SDZQLQJWHPSHUDWXUHƒ&
7KHHJJVDUHSHODJLF

(FRQRPLFFKDUDFWHUL]DWLRQ
*RRGTXDOLW\RIPHDW
*RRGVSRUWILVKLQJ *& 
,QSRO\FXOWXUHWKH\XWLOL]HWKHSULPDU\DQGVHFRQGDU\SURGXFWLRQRIWKHZDWHUGLUHFWO\*&
FRQWUROVWKHPDFURSK\WHVLQODNHVDQGFKDQQHOV

ϯϰϰ

$UWLILFLDOSURSDJDWLRQ
7KHVWRFNPDWHULDOLVNHSWLQDVSHFLDOSRQGDQGWKHVWRFNLQJUDWHSHUKHFWDUH KD 
$JHE\VSDZQLQJLQ\HDUV
 )HPDOH 0DOH
6&  
%&  
*&  

6H[XDOGLIIHUHQWLDWLRQ
7KHILUVWKDUGUD\VRIWKHSHFWRUDOILQVRIWKHPDOHDUHVKDUSZKLOHWKRVHRIWKHIHPDOHDUH
VPRRWK

(XURSHDQ&DWILVK

6SHFLHV(XURSHDQFDWILVK 6KHDWILVK6LOXUXVJODQLV/ 
2ULJLQDW\SLFDOO\(XURSHDQVSHFLHV
1DWXUDOKDELWDW5LYHUVODNHVDUWLILFLDOSRQGV
)HHGLQJFDUQLYRURXVSUHGDWRUZLOODOVRHDWFDUULRQ:HOOVXLWHGWRDUWLILFLDOIHHGV
:HLJKWDWDJHLQWHUYDOV
<HDU *UDPV
 
 
 
 
 
 

5HSURGXFWLRQ
,QQDWXUDOFLUFXPVWDQFHVWKHILVKXQFRYHUWKHURRWVRIDTXDWLFYHJHWDWLRQGHSRVLWLQJWKH
HJJV DPRQJ WKHVH URRWV 7KH HJJV FRKHUH LQWR D OXPS $IWHU KDWFKLQJ WKH ODUYDH UHPDLQ
KLGGHQKHUH6L[WRHLJKWGD\VODWHUWKHIU\HPHUJHVZLPPLQJDQGGHSDUWLQVHDUFKRIIRRG
,Q UHDULQJ SRQGV WKH\ VSDZQ RQ DUWLILFLDO QHVWV ZKLFK DUH WKHQ UHPRYHG WR WKH
KDWFKHU\0D\EHDUWLILFLDOO\SURSDJDWHGLQKDWFKHULHV5HTXLUHGWHPSHUDWXUHIRUUHSURGXFWLRQ
LVƒ&

(FRQRPLFFKDUDFWHUL]DWLRQ
5DSLGJURZWK
*RRGTXDOLW\PHDWZLWKQRLQWUDPXVFXODUERQH
(DWVXQGHVLUDEOHVPDOOILVK
*RRGVSRUWILVK
:HOOVXLWHGWRSRO\FXOWXUH
'LVWLQJXLVKLQJVH[XDOFKDUDFWHULVWLFV
7KHIURQWDOSRUWLRQRIWKHKHDGDERXWWKHPRXWKLVDQJXODULQWKHPDOHZKLOHURWXQGLQWKH
IHPDOH
7KHJHQLWDOSDSLOODRIWKHPDOHLVSRLQWHGWKDWRIWKHIHPDOHEOXQWDQGURXQGHG

ϯϰϱ

3LNH3HUFK
6SHFLHV3LNHSHUFK 6WL]RVWHGLRQOXFLRSHUFD/ 
+DELWDW3UHIHUVR[\JHQULFKZDWHUV,WOLYHVLQULYHUVODNHVUHVHUYRLUVDQGILVKSRQGV
)HHGLQJ,WLVDFDUQLYRURXVSUHGDWRUIHHGLQJPDLQO\RQVPDOOILVK
:HLJKWDWDJHLQWHUYDOV
<HDU *UDPV
 
 
 
 

5HSURGXFWLRQ
,Q LWV QDWXUDO HQYLURQPHQW LW XQFRYHUV WKH URRWV RI DTXDWLF YHJHWDWLRQ GHSRVLWLQJ WKH RYD
DPRQJWKHP7KHPDOHWKHQIHUWLOL]HVWKHHJJV,WVSDZQVLQSDLUVDQGJXDUGVWKHRYDXQWLO
WKH\KDWFK7HPSHUDWXUHDWVSDZQLQJƒ&

(FRQRPLFFKDUDFWHUL]DWLRQ
,WVPHDWLVRXWVWDQGLQJDQGFRQWDLQVQRLQWUDPXVFXODUERQH
*RRGVSRUWILVK
,QSRO\FXOWXUHLWFRQVXPHVVPDOOILVKRIQRYDOXH
 ,W GRHV QRW ZLWKVWDQG ZHOO WKH KDQGOLQJ QHFHVVDU\ LQ KDUYHVWLQJ DQG WUDQVSRUWDWLRQ WKXV
UHTXLULQJH[WUDRUGLQDULO\FDUHIXOWUHDWPHQW

3URSDJDWLRQ
&DUHRIWKHEURRGVWRFN
,QWKHDXWXPQWKHEURRGVWRFNLVKDUYHVWHGIURPQDWXUDOZDWHUVRUILVKSRQGV
7KHVWRFNLVSODFHGLQZLQWHULQJSRQGVZLWKRXWVHJUHJDWLRQE\VH[
:LQWHULQJVSDFHUHTXLUHPHQWLVWRPSHUILVK
6PDOOILVKDWWKHUDWHRIWRRIWKHEURRGVWRFNE\ZHLJKWDUHSODFHGLQWKHSRQG
&RQWLQXRXVZDWHUFLUFXODWLRQPXVWEHHQVXUHGLQWKHZLQWHULQJSRQGV

6H[XDOGLIIHUHQWLDWLRQ
 7KH IHPDOH V EHOO\ LV IXOO URXQGHG DQG LWV JHQHUDO DUHD LV ZKLWH LQ FRORU
7KHPDOH VEHOO\LVIODWWHULWVDUHDJUD\

6HPL$UWLILFLDO3URSDJDWLRQRI,QGLDQ&DUSV
6SHFLHV
&DWODFDWOD +DPLOWRQ  &DWOD 
/DEHRURKLWD +DPLOWRQ  5RKX 
&LUUKLQXVPULJDOD +DPLOWRQ  0ULJDO 
2ULJLQ,QGLD3DNLVWDQ%DQJODGHVK%XUPD
1DWXUDOKDELWDW5LYHUVODNHVILVKSRQGV

ϯϰϲ

 )HHGLQJ
&DWODFDWOD]RRSODQNWRQSK\WRSODQNWRQLQVXUIDFHVWUDWD
/DEHRURKLWD]RRSODQNWRQDORQJWKHZKROHZDWHUFROXPQ
&LUUKLQXVPULJDODRPQLYRURXVERWWRPIHHGHU
$JHGHSHQGHQWVL]HRIILVK
<HDU &DWOD 5RKX 0ULJDO
PP PP PP
   
   
   
   
   

3URSDJDWLRQ
6SDZQLQJLQULYHUVGXULQJPRQVRRQUDLQV
6SDZQLQJFDQEHLQGXFHGVHPLDUWLILFLDOO\
2SWLPDOWHPSHUDWXUHRIVSDZQLQJLVƒ&
(JJVDUHIORDWLQJQRWVWLFN\

(FRQRPLFIHDWXUHV
$SSOLFDEOHLQLQWHQVLYHSRO\FXOWXUHWHFKQRORJLHVDQGWKHPHDWLVWDVW\LPSRUWDQWIRRG

:D\RIGLVWLQJXLVKLQJPDOHRUIHPDOHVSDZQHUV
7KH EHOO\ RI IHPDOH LV VZROOHQ JHQLWDO RUJDQ LV UHG XSRQ OLJKW SUHVVXUH WKH PDOH
SURGXFHVZKLWHPLON\GURSV7KHKDUGUD\RISHFWRUDOILQLVURXJKZLWKWKHPDOHDQGVPRRWK
ZLWKWKHIHPDOH


$UWLILFLDOSURSDJDWLRQ
5HDULQJ DQG NHHSLQJ RI WKH EURRG VWRFN WKH \RXQJ EURRG VWRFN LV VHOHFWHG IURP WKH
RIIVSULQJ RI SDUHQWV RI NQRZQ TXDOLW\  7KH VHOHFWLRQ FULWHULD DUH 5DSLG JURZWK *RRG
YLDELOLW\ +LJK IRRG FRQYHUVLRQUDWH /RZ IDW FRQWHQW DQG UHVLVWDQFH WR GLVHDVH 7KH EURRG
VWRFNLVUHDUHGLQLQGLYLGXDOSRQGVVHJUHJDWLQJPDOHDQGIHPDOH7KHVWRFNLQJGHQVLW\RIWKH
UHDULQJSRQGVLVWRDGXOWVSHUKHFWDUH
)HHGLV DQDUWLILFLDOSHOOHWFRQWDLQLQJWRSHUFHQW RISURWHLQ RI ZKLFK  WR 
SHUFHQWLVDQLPDOSURWHLQIDWVWRSHUFHQWYLWDPLQSUHPL[SHUFHQWPLQHUDOSUHPL[
SHUFHQW 9LWDPLQV $ DQG ( DUH FULWLFDO )RU WZR PRQWKV EHIRUH SURSDJDWLRQ WKH GDLO\ IHHG
VKRXOGFRQWDLQWRSHUFHQWRIUDZJURXQGPHDWRUKDUGERLOHGHJJV)HHGTXDQWLW\LVWR
SHUFHQWRIERG\ZHLJKWSHUGD\
6H[XDOO\ PDWXUH ILVK PHDVXUH  WR  FP DQG ZHLJK  WR  J 7KH ILVK
DFKLHYH VH[XDO PDWXULW\ LQ (XURSH IHPDOH  WR  \HDUV PDOH  WR  \HDUV ,Q WURSLFDO
FOLPDWHVIHPDOHWR\HDUVPDOH\HDU
7KHIHPDOHKDVDODUJHEHOO\7KHPDOHLIOLJKWO\VTXHH]HGDURXQGWKHEHOO\ZLOOHPLW
ZKLWHPLOW

ϯϰϳ

 +DQGOLQJRIWKHVSDZQHUV7KHVSDZQHUVVKRXOGEHPRYHGLQWRWKHKDWFKHU\RQHGD\
EHIRUH SURSDJDWLRQ 7KH VSDZQHUV VKRXOG EH WUDQVSRUWHG LQ FRQWDLQHUV PDGH RI LQRUJDQLF
QRQPHWDOOLFPDWHULDOV7KHPDOHDQGIHPDOHVSDZQHUVVKRXOGFRQWLQXHWREHVHJUHJDWHGLQ
WKH KDWFKHU\ LQ SODVWLF RU FRQFUHWH WDQNV 6SDFH UHTXLUHPHQW LV  WR PDGXOW 7DQNV
VKRXOGEHWRPWRPGHHS:DWHUTXDQWLW\UHTXLUHGLVWROLWUHVSHUILVKSHU
PLQXWH2[\JHQFRQWHQWRIWKHZDWHUVKRXOGEHWRPJO:DWHUWHPSHUDWXUHVKRXOGEH
WR ƒ&  %HIRUH KDQGOLQJ WKH ILVK PD\ EH WUDQTXLOL]HG 7KH WUDQTXLOL]HUUHFRPPHQGHG LV
06 6DQGR] LQDGLOXWLRQDQGDIWHUWRPLQXWHVLQWKHDERYHVROXWLRQWKH
ILVKVKRXOGEHPRYHGLQWRIUHVKZDWHURIKLJKR[\JHQFRQWHQWRWKHUZLVHWKH\ZLOOSHULVK
+\SRSK\VDWLRQ
7R LQGXFH RYXODWLRQ LQ WKH IHPDOH DQG PLOW SURGXFWLRQ LQ WKH PDOH KRUPRQH RI WKH
FDUS VSLWXLWDU\JODQGLVXVHG7KHGRVDJHXVHGLQWKHK\SRSK\VDWLRQRIWKHIHPDOHLVWR
PJ SHUNJ RI ERG\ ZHLJKW 7KH GRVDJH IRU WKH PDOH LV  PJ SHU NJ RI ERG\ ZHLJKW  7KH
GULHGSLWXLWDU\JODQGLVSXOYHUL]HGDQGGLVVROYHGLQDSHUFHQWVROXWLRQRIVDOW 1D&O 
PO VDOW VROXWLRQ SHU ILVK LV XVHG 7KH K\SRSK\VDWLRQ RI WKH IHPDOH VKRXOG EH GRQH LQ WZR
VWDJHVWHQSHUFHQWRIWKHGRVDJHLVJLYHQKRXUVEHIRUHWKHUHPRYDORIHJJVSHUFHQWRI
WKHGRVDJHLVJLYHQWRKRXUVEHIRUHWKHUHPRYDORIHJJVLIWKHZDWHUWHPSHUDWXUHLV
WRƒ& GHJUHHKRXUV 7KHLQMHFWLRQLVGRQHZLWKDILQHQHHGOHLQWRWKHPXVFOHRI
WKHEDFN%HIRUHZLWKGUDZDORIWKHQHHGOHWKHORFXVRIWKHLQMHFWLRQLVOLJKWO\PDVVDJHGWR
DYRLGOHDNDJHRIWKHVROXWLRQLQMHFWHG&RQFXUUHQWZLWKWKHVHFRQGLQMHFWLRQWKHRSHQLQJRI
WKHRYLGXFWLVVHZQXSWRSUHYHQWWKHORVVRIPDWXUHHJJVGXULQJWKHSHULRGRIRYXODWLRQ7KH
VXWXUH LV GRQH ZLWK VXUJLFDO LPSOHPHQWV 7KH PDOH LV WR EH LQMHFWHG  KRXUV EHIRUH WKH
GHVLUHGWLPHRIPLOW GLVFKDUJH ,W LVLPSHUDWLYH WKDW WKHILVK LQWKHKDWFKHU\KDYHDEVROXWHO\
TXLHWVXUURXQGLQJV
7KHUHPRYDORIHJJVDQGPLOWIHUWLOL]DWLRQ2QHKRXUEHIRUHUHPRYDORIWKHHJJVRQH
RUWZRPDOHVDUHSODFHGDPRQJWKHIHPDOHV$WWKHRQVHWRIRYXODWLRQWKHPDOHDQGIHPDOH
ILVK ZLOO VZLP DORQJVLGH RQH DQRWKHU IODSSLQJ IRUFHIXOO\ 2QH KDOI KRXU VKRXOG HODSVH WR
DVVXUH WKDW WKH IXOO TXDQWLW\ RI HJJV ZLOO KDYH GHWDFKHG LWVHOI IURPWKH ZDOOV RI WKH RYDU\
$IWHUWKLVWLPHWKHIHPDOHILVKDUHWUDQTXLOL]HG7KHVXWXUHVDUHUHPRYHGIURPWKHRSHQLQJ
RIWKHRYLGXFW7KHEHOO\RIWKHILVKVKRXOGEHZLSHGGU\ZLWKDFORWKWRSUHYHQWZHWWLQJWKH
HJJVZKLFKZLOOUDSLGO\ORVHWKHLUIHUWLOLW\LIPL[HGZLWKZDWHU7KHHJJVDUHUHOHDVHGLQWR
OLWUHSODVWLFGLVKHVLIQHFHVVDU\OLJKWSUHVVXUHPD\EHDSSOLHGWRWKHEHOO\WRPDNHWKHURH
IORZ RXW7KH PLOW LV SUHVVHG RXW RI WKH PDOH ZLWKOLJKW SUHVVXUH LQWR WHVW WXEHV 7KH HJJV
VKRXOGEHIHUWLOL]HGLPPHGLDWHO\XSRQWKHLUUHPRYDOIURPWKHIHPDOH7HQWRWZHQW\POPLOW
LVXVHGWRRQHOLWUHRIHJJV(DFKEDWFKRIHJJVVKRXOGEHIHUWLOL]HGZLWKPLOWIURPQROHVV
WKDQWKUHHPDOHVEHFDXVHWKHVSHUPRIDQ\PDOHPD\RFFDVLRQDOO\EHLQDFWLYH7KHHJJVDQG
PLOWDUHWKRURXJKO\PL[HG ZLWKRXWWKHDGGLWLRQRIDQ\ZDWHU VRWKDWDOOHJJVDUHUHDFKHGE\
WKHPLOW7KHPL[LQJVKRXOGEHGRQHZLWKDSODVWLFVSRRQ)HUWLOL]DWLRQLVSURPRWHGE\WKH
XVH RI D IHUWLOL]LQJ VROXWLRQ 7KH LQJUHGLHQWV RI WKH VROXWLRQ DUH ZDWHU  OLWUH
VDOW J XUHD J &21+  WHPSHUDWXUH RI WKH VROXWLRQ VKRXOG EH  WR ƒ& 7KH
IHUWLOL]LQJVROXWLRQKDVDWZRIROGHIIHFWLWSUHYHQWVWKHDGKHVLRQRIWKHHJJVDQGLWDFWLYDWHV
WKHVSHUPPORIWKHVROXWLRQLVDGGHGWROLWUHRIURHDQGLPPHGLDWHO\PL[HGZLWKLW
WKH PL[LQJ DFWLRQ VKRXOG EH FRQWLQXRXV DW WZR PLQXWH LQWHUYDOV DQRWKHU  PO RI WKH
VROXWLRQ LV DGGHG WR WKH PL[WXUH $IWHU WHQ PLQXWHV WKH IHUWLOL]LQJ VROXWLRQ LV SRXUHG RII
IUHVKIHUWLOL]LQJVROXWLRQLVDGGHGOLWUHVROXWLRQVWROLWUHRIHJJV7KHHJJVWRJHWKHUZLWK
WKHIHUWLOL]LQJVROXWLRQDUHWKHQSRXUHGLQWRDSODVWLFFRQWDLQHURIWROLWUHFDSDFLW\WKH
HJJV ZLOO VZHOO WR  WR  WLPHV WKHLU RULJLQDO YROXPH ZLWKLQ RQH KRXU )RU RQH KRXU WKH
IHUWLOL]LQJVROXWLRQVKRXOGEHH[FKDQJHGDWWHQPLQXWHLQWHUYDOVWRFRQWLQXHWRGLVVROYHDQG
UHPRYHWKHDGKHVLYHRIWKHHJJV0L[LQJVKRXOGEHGRQHLQWHUPLWWHQWO\DQGJHQWO\ZKHWKHU

ϯϰϴ

 PDQXDOO\RUPHFKDQLFDOO\$IWHURQHKRXURIWKHDERYH SURFHVV WKHHJJV VKRXOG EHWUHDWHG
ZLWK D WDQQLF DFLG VROXWLRQ WR GLVVROYH WKH DGKHVLYHV FRDJXODWHG GXULQJ WKH SUHYLRXV
WUHDWPHQW DQG VWLOO SUHVHQW RQ WKH VXUIDFH RI WKH HJJV 7KH WDQQLF VROXWLRQ FRQVLVWV RI 
JUDP WDQQLQ GLVVROYHG LQ  OLWUH ZDWHU WUHDWPHQW ZLWK WKH WDQQLF VROXWLRQ LV SUHFHGHG E\
SRXULQJ RII WKH IHUWLOL]LQJ VROXWLRQ DQG RQH WR WZR OLWUHV RI WDQQLF VROXWLRQ LV DGGHG WR WKH
HJJV DQG LPPHGLDWHO\ PL[HG LQ $IWHU WHQ VHFRQGV ZDWHU LV DGGHG WR GLOXWH WKH WDQQLF
VROXWLRQ7KHVROXWLRQLVWKHQLPPHGLDWHO\SRXUHGRII7KHHJJVVKRXOGWKHQEHULQVHGRU
WLPHVZLWKDPSOHTXDQWLWLHVRIZDWHUDQGDIWHUULQVLQJWKHHJJVDUHSODFHGLQKDWFKLQJMDUV
+DWFKLQJ
:DWHUWHPSHUDWXUHGXULQJ KDWFKLQJVKRXOGEHWRƒ&DQGRQHOLWUHRIKDWFKLQJMDU
YROXPHLVQHHGHGIRUHDFKHJJVZKHUHDVWKHYROXPHRIVZROOHQHJJVLVPO
7KH HJJV DUH D ULVN\ SURFHVV EHFDXVH WKH VHJPHQWDWLRQ RI WKH RYXP LV DOUHDG\ VWDUWHG DQG
VWURQJMROWLQJZLOOGHVWUR\LW6RWKHHJJVDUHSODFHGLQWKHZDWHUILOOHGKDWFKLQJMDUZLWKWKH
DLGRIDIXQQHOZKLFKLVHTXLSSHGZLWKDOHQJWKRIKRVHWRDVVXUHWKDWWKH\ZLOOH[LWIURPLW
XQGHU ZDWHU ,Q WKH ILUVW WHQ KRXUV WKH KDWFKLQJ MDU LV WR KDYH D PRGHUDWH IORZ RI ZDWHU
DVVXPLQJDOLWUHMDUWKHUDWHZRXOGEHWROPLQ$IWHUWHQKRXUVWKHIORZVKRXOGEH
LQFUHDVHGEHFDXVHWKHR[\JHQQHHGRIWKHRYDLVRQWKHULVHWRDUDWHRIWROPLQDQG
WKHHJJVZLOOEHGULIWLQJORRVHO\RQWKHERWWRPRIWKHKDWFKLQJMDU
)RXU WR ILYH KRXUV EHIRUH KDWFKLQJ WKH HPEU\RV  QHHG RI R[\JHQ LV FRQVLGHUDEOH
WKHUHIRUH WKH IORZ UDWH VKRXOG EH LQFUHDVHG WR  WR  OPLQ 2Q WKH VHFRQG GD\ RI WKH
KDWFKLQJSURFHVVWKHHJJVVKRXOGEHWUHDWHGZLWKPDODFKLWHJUHHQWRSUHYHQWWKHJHQHUDWLRQ
RIIXQJXV0DODFKLWHJUHHQLVDGGHGWRWKHZDWHULQWKHKDWFKLQJMDULQDTXDQWLW\WRJLYHD
VROXWLRQDQGOHWWKHVROXWLRQVWDQGIRUPLQXWHV$IWHUPLQXWHVWKHZDWHUIORZ
LV UHVWRUHG DQG WKH PDODFKLWH VROXWLRQ ZLOO WKHUHE\ EH VORZO\ ZDVKHG RXW +DWFKLQJ RI WKH
ODUYDHPD\EHH[SHFWHGRQWKHWKLUGGD\$IWHUWKHILUVWIHZODUYDHKDYHKDWFKHGWKHSURFHVV
VKRXOGEHDUWLILFLDOO\DFFHOHUDWHGZKLFKLVDFFRPSOLVKHGE\VKXWWLQJRIIWKHIORZRIZDWHUIRU
PLQXWHV7KHODFNRIR[\JHQDJLWDWHVWKHHPEU\RVDQGGXHWRWKHLUPRYHPHQWVWKHVKHOO
ZLOO VSOLW $IWHU  PLQXWHV WKH ZDWHU IORZ LV UHVWRUHG DQG KDWFKLQJ ZLOO VWDUW RQ D ODUJH
VFDOH7KHKDWFKHGODUYDHDUHWUDQVIHUUHGWRJHWKHUZLWKWKHZDWHULQWRODUYDHFRQWDLQHUV
0DLQWHQDQFHRIWKHODUYDH
7KHLPSOHPHQWVXVHGLQWKHPDLQWHQDQFHRIODUYDHPD\EHDQ\RQHRIWKHIROORZLQJ
&\OLQGULFDOFRQWDLQHUVFRQLFDODWWKHORZHUHQGRIWROLWUHFDSDFLW\RIJODVVSODVWLF
RUILEUHJODVV&LUFXODUIORZUDFHZD\VRIFRQFUHWHRUSODVWLF&DJHVPDGHRIQ\ORQFORWK
VFUHHQ 
&\OLQGHUV
,QWKHFRQWDLQHUVODUYDHSHUOLWUHRIZDWHUFDQEHPDLQWDLQHG:DWHUVKRXOGHQWHU
DWWKHERWWRPDQGIORZRXWDWWKHWRSRIWKHFRQWDLQHU7KHDUHDRIWKHRYHUIORZVFUHHQVKRXOG
EH  FPOLWUH RI FDSDFLW\ 7KH IORZ UDWH VKRXOG EH VXFK WKDW WKH ODUYDH DUH NHSW LQ
VXVSHQVLRQ EXW QRW ZDVKHG RQWR WKH RYHUIORZ VFUHHQ 7KH VFUHHQ VKRXOG EH FOHDQHG DW
LQWHUYDOV DV LW ZLOO EH VWRSSHG XS ZLWK UHPDLQV RI VKHOOV 7KH ODUYDH DUH NHSW LQ WKHVH
FRQWDLQHUVRQO\XQWLOWKHLUILUVWLQWDNHRIIHHG WRGD\V DIWHUZKLFKWKH\DUHWUDQVIHUUHGWR
UHDULQJ SRQGV 7KH DERYH SURFHVV LV WKH PRVW XSWRGDWH DQG PRVW K\JLHQLF PHWKRG RI
NHHSLQJWKHODUYDH
5DFHZD\V
7KHUDFHZD\VRISODVWLFRUFRQFUHWHVKRXOGEHRIWRPFDSDFLW\WKHGHSWKEHLQJ
WRFP:DWHUHQWHUVWKHUDFHZD\WKURXJKSHUIRUDWHGWXEHVSODFHGYHUWLFDOO\DWWZRRSSRVLWH
VLGHVWRDVVXUH DFLUFXODUIORZ7KHUDWHRIIORZVKRXOG EH VXFK WKDW LW SURGXFHVDFRQVWDQW

ϯϰϵ

VORZPRWLRQRIWKHZDWHU7KHRYHUIORZWXEHLVSODFHGLQWKHFHQWUHYHUWLFDOO\7KHRYHUIORZ
VFUHHQRIQ\ORQVKRXOGKDYHPPRSHQLQJV6XUIDFHDUHDRIWKHVFUHHQVKRXOGEHWR
FPOLWUH RI IORZ 7KH R[\JHQ FRQWHQW RI WKH ZDWHU LV LQFUHDVHG E\ VXUIDFH VSUD\LQJ 7KH
UDFHZD\VKRXOGEHVWRFNHGDWWKHUDWHRIKDWFKOLQJVSHUOLWUHRIZDWHU7KHDGYDQWDJHRI
WKLVPHWKRGLVWKDWWKHODUYDHFDQEHNHSWIRUVHYHUDOGD\VEH\RQGWKHILUVWIHHGLQJLIVXLWDEOH
QRXULVKPHQWFDQEHDVVXUHG
&DJHV
7KH VL]H LV îî FP IUDPH VKRXOG EH PDGH RI DOXPLQLXP RU SODVWLF WXELQJ DQG
6FUHHQLQJPDGHRIQ\ORQPPRSHQLQJ7KHFDJHVDUHNHSWLQSODVWLF RUFRQFUHWHWDQNV
$QXSZDUGIORZRIZDWHUWKURXJKWKHFDJHVLVQHHGHGZKLFKNHHSVWKHODUYDHLQPRWLRQ7KLV
LVDIIHFWHGE\OD\LQJWXELQJSHUIRUDWHGDWWKHWRSRQWKHWDQNERWWRP7KHERWWRPRIWKHFDJH
VKRXOGEHFOHDQHGWKHGD\DIWHUKDWFKLQJWRUHPRYHVKHOOVDQGXQKDWFKHGODUYDHZKLFKZLOO
VWDUWWRGHFRPSRVHWKXVFDXVLQJR[\JHQGHILFLHQF\7KHERWWRPDQGVLGHVRIWKHFDJHVKRXOG
EHFOHDQHGZLWKDEUXVKIURPWKHRXWVLGHDWKRXULQWHUYDOVWRDVVXUHIUHHSDVVDJHRIZDWHU
LQWRWKHFDJH7KHUDWHRIIORZLQWKHWDQNVVKRXOGEHWROPLQFDJH7RLQFUHDVHWKHR[\JHQ
FRQWHQWRIWKHZDWHUDILQHVXUIDFHVSUD\LQJVKRXOGEHXVHG
)HHGLQJDQGWUDQVSRUWDWLRQRIWKHEURRG
7KH PRXWK DQG JLOOV RI WKH FDUS ODUYD GHYHORS LQ  WR  GD\V 7KH FDUS V ODUYDO VWDJH
HQGVZLWKWKHILUVWLQWDNHRIIRRGDWWKLVSRLQWLWEHFRPHVIU\$WWKLVVWDJHWKH\RONVDFZLOO
KDYH EHHQ ODUJHO\ DEVRUEHG WKH KDWFKOLQJV ZLOO ULVH WR WKH VXUIDFH RI WKH ZDWHU ILOO WKH
VZLPPLQJEODGGHUVZLWKDLUDQGEHJLQWRVZLPKRUL]RQWDOO\DQGWKHILUVWIHHGLQJLVJLYHQ7KH
IHHG LV\RONRIKDUGERLOHG HJJ KHQ VRUGXFN V HJJ PL[HGLQDEOHQGHUZLWK ZDWHU PO
ZDWHU SHU RQH \RON LV XVHG DQG LV JLYHQ RQH WR WZR PO SHU  ILVK $V VRRQ DV WKH
KDWFKOLQJVEHJLQWRIHHGWKH\VKRXOGEHWUDQVIHUUHGWRSRQGV7KHGD\ROGIHHGLQJIU\DUH
WUDQVSRUWHG LQ SODVWLF EDJV FRQWDLQLQJ ZDWHU DQG R[\JHQ ,Q  OLWUHV ZDWHU SOXV  OLWUHV
R[\JHQDWƒ&ZDWHUWHPSHUDWXUHEURRGPD\EHNHSWXSWRKRXUVDWƒ&
EURRGPD\EHNHSWXSWRKRXUV,IFKLOOHGIRUWUDQVSRUWWKHWHPSHUDWXUH RIEURRGDQG
ZDWHUVKRXOGEHORZHUHGJUDGXDOO\7KHSODVWLFEDJVZKHQILOOHGVKRXOGEHDVILUPDVZHOO
ILOOHG EDOORRQV 7KH EDJV PXVW EH ZHOO WLHG WR SUHYHQW HVFDSH RI WKH R[\JHQ 7R DYRLG
UXSWXUH WKHEDJVVKRXOGEHSODFHGLQFDUGERDUGER[HV 7KHGD\ ROG ODUYD PHDVXUH  WR 
PPLQOHQJWK

$TXDFXOWXUH

:KLOH PDQ\ FDSWXUH ILVKHULHV DUH IDFLQJ GHFOLQLQJ RU VWDJQDQW KDUYHVWV WKHUH LV D
ZLGHVSUHDG FRQILGHQFH WKDW D JURZLQJ SRUWLRQ RI WKH QHFHVVDU\ SURGXFWLRQ WR VHFXUH IXWXUH
IRRGILVKDYDLODELOLW\ZLOOHYHQWXDOO\EHVXSSOLHGE\DTXDFXOWXUH7KLVH[SHFWDWLRQLVEDVHGRQ
WKHLPSUHVVLYHILJXUHVRIWRWDOZRUOGDTXDFXOWXUHJURZWKLQWKHSDVWGHFDGHZLWKDGRXEOLQJ
RI ODQGLQJV IURP  PPW LQ  WR  PPW LQ  ,Q WKLV VFHQDULR WKH SURGXFWLRQ
ILJXUHVRIPDULQHILVKFXOWXUHLQWKH0HGLWHUUDQHDQ%DVLQDUHFRPSDUDWLYHO\VPDOOEXWWKHLU
LQFUHPHQW LV QRQHWKHOHVV VWULNLQJ DV VHDEDVVVHDEUHDPIDUPLQJ KDV LQFUHDVHG VL[IROGLQ WKH
SHULRGUHDFKLQJDERXWWRQVSURGXFHGE\DOPRVWLQWHQVLYHHQWHUSULVHV

2QDJOREDOVFDOHDTXDFXOWXUHLVFXUUHQWO\RQHRIWKHIDVWHVWJURZLQJIRRGSURGXFWLRQ
V\VWHPV LQFUHDVLQJ DW DQ DQQXDO UDWH RI  FRPSDUHG WR  IRU WRWDO OLYHVWRFN PHDW
SURGXFWLRQ ,W LV HVWLPDWHG WKDW WR PDLQWDLQ FXUUHQW OHYHOV RI IRRG ILVK FRQVXPSWLRQ JOREDO
DTXDFXOWXUH SURGXFWLRQ VKRXOG EH GRXEOHG E\ WKH \HDU  DQG WUHEOHG E\  :KHWKHU
WKLVDQWLFLSDWLRQLVDQDFKLHYDEOHJRDOKRZHYHULVVWLOODQRSHQTXHVWLRQ$TXDFXOWXUHLVDQ
H[WUHPHO\KHWHURJHQHRXVLQGXVWU\GHYRWHGWRWKHIDUPLQJRIDPXOWLWXGHRIDQLPDODQGSODQW

ϯϱϬ

VSHFLHV DQG FKDUDFWHUL]HG E\ D PDUNHG WHFKQRORJLFDO SRODUL]DWLRQ ,Q GHYHORSLQJ FRXQWULHV
ZKLFK DFFRXQW IRU  DQG  RI WRWDO DQG ILQILVK JOREDO DTXDFXOWXUH SURGXFWLRQ
UHVSHFWLYHO\  WUDGLWLRQDO ORZ FRVW ORZVWRFNLQJ GHQVLW\ VXEVLVWHQFHRULHQWHG SRO\FXOWXUH
WHFKQRORJLHV DUH PDLQO\ XVHG ZKHUHDV LQ GHYHORSHG FRXQWULHV KLJKFRVW KLJKVWRFNLQJ
GHQVLW\SURILWRULHQWHGPRQRFXOWXUHWHFKQRORJLHVSUHYDLO

$OWKRXJK ERWK IDUPLQJ V\VWHPV DUH DW SUHVHQW HFRQRPLFDOO\ YLDEOH LQ WKHLU UHVSHFWLYH
DUHDVLQFUHDVLQJFRPSHWLWLRQIRUODQGDQGZDWHUDVZHOODVEURDGHQLQJRILQWHUQDWLRQDOIRRG
ILVK WUDGLQJ DUH SURPRWLQJ D WUHQG WRZDUGV JUHDWHU LQWHQVLILFDWLRQ RI IDUPLQJ V\VWHPV LQ
GHYHORSLQJFRXQWULHV&RQYHUVHO\FRPPHUFLDOFRPSHWLWLRQIRUIHHGUHVRXUFHVHVSHFLDOO\ILVK
PHDODQGILVK RLODQG ULVLQJ SURWHVW DJDLQVW HQYLURQPHQWDO LPSDFWVE\DTXDIHHGXVDJHDQG
IDUP HIIOXHQWV DUH GHPDQGLQJ OHVV QHJDWLYH HQHUJ\ DQG QLWURJHQ EDODQFHV LQ QXWULHQW
FRQYHUVLRQ E\ FXOWXUHG VSHFLHV DQG EHWWHU HQYLURQPHQWDO FRPSDWLELOLW\ RI DTXD IDUPV LQ
GHYHORSHG FRXQWULHV 7KHVH WHQGHQFLHV DUH OLNHO\ WR UHGXFH VRPH RI WKH GLIIHUHQFHV LQ
WHFKQRORJLFDO DSSURDFKHV DQG PDQDJHPHQW VWUDWHJLHV EHWZHHQ GHYHORSLQJ DQG GHYHORSHG
FRXQWULHV

$JUHDWHU WHFKQRORJLFDO KRPRJHQHLW\ LQ WKH DTXDFXOWXUH LQGXVWU\ LV OLNHO\ WRIDFLOLWDWH
WHFKQRORJ\WUDQVIHUVIDUPHU WUDLQLQJ DQG FRQYHUJHQFHRIDFWLRQWRZDUGVWKHPDLQREVWDFOHV
WKDWVWLOOOLHDORQJWKHSDWKRIDQDQQRXQFHGSURGLJLRXVJURZWK7KHPRVWFUXFLDORQHVDUHWKH
LQFLGHQFH RI GLVHDVH RXWEUHDNV WKH HIIHFWV RI PDUNHW SULFH IOXFWXDWLRQV RU GHFOLQH RQ
HQWHUSULVH RSHUDWLYHQHVV DQG RSSRVLWLRQ E\ RSLQLRQ JURXSV DQG OREELHV WKDW DUH ULJKWO\
FRQFHUQHGDERXWHQYLURQPHQWDOSURWHFWLRQFRQVHUYDWLRQRIELRGLYHUVLW\DQGDQLPDOZHOIDUH
,W LV JHQHUDOO\ UHFRJQL]HG WKDW UHVHDUFK LQWHQVLILFDWLRQ DQG WHFKQRORJLFDO GHYHORSPHQW FDQ
DSSURSULDWHO\DGGUHVVWKHVHSUREOHPV

)LVK&\WRJHQHWLFV

7HFKQLFDO$GYDQFHVLQ)LVK&\WRJHQHWLFV

7KH DGYDQFH RI ILVK F\WRJHQHWLF UHVHDUFK ZDV JUHDWO\ HQKDQFHG E\ WHFKQLFLDO
LQQRYDWLRQV LQ WKH SUHSDUDWLRQ RI PHWDSKDVH FKURPRVRPHV 7KH VPDOO VL]H RI ILVK
FKURPRVRPHV DQG WKHLU KLJK QXPEHU FRPSDUHG WR PDPPDOLDQ FKURPRVRPHV DQG WKH WKHQ
FXUUHQWVTXDVKRUFUXVKPHWKRGRISUHSDULQJFKURPRVRPHVZLWKGLUHFWIL[DWLRQRIWLVVXH
EORFNVLQDFHWLFDFLGRIWHQUHVXOWHGLQIHZKLJKTXDOLW\PHWDSKDVHVSUHDGVIRUDQDO\VLV
7KLVVTXDVKPHWKRGZLWKDFHWLFDFLGIL[DWLRQJHQHUDOO\DOVRUHVXOWHGLQLQMXU\WRWKHILQJHUV
7KHFKURPRVRPHSUHSDUDWLRQVSUHDGVIRUF\WRJHQHWLFVWXGLHVE\XVLQJFHOOVLQVXVSHQVLRQZDV
D PHWKRGRORJLFDO EUHDNWKURXJK $IWHU PRGLILFDWLRQV VXFK DV FROFKLFLQH WUHDWPHQW DQG
RSWLPL]DWLRQ LQ K\SRWRQL]DWLRQ WLPH IRU WURSLFDO PDULQH DQG IUHVKZDWHU ILVK VSHFLHV WKLV
PHWKRG EHFDPH FRPPRQ SUDFWLFH DQG LV VWLOO XVHG WRGD\ 7KH PRUH UHFHQW DSSOLFDWLRQ RI
SURFHGXUHV IRU PLWRWLF VWLPXODWLRQ DGDSWHG IRU ILVK UHVXOWHG LQ D VLJQLILFDQW LQFUHDVH LQ WKH
QXPEHURIDYDLODEOHPLWRWLFFHOOVIRUWKHSUHSDUDWLRQRIPHWDSKDVHFKURPRVRPHVSUHDGV7KLV
SDYHGWKHZD\IRUWKHFRQVROLGDWLRQRIWKHSURWRFROFXUUHQWO\XVHGZLWKJUHDWVXFFHVVLQPRVW
ODERUDWRULHV

7KH JURZWK RI WKH ILVK JHQHWLFLVWV¶ FRPPXQLW\ QRW RQO\ PXOWLSOLHG WKH FKDOOHQJHV IRU
LQWHJUDWLRQRIWKHILHOGEXWDOVRLQFUHDVHGWKHH[SHULPHQWDORSSRUWXQLWLHVDQGDSSURDFKHVWR
VROYH SUREOHPV LQ 1HRWURSLFDO ILVK JHQHWLFV ,Q WKH V ZLWK WKUHH PDLQ FHQWHUV IRU ILVK
F\WRJHQHWLFVZRUNRQHORFDWHGLQ%RWXFDWXDW6mR3DXOR 6WDWH 8QLYHUVLW\ 81(63  RQH LQ
6mR &DUORV DW WKH 6mR &DUORV )HGHUDO 8QLYHUVLW\ 8)6&DU  DQG RQH LQ 6mR 3DXOR DW WKH

ϯϱϭ

%LRVFLHQFHV,QVWLWXWHRIWKH8QLYHUVLW\RI6DR3DXOR ,%863 LQWHUHVW JUHZLQ 1HRWURSLFDO
ILVKF\WRJHQHWLFVDQGZHQWWKURXJKDSHULRGRIUDSLGH[SDQVLRQ

&\WRJHQHWLFV5HYHDOLQJ'LYHUVLW\LQ)LVK

7KH ILUVW SKDVH RI ZRUN RQ ILVK FKURPRVRPHV GHDOW PDLQO\ ZLWK JURVV FRPSDULVRQV
EHWZHHQVSHFLHV2ZLQJWRWKHWHFKQLTXHVDYDLODEOHPRVWSXEOLFDWLRQVGHVFULEHGNDU\RW\SHV
DQGPHUHO\FRQILUPHGWKHGLSORLGQXPEHURIFKURPRVRPHVLQDJLYHQILVKVSHFLHVEXWPLJKW
DOVR LQFOXGH *LHPVD VWDLQLQJ RI FKURPRVRPHV LGHQWLILFDWLRQRI KHWHURFKURPDWLQ &EDQGV 
WKHORFDOL]DWLRQRIQXFOHRODURUJDQL]LQJUHJLRQVDQGGHVFULSWLRQVRIDIHZPHLRWLFPHWDSKDVHV
$SRVLWLYHDVSHFWRIWKLVLQLWLDOSHULRGZDVWKHREVHUYDWLRQRIWKHJUHDWGLYHUVLW\LQNDU\RW\SHV
RI 1HRWURSLFDO ILVK VSHFLHV ZLWK QXPHULFDO DQG VWUXFWXUDO SRO\PRUSKLVP VXSHUQXPHUDU\
FKURPRVRPHVVH[FKURPRVRPHKHWHURPRUSKLVPV HWF7KHUHPDUNDEOHGLYHUVLW\UHYHDOHGLQ
ILVK E\ DSSOLFDWLRQ RI F\WRJHQHWLF WHFKQLTXHV DWWUDFWHG WKH DWWHQWLRQ RI WD[RQRPLVWV
0RUHRYHU GLIIHUHQFHV LQ GLSORLG QXPEHU DQG IRUPXODH VHHQ LQ ILVK NDU\RW\SHV UDLVHG
LQWULJXLQJTXHVWLRQV'RLQGLYLGXDOVRIVLPLODUPRUSKRORJ\EXWZLWK GLIIHUHQW FKURPRVRPDO
QXPEHUV FDSWXUHG LQ GLVWDQW K\GURJUDSKLF EDVLQV EHORQJ WR WKH VDPH VSHFLHV" &RXOG HDFK
F\WRW\SHUHSUHVHQWDGLIIHUHQWVSHFLHV"

7KHPHWKRGRORJ\XVHGLQILVKF\WRJHQHWLFVWXGLHVSDVVHGWKURXJKPDQ\PRGLILFDWLRQV
EURDGHQLQJ DQG GLYHUVLI\LQJ WKH ILHOG RI VWXG\ $V D FRQVHTXHQFH WKH ILHOG RI ILVK
F\WRJHQHWLFV ZKLFK KDG SUHYLRXVO\ EHHQ RQO\ GHVFULSWLYH DQG FRQILUPDWRU\ RI NDU\RW\SLF
GDWDQRZEHJDQWRLQYHVWLJDWHWKHVWUXFWXUHDQGFRPSRVLWLRQRIFKURPRVRPHVLQGHWDLO7KLV
ZDV DFKLHYHG E\ WKH XVH RI EDVHVSHFLILF IOXRURFKURPHV EDVH DQDORJXHV DQG UHVWULFWLRQ
HQ]\PHV ZKLFK SHUPLWWHG WKH LGHQWLILFDWLRQ DQG ORFDOL]DWLRQ RI VSHFLILF FKURPRVRPDO
VHJPHQWVDQGJHQHV0RUHUHFHQWO\WKHDSSOLFDWLRQRIIOXRUHVFHQWLQVLWXK\EULGL]DWLRQ ),6+ 
RIFORQHG'1$SUREHVWRLQWHUSKDVHDQGPHWDSKDVHFKURPRVRPHVSUHDGVZDVDQRWKHUPDMRU
VWHSWKDWVSXUUHGILVKF\WRJHQHWLFVUHVHDUFKEH\RQGWKHGHVFULSWLYHSKDVHRINDU\RW\SHV7KH
IXVLRQ RI VWUXFWXUDO DQG PROHFXODU F\WRJHQHWLFV RIIHUV JUHDW SRWHQWLDO IRU XQGHUVWDQGLQJ WKH
VWUXFWXUHDQGFRPSRVLWLRQRIILVKJHQHWLFPDWHULDODQGEHFDXVHWKHVHLQYHVWLJDWLRQVDUHVWLOOLQ
WKHLULQIDQF\WKHUHLVPXFKWREHH[SORUHG

$Q2XWORRN

,Q WKH VHDUFK IRU QHZ DUHDV DQG PHWKRGV LW LV ZRUWK PHQWLRQLQJ D IHZ WKDW PLJKW
EHFRPHWKHPRVWSURPLVLQJ7KHVHLQFOXGHDEHWWHUH[SORLWDWLRQRIWKHJUHDWGLYHUVLW\RIILVK
VSHFLHV WKH FKDUDFWHUL]DWLRQ RI QHZ VSHFLHV RI LQWHUHVW IRU ILVK FXOWXUH WKH SURGXFWLRQ RI
SRO\SORLGDQGJ\QRJHQHWLFILVKWKHLQGXFWLRQRIPRQRVH[LQGLYLGXDOVE\KRUPRQHWUHDWPHQW
DQG WKH GHYHORSPHQW RI WUDQVJHQLF ILVK :KLOH WKHVH QHZ WHFKQRORJLHV RIIHU QRYHO DQG
LQWULJXLQJ SRVVLELOLWLHV IRU IXUWKHU UHVHDUFK DQG GHYHORSPHQW RI DTXDFXOWXUH VWRFNV WKHLU
ZLGHVSUHDG DSSOLFDWLRQ LQ ILVK JHQHWLFV SURJUDPV VWLOO IDFHV GLYHUVH LPSHGLPHQWV LQFOXGLQJ
VRPHRIOHJDOSKLORVRSKLFDOUHOLJLRXVDQGHWKLFDOQDWXUH

:LWKWKHGHYHORSPHQWRIWHFKQLTXHVIRUKLJKTXDOLW\FKURPRVRPHSUHSDUDWLRQVDQGWKH
UHFHQW DSSOLFDWLRQ RI IOXRUHVFHQW LQ VLWX K\EULGL]DWLRQV WKH PDLQ IRFXV LQ ILVK F\WRJHQHWLFV
WXUQVWRGHILQLQJFKURPRVRPHVWUXFWXUHDQGJHQRPLFPDSSLQJRIILVK:LWKWKHLQWHJUDWLRQRI
PROHFXODUJHQHWLFVDQGVWUXFWXUDOF\WRJHQHWLFVPDQ\SURGXFWLYHDYHQXHVRIILVKF\WRJHQHWLF
UHVHDUFKDUHZDLWLQJWREHIXOO\H[SORUHGWKDWLQFOXGHXQGHUVWDQGLQJRIFKURPRVRPHVWUXFWXUH
DQGHYROXWLRQFKURPRVRPHSRO\PRUSKLVPVOLQNHGRUQRWWRVH[GHWHUPLQDWLRQWKHVWUXFWXUH

ϯϱϮ

DQG JHQHWLF IXQFWLRQLQJ RI VH[ FKURPRVRPHV DQG VXSHUQXPHUDU\ FKURPRVRPHV WKH ODWWHU
IHDWXUHFRPPRQO\REVHUYHGLQILVKNDU\RW\SHV

:LWK WKH DSSOLFDWLRQ RI PRGHUQ PROHFXODU JHQHWLFV WHFKQLTXHV DGYDQFHV LQ RXU
NQRZOHGJH DQG FRQVHUYDWLRQ RI WKH ELRGLYHUVLW\ RI ILVK E\ WKH FROODERUDWLRQ EHWZHHQ
F\WRJHQHWLFLVWVDQGWD[RQRPLVWVFDQEHDOVRDQWLFLSDWHG0XOWLSOHDQGPXOWLYDULDWHDQDO\VLVRI
PROHFXODUJHQHWLFPDUNHUVWXGLHVDQGPRUSKRORJLFDOGDWD ZLOODOORZ IRUQHZ LQWHUSUHWDWLRQV
RISK\ORJHQHWLFSURFHVVHV7KLVPD\ZHOOOHDGWRDEHWWHURUPRUHFRPSOHWHXQGHUVWDQGLQJRI
WKHSURFHVVHVRIVSHFLDWLRQLQILVKHV

,W LV DOVR LPSRUWDQW WR UHIOHFW RQ WKH FRQWULEXWLRQV PDGH E\ LFWK\RF\WRJHQHWLFLVWV RYHU
WKH \HDUV QRW RQO\ LQ WHUPV RI VFLHQWLILF DQG WHFKQRORJLFDO DGYDQFHV EXW DOVR IRU WKH
HQKDQFHPHQWRIWKHTXDOLW\RIOLIH:KHQRQHFRQVLGHUVWKHYDVWIDXQDOGLYHUVLW\DQGJHQHWLF
YDULDELOLW\LQILVKEDVLFJHQHWLFUHVHDUFKKDVEURDGHQHGLQDGHFLVLYHZD\RXUNQRZOHGJHRI
ILVK VSHFLHV DQG SRSXODWLRQV 7KLV NQRZOHGJH ZLOO OHDG LQ WKH VKRUW WR PHGLXP WHUP WR WKH
FKDUDFWHUL]DWLRQ RI HVVHQWLDO JHQHWLF EDQNV DQG WKH HVWDEOLVKPHQW RI QHFHVVDU\ PDQDJHPHQW
DQGFRQVHUYDWLRQSURJUDPVIRUWKLVIDXQD

,QWKHILHOGRIDTXDFXOWXUHWKHDSSOLFDWLRQRIQHZWHFKQRORJLHVDORQJZLWKDSSURSULDWH
PDQDJHPHQWVWUDWHJLHVKDVWKHSRWHQWLDOWRVLJQLILFDQWO\LQFUHDVHIRRGSURGXFWLRQ$OUHDG\ZH
DUHVHHLQJDTXDQWLWDWLYHLQFUHDVHLQWKHSURGXFWLRQRIFXOWXUHGILVKXVLQJWUDGLWLRQDOVHOHFWLRQ
PHWKRGV IRU UHGXFLQJ FXOWXUH WLPH HJ SDFX  DQG WKH SURGXFWLRQ RI K\EULGV VWHULOH DQG
PRQRVH[ VWUDLQV HJ WLOiSLDV  7KH DSSOLFDWLRQ RI FODVVLF EUHHGLQJ VHOHFWLRQ DQG
K\EULGL]DWLRQ PHWKRGV IRU EORRGVWRFN LPSURYHPHQW VWLOO SOD\VD FHQWUDO UROH LQ WKH JURZLQJ
DTXDFXOWXUH LQGXVWU\ EXW QRYHO JHQHWLF WRROV ZLOO VRRQ FRPSOHPHQW WKHVH DSSURDFKHV )RU
H[DPSOH FKURPRVRPH DQG PROHFXODU PDUNHUV KDYH EHHQ GHYHORSHG DQG XVHG IRU WKH
LGHQWLILFDWLRQ RI ZLOG DQG FXOWXUHG ILVK VWRFNV DQG LW LV QRZ SRVVLEOH WR HQVXUH WKH
PDLQWHQDQFHRIJHQHWLFYDULDELOLW\LQFXOWXUHGVWRFNVXVLQJWKHVHJHQHWLFWRROV)LQDOO\ZLWK
WKH PDQLSXODWLRQ RI ILVK FKURPRVRPHV DQG SHUKDSV WUDQVJHQLFV UHVHDUFK FRQGXFWHG LQ
ODERUDWRULHV DQG H[SDQGHG WR ILVK IDUPV ZLOO EHFRPH DQ HYHU PRUH LPSRUWDQW WRRO LQ WKH
SURGXFWLRQDQGXVHRIWKLVRIDQLPDOSURWHLQVRXUFHDVIRRG


$TXDWLFELRWHFKQRORJ\

7KH UHDOL]DWLRQ RI WKH UROH RI DTXDWLF ELRWHFKQRORJ\ PHDQV WKDW DTXDFXOWXUH LQ WKH
FRPLQJ GHFDGHV VKRXOG XQGHUJR D UDGLFDO WUDQVIRUPDWLRQ GULYHQ E\ ERWK HQJLQHHULQJ
LQQRYDWLRQV HJ RIIVKRUH VXEPHUVLEOH FDJHV IRU PDULFXOWXUH PRQLWRUHG E\ UHPRWHO\
RSHUDWHG FDPHUDHTXLSSHG XQGHUZDWHU YHKLFOHV LQODQG ZDWHUUHFLUFXODWLQJ V\VWHPV IRU ILVK
IDWWHQLQJ FRXSOHGWRHQHUJHWLFDOO\FRPSOHPHQWDU\FXOWXUHVVXFKDVK\GURSRQLFVPDFURDOJDH
RU VSRQJH FXOWLYDWLRQV RQOLQH SURFHVV DXWRPDWLRQ HWF  DQG ELRHQJLQHHULQJ RI DTXDWLF
RUJDQLVPV ,Q WKLV VFHQDULR WKH DTXDFXOWXUDO SURGXFWV RI WKH IXWXUH ZLOO EH UDLVHG ZLWK
LQQRYDWLYHPHWKRGVDQGZLOODSSHDUVRPHKRZGLIIHUHQWIURPWKHSURGXFWVRIIHUHGWRGD\WRWKH
FRQVXPHUV3UREDEO\WKLVYLVLRQPD\DSSHDUFRQWURYHUVLDOLIQRWKD]DUGRXVQRWRQO\WRWKRVH
WKDW IHHO RSSUHVVHG E\ WHFKQRORJLFDO SURJUHVV DQG YLVFHUDOO\ RSSRVH ELRWHFKQRORJ\0DVV
PHGLDRIWHQGHSLFWELRWHFKQRORJ\ZLWKDVFDULQJSURILOHRUDWWULEXWHVXQUHDOLVWLFSRZHUVWRLW
VRWKDWLWLVPRVWO\SHUFHLYHGDVDQXQQHFHVVDULO\PDQLSXODWLYHDQGLQWUXVLYHRSWLRQ

$FWXDOO\WKHGHYHORSPHQWRIELRWHFKQRORJLFDODTXDFXOWXUHLVQRWDSRVWSRQDEOHRSWLRQ
EXWUDWKHUDQLQGLVSHQVDEOHFRXUVHWREHWDNHQLIWKHSURMHFWHGIHDWV RI DTXDFXOWXUH PXVW EH

ϯϱϯ

VRPHWKLQJPRUHWKDQZLVKIXOWKLQNLQJ7KHREMHFWLRQWKDWWKHLQFRUSRUDWLRQRIELRWHFKQRORJ\
LQWRDTXDFXOWXUHLVOLNHO\WRH[DFHUEDWHRSSRVLWLRQE\WKHDQWLDTXDFXOWXUHOREE\DQGIXUWKHU
FRQIXVH WKH OD\PDQ V RSLQLRQ FDQ LQGHHG LV UHYHUVHG LI RQH FRQVLGHUV WKDW ELRWHFKQRORJ\
SUHOLPLQDULO\ UHTXLUHV D VWULQJHQW YDOLGDWLRQ RI LWV WHFKQLFDO DSSURDFKHV LQ WHUPV RI
HQYLURQPHQWDOVDIHW\DQGELRORJLFDOKDUPOHVVQHVV7KXVLWPD\DFWXDOO\SURYLGHVROXWLRQVWR
VWLOORSHQSUREOHPVDERXWHFRV\VWHPLFLPSDFWVE\DTXDFXOWXUH)RULQVWDQFHWKHHQIRUFHPHQW
RI JRQDGDO VWHULOLW\ LQ JHQHWLFDOO\ PDQLSXODWHG ILVK WR VHJUHJDWH WKHP UHSURGXFWLYHO\ IURP
ZLOG FRQVSHFLILFV FRXOG EH DGRSWHG DV D JHQHUDO PHDVXUH WR DYRLG DQ\ JHQHWLF PHGGOLQJ
EHWZHHQ IDUPHG HVFDSHHV DQG ZLOG ILVK 7KH VHDUFK IRU YLDEOH DOWHUQDWLYHV WR RIIVHW PDUNHW
VDWXUDWLRQRWKHUWKDQWKHUHFRXUVHWRQHZVSHFLHVIRUFXOWLYDWLRQPD\DOVREHSXUVXHGWKURXJK
K\EULGL]DWLRQVSHUPFU\RSUHVHUYDWLRQDQGFKURPRVRPHVHWPDQLSXODWLRQ0ROHFXODUELRORJ\
WHFKQLTXHV SURYLGH IDVWHU DQG FKHDSHU GLDJQRVWLF DVVD\V IRU DTXDWLF SDWKRJHQV DQG
UHFRPELQDQW '1$ WHFKQRORJ\ PD\ EH DGRSWHG WR FRQIHU LPPXQRFRPSHWHQFH DQG LV HDVH
UHVLVWDQFH UHFRPELQDQWYDFFLQHV DQWLVHQVH WUDQVJHQHV '1$ LPPXQL]DWLRQ HWF ,QFOXVLRQ
RIHWKLFDOLVVXHVLQWRWKHJXLGHOLQHVIRUVXVWDLQDEOHDTXDFXOWXUHLVDVHQVLEOHVWHSWRGHIXVHWKH
PRXQWLQJLPSDWLHQFHDJDLQVWWKHSRVVLEOHDGYHUVHFRQVHTXHQFHVRIDTXDFXOWXUHH[SDQVLRQ$V
WRWKHWHFKQRORJLFDOXSJUDGLQJWRUHGXFHVHQVLWLYHLQWHUIDFHVDQGLQFUHDVHHIILFLHQF\WKHEHVW
VWUDWHJ\ LV WR DFFHOHUDWH SURJUHVV DORQJ PXOWLSOH OLQHV 7KHVH VKRXOG LQFOXGH EHWWHU IDUP
GHVLJQDQGPDQDJHPHQWZLWKDSSURSULDWHPHDVXUHVIRUGLVHDVHSUHYHQWLRQDQGFRQWDLQPHQW
WKH JHQHWLF LPSURYHPHQW RI EURRGVWRFN DFFRUGLQJ WR WKH SULQFLSOHV RI TXDQWLWDWLYH JHQHWLFV
VHOHFWLYHEUHHGLQJDQGFURVVEUHHGLQJRILQEUHGOLQHV DVZHOODVSURGXFWLYHLPSURYHPHQWVE\
FKURPRVRPHDQGJHQHWLFHQJLQHHULQJ7KHUHLVRQO\DVKRUWODSVHRIWLPHDKHDGRIXVWRVROYH
WKHSUHVHQWHPHUJHQFLHVDQGHQGRZWKHDTXDFXOWXUHVHFWRUZLWKWKHPHDQVDQGWHFKQRORJLHVWR
DWWDLQ LWV JRDOV $OO RSSRUWXQLWLHV PXVW EH H[SORUHG DQG FRPSDUHG ZLWKRXW SUHFRQFHSWXDO
H[FOXVLRQV ,Q WKLV SDSHU DQ HIIRUW LV PDGH WR RXWOLQH WKH PDLQ DGYDQWDJHV DQG SUREOHPV
DVVRFLDWHG ZLWK WKH DSSOLFDWLRQ RI WKH WHFKQLTXHV RI FKURPRVRPH VHW PDQLSXODWLRQ VH[
FRQWUROLQWHUJHQHULFK\EULGL]DWLRQDQGJHQHWUDQVIHULQILVKFXOWXUHZLWKSDUWLFXODUUHIHUHQFH
WRFXOWXUHG0HGLWHUUDQHDQPDULQHWHOHRVWILVK7KHFRPSOHPHQWDULW\DQGLQWHJUDELOLW\RIWKHVH
WHFKQLTXHVZLOOEHEULHIO\GLVFXVVHG

&KURPRVRPHVHWPDQLSXODWLRQ

,Q ILVK FXOWXUH WKH WHFKQLTXHV RI FKURPRVRPH VHW PDQLSXODWLRQ FDQ EH XVHG IRU WZR
GLIIHUHQW SXUSRVHV HLWKHU WR LQGXFH SRO\SORLG\ HVVHQWLDOO\ WR REWDLQ WULSORLG DQG WHWUDSORLG
ILVKRUWRUHSURGXFHILVKE\XQLSDUHQWDOFKURPRVRPHLQKHULWDQFHWRREWDLQJ\QRJHQHWLFDQG
DQGURJHQHWLFILVK7KHPDLQDVSHFWVRIWKLVFKURPRVRPHHQJLQHHULQJKDYHEHHQUHYLHZHG
7ZR SRLQWV DUH ZRUWK FRQVLGHULQJ ILUVWO\ FKDQJHV IURP GtSORLG\ WR SRO\SORLG\ DQG
XQLSDUHQWDO UHSURGXFWLRQ PD\ RFFXU QDWXUDOO\ LQ WHOHRVWV )RU LQVWDQFH VDOPRQLGV KDYH
DSSDUHQWO\XQGHUJRQHDWHWUDSORLGL]DWLRQHYHQWWRWKHLUDQFHVWU\DQGVSRQWDQHRXVWULSORLGVDQG
WHWUDSORLGVDUHVRPHWLPHVIRXQGZLWKLQGLSORLGILVKSRSXODWLRQV$URXQGRUWZRRIWHWUDSORLG
HYROXWLRQ LV VXUPLVHG HYHQ tQ WKH SLVFLQH DQFHVWRUV RI PDPPDOV *\QRJHQHVLV LV WKH VROH
PRGH RI UHSURGXFWLRQ RI VRPH SRSXODWLRQV RI WKH FUXFLDQ FDUS &DUDVVLXV DXUDWXV JLEHOLR 
DQGVHYHUDOVSHFLHVRIWKHIDPLO\3RHFLOLGDHZKLOHVSRQWDQHRXVJ\QRJHQHVLVRUDQGURJHQHVLV
LV VRPHWLPHV REVHUYHG LQ FURVVHV RI GLIIHUHQW ILVK VSHFLHV 6HFRQGO\ WKH WHFKQLTXHV RI
FKURPRVRPHVHWPDQLSXODWLRQFDQEHXVHIXOO\DSSOLHGWRFRPSOHPHQWRWKHUWHFKQLTXHVVXFK
DV LQWHUVSHFLILF K\EULGL]DWLRQ DUWLILFLDO VSHFLDWLRQ JHQHWLF HQJLQHHULQJ VH[ FRQWURO
SRSXODWLRQ FRQWURO VHOHFWLYH EUHHGLQJ SXUH OLQH RU FORQH FURVVEUHHGLQJ DQG VSHUP
FU\RSUHVHUYDWLRQ
,QGXFWLRQRISRO\SORLG\


ϯϱϰ

 7KH PDLQ SURFHGXUHV IRU WKH LQGXFWLRQ RI SRO\SORLG\ LQ ILVK FRQVLVW LQ HLWKHU WKH
EORFNDJH RI WKH UHVXPSWLRQ RI WKH VHFRQG PHLRWLF GLYLVLRQ LQ WKH IHUWLOL]HG RRF\WH ZLWK
FRQVHTXHQW UHWHQWLRQ RI WKH VHFRQG SRODU ERG\ PHLRWLF EORFN  RU WKH VXSSUHVVLRQ RI WKH
PLWRWLFGLYLVLRQDWWKHILUVWHPEU\RQLFFOHDYDJHZLWKFRQVHTXHQWIXVLRQRIWKHWZREODVWRPHUH
JHQRPHV PLWRWLF EORFN  %HFDXVH DW V\QJDP\ GXULQJ QRUPDO IHUWLOL]DWLRQ D GLSORLG
VHFRQGDU\ RRF\WH LV IXVHG ZLWK D KDSORLG VSHUPDWR]RRQ WKH UHWHQWLRQ RI WKH KDSORLG
FKURPRVRPH VHW RI WKH VHFRQG SRODU ERG\ LQGXFHG E\ WKH PHLRWLF EORFN ZLOO UHVXOW DW
NDU\RJDP\LQ D WULSORLG FKURPRVRPHFRPSOHPHQW &RQYHUVHO\WKHGRXEOLQJ RIWKHGLSORLG
FKURPRVRPH VHRWI WKH ]\JRWH FDXVHG E\ WKH PLWRWLFEORFNZLOOUHVXOW LQDWHWUDSORLGVWDWXV
6HYHUDOPHWKRGVFDQEHXWLOL]HGWRLQGXFHPHLRWLFRUPLWRWLFEORFNVVXFKDVDWKHUPDOVKRFN
KHDWVKRFNDWDVXEOHWKDOWHPSHUDWXUHRUFROGVKRFNDW& DK\GURVWDWLFSUHVVXUHVKRFN
HOHFWURIXVLRQ HOHFWULF ILHOGLQGXFHG FHOO IXVLRQ  RU H[SRVXUH WR FKHPLFDO IXVRJHQV HJ
QLWURXVR[LGHF\WRFKDODVLQ%SRO\HWK\OHQHJO\FRO $OOWKHVHWUHDWPHQWVPXVWEHDSSOLHGMXVW
EHIRUHWKHSUHVXPSWLYHWLPHRIPHLRWLFUHVXPSWLRQRUPLWRWLFGLYLVLRQ7KHUPDODQGSUHVVXUH
VKRFNV DUH XVXDOO\ SUHIHUUHG WR WKH RWKHU PHWKRGV EHFDXVH WKH\ DUH SRWHQWLDOO\ OHVV
WUDXPDRWULF WR[LF 3ORLG\ OHYHOV FDQ EH DVVHVVHG E\ D YDULHW\ RI WHFKQLTXHV LQFOXGLQJ
PHDVXUHPHQW RI HU\WKURF\WH QXFOHDU RU FHOOXODU YROXPHV QXFOHRODU FRXQWLQJ FKURPRVRPH
FRXQWLQJDQG'1$FRQWHQWGHWHUPLQDWLRQE\IORZF\WRPHWU\

7ULSORLG\

,QWHUHVWLQWULSORLGILVKDULVHVIURPWKHIDFWWKDWWKH\DUHPRVWO\VWHULOHRZLQJWRHLWKHUD
ODFN RI JRQDGDO GHYHORSPHQW EH\RQG D UXGLPHQWDU\ GLIIHUHQWLDWLRQ VWDJH ZLWK FRQVHTXHQW
JDPHWRJHQHWLF IDLOXUH JRQDGDO VWHULOLW\  RU ODFN RI JDPHWH IHUWLOLW\ GXH WR PHLRWLF
DEQRUPDOLWLHVFDXVHGE\WKHRGGQXPEHURIFKURPRVRPHVHWV JDPHWLFVWHULOLW\ 7KHVHYHULW\
RIJRQDGDOGHYHORSPHQWLQKLELWLRQ YDULHV ZLWK VSHFLHVDQGVH[*HQHUDOO\WULSORLG\LQKLELWV
PRUH RYDULDQ WKDQ WHVWLFXODU GHYHORSPHQW EHFDXVH LW GRHV QRW LQWHUIHUH ZLWK WKH PXOWLSOH
ZDYHVRIVSHUPDWRJRQLDOPLWRWLFGLYLVLRQV0RUHRYHUVHFRQGDU\VH[XDOFKDUDFWHUVDQGVH[XDO
EHKDYLRXUDUHQRWDOZD\VVXSSUHVVHGLQPDOHV

7KHUHDUHDQXPEHURISRVVLEOHEHQHILWVDVVRFLDWHGZLWKJRQDGDOVWHULOLW\VXFKDV
L ,QUHODWLRQWRJURZWKDQGVXUYLYDO D IDVWHUJURZWKUDWHRIWULSORLGVDIWHUWKHQRUPDO
WLPH RI SXEHUW\ RI GLSORLGV DV WKH IRUPHU GR QRW VKXQW HQHUJ\ IURP VRPDWLF JURZWK LQWR
JRQDGDO PDWXUDWLRQ E  LQFUHDVHG ORQJHYLW\ DQG JURZWK WR WURSK\ VL]H LQ UHOHDVHG ILVK WKDW
QRUPDOO\H[SHULHQFHKLJKPRUWDOLW\DWWKHWLPHRIVSDZQLQJOLNHPDQ\VDOPRQLGV F ODFNRI
WKH GHFUHPHQW LQ WKH EDFWHULFLGDO DFWLYLW\ RI VHUXP REVHUYHG LQ GLSORLGILVK GXULQJ JRQDGDO
PDWXUDWLRQ DQG VSDZQLQJ DQG G  LQWHQVLILFDWLRQ RI IOHVK FRORXU LQ VDOPRQLGV IHG
FDQWKD[DQWKLQDWWKHHQGRIWKHIDWWHQLQJVWDJHZKHQWKLVVWHSLVSHUIRUPHGGXULQJWKHQRUPDO
EUHHGLQJVHDVRQ
LL  ,Q UHODWLRQ WR SRSXODWLRQ FRQWURO D  SRSXODWLRQ FRQWURLQO FDVH RI SUROLILF VSHFLHV
ZKLFK WHQG WR RYHUSRSXODWH FRQILQHG ZDWHU ERGLHV DQG E  SRSXODWLRQ FRQWURO LQ FDVH RI
LQWURGXFHGDOORFKWKRQRXVVSHFLHV
LLL  ,Q UHODWLRQ WR K\EULGL]DWLRQ D  HQKDQFHG VXUYLYDO RI FHUWDLQ LQWHUVSHFLILF DQG
LQWHUJHQHULFK\EULGV ZKHQHYHUJHQRPH LQFRPSDWLELOLW\ LVPLWLJDWHGE\WKHGRXEOHPDWHUQDO
JHQHGRVH E SUHYHQWLRQRILQWURJUHVVLYHK\EULGL]DWLRQZKHQDUHVWRFNHGYDULHW\RUVSHFLHV
FDQLQWHUEUHHGZLWKDWKUHDWHQHGV\PSDWULFYDULHW\RUVSHFLHV F DYRLGDQFHRIEDFNFURVVLQJ
EHWZHHQSDUWLDOO\IHUWLOHLQWHUVSHFLILFK\EULGVDQGWKHLUSDUHQWDOVSHFLHVDQG G UHSURGXFWLYH
VHJUHJDWLRQRIIHUWLOHLQWHUVSHFLILFK\EULGV
LY ,QUHODWLRQWRWUDQVJHQHVLVUHSURGXFWLYHVHJUHJDWLRQRIJHQHWLFDOO\HQJLQHHUHGILVK
IURPZLOGFRQVSHFLILFV

ϯϱϱ

 
7KH PDLQ GUDZEDFNV LQ WKH H[SORLWDWLRQ RI LQGXFHGWULSORLG\ DUH L  GLIILFXOW\ LQ
REWDLQLQJWULSORLGILVKE\PHLRWLFEORFNGXHWRUHMHFWLRQRIWKHVSHUPJHQRPHRUIDLOXUH
RIVHFRQGSRODUERG\UHWHQWLRQ LL ORZHUSUHSXEHUWDOJURZWKUDWHRIWULSORLGVLQVRPHVSHFLHV
HVSHFLDOO\ZKHQWULSORLGVDUHFXOWXUHGFRPPXQDOO\ ZLWKGLSORLGVDQG LLL ORZHUUHVSLUDWRU\
FDSDFLW\RIWULSORLGVGXHWRDOHVVIDYRXUDEOHVXUIDFHWRYROXPHUDWLRLQUHGEORRGFHOOVDQGDW
OHDVW LQ UDLQERZ WURXW 2QFRUK\QFKXV P\NLVV D ORZHU EORRG KDHPRJORELQ FRQFHQWUDWLRQ
OHDGLQJ WR PDFURF\WLF DQDHPLD DQG GLPLVKHG VXUYLYDO DQG JURZWK DW FKURQLF KLJK
WHPSHUDWXUHV

7HWUDSORLG\

7HWUDSORLG\ KDV EHHQ OHVV LQWHQVLYHO\ LQYHVWLJDWHG WKDQ WULSORLG\ DQG LWV SRWHQWLDO
DGYDQWDJHVDUHVWLOOWREHIXOO\ H[SORUHG1HZO\DULVHQWHWUDSORLGVDUHRIWHQ OHVVYLDEOH WKDQ
GLSORLGVDQGWULSORLGVDQGIHUWLOLW\PD\EHUHGXFHGLQDXWRWHWUDSORLGVEHFDXVHRIXQEDODQFHG
GLVMXQFWLRQ RI FKURPRVRPHV DIWHU PHLRWLF PXOWLYDOHQW SDLULQJ 7KHRUHWLFDOO\ LQGXFHG
WHWUDSORLGILVKPD\EHH[SORLWHG
L ,QUHODWLRQWRJHQHWLFVWRSURGXFHVXSHUKHWHUR]\JRXVILVKZLWKXSWRIRXUGLIIHUHQW
DOOHOHVSHUORFXVDQGLQFUHDVHGHQ]\PHPXOWLSOLFLW\
LL  ,Q UHODWLRQ WR WZRVWHS FKURPRVRPH VHW PDQLSXODWLRQ D  WR JHQHUDWH DXWRWULSORLG
SURJHQLHV ZLWK D ORZHU OHYHO RI KRPR]\JRVLW\ ZKHQ WHWUDSORLG ILVK DUH FURVVHG ZLWK
LVRVSHFLILFGLSORLGVDQG E WRREWDLQDQGURJHQRWHVE\IHUWLOL]LQJJHQHWLFDOO\LQDFWLYDWHGHJJV
ZLWKGLSORLGVSHUPIURPDXWRWHWUDSORLGPDOHV
LLL  ,Q UHODWLRQ WR K\EULGL]DWLRQ D  WR FUHDWH QHZ WHWUDSORLG K\EULG VSHFLHV E\
SRO\SORLGL]DWLRQRILQWHUVSHFLILFK\EULGVLQWRIHUWLOHDOORWHWUDSORLGV DUWLILFLDOVSHFLDWLRQ  E 
WR SURGXFH VWHULOH DOORWULSORLGV ZKHQ DQ DXWRWHWUDSORLG LV FURVVHG ZLWK D GLSORLG PDWH RI D
GLIIHUHQW JHQHWLFDOO\ FRPSDWLEOH VSHFLHV RU DOWHUQDWLYHO\ ZKHQ DQ DOORWHWUDSORLG LV FURVVHG
ZLWKDGLSORLGPDWHRIRQHRILWVRULJLQDOSDUHQWDOVSHFLHV F WRREWDLQVWHULOHWULSOHK\EULG
DOORWULSORLGVE\FURVVLQJDQDOORWHWUDSORLGZLWKDGLSORLGPDWHRIDVSHFLHVGLIIHUHQWIURPWKH
SDUHQWDOVSHFLHVRIWKHDOORWHWUDSORLG

$OWKRXJK SRO\SORLGL]DWLRQ LV UHFRJQL]HG DV D EDVLF PHFKDQLVP IRU IDVW VSHFLDWLRQ LQ
QDWXUHDQGDG\QDPLFIRUFHLQHYROXWLRQLWVKRXOGEHQRWHGWKDWEULQJLQJLQWRH[LVWHQFHDQHZ
K\EULGVSHFLHVE\LQGXFHGDOORWHWUDSORLG\HQWDLOVWKHULVNRIHFRV\VWHPLFLPSDFWVRQZLOGILVK
SRSXODWLRQV DQG RWKHU DTXDWLF RUJDQLVPV HVSHFLDOO\ ZKHQ WKH K\EULGV SRVVHVV JUHDW
LQYDVLYHQHVV DQG JRRG IHUWLOLW\ 5HJXODWLRQV DERXW WKHLU FRQWDLQPHQW PXVW WKHUHIRUH EH
DVVLPLODWHGWRWKRVHIRUHLWKHU DOORFKWKRQRXV VSHFLHV DVV\QWKHWLFVSHFLHV DUHIRUHLJQWRWKH
ORFDOIDXQD RUJHQHWLFDOO\PRGLILHGRUJDQLVPV DVWZRSK\ORJHQHWLFDOO\GLVWLQFWVHWVRIJHQHV
DUH UHFRPELQHG LQWR D QRYHO SHUSHWXDWLQJ JHUPOLQH  8QLSDUHQWDO FKURPRVRPH LQKHULWDQFH
)HUWLOL]DWLRQ XVLQJ HLWKHU HJJV RU VSHUP ZKRVH JHQHWLF PDWHULDO KDV EHHQ LQDFWLYDWHG E\
UDGLDWLRQ JLYHV ULVH WR KDSORLG J\QRJHQHWLF DQG DQGURJHQHWLF ILVK UHVSHFWLYHO\ ,RQL]LQJ
UDGLDWLRQ \UD\V DQG ;UD\V IURP FREDOW DQG UDGLXP VRXUFHV GRVH UDQJH  NUDG 
VKDWWHUV '1$ ZKHUHDV VKRUWZDYH XOWUDYLROHWOLJKW 89F ZDYHOHQJWK DERXW  QP GRVH
UDQJHNJPP GHVWUR\V'1$E\WK\PLQHGLPHUL]DWLRQ7KRXJKOHVV SHQHWUDWLQJ89F
OLJKW LV SUHIHUUHG WR LRQL]LQJ UDGLDWLRQ EHFDXVH L  LW GRHV QRW UHTXLUH KD]DUGRXV PDFKLQHU\
XQDYDLODEOH DW ILVK IDUPV LL  LW GRHV QRW OHDYH VXSHUQXPHUDU\ FKURPRVRPDO IUDJPHQWV
UHVLGXDO IURP WKH LUUDGLDWHG JDPHWH LQVLGH WKH ]\JRWH QXFOHXV ZKHUH WKH\ FDQ EH
WUDQVFULSWLRQDOO\ DFWLYH DQG UHSOLFDWHG GXULQJ HPEU\RJHQHVLV DQG LLL  LW UHVXOWV LQ EHWWHU
PRUSKRORJ\RIVXUYLYLQJKDSORLGHPEU\RVRUODUYDH,RQL]DWLRQUDGLDWLRQLVKRZHYHUQHHGHG
WRWUHDWRSDTXH\RON\RRF\WHVRUODUJHYROXPHRVIXQGLOXWHGPLOW

ϯϱϲ

 
,QWHOHRVWVKDSORLG\ LVXVXDOO\LQFRPSDWLEOHZLWK VXUYLYDO EH\RQG HPEU\RQLF RU HDUO\
ODUYDOVWDJHVWKRXJKDORZYLDELOLW\ZLWKKHDY\ DEQRUPDOLWLHVKDVEHHQREVHUYHGLQKDSORLG
WLODSLD 'LSORLGL]DWLRQ RI WKH PDWHUQDO FKURPRVRPH FRPSOHPHQW LQ J\QRJHQRWHV FDQ EH
FDUULHG RXW E\ HLWKHU PHLRWLF EORFN PHLRJ\QRJHQHVLV  RU PLWRWLF EORFN PLWRJ\QRJHQHVLV 
XVLQJ WKH VDPH WHFKQLTXHV DGRSWHG IRU SRO\SORLGL]DWLRQ $QGURJHQRWHV LQVWHDG FDQ EH
GLSORLGL]HG H[FOXVLYHO\ E\ PLWRWLF EORFN 7R FRQILUP XQLSDUHQWDO FKURPRVRPH LQKHULWDQFH
VSHFLDO FRQWURO PHDVXUHV FDQ EH WDNHQ LQ WKH VHOHFWLRQ RI WKH SDUHQW ZKRVH JDPHWHV DUH
JHQHWLFDOO\LQDFWLYDWHG7KLVPD\EHFKDUDFWHUL]HGE\DYLVLEOHGRPLQDQWWUDLWZKLFKLVDEVHQW
LQ WKH RWKHU PDWH DQG VKRZV XS LQ ELSDUHQWDO SURJHQ\ $OWHUQDWLYHO\ LW PD\ EHORQJ WR D
GLIIHUHQWVSHFLHVZKRVHK\EULGVDUHSKHQRW\SLFDOO\GLYHUJHQW RU XQYLDEOHLQ WKH GLSORLG DQG
WULSORLGFRQGLWLRQV

0HLRJ\QRJHQHVLV

0HLRJ\QRJHQRWHVDUHLQJHQHUDORQO\SDUWLDOO\KRPR]\JRXVWKHLUKHWHUR]\JRVLW\OHYHO
GHSHQGLQJXSRQWKHIUHTXHQF\RIJHQHUHFRPELQDWLRQVFDXVHGE\RGGQXPEHUVRIFURVVRYHUV
EHWZHHQ KRPRORJRXV FKURPDWLGV 'HVSLWH WKHLU ODFN RI FRPSOHWH KRPR]\JRVLW\
PHLRJ\QRJHQHWLF ILVK FDQ EH XWLOL]HG IRU D YDULHW\ RI SXUSRVHV VXFK DV L  ,Q UHODWLRQ WR
WULSORLG\ LQGXFWLRQ WR GHILQH WKH EHVW FRQGLWLRQV IRU WULSORLG\ LQGXFWLRQ DV LQGLFDWHG E\ WKH
EHVWVXUYLYDORIJ\QRJHQHWLFSURJHQ\DIWHUPHLRWLFEORFN LL ,QUHODWLRQWRVH[FRQWURO D WR
H[SORUHWKHJHQHWLFVH[GHWHUPLQDWLRQPHFKDQLVPDQGWKHLQIOXHQFHRIHQYLURQPHQWDOIDFWRUV
LIDQ\RQWKHILQDOVH[XDOSKHQRW\SH E WRSURGXFHGLUHFWO\ DOOIHPDOHSURJHQLHVLQVSHFLHV
ZLWK JHQHWLFDOO\ GHWHUPLQHG VH[ IHPDOH KRPRJDPHW\ DQG EHWWHU SHUIRUPDQFHLQ FXOWXUH RI
IHPDOHV WKDQ PDOHV F  WR RYHUFRPH WKH GLIILFXOW\ LQ WKH GLVFULPLQDWLRQ RI SVHXGRPDOHV
JHQHWLF IHPDOHV LQYHUWHG LQWR SKHQRW\SLF PDOHV  IURP JHQHWLF PDOHV ZKHQHYHU
PHLRJ\QRJHQRWHVDUHDOOIHPDOHVWKXV\LHOGLQJDIWHUVH[UHYHUVDODOOSVHXGRPDOHVWKHODWWHU
FDQEHFURVVHGWRQRUPDOIHPDOHVWRJHQHUDWHDOOIHPDOHSURJHQLHV PRQRVH[XDOL]DWLRQRIILVK
VWRFNV  LLL  ,Q UHODWLRQ WR JHQHWLFV D  WR GLVFKDUJH SDUW RI WKH JHQHWLF ORDG RI KDUPIXO
UHFHVVLYH DOOHOHV IURP D IRXQGHU EURRGVWRFN JHQH SRRO EHFDXVH RIIVSULQJ KRPR]\JRXV IRU
VXFK DOOHOHV ZRXOG EH SKHQRGHYLDQW DQG GHIHFWLYH DQG WKXV GLVFDUGHG E  WR IDFLOLWDWH
PDSSLQJ RI JHQHV UHODWLYHO\ WR WKHLU FHQWURPHUHV HVSHFLDOO\ LQ VSHFLHV ZLWK PDQ\
FKURPRVRPHV EHFDXVH WKH FORVHU D ORFXV WR LWV FHQWURPHUH WKH ORZHU WKH IUHTXHQF\ RI
KHWHUR]\JRWHVLQWKHPHLRJ\QRJHQHWLFSURJHQ\DQG F WRHVWLPDWHWKHGHJUHHRIFRQVHUYDWLRQ
RIJHQHDUUDQJHPHQWVDQGGLIIHUHQFHVLQJHQHUHFRPELQDWLRQUDWHVDPRQJUHODWHGVSHFLHV

0LWRJ\QRJHQHVLV

0LWRJ\QRJHQRWHV DUH FRPSOHWHO\ KRPR]\JRXV EHFDXVH WKHLU JHQRPH GHULYHV IURP D
PLWRWLFDOO\ GXSOLFDWHG KDSORLG FKURPRVRPH VHW 7KHLU YLDELOLW\ VH[ DQG IHUWLOLW\ KDYH EHHQ
H[SORUHG LQ H[SHULPHQWDO ILVK PRGHOV VXFK DV WKH ]HEUDILVK 'DQLR UHULR DQG WKH PHGDND
2U\]LDV ODWLSHV DV ZHOO DV LQ UDLQERZ WURXW 7KHLU SRWHQWLDO XVH LQ ILVK FXOWXUH KDV EHHQ
H[DPLQHG LQ WKH FRPPRQ FDUS &\SULQXV &DUSLR IORXQGHU 3DUDO\FKWK\V ROLYDFHRXV D\X
3OHFRJORVVXV DOWLYHOLV JLOWKHDG VHDEUHDP 6SDUXV DXUDWD DQG (XURSHDQ VHDEDVV
'LFHQWUDUFKXVODEUD[
6HYHUDOSRVVLEOHDSSOLFDWLRQVRIPLWRJ\QRJHQHVLVFDQEHHQYLVDJHGVXFKDV
L LQUHODWLRQWRJHQHWLFV D WRIUHHFRPSOHWHO\DEURRGVWRFNJHQHSRROIURPLWV
ORDGRIGHOHWHULRXVUHFHVVLYHDOOHOHVEHFDXVHDOORIWKHPZLOOEHPDQLIHVWHGLQWKHRIIVSULQJ
DQG WKXV FXOOHG E  WR DVVHVV SKHQRW\SLF YDULDWLRQ GXH WR HQYLURQPHQWDO IDFWRUV LQ WKH
HVWLPDWH RI JHQHWLF KHULWDELOLW\ K  IRU TXDQWLWDWLYH WUDLWV DV FORQDO ILVK KDYH QR JHQHWLF

ϯϱϳ

YDULDWLRQ DQG F  WR VWXG\ WKH LQIOXHQFH RI KRPR]\JRVLW\ RQ GHYHORSPHQWDO VWDELOLW\ DV
PHDVXUHGE\IOXFWXDWLQJELODWHUDODV\PPHWU\IRUPHULVWLFWUDLWV ILQUD\VJLOOUDNHUVRQWKHILUVW
EUDQFKLDODUFKHVPDQGLEXODUSRUHVHWF 
LL  ,Q UHODWLRQ WR FORQLQJ D  WR SURGXFH ILVK FORQHV ZKHQHYHU )
PLWRJ\QRJHQRWHV ZKLFK DUH KRPR]\JRXV EXW QRW PXWXDOO\ LVRJHQLF GXH WR PDWHUQDO DOOHOH
UHFRPELQDWLRQV E\ PHLRWLF FURVVRYHUV DUH UHSURGXFHG J\QRJHQHWLFDOO\ \LHOGLQJ DW )3 DQ
LVRJHQLF KRPR]\JRXV RIIVSULQJ DXWR]\JRXV FORQH  IURP HDFK PLWRJ\QRJHQHWLF FORQDO
SURJHQLWRU E FURVVLQJRIQRUPDODQGVH[LQYHUWHGILVKIURPWZRGLIIHUHQWFORQHVWRREWDLQ
DW)KHWHURWLFLQWHUFORQDOK\EULGV DOOR]\JRXVFORQH ZLWKHQKDQFHGSHUIRUPDQFHLQFXOWXUH
F  FURVVLQJ RI VHYHUDO FORQHV WR IRUP D PXOWLFORQDO EURRGVWRFN ZKLFK FDQ EH VXEMHFWHG WR
LQWHQVHVHOHFWLYHSUHVVXUHZLWKRDXQW\ULVNRILQEUHHGLQJGHSUHVVLRQ
LLL  ,Q UHODWLRQ WR KLVWRFRPSDWLELOLW\ DQG GLVHDVH UHVLVWDQFH D  WR DQDO\VH WKH
KLVWRFRPSDWLELOLW\ JHQHV\VWHP LQ ILVK E\ GHWHUPLQLQJ WKH IDWH RIVNLQDOORJUDIWV H[FKDQJHG
DPRQJGLIIHUHQWFORQHVDQG E WRGLVFULPLQDWHLQQDWHGLVHDVHUHVLVWDQFHE\FKDOOHQJLQJDVHW
RI FORQHV ZLWK GLIIHUHQW SDWKRJHQV FHUWDLQ FORQHV RI FRPPRQ FDUS H[KLELW D JHQHWLFDOO\
SUHGHWHUPLQHGORZDQWLERG\UHVSRQVHDQGKLJKVXVFHSWLELOLW\WRLQIHFWLRQ
LY  ,Q UHODWLRQ WR WUDQVJHQHVLV WR DFKLHYH KRPR]\JRVLW\ RI WUDQVJHQHV LQ WKH
PLWRJ\QRJHQHWLF SURJHQ\ RI FORQDO RU HYHQ QRQFORQDO WUDQVJHQLF ILVK ZLWK DQ LQLWLDO
KHPL]\JRXV RU PRVDLF WUDQVJHQH GLVWULEXWLRQ WR VHW XS VWDELOL]HG WUDQVJHQLF ILVK OLQHV ZLWK
WUDQVPLVVLRQRIWKHWUDQVJHQLFWUDLW

,W VKRXOG EH QRWHG WKDW LQ WKH FRXUVH RI WLPH LVRJHQLFLW\ PD\ QRW EH PDLQWDLQHG LQ
DXWR]\JRXVFORQHVLQWKHSUHVHQFHRIDQLQWHQVHVSRQWDQHRXVPXWDWLRQUDWH,Q]HEUDILVKDQ
LVRJHQLF FORQH EHFDPH SRO\DOOHOLF DW D PDODWH GHK\GURJHQDVH ORFXV DIWHU  ELVH[XDO
JHQHUDWLRQV 6R UHFORQLQJ PD\ EH QHFHVVDU\ WR HQVXUH JHQHWLF XQLIRUPLW\ WKDW PD\ EH
FKHFNHGE\'1$ILQJHUSULQWLQJ

)UDJPHQWJ\QRJHQHVLV

)UDJPHQWJ\QRJHQHVLVFRQVLVWLQJLQWKHLQFOXVLRQRISDWHUQDOFKURPRVRPHIUDJPHQWV
LQKHULWHGIURP\UD\WUHDWHGVSHUPLQWKHJ\QRJHQRPHKDVEHHQDWWHPSWHGLQUDLQERZWURXW
7KLV DSSURDFK ZRXOG EH HTXLYDOHQW WR D FKURPRVRPHPHGLDWHG JHQH WUDQVIHU DQG PD\ EH
H[SORLWHG D WRPDSJHQHVRQFKURPRVRPHVHVSHFLDOO\LQFDVHRIK\EULGJ\QRJHQRWHV E WR
DLGLQWKHLGHQWLILFDWLRQRIPDMRUJHQHVIRULPSRUWDQWWUDLWVOLNHVH[GHWHUPLQDWLRQDQG F WR
FUHDWH DXWR RU DOORWUDQVJHQLF ILVK IRU PXOWLSOH JHQHV GRQDWHG E\ LVR RU DOORVSHFLILF PDOHV
UHVSHFWLYHO\ ZKHQHYHU FHQWURPHUHEHDULQJ IUDJPHQWV DUH GLSORLGL]HG E\ PLWRWLF EORFN DQG
SHUSHWXDWHGLQWKHGHVFHQGDQWV

$QGURJHQHVLV

6LPLODUO\ WR PLWRJ\QRJHQHVLV GLSORLG DQGURJHQHVLV ZKLFK LQYROYHV WKH JHQHWLF
LQDFWLYDWLRQRIWKHHJJE\LUUDGLDWLRQZLWKGRXEOLQJRIWKHIHUWLOL]LQJVSHUPFKURPRVRPHVHW
LVDOVRDIDVWPHWKRGIRUSURGXFLQJILVKFORQHVLQRQO\WZRJHQHUDWLRQV7KLVLVPXFKIDVWHU
WKDQWKHSURGXFWLRQRISXUHOLQHVE\PXOWLSOHVLEPDWLQJ

(JJ LUUDGLDWLRQ KRZHYHU PD\ GDPDJH QRW RQO\ QXFOHDU '1$ EXW DOVR PLWRFKRQGULDO
'1$DQGRRSODVPLF51$VZKLFKDUHHVVHQWLDOIRUHPEU\RQLFGHYHORSPHQW/RZVXUYLYDORI
DQGURJHQRWHV KDV EHHQ UHSRUWHG LQ YDULRXV VSHFLHV ZLWK VRPH LPSURYHPHQW ZKHQ GLSORLG
VSHUPIURPWHWUDSORLGPDOHVZDVXVHGIRUDQGURJHQHVLV0RUHRYHUORZIHUWLOLW\ZDVREVHUYHG

ϯϱϴ

LQERWKDQGURJHQHWLFPDOHVDQGIHPDOHVRIUDLQERZWURXWDQGYLDELOLW\RI<<LQGLYLGXDOVPXVW
EHHVWDEOLVKHGLQHDFKVSHFLHVZLWK;<VH[XDOFKURPRVRPHV

'HVSLWHWKHVHGUDZEDFNVDQGURJHQHVLVKDVWZRLPSRUWDQWDSSOLFDWLRQV
L ,QUHODWLRQWRVH[FRQWURO D WRSURGXFHGLUHFWO\DOOPDOHSURJHQLHVLQVSHFLHVZLWK
JHQHWLFDOO\ GHWHUPLQHG VH[ PDOH KRPRJDPHW\ DQG EHWWHU SHUIRUPDQFH LQ FXOWXUH RI PDOHV
WKDQIHPDOHVDQDORJRXVO\WRPHLRJ\QRJHQRWHVWKHVHDQGURJHQRWHVPD\WKHQEHVH[LQYHUWHG
LQWRSVHXGRIHPDOHV WRSURGXFHDOOPDOHVWRFNVZKHQ FURVVHGZLWK QRUPDO PDOHVDQG E  WR
REWDLQ<<PDOHVLQFDVHRIPDOHKHWHURJDPHW\ ;< WKDWPD\EHXWLOL]HGWRJHQHUDWHDQDOO
PDOH SURJHQ\ ZKHQ FURVVHG ZLWK QRUPDO IHPDOHV ;;  LL  LQ UHODWLRQ WR VSHUP
FU\RSUHVHUYDWLRQ WR HQVXUH UHFRYHU\ RI ILVK FORQHV RU QDWXUDO HFRW\SLFDO VWUDLQV IURP WKHLU
FU\RSUHVHUYHG VSHUP VWRUHG LQ JHQH EDQNV IRU SHUSHWXDWLRQ RU FRQVHUYDWLRQ JHQHWLFV
SURJUDPV

)XUWKHUPRUH DQGURJHQHVLV PD\ SURYLGH D WRRO IRU DUWLILFLDO VSHFLDWLRQ LQ VHYHUDO VWLOO
WKHRUHWLFDO ZD\V VXFK DV D  IHUWLOL]DWLRQ RI JHQHWLFDOO\ LQDFWLYDWHG HJJV ZLWK VSHUP IURP
SDUWLDOO\IHUWLOHGLSORLGLQWHUVSHFLILFK\EULGVDQGVXEVHTXHQWGLSORLGL]DWLRQE\PLWRWLFEORFN
DQ\ YLDEOH ILVK FRXOG WKHQ EH XVHG WR IRXQG QHZ GLSORLG K\EULG VSHFLHV HDFK UHFHLYLQJ
YDULDEOH JHQRPLF FRQWULEXWLRQV IURP WKH RULJLQDO SDUHQWDO VSHFLHV DQG E  IHUWLOL]DWLRQ RI
JHQHWLFDOO\LQDFWLYDWHG HJJV ZLWK VSHUP IURP DQRWKHUVSHFLHVDQGVXEVHTXHQWGLSORLGL]DWLRQ
WRJLYHULVHWRQXFOHDUF\WRSODVPLFK\EULGV&RQWDLQPHQWRIWKHVHILVKVKRXOGEHHTXLYDOHQWWR
WKDWRIDOORWHWUDSORLGVRXWOLQHGDERYH

&KURPRVRPHVHWPDQLSXODWLRQLQPDULQHILVKFXOWXUH

&KURPRVRPH VHW PDQLSXODWLRQ KDV EHHQ LQYHVWLJDWHG DQG DSSOLHG WR LQFUHDVH
SURGXFWLYLW\ PDLQO\ LQ VDOPRQLGV F\SULQLGV FLFKOLGV DQG LFWDOXULGV 5HVHDUFK RQ IDUPHG
PDULQH ILVK VSHFLHV PRVWO\ EHORQJLQJ WR WKH IDPLOLHV 3OHXURQHFWLGDH 0RURQLGDH DQG
6SDULGDH KDV JHQHUDOO\ EHJXQ PRUH UHFHQWO\ 0HLRWLFDQG PLWRWLF EORFNV KDYHEHHQFDUULHG
RXWZLWKJRRG\LHOGV PRVWO\!DQGXSWR LQERWKVHDEDVVDQGVHDEUHDPXVLQJFROG
VKRFNLQJ ƒ&IRUPLQDWPLQSRVWIHUWLOL]DWLRQ3) DQGSUHVVXUHVKRFNLQJ 
 03D IRU  PLQ DW  PLQ 3)  UHVSHFWLYHO\ 0HLRWLF EORFN LV XVHG WR SURGXFH
WULSORLGV DQG PHLRJ\QRJHQRWHV ZKLOH PLWRWLF EORFN JDYH ULVH WR WHWUDSORLGV DQG
PLWRJ\QRJHQRWHV$VVKRZQLQ)LJXUHWKHSORLG\OHYHORIKDSORLGQRUPDOGLSORLGWULSORLG
DQG WHWUDSORLG VHDEUHDP ZDV HYLGHQFHG E\ WKHLU UHVSHFWLYH NDU\RW\SHV DQG ZDV FRUUHODWHG
ZLWK WKH KLJKHVW QXPEHU RI QXFOHROL SHU QXFOHXV LQ HPEU\RQLF RU ODUYDO FHOOV$QDORJRXVO\
)LJVKRZVWKHNDU\RJUDPVRIVLPLODUO\PDQLSXODWHGVHDEDVV

7KH HIILFDF\ RI FROG VKRFNLQJ LQ WKH PDVV SURGXFWLRQ RI WULSORLG VHDEDVV ZDV DOVR
FRQILUPHG&RQYHUVHO\KHDWVKRFNLQJZDVIRXQGWREHSRRUO\HIIHFWLYH \LHOG DWƒ&
IRU  PLQ DW PLQ 3) EXW YHU\ HIIHFWLYH  \LHOG  DW ƒ& IRU  PLQ DW  PLQ 3)
DOWKRXJKWHWUDSORLGVZHUHDOVRFRQFRPLWDQWO\SURGXFHG/RZSHUFHQWDJHVRIWULSORLG\LQ
VHDEDVV ZHUH REVHUYHG ZLWK SUHVVXUH VKRFN  03D IRU  PLQ DW  PLQ 3)  DQG
F\WRFKDODVLQ % WUHDWPHQW  PJO DW  PLQ 3)  $PRQJ RWKHU VSHFLHV RI WKH IDPLO\
0RURQLGDH WULSORLG\ ZDV LQGXFHG LQ VWULSHG EDVV 0RURQH VD[DWLOLV DQG K\EULG
PHLRJ\QRJHQRWHV ZHUH REWDLQHG IURP HJJV RI VXQVKLQH EDVV IHPDOH 0RURQH FKU\VRSV ;
PDOH0VD[DWLOLV IHUWLOL]HGZLWKLQDFWLYDWHGVSHUPIURPZKLWHSHUFK 0RURQHDPHULFDQD 

,Q6DXUDWDWULSORLG\ZDVUHSRUWHGO\LQGXFHGE\KHDWVKRFNLQJ ƒ&IRUPLQ
DW IHUWLOL]DWLRQ  +HDW VKRFNLQJ DW D UDWKHU KLJK WHPSHUDWXUH &  ZDV DOVR

ϯϱϵ

VXFFHVVIXOO\ DSSOLHG WR JLOWKHDG VHDEUHDP HJJV IHUWLOL]HG ZLWK QRUPDO DQG 89LQDFWLYDWHG
VSHUPRI-DSDQHVHUHGVHDEUHDP3DJUXVPDMRUJLYLQJULVHWRPHLRJ\QRJHQHWLFDQGWULSORLG
K\EULG RIIVSULQJ 5HWHQWLRQ RI WKH VHFRQG SRODU ERG\ ZDV DFFRPSOLVKHG LQ UHG VHDEUHDP
REWDLQLQJWULSORLGVE\FROGVKRFNLQJDQGPHLRJ\QRJHQRWHVE\ERWKFROGDQGKHDWVKRFNLQJV

$QGURJHQHVLVKDVQRWEHHQDWWHPSWHGVRIDULQ'ODEUD[DQG6DXUDWDGHVSLWHWKHIDFW
WKDWWKHWUDQVSDUHQF\RIRYXODWHGHJJVLQWKHVHVSHFLHVPD\DOORZWKHLUJHQHWLFLQDFWLYDWLRQE\
H[SRVXUHWR89OLJKWLQVWHDGRILRQL]LQJUDGLDWLRQ
7R SURYLGH FOXHV IRU IXWXUH UHVHDUFK WKH IROORZLQJ SRLQWV DQG QHZ UHVXOWV DUH ZRUWK
FRQVLGHULQJ

L 7KHUPDOVKRFNVDUHLQHIIHFWLYHLQEORFNLQJWKHILUVWPLWRWLFGLYLVLRQLQERWKVHDEDVV
DQGVHDEUHDPDVDOVRIRXQGLQUHGVHDEUHDP

LL 7HWUDSORLGVDQGPLWRJ\QRJHQRWHVRIVHDEDVVDQGVHDEUHDPVKRZORZHUVXUYLYDO DW
KDWFKLQJDQGGXULQJVXEVHTXHQWGHYHORSPHQWDVFRPSDUHGWRWULSORLGVDQGPHLRJ\QRJHQRWHV
,QSDUWLFXODUZKHQDORWRIVHDEDVVVXEMHFWHGWRPLWRWLFEORFNDQGFRQWDLQLQJWHWUDSORLGV
DQGWKHUHVWGLSORLGVDWKDWFKLQJZDVUDLVHGIRUWHQPRQWKVLWZDVIRXQGWKDWWHWUDSORLGVZHUH
UHGXFHG WR  DIWHU RQH PRQWK DQG ZDV QR ORQJHU SUHVHQW DW HLJKW PRQWKV OHDYLQJ RQO\
VXUYLYLQJGLSORLGV7KHUHIRUHSXUHO\WHWUDSORLGVHDEDVVVKRXOGEHJURZQWRHVWDEOLVKZKHWKHU
WKH\DUHRXWFRPSHWHGE\GLSORLGVRUPHUHO\VKRUWOLYHG


ϯϲϬ

 
)LJXUH0HWDSKDVHFKURPRVRPHSODWHV ODD DQGQXFOHLRIHPEU\RQLFRUODUYDOFHOOV
ZLWKQXFOHROL HYLGHQFHGE\ VLOYHU QLWUDWH VWDLQLQJ  EE REWDLQHGIURPJLOWKHDGVHDEUHDP
6SDUXV DXUDWD  KDSORLG ODE  QRUPDO GLSORLG DE  WULSORLG DE  DQG WHWUDSORLG DE 
LQGLYLGXDOV


LLL 7ULSORLGVHDEDVVDSSHDUWREHVWHULOH,QWULSORLGIHPDOHVWKHZHLJKWRIWKHRYDU\DW
 \HDUV RIDJHZDV RQO\  RI WKDW RIFRQWUROGLSORLGV 7KH RYLJHURXV ODPHOODH FRQWDLQHG
PDLQO\RRJRQLDOQHVWVZLWKRQO\IHZVFDWWHUHGSULPDU\SUHYLWHOORJHQLFRRF\WHVLQGLFDWLQJWKDW
LQLWLDWLRQRIPHLRVLVZDVLPSDLUHG,QWULSORLGPDOHVWKHZHLJKWRIWKHWHVWLVZDVVLJQLILFDQWO\
ORZHU WKDQ WKDW RIGLSORLGV DW EXW QRW DW  \HDUVRI DJH ,Q FRQWUROV WKH WHVWLFXODUOREXOHV
ZHUH IXOO ZLWK F\VWV DW DOO VWDJHV RI VSHUPDWRJHQHVLV ZKLOH LQ WULSORLGV JHUP FHOOV ZHUH
UHSUHVHQWHG RQO\ E\ VFDWWHUHG VSHUPDWRJRQLD DQG PRUH DEXQGDQW SULPDU\ VSHUPDWRF\WHV
7KXV WULSORLG\ LQ VHDEDVV KLQGHUV WKH RQVHW RI PHLRVLV EXW QRW JRQLDO SUROLIHUDWLRQ LQ ERWK
VH[HVDVUHSRUWHGDOVRLQUHGVHDEUHDP


ϯϲϭ

 

)LJXUH  .DU\RJUDPV GHULYHG IURP PHWDSKDVH FKURPRVRPH SODWHV REWDLQHG IURP
(XURSHDQ VHDEDVV 'LFHQWUDUFKXV ODEUD  KDSORuG PHLRJ\QRJHQHWLF GLSORLG WULSORLG DQG
WHWUDSORLGLQGLYLGXDOV

LY  7KURXJKRXW WKH SUHSXEHUWDO SHULRG WKH JURZWK UDWH RI WULSORLG VHDEDVV UHPDLQHG
VLJQLILFDQWO\ORZHUWKDQWKDRWIGLSORLGVLQWZRGLVWLQFWWULDOV,QWKHILUVWRQHWKHPHDQERG\
ZHLJKWDWPRQWKVZDVRIWKDWRIQRUPDOGLSORLGV YVJQ 23 LQ
WKHVHFRQGRQHDWPRQWKVLWZDVRIWKDWRIPHLRJ\QRJHQHWLFGLSORLGV YVJ
Q   DQG  UHVSHFWLYHO\ 3  $W  \U RI DJH KRZHYHU WKH GLYHUJHQFH EHWZHHQ
WULSORLGV DQG GLSORLGV EHFDPH QR ORQJHU VLJQLILFDQWO\ GLIIHUHQW  YV  J  7KLV
VXJJHVWVWKDW EHFDXVHVH[XDO PDWXULW\ LV GHSHQGHQW XSRQ VL]H DQGLV XVXDOO\DWWDLQHGDWWKH
HQRGI WKH QG \HDU LQ PDOHV DQG RI WKH UG \HDU LQ IHPDOHV WKH FXOWXUH RI WULSORLG VHDEDVV
ZRXOGEHFRQYHQLHQWMXVWWRSURGXFHILVKRIELJPDUNHWVL]HRUVXLWDEOHIRUILOOHWLQJ,QUHGVHD
EUHDPQRGLIIHUHQFHLQJURZWKUDWHZDVREVHUYHGEHWZHHQGLSORLGDQGWULSORLGIXOOVLEV

Y  'XULQJ RQ JURZLQJ IRU  PRQWKV WKH PHDQ ERG\ ZHLJKW RI PHLRJ\QRJHQHWLF
VHDEDVVZDVFRPSDUDEOHWRWKDWRIQRUPDOGLSORLGVEXWZDVVLJQLILFDQWO\ORZHUDWPRQWKV

ϯϲϮ

RIDJH YVJQ DQGUHVSHFWLYHO\3 WKRXJKVWLOOJUHDWHUWKDQWKDWRI
WULSORLGV $FWXDOO\ WKH GLIIHUHQFH PHUHO\ LQ WKH ODVW ZHLJKW YDOXHV PD\ EH IRUWXLWRXV DQG
FDQQRW EH UHJDUGHG DV D FRQFOXVLYH SURRI RI D ORZHU SHUIRUPDQFH E\ PHLRJ\QRJHQRWHV ,Q
VHDEUHDP QR VLJQLILFDQW GLIIHUHQFH ZDV REVHUYHG LQJURZWK UDWH EHWZHHQ PH\RJ\QRJHQHWLF
DQGQRUPDOGLSORLGVXSWRPRQWKVRIDJH

YL  7KH SRVVLELOLW\ RI VSRQWDQHRXV GLSORLGL]DWLRQ LQ D VPDOO SHUFHQWDJH RI XQWUHDWHG
J\QRJHQRWHV E\ UHWHQWLRQ RI WKH VHFRQG SRODU ERG\ KDV EHHQ YHULILHG LQ ERWK VHDEDVV DQG
VHDEUHDP$VLPLODUSKHQRPHQRQKDVEHHQGHVFULEHGDOVRLQWKHFRPPRQFDUS

YLL 'HVSLWHWKHIDFWWKDWVHDEDVVPHLRJ\QRGHQRWHVEHDURQO\PDWHUQDOFKURPRVRPHV
WKH\ FDQ VSRQWDQHRXVO\ GLIIHUHQWLDWH LQWR PDOHV 7KLV REVHUYDWLRQ FRXSOHG WR WKH IDFW WKDW
FXOWXUHGGLSORLGVHDEDVVRIWHQGLVSOD\VH[UDWLRVVWURQJO\VNHZHGLQIDYRXURIPDOHV O EXW
VRPHWLPHV DOVR LQ IDYRXU RI IHPDOHV KLQW DW D PRUH FRPSOLFDWHG PHFKDQLVP RI VH[
GHWHUPLQDWLRQ LQ WKLV VSHFLHV WKDQ HDUOLHU VXVSHFWHG $V VXPPDUL]HG LQ 7DEOH  LQ IRXU
GLIIHUHQWH[SHULPHQWVDWWKUHHORFDWLRQVWKHVH[UDWLRRIWKHFRQWUROGLSORLGVUDQJHGIURPO
LQIDYRXURIIHPDOHVDW3HOOHVWULQDWRLQIDYRXURIPDOHVDW(LODWEXWLQFOXGHGDOVRDVH[
UDWLR RI O DW 0RQIDOFRQH 7KHVH GDWD VHHP WR SRLQW DW D WKHUPDO LQIOXHQFH RQ VH[
GHWHUPLQDWLRQ EHFDXVH ILQJHUOLQJV DW WKH KDWFKHU\ RI 3HOOHVWULQD DUH UDLVHG DW D ORZHU ZDWHU
WHPSHUDWXUHWKDQWKDWDW(LODWZKLOH0RQIDOFRQHVWD\LQVEHWZHHQDVLWXWLOL]HVWKHHIIOXHQWVRI
D SRZHU VWDWLRQ 6LJQLILFDQWO\LQ WKH 1LOH WLODSLD 2UHFKURPLV QLORWtFXV H[SRVXUH RI IU\ WR
KLJKWHPSHUDWXUHZDVIRXQGWRLQFUHDVHWKHSURSRUWLRQRIPDOHV+RZHYHUWKHREVHUYHGVH[
UDWLRVRIWKHPHLRJ\QRJHQRWHVGRQRWFRQIRUPWRWKHDVVXPSWLRQWKDWPDOHVSUHYDLODWKLJKHU
ZDWHU WHPSHUDWXUHV $V D PDWWHU RI IDFW ZKLOH PHLRJ\QRJHQRWHV GLIIHUHQWLDWHG PRUH LQWR
IHPDOHVWKHUHODWLYHDEXQGDQFHRIPDOHVZDVJUHDWHUDW3HOOHVWULQDWKDQ(LODWDQGWKXVLWZDV
LQYHUVHO\UHODWHGWRWKHZDWHUWHPSHUDWXUH,WLVUHDOO\VXUSULVLQJWKDWDW3HOOHVWULQDWKHUHZHUH
IHZHU IHPDOHV DPRQJ WKH PHLRJ\QRJHQRWHV WKDQ LQ FRQWURO GLSORLGV 5HFHQWO\ LQ D ORW RI
VHDEDVV PHLRJ\QRJHQRWHV UDLVHG DW D ILVK IDUP LQ 6LFLO\  ZHUH IRXQG WR EH PDOHV 3
%HQHGHWWLSHUVRQDOFRPPXQLFDWLRQ 

$GLIIHUHQWLDWLRQRIJ\QRJHQRWHVLQWRPDOHVKDVEHHQUHSRUWHGDOVRLQWKH1LOHWLODSLD,Q
WKLV VSHFLHV D GXDO V\VWHP RI VH[ FKURPRVRPHV ZLWK KRPRJDPHWLF DQG KHWHURJDPHWLF
LQGLYLGXDOV RIWKHVDPHJHQGHU KDV EHHQ SURSRVHG ,Q DQRWKHU WHOHRVW /HSRULQXV HORQJDWXV
WKH VH[XDO KHWHURFKURPRVRPHV PD\ UHFRPELQH \LHOGLQJ DW\SLFDO VH[ NDU\RW\SHV DQG
XQEDODQFHG VH[ UDWLRV &OHDUO\ PRUH GDWD DUH QHFHVVDU\ WR GLVHQWDQJOH JHQHWLF IURP
HQYLURQPHQWDOHIIHFWVDQGDWSUHVHQWWKHPHFKDQLVPRIVH[GHWHUPLQDWLRQRIVHDEDVVUHPDLQV
REVFXUH$QLQWHUHVWLQJH[SHULPHQWZRXOGEHWRHVWDEOLVKWKHVH[UDWLRLQ)PHLRJ\QRJHQRWHV
GHULYHG IURP IHPDOH PHLRJ\QRJHQRWHV RU HYHQ EHWWHU PLWRJ\QRJHQRWHV  DQG UDLVHG XQGHU
GLIIHUHQWHQYLURQPHQWDOFRQGLWLRQV
YLLL  &RPSOHWH VH[XDO LQYHUVLRQ RI HLWKHU VH[ E\ SUHFRFLRXV DGPLQLVWUDWLRQ RI
KHWHURORJRXVVH[KRUPRQHVZLWKWKHGLHWFDQEHHDVLO\DFFRPSOLVKHGLQVHDEDVVVLPLODUO\WR
RWKHUWHOHRVWV

)HHGLQJDPHWK\OWHVWRVWHURQHDWWKHGRVHRIPJNJ¶IRRGGXULQJRUGD\V
VWDUWLQJ  GD\V SRVWKDWFKLQJ LQFUHDVHG WKH SHUFHQWDJH RI PDOHV IURP  LQ WKH
FRQWUROVWR7UHDWPHQWVVWDUWHGDIWHUGD\VSRVWKDWFKLQJZHUHLQHIIHFWLYH7KHVDPH
DQGURJHQ GRVH JLYHQ HDUOLHU  DQG  GD\ROG ILVK  DQG IRU VKRUWHU SHULRGV  DQG 
GD\V DOVRUHVXOWHGLQPDOHV)XUWKHU¶PDVFXOLQL]DWLRQZDVHTXDOO\HIIHFWLYHLQGD\
ROGILVKDWVDPHGRVHDSSOLHGIRURQO\GD\VRUDWD,2IROGORZHUGRVH PJDQGURJHQNJ¶
IRRG  IRU  GD\V $W  PRQWKV RI DJH SVHXGRPDOHV ZHUH IOXHQW ZLWK PLOW LQGLFDWLQJ D

ϯϲϯ

IXQFWLRQDOVH[XDOLQYHUVLRQ*LYHQWKHJUHDWVHQVLWLYLW\RIVHDEDVVWRDQGURJHQWUHDWPHQWPD\
EHSUREDEO\DWWHQXDWHGHYHQPRUH7KLVVSHFLHVLVDOVRUHVSRQVLYHWRHVWURJHQDGPLQLVWUDWLRQ
EHFDXVHDKLJKGRVHRIHVWUDGLRO PJNJ¶IRRG JLYHQWRDQGGD\ROGILVKIRU
 GD\V \LHOGHG  IHPDOHV ,Q WKLV FDVH WRR LW LV ZRUWK H[SORULQJ ORZHU GRVDJHV DQG
VKRUWHUSHULRGVRIWUHDWPHQW

$OOIHPDOHVWRFNVRIVHDEDVVZRXOGEHFHUWDLQO\PRUHSURGXFWLYHLQFXOWXUHDVIHPDOHV
JURZ IDVWHU WKDQPDOHV DQGPDWXUH VH[XDOO\ \HDUVODWHU 1RQHWKHOHVV LI XQOLNH LQ WURXW
IDUPLQJ DOOIHPDOH SURJHQLHV FDQQRW EH REWDLQHG E\ FURVVLQJ QRUPDO IHPDOHV ZLWK
SVHXGRPDOHVGXHWRWKHSUREOHPVGLVFXVVHGDWSRLQWWKHQGLUHFWIHPLQL]DWLRQPLJKWEHDQ
DOWHUQDWLYHWREHFRQVLGHUHG,QWKH(XURSHDQ&RPPXQLW\WKLVZRXOGUHTXLUHWKHDGGLWLRQRID
VSHFLILFDXWKRUL]DWLRQLQWKHH[LVWLQJ'LUHFWLYH

7KLVIRUELGVWKHDGPLQLVWUDWLRQWRDTXDFXOWXUHDQLPDOVRIVXEVWDQFHVZLWKDQGURJHQLFRU
HVWURJHQLF DFWLRQ EXW DXWKRUL]HV WKH WUHDWPHQW RI \RXQJ ILVK IRU WKH ILUVW  PRQWKV ZLWK
DOORZHGDQGURJHQXQGHUYHWHULQDULDQFRQWUROIRUWKHSXUSRVHRIVH[LQYHUVLRQ7KHH[WHQVLRQ
RIWKLVH[FHSWLRQWRQDWXUDOHVWURJHQVWRIHPLQL]HVHDEDVVDSSHDUVQRWWREHREMHFWLRQDEOHRQD
VFLHQWLILFEDVLVXQGHUVSHFLILFFLUFXPVWDQFHVVXFKDV D ,QFOXVLRQLQWKHIHHGRIILVKRYDULDQ
PHDOOLNHJURXQGGULHGWURXWRYDULHVZKLFKDUHDZDVWHSURGXFWRIWKHILOOHWLQJSURFHVVEXWDUH
HQULFKHGLQHVWURJHQDWPDWXULW\DOWHUQDWLYHO\SUHSDUDWLRQRIDQHTXLYDOHQWIHHGREWDLQHGE\
WKHGLUHFWDGGLWLRQRIHVWUDGLRO‰LQDVLPLODUO\ORZFRQFHQWUDWLRQDQG E $GPLQLVWUDWLRQ
RIVXFKIHHGVWRVHDEDVVMXVWDIWHUZHDQLQJDQGIRUOHVVWKDQWKUHHPRQWKVHVSHFLDOO\LIUDLVHG
LQ D FORVHG V\VWHP ZLWK UHFLUFXODWLQJ ZDWHU RWKHUZLVH WKH ZDWHU HIIOXHQW PD\ XQGHUJR D
GHSXUDWLRQ VWHS ELRORJLFDO ILOWUDWLRQ ODJRRQLQJ HWF  WR FXW GRZQ DQ\ UHVLGXDO HVWURJHQ
OHDNDJH LQWR WKH HQYLURQPHQW 7KLV DSSURDFK ZRXOG EH DEVROXWHO\ VDIH IRU WKH FRQVXPHU
EHFDXVH QR PHDVXUDEOH WUDFH ZKDWVRHYHU RI H[RJHQRXV HVWURJHQ ZRXOG EH OHIW LQ WKH PHDW
DIWHUPRUHWKDQRQH\HDULQFXOWXUH,WLVQRWHZRUWK\WKDWHVWURJHQSURGXFWLRQLQILVKLVPRUH
ZLGHVSUHDG WKDQ LQ PDPPDOV DV VXEVWDQWLDO TXDQWLWLHV DUH SURGXFHG DOVR E\ WKH EUDLQ DQG
RWKHU RUJDQV EHVLGHV WKH RYDU\ 7KLV QRUPDO HQGRJHQRXV FRQFHQWUDWLRQ ZRXOG RYHUVKDGRZ
DQ\LPSUREDEOHUHPQDQWRIIHPLQL]LQJHVWURJHQ

L[  +RUPRQDO VWHULOL]DWLRQ KDV QRW \HW EHHQ FDUULHG RXW LQ VHDEDVV EXW SDUWLDO
VWHULOL]DWLRQ ZDV UHSRUWHG ZKHQ PDVFXOLQL]LQJ RU IHPLQL]LQJ WUHDWPHQWV ZHUH SHUIRUPHG LQ
ROGHUILVKLHDWDQGGD\VRIDJH

&RPSOHWH VWHULOL]DWLRQ LV OLNHO\ WR UHTXLUH SURORQJHG KRUPRQDO H[SRVXUH DV LQ RWKHU
VSHFLHV EXW WKLV HQJHQGHUV SUREOHPV DERXW FRQVXPHU VDIHW\ DQG DFFHSWDQFH HQYLURQPHQWDO
SURWHFWLRQ DJDLQVW KRUPRQDO UHVLGXHV DQG SURGXFHU¶V FRQYHQLHQFH EHFDXVH VHDEDVV JURZWK
ZDVIRXQGWREHDGYHUVHO\DIIHFWHGE\IHHGLQJDQGURJHQIRUPRUHWKDQGD\V7KHUHIRUHDW
SUHVHQWWKLVDSSURDFKVHHPVLPSUDFWLFDO

OQWHUVSHFLILFDQGLQWHUJHQHULFK\EULGL]DWLRQ

OQWHUVSHFLILF DQG LQWHUJHQHULF K\EULGL]DWLRQ KDV FRQWULEXWHG JUHDWO\ WR JHQHWLF DQG
SURGXFWLYH LPSURYHPHQWV LQ DJULFXOWXUH EXW PXFK OHVV VR LQ WHUUHVWULDO DQLPDO KXVEDQGU\
ZKLFKKDVPRVWO\SULYLOHJHGLQWHUUDFLDO LQWUDVSHFLILF K\EULGL]DWLRQ,QILVKFXOWXUHKRZHYHU
LQWHUEUHHGLQJRIGLIIHUHQWVSHFLHVRUJHQHUDPD\EHRIJUHDWHUSUDFWLFDOYDOXHWKDQJHQHUDOO\
EHOLHYHGHVSHFLDOO\LQPDULQHILVKIDUPLQJ)DFLOLWDWHGE\WKHLUSUHYDOHQWO\H[WHUQDOPRGHRI
UHSURGXFWLRQKLJKIHFXQGLW\IUHTXHQWPDVVVSDZQLQJKDELWVDQGUDWKHUFRPPRQUHFLSURFDO
JHQHWLFFRPSDWLELOLW\WHOHRVWVFDQK\EULGL]HVSRQWDQHRXVO\LQQDWXUHDQGDUHUHODWLYHO\HDV\

ϯϲϰ

WRK\EULGL]HLQ FXOWXUH$FWXDOO\K\EULGVKDYHEHHQSURGXFHG ZLWKLQHDFK ERQ\ ILVK IDPLO\
WKDWLQFOXGHVVSHFLHVEUHHGLQJLQFDSWLYLW\

1DWXUDOK\EULGL]DWLRQ

&ORVHO\ UHODWHG VSHFLHV ZLWK LVRFKURQRXV UHSURGXFWLYH VHDVRQV DQG HVSHFLDOO\ WKRVH
UHO\LQJRQFRPPXQDOVSDZQLQJUDWKHUWKDQRQFRPSOH[FRXUWVKLSSDWWHUQVDUHPRUHOLNHO\WR
K\EULGL]HLQQDWXUH6SRQWDQHRXVK\EULGVKRZHYHUDUHUHODWLYHO\UDUHDPRQJPDULQHVSHFLHV
DV FRPSDUHG WR WKRVH OLYLQJ LQ IUHVKZDWHU +HUH HQYLURQPHQWDO LQVWDELOLW\ SUHFLSLWDWLQJ
FRQILQHPHQW RI GLIIHUHQW VSHFLHV ZLWKLQ D UHVWULFWHG ZDWHU ERG\ UHGXFWLRQ RI VSDZQLQJ
JURXQGV E\ PDQLQGXFHG KDELWDW DOWHUDWLRQV PDVVLYH UHVWRFNLQJ ZLWK NLQGUHG VSHFLHV RU
LQWURGXFWLRQVRIDOLHQVSHFLHVDUHRIWHQFLWHGDVFDXVHVRIK\EULGL]DWLRQLQILVKHV7KHOHVVHU
LPSRUWDQFHRIWKHVHIDFWRUVLQWKHPDULQHHQYLURQPHQWDQGLWVUHODWLYHVWDELOLW\PD\H[SODLQ
WKHUDULW\RIPDULQHILVKK\EULGV

$PRQJIUHVKZDWHUWHOHRVWVLQWHUJHQHULFK\EULGVDUHFRPPRQLQWKHIDPLO\&\SULQLGDH
ZKHUHDV K\EULGV WHQG WR EH LQWUDJHQHULF LQ WKH RWKHU IDPLOLHV1RUPDOO\RQO\ ), K\EULGV RI
ZLOG VSDZQHUV DUH IRXQG LQ QDWXUH VRPHWLPHV DV UHFLSURFDO K\EULGV OQWURJUHVVLYH
K\EULGL]DWLRQ E\ EDFNFURVVLQJ DQG PXOWLSOH K\EULGL]DWLRQ RFFXU H[FHSWLRQDOO\ EHFDXVH RI
K\EULGVWHULOLW\UHGXFHGIHUWLOLW\RULQDGHTXDWHPDWLQJDELOLW\7KH\DUHQHYHUWKHOHVVUHSRUWHG
DV WKH ILQGLQRJI D QDWXUDO WULSOHE DVV K\EULG UHVXOWLQJ IURP WKH FURVVLQJ EHWZHHQ D K\EULG
SUREDEO\ 0 FKU\VRSV ; 0 VD[DWLOLV  DQG D WKLUG VSHFLHV WKH \HOORZ EDVV 0RURQH
PLVVLVVLSLHQVLV6RPHWLPHVDVLQVDOPRQLGV)K\EULGVDUHOHVVILWWKDQ)K\EULGV

$UWLILFLDOK\EULGL]DWLRQ

,QFXOWXUHVWUDLJKW)K\EULGL]DWLRQFDQEHFDUULHGRXWE\ L YROLWLRQDOWDQNVSDZQLQJ
RI FDSWLYH IHPDOHV RI RQH VSHFLHV KHOG LQ FRKDELWDWLRQ ZLWK PDOHV RI DQRWKHU VSHFLHV
SDUWLFXODUO\LIJDPHWHUHOHDVHLVVWLPXODWHGE\H[RJHQRXVKRUPRQHV LL DUWLILFLDOIHUWLOL]DWLRQ
RIWKHHJJVRIRQHVSHFLHVZLWKWKHIUHVKVSHUPIURPDGLIIHUHQWUHSURGXFWLYHO\V\QFKURQRXV
VSHFLHVRUYLFHYHUVDWRJHQHUDWHWKHUHFLSURFDOK\EULGVDQG LLL DUWLILFLDOIHUWLOL]DWLRQRIWKH
HJJVRIRQHVSHFLHVZLWKWKHFU\RSUHVHUYHGVSHUPIURPDQRWKHUVSHFLHVWKXVPXOWLSO\LQJWKH
QXPEHU RI SRVVLEOH FURVVHV E\ LQFOXVLRQ RI PDOHV EHORQJLQJW R QRQV\QFKURQRXV RU H[RWLF
VSHFLHV :KHQHYHU ) K\EULGV DUH DW OHDVW SDUWLDOO\ IHUWLOH WKHUH DUH ILYH FRQFHLYDEOH
RSWLRQVIRU IXUWKHU K\EULGL]DWLRQ VXFK DV L  EUHHGLQJ RIHTXLYDOHQW K\EULGV IURP WKH VDPH
SDUHQWDO VSHFLHV ) K\EULGL]DWLRQ  L  LQWHUFURVVLQJ RI UHFLSURFDO K\EULGV IURP WKH VDPH
SDUHQWDO VSHFLHV ) UHFLSURFDO K\EULGL]DWLRQ  LLL  LQWHUFURVVLQJ RI K\EULGV IURP GLIIHUHQW
SDUHQWDO VSHFLHV ZLWK IRXU SRVVLEOH FRPELQDWLRQV RI K\EULGV DQG WKHLU UHFLSURFDO K\EULGV
GRXEOHK\EULGL]DWLRQ  £Y EDFNFURVVLQJRIK\EULGVZLWKRQHRUERWKRIWKHLUSDUHQWDOVSHFLHV
LQWURJUHVVLYH K\EULGL]DWLRQ  DQG Y  FURVVLQJ RI K\EULGV ZLWK D WKLUG QRQSDUHQWDO VSHFLHV
UHK\EULGL]DWLRQ 

+\EULGL]DWLRQDQGVHOHFWLRQ

,QDOOWKHVHFDVHVRZLQJWRWKHFDVXDOVHJUHJDWLRQRIWKHSDUHQWDOFKURPRVRPHVGXULQJ
JDPHWRJHQHVLVLQWKH)K\EULGVWKHJHQHWLFFRQWULEXWLRQV RIHDFK RULJLQDO SDUHQWDO VSHFLHV
)  WR WKH GLSORLG FKURPRVRPH VHW RI HDFK QHZ ) K\EULG ZLOO EH WRWDOO\ DW UDQGRP 7KLV
JHQRW\SLF KHWHURJHQHLW\ DPRQJ ) K\EULGV LV OLNHO\ WR EH DVVRFLDWHG ZLWK SKHQRW\SLF
KHWHURJHQHLW\LQWHUPVRISHUIRUPDQFHLQFXOWXUH$SDUWIURPLQWURJUHVVLYHK\EULGL]DWLRQWKDW
WKURXJK VXFFHVVLYH FURVVHV WHQGV WR GLVSHUVH WKH LQLWLDO VKXIIOLQJ RI KHWHURVSHFLILF

ϯϲϱ

FKURPRVRPHV ZLWKLQ WKH EURDGHU JHQHWLF SRRO RI WKH SDUHQWDO VSHFLHV WKXV PLQLPL]LQJ
JHQRW\SLF KHWHURJHQHLW\ WKH ODWWHU ZLOO EH SHUSHWXDWHG ZKHQ DSSO\LQJ ) K\EULGL]DWLRQ RU
DXJPHQWHG ZLWK GRXEOH K\EULGL]DWLRQ RU UHK\EULGL]DWLRQ 7KH SLFWXUH PD\ EH IXUWKHU
FRPSOLFDWHG E\ FURVVRYHUV EHWZHHQ SDUHQWDO FKURPRVRPHV LI SUHVHQW 7KLV PHDQV WKDW
VHOHFWLRQRI)K\EULGVIRUFRPSOH[WUDLWVZLOOEHPXFKPRUHGLIILFXOWWRFRQWUROWKDQLQSXUH
VSHFLHVEHFDXVHRIWKHH[FHVVRIYDULDWLRQXQOHVVEDFNFURVVLQJLVLQWURGXFHGDWDQHDUO\VWDJH
7KH LQWURJUHVVLYH DSSURDFK ZDV VXFFHVVIXOO\ DGRSWHG LQ WKH 6RYLHW 8QLRQ ZKHUH WKH
LQWHUJHQHULF K\EULG RI WKH FRPPRQ FDUS ; FUXFLDQ FDUS &DUDVVLXV FDUDVVLXV ZDV
EDFNFURVVHG WR FRQIHU XSRQ RQH SDUHQWDO VSHFLHV GLVWLQFWLYH WUDLWV RI WKH RWKHU SDUHQWDO
VSHFLHV +\EULGV EHWZHHQ 2QFRUK\QFKXV P\NLVV DQG EURZQ WURXW SURGXFHG VRPH WURXW RI
JROGHQDSSHDUDQFHEXWWKHK\EULGDVH[SHFWHGGLGQRWEUHHGWUXH

5HSRUWVRIWKLVVRUWDUHVSRUDGLFDQGVFDUFHO\GRFXPHQWHGEXWWKH\DUHRILQWHUHVWEHLQJ
H[DPSOHV RI PXOWLSOH  JHQH WUDQVIHU E\ FRQYHQWLRQDO EUHHGLQJ WHFKQLTXHV 7KH IDFW WKDW
IRUHLJQ JHQHV ZHUH LQVHUWHG LQWR D VSHFLHV E\ JHQHWLF LQWHUPLQJOLQJ WKURXJK K\EULGL]DWLRQ
UDWKHUWKDQE\JHQHWLFDGGLWLRQWKURXJKHJJPLFURLQMHFWLRQRUJDPHWHHOHFWURSRUDWLRQGRHVQRW
VHHPWR MXVWLI\ LQ VXFK WULDOV ZLWK IHUWLOH ILVK WKH WRWDO ODFN RI WKRVH FRQWDLQPHQW PHDVXUHV
WKDWDUHXVXDOO\LPSRVHGRQH[SHULPHQWVZLWKWUDQVJHQLFILVK

7KH XVH RI LQWHUVSHFLILF K\EULGL]DWLRQ DV D SUHOLPLQDU\ VWHS WR VHOHFWLYH EUHHGLQJ
DSSHDUV WR EH RI TXHVWLRQDEOH SUDFWLFDO DGYDQWDJH EHFDXVH RI WKH IUHTXHQW ORZ IHUWLOLW\ RI
K\EULGVWKH ORQJ SHULRGRI WLPH UHTXLUHG IRUWKH LQWURJUHVVLRQ RI WKH KHWHURVSHFLILF WUDLW E\
UHSHDWHG EDFNFURVVLQJ WKH ULVN RI WKH DFFLGHQWDO GLVSHUVDO RI WKH IHUWLOH K\EULGV RU WKHLU
LQWURJUHVVHG GHVFHQGDQWVLQWR WKH QDWXUDO HQYLURQPHQW GXULQJ WKH KDQGOLQJ RI WKH QXPHURXV
ILVKXQGHUVHOHFWLRQDQGWKHSRVVLELOLW\RIORVLQJWKHKHWHURVSHFLILFWUDLWGXULQJLQWURJUHVVLRQ
5DWKHUWKDQWUDQVIHUULQJJHQHVDVDUHVXOWRIK\EULGL]DWLRQIROORZHGE\VHOHFWLYHLQWURJUHVVLRQ
LW ORRNV PXFK PRUH FRQYHQLHQW WR SRVWSRQH K\EULGL]DWLRQ WR JHQH WUDQVIHU E\ JDPHWH RU
HPEU\R PDQLSXODWLRQ WR H[SORLW K\EULG VWHULOLW\ IRU WKH UHSURGXFWLYH FRQWDLQPHQW RI WKH
WUDQVJHQLFILVKDVVXJJHVWHGEHORZ

+\EULGL]DWLRQDQGFKURPRVRPHVHWPDQLSXODWLRQ
$QRWKHU DWWUDFWLYH DSSURDFK LV WKH LQWHJUDWLRQ RI LQWHUVSHFLILF DQG LQWHUJHQHULF
K\EULGL]DWLRQZLWKFKURPRVRPHVHWPDQLSXODWLRQWHFKQLTXHVDVRXWOLQHGDERYH$OORWULSORLG
ILVKREWDLQHGHLWKHUE\K\EULGL]LQJWZRGLSORLGVSDZQHUVEHORQJLQJWRGLIIHUHQWVSHFLHVZLWK
VXEVHTXHQW UHWHQWLRQ RI WKH VHFRQG SRODU ERG\ RU E\ FURVVLQJ DOORWHWUDSORLGV ZLWK GLSORLG
PDWHVVKRXOGEHDEVROXWHO\VWHULOHEHFDXVHRIERWKWKHLUK\EULGQDWXUHDQGWULSORLGFRQGLWLRQ
$OORWULSORLGVSURGXFHGE\FURVVLQJIHPDOH6DXUDWD;PDOH3PDMRUZLWKVHFRQGSRODUERG\
UHWHQWLRQFRXOGEHGLIIHUHQWLDWHGSKHQRW\SLFDOO\IURPGLSORLGK\EULGVHYHQDWWKHILQJHUOLQJ
VWDJH WKXV PDNLQJ D FKHFN RQ SORLG\ VWDWXV GLUHFWO\ IHDVLEOH *RUVKNRYHDW DO  
,QGXFWLRQ RI WULSORLG\ PD\ EH DSSOLHG WR K\EULGV IURP WD[RQRPLFDOO\ UHODWHG VSHFLHV WR
HOLPLQDWHDQ\ UHVLGXDO IHUWLOLW\DQG ULVN RILQWURJUHVVLRQ LQ QDWXUH ZLWK WKH SDUHQWDO VSHFLHV
7KLVULVNLVRIWHQQHJOHFWHGLQILVKFXOWXUHRQWKHJURXQGVWKDWHYHQLIIHUWLOHK\EULGVDUHQRW
LQFOLQHG WR UHSURGXFH LQ WKH ZLOG DV LQGLFDWHG DERYH 6XFK DQ DUJXPHQW PD\ EH IXUWKHU
VWUHQJWKHQHGZKHQHYHUHTXLYDOHQWRUVLPLODUK\EULGVDULVHVRPHWLPHVVSRQWDQHRXVO\LQQDWXUH
GXHWRZHDNLQWHUVSHFLILFERXQGDULHV

7ULSORLG\ PD\ DOVRE H WKH QDWXUDO RXWFRPHR I D K\EULGL]DWLRQ HYHQW )HPDOHV RI WKH
UHFLSURFDOFURVVHV2ODWLSHV;2U\]LDVFXUYLQRWXVVKRZUHGXFHGIHUWLOLW\DQGRYXODWHGGLSORLG
HJJVZLWKRQHFRPSOHWHFKURPRVRPHVHWIRUHDFKSDUHQWDOVSHFLHVVRWKDWZKHQEDFNFURVVHG

ϯϲϲ

WKH\JLYHULVHWRDWULSORLGSURJHQ\$VLPLODUILQGLQJZDVUHSRUWHGDOVRIRUWKHK\EULGVRIWKH
FURVVFUXFLDQFDUS&DXUDWXVJLEHOLR;FRPPRQFDUS

,Q FRPSDULVRQ ZLWK SUR[LPDO K\EULGV VWHULOLW\ LV H[SHFWHG WR EH PRUH VHYHUH RU
FRPSOHWH LQ GLSORLG K\EULGV ERUQ IURP V\VWHPDWLFDOO\ GLVWDQW VSHFLHV OLNH LQ LQWHUJHQHULF
K\EULGL]DWLRQ RZLQJ WR XQVXFFHVVIXO SDLULQJ RI WKH KRPRORJRXV FKURPRVRPHV $V D
FRQVHTXHQFHJRQDGDOGHYHORSPHQWLVRIWHQPDUNHGO\LPSDLUHG3DUWLDOJHQHWLFK\EULGL]DWLRQ
DFKLHYHG E\ ERWK IUDJPHQW J\QRJHQHVLV DQG QXFOHDU F\WRSODVPLF K\EULGL]DWLRQ E\ HLWKHU
DQGURJHQHVLV RU QXFOHDU WUDQVSODQWDWLRQ LV RI JUHDW H[SHULPHQWDO LQWHUHVW EXW LW SRVHV
FRQWDLQPHQWSUREOHPVIRUIDUPLQJEHFDXVHWKLVNLQGRIDUWLILFLDOK\EULGVLVQRWH[SHFWHGWREH
VWHULOH$WHFKQLTXHIRUWKHSURGXFWLRQRIQXFOHDUF\WRSODVPLFK\EULGVE\WUDQVSODQWLQJQXFOHL
IURP FRPPRQ FDUS HJJV LQWR WKH F\WRSODVP RI & DXUDWXV HJJV ,W ZDV VKRZQ WKDW WKH
H[SUHVVLRQ RI PHULVWLF WUDLWV VXFK DV WKH QXPEHU RI YHUWHEUDH RU SKDU\QJHDO WHHWK LV
LQIOXHQFHGE\ERWKWKHQXFOHXVDQGWKHF\WRSODVP

$GYDQWDJHVRIK\EULGL]DWLRQ

%HVLGHV VWHULOLW\ K\EULGV PD\ GLVSOD\ RWKHU SRVLWLYH WUDLWV WKDW QHYHUWKHOHVV FDQQRW EH
SUHGLFWHG IURP WKH NQRZOHGJH DERXW WKHLU SDUHQWDO VSHFLHV DQG PD\ EH DEVHQW DOWRJHWKHU
SDUWLFXODUO\LQFHUWDLQWHOHRVWIDPLOLHV9HU\IHZRIWKHLQWHUVSHFLILFDQGLQWHUJHQHULFK\EULGV
RI VDOPRQLGV DQG F\SULQLGV KDYH DQ\ IDUPLQJ RU UHVWRFNLQJ SRWHQWLDO EHFDXVH RI WKHLU ORZ
YLDELOLW\ RU LQIHULRU SHUIRUPDQFH ZLWK UHVSHFW WR WKH SDUHQWDO VSHFLHV :KHQ WKLQJV JR
RWKHUZLVH WKHUH DUH ILYH SRVVLEOH RXWFRPHV RI K\EULGL]DWLRQ ZKLFK PD\ UHVXOW EHQHILFLDO
LQWHUPHGLDF\FRPELQDELOLW\OX[XULDQFHPRQRVH[XDOLW\DQGQRYHOW\

,QWHUPHGLDF\ WKDW LV WKH IDFW WKDW PRUSKRPHWULFDQG PHULVWLF WUDLWV RI WKH K\EULGV DUH
VRPHKRZLQWHUPHGLDWHEHWZHHQWKRVHRIWKHSDUHQWDOVSHFLHVKDVEHHQFRQILUPHGLQVHYHUDO
FDVHV7KLVPD\FUHDWHPRUHDSSHDOLQJIRUPVRIILVKSDUWLFXODUO\LQRUQDPHQWDOILVKFXOWXUH

&RPELQDELOLW\ UHIHUV WR WKH SRVVLELOLW\ RI FRPELQLQJ LQ WKH K\EULGV IDYRXUDEOH
FKDUDFWHULVWLFVSURSHURIHDFKSDUHQWDOVSHFLHV)RULQVWDQFH WKH VWXUJHRQ K\EULG FDOOHG WKH
EHVWHU FRPELQHV WKH IDVW JURZWK UDWH RI WKH JUHDW EHOXJD +XVR KXVR ZLWK WKH IUHVKZDWHU
WROHUDQFH RI WKH WLQ\ VWHUOHW $FLSHQVHU UXWKHQXV$V WKH EHVWHU LV D IHUWLOH VHOISHUSHWXDWLQJ
EUHHGLWSURYLGHVDQH[DPSOHRIDUWLILFLDOVSHFLDWLRQWROHUDWHGEHFDXVHRILWVEHQHILWV

/X[XULDQFH LV DQ LPSRUWDQW JRDO RI DUWLILFLDO K\EULGL]DWLRQ DQG LV PRVWO\ PHDQW WR
GHQRWH D VXSHULRU JURZWK UDWH RI WKH K\EULGV ZLWK UHVSHFW WR WKH SDUHQWDO VSHFLHV
(QKDQFHPHQW RIDW OHDVWHDUO\ JURZWK UDWHLVD UHFXUUHQWIHDWXUHLQVHYHUDOK\EULGVDQGPD\
UHIOHFWWKHDWWHQXDWLRQRILQKLELWRU\UHJXODWLRQVRQJURZWKZKHQHYHUWKHXQGHUO\LQJPROHFXODU
PHFKDQLVPVLQKHULWHGIURP WKH SDUHQWDO VSHFLHVUHVXOWLQFRPSDWLEOHRUSRRUO\KDUPRQL]DEOH
ZLWKLQ WKH K\EULG )RU LQVWDQFH WKH UHGXFWLRQ RI WKH HQHUJ\ H[SHQGLWXUH IRU GHIHQFH
PHWDEROLVP HVSHFLDOO\ ZKLFK LQYROYHG LQ WKH UHDFWLRQ WR VWUHVV VWLPXOL PD\ GLYHUW PRUH
HQHUJ\WRZDUGVDX[RJHQLFSURFHVVHV,QWHUHVWLQJO\WKHVXQVKLQHEDVV IHPDOH0FKU\VRSV;
PDOH 0 VD[DILOLV  VKRZV D ORZHU UHVSRQVLYHQHVV WR VWUHVVRUV WKDQ WKH SDWHUQDO VSHFLHV DV
PHDVXUHG E\ WKH LQFUHDVH LQ SODVPD FRUWLVRO OHYHO LQGXFHG E\ D VWDQGDUGL]HG FRQILQHPHQW
VWUHVV 7KLV WUDLW WKDW ZRXOG EH KD]DUGRXV LQ QDWXUH EHFDXVH LW UHGXFHV DOHUWQHVV WRZDUGV
WKUHDWVEHFRPHVDSRVLWLYHDWWULEXWHLQFXOWXUHEHFDXVHLWOHDYHVPRUHHQHUJ\IRUDIDVWHUHDUO\
JURZWK UDWH DQG LQFUHDVHV UHVLVWDQFH WR LQIHFWLRQ DQG KHQFH VXUYLYDO DV D FRQVHTXHQFH RI
OLJKWHUFRUWLFRVWHURLGLPPXQHVXSSUHVVLRQ/X[XULDQFHVKRXOGQRWEHFRQIXVHGZLWKKHWHURVLV
LHWKHLPSURYHPHQWRISHUIRUPDQFHWKDWPDUNVFHUWDLQFURVVHV EHWZHHQFRQVSHFLILFLQEUHG

ϯϲϳ

OLQHV /X[XULDQFH LV WKH RXWFRPH RI K\EULGL]DWLRQ SHU VH WKDW LV WKH PL[LQJ RI JHQRPHV
EHORQJLQJWRGLVWLQFWSK\ORJHQHWLFOLQHVDQGLVOLNHO\WREHPRUHHYLGHQWLQZLGHUWD[RQRPLF
FURVVHV ZKLOH EHLQJ UHODWLYHO\ LQGHSHQGHQW IURP WKH SDUWLFXODU JHQRW\SHV RI WKH VSDZQHUV
7KHVXSHULRULW\RIWKHOX[XULDQWK\EULGVZLWKUHVSHFWWRERWKSDUHQWDOVSHFLHVLVPRUHHDVLO\
H[SODLQDEOHDVDVXEWUDFWLYHHIIHFWQDPHO\WKHORVVRIDQXQZDQWHGIXQFWLRQZKLOHUHWDLQLQJ
DOORWKHUYLWDOFDSDFLWLHVDQGKRPHRVWDWLFSRZHUKHQFHDIRUWXQDWHFRPSURPLVHUDWKHUWKDQDV
DV\QHUJLVWLFFRPSOHPHQWDULW\EHWZHHQSDUHQWDOWUDLWV7KLVOX[XULDQFHHYHQWLVPRUHOLNHO\WR
RFFXUZKHQWKH SDUHQWDO VSHFLHV KDYH JHQRPHV WKDW DUH HTXLYDOHQW LQ VL]HDQGFKURPRVRPH
QXPEHU2WKHUZLVHDQHXSORLG\DQGGHYHORSPHQWDODEQRUPDOLWLHVPD\HQVXH

,I)K\EULGVDUHIHUWLOHOX[XULDQFHPD\QRWEHPDLQWDLQHGLQ)K\EULGVEHFDXVHRIWKH
DIRUHPHQWLRQHGUDQGRPUHFRPELQDWLRQRIWKHSDUHQWDOFKURPRVRPHVDQGEHFDXVHFURVVRYHUV
LI DQ\ EHWZHHQ SDUHQWDO FKURPRVRPHV LQ WKH ), JHQHUDWLRQ ZLOO FDXVH FKURPRVRPDO
K\EULGL]DWLRQLHH[FKDQJHDQGLQFRUSRUDWLRQRIKHWHURVSHFLILFFKURPRVRPDOVHJPHQWVZLWK
SRVVLEOH GHWULPHQWDO SRVLWLRQDO HIIHFWV DPRQJ JHQHV OLQNHG ZLWKLQ WKH VDPH FKURPRVRPHV
7KLVZRXOGEHLQDJUHHPHQWZLWKWKHREVHUYHGLQIHULRUILWQHVVRIVDOPRQLGK\EULGLVPWKH)
SURJHQ\WKDQLQWKH)

&RQYHUVHO\ KHWHURVLV LV QRW GXH WR LQWHUEUHHGLQJ E\ LWVHOI EXW GHSHQGV XSRQ WKH
SDUWLFXODU JHQRW\SHV RI WKH LQEUHG OLQHV WR EH FURVVHG 7KHVH PXVW JLYH ULVH WR D SURSLWLRXV
KHWHUR]\JRXV FRQGLWLRQ LQ ZKLFK VSHFLILF JHQHWLF GHWHUPLQDQWV SURPRWH SRVLWLYH HIIHFWV
WKURXJKGRPLQDQFHRURYHUGRPLQDQFHLQWHUDFWLRQV+HWHURVLVWRRLVQRWPDLQWDLQHGLQWKH)
DQG VXEVHTXHQW JHQHUDWLRQV RZLQJ WR WKH GHFUHPHQW RI KHWHUR]\JRVLW\ LQ SDUW RI WKH
RIIVSULQJV6RERWKOX[XULDQFHDQGKHWHURVLVUHSUHVHQWVKRUWWHUPJHQHWLFJDLQVLQWKHVHQVH
WKDWWKH\DUHDWWDLQDEOHLQWKHILUVWSURJHQ\DQGFDQQRWEHLPSURYHGIXUWKHU7KHLULPPHGLDWH
DSSHDUDQFHKRZHYHU GRHV QRW PHDQ WKDW WKH\ FDQE H DFKLHYHG TXLFNO\EHFDXVH WRILQG WKH
ULJKWFRPELQDWRLRQRIVSHFLHVIRUOX[XULDQFHRULQEUHGOLQHVIRUKHWHURVLVPD\WDNHTXLWHVRPH
WLPH

0RQRVH[XDOLW\ LV VRPHWLPHV H[KLELWHG E\ LQWHUVSHFLILF K\EULGV DQG PD\ EH H[SORLWHG
ZKHQHYHUWKHH[FOXVLYHVH[SHUIRUPVEHWWHULQFXOWXUHWKDQWKHRWKHU$OOIHPDOHK\EULGVZHUH
SURGXFHG IURP WKH FURVV EHWZHHQ IHPDOH 0 VD[DWLOLV ; PDOH 0PLVVLVVLSSLHQVLV $OO PDOH
K\EULGVFDQEHREWDLQHGE\FURVVLQJGLIIHUHQWWLODSLDVSHFLHVEXWWKHLUXVHRQDODUJHVFDOHKDV
QRW EHHQ HQWLUHO\ VXFFHVVIXO DV IHPDOHV UHDSSHDU LQ ODWHU SURJHQLHV EHFDXVH RI EURRGVWRFN
LQILOWUDWLRQ E\ K\EULGV 7KXV WLODSLD K\EULGL]DWLRQ KDV EHHQ ODUJHO\ UHSODFHG E\ GLUHFW
KRUPRQDO PDVFXOLQL]DWLRQ 7KH XVH RI DQGURJHQHWLF << PDOHV WR SURGXFH DOO RU QHDUO\ DOO
PDOH ;<  SURJHQ\ LQ FURVVHV ZLWK QRUPDO ;; IHPDOHV KDV EHHQ DOVR SURSRVHG DV D YDOLG
DOWHUQDWLYHLQWKH1LOHWLODSLD

1RYHOW\FRQVLVWVLQWKHDSSHDUDQFHLQWKHK\EULGRIDSRVLWLYHWUDLWWKDWZDVQRWSUHVHQW
LQWKHSDUHQWDOVSHFLHV$Q H[DPSOHLV SURYLGHGE\ WKH DSSHDOLQJPDUEOHGFRORXUSDWWHUQRI
WKHVRFDOOHG³WLJHU´WURXWWKHK\EULGRIWKHFURVVEHWZHHQIHPDOHEURZQWURXW 6DOPRWUXWWD 
; PDOHEURRNWURXW 6DOYHOLQXV IRQWLQDOLV  WKDWZDVVXSHULRULQFXOWXUH WR LWV UHFLSURFDODQG
WULSORLG YDULDQWV OQWHUVSHFLILF DQG LQWHUJHQHULF K\EULGL]DWLRQ LQ PDULQH ILVK FXOWXUH
+\EULGL]DWLRQ H[SHULPHQWV LQ PDULQH WHOHRVWV DUH VWLOO OLPLWHG LQ QXPEHU DV FRPSDUHG WR
IUHVKZDWHU VSHFLHV EXW LQGLFDWH WKDW HVSHFLDOO\ LQ WKH IDPLO\¶V 0RURQLGDH DQG 6SDULGDH
K\EULGVPD\KDYHDFRQVLGHUDEOHSRWHQWLDOIRUFRUQPHUFLDOFXOWXUH

*HQHWLFHQJLQHHULQJ


ϯϲϴ

 )ROORZLQJ WKH SLRQHHULQJ H[SHULPHQW FRQFHUQLQJ WKH WUDQVIHU RI D JURZWK KRUPRQH
*+ HQFRGLQJ JHQHWLF FRQVWUXFW LQWR WKH IHUWLOL]HG HJJV RI WKH JROGILVK WR HQKDQFH ERG\
JURZWKDYDVWERG\RIOLWHUDWXUHKDVDFFXPXODWHGRQWKHWRSLFRIWUDQVJHQHVLVLQWHOHRVWILVK
,QEURDGWHUPVJHQHWUDQVIHULQILVKLVH[SORLWHGLQERWKEDVLFDQGDSSOLHGUHVHDUFK

)LVKWUDQVJHQHVLVLQEDVLFUHVHDUFK

,Q IXQGDPHQWDO VFLHQFH JHQH WUDQVIHU LQ ILVK LV D YDOXDEOH WRRO LQ WKH VWXG\ RI WKH
UHJXODWLRQ RI JHQH H[SUHVVLRQ SDUWLFXODUO\ LQ WKH DUHDV RI GHYHORSPHQWDO ELRORJ\ DQG
HYROXWLRQRIIXQFWLRQDOJHQRPLFVDQGUHOLHVFKLHIO\RQWZRDTXDULXPILVKHVDVH[SHULPHQWDO
PRGHOVQDPHO\WKH]HEUDILVKDQGWKHPHGDND

7KH PDLQDGYDQWDJHV RIWKHVHILVK DQG RWKHUVLPLODU PRGHO ILVKHV VXFK DV SODW\ ILVK
DQGVZRUGWDLOV IRUJHQHWUDQVIHUDVFRPSDUHGWRPDPPDOLDQV\VWHPVOLNHWUDQVJHQLFPLFH
DUH L WKHODUJHDQGFRQWLQXRXVDYDLODELOLW\RIJDPHWHVDQGHPEU\RVIRUGLUHFWPDQLSXODWLRQ
DWDORZFRVW LL WKHUHODWLYHUDSLGLW\RIHPEU\RQLFGHYHORSPHQWDQG LLL WKHWUDQVSDUHQF\RI
HPEU\RV SUHODUYDH DQG ODUYDH XS WR WKH SLJPHQWDWLRQ VWDJH  IRU GLUHFW ORFDOL]DWLRQ RI
UHSRUWHUJHQH WUDQVFULSWLRQ 7KHVHIHDWXUHV PDNHWKHVHILVKYHU\ KDQG\HVSHFLDOO\IRLQUYLYR
WUDQVLHQWJHQHH[SUHVVLRQDVVD\V

&RQYHUVHO\ WKHUH DUH DOVR VRPH GLVDGYDQWDJHV ZLWK SLVFLQHV\VWHPVWKDWVWLOOQHHG EH
RYHUFRPHEHFDXVHWKH\ORZHUFRQVLGHUDEO\WKHWUDQVJHQHLQWHJUDWLRQHIILFLHQF\DQGKLQGHUWKH
SURGXFWLRQRIVWDEOHWUDQVJHQLFOLQHVDQGWUDQVJHQHWDUJHWLQJZLWKLQWKHUHFLSLHQWJHQRPH7KH
ILUVWREVWDFOHLVWKH\RONFRQWHQWRIIHUWLOL]HGHJJVWKDWSUHYHQWVSURQXFOHDUPLFURLQMHFWLRQDV
LWLVURXWLQHO\GRQHLQWKHPRXVH+HQFHWUDQVJHQHV PXVW EH LQWURGXFHGLQWRWKH RRSODVPLF
FRPSDUWPHQWRISRVWRYXODWRU\RRF\WHVDQGIHUWLOL]HGHJJVRULQWRWKHEODVWRPHULFF\WRSODVP
RI HDUO\ VHJPHQWLQJ HPEU\RV XVLQJ D YDULHW\ RI WHFKQLTXHV PLFURLQMHFWLRQ WKURXJK WKH
FKRULRQ RU PLFURS\OH HOHFWURSRUDWLRQ SDUWLFOH JXQ ERPEDUGPHQW DQG WUDQVIHFWLRQ ZLWK
OLSRVRPHV  7KLV DSSURDFK UHTXLUHV WKH XVH RI D PXFK KLJKHU QXPEHU RI WUDQVJHQH FRSLHV
 FRSLHVFHOO LQVWHDG RI  FRSLHVSURQXFOHXV DV LQ WKH PRXVH  WR IDYRXU QXFOHDU
LQFRUSRUDWLRQDQGFKURPRVRPDOLQWHJUDWLRQ'HVSLWHWKLVFRPSHQVDWLRQWUDQVJHQHLQWHJUDWLRQ
WHQGVWREHUHWDUGHGDQGLWVHIILFLHQF\UDWKHUORZLQILVK

$W SUHVHQW PHGDND LV WKH RQO\ WHOHRVW LQ ZKLFK IRUHLJQ '1$ FDQ EH VXFFHVVIXOO\
LQMHFWHGLQWRWKHSRODUL]HGJHUPLQDOYHVLFOHRISULPDU\RRF\WHVEXWWKLVWHFKQLTXHVLQYROYHV
FRPSOH[ SURFHGXUHV DQG VWLOO UHTXLUHV [ WUDQVJHQH FRSLHV QXFOHXV (IIHFWLYHQHVV RI
JHQH WUDQVIHU PHGLDWHG E\ VSHUP FHOOV VXEMHFWHG WR LQFXEDWLRQ RU HOHFWURSRUDWLRQ ZLWK WKH
H[RJHQRXV '1$ WKRXJK FODLPHG LQ ]HEUDILVK VHHPV WR EH YHU\ ORZ RU QHJOLJLEOH DV
REVHUYHGDOVRLQPDPPDOV

7KH VHFRQG REVWDFOH LV WKH H[WUHPHO\ UDSLG VXFFHVVLRQ RI WKH ILUVW  FOHDYDJHV LQ
ILVKHPEU\RVZLWKRXW*DQG*3SKDVHVDQGYLUWXDOO\QRWUDQVFULSWLRQXSWRWKHPLGEODVWXOD
VWDJH 7KLV IDVW VHJPHQWDWLRQ SUHVXPDEO\ VXSSRUWHG E\ D ODUJH VWRUH RI SURWHLQV DQG
SUHFXUVRUV IRU '1$ UHSOLFDWLRQ DQG FKURPDWLQ DVVHPEO\ WKDW LV QRW DYDLODEOH LQ PDPPDOV
ZKRVHHDUO\GHYHORSPHQWLVPXFKVORZHU

7KLVVWDWHRIDIIDLUVWHQGVWRSURPRWH L UHSOLFDWLRQRILQFRUSRUDWHG'1$PRVWO\LQDQ
H[WUDFKURPRVRPDO VWDWH ZLWK DQ RYHUDOO LQFUHDVHLQ WKH QXPEHU RI FRSLHV QXFOHXV L 
FRQFDWHPHUL]DWLRQ LHIRUPDWLRQRIWDQGHPDUUD\V RILQFRUSRUDWHGDQGUHSOLFDWHGH[RJHQRXV
'1$VHTXHQFHVFDUULHGRXWE\VWRUHGOLJDVHVZKRVHDFWLYLW\LVOLNHO\VWLPXODWHGE\WKHLUKLJK

ϯϲϵ

FRQFHQWUDWLRQV LLL  PRVDLFLVP RI H[SUHVVLRQ DQG FKURPRVRPDO LQWHJUDWLRQ LI DQ\ RI HDFK
VLQJOH WUDQVJHQH ZLWKLQ WKH HPEU\R DV D UHVXOW RI XQHTXDO LQLWLDO QXFOHDU LQFRUSRUDWLRQ DQG
GLIIHUHQWLDO UHSOLFDWLRQ GHJUDGDWLRQ RU VXEVHTXHQW IDWH RI WUDQVJHQH FRSLHV LY  WUDQVJHQH
VLOHQFLQJE\'1$PHWK\ODWLRQDQGKHWHURFKURPDWLQIRUPDWLRQWKDWVHHPVWREHPRUHLQWHQVH
ZKHQ LQWHJUDWLRQ RFFXUV DV PXOWLSOHFRS\ FRQFDWDPHUV DQG LV SUREDEO\ UHVSRQVLEOH IRU WKH
IDGLQJDZD\RIWUDQVJHQHH[SUHVVLRQLQVXFFHVVLYHILVKJHQHUDWLRQV

7KHVHGUDZEDFNVSUHYHQWWKHQRQPRVDLFLQWHJUDWLRQRIWKHWUDQVJHQHDVDVLQJOHLQWDFW
FRS\ DV RSSRVHG WR FRQFDWDPHUV 0RUHRYHU WKH\ KLQGHU WKH DSSOLFDWLRQ RI WZRVWHS
WUDQVIHFWLRQWHFKQLTXHVVXFKDVWKHXVHRIFXOWXUHGSOXULSRWHQWHPEU\RQDOVWHP (6 FHOOVDV
IRUHLJQ '1$YHFWRUV LQPLFH WR SHUIRUP WUDQVJHQHWDUJHWLQJ OLNH JHQH NQRFNRXWDQG JHQH
UHSODFHPHQWWKURXJKKRPRORJRXVJHQHUHFRPELQDWLRQ$OWKRXJK(6FHOOOLQHVFDQEHGHULYHG
IURPEODVWXODVWDJHHPEU\RVRI]HEUDILVKDQGJURZQLQFXOWXUHZKHUHWKH\FDQEHWUDQVIHFWHG
DQG VHOHFWHGIRUWKHGHVLUHGFRS\QXPEHUH[SUHVVLRQOHYHODQGJHQRPLF ORFDOL]DWLRQ RI WKH
WUDQVJHQH WKHLU WUDQVSODQWDWLRQ LQWR SUHPLGEODVWXOD VWDJH ILVK HPEU\RV WR JLYH ULVH WR
FKLPHULFWUDQVJHQLFVRPDWLFWLVVXHVDQGJHUPOLQHLVQRWDVVWUDLJKWIRUZDUGDVLQPLFH,QIDFW
WKH SUROLIHUDWLRQ UDWH RI WUDQVSODQWHG (6 FHOOV LV PXFK VORZHU WKDQ WKDW RI WKH FHOOV LQ WKH
UHFLSLHQW HPEU\R SUREDEO\ EHFDXVH WKH\ DUH QRW HQGRZHG ZLWK WKH VDPH DIRUH PHQWLRQHG
UHSOLFDWLYHPDFKLQHU\DQGWKHLUFRPSHWLWLRQWRFRQWULEXWHWRWKHWRWDOFHOOVRIWKHHPEU\RLV
FRQVHTXHQWO\FXUWDLOHG6LQFHODWHURQRQO\DVPDOOQXPEHU RIJDPHWHVZLOOEHWUDQVJHQLFLI
DQ\WKHSURGXFWLRQDQGLGHQWLILFDWLRQRIWUDQVJHQLFSURJHQ\EHFRPHVFXPEHUVRPH

$OWHUQDWLYHDSSURDFKHVDUHZRUWKH[SORULQJWRLPSURYHWKHFRQWURORQJHQHWUDQVIHULQ
ILVK WR D OHYHO FRPSDUDEOH WR WKH PXFK PRUH VXFFHVVIXO UHVHDUFK ZLWK WUDQVJHQLF PLFH $
SURPLVLQJ DYHQXH ZRXOG EH WKH WUDQVSODQWDWLRQ RI VLQJOH GHFRQGHQVHG VSHUP QXFOHL
WUDQVIHFWHG E\ UHVWULFWLRQ HQ]\PHPHGLDWHG LQWHJUDWLRQ RI WKH WUDQVJHQH LQWR XQIHUWLOL]HG
HJJV 7KLV WHFKQLTXH KDV EHHQ IUXLWIXOO\ DSSOLHG LQ ;HQRSXV ODHYLV WR SURGXFH HPEU\RV
H[SUHVVLQJWKHWUDQVJHQHLQWHJUDWHGLQDIHZFRS\QXPEHU DVVLQJOHFRS\RUVKRUW FRS\ 
FRQFDWDPHUV  QRQPRVDLFDOO\ DQG ZLWK JRRG WLVVXHVSHFLILFLW\ RU UHJLRQDO UHVWULFWLRQ 7KLV
PHWKRG\LHOGVDWUDQVJHQLFSURJHQ\ZLWKWKHWUDQVJHQHLQWHJUDWHGLQDKHPL]\JRXVFRQGLWLRQ
DWGLIIHUHQWJHQRPLFVLWHVWKDWFDQEHXSJUDGHGWRDKRPR]\JRXVFRQGLWLRQDWOHDVWDWDVLQJOH
LQWHJUDWLRQ VLWH LQ SDUW RI WKH VXEVHTXHQW RIIVSULQJ REWDLQHG E\ QRUPDO UHSURGXFWLRQ 7KLV
SURFHVV FDQ EH VSHHGHG XS E\ UHVRUWLQJ WR UHSURGXFWLRQ E\ PLWRJ\QRJHQHVLV RU GLSORLG
DQGURJHQHVLVLQVWHDG RIELSDUHQWDO EUHHGLQJ VR WR JHQHUDWH DW RQFH FRPSOHWHO\ KRPR]\JRXV
WUDQVJHQLF DQLPDOV VHUYLQJ DV SURJHQLWRUV RI FORQDO VWDELOL]HG WUDQVJHQLF OLQHV $ IXUWKHU
FRQFHLYDEOHH[WHQVLRQRIWKHQXFOHDUWUDQVSODQWDWLRQWHFKQRORJ\ZRXOGEHWKHPLFURLQMHFWLRQ
RIVLQJOHQXFOHLIURPLQYLWURWUDQVIHFWHGDQGVHOHFWHG(6FHOOLQWRJHQHWLFDOO\LQDFWLYDWHGHJJV
WR SURGXFH QRQFKLPHULF WUDQVJHQLF ILVK EHDULQJ WDUJHWHG WUDQVJHQHV +RPR]\JRVLW\R I
WUDQVJHQHV FRXOG WKHQE H DFKLHYHG ODWHU RQ E\ XQLVH[XDO RU ELVH[XDO UHSURGXFWLRQ 7KHVH
GHYHORSPHQWV LI LPSOHPHQWHG ZRXOG HOLPLQDWH WKH SUHVHQW VKRUWFRPLQJV RI (6 FHOO
WHFKQRORJ\LQILVKDQGPHUJH HYHQWXDOO\LQWR DWHFKQRORJ\ IRUWKHWUDQVIHURIQXFOHLIURPD
YDULHW\ RI VRPDWLF FHOO W\SHV VWDEO\ WUDQVIHFWHG LQ FXOWXUH 7KH ODWWHU DSSURDFK ZDV XVHG WR
SURGXFH WUDQVJHQLF VKHHS EHFDXVH LQ WKLV VSHFLHV (6 FHOOV FDSDEOH RI FRQWULEXWLQJ WR WKH
JHUPOLQHKDYHQRW\HWEHHQLVRODWHG

*HQHWUDQVIHUWRLPSURYHSURGXFWLRQLQILVKFXOWXUH

7UDQVJHQHVLV DLPHG WR EHQHILW ILVK FXOWXUH KDV EHHQ PDLQO\ SHUIRUPHG LQ IUHVKZDWHU
VSDZQLQJ WHOHRVWV WKDW LV F\SULQLGV VDOPRQLGV FLFKOLGV HVRFLGV DQG LFWDOXULGV FI DERYH
UHYLHZV 0RVWH[SHULPHQWVKDYHFRQFHQWUDWHGRQJURZWKHQKDQFHPHQWE\PLFURLQMHFWLRQRI

ϯϳϬ

*+HQFRGLQJ JHQHWLF FRQVWUXFWV LQWR IHUWLOL]HG HJJV EXW UHVHDUFK KDV DOVR EHHQ GLUHFWHG
WRZDUGVLQFUHDVLQJWKHIUHH]HUHVLVWDQFHRI$WODQWLFVDOPRQDQGFROGWROHUDQFHRIJROGVILVKDV
ZHOODVWRGHYHORSDWUDQVJHQLFDSSURDFKWRFRQIHUGLVHDVHUHVLVWDQFH

,QDGGLWLRQWRWKHGLIILFXOWLHVDQGSUREOHPVGLVFXVVHGDERYHUHJDUGLQJJHQHWUDQVIHULQ
ILVKLQ JHQHUDOWKUHHRWKHULVVXHV QHHGEHFRQVLGHUHG ZKHQ GHDOLQJ ZLWKWUDQVJHQLFILVKIRU
PDVVLYH FXOWXUH QDPHO\ HQYLURQPHQWDO VDIHW\ HFRQRPLF FRQYHQLHQFH DQG FRQVXPHU
DFFHSWDQFH

(QYLURQPHQWDOVDIHW\

7KHSUREOHPRIVDIHW\KDVEHHQUHSHDWHGO\UDLVHGDQGFDQEHEHVWRYHUFRPHE\UHDULQJD
OLPLWHGQXPEHURIWUDQVJHQLFEURRGILVKLQFORVHGV\VWHPVZLWKUHFLUFXODWLQJZDWHUWRHQVXUH
FRPSOHWH SK\VLFDO FRQILQHPHQW DQG E\ JURZLQJ IRU IDWWHQLQJ RQO\ WRWDOO\ VWHULOH ILVK
SURGXFHG E\ LQWHUVSHFLILF K\EULGL]DWLRQ WULSORLG\ LQGXFWLRQ JHQHWLF VWHULOLW\ LQGXFHG E\
KRPR]\JRXV UHFHVVLYH DOOHOHV H[SUHVVLRQ RI D *Q5+ DQWLP51$ GULYHQ E\ D *Q5+ JHQH
SURPRWHURURWKHUHTXLYDOHQWPHDQV5LVNDVVHVVPHQWVWXGLHVEDVHGRQWKHRUHWLFDOLQIHUHQFH
RU HYHQ SLORW UHOHDVH WULDOV WR ILJXUH RXW WKH SRVVLEOH XQGHVLUDEOH HQYLURQPHQWDO LPSDFWV RI
IHUWLOHWUDQVJHQLFILVKVHWORRVHLQWRWKHZLOGKDYHXQFHUWDLQSUHGLFWLYHYDOXHDQGDSSOLFDELOLW\
DQGPD\DFWXDOO\FDXVHGLVSHUVDORIWUDQVJHQLFILVK

1HYHUWKHOHVV D VWURQJ VWDQG DJDLQVW WKH DVVXPSWLRQ WKDW WKH UHOHDVH RI JHQHWLFDOO\
PRGLILHGILVKLQFOXGLQJZDUPZDWHUPDULQHILVKOLNHWKHJLOWKHDGVHDEUHDPWKDWKDYHDJUHDW
SRWHQWLDOIRUGLVSHUVDODORZSUREDELOLW\IRUUHFDSWXUHDQGDUHDVRQDEOHFKDQFHWRVXUYLYHDQG
UHSURGXFHLQWKHZLOGPD\LQDQ\ZD\UHSUHVHQWDQLPSODQW RIVXSHULRUYDULDQWVFDSDEOHRI
JHQHWLFDPSOLILFDWLRQDWWKHH[SHQVHRIIHUDOFRQVSHFLILFVDQGRWKHUDTXDWLFSRSXODWLRQV2Q
WKH RSSRVLWH EDVHG RQ WKH SUHYLRXV HFRORJLFDOO\ ULVNIUHH UHFRUG RI JHQHWLFDOO\ HQJLQHHUHG
GRPHVWLF SODQWV DQG WHUUHVWULDO DQLPDOV KH FRQWHQGV WKH K\SRWKHVLV WKDW ODERUDWRU\LQGXFHG
JHQHWLF FKDQJHV KDYH D QHJOLJLEOH SUREDELOLW\ RI EHLQJ VHOHFWLYHO\ IDYRXUHG LQ ZLOG
SRSXODWLRQV XQGHU QDWXUDO VHOHFWLRQ DQG DFFRUGLQJO\ ZLWKRXW VXVWDLQHGODUJH UHOHDVHV KDYH
OLWWOH SRWHQWLDO IRU HFRORJLFDO LPSDFW 7KH FUXFLDO DUJXPHQW LV WKDW ZLWKRXW VXEVWDQWLDO
NQRZOHGJH RI WKH FRPSOH[LWLHV LQ JHQRPLF DUFKLWHFWXUH DQG JHQH LQWHUSOD\ UHTXLUHG IRU
SKHQRW\SLFDGDSWDWLRQWRWKHHQYLURQPHQWDQ\HQJLQHHUHGJHQHWLFFKDQJHLVIDWHGWRH[DOWD
SHFXOLDU WUDLW DW WKH GHWULPHQW RI RYHUDOO ILWQHVV LQ WKH ZLOG LQ D VLPLODU ZD\ DV FODVVLFDO
UDQGRPPXWDWLRQV

7KLV UHDVRQLQJ LV ZHOO VXEVWDQWLDWHG E\ H[LVWLQJ HYLGHQFH DQG PD\ EH HQGRUVHG WR
UHPRYHH[FHVVLYHFRQFHUQDERXWFRQWUROOHGUHVHDUFKRQJHQHWUDQVIHULQILVKDQGWKHVHWWLQJ
XSRIWUDQVJHQLFEURRGVWRFNVRIDOLPLWHGVL]HXQGHUSK\VLFDOFRQILQHPHQW7KLVSROLF\ZRXOG
EH DQDORJRXV WR WKH RIILFLDO JXLGHOLQHV IRU JHQH WUDQVIHU LQ WKH PRXVH D FRVPRSROLWDQ SHVW
VSHFLHVZLWK WKRXVDQGVRIWUDQVJHQLFVDOUHDG\SURGXFHG QRQH RI ZKLFK KDV FRQVROLGDWHGL Q
WKHZLOG

&RQYHUVHO\UHOLDQFHRQDSUHFDXWLRQDU\DWWLWXGHWRZDUGVWKHPDVVFXOWLYDWLRQQHDURUDW
WKHVHDRIQRQVWHULOHWUDQVJHQLFPDULQHILVKLVOLNHO\WRSUHYDLODWSUHVHQWMXVWLILHGE\ODFNRI
SHUWLQHQW GDWD DQG RXU VFDUFH FRQWURO RYHU WKH PDULQH HQYLURQPHQW 5HVWULFWLYH UHJXODWLRQV
ZLOO WKHQ FRQWLQXH WR EH HQIRUFHG XQOHVV RQH RI WKH IROORZLQJ FRQGLWLRQV DUH PHW L 
FRQFOXVLYH SURRI WKDW QRQVWHULOH WUDQVJHQLF ILVK FDQQRW SURSDJDWH LQ WKH ZLOG LL 
GHPRQVWUDWLRQRIWKHFRPSOHWHDQGSHUPDQHQWVWHULOLW\RIWUDQVJHQLFILVKIRURQJURZLQJRU
LLL IDWWHQLQJRIPDULQHWUDQVJHQLFILVKLQIDUPVRSHUDWLQJ ZLWK UHFLUFXODWLQJ V\VWHPVLQ WKH

ϯϳϭ

KLQWHUODQG DZD\ IURP WKH VHD LQ WKH FDVH WKDW WKH SUHYLRXV WZR FRQGLWLRQV KDYH QRW EHHQ
FRQYLQFLQJO\IXOILOOHG

(FRQRPLFFRQYHQLHQFH

$V WR HFRQRPLF FRQYHQLHQFH WKH TXHVWLRQ RI ZKHWKHU LW PLJKW EH SURILWDEOH IRU WKH
SURGXFHUVLQWKH0HGLWHUUDQHDQUHJLRQWRLQYHVWLQWUDQVJHQLFWHFKQRORJ\FDQEHDQVZHUHGDW
WKLV WLPH RQO\ LQ JHQHUDO WHUPV RZLQJ WR WKH IDFW WKDW LQWHUHVW LQ WKLV RSSRUWXQLW\ LV PHUHO\
LQFLSLHQW <HW D QXPEHU RI SRVVLEOH DGYDQWDJHV FDQ EH HDVLO\ SXW RQ D OLVW VXFK DV L 
LPSURYHPHQW RI GLVHDVHUHVLVWDQFH LQ WUDQVJHQLFV ZRXOG EH D YDOXDEOH WUDLWFRQVLGHULQJ WKH
HFRQRPLF ORVVHV FDXVHG E\ UHFXUUHQW HSL]RRWLFV LQ PDULQH ILVK FXOWXUH LL  HQKDQFHPHQW RI
JURZWK DW WKH ODUYDO DQG SHULPHWDPRUSKLF VWDJHV PD\ UHGXFH WKH FRQVLGHUDEOH FRVWV RI WKH
FXUUHQW UHDULQJ WHFKQRORJ\ EDVHG RQ WKH SURORQJHG DGPLQLVWUDWLRQ RI OLYLQJ SUH\V E\
DQWLFLSDWLQJ WKH WLPH RIZHDQLQJ ZLWK DQ LQHUW GLHW LLL  DPSOLILFDWLRQ RIDQDEROLVP LQ IDVW
JURZLQJ WUDQVJHQLFV PD\ DPHOLRUDWH WKH FRQYHUVLRQ HIILFLHQF\ RI KLJK HQHUJ\ IHHG OLNH
H[WUXGHG SHOOHWV ZLWK D KLJK OLSLG FRQWHQW LQWR D OHDQ ILOHW PHDW WKXV UHGXFLQJ XQZDQWHG
DFFXPXODWLRQRILQWUDPXVFXODUDQGSHULYLVFHUDOIDWDQLQFUHDVHLQIRRGFRQYHUVLRQHIILFLHQF\
XS WR   E\ DGPLQLVWHUHG UHFRPELQDQWILVK*+V KDV EHHQ UHSHDWHGO\ UHSRUWHG LY  IDVW
JURZLQJWUDQVJHQLFVDUHEHVWVXLWHGIRUFXOWXUHLQUHFLUFXODWLQJV\VWHPVZKHUHWKHEHQHILWVRI
RSWLPL]HGFXOWXUHFRQGLWLRQVSURWHFWLRQIURPSDWKRJHQVDQGQHJOLJLEOHSROOXWLQJGLVFKDUJHV
DUHFRXQWHUDFWHGE\KLJKUXQQLQJFRVWVWKDWFDQEHVXVWDLQHGRQO\LIWKHSURGXFWLRQF\FOHLV
FRQVLGHUDEO\ VKRUWHQHG Y  JHQHWLF HQJLQHHULQJ RI FXOWXUHG FDUQLYRURXV VSHFLHV WR FRQIHU
DGGLWLRQDO GLJHVWLYH DQG PHWDEROLFDSDELOLWLHV HXU\SKDJ\  PD\ DOORZ IHHGLQJ RQ OHVV
H[SHQVLYHQXWULHQWVVXFKDVFDUERK\GUDWHVRUYHJHWDEOHRLOVWKXVSDUWLDOO\ UHSODFLQJDQLPDO
SURWHLQ DQG ILVK RLO LQ WKH GLHW YL  WKH RZQHUVKLS RI D WUDQVJHQLF EURRGVWRFN LV OLNHO\ WR
DIIRUGDFRQWURORYHUDVKDUHRIWKHILVKPDUNHWWKDWLVH[SHFWHGWRJURZODUJHUDQGODUJHUWKH
ORZHUWKHSULFHRI WKHPDUNHWHG WUDQVJHQLF ILVKDQG YLL  H[SHUWLVHJDLQHGLQWKHWUDQVJHQLF
FXOWXUH RI 0HGLWHUUDQHDQ ILVK VSHFLHV PD\ EH SXW WR XVH LQ FRRSHUDWLYH SURJUDPV ZLWK
GHYHORSLQJ FRXQWULHV FHQWUHG RQ RWKHU VSHFLHV VXFK DV F\SULQLGV DQG FLFKOLGV WKDW DUH
LPSRUWDQWIRUDPXOWLWXGHRIFRQVXPHUVZLWKDOLPLWHGVXSSO\RIDQLPDOSURWHLQ
&RQVXPHUDFFHSWDQFH

:LWK UHJDUG WR FRQVXPHU DFFHSWDQFH WKLV LV OLNHO\ WR HYROYH WRJHWKHU ZLWK WKH SXEOLF
SHUFHSWLRQ RI JHQHWLFDOO\ PRGLILHG RUJDQLVPV DV D UHVXOW RI WKH FRPELQHG FRQIOLFWLQJ
LQIOXHQFH RI WUDGLWLRQDO YDOXHV HWKLFDO LVVXHV LGHRORJLFDO SRVLWLRQV SROLWLFDO PRRG PDVV
PHGLD RULHQWDWLRQ LQ LQIRUPDWLRQ SURFHVVLQJ DQG VFLHQFH SRSXODUL]DWLRQ DQG RWKHU
XQSUHGLFWDEOHYDULDEOHV%HFDXVHWKHUHLVQRQHHGIRUDWUDQVJHQLFWHFKQRORJ\LQPDULQHILVK
FXOWXUH XQOHVV LW FDQ VXSSO\ D SURGXFW RI VXSHULRU TXDOLW\ DW D ORZHU SULFH D WUDQVLWLRQ LQ
FRQVXPHUV¶ DWWLWXGH WRZDUGV WUDQVJHQLF ILVK FDQ WKHQ EH HQYLVLRQHG RQ WKH EDVLV RI VKHHU
FRQYHQLHQFHIURPLQLWLDOUHIXVDOWRWROHUDQFHDQGILQDOO\WRDSSUHFLDWLRQ$VLPLODUWUDMHFWRU\
FDQ EH UHFRJQL]HG LQ WKH FRXUVH RI WKH ODVW WZHQW\ILYH \HDUV ZLWK UHVSHFW WR FXOWXUHG YV
FDSWXUHG VHDEDVV DQG VHDEUHDP :LWK D GURS LQUHWDLO SULFH WR DERXW RQH WKLUG RI ZKDW ZDV
RIIHUHGLQWKHSDVWDQGWKHJHQHUDOJRRGXQLIRUPLW\DQGGHSHQGDEOH TXDOLW\ RIWKHFXOWXUHG
SURGXFWIHZSHRSOHUHDOO\FDUHQRZDGD\VZKHWKHUWKHILVKRQVDOHKDGOLYHGLQDIORDWLQJFDJH
LQVWHDGRIVWUXJJOLQJIRUOLIHRQWKHKLJKVHDV$FWXDOO\ZLWKDGHHSHQLQJSHUFHSWLRQRIWKH
H[LVWHQWLDOYDOXHRIZLOGOLIHLWPD\EHUHDVVXULQJLIQRWFRPIRUWLQJWRNQRZWKDWRQH¶VPHDO
GHPDQGHGWKHVDFULILFHRIDFUHDWXUHERUQIRUWKDWSXUSRVHDQGJURZQZLWKFDUH

+RZHYHU WR EHOLHYH WKDW FRQVXPHUV¶ FKRLFHV DUH PRWLYDWHG H[FOXVLYHO\ E\ D UDWLRQDO
DSSUDLVDORIVKHHUFRQYHQLHQFHLVDQRYHUVLPSOLILFDWLRQDVGLIILGHQFHWRZDUGVQRYHOW\LVRIWHQ

ϯϳϮ

D FULWLFDO EDUULHU WR IRRG SURGXFW DFFHSWDQFH 7KLV PHDQW WKDW WKH PDUNHWLQJ VWUDWHJ\ IRU
JHQHWLFDOO\HQJLQHHUHGILVKPXVWFRQFHQWUDWHQRWRQO\RQDQDSSHDOLQJTXDOLW\SULFHUDWLREXW
DOVRRQJUDGXDOQHVVPRGHUDWLRQDQGIDLUQHVV*UDGXDOQHVVFRQVLVWVLQRIIHULQJWRFRQVXPHUVD
VHULHVRILQWHUPHGLDWHSURGXFWVZLWKLQFUHDVLQJGLYHUJHQFHZLWKUHVSHFWWRFRQVROLGDWHGLWHPV
WRVRIWHQWKHLPSDFWRIQRYHOW\$FRQFHLYDEOHVHTXHQFHPD\EHWULSORLGDQGPRQRVH[XDOILVK
 VWHULOH K\EULGV FXOWXUHG LQ RSHQ RU FORVHG V\VWHPV  GLYHUVLILHG VWHULOH K\EULGV RI
XQLPDWHUQDOSRO\SDWHUQDO RULJLQ  GLVHDVHUHVLVWDQW VWHULOH WUDQVJHQLFV  IDVW JURZLQJ VWHULOH
WUDQVJHQLFVGRXEOHPXVFOHGVWHULOHWUDQVJHQLFV VHHEHORZ HXU\SKDJLFVWHULOHWUDQVJHQLFV
DQGVRRQRIFRXUVHVRPHRIWKHVHQRYHOWUDLWVFRXOGEHHQJLQHHUHGQRWRQO\LQSDUDOOHOEXW
DOVRLQVHULHVDORQJWKHVDPHWUDQVJHQLFOLQH

3UHVXPDEO\ RQO\ D SDUW RI WKH DERYH VHTXHQFH ZRXOG EH UHDOO\ LPSOHPHQWDEOH LQ
0HGLWHUUDQHDQ FXOWXUHG ILVK VSHFLHV ZKRVH PDUNHW YROXPH LV SUREDEO\ QRW ELJ HQRXJK WR
MXVWLI\KXJHUHVHDUFKLQYHVWPHQWVLILWZHUHQRWIRUWKHIDFWWKDWWKHVDPHELRWHFKQRORJ\PD\
EHSURILWDEO\H[WHQGHGWRRWKHUVSHFLHVRILQWHUHVWIRUWKLUGZRUOGFRXQWULHV$QRWKHUSRLQWWR
WDNHLQWRDFFRXQWLVWKDWTXDQWLWDWLYHJHQHWLFVLVDOVREHLQJDSSOLHGWRILVKWRSXUVXHVRPHRI
WKHVDPHJRDOVDVWUDQVJHQHWLFVOLNHGLVHDVHUHVLVWDQFHDQGJURZWKHQKDQFHPHQW$WSUHVHQW
LWFDQQRWEHSUHGLFWHGZKDWDSSURDFKZLOOPHHWZLWKPRUHVXFFHVVZKHWKHUWKHFRQVROLGDWHG
PHWKRGRORJ\ RI TXDQWLWDWLYH JHQHWLFV ZLWK LWV RQHURXV ORJLVWLFV DQG JUDGXDO JDLQV RU WKH
WHFKQRORJLFDO G\QDPLVP RI WUDQVJHQHWLFV ZLWK LWV SUHVHQW H[SHULPHQWDO GLYHUVLILFDWLRQ DQG
VHDUFKIRUVXGGHQEUHDNWURXJKV7KHUHTXLUHPHQWRIPRGHUDWLRQLQFXOWXUHGILVKWUDQVJHQHVLV
UHIHUV WR WKH UHFRPPHQGDWLRQ RI UHIUDLQLQJ IURP WRR UDGLFDO JHQHWLF FKDQJHV LQGXFHG E\
WUDQVJHQHVZLWKDQRYHUO\DUWLILFLDOGHVLJQ6RIDUDOOH[SHULPHQWVKDYHEHHQDLPHGWRZDUGV
WKH GLUHFW SKHQRW\SLF H[SUHVVLRQ RI JHQH FRQVWUXFWV ZKHUHDV WKH SRVVLEOH EHQHILWV RI
NQRFNLQJRXWWKHH[SUHVVLRQRIFRQVWLWXWLYHJHQHVE\KRPRORJRXVUHFRPELQDWLRQKDVQRW\HW
EHHQLQYHVWLJDWHGIRUODFNRIDQDGHTXDWHWHFKQRORJ\DVGLVFXVVHGDERYH,QWKLVUHVSHFWDQ
DWWUDFWLYH WDUJHW PLJKW EH WKH P\RVWDWLQ JHQH LI SUHVHQW LQ ILVK ZKRVH LQDFWLYDWLRQ E\ D
UDQGRPPXWDWLRQDQESGHOHWLRQ±JDYHULVHWRWKHGRXEOHPXVFOHG%HOJLDQ%OXHERYLQH
VWUDLQ0LFHZLWKDGLVUXSWHGP\RVWDWLQJHQHZHUHVLJQLILFDQWO\ODUJHUWKDQZLOGW\SHDQLPDOV
DQG VKRZHG D  WLPHV LQFUHDVHLQ VNHOHWDO PXVFOH PDVV $ WUDQVJHQLF ILVK ZLWK D EHWWHU
SHUIRUPDQFHLQFXOWXUHEHFDXVHLWEHDUVDVXSSUHVVHGJHQHLVOLNHO\WREHPRUHDFFHSWDEOHE\
WKHIRRGPDUNHWDVFRPSDUHGWRDILVKDFWLYHO\H[SUHVVLQJDWUDQVJHQH

0RVWUHVHDUFKRQJHQHWUDQVIHUWRLPSURYHJURZWKLQIDUPHGILVKLVQRZFRQGXFWHGZLWK
WUDQVJHQHV FRQWDLQLQJ H[FOXVLYHO\ ILVKGHULYHG VHTXHQFHV ³DOOILVK´ FRQVWUXFWV  LQ SODFH RI
WKH PDPPDOLDQ DYLDQ DQG YLUDO UHJXODWRU\ DQG FRGLQJ VHTXHQFHV XVHG LQ HDUO\ ZRUN 7KLV
SRVLWLYHWUHQGWRZDUGVDJUHDWHUKRPRORJ\EHWZHHQWKH WUDQVJHQHDQG WKHUHFLSLHQW JHQRPH
KDVQRW\HWSURJUHVVHGIXUWKHULQWRWKHVHOHFWLRQRIPRUHILQHO\WXQHGSURPRWHUVWRGULYHWKH
H[SUHVVLRQ RI FRPSOHPHQWDU\ RU JHQRPLF KRUPRQHHQFRGLQJ '1$V ,Q IDFW WKH SXUVXLW RI
KLJK H[SUHVVLRQ OHYHOV RI *+ KDV SURPSWHG WKH XVH RI FKLPHULF FRQVWUXFWV FRQWDLQLQJ
UHJXODWRU\ VHTXHQFHV ZLWK HLWKHU D ZLGHVSUHDG WLVVXH[SUHVVLRQ VXFK DV WKH VDOPRQLG
PHWDOORWKLRQHLQJHQHSURPRWHUVDQGWKHFDUS‰DFWLQJHQHSURPRWHURUZLWKDWLVVXHVSHFLILF
H[SUHVVLRQ RI KLJK LQWHQVLW\ VXFK DV WKH KHSDWRWURSLF RFHDQSRXW DQWLIUHH]H SURWHLQ JHQH
SURPRWHUV 8QIRUWXQDWHO\ WKH RYHUH[SUHVVLRQ RI *+ LV QRW DOZD\V FRUUHODWHG ZLWK D EHWWHU
JURZWK

2QFRUK\QFKXVNLVXWFKEHDULQJDFRQVWUXFWFRQVLVWLQJRIWKHVRFNH\HVDOPRQ*+JHQHI
XVHG WR WKH VRFNH\H VDOPRQ PHWDOORWKLRQHLQ% SURPRWHU ZHUH RQ DYHUDJH IROG KHDYLHU
DQGVRPHLQGLYLGXDOV XS WR IROG KHDYLHU  WKDQ QRQWUDQVJHQLFFRQWUROVDW PRQWKVRI
DJHDQGKDG*+SODVPDOHYHOVXSWRIROGKLJKHUGXHWRDQXQFRQWUROOHGRYHUH[SUHVVLRQRI

ϯϳϯ

WKHWUDQVJHQH7KHVHILVKZHUHDIIHFWHGE\YDULRXVDEQRUPDOLWLHVVXFKDVDFURPHJDO\FUDQLR
IDFLDO GHIRUPLWLHV DQG RSHUFXODU RYHUJURZWK DQG VKRZHG UHGXFHG YLDELOLW\ 5HFHQWO\
WUDQVJHQLF 1LOH WLODSLDV FDUU\LQJ D FKLQRRN VDOPRQ *+ JHQH GULYHQ E\ DQ RFHDQ SRXW
DQWLIUHH]HSURWHLQSURPRWHUZHUHFKDUDFWHUL]HGE\DKLJKOHYHORIH[RJHQRXV*+H[SUHVVLRQ
DQG D WLPHV JUHDWHU JURZWK UDWH WKDQWKHLU QRQWUDQVJHQLFIXOO VLEOLQJV 7UDQVJHQLF PDOHV
KRZHYHU ZHUH VXEIHUWLOH RU FRPSOHWHO\ VWHULOH 7KHVH DQG VLPLODU UHVXOWV VXJJHVW WKDW D
FRQYHQLHQW DOWHUQDWLYH PLJKW EH WKH WUDQVIHU RI *+ JHQH FRQVWUXFWV GULYHQ E\ WKHLU RZQ
UHJXODWRU\VHTXHQFHVWRWDUJHWH[SUHVVLRQWRWKHSLWXLWDU\EHFDXVHWKHLQFUHDVHRI*+OHYHOV
LQWKHUHVXOWLQJWUDQVJHQLFVZRXOGEHPRUHSK\VLRORJLFDOO\FRQWUROODEOH2GGO\HQRXJKJHQH
WUDQVIHUH[SHULPHQWVRIWKLVNLQGKDYHQHYHUEHHQSHUIRUPHGVRIDULQIDUPHGILVKSUREDEO\
IRUWKHIHDUWKDWLQWHUQDOQHJDWLYHIHHGEDFNPHFKDQLVPVPLJKWGHSUHVVWKHH[SUHVVLRQRIWKH
WUDQVJHQH&RQVHTXHQWO\EDVLFUHVHDUFKRQWKHWUDQVFULSWLRQDOFRQWURORIWKH*+JHQHLQILVK
KDVQRWFRQWULEXWHGDWDOOWRWUDQVJHQHVLVDSSOLHGIRUJURZWKHQKDQFHPHQWLQILVKFXOWXUH

,QYHVWLJDWLRQRQWKHIXQFWLRQDORUJDQL]DWLRQRIWKHSURPRWHUUHJLRQRIWKH*+JHQHRI
UDLQERZWURXW UW*+ DVFRPSDUHGWRWKRVHRIPDPPDOVKDVUHYHDOHGWKDWWKHFLVDQGWDQV
UHJXODWRU\ HOHPHQWV JRYHUQLQJ *+ H[SUHVVLRQ DUH KLJKO\ FRQVHUYHG LQ YHUWHEUDWHV DQG WKDW
WKH\HYROYHGHVVHQWLDOO\FRPELQDWRULDOO\ LHE\GLIIHUHQWDVVRUWPHQWVDQGSRVLWLRQLQJRIWKH
VDPHUHJXODWRU\XQLWVZLWKLQWKHYDULRXVSURPRWHUV UDWKHUWKDQPROHFXODUO\ LHWKURXJKWKH
GHYHORSPHQW RI QRYHO UHJXODWRU\ XQLWV  DFFRUGLQJ WR WKH FRQWLQJHQW DGDSWLYH QHHGV RI HDFK
VSHFLHV$QRWKHULQWHUHVWLQJDVSHFWLVWKDWWKHSUR[LPDOSURPRWHUUHJLRQRIUW*+VWUHWFKLQJ
DFURVV DERXW  ES ¶ XSVWUHDP RI WKH WUDQVFULSWLRQ VWDUW LV VXIILFLHQW WR FRQIHU D VWURQJ
WLVVXHVSHFLILF H[SUHVVLRQ WR D UHSRUWHU JHQH LQ WUDQVIHFWLRQ DVVD\V ,Q IDFW WKLV UHJLRQ
FRQWDLQVELQGLQJVLWHV ),) IRUWKHFRQVHUYHGSLWXLWDU\UHVWULFWHGWUDQVFULSWLRQIDFWRU3LW
OZKLFKLVUHTXLUHGIRUWKHH[SUHVVLRQLQVRPDWRWURSLFFHOOV

0RUHRYHU WKH UHJLRQ HQFRPSDVVLQJ WKH ) DQG ) 3LWOELQGLQJ VLWHV LQFOXGHV WZR
DGGLWLRQDO UHJXODWRU\ HOHPHQWV D 7*$&* PRWLI FRUUHVSRQGLQJ WR &5( &$03 UHVSRQVH
HOHPHQW  WKDW VWLPXODWHV WUDQVFULSWLRQ XSRQ LQWHUDFWLRQ ZLWKWKH WUDQVIDFWRU &5(%3 &5(
ELQGLQJ SURWHLQ  RQFH SKRVSKRU\ODWHG E\ SURWHLQ NLQDVH$  DQG D *5( OLNH JOXFRFRUWLFRLG
UHVSRQVH HOHPHQW  PRWLI WKDW DFWLYDWHV WUDQVFULSWLRQ DIWHU ELQGLQJ ZLWK WKH VDWXUDWHG
FRUWLFRVWHURLGUHFHSWRU7KHVHWZRHOHPHQWVFRQIHUDV\QHUJLVWLFUHVSRQVLYHQHVVWR&$03DQG
FRUWLVRORQWKHUW*+SURPRWHU,QWHUHVWLQJO\WKHSURPRWHUUHJLRQORFDWHGXSVWUHDPRIWKH)
VLWHLVDSSDUHQWO\LQKLELWRU\HYHQWKRXJKLWFDUULHVDQDGGLWLRQDO3LWOELQGLQJVLWH ) 

7KHVH GDWD VXJJHVW WKDW WKH SUR[LPDO SURPRWHU LV HVVHQWLDOO\ LQYROYHG LQ WUDQVFULSWLRQ
DFWLYDWLRQZKHUHDVRWKHUUHJXODWRU\HOHPHQWVZLWKHLWKHUHQKDQFHURUVLOHQFHUIXQFWLRQPD\EH
ORFDWHG IXUWKHU XSVWUHDP RU HOVHZKHUH +HQFH WKH XVH RI FRQVWLWXWLYH SURPRWHUV RI VKRUW
OHQJWK VKRXOG HQVXUH WKH HXWRSLF H[SUHVVLRQ RI *+ HQFRGLQJ WUDQVJHQHV ZLWKRXW
UHVSRQVLYHQHVV WR LQWHUQDO QHJDWLYH IHHGEDFN PHFKDQLVPV /RQJHU SURPRWHUV PD\ IDYRXU
LQVWHDGJUHDWHUPRGXODWRU\FRQWURO0RUHRYHUQDWLYHSURPRWHUVFRXOGEHPRGLILHGQRWRQO\LQ
OHQJWK EXW DOVR LQ WKH DUUDQJHPHQW RI WKHLU UHVSRQVH HOHPHQWV ZKRVH QXPEHU DQG SRVLWLRQ
PD\EHFKDQJHG

)LVK H[SUHVVLQJ *+HQFRGLQJ WUDQVJHQHV HXWRSLFDOO\ RU HYHQ HFWRSLFDOO\ EXW DW D ORZ
OHYHOPD\EHWWHUUHFRQFLOHJURZWKHQKDQFHPHQWZLWKWKHSUHVHUYDWLRQRIDQRUPDOSKHQRW\SH
,Q 0HGLWHUUDQHDQ FXOWXUHG ILVK PRUH SK\VLRORJLFDO SURPRWHUV FRXOG EH FRXSOHG WR VSHFLHV
VSHFLILF *+ HQFRGLQJ '1$V DOWKRXJK WKLV PD\ FRPSOLFDWH VRPHKRZ WKH DVVHVVPHQW RI
WUDQVJHQH LQWHJUDWLRQ ,Q IDFW WKH F'1$ VHTXHQFH RI *+ KDV EHHQ GHWHUPLQHG LQ ERWK
VHDEUHDP DQG VHDEDVV 7UDQVJHQLF ILVK EHDULQJ VSHFLHVVSHFLILF FRQVWUXFWV ZLWK HXWRSLF

ϯϳϰ

H[SUHVVLRQLISURGXFHGLQWKHIXWXUHZRXOGEHDXWRWUDQVJHQLFDQGPLJKWEHHYHQFRQVLGHUHG
IRUXVHDVEURRGVWRFNLQVHOHFWLYHEUHHGLQJSURJUDPV,QWKLVFDVHWUDQVJHQHWLFVZRXOGEOHQG
ZLWKTXDQWLWDWLYHJHQHWLFV

)LQDOO\ D EULHI UHPDUN DERXW IDLUQHVV LQ ILVK WUDQVJHQHVLV DQ LVVXH WKDW DPRXQWV WR
ZKHWKHUDQG KRZ WRLQIRUP FRQVXPHUV DERXW ILVK KDYH EHHQ JHQHWLFDOO\ HQJLQHHUHG $VIRU
RWKHU WUDQVJHQLF SURGXFWV DQ REYLRXV PDUNHWLQJ VWUDWHJ\ LV WR DYRLG DQ\ SXEOLFLW\ RQ WKH
JURXQGVWKDWRQO\WUDQVJHQLFILVKWKDWDUHQXWULWLRQDOO\VDIHFDQEHDSSURYHGIRUVDOH%HFDXVH
WKLVVWDWHPHQWLVUHDVRQDEO\WUXHDQ\ODEHODWWHVWLQJWKHW\SHRISURGXFWLRQWHFKQRORJ\VHHPV
LQGHHG UHGXQGDQW DQG SRVVLEO\ D VRXUFH RI FRQIXVLRQ DQG DQ[LHW\ RQ WKH SDUW RI WKH
FRQVXPHUV <HW WKLV DSSURDFK LV XQIDLU ,W LV PDQLSXODWLYH RSSRUWXQLVWLF DQG LQWLPDWHO\
GLVWUXVWLQJERWKWKHSURGXFWDQGWKHFRQVXPHU3HUKDSVRQHGD\ZHVKDOOUHDOL]HWKDWZHDOO
EHORQJ WR D VRFLHW\ RI FRQVXPHUV DQG WKDW ZH GHVHUYH UHVSHFWIXO LQIRUPDWLRQ PHUHO\ RQ
WUDQVJHQLFVEXWRQDQ\SURGXFW

&RQFOXVLRQ

,QFRQFOXVLRQDTXDWLFELRWHFKQRORJ\LVH[SHFWHGWRSURYLGHDIXQGDPHQWDOFRQWULEXWLRQ
WRWKHIRUHVHHDEOHGHYHORSPHQWRIILVKFXOWXUH,QWKLVUHJDUGWKH0HGLWHUUDQHDQFXOWXUHGILVK
UHSUHVHQW D VWLPXODWLQJ FKDOOHQJH IRU WZR PDLQ UHDVRQV WKHLU ELRORJ\ LV PRUH GLIILFXOW WR
DSSURDFKWKDQWKDWRIIUHVKZDWHUILVKHVDQGWKXVUHTXLUHVDPRUHVRSKLVWLFDWHGWHFKQRORJLFDO
OHYHODQGDQ\DFKLHYHPHQWLQWKHVHVSHFLHVLVOLNHO\WRRSHQQHZDYHQXHVIRUWKHH[SDQVLRQ
RIPDULFXOWXUHDQGWKHDSSUHFLDWLRQRILWVHQRUPRXVSRWHQWLDOIRUPDQNLQG,QWKLVHQGHDYRXU
WKH VFLHQWLILF FRPPXQLW\ QHHGV QRW RQO\ WKH LQJHQXLW\ GHGLFDWLRQ SUXGHQFH DQG LQWHUQDO
FULWLFLVPRILWVPHPEHUVEXWDOVRDQLQIRUPHGSHUFHSWLRQDQGVXSSRUWE\WKHJHQHUDOSXEOLF

7KHUHLVDWUHPHQGRXVEHDXW\FRQFHDOHGLQPDULQHOLIHZLWKLWVJHQHURXVWURYHRIJLIWVWR
RXUH[LVWHQFH$TXDWLFELRWHFKQRORJ\LVDQDWWHPSWWRHQULFKWKLVEHDXW\ZLWKDVPDOOVLJQRI
KXPDQLQWHOOLJHQFHSHUKDSVWRHQODUJHWKHVLJQLILFDQFHRIRXUIOHHWLQJWLPHPRUHSUREDEO\WR
ZDWFKRXUVHOYHVDVDSDUWRIDPLUDFOH

$UWLILFLDOSURSDJDWLRQIRU&KURPRVRPHPDQLSXODWLRQ

0DQLSXODWLRQRIILVKUHSURGXFWLRQDQLPSRUWDQWVFLHQWLILFGHYHORSPHQWIRUDTXDFXOWXUH
PD\ EH SHUIRUPHG DW YDULRXV OHYHOV RI DUWLILFLDO SURSDJDWLRQ 6SDZQLQJ PD\ EH FRQWUROOHG
WKURXJK HQYLURQPHQWDO PDQLSXODWLRQ RU WKURXJK GLUHFW KRUPRQDO LQWHUYHQWLRQ 7KH EDVLF
WHFKQLTXHV DQG FDSDFLW\ IRU FRQWURO YDU\ EHWZHHQ VSHFLHV 7LODSLDV GR QRW UHVSRQG ZHOO WR
KRUPRQDO LQGXFWLRQ EXW FDQ EH LQGXFHG WR VSDZQ WKURXJK PDQLSXODWLRQ RI HQYLURQPHQWDO
YDULDEOHV $ VXLWDEOH WHPSHUDWXUH DQG FRQWUROOHG SKRWRSHULRG SHUPLW D UHDVRQDEO\ FORVH
SUHGLFWLRQRIRYXODWLRQWLPH

&KURPRVRPHPDQLSXODWLRQZKLFKLQFOXGHVSORLG\DOWHUDWLRQRUHXSORLG\LQGXFWLRQZLWK
VLQJOHSDUHQWJHQRPHFRQWULEXWLRQUHTXLUHVWKHFROOHFWLRQRIIUHVKO\UHOHDVHGJDPHWHV3ORLG\
PDQLSXODWLRQLQFOXGHV WKH LQGXFWLRQ RI WULSORLGVWKURXJK SRODU ERG\ UHWHQWLRQ RU WHWUDSORLG\
WKURXJK LQWHUIHUHQFH ZLWK ILUVW NDU\RNLQHVLV (XSORLG DOWHUDWLRQV LQFOXGH J\QRJHQHWLF
J\QRJHQRWH  GLSORLGL]DWLRQ RI WKH PDWHUQDO JHQRPH WKURXJK SRODU ERG\ UHWHQWLRQ
PHLRJ\QRWH  RU PLWRWLF LQWHUIHUHQFH PLWRJ\QRWH  'LSORLGL]DWLRQ RI WKH SDWHUQDO JHQRPH
DQGURJHQRWH RUDQGURJHQHVLVLVDFFRPSOLVKHGE\LQWHUIHUHQFHZLWKILUVWPLWRVLV,QWKHFDVH
RI DQGURJHQHVLV DQG J\QRJHQHVLV HLWKHU WKH IHPDOH RU PDOH '1$ UHVSHFWLYHO\ PXVW EH

ϯϳϱ

UHQGHUHG LQDFWLYH EHIRUH WKH HJJ LV DFWLYDWHG %RWK SDUHQWDO JHQRPHV DUH LQWDFW KRZHYHU
GXULQJSORLG\PDQLSXODWLRQ

&KURPRVRPH PDQLSXODWLRQ LQYROYHV RQH RU WZR EDVLF WUHDWPHQWV RI IUHVKO\ REWDLQHG
JDPHWHV )RU J\QRJHQHVLV RU DQGURJHQHVLV WKH ILUVW WUHDWPHQW LV WKH JHQRPH GHDFWLYDWLRQ RI
WKHVSHUPDWR]RDRUHJJV UHVSHFWLYHO\ 8OWUDYLROHW LUUDGLDWLRQLV SUHIHUUHGIRUVLPSOLFLW\DQG
VDIHW\EXWDOVREHFDXVHLWGLPHUL]HVWKH'1$UDWKHUWKDQIUDJPHQWLQJLW$FWLYDWLRQRIWUHDWHG
VSHUPDWR]RD RU HJJV UHTXLUHV GLSORLGL]DWLRQ E\ VRPH IRUP RI VKRFN WKDW HLWKHU UHWDLQV WKH
VHFRQG SRODU ERG\ SE  RU LQWHUUXSWV WKH ILUVW PLWRWLF NDU\RNLQHVLV 6KRFN LV PRVW RIWHQ
SK\VLFDO HJ WKHUPDO >FROG RU KRW@ RU SUHVVXUH  7KHUPDO WUHDWPHQW LV XVXDOO\ SUHIHUUHG
EHFDXVH RI WKH HDVH RI DSSOLFDWLRQ DQG WKH VLPSOLFLW\ RI WKH HTXLSPHQW XVHG 7R GLVUXSW
FKURPRVRPHVHSDUDWLRQWKHVKRFNPXVWFRLQFLGHZLWKPHWDSKDVHDQGEHVXIILFLHQWO\VHYHUHWR
GLVUXSW WKH VSLQGOH ILEHUV 7KXV VKRFN LQWHQVLW\ GXUDWLRQ DQG WLPH RI DSSOLFDWLRQ PXVW EH
RSWLPDOO\ FRPELQHG WR HQVXUH D PD[LPXP \LHOG RI SURJHQ\ )XUWKHU EHFDXVH WKH UDWH RI
GHYHORSPHQWLVLQYHUVHO\WHPSHUDWXUHGHSHQGHQWHLWKHUWKHSUHVKRFNLQFXEDWLRQWHPSHUDWXUH
PXVWEHVWDQGDUGL]HGRUWKHVKRFNWLPHPXVWEHFDOLEUDWHGWRFRPSHQVDWHIRUWKHWHPSHUDWXUH
HIIHFW $EVROXWH VKRFN WLPH W6  LQ PLQXWHV SRVWDFWLYDWLRQ  FDQ EH UHODWHG WR WDX W  LQ
PLQXWHV  WR UHSRUW VKRFN SURWRFRO LQ D GLPHQVLRQOHVV WHUP W6W  ZKLFK LV WHPSHUDWXUH
FRPSHQVDWHG

6SDZQLQJ

6SDZQLQJ RI 2 QLORWLFXV ZDV PDQDJHG E\ SKRWRSHULRG PDQLSXODWLRQ )RXU WR VL[
IHPDOHVZHUHVWRFNHGZLWKRQHPDOHLQIRXUODTXDULD:DWHUZDVDHUDWHGDQGFLUFXODWHGDW
WKHUDWHRIRQHWXUQRYHUSHUGD\DQGWHPSHUDWXUHZDVPDLQWDLQHGDWÛ&7KHOLJKWF\FOHZDV
LQLWLDWHGDWKWKHWLPHRIVXQVHWVLJQDOOHGWKHHQGRIWKHSKRWRSHULRGIRUDWRWDORIDERXW
OLJKW KRXUV DQG  GDUN KRXUV /'  2 QLORWLFXV VSDZQV DERXW  WR  K DIWHU WKH
EHJLQQLQJ RI WKH OLJKW F\FOH 2YXODWLRQ DQG VSDZQLQJ UHDGLQHVV ZHUH GHWHUPLQHG WKURXJK
REVHUYDWLRQ RI FRXUWVKLS EHKDYLRU FRORUDWLRQ DQG SDSLOOD HUHFWLRQ )HPDOHV ZHUH VWULSSHG
DIWHUWKHLQLWLDWLRQRIVSDZQLQJRUXSRQREVHUYDWLRQRIRWKHUGHWHUPLQDQWV

)HUWLOL]DWLRQ

(JJVZHUHFROOHFWHGLQDFOHDQFRQWDLQHUPLOWZDVH[SUHVVHGRYHUWKHHJJVDQGZDWHU
ZDVGLUHFWO\DGGHGWRLQLWLDWHDFWLYDWLRQ:LWKLQWZRWRWKUHHPLQXWHVRIDFWLYDWLRQIHUWLOL]HG
HJJV ZHUH SODFHG LQ FRQWUROOHG WHPSHUDWXUH Û&  LQFXEDWRUV 7KH LQFXEDWLRQ WHPSHUDWXUH
ZDV FORVHO\ UHJXODWHG WR GRFXPHQW WKH HPEU\RQLF UDWH RI GHYHORSPHQW VR WKDW WLPLQJ RI
GLSORLGL]DWLRQVKRFN FRXOG EH GHWHUPLQHG (JJV ZHUH LQFXEDWHG LQ O XSZHOOLQJ XQLWV ZLWK
VXIILFLHQWIORZWRJHQWO\WXPEOHWKHGHYHORSLQJHPEU\RV

7DX(VWLPDWHV

'HYHORSPHQWDO UDWH LV GHILQHG DV WKH GXUDWLRQ RI RQH PLWRWLF F\FOH GXULQJ HDUO\
V\QFKURQRXVFOHDYDJH7KHPHDQLQWHUYDOEHWZHHQWKHLQLWLDWLRQRIWKHILUVWDQGWKLUGPLWRVHV
LQWRRIWKHHJJVZDVUHFRUGHGDWWHPSHUDWXUHVZLWKLQWKHXVXDOGHYHORSPHQWDOUDQJH
 WR Û&  7ZHQW\ WR WKLUW\ HJJV ZHUH H[DPLQHG XQGHU PDJQLILFDWLRQ DW ILYHPLQXWH
LQWHUYDOV 7DX FXUYHV KDYH EHHQ XVHG WR IDFLOLWDWH FKURPRVRPH PDQLSXODWLRQ VWXGLHV LQ
YDULRXVILVKHV7KHPHFKDQLFVRIWKLVWHFKQLTXHKDYHEHHQPRUHGLIILFXOWZLWKWLODSLDVGXHWR
WKHGLIILFXOWLHVDVVRFLDWHGZLWKJDPHWHFROOHFWLRQ


ϯϳϲ

5HVXOWV

3KRWRSHULRG PDQLSXODWLRQ LQGXFHG VSDZQLQJ DFWLYLW\ WR RFFXU DW PLGGD\ )HPDOHV
RYXODWHGVSDZQHGEHWZHHQDQGK PHDQ K DIWHULQLWLDWLRQRIWKHOLJKWF\FOH
7KHUHZDVQRDSSDUHQWFRUUHODWLRQEHWZHHQWKHODWHQWSHULRGDQGZDWHUWHPSHUDWXUHKRZHYHU
WHPSHUDWXUH YDULDWLRQ ZDV ORZ  WR Û&  'XULQJ WKH VSDZQLQJ VHDVRQ HJJV ZHUH
FROOHFWHGIURPWHQ1LOHWLODSLD)HUWLOL]DWLRQUDWHVZHUHYDULDEOHZLWKQRGHYHORSPHQWLQILYH
RI WHQ EDWFKHV )HUWLOL]DWLRQ DQG KDWFKLQJ UDWHV DUH SRRU DPRQJ WLODSLDV HYHQ WKRXJK HJJ
UHVRUSWLRQLVFRPPRQ(JJUHVRUSWLRQGRHVQRWDOZD\VSUHYHQWRYXODWLRQRIWKHEDGHJJV7KH
ORZUDWHRIIHUWLOL]DWLRQPD\DOVREHGXHWRWKHW\SHRILQFXEDWLRQV\VWHPXVHG

7KHKDWFKUDWHRIDQXSZHOOLQJW\SHRILQFXEDWRULVQRWDVJRRGDVDGRZQIORZV\VWHP
LQFXEDWRU (VWLPDWHV RI WDX ZHUH PDGH DW ILYH WHPSHUDWXUHV UDQJLQJ IURP  WR Û&
7DEOH   7KH VDPSOH VL]H RI WKLV VWXG\ LV WRR VPDOO WR HYDOXDWH YDULDELOLW\ KRZHYHU WKH
HVWLPDWHVRIYDULDELOLW\KDYHEHHQWLJKWO\DVVRFLDWHGZLWKDWDXFXUYHFDOFXODWHGIURPGDWDRQ
WLPHWRILUVWPLWRVLVLQ2DXUHXV7KHWKHRUHWLFDOWDXFXUYHIRU1LOHWLODSLDXVHGLQWKLVVWXG\
ZDV JHQHUDWHGXVLQJWKHWHFKQLTXHV RI5XELQVKWHLQ HW DO7KLVFXUYHLVFKDUDFWHUL]HG E\WKH
UHODWLRQVKLS


ZKHUH [ LV WHPSHUDWXUH LQ Û& 7KH WDXWHPSHUDWXUH UHODWLRQVKLS VKRZHG DQ LQYHUVH
FRUUHODWLRQDQGUDQJHGIURPWRPLQXWHVLQWKHREVHUYHGWHPSHUDWXUHUDQJH

7DEOH7HPSHUDWXUHWDXUHODWLRQVKLSIRU1LOHWLODSLD
,QFXEDWLRQ
7HPSHUDWXUH 2EVHUYHG{ &DOFXODWHG
Û&  PLQXWHV  { PLQXWHV 
  
  
  
  
  

&DOFXODWHGFXUYHGHYHORSHGIURPGDWDIRUWLPHWRILUVWPLWRVHVLQ2DXUHXEDVHGRQPHWKRGV
RI5XEHQVKWHLQHWDO  WKHFDOFXODWHGWDXFXUYHLVFKDUDFWHUL]HGE\WKHUHODWLRQVKLSIJ 
[ZKHUH[ WHPSHUDWXUH Û& 
'LVFXVVLRQ

2YXODWLRQ EDVHG RQ WKH OLJKW F\FOH ZDV D UHDVRQDEOH PHDQV IRU SUHGLFWLQJ WLPH RI
VWULSSLQJ +RUPRQDO LQGXFWLRQ RI RYXODWLRQ ZRXOG VHHP WR EH D ORJLFDO PHWKRG IRU
GHWHUPLQDWLRQ RI HJJ FROOHFWLRQ KRZHYHU FLFKOLGV KDYH UHVSRQGHG SRRUO\ WR JRQDGRWURSLF
WKHUDS\&RQYHUVHO\WKHSK\VLRORJLFDOFKDUDFWHULVWLFVRIWLODSLDJDPHWHVSURYLGHDQDGYDQWDJH
LQFKURPRVRPHPDQLSXODWLRQ(JJVUHWDLQKLJKIHUWLOLW\IRUWKUHHWRVL[KRXUVSRVWLPPHUVLRQ
LQ ZDWHU DQG VSHUP UHPDLQ PRWLOH LQ ZDWHU IRU VHYHUDO KRXUV LQ FRQWUDVW ZLWK PRVW ILVKHV
7KXVWKHTXDOLW\RIJDPHWHVVKRXOGQRWGHWHULRUDWHGXULQJ89WUHDWPHQWLQFRPSDULVRQZLWK
RWKHU ILVKHV 0RUH VXLWDEOH LQFXEDWLRQ WHFKQLTXHV PXVW EH LQFRUSRUDWHG LQ WKH FKURPRVRPH
PDQLSXODWLRQSURWRFROEHFDXVHVXUYLYDOLVORZHUIRUJHQRPHPDQLSXODWHGSURJHQ\


ϯϳϳ

 $UHDVRQDEOHILUVWHVWLPDWHRIDWDXFXUYHFDQEHXVHGWRVWDQGDUGL]HVKRFNWUHDWPHQWV
7KHQH[WDVSHFWRIWKLVUHVHDUFKZLOOEHWKHGHYHORSPHQWRI89WUHDWPHQWRIHJJV7UHDWPHQW
RI VSHUP ZLWK 89 KDV EHHQ URXWLQH IRU WKH LQGXFWLRQ RI J\QRJHQHVLV EXW IHZ VWXGLHV KDYH
DWWHPSWHGDQGURJHQHVLVZKLFKUHTXLUHVHJJWUHDWPHQW(YHQIHZHUVWXGLHVKDYHXVHG89LQ
IHPDOHJHQRPHGHDFWLYDWLRQ3UHOLPLQDU\WULDOVKDYHYHULILHGWKHJHQHUDOGRVDJHOHYHO WR
-P 

7KHUPDO VKRFN WUHDWPHQWV ZLOO EH XVHG IRU SUDFWLFDO UHDVRQV DQG EHFDXVH WKHLU
HIIHFWLYHQHVVLVFRPSDUDEOHWRRUEHWWHUWKDQSUHVVXUHVKRFN+RZHYHUWKHWLPLQJIRUVKRFNDW
 PLQXWHV SRVWDFWLYDWLRQ Û&  FRQWUDGLFWV WKH RSWLPDO VKRFN WLPH RI  PLQXWHV SRVW
DFWLYDWLRQ Û&  HYHQ ZKHQ DGMXVWHG IRU WHPSHUDWXUH 7KHUHIRUH WKHVH UHSRUWHG RSWLPDO
WLPHVDQGVKRFNW\SHVZLOOEHH[DPLQHGZLWKLQWKHFRQWH[WRIWDXLQIRUPDWLRQ

$YLVXDOJHQHWLFPDUNHULVYLWDOLQFKURPRVRPHPDQLSXODWLRQVWXGLHV2QHRSWLRQZLWK
1LOH WLODSLD LV WKH XVH RI QRUPDOFRORU IHPDOHV DQG PDOHV RI WKH EORQG PXWDQW 7KLV
KRPR]\JRXV UHFHVVLYH WUDLW ZRXOG XVXDOO\ EH DSSURSULDWH $OWHUQDWLYHO\ WKH UHG PXWDQW
ZKLFKLVDGRPLQDQWJHQHFRXOGEHXVHGIRUDQHJJVRXUFHDQGQRUPDOFRORUPDOHVDVVSHUP
GRQRUV :KLOH GHYHORSLQJ WKH UHG PXWDQW OLQH DQGURJHQHWLF H[SHULPHQWDWLRQ VKDOO SURFHHG
XVLQJWKHFXUUHQW1LOHVWRFNDQGDJROGPXWDQWRI2PRVVDPELFXVDVWKHVSHUPGRQRU

7KHGHYHORSPHQWRIDQGURJHQHVLVIRU2QLORWLFXVVKRXOGSURYLGHDQDOWHUQDWLYHPHWKRG
IRUSURGXFLQJ<<PDOHVIRUWKHPRQRVH[SURGXFWLRQRIWLODSLD


5HIHUHQFHV

'HWWODII 7$  7KH UDWH RI GHYHORSPHQW LQ SRLNLORWKHUPLF DQLPDOV FDOFXODWHG LQ
DVWURQRPLFDODQGUHODWLYHWLPHXQLWV-7KHUP%LRO
'HWWODII 7$ DQG $$ 'HWWODII  2Q UHODWLYH GLPHQVLRQOHVV FKDUDFWHULVWLFV RI WKH
GHYHORSPHQWGXUDWLRQLQHPEU\RORJ\$UFK%LRO
'RQ -  6WXG\ RI SORLG\ DQG DUWLILFLDO LQGXFWLRQ RI J\QRJHQHVLV LQ WLODSLDV 3K'
GLVVHUWDWLRQ LQ+HEUHZ %DU,ODQ8QLYHUVLW\7HO$YLY,VUDHO
'RQ-DQG55$YWDOLRQD3URGXFWLRQRIYLDEOHWHWUDSORLGWLODSLDXVLQJWKHFROGVKRFN
WHFKQLTXH%DPLGJHK
'RQ-DQG55$YWDOLRQE&RPSDUDWLYHVWXG\RQWKHLQGXFWLRQRIWULSORLG\LQWLODSLD
XVLQJFROGDQGKHDWVKRFNWHFKQLTXH-)LVK%LRO
+XVVDLQ0*'-3HQPDQ%-0F$QGUHZDQG5-RKQVWRQH6XSUHVVLRQRIWKHILUVW
FOHDYDJH LQ WKH 1LOH WLODSLD 2UHRFKURPLV QLORWLFXV /²D FRPSDULVRQ RI WKH UHODWLYH
HIIHFWLYHQHVVRISUHVVXUHDQGKHDWVKRFN$TXDFXOWXUH
0DLU *&  &KURPRVRPH VHW PDQLSXODWLRQ LQ WLODSLD²WHFKQLTXHV SUREOHPV DQG
SURVSHFWV$TXDFXOWXUH
0F$QGUHZ %- )5 5RXEDO 5- 5REHUWV $0 %XOORFN DQG 0 0F(ZHQ  7KH
JHQHWLFV DQG KLVWRORJ\ RI UHG EORQG DQG DVVRFLDWHG FRORXU YDULDQWV LQ 2UHRFKURPLV
QLORWLFXV*HQHWLFD
0\HUV -0 DQG :. +HUVKEHUJHU  $UWLILFLDO VSDZQLQJ RI WLODSLD HJJV - :RUOG
$TXDFXOW6RF
0\HUV -0 '- 3HQPDQ < %DVDYDUDMX 6) 3RZHOO 3 %DRSUDVHUWNXO .- 5DQD 1
%URPDJHDQG
%-0F$QGUHZ,QGXFWLRQRIGLSORLGDQGURJHQHWLFDQGPLWRWLFJ\QRJHQHWLF1LOHWLODSLD
2UHRFKURPLVQLORWLFXV/ 7KHRU$SSO*HQHW

ϯϳϴ

3HWHUV +0  )HFXQGLW\ HJJ ZHLJKW DQG RRF\WH GHYHORSPHQW LQ WLODSLDV &LFKOLGDH
7HOHRVWHL  ,&/$50 7UDQVO QR  ' 3DXO\  0DQLOD 3KLOLSSLQHV 2ULJLQDO
3XEOLFDWLRQ,QW5HY*HV+\GURELRO 
5DQD .-  $Q HYDOXDWLRQ RI WZR W\SHV RI FRQWDLQHUV IRU WKH DUWLILFLDO LQFXEDWLRQ RI
2UHRFKURPLVHJJV$TXDFXOW)LVK0JW
5DQD.-5HSURGXFWLYHELRORJ\DQGWKHKDWFKHU\UHDULQJRIWLODSLDHJJVDQGIU\,Q
-)0XLUDQG5-5REHUWV (GLWRUV 5HFHQW$GYDQFHVLQ$TXDFXOWXUH&URRP+HOP
/RQGRQSS
5RWKEDUG 6  2EVHUYDWLRQ RQ WKH UHSURGXFWLYH EHKDYLRU RI 7LODSLD ]LOOLL DQG VHYHUDO
6DURWKHURGRQVSSXQGHUDTXDULXPFRQGLWLRQV%DPLGJHK
5RWKEDUG 6 DQG < 3UXJLQLQ  ,QGXFHG VSDZQLQJ DQG DUWLILFLDO LQFXEDWLRQ RI WLODSLD
$TXDFXOWXUH
5XELQVWHLQ , 6 5RWKEDUG DQG :/ 6KHOWRQ  7KH UHODWLRQVKLS EHWZHHQ WKH
HPEU\RORJLFDODJHF\WRNLQHVLVDQGWKHWLPLQJRISORLG\PDQLSXODWLRQVLQILVK,VUDHOL
-$TXDFXOW%DPLGJHK
6KHOWRQ:/0DQDJHPHQWRIILQILVKUHSURGXFWLRQIRUDTXDFXOWXUH&5&5HY$TXDW
6FL
6KHOWRQ:/DQG65RWKEDUG'HWHUPLQDWLRQRIWKHGHYHORSPHQWDOGXUDWLRQ W IRU
SORLG\PDQLSXODWLRQLQFDUSV,VUDHOL-$TXDFXOW%DPLGJHK
6KHOWRQ :/ 6' 0LPV -$ &ODUN $( +LRWW DQG & :DQJ  $ WHPSHUDWXUH
GHSHQGHQW LQGH[ RI PLWRWLF LQWHUYDO W  IRU FKURPRVRPH PDQLSXODWLRQ LQ SDGGOHILVK
DQGVKRYHOQRVHVWXUJHRQ3URJ)LVK&XOW
6KLUDN $  &KURPRVRPH VHW PDQLSXODWLRQV LQ WLODSLDV D PRGHO RI OHWKDO JHQH
LQKHULWDQFH06WKHVLV LQ+HEUHZ %DU,ODQ8QLYHUVLW\7HO$YLY,VUDHO
7DYH ' 0 5H]N DQG 52 6PLWKHUPDQ  *HQHWLFV RI ERG\ FRORU LQ 7LODSLD
PRVVDPELFD-:RUOG$TXDFXOW6RF
7KRUJDDUG*+DQG6.$OOHQ-U&KURPRVRPHPDQLSXODWLRQDQGPDUNHUVLQILVKHU\
PDQDJHPHQW ,Q 1 5\PDQ DQG ) 8WWHU (GLWRUV  3RSXODWLRQ *HQHWLFV DQG )LVKHU\
0DQDJHPHQW:DVKLQJWRQ6HD*UDQW3URJUDP8QLYHUVLW\RI:DVKLQJWRQ3UHVV6HDWWOH
SS
<HKHVNHO 2 DQG 55 $YWDOLRQ  $UWLILFLDO IHUWLOL]DWLRQ RI WLODSLD HJJV D SUHOLPLQDU\
VWXG\ ,Q 5HSURGXFWLRQ LQ )LVK²%DVLF DQG $SSOLHG $VSHFWV LQ (QGRFULQRORJ\ DQG
*HQHWLFV /HV &ROORTXHV GH O¶,15$ QR  ,QVWLWXW 1DWLRQDO GH OD 5HFKHUFKH
$JURQRPLTXH3DULVSS

















ϯϳϵ

 &KDSWHU
$SLFXOWXUH
%HHNHHSLQJ
%HHNHHSLQJ RU DSLFXOWXUH LV WKH PDLQWHQDQFH RI KRQH\ EHH FRORQLHV FRPPRQO\ LQ
KLYHV E\ KXPDQV $ EHHNHHSHU RU DSLDULVW  NHHSV EHHV WR FROOHFW KRQH\ DQG EHHVZD[ WR
SROOLQDWHFURSVRUWRSURGXFHEHHVIRUVDOHWRRWKHUEHHNHHSHUV$ORFDWLRQZKHUHEHHVDUH
NHSWLVFDOOHGDQDSLDU\
7KHUHDUHPRUHWKDQVSHFLHVRIZLOGEHHV0DQ\VSHFLHVDUHVROLWDU\DQGPDQ\
RWKHUV UHDU WKHLU \RXQJ LQ EXUURZV DQG VPDOO FRORQLHV OLNH PDVRQ EHHV DQG EXPEOH EHHV
%HHNHHSLQJRUDSLFXOWXUHLVFRQFHUQHGZLWKWKHSUDFWLFDOPDQDJHPHQWRIWKHVRFLDOVSHFLHV
RI KRQH\ EHHV ZKLFK OLYH LQ ODUJH FRORQLHV RI XS WR  LQGLYLGXDOV ,Q (XURSH DQG
$PHULFD WKH VSHFLHV XQLYHUVDOO\ PDQDJHG E\ EHHNHHSHUV LV WKH :HVWHUQ KRQH\ EHH $SLV
PHOOLIHUD 7KLVVSHFLHVKDVVHYHUDOVXEVSHFLHVRUUHJLRQDOYDULHWLHVVXFKDVWKH,WDOLDQEHH
$SLVPHOOLIHUDOLJXVWLFD (XURSHDQGDUNEHH $SLVPHOOLIHUDPHOOLIHUD DQGWKH&DUQLRODQ
KRQH\EHH $SLVPHOOLIHUDFDUQLFD ,QWKHWURSLFVRWKHUVSHFLHVRIVRFLDOEHHDUHPDQDJHG
IRUKRQH\SURGXFWLRQLQFOXGLQJ$SLVFHUDQD


)LJXUH$SLVPHOOLIHUD
$OO RI WKH $SLV PHOOLIHUD )LJXUH   VXEVSHFLHV DUH FDSDEOH RI LQWHUEUHHGLQJ DQG
K\EULGL]LQJ0DQ\EHHEUHHGLQJFRPSDQLHVVWULYHWRVHOHFWLYHO\EUHHGDQGK\EULGL]HYDULHWLHV
WR SURGXFH GHVLUDEOH TXDOLWLHV GLVHDVH DQG SDUDVLWH UHVLVWDQFH JRRG KRQH\ SURGXFWLRQ
VZDUPLQJ EHKDYLRXU UHGXFWLRQ SUROLILF EUHHGLQJ DQG PLOG GLVSRVLWLRQ 7KH DGYDQWDJHV RI
WKH LQLWLDO ) K\EULGV SURGXFHG E\ WKHVH FURVVHV LQFOXGH K\EULG YLJRU LQFUHDVHG KRQH\
SURGXFWLYLW\ DQG JUHDWHU GLVHDVH UHVLVWDQFH 7KH GLVDGYDQWDJH LV WKDW LQ VXEVHTXHQW
JHQHUDWLRQV WKHVH DGYDQWDJHV PD\ IDGH DZD\ DQG K\EULGV WHQG WR EH YHU\ GHIHQVLYH DQG
DJJUHVVLYH
$W VRPH SRLQW KXPDQV EHJDQ WR GRPHVWLFDWH ZLOG EHHV LQ DUWLILFLDO KLYHV PDGH IURP
KROORZORJVZRRGHQER[HVSRWWHU\YHVVHOVDQGZRYHQVWUDZEDVNHWVRUVNHSV
)RUVHYHUDOWKRXVDQG\HDUVRIKXPDQEHHNHHSLQJKXPDQXQGHUVWDQGLQJRIWKHELRORJ\
DQG HFRORJ\ RI EHHV ZDV YHU\ OLPLWHG DQG ULGGOHG ZLWK VXSHUVWLWLRQ DQG IRONORUH $QFLHQW

ϯϴϬ

 REVHUYHUVWKRXJKWWKDWWKHTXHHQEHHZDVLQIDFWDPDOHFDOOHGWKHNLQJEHHDQGWKH\KDG
QR XQGHUVWDQGLQJ RI KRZ EHHV DFWXDOO\ UHSURGXFHG ,W ZDV QRW XQWLO WKH WK FHQWXU\ WKDW
(XURSHDQ QDWXUDO SKLORVRSKHUV XQGHUWRRN WKH VFLHQWLILF VWXG\ RI EHHFRORQLHVDQGEHJDQ WR
XQGHUVWDQGWKHFRPSOH[DQGKLGGHQZRUOGRIEHHELRORJ\6ZDPPHUGDPDQG5pDXPXUZHUH
DPRQJ WKH ILUVW WR XVH D PLFURVFRSH DQG GLVVHFWLRQ WR XQGHUVWDQG WKH LQWHUQDO ELRORJ\ RI
KRQH\ EHHV 5pDXPXU ZDV DPRQJ WKH ILUVW WR FRQVWUXFW D JODVV ZDOOHG REVHUYDWLRQ KLYH WR
EHWWHUREVHUYHDFWLYLWLHVZLWKLQKLYHV+HREVHUYHGTXHHQVOD\LQJHJJVLQRSHQFHOOVEXWVWLOO
KDGQRLGHDRIKRZDTXHHQZDVIHUWLOL]HGQRERG\KDGHYHUZLWQHVVHGWKHPDWLQJRIDTXHHQ
DQGGURQHDQGPDQ\WKHRULHVKHOGWKDWTXHHQVZHUHVHOIIHUWLOHZKLOHRWKHUVEHOLHYHGWKDWD
YDSRU RU PLDVPD HPDQDWLQJ IURP WKH GURQHV IHUWLOL]HG TXHHQV ZLWKRXW GLUHFW SK\VLFDO
FRQWDFW +XEHU ZDV WKH ILUVW WR SURYH E\ REVHUYDWLRQ DQG H[SHULPHQW WKDW TXHHQV DUH
SK\VLFDOO\ LQVHPLQDWHG E\ GURQHV RXWVLGH WKH FRQILQHV RI KLYHV XVXDOO\ D JUHDW GLVWDQFH
DZD\
)ROORZLQJ5pDXPXU VGHVLJQ+XEHUEXLOWLPSURYHGJODVVZDOOHGREVHUYDWLRQKLYHVDQG
VHFWLRQDOKLYHVZKLFKFRXOGEHRSHQHGOLNHWKHOHDYHVRIDERRNWRLQVSHFWLQGLYLGXDO ZD[
FRPEV WKLV JUHDWO\ LPSURYHG WKH GLUHFW REVHUYDWLRQ RI DFWLYLW\ ZLWKLQ D KLYH $OWKRXJK KH
EHFDPHEOLQGEHIRUHKHZDVWZHQW\+XEHUHPSOR\HGDVHFUHWDU\)UDQFRLV%XUQHQVWRPDNH
GDLO\REVHUYDWLRQVFRQGXFWFDUHIXOH[SHULPHQWVDQGWRNHHSDFFXUDWHQRWHVRYHUDSHULRGRI
PRUHWKDQWZHQW\\HDUV+XEHUFRQILUPHGWKDWDKLYHFRQVLVWVRIRQHTXHHQZKRLVWKHPRWKHU
RIDOOWKHIHPDOHZRUNHUVDQGPDOHGURQHVLQWKHFRORQ\+HZDVDOVRWKHILUVWWRFRQILUPWKDW
PDWLQJZLWKGURQHVWDNHVSODFHRXWVLGHRIKLYHVDQGWKDWTXHHQVDUHLQVHPLQDWHGE\DQXPEHU
RI VXFFHVVLYH PDWLQJV ZLWK PDOH GURQHV KLJK LQ WKH DLUDWD JUHDW GLVWDQFHIURP WKHLU KLYH
7RJHWKHUKHDQG%XUQHQVGLVVHFWHGEHHVXQGHUWKHPLFURVFRSHDQGZHUHDPRQJ WKHILUVWWR
GHVFULEHWKHRYDULHVDQGVSHUPDWKHFDRUVSHUPVWRUHRITXHHQVDVZHOODVWKHSHQLVRIPDOH
GURQHV +XEHU LV XQLYHUVDOO\ UHJDUGHG DV WKH IDWKHU RI PRGHUQ EHHVFLHQFH DQG KLV
1RXYHOOHV2EVHUYDWLRQVVXU/HV$EHLOOHV RU1HZ2EVHUYDWLRQVRQ%HHV UHYHDOHGDOOWKH
EDVLFVFLHQWLILFWUXWKVIRUWKHELRORJ\DQGHFRORJ\RIKRQH\EHHV

1DWXUDO%HHNHHSLQJ
7KHUH LV D FXUUHQW PRYHPHQW WKDW HVFKHZV FKHPLFDOV LQ EHHNHHSLQJ DQG IHHOV WKDW
FRORQ\ FROODSVH GLVRUGHU FDQ EH PRVW HIIHFWLYHO\ DGGUHVVHG E\ UHYHUVLQJ WUHQGV WKDW
GLVUHVSHFW WKH QHHGV RI WKH EHHV WKHPVHOYHV&URS VSUD\LQJ XQQDWXUDO FRQGLWLRQV LQ ZKLFK
EHHVDUHPRYHGWKRXVDQGVRIPLOHVWRSROOLQDWHFRPPHUFLDOFURSVDUWLILFLDOLQVHPLQDWLRQRI
TXHHQVDQGVXJDUZDWHUIHHGLQJDUHWKRXJKWWRDOOFRQWULEXWHWRDJHQHUDOZHDNHQLQJRIWKH
FRQVWLWXWLRQRIWKHKRQH\EHH
6LQFH WKH KRQH\ EHH H[HUWV VXFK D SRZHUIXOO\ EHQHILFLDO LQIOXHQFH RQ WKH QDWXUDO
ZRUOGDURXQGXVLWVHHPVORJLFDOWRDVVXPHWKDWRXURZQHIIRUWVWRKHOSWKHKRQH\EHHWKULYH
FDQLQGLUHFWO\EHQHILWDOORIQDWXUH´

%HHFRORQLHV

&DVWHV
$FRORQ\RIEHHVFRQVLVWVRIWKUHHFDVWHVRIEHH

x D4XHHQEHHZKLFKLVQRUPDOO\WKHRQO\EUHHGLQJIHPDOHLQWKHFRORQ\
x DODUJHQXPEHURIIHPDOH:RUNHUEHHVW\SLFDOO\±LQQXPEHU
x DQXPEHURIPDOHGURQHVUDQJLQJIURPWKRXVDQGVLQDVWURQJKLYHLQVSULQJWR YHU\
IHZGXULQJGHDUWKRUFROGVHDVRQ

ϯϴϭ

 7KHTXHHQLVWKHRQO\VH[XDOO\PDWXUHIHPDOHLQWKHKLYHDQGDOORIWKHIHPDOHZRUNHU
EHHVDQGPDOHGURQHVDUHKHURIIVSULQJ7KHTXHHQPD\OLYHIRUXS WRWKUHH\HDUV RU PRUH
DQGPD\EHFDSDEOHRIOD\LQJKDOIDPLOOLRQHJJVRUPRUHLQKHUOLIHWLPH$WWKHSHDNRIWKH
EUHHGLQJVHDVRQODWHVSULQJWRVXPPHUDJRRGTXHHQPD\EHFDSDEOHRIOD\LQJHJJV
LQRQHGD\PRUHWKDQKHURZQERG\ZHLJKW7KLVZRXOGEHH[FHSWLRQDOKRZHYHUDSUROLILF
TXHHQPLJKWSHDNDWHJJVDGD\EXWDPRUHDYHUDJHTXHHQPLJKWOD\MXVWHJJV
SHUGD\7KHTXHHQLVUDLVHGIURPDQRUPDOZRUNHUHJJEXWLVIHGDODUJHUDPRXQWRIUR\DO
MHOO\WKDQDQRUPDOZRUNHUEHHUHVXOWLQJLQDUDGLFDOO\GLIIHUHQWJURZWKDQGPHWDPRUSKRVLV
7KH TXHHQ LQIOXHQFHV WKH FRORQ\ E\ WKH SURGXFWLRQ DQG GLVVHPLQDWLRQ RI D YDULHW\ RI
SKHURPRQHV RU TXHHQ VXEVWDQFHV  2QH RI WKHVH FKHPLFDOV VXSSUHVVHV WKH GHYHORSPHQW RI
RYDULHVLQDOOWKHIHPDOHZRUNHUEHHVLQWKHKLYHDQGSUHYHQWVWKRVHOD\LQJHJJV

0DWLQJRITXHHQV
7KHTXHHQHPHUJHVIURPKHUFHOODIWHUGD\VRIGHYHORSPHQWDQGVKHUHPDLQVLQWKH
KLYHIRUGD\VEHIRUHYHQWXULQJRXWRQDPDWLQJIOLJKW0DWLQJIOLJKWLVRWKHUZLVHNQRZQ
DV QXSWLDO IOLJKW  +HU ILUVW RULHQWDWLRQ IOLJKW PD\ RQO\ ODVW D IHZ VHFRQGV MXVW HQRXJK WR
PDUN WKH SRVLWLRQ RI WKH KLYH 6XEVHTXHQW PDWLQJ IOLJKWV PD\ ODVW IURP  PLQXWHV WR 
PLQXWHV DQG VKH PD\ PDWH ZLWK D QXPEHU RI PDOH GURQHV RQ HDFK IOLJKW 2YHU VHYHUDO
PDWLQJVSRVVLEO\DGR]HQRUPRUH WKHTXHHQZLOOUHFHLYHDQGVWRUH HQRXJK VSHUP IURP D
VXFFHVVLRQRIGURQHV WRIHUWLOL]HKXQGUHGVRIWKRXVDQGVRIHJJV,I VKH GRHV QRW PDQDJH WR
OHDYHWKHKLYHWRPDWHSRVVLEO\GXHWREDGZHDWKHURUEHLQJWUDSSHGZLWKLQSDUWRIWKHKLYH
VKHZLOOUHPDLQLQIHUWLOHDQGEHFRPHD GURQHOD\HU LQFDSDEOHRISURGXFLQJIHPDOHZRUNHU
EHHVDQGWKHKLYHLVGRRPHG
0DWLQJWDNHVSODFHDWVRPHGLVWDQFHIURPWKHKLYHDQGRIWHQVHYHUDOKXQGUHGIHHWXSLQ
WKHDLULWLVWKRXJKWWKDWWKLVVHSDUDWHVWKHVWURQJHVWGURQHVIURPWKHZHDNHURQHVHQVXULQJ
WKDWRQO\WKHIDVWHVWDQGVWURQJHVWGURQHVJHWWRSDVVRQWKHLUJHQHV

)HPDOHZRUNHUEHHV
0RVWEHHVLQDKLYHDUHIHPDOHZRUNHUEHHV$WWKHKHLJKWRIVXPPHUZKHQDFWLYLW\LQ
WKHKLYHLVIUDQWLFDQGZRUNJRHVRQQRQVWRSWKHOLIHRIDZRUNHUEHHPD\EHDVVKRUWDV
ZHHNV LQ ODWH DXWXPQ ZKHQ QR EURRG LV EHLQJ UDLVHG DQG QR QHFWDU LV EHLQJ KDUYHVWHG D
\RXQJ EHH PD\ OLYH IRU  ZHHNV ULJKW WKURXJK WKH ZLQWHU 'XULQJ LWV OLIH D ZRUNHU EHH
SHUIRUPV GLIIHUHQW ZRUN IXQFWLRQV LQ WKH KLYH ZKLFK DUH ODUJHO\ GLFWDWHGE\ WKHDJH RI WKH
EHH
3HULRG :RUNDFWLYLW\
'D\V &OHDQLQJFHOOVDQGLQFXEDWLRQ
'D\ )HHGLQJROGHUODUYDH
'D\ )HHGLQJ\RXQJHUODUYDH
'D\ 5HFHLYLQJKRQH\DQGSROOHQIURPILHOGEHHV
'D\ :D[PDNLQJDQGFHOOEXLOGLQJ
'D\RQZDUGV (QWUDQFHJXDUGVQHFWDUDQGSROOHQIRUDJLQJ

0DOHEHHV GURQHV 
'URQHVDUHWKHODUJHVWEHHVLQWKHKLYHDWDOPRVWWKUHHWLPHVWKHVL]HRIDZRUNHUEHH
7KH\GRQRWZRUNGRQRWIRUDJHIRUSROOHQRUQHFWDUDQGDUHRQO\SURGXFHGWRPDWHZLWKQHZ
TXHHQVDQGIHUWLOL]HWKHPRQWKHLUPDWLQJIOLJKWV$EHHFRORQ\ZLOOJHQHUDOO\VWDUWWRUDLVH
GURQHV D IHZ ZHHNV EHIRUH EXLOGLQJ TXHHQ FHOOV WR VXSHUVHGH D IDLOLQJ TXHHQ RU LQ
SUHSDUDWLRQ IRU VZDUPLQJ :KHQ TXHHQ UDLVLQJ IRU WKH VHDVRQ LV RYHU WKH EHHV LQ FROGHU
ϯϴϮ

 FOLPDWHV ZLOO GULYH WKH GURQHV RXW RI WKH KLYH WR GLH ELWLQJ DQG WHDULQJ DW WKHLU OHJV DQG
ZLQJV WKH GURQHV KDYH EHFRPH D XVHOHVV EXUGHQ RQ WKH FRORQ\ ZKLFK FDQ QR ORQJHU EH
WROHUDWHG

'LIIHULQJVWDJHVRIGHYHORSPHQW

6WDJHRI
GHYHORSPHQW 4XHHQ :RUNHU 'URQH
(JJ GD\V GD\V GD\V
/DUYD GD\V GD\V GD\V
3XSD GD\V GD\V GD\V
7RWDO GD\V GD\V GD\V


6WUXFWXUHRIDEHHFRORQ\
$ GRPHVWLFDWHG EHH FRORQ\ LV QRUPDOO\ KRXVHG LQ D UHFWDQJXODU KLYH ERG\ ZLWKLQ
ZKLFKHLJKWWRWHQSDUDOOHOIUDPHVKRXVHWKHYHUWLFDOSODWHVRIKRQH\FRPEZKLFKFRQWDLQWKH
HJJV ODUYDH SXSDH DQG IRRG IRU WKH FRORQ\ ,I RQH ZHUH WR FXW D YHUWLFDO FURVVVHFWLRQ
WKURXJK WKH KLYH IURP VLGH WR VLGH WKH EURRG QHVW ZRXOG DSSHDU DV D URXJKO\ RYRLG EDOO
VSDQQLQJ  IUDPHV RI FRPE 7KH WZR RXWVLGH FRPEV DW HDFK VLGH RI WKH KLYH WHQG WR EH
H[FOXVLYHO\XVHGIRUORQJWHUPVWRUDJHRIKRQH\DQGSROOHQ
:LWKLQWKHFHQWUDOEURRGQHVWDVLQJOHIUDPHRIFRPEZLOOW\SLFDOO\KDYHDFHQWUDOGLVN
RIHJJVODUYDHDQGVHDOHGEURRGFHOOVZKLFKPD\H[WHQGDOPRVWWRWKHHGJHVRIWKHIUDPH
,PPHGLDWHO\DERYHWKHEURRGSDWFKDQDUFKRISROOHQILOOHGFHOOVH[WHQGVIURPVLGHWRVLGH
DQG DERYH WKDW DJDLQ D EURDGHU DUFK RI KRQH\ILOOHG FHOOV H[WHQGV WR WKH IUDPH WRSV 7KH
SROOHQLVSURWHLQULFKIRRGIRUGHYHORSLQJODUYDHZKLOHKRQH\LVDOVRIRRGEXWODUJHO\HQHUJ\
ULFKUDWKHUWKDQSURWHLQULFK7KHQXUVHEHHVZKLFKFDUHIRUWKHGHYHORSLQJEURRGVHFUHWHD
VSHFLDOIRRGFDOOHG UR\DOMHOO\ DIWHUIHHGLQJWKHPVHOYHVRQKRQH\DQGSROOHQ7KHDPRXQWRI
UR\DOMHOO\ZKLFKLVIHGWRDODUYDGHWHUPLQHVZKHWKHULWZLOOGHYHORSLQWRDZRUNHUEHHRUD
TXHHQ
$SDUW IURP WKH KRQH\ VWRUHG ZLWKLQ WKH FHQWUDO EURRG IUDPHV WKH EHHV VWRUH VXUSOXV
KRQH\LQFRPEVDERYHWKHEURRGQHVW,QPRGHUQKLYHVWKHEHHNHHSHUSODFHVVHSDUDWHER[HV
FDOOHG VXSHUV DERYH WKHEURRG ER[ LQ ZKLFKDVHULHV RI VKDOORZHU FRPEV LV SURYLGHG IRU
VWRUDJH RI KRQH\ 7KLV HQDEOHV WKH EHHNHHSHU WR UHPRYH VRPH RI WKH VXSHUV LQ WKH ODWH
VXPPHUDQGWRH[WUDFWWKHVXUSOXVKRQH\KDUYHVWZLWKRXWGDPDJLQJWKHFRORQ\RIEHHVDQG
LWV EURRG QHVW EHORZ ,IDOO WKH KRQH\ LV VWROHQ LQFOXGLQJ WKH DPRXQW RI KRQH\ QHHGHG WR
VXUYLYHZLQWHUWKHEHHNHHSHUPXVWUHSODFHWKHVHVWRUHV E\ IHHGLQJWKH EHHV¶ VXJDU RU FRUQ
V\UXSLQDXWXPQ

$QQXDOF\FOHRIDEHHFRORQ\
7KHGHYHORSPHQWRIDEHHFRORQ\IROORZVDQDQQXDOF\FOHRIJURZWKZKLFKEHJLQVLQ
VSULQJ ZLWK D UDSLGH[SDQVLRQ RI WKH EURRGQHVW DV VRRQ DV SROOHQ LV DYDLODEOHIRU IHHGLQJ
ODUYDH6RPHSURGXFWLRQRIEURRGPD\EHJLQDVHDUO\DV-DQXDU\HYHQLQDFROGZLQWHUEXW
EUHHGLQJ DFFHOHUDWHV WRZDUGV D SHDN LQ 0D\ LQ WKH QRUWKHUQ KHPLVSKHUH  SURGXFLQJ DQ
DEXQGDQFH RI KDUYHVWLQJ EHHV V\QFKURQL]HG WR WKH PDLQ QHFWDU IORZ  LQ WKDW UHJLRQ (DFK
UDFH RI EHHV WLPHV WKLV EXLOGXS VOLJKWO\ GLIIHUHQWO\ GHSHQGLQJ RQ KRZ WKH IORUD RI LWV
RULJLQDOUHJLRQEORRPV6RPHUHJLRQVRI (XURSHKDYH WZR QHFWDU IORZVRQH LQ ODWH VSULQJ

ϯϴϯ

 DQG DQRWKHU LQ ODWH $XJXVW 2WKHU UHJLRQV KDYH RQO\ D VLQJOH QHFWDU IORZ 7KH VNLOO RI WKH
EHHNHHSHU OLHV LQ SUHGLFWLQJ ZKHQ WKH QHFWDU IORZ ZLOO RFFXU LQ KLV DUHD DQG LQ WU\LQJ WR
HQVXUH WKDW KLV FRORQLHV DFKLHYH D PD[LPXP SRSXODWLRQ RI KDUYHVWHUV DW H[DFWO\ WKH ULJKW
WLPH
7KH NH\ IDFWRU LQ WKLV LV WKH SUHYHQWLRQ RU VNLOOIXO PDQDJHPHQW RI WKH VZDUPLQJ
LPSXOVH,IDFRORQ\VZDUPVXQH[SHFWHGO\DQGWKHEHHNHHSHUGRHVQRWPDQDJHWRFDSWXUHWKH
UHVXOWLQJVZDUPKHLVOLNHO\WRKDUYHVWVLJQLILFDQWO\OHVVKRQH\IURPWKDWKLYHEHFDXVHKH
ZLOOKDYHORVWKDOIKLVZRUNHUEHHVDWDVLQJOHVWURNH,IKRZHYHUKHFDQXVHWKHVZDUPLQJ
LPSXOVHWREUHHGDQHZTXHHQEXWNHHSDOOWKHEHHVLQWKHFRORQ\WRJHWKHUKHZLOOPD[LPL]H
KLVFKDQFHVRIDJRRGKDUYHVW,WWDNHVPDQ\\HDUVRIOHDUQLQJDQGH[SHULHQFHWREHDEOHWR
PDQDJH DOO WKHVH DVSHFWV VXFFHVVIXOO\ WKRXJK RZLQJ WR YDULDEOH FLUFXPVWDQFHV PDQ\
EHJLQQHUVZLOORIWHQDFKLHYHDJRRGKRQH\KDUYHVW

)RUPDWLRQRIQHZFRORQLHV

&RORQ\UHSURGXFWLRQVZDUPLQJDQGVXSHUVHGXUH
$OOFRORQLHVDUHWRWDOO\GHSHQGHQWRQWKHLUTXHHQZKRLVWKHRQO\HJJOD\HU+RZHYHU
HYHQWKHEHVWTXHHQVOLYHRQO\DIHZ\HDUVDQGRQHRUWZR\HDUVORQJHYLW\LVWKHQRUP6KH
FDQFKRRVHZKHWKHURUQRWWRIHUWLOL]HDQHJJDVVKHOD\VLWLIVKHGRHVVRLWGHYHORSVLQWRD
IHPDOH ZRUNHU EHH LI VKH OD\V DQ XQIHUWLOL]HG HJJ LW EHFRPHV D PDOH GURQH 6KH GHFLGHV
ZKLFKW\SHRIHJJWROD\GHSHQGLQJRQWKHVL]HRIWKHRSHQEURRGFHOOZKLFKVKHHQFRXQWHUV
RQWKHFRPELQDVPDOOZRUNHUFHOOVKHOD\VDIHUWLOL]HGHJJLIVKHILQGVDPXFKODUJHUGURQH
FHOOVKHOD\VDQXQIHUWLOL]HGGURQHHJJ
$OO WKH WLPH WKDW WKH TXHHQ LV IHUWLOH DQG OD\LQJ HJJV VKH SURGXFHV D YDULHW\ RI
SKHURPRQHVZKLFKFRQWUROWKHEHKDYLRURIWKHEHHVLQWKHKLYHWKHVHDUHFRPPRQO\FDOOHG
TXHHQ VXEVWDQFH  EXW LQ UHDOLW\ WKHUH DUH YDULRXV GLIIHUHQW SKHURPRQHV ZLWK GLIIHUHQW
IXQFWLRQV $V WKH TXHHQ DJHV VKH EHJLQV WR UXQ RXW RI VWRUHG VSHUP DQG KHU SKHURPRQHV
EHJLQWRIDLO$WVRPHSRLQWLQHYLWDEO\WKHTXHHQEHJLQVWRIDOWHUDQGWKHEHHVZLOOGHFLGHWR
UHSODFHKHUE\FUHDWLQJDQHZTXHHQIURPRQHRIKHUZRUNHUHJJV7KH\PD\GRWKLVEHFDXVH
VKH KDV EHHQ GDPDJHG ORVW D OHJ RU DQ DQWHQQD  EHFDXVH VKH KDV UXQ RXW RI VSHUP DQG
FDQQRWOD\ IHUWLOL]HGHJJV KDV EHFRPHD GURQH OD\LQJTXHHQ  RU EHFDXVH KHU SKHURPRQHV
KDYHGZLQGOHGWRDSRLQWZKHUHWKH\FDQQRWFRQWURODOOWKHEHHVLQWKHKLYHDQ\PRUH
$WWKLVMXQFWXUHWKHEHHVZLOOSURGXFHRQHRUPRUHTXHHQFHOOVE\PRGLI\LQJH[LVWLQJ
ZRUNHUFHOOVZKLFKFRQWDLQDQRUPDOIHPDOHHJJ+RZHYHUWKHUHDUHWZRGLVWLQFWEHKDYLRUV
ZKLFKWKHEHHVSXUVXH

x 6XSHUVHGXUHTXHHQUHSODFHPHQWZLWKLQRQHKLYHZLWKRXWVZDUPLQJ
x 6ZDUPFHOOSURGXFWLRQWKHGLYLVLRQRIWKHKLYHLQWRWZRFRORQLHVE\VZDUPLQJ

'LIIHUHQW VXEVSHFLHV RI $SLV PHOOLIHUD H[KLELW GLIIHULQJ VZDUPLQJ FKDUDFWHULVWLFV

ZKLFKUHIOHFWWKHLUHYROXWLRQLQGLIIHUHQWHFRWRSHVRIWKH(XURSHDQFRQWLQHQW,QJHQHUDOWKH
PRUH QRUWKHUO\ EODFN UDFHV DUH VDLG WR VZDUP OHVV DQG VXSHUVHGH PRUH ZKHUHDV WKH PRUH
VRXWKHUO\ \HOORZ DQG JUH\ YDULHWLHV DUH VDLG WR VZDUP PRUH IUHTXHQWO\ 7KH WUXWK LV
FRPSOLFDWHG EHFDXVH RI WKH SUHYDOHQFH RI FURVVEUHHGLQJ DQG K\EULGL]DWLRQ RI WKH VXE
VSHFLHVDQGRSLQLRQVGLIIHU
6XSHUVHGXUH LV KLJKO\ YDOXHG DV D EHKDYLRUDO WUDLW E\ EHHNHHSHUV EHFDXVH D KLYHWKDW
VXSHUVHGHV LWV ROG TXHHQ GRHV QRW VZDUP DQG VR QR VWRFN LV ORVW LW PHUHO\ FUHDWHV D QHZ

ϯϴϰ

 TXHHQDQGDOORZVWKHROGRQHWRIDGHDZD\RUDOWHUQDWLYHO\VKHLVNLOOHGZKHQWKHQHZTXHHQ
HPHUJHV :KHQ VXSHUVHGLQJ D TXHHQ WKH EHHV ZLOO SURGXFH MXVW RQH RU WZR TXHHQ FHOOV
FKDUDFWHULVWLFDOO\LQWKHFHQWHURIWKHIDFHRIDEURRGFRPE )LJXUH 
,QVZDUPLQJE\ FRQWUDVW D JUHDW PDQ\ TXHHQ FHOOVDUHFUHDWHGW\SLFDOO\DGR]HQRU
PRUHDQGWKHVHDUHORFDWHGDURXQGWKHHGJHVRIDEURRGFRPEPRVWRIWHQDWWKHVLGHVDQGWKH
ERWWRP



)LJXUH1HZZD[FRPEVEHWZHHQEDVHPHQWMRLVWV
2QFH HLWKHU SURFHVV KDV EHJXQ WKH ROG TXHHQ ZLOO QRUPDOO\ OHDYH WKH KLYH ZLWK WKH
KDWFKLQJRIWKHILUVWTXHHQFHOOV:KHQVKHOHDYHVWKHKLYHWKHROGTXHHQLVDFFRPSDQLHGE\
DODUJHQXPEHURIEHHVSUHGRPLQDQWO\\RXQJEHHV ZD[VHFUHWHUV ZKRZLOOIRUPWKHEDVLV
RI WKH QHZ KLYH 6FRXWV DUH VHQWRXWIURP WKH VZDUP WR ILQG VXLWDEOH KROORZ WUHHV RU URFN
FUHYLFHV DQGDV VRRQDVRQH LVIRXQG WKHHQWLUH VZDUP PRYHV LQ EXLOGLQJ QHZ ZD[ EURRG
FRPEV ZLWKLQ D PDWWHU RI KRXUV XVLQJ WKH KRQH\ VWRUHV ZKLFK WKH \RXQJ EHHV KDYH ILOOHG
WKHPVHOYHVZLWKEHIRUHOHDYLQJWKHROGKLYH2QO\\RXQJEHHVFDQVHFUHWHZD[IURPVSHFLDO
DEGRPLQDOVHJPHQWVDQGWKLVLVZK\WKHUHWHQGVWREHPRUH\RXQJEHHVWKDQROGLQVZDUPV
2IWHQDQXPEHURIYLUJLQTXHHQVDFFRPSDQ\WKHILUVWVZDUP WKH SULPHVZDUP DQGWKHROG
TXHHQLVUHSODFHGDVVRRQDVDGDXJKWHUTXHHQLVPDWHGDQGOD\LQJ2WKHUZLVHVKHZLOOEH
TXLFNO\VXSHUVHGHGLQWKHLUQHZKRPH

)DFWRUVWKDWWULJJHUVZDUPLQJ
,WLVJHQHUDOO\DFFHSWHGWKDWDFRORQ\RIEHHVZLOOQRWVZDUPXQWLOLWKDVFRPSOHWHGDOO
LWVEURRGFRPEVLH ILOOHG DOODYDLODEOH VSDFH ZLWK HJJVODUYDHDQGEURRG7KLV JHQHUDOO\
RFFXUVLQODWHVSULQJDWDWLPHZKHQWKHRWKHUDUHDVRIWKHKLYHDUHUDSLGO\ILOOLQJZLWKKRQH\
VWRUHV6RRQHNH\WULJJHURIWKHVZDUPLQJLQVWLQFWLVZKHQWKHTXHHQKDVQRPRUHURRPWR
OD\ HJJV DQG WKH KLYH SRSXODWLRQ LV EHFRPLQJ YHU\ FRQJHVWHG 8QGHU WKHVH FRQGLWLRQV D
SULPHVZDUPPD\LVVXHZLWKWKHTXHHQUHVXOWLQJLQDKDOYLQJRIWKHSRSXODWLRQZLWKLQWKH
KLYHDQGOHDYLQJWKHROGFRORQ\ZLWKDODUJHDPRXQWRIKDWFKLQJEHHV7KHTXHHQZKROHDYHV
ILQGV KHUVHOI LQ D QHZ KLYH ZLWK QR HJJV QR ODUYDH EXW ORWV RI HQHUJHWLF \RXQJ EHHV ZKR
FUHDWHDQHZVHWRIEURRGFRPEVIURPVFUDWFKLQDYHU\VKRUWWLPH
$QRWKHULPSRUWDQWIDFWRULQVZDUPLQJLVWKHDJHRIWKHTXHHQ7KRVHXQGHUD\HDULQ
DJH DUH XQOLNHO\ WR VZDUP XQOHVV WKH\ DUH H[WUHPHO\ FURZGHG ZKLOH ROGHU TXHHQV KDYH
VZDUPLQJSUHGLVSRVLWLRQ

ϯϴϱ

 %HHNHHSHUVPRQLWRUWKHLUFRORQLHVFDUHIXOO\LQVSULQJDQGZDWFKIRUWKHDSSHDUDQFHRI
TXHHQFHOOVZKLFKDUHDGUDPDWLFVLJQDOWKDWWKHFRORQ\LVGHWHUPLQHGWRVZDUP
:KHQDFRORQ\KDVGHFLGHGWRVZDUPTXHHQFHOOVDUHSURGXFHGLQQXPEHUVYDU\LQJWR
DGR]HQRUPRUH:KHQWKHILUVWRIWKHVHTXHHQFHOOVLVVHDOHGDIWHUGD\VRIODUYDOIHHGLQJ
DYLUJLQTXHHQZLOOSXSDWHDQGEHGXHWRHPHUJHVHYHQGD\VDIWHUVHDOLQJ%HIRUHOHDYLQJWKH
ZRUNHU EHHV ILOO WKHLU VWRPDFKV ZLWK KRQH\ LQ SUHSDUDWLRQ IRU WKH FUHDWLRQ RI QHZ
KRQH\FRPEVLQDQHZKRPH7KLVFDUJRRIKRQH\DOVRPDNHVVZDUPLQJEHHVOHVVLQFOLQHGWR
VWLQJDQGDQHZO\LVVXHGVZDUPLVQRWLFHDEO\JHQWOHIRUXSWRKRXUV²RIWHQFDSDEOHRI
EHLQJKDQGOHGZLWKRXWJORYHVRUYHLOE\DEHHNHHSHU


)LJXUH$VZDUPDWWDFKHGWRDEUDQFK
7KLV VZDUP )LJXUH   LV ORRNLQJ IRU VKHOWHU $ EHHNHHSHU PD\ FDSWXUH LW DQG
LQWURGXFHVLWLQWRDQHZKLYH KHOSLQJ WR PHHW WKLV QHHG 2WKHUZLVHLWZLOOUHWXUQWRDIHUDO
VWDWH LQ ZKLFK FDVH LW ZLOO ILQG VKHOWHU LQ D KROORZ WUHH DQ H[FDYDWLRQ DQ DEDQGRQHG
FKLPQH\RUHYHQEHKLQGVKXWWHUV
%DFN DW WKH RULJLQDO KLYH WKH ILUVW YLUJLQ TXHHQ WR HPHUJH IURP KHU FHOO ZLOO
LPPHGLDWHO\VHHNRXWWRNLOODOOKHUULYDOTXHHQVZKRDUHVWLOOZDLWLQJWRHPHUJHIURPWKHLU
FHOOV+RZHYHUXVXDOO\WKHEHHVGHOLEHUDWHO\SUHYHQWKHUIURPGRLQJWKLVLQZKLFKFDVHVKH
WRRZLOOOHDGDVHFRQGVZDUPIURPWKHKLYH6XFFHVVLYHVZDUPVDUHFDOOHG DIWHUVZDUPV RU
FDVWV DQGFDQEHYHU\VPDOORIWHQZLWKMXVWDWKRXVDQGRUVREHHVDVRSSRVHGWRDSULPH
VZDUPZKLFKPD\FRQWDLQDVPDQ\DVWHQWRWZHQW\WKRXVDQGEHHV
6PDOO DIWHUVZDUPV KDYH OHVV FKDQFH RI VXUYLYDO DQG PD\ GHSOHWH WKH RULJLQDO KLYH
WKUHDWHQLQJ LWV VXUYLYDO DV ZHOO :KHQ D KLYH KDV VZDUPHG GHVSLWH WKH EHHNHHSHU V
SUHYHQWDWLYH HIIRUWV D JRRG PDQDJHPHQW SUDFWLFH LV WR JLYH WKH GHSOHWHG KLYH D FRXSOH
IUDPHV RI RSHQ EURRG ZLWK HJJV 7KLV KHOSV UHSOHQLVK WKH KLYH PRUH TXLFNO\ DQG JLYHV D
VHFRQGRSSRUWXQLW\WRUDLVHDTXHHQLIWKHUHLVDPDWLQJIDLOXUH
(DFK UDFH RU VXEVSHFLHV RI KRQH\EHH KDV LWV RZQ VZDUPLQJ FKDUDFWHULVWLFV ,WDOLDQ
EHHVDUH YHU\SUROLILFDQGLQFOLQHGWRVZDUP1RUWKHUQ(XURSHDQEODFN EHHV KDYH D VWURQJ
WHQGHQF\WRVXSHUVHGHWKHLUROGTXHHQZLWKRXWVZDUPLQJ7KHVHGLIIHUHQFHVDUHWKHUHVXOWRI
GLIIHULQJHYROXWLRQDU\SUHVVXUHVLQWKHUHJLRQVZKHUHHDFKVXEVSHFLHVHYROYHG

$UWLILFLDOVZDUPLQJ
:KHQ DFRORQ\ DFFLGHQWDOO\ ORVHV LWV TXHHQ LW LV VDLG WR EH TXHHQOHVV  7KH ZRUNHUV
UHDOL]HWKDWWKHTXHHQLVDEVHQWDIWHUDVOLWWOHDVDQKRXUDVKHUSKHURPRQHVIDGHLQWKHKLYH

ϯϴϲ

 7KHFRORQ\FDQQRWVXUYLYHZLWKRXW DIHUWLOHTXHHQOD\LQJHJJVWRUHQHZWKHSRSXODWLRQ6R
WKH ZRUNHUV VHOHFW FHOOV FRQWDLQLQJ HJJV DJHG OHVV WKDQ WKUHH GD\V DQG HQODUJH WKHVH FHOOV
GUDPDWLFDOO\ WR IRUP HPHUJHQF\ TXHHQ FHOOV  7KHVH DSSHDU VLPLODU WR ODUJH SHDQXWOLNH
VWUXFWXUHDERXWDQLQFKORQJZKLFKKDQJVIURPWKHFHQWHURUVLGHRIWKHEURRGFRPEV7KH
GHYHORSLQJODUYDLQDTXHHQFHOOLVIHGGLIIHUHQWO\IURPDQRUGLQDU\ZRUNHUEHHUHFHLYLQJLQ
DGGLWLRQWRWKHQRUPDOKRQH\DQGSROOHQDJUHDWGHDORIUR\DOMHOO\DVSHFLDOIRRGVHFUHWHGE\
\RXQJ QXUVHEHHV IURPWKHK\SRSKDU\QJHDOJODQG7KLVVSHFLDOIRRGGUDPDWLFDOO\DOWHUVWKH
JURZWKDQGGHYHORSPHQWRIWKHODUYDVRWKDWDIWHUPHWDPRUSKRVLVDQGSXSDWLRQLWHPHUJHV
IURP WKH FHOO DV D TXHHQ EHH 7KH TXHHQ LV WKH RQO\ EHH LQ D FRORQ\ ZKLFK KDV IXOO\
GHYHORSHGRYDULHVDQGVKHVHFUHWHVDSKHURPRQHZKLFKVXSSUHVVHVWKHQRUPDOGHYHORSPHQW
RIRYDULHVLQDOOKHUZRUNHUGDXJKWHUV
%HHNHHSHUV XVH WKH DELOLW\ RI WKH EHHV WR SURGXFH QHZ TXHHQV WR LQFUHDVH WKHLU
FRORQLHVDSURFHGXUHFDOOHGVSOLWWLQJDFRORQ\7RGRWKLVWKH\UHPRYHVHYHUDOEURRGFRPEV
IURPDKHDOWK\KLYHWDNLQJFDUHWKDWWKHROGTXHHQLVOHIWEHKLQG7KHVHFRPEVPXVWFRQWDLQ
HJJVRUODUYDHOHVVWKDQWKUHHGD\VROGZKLFKZLOOEHFRYHUHGE\\RXQJ QXUVHEHHV ZKLFK
FDUHIRUWKHEURRGDQGNHHSLWZDUP7KHVHEURRGFRPEVDQGDWWHQGDQWQXUVHEHHVDUHWKHQ
SODFHGLQWRDVPDOO QXFOHXVKLYH DORQJZLWKRWKHUFRPEVFRQWDLQLQJKRQH\DQGSROOHQ$V
VRRQDVWKHQXUVHEHHVILQGWKHPVHOYHVLQWKLVQHZKLYHDQGUHDOLVHWKDWWKH\KDYHQRTXHHQ
WKH\VHWDERXWFRQVWUXFWLQJHPHUJHQF\TXHHQFHOOVXVLQJWKHHJJVRUODUYDHZKLFKWKH\KDYH
LQWKHFRPEVZLWKWKHP

'LVUXSWLRQRIYLWHOORJHQLQJHQHIXQFWLRQLQDGXOWKRQH\EHHV

'XHWRLWVVRFLDODWWULEXWHVLWVOHDUQLQJFDSDELOLWLHVDQGVHYHUDOIDFXOWDWLYHSK\VLRORJLFDO
DQG EHKDYLRXUDO WUDLWV XQGHU VRFLDO FRQWURO WKH KRQH\EHH $SLV PLOOLIHUD  SURYLGH XQLTXH
RSSRUWXQLWLHV DV D PRGHO V\VWHP 7KH KRQH\EHH KDV D ULFK KLVWRU\ DV DQ H[SHULPHQWDO
RUJDQLVPDQG LW LV QRZ UHFHLYLQJ LQFUHDVHG DWWHQWLRQFRQFHUQLQJ JHQHUDOLVVXHV VXFKDVWKH
PROHFXODUEDVLVRIOHDUQLQJDQGPHPRU\JHQHUDWLRQWKHUHJXODWLRQRIDJHLQJWKHUHJXODWRU\
DQDWRP\ RI VRFLDO V\VWHPV DQG WKH HYROXWLRQ RI FRPSOH[ VRFLDO V\VWHPV WKURXJK VHOI
RUJDQL]DWLRQ HPHUJHQFH DQG PXOWLOHYHO QDWXUDO VHOHFWLRQ 7KH DELOLW\ WR PDQLSXODWH WKH
JHQHWLFV XQGHUO\LQJ WKH SK\VLRORJLFDO DQG EHKDYLRXUDO UHSHUWRLUHV RI WKH DGXOW KRQH\EHH
ZRUNHU ZLOO EHFRPH LQVWUXPHQWDO IRU XQGHUVWDQGLQJ WKH DERYH LVVXHV +RZHYHU WKHUH LV
FXUUHQWO\QRHVWDEOLVKHGPHWKRGIRUGRLQJFOHDUFXWUHYHUVHJHQHWLFVRQDGXOWEHHV

2QHUHFHQWDQGYHU\SURPLVLQJPHWKRGIRUWDUJHWHGGRZQUHJXODWLRQRIJHQHH[SUHVVLRQ
LQ D ZLGH UDQJH RI RUJDQLVPV LV 51$L 51$L LV WKH SURFHVV E\ ZKLFK GV51$ LQKLELWV WKH
DFFXPXODWLRQ RI KRPRORJRXV WUDQVFULSWV IURP FRJQDWH JHQHV 51$L KDV HYROYHG LQWR D
SRZHUIXO WRRO IRU SURELQJ JHQH IXQFWLRQ LQ 'URVRSKLOD 7ULEROLXP &DHQRUKDEGLWLV HOHJDQV
DQGPLFH,QKRQH\EHHVPLFURLQMHFWLRQLQSUHEODVWRGHUPHJJVXVLQJGV51$GHULYHGIURPD
ESVWUHWFKRIWKHHQJUDLOHGKRPHRER[PRWLIGLVUXSWVH[SUHVVLRQRIWKHWDUJHWJHQHGXULQJ
HPEU\R GHYHORSPHQW 7KH DGXOW KRQH\EHH JHQH H[SUHVVLRQH[HPSOLILHGE\ WKH JHQH FRGLQJ
IRUWKHOLSRSURWHLQYLWHOORJHQLQFDQEHVSHFLILFDOO\LQKLELWHGE\PLFURLQMHFWLRQRIGV51$LQWR
KRQH\EHHHPEU\RVDVZHOODVE\LQWUDDEGRPLQDOLQMHFWLRQRIDGXOWEHHV

7KH YLWHOORJHQLQ JHQH ZDV FKRVHQ EHFDXVH LWV H[SUHVVLRQ LV XQOLNHO\ WR KDYH D
SKHQRW\SLF HIIHFW XQWLO WKH DGXOW VWDJH LQ EHHV 7KH YLWHOORJHQLQ SURWHLQ LV SURGXFHG E\ WKH
DGXOWLQVHFWIDW ERG\ZKLFKLQKRQH\EHHVFRQVLVWVRI WKLQOD\HUV RIFHOOV VSUHDGDJDLQVW WKH
ERG\ ZDOO RI WKH DEGRPHQ 9LWHOORJHQLQ LV QRUPDOO\ VHFUHWHG LQWR WKH KHPRO\PSK RI
UHSURGXFWLYHIHPDOHVEHIRUHWUDQVSRUWLQWRGHYHORSLQJRRF\WHV+RZHYHUWKHVWHULOHKRQH\EHH

ϯϴϳ

ZRUNHUV PD\ KDYH KLJK KHPRO\PSK WLWUHV RI WKLV SURWHLQ 9LWHOORJHQLQ P51$ LV SUHVHQW LQ
WKH IDW ERG\ RI EHHV   KRXUV ROG ZKLOH WKH OHYHO RI FRUUHVSRQGLQJ SURWHLQ LQ WKH
KHPRO\PSKLVXQGHWHFWDEOHDWWKLVDJH7KHH[SUHVVLRQWKHQLQFUHDVHVDQGWKHOHYHORIP51$
LVFRQVWDQWLQWKHDJHLQWHUYDORI±GD\V'XULQJWKLVSHULRGWKHLQGLYLGXDOYLWHOORJHQLQWLWUH
PD\ YDU\ JUHDWO\ 7KLV YDULDWLRQ PD\ EH GXH WR LQGLYLGXDO GLIIHUHQFHV LQ WKH UDWH DW ZKLFK
YLWHOORJHQLQLVFRQVXPHG IRUPHWDEROLF SXUSRVHV (TXDO SURGXFWLRQUDWHVZRXOGLQWKLVFDVH
JLYH ULVH WR YDULDEOH WLWUHV +RZHYHU WKH SKHQRPHQRQ PLJKW DOVR UHIOHFW LQGLYLGXDO
GLIIHUHQFHVLQQXWULWLRQDO VWDWXV DV WKH YLWHOORJHQLQ SURGXFWLRQLVVWURQJO\GHSHQGHQWRQWKH
DYDLODELOLW\RISURWHLQDFHRXVIRRG

,Q DQ\ FDVH WKH YLWHOORJHQLQ WLWUH LV QRW DQ XQDPELJXRXV DVVD\ IRU GHWHFWLQJ 51$L
+RZHYHUDV WKH IUHTXHQF\ RIFRQWUROV ZLWK QHJOLJLEOH YLWHOORJHQLQ WLWUHV LV ORZ   RI DOO
FRQWUROV DJHG ± GD\V 1    LW LV ODERXUVDYLQJ WR XVH LW IRU GHWHFWLQJ SRWHQWLDO
NQRFNGRZQ SKHQRW\SHV   1    RI WKH DGXOW EHHV UHDUHG IURP HJJV LQMHFWHG ZLWK
GV51$ KDG VWURQJO\ UHGXFHG OHYHOV RI YLWHOORJHQLQ P51$ 7KH GLVUXSWLRQ DSSHDUHG WR EH
LQFRPSOHWH LQ VRPH LQGLYLGXDOV EXW WKH 51$L HIIHFW ZDV GHWHFWDEOH DW HPHUJHQFH DQG
SHUVLVWHQWRYHUGD\V,QWKHLQWUDDEGRPLQDOO\LQMHFWHGJURXS 1  VKRZHGORVV
RIYLWHOORJHQLQP51$H[SUHVVLRQZKHQVDPSOHGDWGD\VROG)XUWKHUPRUHDQXQDPELJXRXV
IUDJPHQWZLWKDQDSSDUHQWVL]HVLPLODUWRWKHWHPSODWHGV51$ ES ZDVYLVXDOL]HGLQDOO
DGXOW LQMHFWHG EHHV ZLWK D PXWDQW SKHQRW\SH 6DPSOHV HQULFKHG ZLWK VKRUW 51$ VKRZ WKDW
YLWHOORJHQLQP51$IUDJPHQWVDVVPDOODVESFRXOGEHGHWHFWHG)RUDOOPXWDQWVWKHOHYHO
RI YLWHOORJHQLQ LQ WKH KHPRO\PSK ZDV DOPRVW XQGHWHFWDEOH 5HGXFHG OHYHOV RI YLWHOORJHQLQ
P51$ ZDV QRW HQFRXQWHUHG LQ DQ\ RI WKH FRQWURO LQGLYLGXDOV DVVD\HG LQ WKLV PDQQHU 1 
 

9LWHOORJHQLQ LV D IHPDOH VSHFLILF JOXFROLSRSURWHLQ \RON SUHFXUVRU SURGXFHG E\ DOO
RYLSDURXV DQLPDOV ,QYHUWHEUDWH DQG YHUWHEUDWH YLWHOORJHQLQV FRQVWLWXWH D PXOWLJHQH
VXSHUIDPLO\WRJHWKHUZLWKLQVHFWDSROLSRSKRULQ,,,KXPDQDSROLSRSURWHLQ% DSR% DQG
WKH ODUJH VXEXQLW RI PDPPDOLDQ PLFURVRPDO WULJO\FHULGH WUDQVIHU SURWHLQ 073  ,W LV
JHQHUDOO\V\QWKHVL]HGLQODUJHDPRXQWVGLUHFWO\SULRUWR\RONGHSRVLWLRQDQGLVRIIXQGDPHQWDO
LPSRUWDQFH LQ UHSURGXFWLRQ $V YLWHOORJHQLQ LV DOVR V\QWKHVL]HG E\ WKH IXQFWLRQDOO\ VWHULOH
ZRUNHUV LW KDV EHHQ VXVSHFWHG IRU VRPH WLPH WKDW YLWHOORJHQLQ KDV IXQFWLRQV RWKHU WKDQ
UHSURGXFWLRQLQKRQH\EHHV,WZDVUHFHQWO\VKRZQWKDWQXUVHEHHVXVHYLWHOORJHQLQWRSURGXFH
UR\DOMHOO\)XUWKHUPRUHYLWHOORJHQLQVHUYHVLPSRUWDQWIXQFWLRQVUHODWHGWRLPPXQHIXQFWLRQ
DQGORQJHYLW\$VWKHDPRXQWRIYLWHOORJHQLQP51$LQWKHKRQH\EHHZRUNHULVFRQVLGHUDEOH
LWFDQEHVXJJHVWHGWKDW51$LFDQEHXVHGWRDOVRNQRFNGRZQDEXQGDQWO\H[SUHVVHGJHQHV

,W FDQQRWEHH[FOXGHG WKDW WKH REVHUYHG KLJK HIILFDF\ RIWKHLQWUDDEGRPLQDOLQMHFWLRQ
WHFKQLTXH IRU LQKLELWLQJ YLWHOORJHQLQ H[SUHVVLRQ LV GXH WR WKH VWUXFWXUH DQG IXQFWLRQ RI WKH
KRQH\EHHIDWERG\:KHQGV51$LVLQMHFWHGLQWRWKHKRQH\EHHDEGRPHQWKHIDWERG\WLVVXH
LV UHDGLO\ H[SRVHG )XUWKHUPRUH WKH IDW ERG\ SOD\V DQ LPPXQRORJLFDO UROH WKDW LQFOXGHV
XSWDNHRISRWHQWLDOO\KDUPIXOPDFURPROHFXOHVIURPWKHKHPRO\PSKLQPDQ\ZD\VDQDORJRXV
WRWKHPDPPDOLDQOLYHU7KHREVHUYHGHIILFDF\PD\WKXVQRWEHUHSUHVHQWDWLYHIRUJHQHVEHLQJ
H[SUHVVHGLQRWKHURUJDQVRUWLVVXHVLQWKHDGXOWEHH

+RZHYHU LW LV SURPLVLQJ WKDW WKLV GRHV QRW VHHP WR EH WKH FDVH LQ 'URVRSKLOD
PHODQRJDVWHU,QWUDDEGRPLQDOLQMHFWLRQVRIKRPRORJRXVGV51$LQWKLVVSHFLHVVLOHQFHODF=
WUDQVJHQHH[SUHVVLRQLQWKHJXWDVZHOODVLQWKHRSWLFDQGDQWHQQDOOREHVDQGWKDWWKHPHWKRG
LV SRWHQW LQ VLOHQFLQJ HQGRJHQRXV *0 P51$ LQ WKH FHQWUDO QHUYRXV V\VWHP (YHQ
WKRXJK WKH VFRSH RI WKLV WHFKQLTXH VKRXOG WXUQ RXW WR EH PRUH UHVWULFWHG LQ KRQH\EHHV

ϯϴϴ

VXJJHVWVWKDWDQXPEHURILPSRUWDQWJHQHVEHLQJH[SUHVVHGLQWKHIDWERG\FDQEHWDUJHWHGWKLV
ZD\

$OWHUQDWLYHO\LWPD\DOVREHWKDWWKHFDSDFLW\RIWKHIDWERG\IRUWDNLQJXSSRWHQWLDOO\
KDUPIXOPDFURPROHFXOHVIURPWKHKHPRO\PSKLVLQGHHGWKHNH\IRUWDUJHWLQJRWKHUWLVVXHVE\
LQWUDDEGRPLQDOLQMHFWLRQRIGV51$,IWKLVGV51$LVSURFHVVHGLQWRVPDOOLQWHUIHULQJ51$
VL51$ RUDQRWKHUPRELOHVLJQDOWKDWLVH[SRUWHGWRWKHKHPRO\PSKWKLVZRXOGPDNHWKHIDW
ERG\ D VRXUFH RI PRELOH VLOHQFLQJ DJHQWV WKDW SUREDEO\ FRXOG EH PRUH HDVLO\ WDNHQ XS E\
RWKHU WLVVXHV 0LFURLQMHFWLRQV LQ WKH DGXOW KRQH\EHH EUDLQ XVLQJ GV51$ KRPRORJRXV WR
ELRJHQLFDPLQHUHFHSWRUVUHVXOWVLQLQFRPSOHWHNQRFNGRZQRIWKHWDUJHWJHQHDUHFRQVLVWHQW
ZLWK WKLV H[SODQDWLRQ ,I WKLV VXJJHVWLRQ LV FRUUHFW WKH LQWUDDEGRPLQDO LQMHFWLRQ WHFKQLTXH
PD\EHVXSHULRUWRLQMHFWLQJGV51$ GLUHFWO\ LQWRDWDUJHWWLVVXHERWKEHFDXVHRIWKHDFWXDO
PHFKDQLVP DQG WKH IDFW WKDW WKH WHFKQLTXH DOORZV LQMHFWLRQ RI PXFK KLJKHU DPRXQWV RI
GV51$ZLWKRXWKDUPLQJWKHLQGLYLGXDO

9LWHOORJHQLQWXUQRXWWREHUHSUHVHQWDWLYHIRUODUJHQXPEHURIJHQHVEHLQJH[SUHVVHGLQ
YDULRXVWLVVXHVRIWKHDGXOWKRQH\EHHWKHLQWUDDEGRPLQDOLQMHFWLRQWHFKQLTXHSURYLGHVDZD\
WRGRIXQFWLRQDOJHQRPLFVVWXGLHVRQDGXOWKRQH\EHHVE\YHU\VLPSOHPHDQV7KHWHFKQLTXH
FDQ EH FRQVLGHUHG WR EH FRQGLWLRQDO WR WKH H[WHQW WKDW DGXOW EHHV FDQ EH H[SRVHG WR WKH
GV51$,WDOORZVJURXSVRIJHQHVWREHVLPXOWDQHRXVO\UHQGHUHGLQHIIHFWLYHZLWKRXWWKHQHHG
IRUWLPHFRQVXPLQJFURVVHVDQGLWPD\HYHQDOORZVHTXHQWLDOWDUJHWHGGLVUXSWLRQWKDWPLJKW
WXUQRXWWREHFUXFLDOIRUXQGHUVWDQGLQJFHUWDLQW\SHVRIUHJXODWRU\VWUXFWXUHV7KHWHFKQLTXH
FDQHDVLO\EHH[WHQGHGWRLQFOXGHGHOLYHU\RIVL51$+LJKSUHVVXUHLQMHFWLRQRIVL51$LQWR
WKHWDLOYHLQRISRVWQDWDOPLFHKDVUHFHQWO\SURYHQWREHKLJKO\HIILFLHQWIRUVSHFLILFLQKLELWLRQ
RIWUDQVJHQHH[SUHVVLRQLQDYDULHW\RIRUJDQV$VXVHRIVL51$VHHPVWREHDPHDQVWRWDUJHW
VSHFLILF LVRIRUPV LQ 'URVRSKLOD DQG WR HQVXUH D PRGHUDWH ORQJHYLW\ RI 51$L LQ PLFH
GHOLYHU\ RI VL51$ E\ LQWUDDEGRPLQDO LQMHFWLRQ PD\ SURYLGH DGGLWLRQDO SRVVLELOLWLHV IRU
WHPSRUDODQGVSDWLDOFRQWURORI51$LLQDGXOWZRUNHUV

6VXEVWDQWLDO 51$L LQ DGXOWV REWDLQHG IURP HJJV LQMHFWHG ZLWK GV51$ DW WKH
SUHEODVWRGHUPVWDJHWKLVLQMHFWLRQPHWKRGVHHPVWRSURYLGHDPHDQVWRGLVUXSWJHQHIXQFWLRQ
LQWKHHPEU\RQLFODUYDODQGSXSDOVWDJHV+RZHYHULQWUDDEGRPLQDOLQMHFWLRQRI GV51$LQ
DGXOWVLVKLJKO\VXSHULRUWRHJJLQMHFWLRQIRUVSHFLILFGLVUXSWLRQRIJHQHIXQFWLRQLQWKHDGXOW
VWDJH 7KH LQWUDDEGRPLQDO LQMHFWLRQ WHFKQLTXH LV PXFK PRUH HIILFLHQW ,W LV VXEVWDQWLDOO\
VLPSOHUDQGLWPDNHVLWSRVVLEOHWRVSHFLILFDOO\DGGUHVVJHQHIXQFWLRQLQDGXOWVHYHQLQWKRVH
FDVHVZKHUHWKHIRFDOJHQHLVDOVRH[SUHVVHGLQWKHHPEU\RQLFODUYDORUSXSDOVWDJHV


5HIHUHQFHV

)ULHGPDQ0DWWLH$UFKDHRORJLVWV'LVFRYHU$QFLHQW%HHKLYHV :HEDUWLFOH /LYH6FLHQFH

KWWSZZZOLYHVFLHQFHFRPDQLPDOVBDSBDQFLHQWBEHHKLYHKWPO

*UHJRU\ 3DP %HWWHU EHHNHHSLQJ LQ WRSEDU KLYHV :HE DUWLFOH  %HHV )RU 'HYHORSPHQW
KWWSZZZEHHVIRUGHYHORSPHQWRUJLQIRLQIRWRSEDUEHWWHUEHHNHHSLQJLQWRSEVKWPO

3URGXFWLRQDQG9DOXHRI+RQH\DQG0DSOH3URGXFWV

7KH GHILQLWLYH ERRN RQ WKH KLVWRU\ RI EHHNHHSLQJ LV 7KH :RUOG +LVWRU\ RI %HHNHHSLQJ DQG
+RQH\+XQWLQJE\(YD&UDQH5RXWOHGJHSS

ϯϴϵ

7KRPDV:LOGPDQ$7UHDWLVHRQWKH0DQDJHPHQWRI%HHV /RQGRQQGHGQ 

7UD\QRU .LUVWHQ $QFLHQW FDYH SDLQWLQJ 0DQ RI %LFRUS :HE DUWLFOH  0' %HH
KWWSZZZPGEHHFRPDUWLFOHVFDYHSDLQWLQJKWPO

:LOGPDQRSFLWQG  HGDWSS

:LOGPDQRSFLWQG  HGDWSS

ϯϵϬ

 &KDSWHU
3HDUO&XOWXUH
3HDUO
$ SHDUO LV D KDUG JHQHUDOO\ VSKHULFDO REMHFW SURGXFHG ZLWKLQ WKH VRIW WLVVXH
VSHFLILFDOO\WKHPDQWOH RIDOLYLQJVKHOOHGPROOXVN-XVWOLNHWKHVKHOORIDPROOXVNDSHDUO
LV PDGH XS RI FDOFLXP FDUERQDWH LQ PLQXWH FU\VWDOOLQH IRUP ZKLFK KDV EHHQ GHSRVLWHG LQ
FRQFHQWULFOD\HUV7KHLGHDOSHDUOLVSHUIHFWO\URXQGDQGVPRRWKEXW PDQ\RWKHUVKDSHVRI
SHDUOV RFFXU 7KH ILQHVW TXDOLW\ QDWXUDO SHDUOV KDYH EHHQ KLJKO\ YDOXHG DV JHPVWRQHV DQG
REMHFWV RI EHDXW\ IRU PDQ\ FHQWXULHV DQG EHFDXVH RI WKLV WKH ZRUG SHDUO KDV EHFRPH D
PHWDSKRUIRUVRPHWKLQJYHU\UDUHYHU\ILQHYHU\DGPLUDEOHDQGYHU\YDOXDEOH
9DOXDEOH SHDUOV RFFXU LQ WKH ZLOG EXW WKH\ DUH YHU\ UDUH &XOWXUHG RU IDUPHG SHDUOV
PDNHXSWKHPDMRULW\RI WKRVHWKDWDUHFXUUHQWO\ VROG3HDUOVIURPWKHVHDDUHYDOXHGPRUH
KLJKO\WKDQ IUHVKZDWHU SHDUOV ,PLWDWLRQ RU IDNH SHDUOV DUHDOVR ZLGHO\ VROG LQ LQH[SHQVLYH
MHZHOU\ EXWWKH TXDOLW\ RI WKHLU LULGHVFHQFHLV XVXDOO\ YHU\ SRRU  DQG JHQHUDOO\ VSHDNLQJ
DUWLILFLDOSHDUOVDUHHDVLO\GLVWLQJXLVKHGIURPJHQXLQHSHDUOV3HDUOVKDYHEHHQKDUYHVWHGDQG
FXOWLYDWHGSULPDULO\IRUXVHLQMHZHOOHU\EXWLQWKHSDVWWKH\ZHUHDOVRVWLWFKHGRQWRODYLVK
FORWKLQJ 3HDUOV KDYH DOVR EHHQ FUXVKHG DQG XVHG LQ FRVPHWLFV PHGLFLQHV RU LQ SDLQW
IRUPXODWLRQV
3HDUOVWKDWDUHFRQVLGHUHGWREHRI JHPVWRQHTXDOLW\ DUH DOPRVW DOZD\V QDFUHRXV DQG
LULGHVFHQWOLNHWKHLQWHULRURIWKHVKHOOWKDWSURGXFHVWKHP+RZHYHUPRVWVSHFLHVRIVKHOOHG
PROOXVNVDUHFDSDEOHRISURGXFLQJFDOFDUHRXVFRQFUHWLRQVFUHDWLQJSHDUOVRIOHVVHUVKLQHRU
OHVVVSKHULFDOVKDSH$OWKRXJKWKHVHPD\DOVREHOHJLWLPDWHO\UHIHUUHGWRDVSHDUOVXQGHU8
6)HGHUDO7UDGH&RPPLVVLRQUXOHVDQGDUHIRUPHGLQWKHVDPHZD\PRVWRIWKHPKDYHQR
YDOXHH[FHSWDVFXULRV

'HILQLWLRQRIDSHDUO

$OPRVWDQ\VKHOOHGPROOXVNFDQE\ QDWXUDO SURFHVVHV SURGXFH VRPH NLQG RISHDUO
ZKHQDQLUULWDWLQJPLFURVFRSLFREMHFWEHFRPHVWUDSSHGZLWKLQWKHPROOXVN VPDQWOHIROGVEXW
WKHJUHDWPDMRULW\RIWKHVHSHDUOVDUHQRWYDOXHGDVJHPVWRQHV1DFUHRXVSHDUOVWKHEHVW
NQRZQDQGPRVWFRPPHUFLDOO\VLJQLILFDQW SHDUOVDUHSULPDULO\SURGXFHGE\WZRJURXSVRI
PROOXVFDQ ELYDOYHV RU FDOPV $ QDFUHRXV SHDUO LV PDGH IURP OD\HUV RI QDFUHE\ WKH VDPH
OLYLQJSURFHVVDVLVXVHGLQWKHVHFUHWLRQRIWKHPRWKHURISHDUOZKLFKOLQHVWKHVKHOO
$QDWXUDOSHDUOLVRQHWKDWIRUPVZLWKRXWDQ\KXPDQLQWHUYHQWLRQDWDOOLQWKHZLOG
DQGLVYHU\UDUH0DQ\KXQGUHGVRISHDUOR\VWHUVRUSHDUOPXVVHOVKDYHWR EHJDWKHUHGDQG
RSHQHG DQG WKXV NLOOHG WR ILQG HYHQ RQH ZLOG SHDUO DQG IRU PDQ\ FHQWXULHV WKDW ZDV WKH
RQO\ ZD\ SHDUOV ZHUH REWDLQHG 7KLV ZDV WKH PDLQ UHDVRQ ZK\ SHDUOV IHWFKHG VXFK
H[WUDRUGLQDU\SULFHVLQ WKHSDVW$FXOWXUHGSHDUO&RQYHUVHO\ LV RQHWKDW KDV EHHQIRUPHG
ZLWKKXPDQLQWHUYHQWLRQRQDSHDUOIDUP7KHYDVWPDMRULW\RISHDUOVRQWKHPDUNHWWRGD\DUH
FXOWXUHGSHDUOV
2QH IDPLO\ RI QDFUHRXV SHDUO ELYDOYHV WKH SHDUO R\VWHUV OLYHV LQ WKH VHD ZKLOH WKH
RWKHUYHU\GLIIHUHQWJURXSVRIELYDOYHVOLYHLQIUHVKZDWHUWKHVHDUHWKHULYHUPXVVHOVVXFKDV
WKHIUHVKZDWHUPXVVHO6DOWZDWHUSHDUOVFDQJURZLQVHYHUDOVSHFLHVRIPDULQHSHDUOR\VWHUV

ϯϵϭ

 LQWKHIDPLO\3WHULLGDH)UHVKZDWHUSHDUOVJURZZLWKLQFHUWDLQ EXWE\QRPHDQVDOO VSHFLHV
RIIUHVKZDWHUPXVVHOVLQWKHRUGHU8QLRQLGDWKHIDPLOLHV8QLRQLGDHDQG0DUJDULWLIHULGDH

3K\VLFDOSURSHUWLHV
7KHXQLTXHOXVWHURISHDUOVGHSHQGVXSRQWKHUHIOHFWLRQUHIUDFWLRQDQG GLIIUDFWLRQRI
OLJKWIURPWKHWUDQVOXFHQWOD\HUV7KHWKLQQHUDQGPRUHQXPHURXVWKHOD\HUVLQWKHSHDUOWKH
ILQHU LV WKH OXVWHU 7KH LULGLVFHQFH WKDW SHDUOV GLVSOD\ LV FDXVHG E\ WKH RYHUODSSLQJ RI
VXFFHVVLYHOD\HUVZKLFKEUHDNVXSOLJKWIDOOLQJRQWKHVXUIDFH
,QDGGLWLRQSHDUOV HVSHFLDOO\FXOWXUHGIUHVKZDWHUSHDUOV FDQEHG\HG\HOORZJUHHQ
EOXHEURZQSLQNSXUSOHRUEODFN

)UHVKZDWHUDQGVDOWZDWHUSHDUOV



)LJXUH6KHOORIRQHVSHFLHVRIIUHVKZDWHUSHDUOPXVVHO0DUJDULWLIHUD
PDUJDULWLIHUD
)UHVKZDWHUDQGVDOWZDWHUSHDUOVPD\VRPHWLPHVORRNTXLWHVLPLODUEXWWKH\FRPHIURP
GLIIHUHQW VRXUFHV1DWXUDO IUHVKZDWHU SHDUOV IRUP LQ YDULRXV VSHFLHVRI IUHVKZDWHU PXVVHOV
IDPLO\8QLRQLGDHZKLFKOLYHLQODNHVULYHUVSRQGVDQGRWKHUERGLHVRIIUHVKZDWHU7KHVH
IUHVKZDWHUSHDUOPXVVHOVRFFXUQRWRQO\LQKRWWHUFOLPDWHVEXWDOVRLQFROGHUPRUHWHPSHUDWH
DUHDV )LJXUH 6DOWZDWHUSHDUOVJURZZLWKLQSHDUOR\VWHUVIDPLO\3WHULLGDHZKLFKOLYHLQ
RFHDQV6DOWZDWHUSHDUOR\VWHUVDUHXVXDOO\FXOWLYDWHGLQSURWHFWHGODJRRQVRUYROFDQLFDWROOV

ϯϵϮ

&UHDWLRQRIDSHDUO


)LJXUH&RPSDULVRQRIDFURVVVHFWLRQRIDFXOWXUHGSHDUOXSSHUZLWKDQDWXUDO
SHDUOORZHU
7KHGLIIHUHQFHEHWZHHQQDWXUDODQGFXOWXUHGSHDUOVIRFXVHVRQZKHWKHUWKHSHDUOZDV
FUHDWHGVSRQWDQHRXVO\E\QDWXUHZLWKRXWKXPDQLQWHUYHQWLRQRUZLWKKXPDQDLG3HDUOVDUH
IRUPHG LQVLGH WKH VKHOO RI FHUWDLQ PROOXVNV DV D GHIHQVH PHFKDQLVP WR D SRWHQWLDOO\
WKUHDWHQLQJLUULWDQWVXFKDVDSDUDVLWHLQVLGHLWVVKHOOWKHPROOXVNFUHDWHVDSHDUOWRVHDORII
WKHLUULWDWLRQ
7KHPDQWOHRIWKHPROOXVNGHSRVLWVOD\HUVRIFDOFLXPFDUERQDWH &D&2 LQWKHIRUPRI
WKHPLQHUDODUDJRQLWHRUDPL[WXUHRIDUDJRQLWHDQGFDOFLWH ERWKFU\VWDOOLQHIRUPVRIFDOFLXP
FDUERQDWH  KHOG WRJHWKHU E\ DQ RUJDQLF KRUQOLNH FRPSRXQG FDOOHG FRQFKLROLQ 7KH
FRPELQDWLRQ RIDUDJRQLWH DQG FRQFKLROLQ LVFDOOHG QDFUH ZKLFK PDNHV XS PRWKHURISHDUO
7KHFRPPRQO\KHOGEHOLHIWKDWDJUDLQRIVDQGDFWVDVWKHLUULWDQWLVLQIDFWUDUHO\WKHFDVH
7\SLFDO VWLPXOL LQFOXGH RUJDQLF PDWHULDO SDUDVLWHV RU HYHQ GDPDJH WKDW GLVSODFHV PDQWOH
WLVVXH WR DQRWKHU SDUW RI WKH DQLPDO V ERG\ 7KHVH VPDOO SDUWLFOHV RU RUJDQLVPV HQWHU WKH
DQLPDO ZKHQ WKH VKHOO YDOYHV DUH RSHQ IRU IHHGLQJ RU UHVSLUDWLRQ ,Q FXOWXUHG SHDUOV WKH
LUULWDQWLVW\SLFDOO\DFXWSLHFHRIWKHPDQWOHHSLWKHOLXPWRJHWKHUZLWKSURFHVVHGVKHOOEHDGV
WKHFRPELQDWLRQRIZKLFKWKHDQLPDODFFHSWVLQWRLWVERG\ )LJXUH 

1DWXUDOSHDUOV
1DWXUDO SHDUOV DUH QHDUO\  FDOFLXP FDUERQDWH DQG FRQFKLROLQ ,W LV WKRXJKW WKDW
QDWXUDO SHDUOV IRUP XQGHU D VHW RI DFFLGHQWDO FRQGLWLRQV ZKHQ D PLFURVFRSLF LQWUXGHU RU
SDUDVLWHHQWHUVDELYDOYHPROOXVNDQGVHWWOHVLQVLGHWKHVKHOO7KHPROOXVNEHLQJLUULWDWHGE\
WKH LQWUXGHU VHFUHWHV WKH FDOFLXP FDUERQDWH DQG FRQFKLROLQ WR FRYHU WKH LUULWDQW 7KLV
VHFUHWLRQ SURFHVV LV UHSHDWHG PDQ\ WLPHV WKXV SURGXFLQJ D SHDUO 1DWXUDO SHDUOV FRPH LQ
PDQ\VKDSHVZLWKSHUIHFWO\URXQGRQHVEHLQJFRPSDUDWLYHO\UDUH

ϯϵϯ

9DOXHRIDQDWXUDOSHDUO
4XDOLW\ QDWXUDO SHDUOV DUH YHU\ UDUH MHZHOV 7KH DFWXDO YDOXH RI D QDWXUDO SHDUO LV
GHWHUPLQHGLQWKHVDPHZD\DVLWZRXOGEHIRURWKHUSUHFLRXVJHPV7KHYDOXDWLRQIDFWRUV
LQFOXGHVL]HVKDSHDQGTXDOLW\RIVXUIDFHRULHQWDQGOXVWHU
6LQJOH QDWXUDO SHDUOV DUH RIWHQ VROG DV D FROOHFWRU V LWHP RU VHW DV FHQWHUSLHFHV LQ
XQLTXHMHZHOU\9HU\IHZPDWFKHGVWUDQGVRIQDWXUDOSHDUOVH[LVWDQGWKRVHWKDWGRRIWHQVHOO
IRUKXQGUHGVRIWKRXVDQGVRIGROODUV
.HVKL SHDUOVDOWKRXJK WKH\ RIWHQ RFFXUE\FKDQFH DUH QRWFRQVLGHUHGQDWXUDOSHDUOV
7KH\ DUH D E\SURGXFW RI WKH FXOWXULQJ SURFHVV DQG KHQFH GR QRW KDSSHQ ZLWKRXW KXPDQ
LQWHUYHQWLRQ7KHVHSHDUOVDUHTXLWHVPDOOW\SLFDOO\DIHZPLOOLPHWHUVLQVL]H.HVKLSHDUOV
DUHSURGXFHGE\PDQ\GLIIHUHQWW\SHVRIPDULQHPROOXVNVDQGIUHVKZDWHUPXVVHOVLQ&KLQD
7RGD\PDQ\NHVKLSHDUOVDUHDFWXDOO\LQWHQWLRQDOZLWKSRVWKDUYHVWVKHOOVUHWXUQHGWRWKH
ZDWHUWRUHJHQHUDWHDSHDUOLQWKHH[LVWLQJSHDUOVDF

2ULJLQRIDQDWXUDOSHDUO
3UHYLRXVO\QDWXUDOSHDUOVZHUHIRXQGLQPDQ\SDUWVRIWKHZRUOG3UHVHQWGD\QDWXUDO
SHDUOLQJ LV FRQILQHG PRVWO\ WR VHDV RI %DKUDLQ $XVWUDOLD DOVR KDV RQH RI WKH ZRUOG V ODVW
UHPDLQLQJIOHHWVRISHDUOGLYLQJVKLSV$XVWUDOLDQSHDUOGLYHUVGLYHIRUVRXWKVHDSHDUOR\VWHUV
WREHXVHGLQWKHFXOWXUHGVRXWKVHDSHDUOLQGXVWU\7KHFDWFKRISHDUOR\VWHUVLVVLPLODUWRWKH
QXPEHUVRIR\VWHUVWDNHQGXULQJWKHQDWXUDOSHDUOGD\V+HQFHVLJQLILFDQWQXPEHUVRIQDWXUDO
SHDUOV DUH VWLOO IRXQG LQ WKH $XVWUDOLDQ ,QGLDQ 2FHDQ ZDWHUV IURP ZLOG R\VWHUV ;5D\
H[DPLQDWLRQLVUHTXLUHGWRSRVLWLYHO\YHULI\QDWXUDOSHDUOVIRXQGWRGD\

&XOWXUHGSHDUOV
&XOWXUHGSHDUOV QXFOHDWHGDQGQRQQXFOHDWHGRUWLVVXHQXFOHDWHGFXOWXUHGSHDUOV DQG
LPLWDWLRQ SHDUOVFDQ EHGLVWLQJXLVKHGIURPQDWXUDO SHDUOV E\ ;UD\ H[DPLQDWLRQ 1XFOHDWHG
FXOWXUHGSHDUOVDUHRIWHQ SUHIRUPHG DVWKH\WHQGWRIROORZWKHVKDSHRIWKHLPSODQWHGVKHOO
EHDGQXFOHXV2QFHWKHSUHIRUPHGEHDGVDUHLQVHUWHGLQWRWKHR\VWHULWVHFUHWHVDIHZOD\HUV
RIQDFUHDURXQGWKHRXWVLGHVXUIDFHRIWKHLPSODQWEHIRUHLWLVUHPRYHGDIWHUVL[PRQWKVRU
PRUH
:KHQDQXFOHDWHGFXOWXUHGSHDUOLV;UD\HGLWUHYHDOVDGLIIHUHQWVWUXFWXUHWRWKDWRID
QDWXUDOSHDUO$FXOWXUHGSHDUOVKRZVDVROLGFHQWHUZLWKQRFRQFHQWULFJURZWKULQJVZKHUHDV
DQDWXUDOSHDUOVKRZVDVHULHVRIFRQFHQWULFJURZWKULQJV


ϯϵϰ

'LIIHUHQWW\SHVRIFXOWXUHGSHDUOVLQFOXGLQJEODFNSHDUOV


)LJXUH$EOLVWHUSHDUODKDOIVSKHUHIRUPHGIOXVKDJDLQVWWKHVKHOORIWKHSHDUO
R\VWHU
%ODFNSHDUOVIUHTXHQWO\UHIHUUHGWRDV%ODFN7DKLWLDQ3HDUOVDUHKLJKO\YDOXHGEHFDXVH
RIWKHLUUDULW\WKHFXOWXULQJSURFHVVIRUWKHPGLFWDWHVDVPDOOHUYROXPHRXWSXWDQGFDQQHYHU
EHPDVVSURGXFHG7KLVLVGXHWREDGKHDOWKDQGRUQRQVXUYLYDORIWKHSURFHVVUHMHFWLRQRI
WKHQXFOHXVDQGWKHLUVHQVLWLYLW\WRFKDQJLQJFOLPDWLFDQGRFHDQFRQGLWLRQV%HIRUHWKHGD\V
RIFXOWXUHGSHDUOVEODFNSHDUOVZHUHUDUHDQGKLJKO\YDOXHGIRUWKHVLPSOHUHDVRQWKDWZKLWH
SHDUOR\VWHUVUDUHO\SURGXFHGQDWXUDOO\EODFNSHDUOVDQGEODFNSHDUOR\VWHUVUDUHO\SURGXFHG
DQ\QDWXUDOSHDUOVDWDOO
6LQFH WKH GHYHORSPHQW RI SHDUO FXOWXUH WHFKQRORJ\ WKH EODFN SHDUO R\VWHU IRXQG LQ
7DKLWLDQGPDQ\RWKHU3DFLILF,VODQGDUHDVKDVEHHQH[WHQVLYHO\XVHGIRUSURGXFLQJFXOWXUHG
SHDUOV 7KH UDULW\ RI WKH EODFN FXOWXUHG SHDUO LV QRZ D FRPSDUDWLYH LVVXH 7KH EODFN
FXOWXUHG SHDUO LV UDUH ZKHQ FRPSDUHG WR &KLQHVH IUHVKZDWHU FXOWXUHG SHDUOV DQG -DSDQHVH
DQG &KLQHVH DNR\D FXOWXUHG SHDUOV DQG LV PRUHYDOXDEOH WKDQ WKHVH SHDUOV +RZHYHU LW LV
PRUH DEXQGDQW WKDQ WKH 6RXWK 6HD SHDUO ZKLFK LV PRUH YDOXDEOH WKDQ WKH EODFN FXOWXUHG
SHDUO 7KLV LV VLPSO\ EHFDXVH WKH EODFN SHDUO R\VWHU 3LQFWDGD PDUJDULWLIHUD LV IDU PRUH
DEXQGDQW WKDQ WKHHOXVLYH UDUHDQGODUJHU VRXWKVHD SHDUO R\VWHU 3LQFWDGD PD[LPD ZKLFK
FDQQRW EH IRXQG LQ ODJRRQV EXW ZKLFK PXVW EH GLYHG IRU LQ D UDUH QXPEHU RI GHHS RFHDQ
KDELWDWVRUJURZQLQKDWFKHULHV
%ODFN FXOWXUHG SHDUOV IURP WKH EODFN SHDUO R\VWHU3LQFWDGD PDUJDULWLIHUD DUH QRW
6RXWK6HDSHDUOVDOWKRXJKWKH\DUHRIWHQPLVWDNHQO\GHVFULEHGDVEODFN6RXWK6HDSHDUOV,Q
WKH DEVHQFH RI DQ RIILFLDO GHILQLWLRQ IRU WKH SHDUO IURP WKH EODFN R\VWHU WKHVH SHDUOV DUH
XVXDOO\UHIHUUHGWRDVEODFN7DKLWLDQSHDUOV )LJXUH 
6RXWK6HDSHDUOVDUHWKHFRORURIWKHLUKRVW3LQFWDGDPD[LPDR\VWHUDQGFDQEHZKLWH
VLOYHUSLQNJROGFUHDPDQGDQ\FRPELQDWLRQRIWKHVHEDVLFFRORUVLQFOXGLQJRYHUWRQHVRI
WKHYDULRXVFRORUVRIWKHUDLQERZGLVSOD\HGLQWKHSHDUOQDFUHRIWKHR\VWHUVKHOOLWVHOI

'HYHORSPHQWRISHDUOIDUPLQJ
7RGD\ PRVW SHDUOV XVHG IRU MHZHOU\ DUH FXOWXUHG E\ SODQWLQJ D FRUH RU QXFOHXV LQWR
SHDUO R\VWHUV 7KH SHDUOV DUH XVXDOO\ KDUYHVWHG DIWHU RQH \HDU IRU DNR\D ± \HDUV IRU
7DKLWLDQDQG6RXWK6HDDQG±\HDUVIRUIUHVKZDWHU 7KHQXFOHXV LV JHQHUDOO\ D SROLVKHG
ϯϵϱ

 EHDG PDGH IURP IUHVKZDWHU PXVVHO VKHOO $ORQJ ZLWK D VPDOO SLHFH RI PDQWOH WLVVXH IURP
DQRWKHU PROOXVN WR VHUYH DV D FDWDO\VW IRU WKH SHDUO VDF LW LV VXUJLFDOO\ LPSODQWHG LQWR WKH
JRQDG UHSURGXFWLYHRUJDQ RIDVDOWZDWHUPROOXVN,QIUHVKZDWHUSHUOLFXOWXUHRQO\WKHSLHFH
RI WLVVXH LV XVHG LQ PRVW FDVHV DQG LV LQVHUWHG LQWR WKH IOHVK\ PDQWOH RI WKH KRVW PXVVHO
6RXWK 6HD DQG 7DKLWLDQ SHDUO R\VWHUV DOVR NQRZQ DV 3LQFWDGD PD[LPD DQG 3LQFWDGD
PDUJDULWLIHUDZKLFKVXUYLYHWKHVXEVHTXHQWVXUJHU\WRUHPRYHWKHILQLVKHGSHDUODUHRIWHQ
LPSODQWHGZLWKDQHZODUJHUQXFOHXVDVSDUWRIWKHVDPHSURFHGXUHDQGWKHQUHWXUQHGWRWKH
ZDWHUIRUDQRWKHU±\HDUVRIJURZWK
'HVSLWH WKH FRPPRQ PLVSHUFHSWLRQ 0LNLPRWR GLG QRW GLVFRYHU WKH SURFHVV RI SHDUO
FXOWXUH 7KH DFFHSWHG SURFHVV RI SHDUO FXOWXUH ZDV GHYHORSHG E\ :LOOLDP 6DYLOOH.HQW LQ
$XVWUDOLD DQG EURXJKW WR -DSDQ E\ 7RNLFKL 1LVKLNDZD DQG 7DWVXKHL 0LVH 1LVKLNDZD ZDV
JUDQWHGWKHSDWHQWLQDQGPDUULHGWKHGDXJKWHURI0LNLPRWR0LNLPRWRZDVDEOHWRXVH
1LVKLNDZD V WHFKQRORJ\ $IWHU WKH SDWHQW ZDV JUDQWHG LQ  WKH WHFKQRORJ\ ZDV
LPPHGLDWHO\ FRPPHUFLDOO\ DSSOLHG WR DNR\D SHDUO R\VWHUV LQ -DSDQ LQ  0LVH V EURWKHU
ZDVWKHILUVWWRSURGXFHDFRPPHUFLDOFURSRISHDUOVLQWKHDNR\DR\VWHU0LWVXELVKL V%DURQ
,ZDVDNL LPPHGLDWHO\ DSSOLHG WKH WHFKQRORJ\ WR WKH VRXWK VHD SHDUO R\VWHU LQ  LQ WKH
3KLOLSSLQHV DQG ODWHU LQ %XWRQ DQG 3DODX 0LWVXELVKL ZDV WKH ILUVW WR SURGXFH D FXOWXUHG
VRXWKVHDSHDUODOWKRXJKLWZDVQRWXQWLOWKDWWKHILUVWVPDOOFRPPHUFLDOFURSRISHDUOV
ZDVVXFFHVVIXOO\SURGXFHG
7KH RULJLQDO -DSDQHVH FXOWXUHG SHDUOV NQRZQ DV DNR\D SHDUOV DUH SURGXFHG E\ D
VSHFLHVRIVPDOOSHDUOR\VWHU3LQFWDGDIXFDWDPDUWHQVLLZKLFKLVQRELJJHUWKDQWRFPLQ
VL]HKHQFHDNR\DSHDUOVODUJHUWKDQPPLQGLDPHWHUDUHH[WUHPHO\UDUHDQGKLJKO\SUL]HG
7RGD\DK\EULGPROOXVNLVXVHGLQERWK-DSDQDQG&KLQDLQWKHSURGXFWLRQRIDNR\DSHDUOV
,W LV D FURVV EHWZHHQ WKH RULJLQDO -DSDQHVH VSHFLHV DQG WKH &KLQHVH VSHFLHV 3LQFWDGD
FKHPQLW]LL

3HDUO2\VWHUIDUPLQJ

6HOHFWLRQRIFXOWXUHVLWHV
,Q DQ\ IDUPLQJ DFWLYLW\ FXOWXUH VLWH VHOHFWLRQ LV RI SDUDPRXQW LPSRUWDQFH
7HFKQRORJLFDO DQG HFRQRPLF FRQVLGHUDWLRQV SOD\ D PDMRU UROH LQ WKH VHOHFWLRQ SURFHVV $
FDUHIXODSSUDLVDORIWKHKDELWVRIWKHRUJDQLVPWREHFXOWXUHGZRXOGJLYHDUHVRQDEOHOHYHORI
FRQILGHQFHRQ WKH WROHUDQFH OLPLWV ZLWKLQ ZKLFK WKH YDULRXV HQYLURQPHQWDO SDUDPHWHUV FDQ
YDU\'XHFRQVLGHUDWLRQKDVWREHJLYHQWRSRVVLEOHHIIHFWVRIIOXFWXDWLQJZDWHUIORZSULPDU\
SURGXFWLRQ VLOWDWLRQ HWF WR REWDLQ WKH RSWLPXP OHYHO RI JURZWK DQG SURGXFWLRQ RI KLJK
TXDOLW\ SHDUOV 8QVXLWDEOH OHYHOV RI HQYLURQPHQWDO IDFWRUV VXFK DV VDOLQLW\ ZDWHU
WHPSHUDWXUHFROGZDWHUFXUUHQWVDQGRWKHUIDFWRUVVXFKDVUHGWLGHVK\GURJHQVXOSKLGHDQG
SROOXWLRQE\LQGXVWULDODQGGRPHVWLFHIIOXHQWVDUHVHULRXVKD]DUGVWRSHDUOFXOWXUH
6KHOWHUHGED\VDUHLGHDOORFDWLRQVIRUSHDUOR\VWHUIDUPV7KH\RIIHUJRRGSURWHFWLRQWR
WKHFXOWXUHVWUXFWXUHVVXFKDVUDIWVDQGFDJHV6KDOORZFRDVWDOZDWHUVZKHUHWKHVHDLVFDOP
PRVWRIWKH\HDUFDQDOVREHFRQVLGHUHGDVDVXLWDEOHVLWH

(QYLURQPHQWDOFRQGLWLRQV

7HPSHUDWXUH
,QWHPSHUDWHUHJLRQV WKH ZDWHU WHPSHUDWXUH SOD\V DQLPSRUWDQWUROHLQWKHELRORJLFDO
DFWLYLWLHV RI SHDUO R\VWHUV ,Q -DSDQ WKH RSWLPXP WHPSHUDWXUH IRU R\VWHU JURZWK KDV EHHQ
IRXQGWREHEHWZHHQ±ƒ&$WHPSHUDWXUHEHORZƒ&FDXVHVK\EHUQDWLRQ%HORZƒ&
ϯϵϲ

 WKHR\VWHUVGLH$WWHPSHUDWXUHVDERYHƒ&WKHR\VWHUVVKRZH[KDXVWLRQ7KHWKLFNQHVVHV
RIWKHSHDUOOD\HUVDUHDIIHFWHGE\WKHPLQXWHFKDQJHVLQZDWHUWHPSHUDWXUHGXULQJWKHGD\
DQGYDU\FRQVLGHUDEO\DFFRUGLQJWRWKHVHDVRQRIWKH\HDU7KHGHSRVLWLRQRIFDOFLXPVWRSVDW
DZDWHUWHPSHUDWXUHRI ƒ&,QWKH*XOIRI.XWFK WKH R\VWHUVJURZ YLJRURXVO\LQ ZLQWHU
PRQWKV ZKHQ WKH VHDZDWHU WHPSHUDWXUH UDQJHV EHWZHHQ ± ƒ& $ VOLJKW GHFUHDVH LQ
WHPSHUDWXUH WULJJHUV VSDZQLQJLQ R\VWHUVZDV QRWLFHG LQ WKH *XOI RI 0DQQDU 7KH JURZWK
WHPSHUDWXUHUHODWLRQVKLSLV SUHVXPDEO\ YDOLGRQO\ XS WRDFHUWDLQWHPSHUDWXUHIRURSWLPXP
JURZWK

6DOLQLW\
3HDUOR\VWHUVWROHUDWHDZLGHUDQJHRIVDOLQLW\IURP±ÅIRUDVKRUWGXUDWLRQRI±
 GD\V 6DOLQLWLHV RI  Å DQG  Å PD\FDXVH   PRUWDOLW\ DPRQJ WKH R\VWHUV 7KH
HIIHFWRIVDOLQLW\RQWKHJURZWKRISHDUOR\VWHUKDVQRWEHHQFOHDUO\LQYHVWLJDWHG+RZHYHULW
DSSHDUV WKDW SHDUO R\VWHUV WHQG WR SUHIHU KLJK VDOLQLWLHV 2\VWHUV UDLVHG LQ VXFK VDOLQLWLHV
SURGXFHSHDUOVZLWKDJROGHQWLQW

%RWWRP
*UDYHOO\ERWWRPVDUHVXLWDEOHIRUSHDUOR\VWHUIDUPLQJZKLOHVDQG\RUPXGG\ERWWRPV
VKRXOGEHDYRLGHG2\VWHUJURZWKLVDIIHFWHGE\ZDWHUWHPSHUDWXUHDQGQXWULWLRQDOFRQGLWLRQ
RIWKHJURXQG5HSHDWHGFXOWXUHRQWKHVDPHJURXQGOHDGVWRVRPHH[WHQWWKHGHWHULRUDWLRQRI
SHDUOTXDOLW\ 7KHFKHPLFDODQG SK\VLFDO VWDWH RI WKHVHDERWWRPLVDIIHFWHGE\WKHRUJDQLF
VXEVWDQFHV GLVFKDUJHG IURP WKH R\VWHUV DQG IRXOLQJ RUJDQLVPV 3HULRGLF UHPRYDO RI VXFK
DFFXPXODWHGVXEVWDQFHVIURP WKH ERWWRPRIWKHFXOWXUHJURXQGVRIWHQLQFUHDVHV SURGXFWLRQ
DVZHOODVTXDOLW\

'HSWK
7KHRSWLPXPGHSWKIRUIDUPLQJSHDUOR\VWHUVLVDURXQGP$WJUHDWHUGHSWKVHYHQ
LIWKHUDWHRIQDFUHGHSRVLWLRQLVVORZHUSHDUOVRIKLJKTXDOLW\ZLWKDSLQNLVKFRORXUDWLRQDUH
REWDLQHG

6LOWORDG
3HDUO R\VWHUV JHQHUDOO\ SUHIHU FOHDU ZDWHUV DV KLJK WXUELGLW\ OHYHOV ZLOO DIIHFW WKHLU
ILOWUDWLRQHIILFLHQF\$GHFOLQHLQR\VWHUFRQGLWLRQZDVQRWHGDW9HSSDORGDLIDUPGXHWRWKH
KLJKVLOWFRQWHQWLQWKHIDUPDUHDWKURXJKRXWPRVWRIWKH\HDU

:DWHUFXUUHQW
&XOWXUH VLWHV VKRXOG EH QDWXUDOO\ VKHOWHUHG DJDLQVW VWURQJ ZLQGV DQG ZDYHV 7LGDO
DPSOLWXGHDQGFXUUHQWVPXVW EH VXIILFLHQWWRDOORZUHSOHQLVKPHQW RI R[\JHQDWHG ZDWHUDQG
IUHVKSODQNWRQDQGIOXVKDZD\ZDVWHPDWHULDOV,QVWURQJZDWHUFXUUHQWVWKHIRUPDWLRQRIWKH
SHDUOOD\HUVLVXVXDOO\IDVWEXWWKHTXDOLW\RISHDUOVSURGXFHGLVDIIHFWHG

3ULPDU\SURGXFWLYLW\
7KH FRQGLWLRQ RI D VSHFLILF FXOWXUH JURXQG GHSHQGV SULPDULO\ RQ WKH FKHPLFDO
FRQVWLWXWLRQ RI WKH VHDZDWHU DQG RQ WKH VSHFLHV DQG DPRXQW RI SODQNWRQ SUHVHQW 5LFK
QXWULHQWVGLVFKDUJHGE\ULYHUVLQWRWKHVHDDUHUHVSRQVLEOHIRUKLJKSULPDU\SURGXFWLYLW\7KH
R\VWHUVSUREDEO\GHULYHWKHLUFKLHIVRXUFHRIFRQFKLROLQIURPWKHQLWURJHQVXEVWDQFHRIWKH
SODQNWRQ7KHRUJDQLFPDWWHUDQGFDOFLXPGLVVROYHGLQWKHVHDZDWHUDUHGLUHFWO\DEVRUEHGE\

ϯϵϳ

 WKHIRRGFRQVXPSWLRQ FHOOV7KHFDOFLXPSDVVHVWKURXJKWKHPDQWOHWR EHGHSRVLWHG RQWKH
VXUIDFHRIWKHVKHOORUSHDUOLQWKHSURFHVVRIWKHLUIRUPDWLRQ7KHSUHVHQFHRIWUDFHPHWDOVLQ
VPDOOTXDQWLWLHVLQIOXHQFHVWKHFRORXURIWKHQDFUH

6XSSO\RIR\VWHUV
,Q SHDUO R\VWHU IDUPLQJ R\VWHUV FROOHFWHG IURP WKH QDWXUDO EHGV RU UHDUHG IURP
QDWXUDOO\FROOHFWHGRUFXOWXUHGVSDWDUHXVHG,QWKH*XOIRI0DQQDUVHYHUDOSHDUOEDQNVDUH
GLVWULEXWHGRII7XWLFRUQDWDGLVWDQFHRI±NPDQGDWGHSWKVRI±P3HDUOR\VWHUV
IURPWKHVHEHGVDUHFROOHFWHGE\VNLQDQG6&8%$GLYLQJ )LJXUH$ :LGHIOXFWXDWLRQVLQ
WHUPVRISHDUOR\VWHUVDYDLODELOLW\KDYHEHHQQRWHGLQGLIIHUHQWSHDUOEDQNVLQWKLVDUHDGXULQJ
WKHODVWIHZFHQWXULHVDV DOVRGXULQJ WKH PRVWUHFHQW \HDUV ,QWKH*XOIRI.XWFKWKHSHDUO
R\VWHUVDUHIRXQGRQWKHLQWHUWLGDOIODWVDQGWKHSRSXODWLRQLVVSDUVH &ROOHFWLRQ LV GRQH E\
KDQG
,Q -DSDQ R\VWHU VSDW DUH FROOHFWHG E\ VXEPHUJLQJ EXQGOHV RI FHGDU WZLJV QHDU WKH
ZDWHUVXUIDFHGXULQJWKHSHDNODUYDOVHWWOHPHQWVHDVRQ+\]H]ILOPVDQGROGILVKQHWVDUHDOVR
FRPPRQO\ XVHG DV VSDW FROOHFWRUV $OPRVW WKH HQWLUH UHTXLUHPHQW RI R\VWHU VXSSO\ WR WKH
SHDUOFXOWXUHLQGXVWU\LVPHWE\WKLVW\SHRIVSDWFROOHFWLRQ6SDWFROOHFWLRQDWWHPSWVLQ,QGLD
KDYHQRWEHHQVXFFHVVIXODQGWKLVPD\EHGXHWRWKHGLVWDQFHRIWKHSHDUOR\VWHUEHGVIURP
FRDVWDOZDWHUV
+RZHYHU,QGLDKDVUHFHQWO\VXFFHHGHGLQSURGXFLQJSHDUOR\VWHUVHHGXQGHUKDWFKHU\
FRQGLWLRQVWKHUE\SURYLGLQJWKHLQGXVWU\ZLWKDPRUHGHSHQGDEOHVRXUFHRIR\VWHUV

5HDULQJPHWKRGV

5DIWFXOWXUH
5DIWFXOWXUHLVFRQVLGHUHGWREHRQHRIWKHPRVWVXLWDEOHIDUPLQJPHWKRGVLQVKHOWHUHG
ED\V7KHVL]HRIWKHUDIWVFDQEHDOWHUHGDFFRUGLQJWRWKHFRQYHQLHQFHRIWKHVLWXDWLRQ$UDIW
RI î P LQ VL]H FDQ EH HDVLO\ FRQVWUXFWHG DQG IORDWHG ZLWK  EXR\V 5DIWV DUH XVXDOO\
FRQVWUXFWHGZLWKORJVRIWHDNYHQWHDNRUFDVXDULQDZRRGRIFKRVHQOHQJWKZLWKWKHERWWRP
RI DERXW  FP GLDPHWHU WDSHULQJ WR  FP GLDPHWHU DW WKH WLS 7KHVH ORJV DUH DUUDQJHG
DFFRUGLQJ WR WKH UHTXLUHPHQW DQG ODVKHG ZLWK FRLU URSHV )ORDWV DUH DWWDFKHG WR WKH UDIW WR
JLYHEXR\DQF\7KHIORDWVFDQEHVHDOHGHPSW\GLHVHOGUXPVRIOFDSDFLW\ZLWKILEUHJODVV
FRDWLQJ PLOG VWHHO EDUUHOV SDLQWHG ZLWK DQWLVDOLQHDQWLFRUURVLYH SDLQWV RU )53 VW\URIRDP
IORDWV )LJXUH,9%DQG& 8QLWUDIWV\VWHPLVIRXQGWREHFRQYHQLHQWDQGZHOOVXLWHGWRWKH
,QGLDQVHD FRQGLWLRQV 5DIWV DUHPRRUHG ZLWK DQFKRUV DW RSSRVLWH VLGHV ZLWK WHVWHG TXDOLW\
FKDLQVDQGWKHLUGLUHFWLRQLVGHFLGHGDFFRUGLQJWRWKHSUHYDOHQWZLQGGLUHFWLRQDWWKHVSHFLILF
VLWH )LJXUH$& 
,QWKHORQJOLQHFXOWXUHPHWKRGVSKHULFDORUF\OLQGULFDOIORDWVZKLFKDUHFRQQHFWHGE\
KRUL]RQWDO V\QWKHWLF URSH RU FKDLQ DUH XVHG )LJXUH  ' )LJ  '  7KH R\VWHU FDJHV DUH
VXVSHQGHGIURPWKHURSHV7KLVV\VWHPLVJRRGIRURSHQVHDFRQGLWLRQV,QDQRWKHUPHWKRGRI
KDQJLQJDKROHLVGULOOHGQHDUWKHKLQJHRIWKHSHDUOR\VWHU$VPDOOWKUHDGLVSXWWKURXJKWKH
KROHZKLFKLVWKHQWLHGWRDVWUDZURSHFRDWHGZLWKWDU7KHVWUDZURSHVDUHKXQJIURPDUDIW

2QERWWRPFXOWXUH
6HD ERWWRPV ZLWK D JUDQLWH RU FRUDO VWRQHV FRPSRVLWLRQ FDQ EH XVHG IRU RQERWWRP
FXOWXUH ,Q WKH 7XWLFRULQ +DUERXU %DVLQ ZKHUH WKH EUHDNZDWHU KDV EHHQ FRQVWUXFWHG ZLWK
JUDQLWHVWRQHVWKHSURWHFWHGSRUWLRQRIWKHEUHDNZDWHULVXVHGIRUFXOWXULQJPRWKHUR\VWHUV

ϯϵϴ

 PRIZDWHULVDYDLODEOHEHORZWKHORZZDWHUPDUN'XHWRFRQVWDQWFLUFXODWLRQRIVHDZDWHU
VHWWOHPHQWRIIRXOLQJRUJDQLVPVLVSRRUDQGLQFRQVLVWHQW+RZHYHULWKDVEHHQQRWHGWKDWWKH
JURZWK RI WKH PRWKHU R\VWHU LV VORZHU LQ RQERWWRP FXOWXUH FRPSDUHG WR WKH JURZWK RI
R\VWHUVFXOWXUHGLQUDIW

5HDULQJFRQWDLQHUV

&XOWXUHRIPRWKHUR\VWHUV
%R[FDJHVPHDVXULQJîîFPDUHXVHGWRUHDUPRWKHUSHDUOR\VWHUV7KHVL]HRI
WKHPHVKYDULHVZLWKWKHVL]HRIWKHR\VWHUVWREHUHDUHG7KHIUDPHVRIWKHFDJHVDUHPDGH
XSRIPPPLOGVWHHOURGVFRDWHGZLWKDQWLFRUURVLYHSDLQWVRUFRDOWDU%R[FDJHVDUHXVHIXO
LQJHQHUDOPRWKHUR\VWHUFXOWXUH )LJXUH$ 
7RWUDFHWKHKLVWRU\DQGSHUIRUPDQFHRILQGLYLGXDO R\VWHUVIUDPHQHWV DUH XVHG 7KH
IUDPHVPHDVXULQJîFPHDFKZLWKILYHFRPSDUWPHQWVPHVKHGDQGKLQJHGDWRQHHQG
RSHQDVDERRN7KHR\VWHUVDUHDUUDQJHGLQURZVDQGKHOGLQWKHFRPSDUWPHQWVZKHQFORVHG
7KHVSDFHDYDLODEOHLQEHWZHHQWKHWZRIUDPHVLVDERXW  PP ZKLFK LV VXIILFLHQWIRU WKH
R\VWHUVWRRSHQWKHLUYDOYHVIRUIHHGLQJDQGUHVSLUDWLRQ )LJXUH% 


)LJXUH  $  $ VFXED GLYHU GLYLQJ WR FROOHFW SHDUO R\VWHUV DQG %  $ FXOWXUH UDIW
IORDWHGZLWKPLOGVWHHOEDUUHOV

ϯϵϵ

 
)LJXUH&RQW G & $FXOWXUHUDIWZLWK)53VW\URIRDPEXR\VDQG ' 2\VWHUORQJ
OLQHFXOWXUH


)LJXUH $ &XOWXUHUDIWFRQVWUXFWHGZLWKWHDNSROHV % $)53VW\URIRDPEXR\ & 
$PLOGVWHHOEXR\DQG ' 2\VWHUORQJOLQHFXOWXUHV\VWHP

ϰϬϬ

-XYHQLOHUHDULQJ
-XYHQLOHSHDUOR\VWHUVDUHUHDUHGLQQHWFDJHV )LJXUH&' 6\QWKHWLFIDEULFVRIYHORQ
VFUHHQEDJVZKRVHVLGHVDUHVWUHWFKHGZLWKDVWHHOURG LQ WKH IRUP RI D SULVP DUH XVHG IRU
UHDULQJ RI MXYHQLOHV 7KH PHVK VL]H RI WKH VFUHHQ GHSHQGV RQ WKH VL]H RI MXYHQLOHV WR EH
UHDUHG 7KH PRXWK RI WKH EDJ LV WLHG ZLWK D V\QWKHWLF WZLQH ZKLFK IDFLOLWDWHV RSHQLQJ RU
FORVLQJZKHQUHTXLUHG7RSURYLGHIXUWKHUSURWHFWLRQIURPSUHGDWRUVWKHEDJVDUHSODFHGLQ
ROG Q\ORQ ILVK QHW EDJV &ORJJLQJ E\ VLOW DQG E\ WKH JURZWK RI IRXOLQJ RUJDQLVPV FDQ EH
SUHYHQWHGE\SHULRGLFDOUHSODFHPHQWRIWKHYHORQVFUHHQEDJZKLFKFDQEHFOHDQHGVXQGULHG
DQGUHXVHG6SDWRIXSWRFPLQVL]HDUHUHDUHGLQWKHVHVPDOOQHWFDJHV%R[FDJHVZKLFK
DUH XVHG IRU UHDULQJ PRWKHU R\VWHUV FDQ DOVR EH XVHG IRU MXYHQLOH UHDULQJ E\ SURYLGLQJ DQ
DGGLWLRQDOYHORQVFUHHQFRYHULQVLGHWKHFDJH


)LJXUH  $  $ ER[FDJH FRQWDLQLQJ SHDUO R\VWHUV DQG %  $ IUDPH QHWFDJH ZLWK
R\VWHUV

ϰϬϭ

 
)LJXUH  &RQW G &  $ QHWFDJH IRU UHDULQJ R\VWHU VSDW RI ± PP LQ VL]H DQG ' 
5HDULQJQHWFDJHFRYHUHGZLWKYHORQVFUHHQ

3HDUOVDQGFDOFDUHRXVFRQFUHWLRQVIURPRWKHUVSHFLHV
%LRORJLFDOO\ VSHDNLQJ XQGHU WKH ULJKW VHW RI FLUFXPVWDQFHV DOPRVW DQ\ VKHOOHG
PROOXVNFDQSURGXFHVRPHNLQGRISHDUOKRZHYHUPRVWRIWKHVHPROOXVFDQSHDUOVKDYHQR
OXVWHURU LULGHVFHQFH 7KH JUHDWPDMRULW\ RIPROOXVN VSHFLHV SURGXFHV SHDUOV ZKLFK DUH QRW
DWWUDFWLYHWRORRNDWDQGDUHVRPHWLPHVQRWHYHQYHU\GXUDEOHVXFKWKDWWKH\XVXDOO\KDYHQR
YDOXHDWDOOH[FHSWSHUKDSVWRDVFLHQWLVWDFROOHFWRURUDVDFXULRVLW\7KHVHREMHFWVXVHGWR
EHUHIHUUHGWRDVFDOFDUHRXVFRQFUHWLRQVE\VRPHJHPRORJLVWVHYHQWKRXJKDPDODFRORJLVW
ZRXOGVWLOOFRQVLGHUWKHPWREHSHDUOV9DOXHOHVVSHDUOVRIWKLVW\SHDUHVRPHWLPHVIRXQGLQ
HGLEOHPXVVHOVHGLEOHR\VWHUVHVFDUJRWVQDLOVDQGVRRQ
$ IHZ VSHFLHV SURGXFH SHDUOV WKDW FDQ EH RI LQWHUHVW DV JHPVWRQHV 7KHVH VSHFLHV
LQFOXGH WKH EDLOHU VKHOO 0HOR WKH JLDQW FDOP 7ULGDFQD YDULRXV VFDOORS VSHFLHV 3HQ VKHOOV
3LQQDDQGDEDORQHV$QRWKHUH[DPSOHLVWKHFRQFKSHDUO VRPHWLPHVUHIHUUHGWRVLPSO\DV
WKH SLQNSHDUO ZKLFKLVIRXQGYHU\UDUHO\JURZLQJEHWZHHQWKHPDQWOHDQGWKHVKHOORIWKH
TXHHQFRQFKRUSLQNFRQFK6WURPEXVJLJDVDODUJHVHDVQDLORUPDULQHJDVWURSRGIURPWKH
&DULEEHDQ VHD 7KHVH SHDUOV ZKLFK DUH RIWHQ SLQN LQ FRORU DUH D E\SURGXFW RI WKH FRQFK
ILVKLQJ LQGXVWU\ DQG WKH EHVW RI WKHP GLVSOD\ D VKLPPHULQJ RSWLFDO HIIHFW UHODWHG WR
FKDWR\DQFHNQRZQDV IODPHVWUXFWXUH 
6RPHZKDW VLPLODU JDVWURSRG SHDUOV WKLV WLPH PRUH RUDQJH LQ KXH DUH DJDLQ YHU\
UDUHO\ IRXQGLQWKHKRUVHFRQFK3OHXWRSORFDJLJDQWHD

ϰϬϮ

 
)LJXUH/DUJHVWNQRZQSHDUOIURPDJLDQWFODP
7KH ODUJHVW SHDUO NQRZQ ZDV IRXQG LQ WKH SKLOLSSLQHV LQ  ,W LV D QDWXUDOO\
RFFXUULQJQRQQDFUHRXVFDOFDUHRXVFRQFUHWLRQ SHDUO IURPDJLDQWFDOP%HFDXVHLWGLGQRW
JURZ LQ D SHDUO R\VWHU LW LV QRW SHDUO\ EXW LQVWHDG LW KDV D SRUFHOODQHRXV VXUIDFH ,Q RWKHU
ZRUGVLWLVJORVV\OLNHDFKLQDSODWH2WKHUSHDUOVIURPJLDQWFODPVDUHNQRZQWRH[LVWEXW
WKLV LV D SDUWLFXODUO\ ODUJH RQH 7KH SHDUO ZHLJKV  OE NJ  DQG ZDV VXSSRVHGO\ ILUVW
GLVFRYHUHG E\ DQ DQRQ\PRXV )LOLSLQR 0XVOLP GLYHU RII WKH LVODQG RI 3DODZDQ LQ 
$FFRUGLQJWRWKHOHJHQGDVLWLVFXUUHQWO\WROGD3DODZDQFKLHIWDLQJDYHWKHSHDUOWR:LOEXU
'RZHOO&REELQDVDJLIWIRUKDYLQJVDYHGWKHOLIHRIKLVVRQ7KHSHDUOKDGEHHQQDPHG
WKH3HDUORI$OODKE\WKH0XVOLPWULEDOFKLHIEHFDXVHLWUHVHPEOHGDWXUEDQHGKHDG7KLV
OHJHQG KDV EHHQ GLVFUHGLWHG KRZHYHU EHFDXVH WKLV SHDUO LV LQGHHG WKH SURGXFW RI D JLDQW
FODP7ULGDFQDJLJDVZKLFKFDQQRWEHJUDIWHG )LJXUH 7KHSHDUOLVDOVRDZKROHSHDUO
QRWDPDEHSHDUODQGZKROHSHDUOFXOWXULQJWHFKQRORJ\LVRQO\\HDUVROG

*HPRORJLFDOLGHQWLILFDWLRQ
$ZHOOHTXLSSHGJHPWHVWLQJODERUDWRU\ HJ66()*XHEHOLQ*,$$*7$+,5&2
,1',$ LVDEOHWRGLVWLQJXLVKQDWXUDOSHDUOVIURPFXOWXUHGSHDUOVE\XVLQJDJHPRORJLFDO[
UD\WRH[DPLQHWKHFHQWHURIDSHDUO:LWKDQ[UD\LWLVSRVVLEOHWRVHHWKHJURZWKULQJVRI
WKHSHDUOZKHUHWKHOD\HUVRIFDOFLXPFDUERQDWHDUHVHSDUDWHGE\WKLQOD\HUVRIFRQFKLROLQ
7KH GLIIHUHQWLDWLRQ RI QDWXUDO SHDUOV IURP WLVVXHQXFOHDWHG FXOWXUHG SHDUOV FDQ EH YHU\
GLIILFXOWZLWKRXWWKHXVHRIWKLV[UD\WHFKQLTXH
1DWXUDO DQG FXOWXUHG SHDUOV FDQ EH GLVWLQJXLVKHG IURP LPLWDWLRQ SHDUOV XVLQJ D
PLFURVFRSH$QRWKHUPHWKRGRIWHVWLQJIRULPLWDWLRQVLVWRUXEWKHSHDUODJDLQVWWKHVXUIDFH
RIDIURQWWRRWK,PLWDWLRQSHDUOVDUHFRPSOHWHO\VPRRWKEXWQDWXUDODQGFXOWXUHGSHDUOVDUH
FRPSRVHGRIQDFUHSODWHOHWVZKLFKIHHOVOLJKWO\JULWW\

5HFHQWSHDUOSURGXFWLRQ
&KLQDKDVUHFHQWO\RYHUWDNHQ-DSDQLQDNR\DSHDUOSURGXFWLRQ-DSDQKDVDOOEXWFHDVHG
LWV SURGXFWLRQ RI DNR\D SHDUOV VPDOOHU WKDQ PP -DSDQ PDLQWDLQV LWV VWDWXV DV D SHDUO
SURFHVVLQJ FHQWHU KRZHYHU DQG LPSRUWV WKH PDMRULW\ RI &KLQHVH DNR\D SHDUO SURGXFWLRQ
7KHVHSHDUOVDUHWKHQSURFHVVHG RIWHQVLPSO\PDWFKHGDQGVRUWHG UHODEHOHGDVSURGXFWRI
-DSDQDQGH[SRUWHG

ϰϬϯ

 ,QWKHSDVWFRXSOHRIGHFDGHVFXOWXUHGSHDUOVKDYHEHHQSURGXFHGXVLQJODUJHUR\VWHUV
LQ WKH VRXWK 3DFLILF DQG ,QGLDQ 2FHDQ 7KH ODUJHVW SHDUO R\VWHU LV WKH 3LQFWDGD PD[LPD
ZKLFKLVURXJKO\WKHVL]HRIDGLQQHUSODWH6RXWK6HDSHDUOVDUHFKDUDFWHUL]HGE\WKHLUODUJH
VL]HDQGZDUPOXVWHU6L]HVXSWRPPLQGLDPHWHUDUH QRWXQFRPPRQ 6RXWK6HDSHDUOV
DUHSULPDULO\SURGXFHGLQ$XVWUDOLD,QGRQHVLDDQG3KLOLSSLQHV

3HDUOVLQMHZHOU\
7KHYDOXHRIWKHSHDUOVLQMHZHOU\LVGHWHUPLQHGE\DFRPELQDWLRQRIWKHOXVWHUFRORU
VL]H ODFN RI VXUIDFH IODZ DQG V\PPHWU\ WKDW DUH DSSURSULDWH IRU WKH W\SH RI SHDUO XQGHU
FRQVLGHUDWLRQ $PRQJ WKRVH DWWULEXWHV OXVWHU LV WKH PRVW LPSRUWDQW GLIIHUHQWLDWRU RI SHDUO
TXDOLW\DFFRUGLQJWRMHZHOHUV
$OO IDFWRUV EHLQJ HTXDO KRZHYHU WKHODUJHU WKH SHDUO WKH PRUH YDOXDEOH LW LV /DUJH
SHUIHFWO\URXQGSHDUOVDUHUDUHDQGKLJKO\YDOXHG7HDUGURSVKDSHGSHDUOVDUHRIWHQXVHGLQ
SHQGDQWV

5HIHUHQFHV

)UHG:DUG  3HDUOV )UHG:DUG*HP%RRN UG(GLWLRQ*HP*XLGHV%RRN&RPSDQ\

SJV

*,$ *HPV *HPRORJ\ PDJD]LQHQHZVDUFKLYH

+DQQL + $ -XQL   .HVKL 3HUOHQ (LQ (UNODUXQJEHGXUIWLJHU %HJULII .HVKL 3HDUOV D
WHUP LQ QHHG RI H[SODQDWLRQ =HLWVFKULIW GHU 'HXWVFKHQ *HPRORJLVFKHQ *HVHOOVFKDIW
'*HP*   ±

+RZ3HDUOVDUH)RUPHG7KH3HDUO6DF7KHRU\

KWWSZZZIWFJRYEFSJXLGHVMHZHOJGVKWP

.XQ]%RRNRIWKH3HDUO1HZ<RUN7KH&HQWXU\&RPSDQ\SDJHV 

1HLO+/DQGPDQHWDO  3HDUOV$1DWXUDO+LVWRU\+DUU\$EUDPV,QFSS

3HDUO R\VWHU IDUPLQJ DQG SHDUO FXOWXUH

KWWSZZZIDRRUJGRFUHSILHOG$%($%(KWP













ϰϬϰ

 &KDSWHU
6HULFXOWXUHDQG6HULWHFKQRORJ\


6HULFXOWXUH
6HULFXOWXUH LV WKH UHDULQJ RI VLONZRUPV IRU WKH SURGXFWLRQ RI UDZ VLON $OWKRXJK WKHUH DUH
VHYHUDO FRPPHUFLDO VSHFLHV RI VLONZRUPV %RPE\[ PRUL LV WKH PRVW ZLGHO\ XVHG DQG LQWHQVLYHO\
VWXGLHG $FFRUGLQJ WR &RQIXFLDQ WH[WV WKH GLVFRYHU\ RI VLON SURGXFWLRQ E\ % PRUL GDWHV WR DERXW
%&DOWKRXJKDUFKDHRORJLFDOUHFRUGVSRLQWWRVLONFXOWLYDWLRQDVHDUO\DVWKH<DQJVKDRSHULRG
±%& $ERXWWKHILUVWKDOIRIWKHVWFHQWXU\$'LWKDGUHDFKHGDQFLHQW.KRWDQDQGE\
$'  WKH SUDFWLFH KDG EHHQ HVWDEOLVKHG LQ ,QGLD/DWHU LW ZDV LQWURGXFHG WR (XURSH WKH
0HGLWHUUDQHDQDQGRWKHU$VLDWLFFRXQWULHV6HULFXOWXUHKDVEHFRPHRQHRIWKHPRVWLPSRUWDQWFRWWDJH
LQGXVWULHVLQDQXPEHURIFRXQWULHVOLNH&KLQDWKH5HSXEOLFRI.RUHD-DSDQ,QGLD%UD]LO5XVVLD
,WDO\DQG)UDQFH7RGD\&KLQDDQG,QGLDDUHWKHWZRPDLQSURGXFHUVWRJHWKHUPDQXIDFWXULQJPRUH
WKDQRIWKHZRUOGSURGXFWLRQHDFK\HDU
7KH WHFKQRORJ\ RI VHULFXOWXUH DQG VLON SURGXFWLRQ LV ZHOONQRZQ ,Q EULHI YDULRXV
DVSHFWVLQYROYHGLQLWDUHDVIROORZV

 0XOEHUU\ &XOWLYDWLRQ 6LONZRUPV IHHG RQ PXOEHUU\ OHDYHV +HQFH WKH UHDULQJ RI
VLONZRUPVLQYROYHVFXOWLYDWLRQRIPXOEHUU\WUHHV ZKLFK SURYLGH D UHJXODUVXSSO\RI
OHDYHV :RUPV DUH LQWURGXFHG WKURXJK ')/V 'LVHDVH )UHH /D\LQJV LH HJJV 
SURFXUHG IURP D TXDOLW\ FHQWUH FDOOHG JUDLQDJH  ,Q ,QGLD WKH EXON RI PXOEHUU\
FXOWLYDWLRQLVGRQHE\VPDOOIDUPHUV DFUHVODQG XVXDOO\LQFOXVWHUVRI
 5HDULQJ 7KH VLONZRUPV DUH DFWXDOO\ ODUYDH RI WKH VLONPRWK 7KH\ DUH UHDUHG LQ
VSHFLDOO\PDGHWUD\VLQURRPVZLWKFRQWUROOHGWHPSHUDWXUHDQGKXPLGLW\DQGUHJXODUO\
IHGPXOEHUU\OHDYHV$WDFHUWDLQVWDJHWKH\FRQYHUWWKHPVHOYHVLQWRFRFRRQV7KHVH
FRFRRQV DUH PDGH IURP D VLQJOH ILODPHQW RI PDWHULDO VHFUHWHG E\ WKH SXSD DQG
ZUDSSHGDURXQGLWVHOIIRUSURWHFWLRQ7KHVHILODPHQWVXSRQKDUGHQLQJFRQVWLWXWHVLON
2QDQDYHUDJHDFUHRISODQWDWLRQZRXOG\LHOGNJRIFRFRRQVLQDQ\HDUVWDUWLQJ
IURP')/V'HSHQGLQJXSRQZKHWKHULWLVGU\ODQGRULUULJDWHGPXOEHUU\IDUPHUV
FDQKDUYHVWWKHFRFRRQVWRWLPHVLQDQ\HDU
 5HHOLQJ7KHUHPRYDORIVLON\DUQIURPWKHFRFRRQVLVFDOOHGUHHOLQJ7KLVLVGRQHE\
ILUVW FRRNLQJ WKHP LQ ZDWHU WR UHPRYH WKH JXP ZKLFK KROGV LW WRJHWKHU DQG WKHQ
XQZLQGLQJ WKH ILODPHQWV UHHOLQJ  8VXDOO\  FRFRRQV DUH UHHOHG WRJHWKHU 7KHUH
DUHWKUHHPHWKRGVIRUUHHOLQJWKHFKDUNKDWKHVOLJKWO\PRUHDGYDQFHGFRWWDJHEDVLQ
DQGWKHFRVWO\DXWRPDWLFPDFKLQHV
 7ZLVWLQJ%HIRUHZHDYLQJWKHUDZVLONLVERLOHGLQZDWHUWRUHPRYHUHPDLQLQJJXP
G\HGDQGEOHDFKHGDQGWKHQZRYHQLQWRWKHJDUPHQW±XVXDOO\RQKDQGORRP,QVRPH
FDVHVWKHZRYHQFORWKPD\EHG\HGDQGEOHDFKHG
 6SHFLHV RI 6LONZRUPV 7KHUHDUHIRXUGLIIHUHQWVSHFLHVRIPRWKVFRFRRQVRIZKLFK
\LHOGGLIIHULQJW\SHVRIVLON

x 0XOEHUU\ 6LON LV WKH PRVW FRPPRQ DPRQJ WKHP FRQWULEXWLQJ WR QHDUO\  RI
ZRUOG¶V VLON SURGXFWLRQ ,W LV SURGXFHG IURP WKH FRFRRQV RI WKH PRWK %RPE\[ PRUL
)LJXUH   :LWKLQ WKH VSHFLHV WKHUH DUH PDQ\ YDULHWLHV PDLQO\ GLIIHUHQWLDWHG
DFFRUGLQJWRWKHQXPEHURIJHQHUDWLRQVSURGXFHG DQQXDOO\XQGHUQDWXUDOFRQGLWLRQV
7KHQ K\EULGV RI YDULRXV NLQGV KDYH DOVR EHHQ GHYHORSHG 0XOWLYROWLQH YDULHWLHV

ϰϬϱ


5HDULQJ+DELWDW

x 'LVLQIHFWHGJODVVSHWULGLVKHV
x )LOWHUSDSHURUSDSHUWRZHOLQJ
x 6SUD\PLVWHU
x &LUFXODUVKHHWRISDUDIILQSDSHUZKLFKILWVLQVLGHWKHSHWULGLVK
x (QRXJKDUWLILFLDOGLHWIRUHDFKODUYDLQVWDU
x $OFRKROWRUHGXFHIXQJDOJURZWKRQDUWLILFLDOIRRG

)RRG

x &RPSOHWH LQVWUXFWLRQV VKRXOG EH SURYLGHG ZLWK WKH SXUFKDVHG DUWLILFLDO IRRG 7KH
IROORZLQJ LQIRUPDWLRQ LV JOHDQHG IURP WKH &DUROLQD %LRORJLFDO 6XSSO\ &RPSDQ\
LQIRUPDWLRQDOVKHHW
x )LUVWLQVWDUODUYD'LSRQHEDURIGLHWLQZDWHUDQGUHPRYHZKHQWKHZDWHULVDEVRUEHG
5HPRYHH[FHVV ZDWHU ZLWK SDSHU WRZHO3ODFHDPRLVW SLHFH RI ILOWHU SDSHU RU SDSHU
WRZHOLQWKHERWWRPRIWKHSHWULGLVKDQGFRYHUZLWKDVKHHWRISDUDIILQSDSHU3ODFH
WKH PRLVWHQHG GLHW RQ WKH SDUDIILQ SDSHU DQG WUDQVIHU WKH ODUYDH &RYHU WKH GLHW DQG
ODUYDZLWKDVKHHW RI SDUDIILQ SDSHU &KHFN WKH GLHW GDLO\DQGDGGGURSV RIZDWHUWR
NHHSLWPRLVW
x 6HFRQG DQG WKLUG LQVWDU ODUYD $IWHU IRXU GD\V WKH ODUYD ZLOO VWRS HDWLQJ DQG PROW
$IWHU PROWLQJ FOHDQ DQG GLVLQIHFW WKH GLVK RU XVH D QHZ VWHULOH GLVK 8VH WKH VDPH
VHWXSZLWKRXWWKHPRLVWILOWHUSDSHU7KHWKLUGLQVWDUODUYDZLOOQHHGDWOHDVWWZRSHWUL
GLVKHVDQGZLOOHDWDWOHDVWWZREDUVRIGLHW
x )RXUWK DQG )LIWK LQVWDU ODUYD 0DNH VXUH WKH ODUYD KDYH HQRXJK URRP DQG SURYLGH
DGGLWLRQDOSHWULGLVKHVDVQHHGHG7KHWRSVKHHWRISDUDIILQSDSHULVQRORQJHUQHHGHG
&RQWLQXHWRFKHFNWKHGLHWDQGNHHSLWPRLVW,IPROGDSSHDUVUHPRYHWKHODUYDHDQG
DGG RQH RU WZR GURSV RI GLVLQIHFWDQW DOFRKRO $OORZ WKH DOFRKRO WR HYDSRUDWH DQG
UHDVVHPEOHVHWXS )LJXUH 

:DWHU
7KHDUWLILFLDOGLHWPXVWEHPRLVWHQHGZLWKZDWHUEHIRUHWKHODUYDHFDQHDWLW
7DNLQJ&DUH
&OHDQLQJ

x )UDVV GURSSLQJV QHHGVWREHUHPRYHGIUHTXHQWO\WRGLVFRXUDJHPROG*HQWO\UHPRYH

WKH ZDWHU FRQWDLQHU DQG GXPS RXW WKH IUDVV (YHU\ WLPH \RX FKDQJH WKH IRRG SODQW
ULQVHRXWWKHFRQWDLQHUDQGWKRURXJKO\GU\LW3HULRGLFDOO\ZDVKWKHZDWHUFRQWDLQHUIRU
WKHIRRGSODQW
x 5HSODFH WKH ILOWHU SDSHU DQG SDUDIILQ SDSHU HYHU\ WLPH \RX JLYH WKH ODUYDH QHZ
DUWLILFLDOGLHW6WHULOHSHWULGLVKHVDUHVWURQJO\UHFRPPHQGHGWRUHGXFHIXQJDOJURZWK

5DLVLQJ<RXQJ
1HZO\ KDWFKHG ODUYDH FDQ EH WUDQVIHUUHG E\ XVLQJ D VPDOO SDLQW EUXVK 2OGHU ODUYDH FDQ EH
JHQWO\SLFNHGXSZLWK\RXUKDQGV:KHQWKHILIWKLQVWDUODUYDEHJLQVWRVKULQN DIWHUVL[WKWRHLJKWK
GD\ SUHSDUHDFRFRRQQHVW8VLQJFHOORSKDQHSDSHURUSDSHUWRZHOVPDNHDUROORISDSHUE\WZLVWLQJ
RQHHQGDQGSODFLQJWZRRUPRUHODUYDHLQLW7ZLVWWKHRWKHUHQGFORVHG6WRUHWKHUROOVLQWKHGDUNDW

ϰϬϴ

 ƒ& ƒ) ,WWDNHVWKHODUYDWKUHHGD\VWRVSLQWKHFRFRRQDQGWKHQWZRWRWKUHHGD\VWRPROWLQWRD
SXSD %\ FXWWLQJ WKH HQG RI WKH FRFRRQ D SXSD FDQ EH JHQWO\ UHPRYHG IURP WKH FRFRRQ IRU
H[DPLQDWLRQDQGUHWXUQHGWRWKHFRFRRQDIWHUREVHUYDWLRQ$OWKRXJKWKHDGXOWVGRQRWIO\WKHPRWKV
KDYHGHOLFDWHZLQJVWKDWFDQEHGDPDJHGE\KDQGOLQJ
,I\RXRUGHUHGVLONZRUPHJJVWKHHJJVVKRXOGEHSODFHGLQDSHWULGLVK$IWHUVHYHQGD\VWKH
HJJVZLOOEHJLQWRKDWFKDQGFRQWLQXHIRURQHWRWZRZHHNV2QFHWKHILUVWHJJVKDYHKDWFKHGFKHFN
WKHGLVKHYHU\GD\IRUQHZKDWFKOLQJV$GD\RUWZREHIRUHKDWFKLQJWKHHJJZLOOGDUNHQDURXQGWKH
HGJH 7UDQVIHU QHZO\ KDWFKHG ODUYDH ZLWK D ILQH SDLQW EUXVK WR DUWLILFLDO FXOWXUH RU IRRG SODQW ,I
DGXOWVFRSXODWHLQFDSWLYLW\WKHIHPDOHZLOOOD\HJJVZLWKLQKRXUV7KHVHHJJVZLOOQRWKDWFKIRU
VRPHWLPHDQGFDQEHVWRUHG
3UHFDXWLRQV

x ,I \RX FRPPLW WR IHHGLQJ WKH FDWHUSLOODU PXOEHUU\ OHDYHV PDNH VXUH \RX FDQ REWDLQ
SOHQW\RIOHDYHV2QFHWKHFDWHUSLOODUVKDYHHDWHQOHDYHVWKH\ZLOOQRWHDWWKHDUWLILFLDO
GLHW
x 7U\WRPDLQWDLQWKHWHPSHUDWXUHEHWZHHQƒ)WRƒ)HVSHFLDOO\GXULQJWKHILUVWWKUHH
LQVWDUV ,I \RXKDYHDFFHVVWRDQ LQFXEDWRU NHHSLW DW ƒ) ƒ&  7KHODWHULQVWDUV
FDQEHUHDUHGZLWKRUZLWKRXWDQLQFXEDWRU

'RQRWSODFHWKHUHDULQJFRQWDLQHUZKHUHGLUHFWVXQOLJKWZLOOKLWWKHFRQWDLQHU7KH
ODUYDHFDQHDVLO\RYHUKHDWDQGGLH

3URGXFWLRQ

6WDJHVRISURGXFWLRQ
7KHVWDJHVRISURGXFWLRQDUHDVIROORZV




ϰϬϵ

 
)LJXUH6WDJHVRI6LONSURGXFWLRQ

 7KHVLONPRWKOD\VHJJV
 :KHQWKHHJJVKDWFKWKHFDWHUSLOODUVDUHIHGPXOEHUU\OHDYHV
 :KHQWKHVLONZRUPVDUHDERXWGD\VROGWKH\DUHWLPHVKHDYLHUWKDQZKHQ
WKH\KDWFKHG7KH\DUHQRZUHDG\WRVSLQDVLONFRFRRQ
 7KH VLON LV SURGXFHG LQ WZR JODQGV LQ WKH VLONZRUP V KHDG DQG WKHQ IRUFHG RXW LQ
OLTXLGIRUPWKURXJKRSHQLQJVFDOOHGVSLQQHUHWV
 7KHVLONVROLGLILHVZKHQLWFRPHVLQFRQWDFWZLWKWKHDLU
 7KHVLONZRUPVSLQVDSSUR[LPDWHO\ PLOHRIILODPHQWDQGFRPSOHWHO\HQFORVHVLWVHOI
LQDFRFRRQLQDERXWWZRRUWKUHHGD\VEXWGXHWRTXDOLW\UHVWULFWLRQVWKHDPRXQWRI
XVDEOH VLON LQ HDFK FRFRRQ LV VPDOO $V D UHVXOW  VLONZRUPV DUH UHTXLUHG WR
SURGXFHNJRIVLON
 7KHVLONZRUPWKHQPHWDPRUSKRVHVDQGFKDQJHVLQWRDPRWKKRZHYHUWKHVLONZRUP
LV XVXDOO\ NLOOHG ZLWK KHDW EHIRUH LW UHDFKHV WKLV VWDJH 7KH VLONZRUPV DUH NLOOHG
EHFDXVHRQFHWKH\UHDFKWKHPRWKVWDJHWKHPRWKVHFUHWHVDIOXLGWRGLVVROYHWKHVLON
VRLWFDQHPHUJHIURPWKHFRFRRQ7KLVGDPDJHVWKHFRFRRQDQGWKHVLONWKHQEHFRPHV
DORZHUTXDOLW\6RPHVLONZRUPVDUHDOORZHGWROLYHWREHXVHGIRUEUHHGLQJ
 7KHVLONLVREWDLQHGIURPWKHXQGDPDJHGFRFRRQVE\EUXVKLQJWKHFRFRRQWRILQGWKH
RXWVLGHHQGVRIWKHILODPHQW
 7KH VLON ILODPHQWV DUH WKHQ ZRXQG RQ D UHHO 2QH FRFRRQ FRQWDLQV DSSUR[LPDWHO\
 \DUGV RI VLON ILODPHQW 7KH VLON DW WKLV VWDJH LV NQRZQ DV UDZ VLON -XVW RQH
WKUHDGFRQVLVWVRILQGLYLGXDOVLONILODPHQWV7KLVFRXOGOHDGWRDWOHDVW\DUGV
LQDZKROHFRFRRQ
$\DUQFDQQRZEHIRUPHGE\FRPELQLQJVHYHUDOWKUHDGVRIVLON
(VWLPDWHG LQYHVWPHQWV RI 5V WR  H[FOXGLQJ FRVW RI ODQG DQG UHDULQJ
VSDFH LVVXIILFLHQWIRUXQGHUWDNLQJPXOEHUU\FXOWLYDWLRQDQGVLONZRUPUHDULQJLQRQH
DFUHRILUULJDWHGODQG
0XOEHUU\ WDNHV RQO\ VL[ PRQWKV WR JURZ IRU FRPPHQFHPHQW RI VLONZRUP UHDULQJ
0XOEHUU\RQFHSODQWHGZLOOJRRQVXSSRUWLQJVLONZRUPUHDULQJ\HDUDIWHU\HDUIRU±
\HDUVGHSHQGLQJRQLQSXWVDQGPDQDJHPHQWSURYLGHG )LJXUH 

ϰϭϬ

 )LYHFURSVFDQEHWDNHQLQRQH\HDUXQGHUWURSLFDOFRQGLWLRQV
%\DGRSWLQJVWLSXODWHGSDFNDJHRISUDFWLFHVDIDUPHUFDQDWWDLQQHWLQFRPHOHYHOVXS
WR5VSHUDFUHSHUDQQXP

&XOWLYDWLRQ



)LJXUH&RFRRQ

6LON PRWKV OD\ HJJV RQ VSHFLDOO\ SUHSDUHG SDSHU 7KH HJJV KDWFK DQG WKH FDWHUSLOODUV
VLONZRUPV  DUH IHG IUHVK PXOEHUU\ OHDYHV $IWHU DERXW  GD\V DQG  PROWLQJV WKH
FDWHUSLOODUV DUH  WLPHV KHDYLHU WKDQ ZKHQ KDWFKHG DQGDUH UHDG\ WR EHJLQ VSLQQLQJ D
FRFRRQ )LJXUH $VWUDZIUDPHLVSODFHGRYHUWKHWUD\RIFDWHUSLOODUVDQGHDFKFDWHUSLOODU
EHJLQV VSLQQLQJ D FRFRRQ E\ PRYLQJ LWV KHDG LQ D ILJXUH  SDWWHUQ 7ZR JODQGV SURGXFH
OLTXLGVLONDQGIRUFHLWWKURXJKRSHQLQJVLQWKHKHDGFDOOHGVSLQQHUHWV/LTXLGVLONLVFRDWHGLQ
VHULFLQ D ZDWHUVROXEOH SURWHFWLYH JXP DQG VROLGLILHV RQ FRQWDFW ZLWK WKH DLU :LWKLQ ±
GD\V WKH FDWHUSLOODU VSLQV DERXW  PLOH RI ILODPHQW DQG LV FRPSOHWHO\ HQFDVHG LQ DFRFRRQ
7KH VLON IDUPHUV WKHQ NLOO PRVW FDWHUSLOODUV E\ KHDW OHDYLQJ VRPH WR PHWDPRUSKRVH LQWR
PRWKVWREUHHGWKHQH[WJHQHUDWLRQRIFDWHUSLOODUV

3URSHUWLHV

3K\VLFDOSURSHUWLHV

6LON ILEHUV IURP WKH %RPE\[ PRUL VLONZRUP KDYH D WULDQJXODU FURVV VHFWLRQ ZLWK
URXQGHGFRUQHUVȝPZLGH7KHILEURLQKHDY\FKDLQLVPRVWO\FRPSRVHGRIEHWDVKHHWV
GXH WR D PHU DPLQR DFLG UHSHDW VHTXHQFH *$*$*6*$$*>6*$*$*@< ZLWK VRPH
YDULDWLRQV7KHIODWVXUIDFHVRIWKHILEULOVUHIOHFWOLJKWDWPDQ\GLIIHUHQWDQJOHVJLYLQJVLOND
QDWXUDO VKLQH 7KH FURVVVHFWLRQ IURP RWKHU VLONZRUPV FDQ YDU\ LQ VKDSH DQG GLDPHWHU
FUHVFHQWOLNH IRU $QDSKH DQG HORQJDWHG ZHGJH IRU WXVVDK 6LONZRUP ILEHUV DUH QDWXUDOO\
H[WUXGHG IURP WZR VLONZRUP JODQGV DV D SDLU RI SULPDU\ ILODPHQWV EULQ  ZKLFK DUH VWXFN
WRJHWKHUZLWKVHULFLQSURWHLQVDFWLQJOLNHJOXHWRIRUPDEDYH%DYHGLDPHWHUVIRUWXVVDKVLON

ϰϭϭ

FDQUHDFKȝP6LONKDVDVPRRWKVRIWWH[WXUHWKDWLVQRWVOLSSHU\XQOLNHPDQ\V\QWKHWLF
ILEHU,WVGHQLHULVJGZKHQGU\DQGJGZKHQPRLVW

6LONLVRQHRIWKHVWURQJHVWQDWXUDOILEHUVEXWORVHVXSWRRILWVVWUHQJWKZKHQZHW
,WKDVDJRRGPRLVWXUHUHJDLQRI,WVHODVWLFLW\LVPRGHUDWHWRSRRULIHORQJDWHGHYHQD
VPDOO DPRXQW LW UHPDLQV VWUHWFKHG ,W FDQ EH ZHDNHQHG LI H[SRVHG WR WRR PXFK VXQOLJKW ,W
PD\DOVREHDWWDFNHGE\LQVHFWVHVSHFLDOO\LIOHIWGLUW\

6LONLVDSRRUFRQGXFWRURIHOHFWULFLW\DQGWKXVVXVFHSWLEOHWRVWDWLFFOLQJ

8QZDVKHG VLON FKLIIRQ PD\ VKULQN XS WR  GXH WR D UHOD[DWLRQ RI WKH ILEHU
PDFURVWUXFWXUH 6R VLON VKRXOG HLWKHU EH SUHZDVKHG EHIRUH JDUPHQW FRQVWUXFWLRQ RU GU\
FOHDQHG'U\FOHDQLQJPD\VWLOOVKULQNWKHFKLIIRQXSWR2FFDVLRQDOO\WKLVVKULQNDJHFDQ
EHUHYHUVHGE\DJHQWOHVWHDPLQJZLWKDSUHVVFORWK7KHUHLVDOPRVWQRJUDGXDOVKULQNDJHRU
VKULQNDJHGXHWRPROHFXODUOHYHOGHIRUPDWLRQ

&KHPLFDOSURSHUWLHV

6LON LV PDGH XS RI WKHDPLQR DFLGV *O\6HU *O\$OD DQG IRUPV %HWD SOHDWHG VKHHWV
,QWHUFKDLQ +ERQGV DUH IRUPHG ZKLOH VLGH FKDLQV DUH DERYH DQG EHORZ WKH SODQH RI WKH +
ERQGQHWZRUN

7KH KLJK SURSRUWLRQ   RI JO\FLQH ZKLFK LV VPDOO DOORZV WLJKW SDFNLQJ DQG WKH
ILEHUV DUH VWURQJ DQG UHVLVWDQW WR VWUHWFKLQJ 7KH WHQVLOH VWUHQJWK LV GXH WR WKH PDQ\
LQWHUVHHGHGK\GURJHQERQGV6LQFHWKHSURWHLQIRUPVD%HWDVKHHWZKHQVWUHWFKHGWKHIRUFHLV
DSSOLHGWRWKHVHVWURQJERQGVDQGWKH\GRQRWEUHDN

6LONLVUHVLVWDQWWRPRVWPLQHUDODFLGVEXWZLOOGLVVROYHLQVXOIXULFDFLG,WLV\HOORZHGE\
SHUVSLUDWLRQ

%LRFKHPLVWU\RIVLONZRUP

,QVHFWV PDLQO\ EHORQJ WR WZR IDPLOLHV YL] 6DWXUQLGDH DQG%RPE\FLGDH ZKLFK VSLQV
VLON ILEUH %RPE\[ PRUL EHORQJV WR %RPE\FLGDH SURGXFHV D GHOLFDWH WZLQ WKUHDG RI VLON
ILEURLQZKLFKLVFRDWHGE\DSURWHFWLYHFRYHURIVHULFLQ6LONSURWHLQLVDNLQGRISURWHLQOLNH
FROODJHQHODVWLQNHUDWLQILEURLQVSRUJLQHWFLVDQHVVHQWLDOFRQVWLWXHQWRIFRFRRQILODPHQW

7KHVLONILEUHSURWHLQLVV\QWKHVL]HGE\VLONJODQGFHOOVDQGVWRUHGLQWKHOXPHQRIWKH
VLON JODQGV 6XEVHTXHQWO\ LW LV FRQYHUWHG LQWR VLON ILEUHV :KHQ WKH VLONZRUPV VHFUHWH WKH
OLTXLGVLONGXULQJWKHVSLQQLQJLWSDVVHVWKURXJKWKHDQWHULRUJODQGDQGH[SHOOHGRXWWKURXJK
WKH VSLQQHUHW RSHQLQJ 4XDQWLW\ DQG QDWXUH RI VHULFLQ DUH IXQGDPHQWDO FKDUDFWHULVWLFV LQ
FRQIHUULQJGLVWLQFWLYHWUDLWVWRWKHFRFRRQ

6HULFLQLVLQVROXEOHLQFROGZDWHUKRZHYHULWLVHDVLO\K\GURO\]HGZKHUHE\WKHORQJ
SURWHLQPROHFXOHVEUDNHVGRZQWRVPDOOHUIUDFWLRQVZKLFKDUHHDVLO\GLVSHUVHGRUVROXELOLVHG
LQKRWZDWHU6HULFLQSURWHLQLVXVHIXOEHFDXVHRILWVVSHFLDOSURSHUWLHVYL]UHVLVWVR[LGDWLRQ
DQWLEDFWHULDO 89 UHVLVWDQW DQG DEVRUEV DQG UHOHDVH PRLVWXUH HDVLO\ LQKLELWRU\ DFWLYLW\ RI
W\URVLQH DQG NLQDVH HWF )LJXUH   6HULFLQ D PDMRU FRPSRQHQW RI VLON ILEUH KDV EHHQ
VHOHFWLYHO\UHPRYHGIURPILEURLQGXULQJWKHVLONPDQXIDFWXULQJSURFHVVWRPDNHVLONOXVWURXV

ϰϭϮ

 
,W LV HVWLPDWHG WKDW RXW RI DERXW  PLOOLRQ WRQV IUHVK ZHLJKW  RI FRFRRQV SURGXFHG
ZRUOGZLGHDSSUR[LPDWHO\WRQVRIGU\FRFRRQDUHJHQHUDWHGWKDWKDYHWRQV
RIUHFRYHUDEOHVHULFLQ,QGLDQSURGXFWLRQRIWRQVRIVLONFDQEHVRXUFHRIDERXWWR
 WRQV RIVHULFLQSHU\HDU,IWKLV VHULFLQSURWHLQLV UHFRYHUHGDQG UHF\FOHG LW ZRXOG EH D
VLJQLILFDQWHFRQRPLFDQGVRFLDOEHQHILW

6LON*ODQG

7KHQDWXUDOVLONV\QWKHVL]HGE\WKHVLONZRUPDQGVSXQLQWKHIRUPRIDVLONFRFRRQLV
RULJLQDOO\ V\QWKHVL]HG LQ WKH VLON JODQG 6LON JODQG RI % PRUL LV D W\SLFDO H[RFULQH JODQG
VHFUHWLQJ ODUJH DPRXQW RI VLON SURWHLQV ,W LV D SDLUHG RUJDQ FRQVLVWLQJ RI PRGLILHG
ODELDOVDOLYDU\JODQGVORFDWHGDWWKHWZRODWHUDOVLGHVXQGHUWKHDOLPHQWDU\FDQDO(DFKJODQG
LV EDVLFDOO\ D WXEH PDGH RI JODQGXODU HSLWKHOLXP ZLWK WZR URZV RI FHOOV VXUURXQGLQJ WKH
OXPHQ

7KHFHOOVFRQVWLWXWLQJWKHJODQGDUHKXJHSRO\SORLGFHOOVHDFKZLWKH[WUHPHO\UDPLILHG
QXFOHXVFRQWDLQLQJQXPHURXVQXFOHROL1XFOHDUUDPLILFDWLRQ GHYHORSV JUDGXDOO\ DV WKHODUYD
JURZV DQG UHDFKHV FRQVSLFXRXV VL]H LQ WKH WK DQG WK LQVWDUV 5DPLILFDWLRQ FRQVLGHUDEO\
HQODUJHVWKHQXFOHDUVXUIDFHDQGDSSDUHQWO\IDFLOLWDWHVWKHWUDQVIHURIPDWHULDOVUHODWHGWRWKH
VLON V\QWKHVLV EHWZHHQ WKH QXFOHXV DQG WKH F\WRSODVP $FFRUGLQJ WR LWV PRUSKRORJ\ DQG
IXQFWLRQWKHVLONJODQGFDQEHGLYLGHGLQWRWKUHHGLVWLQFWUHJLRQV )LJXUH 

7KH SRVWHULRU SDUW DERXW  FP ORQJ DQG LV FRPSRVHG RI DERXW  VHFUHWDU\ FHOOV
ZKLFKV\QWKHVL]HVLONILEURLQ7KHPLGGOHVLONJODQGLQWKHOXPHQRIZKLFKVLONSURWHLQVDUH
VWRUHGXQWLOVSLQQLQJLVDERXWFPORQJDQGFRQWDLQVDERXWVHFUHWRU\FHOOVSURGXFLQJVLON
VHULFLQWKHSURWHLQZKLFKFHPHQWVWKHILEURLQWKUHDGRIWKHFRFRRQ7KHDQWHULRUSDUWDERXW
FP ORQJ LV D WKLQ GXFW FRPSRVHG RI DERXW  FHOOV ZLWK QR NQRZQ VHFUHWRU\ IXQFWLRQ
%RPE\[ PRUL VLON JODQG VHFUHWHV RQH ILEURLQ DQG WKUHH OD\HUV RI VHULFLQ IURP WKH HDFK
SRVWHULRUDQGPLGGOHVLONJODQGLQDQRUPDOODUYD

7KH1GV'PXWDQWLVVLONILEURLQVHFUHWLRQGHILFLHQW,QWKHPXWDQWDGLVXOILGHOLQNDJH
EHWZHHQWKHKHDY\ + FKDLQDQGOLJKW / FKDLQLVQRWIRUPHGEHFDXVHRISDUWLDOGHOHWLRQRI
WKH /FKDLQ JHQH ZKLFK LV HVVHQWLDO IRU WKH LQWHUFHOOXODU WUDQVSRUW DQG VHFUHWLRQ RI ILEURLQ
7KH LQDFWLYLW\ RI WKH PXWDQW /FKDLQ LV WKH SRVVLELOLW\ RI XVLQJ WKH 1GV' PXWDQW IRU WKH
HIILFLHQW SURGXFWLRQ RI UHFRPELQDQWV LQ WKH VLONZRUP 7KH SRVWHULRU VLON JODQGV DUH QRW
VXIILFLHQWO\GHYHORSHGDQGWKHOLTXLGILEURLQLVVFDUFHO\VHFUHWHGEXWWKHUHLVQRVXFKGLVRUGHU
LQWKHPLGGOHVLONJODQGV$QHZVLONZRUPUDFHZKLFKSURGXFHVRQO\VHULFLQLQ-DSDQLQWKH
QDPHRI³6HULFLQ+RSH´LQWURGXFLQJ1GV'PXWDQW7KHDQDO\VLVRISURWHLQYDULHW\RIPLGGOH
VLON JODQG FHOOV RI WKH ILIWK LQVWDU ODUYDH RI VLONZRUP % PRUL DW GLIIHUHQW GHYHORSPHQWDO
VWDJHV


ϰϭϰ

 
)LJXUH6FKHPDWLFUHSUHVHQWDWLRQRIVLONJODQGRIVLONZRUP %RPE\[PRUL/ 

7KHVLONJODQGKDV WKHFDSDFLW\WRSURGXFHODUJH DPRXQW RI VLON SURWHLQV 7R XVH DV D
IRUHLJQ SURWHLQV SLJJ\%DF YHFWRUV ZHUH GHYHORSHG WR H[SUHVV WUDQVJHQHV LQ WKH VLON JODQG
XVLQJ VLON JHQH SURPRWHUV WR GULYH WKH H[SUHVVLRQ RI WKH LQWHJUDWHG IRUHLJQ JHQHV 6HYHUDO
SURPRWHUVZHUHWHVWHGWRV\QWKHVL]HIRUHLJQSURWHLQVOLNHSURFROODJHQ,,,RUJOREXODURQHVDQG
VXFFHVVIXOO\SURGXFHGLQWKHVLONJODQGVRI%RPE\[PRUL

&RPSRVLWLRQRIWKHFRFRRQILODPHQW

7KH VLON ILEUH LV DOPRVW D SXUH SURWHLQ ILEUH FRPSRVHG RI WZR W\SHV RI SURWHLQV YL]
VHULFLQDQGILEURLQ6HULFLQLVFKHPLFDOO\DQRQILODPHQWRXVSURWHLQ%HVLGHVVHULFLQUDZVLON
DOVR FRQWDLQ RWKHU QDWXUDO LPSXULWLHV QDPHO\ IDW DQG ZD[HV LQRUJDQLF VDOWV DQG FRORXULQJ
PDWHU 7DEOH 7KHRXWHUOD\HURIWKHVLONILEUHUHYHDOHGWKDWWKHVHULFLQFRQWHQWLVPRUHLQ
RXWHUOD\HUZKHUHLQILEURLQFRQWHQWLVOHVV 7DEOH 

7DEOH&RPSRVLWLRQRIVLONLQ%RPE\[PRUL
&RPSRQHQW 
)LEURLQ 
6HULFLQ 
:D[PDWWHU 
&DUERK\GUDWHV 
,QRUJDQLFPDWWHU 
3LJPHQW 
7RWDO 








ϰϭϱ

 7DEOH&KDQJHLQFRFRRQILODPHQWRIDSDUWLFXODUVLONZRUPKDYLQJGLVVLPLODUOD\HUV
/D\HU )LEURLQ 6HULFLQ (WKHUVRDNHG $VKFRQWHQW
   VXEVWDQFH   
    
    
    
    
    


6LON3URWHLQIURPWKHVLONJODQG

6LONILEURLQVHFUHWHGLQWKHOXPHQRISRVWHULRUVLONJODQG 36* RI %PRULFRQVLVWVRI
WKUHH SURWHLQ FRPSRQHQW +LJK + FKDLQ  N 'D /RZ /   FKDLQ  N 'D DQG
*O\FRSURWHLQ 3  N 'D 7KHVH WKUHH W\SHV RI ILEURLQ +FKDLQ /FKDLQ DQG 3   DUH
FRPPRQ DPRQJ GLIIHUHQW VLON SURGXFLQJ LQVHFWV LQ /HSLGRSWHUD DOWKRXJK WKH ILEURLQ RI
6DWXUQLGDHVSHFLHVVHFUHWHGDVGLPHURI+FKDLQ

4XDQWLWDWLYHHQ]\PH OLQNHG LPPXQRVRUEHQW DVVD\ (/,6$  ZLWK VSHFLILFDQWLERG\IRU
HDFKSURWHLQFRPSRQHQWVKRZHGWKDWWKHPRODUUDWLRRI+FKDLQ/FKDLQDQG3LVIRU
WKHILEURLQVHFUHWHGLQWRWKHSRVWHULRUVLONJODQG 36* 7KH1OLQNHGROLJRVDFFKDULGHFKDLQRI
3KDVEHHQVXJJHVWHGWREHLQYROYHGLQWKHODWHULQWHUDFWLRQV)LEURKH[DPHUZDVSURSRVHG
DV D IXQFWLRQDO QDPH RI 3 DQG LWV FHQWUDO UROH LV PDLQWDLQLQJ WKH VWUXFWXUH RI HOHPHQWDU\
XQLW7KHGLVXOILGHOLQNDJHEHWZHHQ&\VRIWKH/FKDLQDQG&\VFRIWKH+FKDLQLVQRW
UHVSRQVLEOHIRUWKHPDLQWHQDQFHRIWKHRQFHIRUPHGHOHPHQWDU\XQLW%XWWKH+/OLQNDJHLV
HVVHQWLDOIRUWKHODUJHVFDOHSURGXFWLRQRIILEURLQEHFDXVHILEURLQLVUHWDLQHGLQHQGRSODVPLF
UHWLFXOXPLQWKHDEVHQFHRIGLVXOILGHOLQNDJHEHWZHHQWKH+DQG/FKDLQV7KHILQHVWUXFWXUDO
FKDQJHRIOLTXLGFROXPQDUILEURLQLQWKHOXPHQRIVLONJODQGZDVREVHUYHGGXULQJWKHSDVVDJH
IURP WKH SRVWHULRU WR WKH DQWHULRU VLON JODQG GXULQJ WKH VSLQQLQJ VWDJH WR DQDO\]H WKH
PHFKDQLVPLQYROYHGLQWKHIRUPDWLRQRIDVLQJOHFRFRRQILODPHQW

,Q WKH SRVWHULRU SDUW RI WKH SRVWHULRU VLON JODQG WKH FROXPQDU ILEURLQ ORFDWHG LQ WKH
OXPHQFRQVLVWVRIQXPHURXVVSKHULFDOPDVVHVRIILEURLQILEUHV 0))V 7KHVH0))VDGKHUHG
FORVHO\WRJHWKHUVKRZLQJDKLJKHUFRQFHQWUDWLRQLQWKHSRVWHULRUSDUWRIWKHPLGGOHVLONJODQG
DQG EHFRPH KRPRJHQHRXV DQG FRPSDFW LQ WKH DQWHULRU VLON JODQG %\ WKH REVHUYDWLRQ RI
YDULRXVSRUWLRQRIVLONJODQGLWLVFRQFOXGHGWKDWWKHFRFRRQILODPHQWLVFRPSRVHGRIRULHQWHG
HOHPHQWDU\ILEURLQILEUHVDQGWKHVHILEUHVDUHGHULYHGIURP0))VDVWKH\XQGHUJRVWUXFWXUDO
FKDQJH GXULQJ WKH SDVVDJH WKURXJK WKH VLON JODQG OXPHQ .RPDWVX   SRVWXODWHG
PROHFXODUDJJUHJDWLQJVWUXFWXUHRIVHULFLQDQGLWVFKDQJHV

7KH SDUW RI WKH OLTXLG VHULFLQ LQ WKH PLGGOH VLON JODQG WKDW LV HDVLO\ FU\VWDOOL]HG E\
GU\LQJLVSRVVLEO\PDGHRIDPLQRDFLGUHVLGXHVZLWKVKRUWVLGHFKDLQVDQGLVIROGHGLQWRWKH
JOREXODU PDWUL[ PDGH RI VWUHWFKHV ZLWK ORQJHU VLGHFKDLQV FU\VWDOOL]LQJ OHVV UHDGLO\ DQG RQ
GU\LQJ EHFRPH ILOP RI XQRULHQWHG FU\VWDO VWUXFWXUH :KHQ WKLV ILOP LV VZROOHQ LQ ZDWHU
VWUHWFKHG DQG GULHG LW FKDQJHV WR RULHQWHG ILEUH VWUXFWXUH +RZHYHU DV WKH RULHQWDWLRQ LV
XQVWDEOH E\ KRW ZDWHU WUHDWPHQW DQG WKXV WKHUH LV D UHYHUVLEOH UHODWLRQVKLS EHWZHHQ WKH
RULHQWDWLRQDQGQRQRULHQWDWLRQ


ϰϭϲ

 7KH ; UD\ GLIIUDFWLRQ RI ILEURLQ VKRZHG  PP WKLFN SDUDOOHO VLON ILEURLQ ILEUHV ,W LV
REVHUYHG WKDW ILEURLQ FRQVLVWV RI QRQ FU\VWDOOLQH DQG FU\VWDOOLQH UHJLRQV 7KH FU\VWDOOLQH
UHJLRQWHQGVWREHRULHQWHGDORQJ WKHILEUHD[LVEHFDXVH WKH ILEUH LV GUDZQ DV LW LVH[WUXGHG
IURPWKHVSLQQHUHWVRIWKHVLONZRUP7KHFU\VWDOOLQHVWUXFWXUHDQGPROHFXODUFRQIRUPDWLRQRI
VLONVHULFLQE\;UD\GLIIUDFWLRQLQIUDUHGVSHFWURPHWU\DQGGLIIHUHQWLDOVFDQQLQJFDORULPHWU\
RIWKHZLOGVLON $QWKHUDHDSHUQ\L$QWKHUDHD\DPDPDL3KLORVRPLDF\QWKLDULFLQL E\ERLOLQJ
LQZDWHU7KHFU\VWDOOLQHVWUXFWXUHDQGPROHFXODUFRQIRUPDWLRQRIVLONVHULFLQREWDLQHGIURP
ZLOG VLONV LV QRW SUDFWLFDOO\ GLIIHUHQW IURP WKDW RI VHULFLQ REWDLQHG IURP % PRUL 2QO\
GLIIHUHQFHLVWKDWWKHZLOGVLONVHULFLQLVUHODWLYHO\LQVROXEOHFRPSDUHGWR%PRULPDLQO\GXH
WR FKHPLFDO LQWHUDFWLRQ EHWZHHQ VLON VHULFLQ DQG LQRUJDQLF PLQRU FRPSRQHQWV RU WDQQLQV
FRQWDLQHGRULJLQDOO\LQZLOGVLON

7KHVWUXFWXUHRIDFU\VWDOOLQHIRUPRI%0RULVLONILEURLQFRPPRQO\IRXQGEHIRUHWKH
VSLQQLQJ SURFHVV NQRZQ DV VLON ,  KDV EHHQ SURSRVHG DV D UHSHDWHG -WXUQ W\SH ,, OLNH
VWUXFWXUH E\ FRPELQLQJ - REWDLQHG IURP VROLGVWDWH WZR GLPHQVLRQDO VSLQGLIIXVLRQ QXFOHDU
PDJQHWLFUHVRQDQFHDQGURWDWLRQDOHFKRGRXEOHUHVRQDQFH

7KHPROHFXODUDQGFU\VWDOVWUXFWXUHRIWKHFU\VWDOOLQHPRGLILFDWLRQVRI%PRULVLON,LV
GHWHUPLQHG E\ ; UD\ GLIIUDFWLRQ PHWKRG 7KH FHOO GLPHQVLRQV DUH HVVHQWLDOO\ WKH VDPH DV
WKRVHIRXQGLQWKHV\QWKHWLFPRGHOSRO\SHSWLGH /$OD*O\ 7KH SKLS, YDOXHVRI/$ODDQG
*OHH LQ WKH UHSHDWLQJ XQLW ƒƒ&  ƒ ƒ&  ZKLFK DUH LQ WKH EULGJH DQG IRXUWK
TXDGUDQWUHJLRQVRIWKH5DPFKDQGUDQPDSUHVSHFWLYHO\



)LJXUH&U\VWDOOLQHVWUXFWXUHRIWKHSHSWLGHFKDLQVLQVLONILEURLQ

7KH REVHUYHG PROHFXODU FRQIRUPDWLRQ KDV D ³FUDQNVKDIW´ RU D 6 VKDSHG ]LJ]DJ
DUUDQJHPHQW OHDGLQJ WR UHPDUNDEOH DJUHHPHQW RI REVHUYHG DQG FDOFXODWHG VWUXFWXUH
DPSOLWXGHVRIERWKGLSHSWLGHDQGKH[DSHSWLGHVHTXHQFHVDQGKDVDUHDVRQDEOHK\GURJHQERQG
QHWZRUNV;UD\VWUXFWXUHDQDO\VHVRIWKHFU\VWDOOLQHGRPDLQVRIILEURLQVKRZWKDWWKHSHSWLGH
FKDLQVSDFNLQIXOO\H[WHQGHGIRUPV )LJXUH 





ϰϭϳ

0ROHFXODUFRQILUPDWLRQRI6HULFLQDQGLWVWUDQVLWLRQ

6HULFLQ H[WUDFWHG IURP WKH OLTXLG VLON DQG IUHVK FRFRRQ VKHOOV RI D VLONZRUP PXWDQW
ZKLFKVHFUHWHVRQO\VHULFLQLVDUDQGRPFRLOZLWKȕVWUXFWXUHDQGQRĮKHOL[6HULFLQ
LQ DTXHRXV VROXWLRQ GLVSOD\V ERWK UDQGRP FRLO DQG ȕVWUXFWXUH EXW ODFNV ĮKHOL[ 6HULFLQV
IURP ERWK WKH OLTXLG VLON LQ WKH VLON JODQG DQG WKH FRFRRQ ILODPHQW ZHUH VWXGLHG DQG
FRQILUPHG WKH UHODWLRQVKLS EHWZHHQ VROXELOLW\ LQ KRW ZDWHU DQG PROHFXODUFRQIRUPDWLRQ 7R
GDWHPRVWH[SHULPHQWDOHYLGHQFHVLQGLFDWHWKDWVHULFLQH[LVWVPDLQO\LQWKHUDQGRPFRLORUȕ
VWUXFWXUH,WLVEHOLHYHGWKDWȕVWUXFWXUHLVLQWULQVLFWROLTXLGVLON$QDO\VLVEDVHGRQFLUFXODU
GLFKURLVP VSHFWUXP LQGLFDWHG WKDW VHULFLQ H[WUDFWHG IURP OLTXLG VLON IRU  PLQXWHV ZLWK
ZDWHUFRQWDLQVDVPDOOIUDFWLRQ  RIĮKHOL[

'XULQJWKHGLVVROXWLRQRIWKHOLTXLGVLONLQZDWHUSDUWRIWKHVHULFLQ,9EHFRPHDZKLWH
VXVSHQVLRQGXHWRWKHFRH[LVWLQJFRFRRQ\DUQZD[EXWGRHVQRWFRDJXODWHDQGWKHEVWUXFWXUH
LVRULJLQDOO\SUHVHQWLQWKHOLTXLGVLONȕVWUXFWXUHVHULFLQLVPRUHLQVROXEOHWKDQUDQGRPFRLO
VHULFLQ7KHWUDQVLWLRQRIVHULFLQIURPLWVUDQGRPFRLOWRȕVWUXFWXUHWDNHVSODFHE\UHSHDWHG
DEVRUSWLRQ DQG GHDEVRUSWLRQ RI PRLVWXUH DQG E\ KHDWLQJ GXULQJ WKH DEVRUEHG VWDWH LH
K\JURVFRSLF FRQGLWLRQV 6HULFLQV KDYH D FURVV ȕVWUXFWXUH ZKHQ D ZDWHU VROXWLRQ RI VHULFLQ
FRQWDLQLQJGLR[DQHRUPHWKDQRO

6HULFLQIUDFWLRQZDVFORVHVWWRILEURLQLQWKHFRFRRQILODPHQWKDVPROHFXODUFKDLQVDOVR
DUUDQJHGLQFURVVȕVWUXFWXUHUDWKHUWKDQKDYLQJWKHPDLQD[LVRIFU\VWDOOLWHVRULHQWHGDWULJKW
DQJOHWRWKHILEUHD[LV7KHLQWUDPROHFXODUERQGVRIVHULFLQKDYLQJUDQGRPFRLOVDUHEURNHQ
E\ WKH DEVRUSWLRQ RI ZDWHU PROHFXOHV DQG WKH IROGHG VWUXFWXUH EHFRPHV XQIROGHG LQWR DQ
H[WHQGHGVWUXFWXUHDQGLVWUDQVIRUPHGLQWRĮȕVWUXFWXUHȕ6WUXFWXUHLVPRUHVWDEOHUHJDUGLQJ
HQHUJ\3DUWRIWKHVHULFLQWKXVWUDQVIRUPHGLQWRȕVWUXFWXUHLVIL[HGE\LWVQHZLQWHUPROHFXODU
K\GURJHQ ERQGV DQG UHPDLQV FU\VWDOOL]HG HYHQ ZKHQ WKH ZDWHU PROHFXOHV DUH UHPRYHG E\
GU\LQJ,QDQHZF\FOHRIZDWHUDEVRUSWLRQWKHFU\VWDOOLQHVWUXFWXUHDOUHDG\IRUPHGUHPDLQV
XQDIIHFWHGZKHUHDVDIXUWKHUIUDFWLRQRIUDQGRPFRLOVVWDWHFU\VWDOL]HVLQWRDEVWUXFWXUHWKHUH
E\LQFUHDVLQJWKHSRUWLRQRIȕVWUXFWXUHDQGSURPRWHVFU\VWDOL]DWLRQ+HDWLQJGXULQJPRLVWXUH
DEVRUSWLRQ DFWLYDWHV WKH WKHUPDO PRWLRQV RI VHJPHQWV DQG DFFHOHUDWHV WUDQVIRUPDWLRQ 7KXV
WKH VHULFLQ JHWV PRGLILHG LQ WKH GLUHFWLRQ RI GLIILFXOW VROXELOLW\ GXH WR UHSHDWHG PRLVWXUH
DEVRUSWLRQDQGORVV

6HULFLQOD\HUVWUXFWXUHRUVHULFLQIUDFWLRQ

6FLHQWLVWVKDYHVHSDUDWHGVHULFLQRIFRFRRQVKHOOLQWRWZRSURSRUWLRQV  ĮVHULFLQDQG
 ȕVHULFLQĮ6HULFLQLVSUHVHQWLQWKHRXWHUOD\HURIFRFRRQVKHOODQGȕVHULFLQLQWKHLQQHU
OD\HU7KHĮVHULFLQFRQWDLQVOHVVHU&DQG+DQGVRPHZKDWPRUH1DQG2WKDQWKHȕVHULFLQ
7KH VROXELOLW\ RI ĮVHULFLQ LQ WKH ERLOLQJ ZDWHU LV PRUH WKDQ ȕ VHULFLQ 1DWLYH VHULFLQ LV
PL[WXUHRIWZRVXEVWDQFHVVHULFLQ$DQG6HULFLQ%6HULFLQLQDTXHRXVVROXWLRQVREWDLQHGRQ
GHJXPPLQJ VLON LV QRW DQ LQGLYLGXDO FKHPLFDO VXEVWDQFH EXW LV D PL[WXUH RI DW OHDVW WZR
VXEVWDQFH IUDFWLRQ $ FDQ EH VHSDUDWHG E\ IUDFWLRQDO SUHFLSLWDWLRQ E\ DGGLQJ J RI
DPPRQLXPVXOSKDWHSHUPORIVHULFLQVROXWLRQ:KHQDPPRQLXPVXOSKDWHLVDGGHGWRWKH
ILOWUDWHVHULFLQ%ZLOOEHSUHFLSLWDWHG6RPHVFLHQWLVWVGHVFULEHGWKDWRQWKHFRFRRQWKUHDGWKH
VHULFLQ OD\HUV DUH IRUPHG IURP WKH RXWVLGH WR LQVLGH LQ WKH RUGHU RI , ,, ,,, WR FRYHU WKH
ILEURLQ7KUHHIUDFWLRQVRIVHULFLQZKLFKZHUHGLIIHUHQWLQVROXELOLW\DQGFDOOHGWKHPVHULFLQ
IUDFWLRQV , ,, DQG ,,, EDVHG RQ WKH RUGHU RI HDVH RI GLVVROXWLRQ LQ KRW ZDWHU DQG WKDW WKHLU
UDWLRVZHUHDSSUR[LPDWHO\%DVHGRQWKHGLIIHUHQWGHJUHHRIVROXELOLW\VHULFLQOD\HUV
FDQEHFDOOHGDV6HULFLQ$DQG6HULFLQ%RU6HULFLQĮDQGȕRU6HULFLQ,,,DQG,,,7KHVHULFLQ

ϰϭϴ

$LVPRUHVROXEOHWKDQWKHRWKHUV,WLVIRXQGWKDWRIWKHVHULFLQ,RQWKHFRFRRQILODPHQWLV
DPRUSKRXVZKHUHDV,,DQG,,,DUHFU\VWDOOLQH)RXUIUDFWLRQVRIVHULFLQYL],,,,,,DQG,9
DUHKDYLQJGLIIHUHQWVROXELOLWLHVKDUGHUWRGLVVROYHEHLQJVHULFLQ,9)RXUWKIUDFWLRQRIVHULFLQ
ZDVUHSRUWHGWRKDYHKLJKHUVSHFLILFJUDYLW\DQGFU\VWDOOLQLW\WKDQPRLVWXUHFRQWHQW

6HULFLQPD\EHVHSDUDWHGLQWRVHULFLQ,,,,,,DQG,9E\WKHLUGLIIHUHQWVROXELOLWLHVLQKRW
ZDWHUDQGDVVHVVLQJWKHGHJUHHRIVROXELOLW\E\89DEVRUSWLRQ7KHJUHDWHVWVHULFLQFRQWHQWLV
SUHVHQW LQ WKH RXWHU OD\HU RI FRFRRQ ZKHUHDV WKH OHDVW VHULFLQ SURSRUWLRQ LV SUHVHQW LQ WKH
LQQHUPRVWOD\HURIDFRFRRQ)LEURLQLVWKHSULQFLSDOZDWHULQVROXEOHSURWHLQ LHRIWKH
ZHLJKWRIUDZVLON 

$PLQRDFLGFRPSRVLWLRQLQVHULFLQDQGILEURLQ

6HULFLQ RI PXOEHUU\ ZLOG VLONZRUP %RPE\[ PRUL PDQGDULQD VHHPV WR FRQWDLQ WKH
VDPH NLQG RI DPLQR DFLGV DV WKH GRPHVWLFDWHG VLONZRUP % PRUL +RZHYHU WKH ZLOG
VLONZRUP VHULFLQ FRQWDLQHG VHULQH SUROLQH PHWKRLQLQH JOXFRVDPLQH JDODFWRVDPLQH DQG
KLVWLGLQHLQORZHUDPRXQWDQGWKURHRQLQHJOXWDPLFDFLGF\VWLQHDQGSKHQ\ODPLQHLQKLJKHU
DPRXQW7KHFRQWHQWRIWKUHRQLQHJDODFWRVDPLQHDQGJOXFRVDPLQHZHUHVLJQLILFDQWO\KLJKHU
LQWKHLQQHUOD\HURIFRFRRQVWKDQLQWKHRXWHUOD\HU)XUWKHUPRUHWKHVHULFLQH[WUDFWHGIURP
WKH IORVV VKRZHG KLJK FRQWHQWV RI VHULQH JO\FLQH YDOLQH DQG W\URVLQH EXW ORZ FRQWHQWV LQ
WKUHRQLQH DVSDUWLF DFLG DODQLQH F\VWLQH OHXFLQH JOXFRVDPLQH JDODFWRVDPLQH O\VLQH DQG
KLVWLGLQHDVFRPSDUHGZLWKWKHVHULFLQRIFRFRRQOD\HU 7DEOH 

7DEOH$PLQRDFLGFRPSRVLWLRQRIVHULFLQREWDLQHGIURPFRFRRQOD\HUDQGIORVVRIWKH
PXOEHUU\ZLOGVLONZRUP

&RFRRQOD\HU
$PLQRDFLG ,QQHU 2XWHU :KROH )ORVV
$VSHUWLFDFLG    
7KUHRQLQH    
6HULQH    
*OXWDPLFDFLG    
3UROLQH    
*O\FLQH    
$ODQLQH    
&\VWLQH    WUDFH
9DOLQH    
0HWKLRQLQH    
,VROHXFLQH    
/HXFLQH    
7U\URVLQH    
3KHQ\ODPLQH    
/\VLQH    
+LVWLGLQH    
$UJLQLQH    




ϰϭϵ

 
7KH ZLOG VLONZRUP VHULFLQ FRQWDLQHG PRUH DPLQR DFLGV ZLWK QRQSRODU VLGH FKDLQ DQG
OHVVDPLQRDFLGZLWKSRODUVLGHFKDLQWKDQWKHGRPHVWLFDWHGVLONZRUPVHULFLQ7KHFRHIILFLHQW
RI SDWWHUQVLPLODULW\ LQ DPLQR DFLG FRPSRVLWLRQ ZDV KLJK EHWZHHQ WKH VHULFLQ RI ZLOG
VLONZRUPDQGGRPHVWLFDWHGVLONZRUPVZKLOHVHULFLQRIWKHZLOGVLONZRUPVXFKDV$QWKHUDHD
RU3K\ORVDPLDVKRZHGVLJQLILFDQWO\ORZVLPLODULW\ 7DEOH 7KHUHVXOWVVKRZWKDWWKHDPLQR
DFLG FRPSRVLWLRQ RI VHULFLQ H[WUDFWHG IURP WKH FRFRRQ LV VSHFLHV VSHFLILF )LEURLQ KDV KLJK
SURSRUWLRQV RI DODQLQH JO\FLQH DQG VHULQH $ VPDOO DPRXQW RI F\VWLQH UHVLGXHV JLYH D YHU\
VPDOODPRXQW RIVXOSKDULQ WKHILEUH )LEURLQ FRQWDLQV RQO\ DVPDOODPRXQWRIDPLQRDFLGV
ZKLFK KDYH DFLG VLGH FKDLQV 7DEOH   7KH LVRHOHFWULF SRLQW RI VLON ILEUH LV DURXQG S+ 
7KHUHLVORZSURSRUWLRQRIDPLQRDFLGUHVLGXHVZLWKODUJHFKDLQVLQVLON

7DEOH3DWWHUQVLPLODULW\FRHIILFLHQWRIDPLQRDFLGFRPSRVLWLRQRIWKHVHULFLQIURP
PXOEHUU\ZLOGVLONZRUP $ DQGRWKHUVLONZRUPV % 
3DWWHUQ
6LONZRUP VLPLODULW\
 FRHIILFLHQW
%RPE\[PRULPDQGDULQD 
%RPE\[PRUL 
$QWKHUHD\DPDPDL 
$QWKHUDHDSHUQ\L 
$SDSKLDP\OLWWD 
$DVVDPHQVLV 
3KLORVRPLDF\QWKLDULFLQL 


3DWWHUQVLPLODULW\FRHIILFLHQW 6 $%  

7DEOH$PLQRDFLGFRPSRVLWLRQRIVLONILEURLQV UHVLGXHVUHVLGXHV 
$PLQRDFLGV %PRULILEUH
*O\FLQH 
$ODQLQH 
9DOLQH 
/HXFLQH 
,VROHXFLQH 
6HULQH 
7KUHRQLQH 
$VSDUWLFDFLG 
*OXWDPLFDFLG 
/\VLQH 
$UJLQLQH 
+LVWLGLQH 

ϰϮϬ

 7\URVLQH 
3KHQ\ODODQLQH 
3UROLQH 
7U\SWRSKDQ 
0HWKLRQLQH 
&\VWHLQH  
 *O\!$OD

6'63RO\DFU\ODPLGHJHOHOHFWURSKRUHVLVRI6HULFLQDQG)LEURLQSURWHLQ

$ SURWHLQ ZLWK D ORZ PROHFXODU PDVV RI  IURP WKH FRFRRQ VKHOO RI VLONZRUP
%RPE\[PRULZDVSXULILHG7ZRGLPHQVLRQDOSRO\DFU\ODPLGHJHOHOHFWURSKRUHVLV '3$*( 
UHVROYHG WKLV SURWHLQ LQWR D VLQJOH VSRW ZLWK S,  DQG 0U  $PLQR DFLG VHTXHQFH
DQDO\VLV UHYHDOHG WKDW WKLV SURWHLQ FRQVLVWV RI  DPLQR DFLGV VL[ RI WKHVH EHLQJ F\VWLQH
UHVLGXHV DQG LV KLJKO\ KRPRORJRXV WR ERYLQH SDQFUHDWLF WU\SVLQ LQKLELWRU W\SH 7KH UHVXOW
LQGLFDWHGDVLJQLILFDQWGLIIHUHQFHLQWKHSURWHLQFRPSRVLWLRQRIWKHVDPHSDUWRIPLGGOHVLON
JODQG 06* FHOOVDPRQJWKHVHFRQGGD\WKHIRXUWKGD\DQGWKHPDWXUHVLONZRUPRIWKHILIWK
LQVWDUODUYDHRIVLONZRUP(LJKWVSHFLDOSURWHLQVSRWVDUHH[SUHVVHGLQDQWHULRUSDUWRI06*
FHOOVLQWKHVHFRQGGD\VL[WHHQLQWKHIRXUWKGD\RIILIWKLQVWDUDQGWZHQW\IRXULQWKHPDWXUH
VLONZRUP

1LQHVSHFLDOSURWHLQVSRWVDUHGHWHFWHGLQWKHPLGGOHSDUWRI06*FHOOVLQWKHVHFRQG
GD\WKLUW\WKUHHLQWKHIRXUWKGD\RIILIWKLQVWDUDQGWKLUW\IRXULQWKHPDWXUHVLONZRUP7HQ
VSHFLDOSURWHLQVSRWVDUHIRXQGLQSRVWHULRUSDUWRI06*FHOOLQWKHVHFRQGGD\VHYHQLQWKH
IRXUWK GD\ RI ILIWK LQVWDU DQG WZHQW\ILYH LQ WKH PDWXUH VLONZRUP '3$*( SDWWHUQV RI
SURWHLQ IURP SRVWHULRU VLON JODQG RI WK GD\ VLONZRUP LQ WK LQVWDU RI GLIIHUHQW EUHHGV RI %
0RUL ZHUH DQDO\]HG 3URWHLQ IRUPV RI SRVWHULRU VLON JODQG DUH DSSDUHQWO\ GLIIHUHQW IRU
GLIIHUHQW EUHHGV DQG GLIIHUHQW SURWHLQ VSRWV DUH IRXQG ZKHQ WKH\ FRPSDUHG WR PLGGOH VLON
JODQG RI GLIIHUHQW EUHHG LPSO\LQJ WKDW WKH WUDQVFULSWLRQ WUDQVODWLRQ RI ILEURLQ JHQH PD\
LQYROYHDFRPSOH[UHJXODWLRQV\VWHPZLWKJUHDWGHDORIUHJXODWLRQSRLQWV7KHTXDOLWDWLYHDQG
TXDQWLWDWLYHGLIIHUHQFHV LQ SURWHLQV H[SUHVVHGLQ WKH PLGGOH VLON JODQGV RI PDOH DQG IHPDOH
VLONZRUP ODUYDH WKDW GLIIHUHQWLDO VLON FRORXU DUH LQYHVWLJDWHG E\ KLJK UHVROXWLRQ
WZRGLPHQVLRQDOSRO\DFU\ODPLGHJHOHOHFWURSKRUHVLV '3$*( 7KH\UHSRUWHGWKDWWKHUHDUH
QRGLVWLQFWGLIIHUHQWLDOSURWHLQVEHWZHHQWKHVLONJODQGWLVVXHRIIHPDOHDQGPDOHODUYDHZLWKLQ
WKHVDPHYDULHW\RIVH[OLPLWHGFKDUDFWHU

,VRODWLRQRIWKHVPDOOHVWFRPSRQHQWRIVLONRXWRIWKHVHULHVRISRO\PHUVRIWKHVPDOOHVW
FRPSRQHQWZDVGHWHFWHGE\SRO\DFU\ODPLGHJHOHOHFWURSKRUHVLVFRXOGEHFRQYHUWHGLQWRWKH
VPDOOHVW FRPSRQHQW E\ UHGXFWLRQ DQG DPLQRHWK\ODWLRQ )LEURLQ DQG VHULFLQ IUDFWLRQ ZHUH
VHSDUDWHG E\ SUHFLSLWDWLRQ RI VHULFLQ DW S+  2Q WKH JHO HOHFWURSKRUHVLV VHULFLQ VKRZHG
GLVWLQFWEDQGEXWILEURLQGLGQRW7KHFRPSRQHQWRIWKHILEURLQDQGVHULFLQDUHIUDFWLRQDWHGE\
JHOILOWUDWLRQRQVHSKDURVH%7KHVPDOOHVWFRPSRQHQWLQWKHVHULFLQIUDFWLRQLVSXULILHGE\
UHFKURPDWRJUDSK\ DQG VKRZHG D VLQJOH EDQG RQ JHO HOHFWURSKRUHVLV 6LON SURWHLQ VROXWLRQ
SUHSDUHGE\VROXELOL]DWLRQRIDZKROHFRFRRQZLWK('&X 0(WK\OHQHGLDPLQH0
FXSULF K\GUR[LGH  VROXWLRQ VKRZHG GLVWLQFW EDQGV RQ SRO\DFU\ODPLGH JHO HOHFWURSKRUHVLV LQ
WKHSUHVHQFHDQGDEVHQFHRI6'6DQGWKDWWKHUHH[LVWVDVHULHVRISRO\PHUV

7KHVH SRO\PHUV DUH UHGXFHG E\ PHUFDSWRHWKDQRO WR WKH VPDOOHVW FRPSRQHQW RI VLON
SURWHLQZKLFKKDGDQDSSDUHQWPROZWRI7KXVILEURLQDQGVHULFLQFDQEHVHSDUDWHGE\

ϰϮϭ

SUHFLSLWDWLRQ WKHQ ERWK WKH IUDFWLRQ RI VLON FDQ EH H[DPLQHG E\ SRO\DFU\ODPLGH JHO
HOHFWURSKRUHVLV7KHDPLQRDFLGFRPSRVLWLRQVRIWZRIUDFWLRQVDUHVKRZQLQ7DEOH

7DEOH$PLQRDFLGFRPSRVLWLRQRIVXSHUQDWDQWIUDFWLRQWKHSUHFLSLWDWHIUDFWLRQDQG
WKHVPDOOHVWFRPSRQHQWRIVLONSURWHLQ
6XSHUQDWDQW 3UHFLSLWDWH 6PDOOHVW
3URWHLQV )UDFWLRQ)LEURLQ )UDFWLRQ6HULFLQ FRPSRQHQW
$VSDUWLFDFLG   
7KUHRQLQH   
6HULQH   
*OXWDPLFDFLG   
3UROLQH   
*O\FLQH   
$ODQLQH   
9DOLQH   
0HWKLRQLQH   
,VROHXFLQH   
/HXFLQH   
7U\URVLQH   
3KHQ\ODPLQH   
/\VLQH   
+LVWLGLQH   
$UJLQLQH   
$PLQR(WK\OF\VWHLQH  7UDFH 
&RQWHQWVDUHH[SUHVVHGDVPRO

7KH VXSHUQDWDQW IUDFWLRQ NQRZQ DV ILEURLQ LV SDUWLFXODUO\ ULFK LQ JO\FLQH DQG DODQLQH
ZKLFK WRJHWKHU DFFRXQWHG IRU PRO &RQYHUVHO\ WKH SUHFLSLWDWH IUDFWLRQ LV NQRZQ DV
VHULFLQZKLFKZDVULFKLQJO\FLQHVHULQHDODQLQHDQGDVSHUWLFDFLGWKHFRPELQHGFRQWHQWVRI
ZKLFK DPRXQWHG WR PRO 7KH UHVXOWV RI HOHFWURSKRUHVLV VXJJHVW WKDW FRPSRQHQWV RI
VHULFLQKDYHGHILQHPROHFXODUZHLJKWVEXWWKRVHRIILEURLQGRQRW

$SSOLFDWLRQVRI6HULFLQDQGILEURLQSURWHLQ

6LONZRUPLVEHLQJXVHGDVELRIDFWRU\IRUWKHSURGXFWLRQRIXVHIXOSURWHLQ6LONSURWHLQV
DUH QDWXUDO SRO\PHUV DQG DUH ELRGHJUDGDEOH ZLWK UHDFWLYH IXQFWLRQDO JURXSV WKDW RSHQ XS
SRVVLELOLW\WREHFURVVOLQNHGZLWKRWKHUSRO\PHUVWREHXVHGLQFRQWUROOHGGHOLYHU\/LNHRWKHU
FRPPRQELRPHGLFDOWH[WLOHVVXFKDVSRO\HVWHUVLONFRQWDLQVYDULRXVSRODUIXQFWLRQDOJURXSV
WKDWPLJKWHQKDQFHDQWLELRWLFDEVRUSWLRQ

%LRGHJUDGDEOH PDWHULDOV (QYLURQPHQW  IULHQGO\ ELRGHJUDGDEOH SRO\PHUV FDQ EH
SURGXFHGE\EOHQGLQJVHULFLQZLWKRWKHUUHVLQV

7KH 3RO\XUHWKDQH IRDPV LQFRUSRUDWLQJ VHULFLQ DUH VDLG WR KDYH H[FHOOHQW PRLVWXUH
DEVRUELQJ DQG GHVRUELQJ SURSHUWLHV 3RO\PHU ILOPV IRDPV PROGLQJ UHVLQV DQG ILEUHV
FRQWDLQLQJ VHULFLQ  ZZ  FDQ EH SURGXFHE\ UHDFWLQJ D FRPSRVLWLRQ FRPSULVLQJ D
SRO\RO WRO\OHQH GL LVRF\DQHW GLEXW\OWLQ GLODXUDWH FDWDO\VW  DQG
WULFKORURPRQRIOXRURPHWKDQH D EORZLQJ DJHQW  LQ WKH SUHVHQFH RI VHULFLQ 7KH PRLVWXUH

ϰϮϮ

DEVRUSWLRQGHVRUSWLRQ UDWH RI WKH VHULFLQ FRQWDLQLQJ SRO\XUHWKDQH IRUP LV WZRWR ILYH IROG
JUDWHUWKDQWKDW RIFRQWURO2WKHUSURFHGXUHVKDYHDOVR EHHQ UHSRUWHGIRU SURGXFLQJ VHULFLQ
FRQWDLQLQJSRO\XUHWKDQHZLWKH[FHOOHQWPHFKDQLFDODQGWKHUPDOSURSHUWLHV

0HPEUDQHPDWHULDOV

0HPEUDQHEDVHGVHSDUDWLRQV HJUHYHUVHRVPRVLVGLDO\VLVXOWUDILOWUDWLRQDQGPLFUR
ILOWUDWLRQ  DUH XVHG LQ SURFHVV VXFK DV GHVDOLQDWLRQ RI ZDWHU SURGXFWLRQ RI H[WUHPHO\ SXUH
ZDWHUWKHELRSURFHVVLQJLQGXVWU\DQGVRPHFKHPLFDOSURFHVVHV3XUHVHULFLQQRWHDVLO\PDGH
LQWR PHPEUDQHV EXW PHPEUDQHV RI VHULFLQ FURVVOLQNHG EOHQGHG RU FRSRO\PHUL]HG ZLWK
RWKHUVXEVWDQFHDUHPDGHUHDGLO\EHFDXVHVHULFLQFRQWDLQVODUJHDPRXQWRIDPLQRDFLGZLWK
QHXWUDOSRODUIXQFWLRQDOJURXSV6HULFLQDQGILEURLQFDQEHXVHGWRPDNHPHPEUDQHVIRUXVHLQ
VHSDUDWLRQSURFHVVHV7KHLQVROXELOL]HGVLONILEURLQPHPEUDQHFRXOGEHXVHGWRVHSDUDWHWKH
PL[WXUHRIZDWHUDQGDOFRKRO$FURVVOLQNHGWKLQILOPPDGHRIVHULFLQIRUXVHDVDVHSDUDWLQJ
PHPEUDQH IRU ZDWHU DQG HWKDQRO 6HULFLQ FRQWDLQLQJ PHPEUDQHV DUH TXLWH K\GURSKLOLF
$FU\ORQLWULOHXVHGLQPDNLQJFHUWDLQV\QWKHWLFSRO\PHUVFDQEHFRSRO\PHUL]HGZLWKVHULFLQWR
SUHSDUHDSURWHLQFRQWDLQLQJV\QWKHWLFSRO\PHUILOPIRUVHSDUDWLQJZDWHUIURPRUJDQLFV

)XQFWLRQDOELRPDWHULDOV

6HULFLQ ILOP ORFDWHG RQ OD\ RI OLTXLG FU\VWDO FDQ XQLIRUPO\ RULHQW WKH OLTXLG FU\VWDO
PROHFXOHV WR SURYLGH GLVWRUWLRQIUHH KLJK TXDOLW\ FU\VWDO GLVSOD\V 6HULFLQ FRDWHG ILOP LV
XVHGRQWKHVXUIDFHRIUHIULJHUDWLRQHTXLSPHQWEHFDXVHRILWV DQWLIURVWLQJDFWLRQ8VHRIWKH
FRDWHG VHULFLQ ILOP LV DQ HIIHFWLYH DQWLIURVWLQJ PHWKRG WKDW FDQ EH ZLGHO\ DSSOLHG WR
UHIULJHUDWRUVGHHSIUHH]HUVDQGUHIULJHUDWHGWUXFNVDQGVKLSV0RUHRYHUXVHRIWKHFRDWHGILOP
RQ URDGV DQG URRI FDQ SUHYHQW IURVW GDPDJH 6HULFLQ SURWHLQ FDQ EH FRDWHG RQ VXUIDFHV RI
YDULRXVGXUDEOHPDWHULDOVWRHQKDQFHIXQFWLRQDOLW\

6HULFLQFDQEHXVHGLQSUHSDUDWLRQRIDUWSLJPHQWVDQGIRUVXUIDFHSURWHFWLRQRIDUWLFOHV
7KHPDWHULDOFRDWHGWKHVHULFLQKDYHH[FHOOHQWZHDWKHUDELOLW\JRRGSHUPHDELOLW\DQGGRQRW
ZDUS RQ GU\LQJ 6HULFLQ EOHQGV ZLWK ZDWHU VROXEOH SRO\PHUV HVSHFLDOO\ ZLWK SRO\YLQ\O
DOFRKRO 39$  $ EOHQGHG K\GURJHO PDGH RI VHULFLQ DQG ILEURLQ DQG 39$ LV VDLG WR KDYH
H[FHOOHQW PRLVWXUH DEVRUELQJ DQG GHVRUELQJ SURSHUWLHV DQG HODVWLFLW\ 7KH K\GURJHO FDQ EH
XVHG DV D VRLO FRQGLWLRQHU DQG LQ PHGLFDO PDWHULDOV DQG ZRXQG GUHVVLQJ $ FURVVOLQNHG
VHULFLQ ILOPIRU HQ]\PHLPPRELOL]DWLRQ ZLWKJOXWDUDOGHK\GHDVWKHFURVVOLQNLQJDJHQWZDV
SUHSDUHG 7KH KHDW VWDELOLW\ WKH HOHFWURRVPRVLV UHVLVWDQFH DQG WKH VWDELOLW\ RI WKH
LPPRELOL]HG-JOXFRVLGDVHRQWKHFURVVOLQNHGVHULFLQILOPDUHKLJKHUWKDQWKHIUHHHQ]\PH

0HGLFDOELRPDWHULDOV

6LONZRUP VLON ILEUHV KDYH EHHQ WKH SULPDU\ VLON OLNH PDWHULDO XVHG LQ ELRPHGLFDO
DSSOLFDWLRQV SDUWLFXODUO\ DV VXWXUHV 'XULQJ GHFDGHV RI XVH VLON ILEUHV KDYH SURYHQ WR EH
HIIHFWLYH LQ PDQ\ FOLQLFDO DSSOLFDWLRQV $W WKH VDPH WLPH VRPH ELRORJLFDO UHVSRQVHV WR WKH
SURWHLQ KDYH UDLVHG TXHVWLRQV DERXW ELRFRPSDWLELOLW\ $ VLON ILEURLQ EDVHG ZRXQG GUHVVLQJ
WKDW FRXOG DFFHOHUDWH KHDOLQJ DQG FRXOG EH SHHOHG RII ZLWKRXW GDPDJLQJ WKH QHZO\ IRUPHG
VNLQ 7KH QRQFU\VWDOOLQH ILEURLQ ILOP RI WKH ZRXQG GUHVVLQJ KDG D ZDWHUFRQWHQW RI 
DQGDWKLFNQHVVRIȝP6XEVHTXHQWO\WKHZRXQGGUHVVLQJZDVPDGHZLWKDPL[WXUH
RIERWKILEURLQDQGVHULFLQ


ϰϮϯ

 $ PHPEUDQH FRPSRVHG RI VHULFLQ DQG ILEURLQ LV DQ HIIHFWLYH VXEVWUDWH IRU WKH
SUROLIHUDWLRQ RI DGKHUHQW DQLPDO FHOOV DQG FDQ EH XVHG DV D VXEVWLWXWH IRU FROODJHQ 7KH
DWWDFKPHQWDQGJURZWKRIDQLPDOFHOOVRQILOPVPDGHRIVHULFLQDQGILEURLQZDVQRWLFHG&HOO
DWWDFKPHQWDQGJURZWKZHUHGHSHQGHQWRQPDLQWDLQLQJDPLQLPXPRIDURXQGVHULFLQLQ
WKHFRPSRVLWHPHPEUDQH)LOPPDGHRIVHULFLQDQGILEURLQKDVH[FHOOHQWR[\JHQSHUPHDELOLW\
DQGLVVLPLODUWRKXPDQFRUQHDLQLWV IXQFWLRQDOSURSHUWLHV,W KRSHGWKDWWKHVHULFLQILEURLQ
EOHQGHGILOPFRXOGEHXVHGWRIRUPDUWLFOHFRUQHDV

$ QRYHO PXFRDGKHVLYH SRO\PHU KDV EHHQ SUHSDUHG E\ WHPSODWH SRO\PHUL]DWLRQ RI
DFU\OLFDFLGLQWKHSUHVHQFHRIVLONVHULFLQ6LONSURWHLQFDQEHPDGHLQWRDELRPDWHULDOZLWK
DQWLFRDJXODQWSURSHUWLHVE\DVXOIRQDWLRQWUHDWPHQWRIVHULFLQDQGILEURLQ7KHILUVWHYLGHQFH
RI DQWLR[LGDQW DFWLRQ RI WKH VLON SURWHLQ E\ VKRZLQJ WKDW VHULFLQ VXSSUHVVHG LQ YLWUR OLSLG
SHUR[LGDWLRQ )XUWKHUPRUH VHULFLQ DOVR IRXQG WR LQKLELW W\URVLQDVH DFWLYLW\ 7KHVH UHVXOWV
VXJJHVWHG WKDW VHULFLQ LV WKH YDOXDEOH QDWXUDO LQJUHGLHQW IRU IRRG DQG FRVPHWLFV 7KH
ELRSRO\PHUVHULFLQKDVDVWURQJDIILQLW\WRNHUDWLQ

([FHVVLYHWUDQVHSLGHUPDOZDWHUORVV 7(:/ LVRQHRIWKHFDXVHVRIGU\VNLQDQGVNLQ
PRLVWXUL]HUVKDYHEHHQXVHGWRRYHUFRPHLW7KHVLONVHULFLQKDVUHVHPEODQFHZLWKWKHQDWXUDO
PRLVWXUL]LQJ IDFWRU 105  6HULFLQ JHO LV SUHSDUHG E\ XVLQJ VHULFLQ VROXWLRQ ZLWK SOXURQLF
DQGFDUERSRODVDVWDELOL]HUWRSUHYHQWZDWHUORVVIURPWKHXSSHUOD\HURIWKHVNLQ,WIRUPVD
PRLVWXUL]LQJ VHPLRFFOXVLYH SURWHFWLYH DQWLZULQNOH ILOP RQ WKH VNLQ VXUIDFH LPSDUWLQJ DQ
LPPHGLDWHORQJODVWLQJVPRRWK VLON\ IHHOLQJ 7KH FRQILJXUDWLRQRI VHULFLQLV YHU\FORVHWR
WKHRQHRIKXPDQEHLQJV 7KDWLV ZK\ VHULFLQFDQ QDWXUDOO\ VDWXUDWHLQWRVNLQDQGUHYLWDOL]H
FHOOV,WLVGLVFRYHUHGWKDWVHULFLQFDQUHVWUDLQWKHIXQFWLRQVRIDFWLYHR[\JHQ PDMRUIDFWRURI
DJLQJ ZKLFKEULQJVZULQNOHVDQGGDUNVSRWV

7KHXVHRIR[\JHQSHUPHDEOHPHPEUDQHVIURPVLONILEURLQDQGVLONVHULFLQFRQWDLQLQJ
DERXWZDWHUIRUFRQWDFWOHQVDUWLILFLDOVNLQHWF7KHRWKHUXVHVRIVHULFLQLQFOXGHVDVD
VRLO FRQGLWLRQHU FRDJXODQW IRU SXULILFDWLRQ RI ZDVWH ZDWHUV K\JURVFRSLF PRLVWXUHUHOHDVLQJ
SRO\XUHWKDQHIRDPVDQGWKHLUPDQXIDFWXUHIRUIXUQLWXUHDQGLQWHULRUPDWHULDOVDVDGGLWLYHVIRU
KHDOWK IRRGV WR SUHYHQW FRORQ FDQFHUV PHGLFDO FRPSRVLWHV RI VHULFLQ DGGLWLYHV WR ULFH
FRRNLQJ IDEULFFDUH FRPSRVLWLRQV OLJKW DQG VXQVFUHHQ FRPSRVLWLRQV IRDPIRUPLQJ DHURVRO
VKDYLQJ JHOV VHULFLQFRDWHG SRZGHUV IRU FRVPHWLFV DV GHUPDWLWLV LQKLELWRU DV ZRXQG
SURWHFWLRQ ILOP QDLO FRVPHWLFV DQG FKHZLQJ JXPV )LEURLQ KDV EHHQ H[SORUHG DV D
ELRPHGLFLQHIRUYDULRXVDSSOLFDWLRQV

)LEURLQ SRZGHU ZDV SURFHVVHG LQ VXFK D ZD\ WR UHWDLQ LWV QDWXUDO RSWLFDO EHDXW\ $
XQLTXHSURSHUW\RIWKLVVLONSRZGHULVLWVDELOLW\WRKROGDQGUHOHDVHPRLVWXUHGHSHQGLQJRQ
WKHWHPSHUDWXUHDQGKXPLGLW\RIWKHVXUURXQGLQJV7KHH[WUHPHO\ILQHSRZGHU VL]H LV
SDUWLFXODUO\LGHDOIRUDSSOLFDWLRQVLQSUHVVHGSRZGHUVEOXVKHUH\HPDNHXSOLSVWLFNDQGQDLO
HQDPHO

6HULFLQDQGILEURLQKDYHEHHQUHFHQWO\H[SORUHGLQWKHILHOG RI GUXJ GHOLYHU\ V\VWHPV
7KH SURSHUWLHV DQG DSSOLFDWLRQ RI ZRXQG SURWHFWLYH PHPEUDQH PDGH E\ VLON ILEURLQ ZHUH
VWXGLHG ,W LV FRQFOXGHG WKDWWKH ILEURLQ PHPEUDQH KDV JRRGZRXQG KHDOLQJ SURSHUWLHV 7KH
ILEURLQK\GURJHOVSUHSDUHGHLWKHUE\WUHDWLQJD ZY VLONILEURLQDTXHRXVVROXWLRQDWƒ&
WHPSHUDWXUH RU E\ DGGLQJ  JO\FHURO FRXOG EH XVHG DV VFDIIROGV DEOH WR SURPRWH LQ VLWX
ERQH UHJHQHUDWLRQ 8VLQJ ILEURLQ FRQWUROOHG UHOHDVH WDEOHWV JHOV DQG PHVRVSKHUH KDYH EHHQ
SUHSDUHG7KHDSSOLFDELOLW\RIILEURLQDPDMRUVLONSURWHLQWRFRQWUROOHGUHOHDVHW\SHGRVDJH
WDEOHWVLVLQYHVWLJDWHGLQYLWURDQGLQYLYR7KHVXOIDWHGVLONILEURLQVKDYHDQWL+,9DFWLYLW\

ϰϮϰ

LQ YLWURDSSDUHQWO\ GXH WR LQWHUIHUHQFH ZLWK WKH DGVRUSWLRQ RIYLUXV SDUWLFOHV WR&'  FHOOV
DQGFRPSOHWHO\EORFNHGYLUXVELQGLQJWRWKHFHOOVDWDFRQFHQWUDWLRQRIPLFURJPPO

7KHVLONILEURLQFDQEHXVHGDVWKHVXEVWUDWXPIRUWKHFXOWXUHRIDQLPDOFHOOVLQSODFHRI
FROODJHQ 7KH UHFRYHU\ RI XUDQLXP IURP GLOXWH DTXHRXV VROXWLRQV XVLQJ VLON ILEURLQ FDQ EH
GRQH7KHDTXHRXVVROXWLRQRIILEURLQLVXVHGWRSUHSDUHDPHPEUDQHIRULPPRELOL]DWLRQRI
$VSHUJLOOXV QLJHU JOXFRVHR[LGDVH DQG 3VHXGRPRQDV IOXRUHVFHQV O\RSKLOL]HG FHOOV 7KH
ILEURLQPHPEUDQHLVXVHGWRLPPRELOL]HFRHQ]HGLQVHFWFHOOFXOWXUHDVDYDFFLQH

7KH 5HFRPELQDQW KXPDQOLNH FROODJHQ 5+/&  LV EOHQGHG ZLWK ILEURLQ WR SUHSDUH D
QRYHO ELRFRPSDWLEOH ILOP DV D VFDIIROG PDWHULDO IRU KHSDWLF WLVVXHHQJLQHHULQJ DSSOLFDWLRQV
6ROXWLRQEOHQGLQJLVXVHGWRLQFRUSRUDWH5+/& ZLWKVLONILEURLQWRHQKDQFHWKHEOHQGILOPV
ELRFRPSDWLELOLW\ DQG K\GURSKLOLFLW\ ZKLOH PDLQWDLQLQJ HODVWLFLW\ 6ROXEOH ILEURLQ HQKDQFHV
,QVXOLQVHQVLWLYLW\DQGJOXFRVHPHWDEROLVPLQ7/$GLSRVLWLHV7KHILEURLQSURWHLQLVRQH
NLQG RI ELRORJLFDO PDWHULDOV XVHG IRU DUWLILFLDO VNLQ DQG RWKHUV PHGLFDO DSSOLFDWLRQ 6LON
ILEURLQ PHPEUDQH VXSSRUWV WKH DSSOLFDWLRQ DV SKRWR VHQVRUIRU K\GURJHQ SHUR[LGH DQDO\VLV
6LON SURWHLQ VHULFLQ VXSSUHVV '0%$73$ LQGXFHG PRXVH VNLQ WXPRULJHQHVLV E\ UHGXFLQJ
R[LGDWLYHVWUHVVLQIODPPDWRU\UHVSRQVHVDQGHQGRJHQRXVWXPRUSURPRWHU71)DOSKD

3K\VLFDOPDSRI%RPE\[PRUL

$SK\VLFDOPDS RI WKH'1$ FRQWDLQLQJ WKH JHQH IRU VLON ILEURLQ ZDV GHYHORSHG IURP
GLUHFWK\EULGL]DWLRQDQDO\VLVRI UHVWULFWLRQHQGRQXFOHDVH GLJHVWV RI WRWDO %RPE\[PRUL '1$
XVLQJ ILEURLQ,P51$7KHRULHQWDWLRQRIP51$ WUDQVFULSWLRQ UHODWLYH WR WKLV PDS ZDV
GHGXFHG IURP WKH VHQVLWLYLW\ RI WKH P51$ FRGLQJ VWUDQG ZLWKLQ FHUWDLQ '1$ UHVWULFWLRQ
VHJPHQWV WR ODPEGDH[RQXFOHDVH DQG H[RQXFOHDVH ,,, 7KH PDS LQFOXGHV WKH HQWLUH JHQH
FRGLQJUHJLRQ DSSUR[LPDWHO\[ DQGODUJH'1$HOHPHQWVZKLFKIODQNWKHJHQHDWLWV
  HQG DSSUR[LPDWHO\  [  DQG   HQG DSSUR[LPDWHO\  [   7KH FRGLQJ UHJLRQ LV
UHPDUNDEO\XQLIRUPLQLWVVHQVLWLYLW\WRUHVWULFWLRQHQGRQXFOHDVHV,WLVFRPSOHWHO\GHYRLGRI
VLWHVIRUPRVWRIWKHHQ]\PHVWHVWHGLQFOXGLQJ+DH,,,WKHUHFRJQLWLRQVHTXHQFH GS**&
& RIZKLFKPLJKW EHH[SHFWHGWRRFFXUIUHTXHQWO\LQWKLVODUJH'1$EORFNRI*&
FRQWHQW 7KH ILEURLQ FRGLQJ UHJLRQ GRHV FRQWDLQ DQ HQRUPRXV QXPEHU RI VLWHV IRU HQ]\PHV
SUHGLFWHGWRKDYHDFWLYLW\IURP NQRZQILEURLQ P51$VHTXHQFHV7KHVH UHVXOWVVXJJHVW WKDW
WKHILEURLQJHQHFRUHLVDODUJHKRPRJHQHRXVO\UHSHWLWLYHEORFNRI'1$ZLWKOLWWOHHYLGHQFH
IRU VHTXHQFH GLYHUJHQFH RU WKH SUHVHQFH RI TXDOLWDWLYHO\ GLIIHUHQW VHTXHQFHV ZKLFK PLJKW
FUHDWHRWKHUUHVWULFWLRQVHQVLWLYLWLHV7KHPDSDOORZVDFRPSDULVRQWREHPDGHRIWKHILEURLQ
JHQHFRQWH[WLQ'1$IURPWLVVXHVHLWKHUDFWLYHRULQDFWLYHLQILEURLQV\QWKHVLV

5HJXODWLRQRIVLONHQFRGLQJJHQHV

$VVKRZQLQ)LJXUHWKHVLONJODQGWKHVSHFLDOL]HGVDOLYDU\JODQGVWKDWSURGXFHVLON
LV FRPSRVHG RI WZR VHFUHWRU\ SDUWV WKH SRVWHULRU VLON JODQG 36*  ZKHUH ILEURLQ LV
V\QWKHVL]HG DQG WKH PLGGOH VLON JODQG 06* WKDW SURGXFHV WKH VHULFLQV )LEURLQ LV D WKUHH
VXEXQLW FRPSOH[ FRQVWLWXWHG E\ WKH KHDY\ FKDLQ +)LE  WKH OLJKW FKDLQ /)LE  DQG
ILEURKH[DPHULQ IRUPHUO\ UHIHUUHG WR DV 3  +)LE LV D ODUJH SURWHLQ  DPLQR DFLG
UHVLGXHV ZKLFKDFFRXQWVIRURIWKHVLONPDVV/)LELVDN'DSRO\SHSWLGHOLQNHGWR
+)LEE\DGLVXOILGHERQG)LEURKH[DPHULQDN'D SHSWLGH LQWHUDFWV ZLWK /)LE+)LE
FRPSOH[ WKURXJK K\GURSKRELF LQWHUDFWLRQV %RWK VPDOO SHSWLGHV VHUYH DV PROHFXODU
FKDSHURQHVGXULQJWKHLQWUDFHOOXODUWUDQVSRUWDQGVHFUHWLRQRIWKH+FKDLQDQGDUHSDUWRIWKH
VLONWKUHDG6HULFLQVDUHDIDPLO\RI SHSWLGHVHQFRGHGE\WZRJHQHV 6HUDQG6HUZKLFK

ϰϮϱ

JOXHWKHVLONWKUHDGV3UHYLRXVVWXGLHVRQWKHUHJXODWLRQRIWKHVLONHQFRGLQJJHQHVVXJJHVWWKH
H[LVWHQFHRIWZRLQWULFDWHOHYHOVRIWUDQVFULSWLRQDOUHJXODWLRQ

2QH OLHV LQ WKH H[LVWHQFH RI VLON JODQGVSHFLILF DQG WHUULWRU\VSHFLILF WUDQVDFWLYDWRUV
7KHIDFWRU6*)DIRUNKHDGIDPLO\SURWHLQEHORQJVWRWKHILUVWFDWHJRU\DQGLVUHVSRQVLEOH
IRUWKHDFWLYDWLRQRI6HULQ06*FHOOVDQGRIIK[LQ36*FHOOV7KLVIDFWRUSUHVHQWLQERWK
WHUULWRULHVRIWKHVLONJODQGOLNHO\LQWHUDFWVZLWKVSHFLILFSDUWQHUVDEOHWRGLVFULPLQDWHEHWZHHQ
WKHSRVWHULRUDQGWKHPHGLDQVXESDUWV

7KHVHFRQGFRQFHUQVFKURPDWLQDFFHVVLELOLW\7KHRUJDQL]DWLRQRIFKURPDWLQDURXQGWKH
IK[SURPRWHULVFRUUHODWHGWRWKHIXQFWLRQLQJRIWKHJHQHDQGWKXVLVVXSSRVHGWRFRQWUROWKH
DFFHVVRIWUDQVDFWLYDWRUVWRWKHLUWDUJHW'1$,WZDVVKRZQWKDWWKHFKURPDWLQVWUXFWXUHRIIK[
LQ WKH 36* ZKHUH WKH JHQH LV H[SUHVVHG  H[KLELWV WZR '1DVH K\SHUVHQVLWLYH VLWHV DQG D
01DVH DFFHVVLEOH UHJLRQ WKDW DUH QRW SUHVHQW LQ WKH 06* 7KLV LQGLFDWHV WKDW DQ RSHQ
FKURPDWLQFRQILJXUDWLRQFKDUDFWHUL]HVWKHJHQHLQWKH36*ZKHUHDVLWUHPDLQVQRQDFFHVVLEOH
LQWKH06*7KLVZRXOGVXJJHVWWKDWGXULQJHDUO\PRUSKRJHQHVLVRIWKHVLONJODQGLQWKH
HPEU\RDPHFKDQLVPGLVFULPLQDWHVWKHIK[JHQHLQWKHWZRSURVSHFWLYHVXESDUWVRIWKHJODQG
7KHLQYROYHPHQWRIWKHVDPH6*)IRUNKHDGIDFWRUDWHDUO\PRUSKRJHQHVLVPD\VXJJHVWWKDW
WKH VDPH IDFWRUV WKDW UHJXODWH WUDQVFULSWLRQ LQ GLIIHUHQWLDWHG FHOOV DUH DOVR LQYROYHG LQ WKLV
GHWHUPLQDWLRQSURFHVV

8VLQJWUDQVJHQHVLVQRZPDNHVLWSRVVLEOHWRDGGUHVVQHZTXHVWLRQVRQWKLVV\VWHP7KH
VWXG\RI6*)H[SUHVVLRQGXULQJVLONJODQGHPEU\RQLFGHYHORSPHQWZLOODOORZHOXFLGDWLRQRI
WKHUROHRIWKLVIDFWRULQPRUSKRJHQHVLVSULRUWRDQDO\VLQJWKHSKHQRW\SHVLQGXFHGE\RYHU
H[SUHVVLRQ RU LQKLELWLRQ YLD 51$ LQWHUIHUHQFH  RU E\ GRPLQDQW QHJDWLYH YHUVLRQV RI WKH
IDFWRU7UDQVJHQHVLVZRXOGDOVRDOORZWKHORFDOL]DWLRQRIWKH'1$VHTXHQFHVLQYROYHGLQWKH
UHFRJQLWLRQRIWKHIK[JHQHWREHH[SUHVVHGLQWKHIXWXUH36*FHOOVE\VWXG\LQJPXWDWHGIK[
GHULYHGWUDQVJHQHVDQGORRNLQJDWERWKWKHLU'1$WRSRORJ\DQGWKHLUWUDQVFULSWLRQDELOLWLHV,W
VKRXOG WKXV EH SRVVLEOH WR GHOLQHDWH ZKLFK VHTXHQFHV DUH UHTXLUHG IRU GHILQLQJ WKH WLVVXH
VSHFLILFLW\RIH[SUHVVLRQLQWKHVLONJODQG

ϰϮϲ

 

)LJXUH  )XQFWLRQDO RUJDQL]DWLRQ RI WKH VLON JODQG 7KH  FHOOV RI WKH SRVWHULRU VLON
JODQGV\QWKHVL]HWKHWKUHHVXEXQLWVRIWKHILEURLQFRPSOH[ZKLFKLVVHFUHWHGLQWRWKHOXPHQ
DQGDFFXPXODWHVLQWKHPLGGOHVLONJODQGZKHUHLWLVFRYHUHGE\VXFFHVVLYHOD\HUVRIVHULFLQV
7KHYDULRXVVHULFLQVSURGXFHGLQGLIIHUHQWVXESDUWVRIWKHPLGGOHVLONJODQGDUHHQFRGHGE\
WKH6HUDQG6HUJHQHVDFWLYHLQDQGFHOOVUHVSHFWLYHO\


7UDQVJHQLF6LONZRUP

7KHSURGXFWLRQVRIXVHIXOPDWHULDOVLQWKHWUDQVJHQLFRUJDQLVPVKDYHEHHQGHYHORSHGLQ
SODQWVDQGPDPPDOV,QLQVHFWVWKHPHWKRGKDVEHHQUHTXHVWHGDOWKRXJKWKHYLUXVV\VWHPVIRU
WKHSURGXFWLRQRIUHFRPELQDQWSURWHLQVKDYHEHHQHVWDEOLVKHG6LQFHWKHVLONZRUPSRVVHVVHV
WKHYHU\KLJKDELOLW\WRV\QWKHVL]HDODUJHDPRXQWRIVLONSURWHLQVLWKDVEHHQH[SHFWHGWKDW
YHU\HIILFLHQWV\VWHPVIRUWKHSURGXFWLRQRIXVHIXOPDWHULDOVFDQEHHVWDEOLVKHG,QDGGLWLRQ
WKHNQRZOHGJHDERXWWKHVLONZRUPVFLHQFHKDVEHHQH[WHQVLYHO\DFFXPXODWHGLQ-DSDQGXULQJ
WKHVH  \HDUV DQG WKH WHFKQRORJ\ KDQGOLQJ WKH VLONZRUP KDV EHHQ GHYHORSHG %DVHG RQ
WKHVH VFLHQWLILFIXQGDPHQWDOVWKH WHFKQRORJ\ XVLQJ WKH WUDQVJHQLF VLONZRUP ZDV WKRXJKW WR
KDYHYHU\KLJKSRWHQWLDODQGLWZLOORSHQLPSRUWDQWQHZILHOGRIDJURELRORJLFDOVFLHQFHV

7KHUHFHQWVXFFHVVRIWUDQVJHQHVLVRIWKHVLONZRUP%RPE\[PRULRSHQVQHZSURVSHFWV
RQ WKLV LQVHFW VSHFLHV H[SORLWHG ERWK DV D SRZHUIXO ELRORJLFDO PRGHO V\VWHP DQG DV D VLON
SURGXFHU LQ LQGXVWU\ ,Q EDVLF UHVHDUFK WKH H[DPSOHV RI 'URVRSKLOD PHODQRJDVWHU DQG WKH
PRXVH VKRZ KRZ PDVWHUHG WUDQVJHQHVLV FDQ EH H[WUHPHO\ KHOSIXO LQ XQGHUVWDQGLQJ EDVLF
ELRORJLFDO IXQFWLRQV UHODWHG WR JHQH H[SUHVVLRQ DQG UHJXODWLRQ 6LPLODU DFKLHYHPHQWV LQ WKH

ϰϮϳ

VLONZRUPFDQQRZEHIRUHVHHQWRGHFLSKHUEDVLFSK\VLRORJLFDOIXQFWLRQVRIWKHLQVHFWWKDWLQ
WXUQPLJKWVXVWDLQIXUWKHUELRWHFKQRORJLFDODQGVHULFXOWXUDODSSOLFDWLRQV

7KH LQWHUHVW LQ WUDQVIRUPLQJ WKH VLONZRUPURVHPRUH WKDQ WHQ \HDUV DJR EXW UHDFKLQJ
WKHREMHFWLYHWXUQHGRXWWREHDGLIILFXOWWDVN5DQGRPLQWHJUDWLRQRI'1$IROORZLQJLQMHFWLRQ
RIVLONZRUPHJJVZDVDWWHPSWHG\HDUVDJRLQWKHOLQHRISRVLWLYHUHVXOWVREWDLQHGLQPRXVH
7KLVSURFHGXUHZDVIRXQGQRQRSHUDWLYHLQVSLWHRIWKHSRVVLELOLW\WRLQWHJUDWHIRUHLJQ'1$
ZLWKRXW WKH KHOS RI DQ\ YHFWRU 7KLV OHG WR DQ LQWHQVLYH EXW VWLOO XQVXFFHVVIXO VHDUFK IRU
DGDSWHG YHFWRUV VXFK DV HQGRJHQRXV WUDQVSRVRQV SVHXGRW\SHG PDPPDOLDQ UHWURYLUXVHV RU
PRGLILHGGHQVRYLUXVHV$WWKHVDPHWLPH%PRULJHQHVZHUHH[SUHVVHGLQLQVHFWFHOOOLQHVLQ
VRPDWLF FHOOV RI HPEU\RV LQ ELROLVWLFDWHG VLON JODQGV DQG LQ WUDQVJHQLF 'PHODQRJDVWHU
)LQDOO\WKHWUDQVSRVRQSLJJ\%DFZKLFKKDGEHHQLVRODWHGIURPWKHPRWK7ULFKRSOXVLDQLZDV
IRXQGHIILFLHQWIRUPDNLQJWUDQVJHQLF%PRULDVZHOODVRWKHUVSHFLHV VHHEHORZ RSHQLQJWKH
ZD\WRWUDQVJHQHVLVLQDZLGHVSHFWUXPRILQVHFWVDQGSRVVLEO\RWKHU$UWKURSRGV

D7KHSLJJ\%DFWUDQVSRVRQ

SLJJ\%DFZDVILUVWGLVFRYHUHGDVWKHUHVSRQVLEOHDJHQWRIWKHVRFDOOHG IHZSRO\KHGUD
)3 PXWDWLRQVLQEDFXORYLUXVHVWKDWZHUHSDVVHGWKURXJKWKH 7QLFHOOOLQH71,WZDV
VXEVHTXHQWO\GHPRQVWUDWHGWKDW SLJJ\%DFWKHLQVHUWLRQRI ZKLFKLQWRWKH.JHQHRIWKH
YLUXV FDXVHV WKH )3 SKHQRW\SHV RULJLQDWHG IURP WKH JHQRPH RI WKH LQVHFW FHOOV LWVHOI 7KH
HOHPHQW LV  NE LQ OHQJWK DQG WHUPLQDWHV LQ ES SHUIHFW LQYHUWHG UHSHDWV FDUU\LQJ
,&&&«***, WHUPLQDO WULQXFOHRWLGH VHTXHQFHV $Q DGGLWLRQDO LQWHUQDO ES LQYHUWHG
UHSHDWLVORFDWHGDV\PPHWULFDOO\ZLWKUHVSHFWWRERWKHQGV7KHWUDQVSRVRQVHTXHQFHFDQEH
UHDGDVDVLQJOH25)HQFRGLQJDIXQFWLRQDOWUDQVSRVDVHZLWKDSUHGLFWHGVL]HRIN'D,Q
WKHEDFXORYLUXVJHQRPHLQVHUWHGHOHPHQWVZHUHV\VWHPDWLFDOO\IRXQGIODQNHGDWERWKHQGVE\
WKH WHWUDQXFOHRWLGH 77$$ LGHQWLI\LQJ D VLQJOH FKURPRVRPH WDUJHW VHTXHQFH 6HTXHQFHV
DGMDFHQWWRWKHWHUPLQLRIJHQRPLFUHSUHVHQWDWLYHVRISLJJ\%DFZHUHDOVR77$$FRQILUPLQJ
WKDW VSHFLILFLW\ IRU WKH WDUJHW VLWH LV DQHQGRJHQRXV SURSHUW\ RI WKH WUDQVSRVRQ ([FLVLRQ RI
SLJJ\%DFIURPEDFXORYLUXVLQVHUWLRQVLWHVLVSUHFLVHUHJHQHUDWLQJDVLQJOH77$$VHTXHQFH
WKHUHE\OHDYLQJQRIRRWSULQWEHKLQG

7KH VSHFLILFLW\ RI WKH WDUJHW VHTXHQFH DQG WKH SUHFLVLRQ RI H[FLVLRQ LPSOLFDWH WKH
RFFXUUHQFHRIDVLWHVSHFLILFUHFRPELQDWLRQPHFKDQLVPDQGPRUHRYHUVXJJHVWWKDW77$$LV
SDUW RI WKH VHTXHQFH UHFRJQL]HG E\ WKH SLJJ\%DF WUDQVSRVDVH 7KHVH DUH UHPDUNDEOH DQG
XQLTXHIHDWXUHVDPRQJW\SH,,WUDQVSRVRQVSLJJ\%DFKDVRQO\EHHQIRXQGLQFHUWDLQVWUDLQVRI
7QL VXJJHVWLQJ WKDW LW UHFHQWO\ LQYDGHG WKH JHQRPH RI WKLV VSHFLHV $ QHDUO\ LGHQWLFDO
HOHPHQWZDVIRXQGLQWKHJHQRPHRIWKHGLVWDQWGLSWHUDQ%DFWURFHUDGRUVDOLVZKLOHQRRWKHU
WHVWHG LQVHFW VSHFLHV ZHUH VKRZQ WR KDUERXU SLJJ\EDFN HOHPHQWV 0RUHRYHU WKH
H[SHULPHQWDOO\GHULYHGYHFWRUVDUHPRELOHLQERWKVSHFLHVVKRZLQJWKDWQRVWURQJHQGRJHQRXV
UHSUHVVLRQRIWUDQVSRVLWLRQKDVGHYHORSHGLQWKHWZRQDWXUDOKRVWV,WLVQRW XQGHUVWRRGKRZ
VXFKDKLJKO\PRELOHHOHPHQWDEOHWR WUDQVSRVH LQ PDQ\ GLYHUVHVSHFLHVLVQRWZLGHVSUHDG
DPRQJ LQVHFWV XQOHVV LW LV D YHU\ UHFHQW HYROXWLRQDU\ HYHQW 7KH ODFNRIKRVW VSHFLILFLW\ LQ
SLJJ\%DFPRELOL]DWLRQDQGWKHDEVHQFHRIHVWDEOLVKHGQHJDWLYHFRQWURORIWUDQVSRVLWLRQFUHDWH
DIDYRXUDEOHFRQWH[WIRUWKH SRWHQWLDO RFFXUUHQFH RIKRUL]RQWDO JHQHWUDQVIHU$VDSUDFWLFDO
FRQVHTXHQFHSLJJ\%DFXVDJHDVDWUDQVIRUPDWLRQYHFWRUVKRXOGEHUHVWULFWHGWRVSHFLHVWKDW
DUHQRWDLPHGDWEHLQJUHOHDVHGLQWKHZLOG

E7UDQVIRUPDWLRQPHWKRGRORJ\LQ%RPE\[PRUL


ϰϮϴ

 )RU WUDQVIRUPLQJ % PRUL WKH SLJJ\%DFEDVHG YHFWRUV ZHUH GHULYHG IURP WKH FORQHG
ZLOG W\SH HOHPHQW S( $V D UHSRUWHU V\VWHP D JHQH HQFRGLQJ WKH *UHHQ )OXRUHVFHQW
3URWHLQ *)3 ZDVFKRVHQEHFDXVHLWSURYLGHVDQHXWUDOGRPLQDQWPDUNHUWKDWLVDEVHQWLQWKH
HQGRJHQRXVJHQRPH7KHSURPRWHURIWKHF\WRSODVPLFDFWLQJHQH$ZDVXVHGWRGULYH*)3
H[SUHVVLRQDVLWLVDFWLYHLQPRVWRIWKHLQVHFWFHOOVDQGWLVVXHV7KHQRQDXWRQRPRXVKHOSHU
S+$3,* WKDWH[SUHVVHVWKHSLJJ\EDFNWUDQVSRVDVHZDVFRQWUROOHGE\WKHVDPHF\WRSODVPLF
DFWLQJHQHSURPRWHU

7KHREWDLQHGUHVXOWVVKRZHGWKDWDURXQGWRSHUFHQWRIWKHLQMHFWHGIHUWLOH*LQVHFWV
JLYHWUDQVIRUPHGSURJHQ\7KLVHIILFLHQF\RIWUDQVIRUPDWLRQ LV ZLWKLQ WKH UDQJH REWDLQHGLQ
'URVRSKLOD WUDQVJHQHVLV H[SHULPHQWV ,W PHDQV WKDW JHQH LQVHUWLRQ LQWKH JHUP OLQH LV QRWD
KLJKO\ IUHTXHQW HYHQW +RZHYHU WKH SURSRUWLRQ RI * ODUYDH ZKLFK IURP D VLQJOH EURRG
H[KLELWDWUDQVIRUPHGSKHQRW\SHYDULHVIURPOHVVWKDQWRPRUHWKDW7KLVPHDQVWKDW
WKH QXPEHU RI WUDQVIRUPHG JDPHWHV LQ WKH *2 DQLPDOV LV KLJKO\ YDULDEOH PRVW SUREDEO\
EHFDXVHLQWHJUDWLRQFDQRFFXUDWGLIIHUHQWVWDJHVRIWKHJHUPOLQHGHYHORSPHQW

*HQRPLF'1$DQDO\VLVVKRZHGWKDWWKHVDPHXQLTXHK\EULGL]LQJIUDJPHQWLVREVHUYHG
LQ DOO *)3 SRVLWLYH DQLPDOV VKRZLQJ WKDW WKH WUDQVJHQHV DUH LQWHJUDWHG ZLWKRXW GHWHFWDEOH
PRGLILFDWLRQV 7KH WUDQVJHQHV DUH VWDEO\ LQWHJUDWHG LQWR WKH JHQRPH DQG LQKHULWHG LQ
PHQGHOLDQ SURSRUWLRQV RYHU PRUH WKDQ  JHQHUDWLRQV ,Q SDUDOOHO QR H[WLQFWLRQ RI WKH
WUDQVJHQHH[SUHVVLRQKDVEHHQREVHUYHG

2QH UHPDUNDEOH SURSHUW\ RI WKH V\VWHP LV WKDW LQ VSLWH RI WKH ORZ IUHTXHQF\ RI
LQWHJUDWLRQ PXOWLSOH LQGHSHQGHQW LQVHUWLRQV RFFXU LQ WKH * WUDQVIRUPHG SDUHQWV 7KH
SUHVHQFHRIPXOWLSOH LQGHSHQGHQW LQVHUWVLQ VHYHUDO * ODUYDH LQGLFDWHV WKDW WKHLU * SDUHQW
KDUERXUHG VHYHUDO LQVHUWV LQ D VLQJOH JDPHWH DQG WKDW GLIIHUHQW JDPHWHV FDUULHG GLIIHUHQW
LQVHUWV+RZHYHULIPRVWRIWKHVHLQVHUWVZHUHSUHVHQWLQWKHVDPHJRQRF\WHVWKHGLVWULEXWLRQ
RI WKH LQVHUWV LQ WKH JDPHWHV DQG FRQVHTXHQWO\ LQ WKH * DQLPDOV ZRXOG EH LQ IDYRXU RI D
ODUJHU QXPEHURI LQVHUWVLQ HDFKDQLPDO 7KLVLQGLFDWHV WKDW SULRU WR PHLRVLV HDFK JRQRF\WH
FDUULHVRQO\DIHZWUDQVJHQHVDQGWKHUHIRUH WKDWJRQRF\WHV DUH GLIIHUHQW7KLV PD\ DULVH E\
WZRGLVWLQFWPHFKDQLVPV2QHLVWKHODWHRFFXUUHQFHRILQWHJUDWLRQHYHQWVGXULQJGHYHORSPHQW
RIWKHJHUPOLQH$QRWKHULVWKHH[LVWHQFHRIVXFFHVVLYHURXQGVRIWUDQVSRVLWLRQWDNLQJSODFH
DIWHUDVLQJOHRUDOLPLWHGQXPEHURILQLWLDOLQVHUWLRQHYHQWV

6XFKDK\SRWKHVLVZRXOGH[SODLQZK\LQVSLWHRILQIUHTXHQWLQVHUWLRQVLQWKHSDUHQWDO
SRSXODWLRQ WKH QXPEHU RI LQVHUWV LV KLJK LQ WKH IHZ WUDQVIRUPHG DQLPDOV 6XFFHVVLYH
WUDQVSRVLWLRQVFRXOGEHGULYHQE\WKHVWDELOLW\RIWKHWUDQVSRVDVHHQFRGHGE\WKHKHOSHUYHFWRU
RU E\ WKH H[LVWHQFH RI DQ HQGRJHQRXV FURVVPRELOL]LQJ DFWLYLW\ $V WKH FKURPRVRPDO
LQVHUWLRQVDUH KLJKO\ VWDEOHGXULQJ WKH QH[W JHQHUDWLRQV WKH VHFRQG SRVVLELOLW\ FDQ EH UXOHG
RXW $ VLPLODU VLWXDWLRQ RI DQ XQH[SHFWHG KLJK QXPEHU RI LQVHUWLRQV ZDV DOVR REVHUYHG LQ
WUDQVJHQLF & FDSLWDWD DQG LW ZDV DOVR DWWULEXWHG WR VHFRQGDU\ PRELOL]DWLRQV DIWHU DQ LQLWLDO
VLQJOH LQVHUWLRQ HYHQW 6LPLODU UHVXOWV KDYH EHHQ UHFHQWO\ REWDLQHG LQ SLJJ\%DFWUDQVIRUPHG
0GRPHVWLFDDQG %GRUVDOLV VXJJHVWLQJ WKDW LW LV D SURSHUW\RIWKHHOHPHQWLWVHOI2QHFDQ
VXJJHVW WKDW VXFFHVVLYH URXQGV RI WUDQVSRVLWLRQ DUH QRW GHOHWHULRXV EHFDXVH RI WKH SUHFLVH
H[FLVLRQ RI WKH HOHPHQW 7KLV SURSHUW\ PDNHV WKH V\VWHP KLJKO\ HIILFLHQW DQG SURYLGHV WKH
SRVVLELOLW\ RI GHULYLQJ QXPHURXV LQGHSHQGHQW WUDQVJHQLF OLQHV IURP D IHZ LQLWLDOO\
WUDQVIRUPHGLQGLYLGXDOV




ϰϮϵ

F+RZWRLPSURYHWKHWUDQVIRUPDWLRQSURFHGXUH"

6LONZRUP WUDQVJHQHVLV LV QRZ D URXWLQH PHWKRG OHDGLQJ WR D VDWLVIDFWRU\ \LHOG RI
WUDQVIRUPHG DQLPDOV DQG WR D UHOLDEOH H[SUHVVLRQ RI WUDQVJHQHV GXULQJ PXOWLSOH VXFFHVVLYH
JHQHUDWLRQVWKRXJKWKHSURWRFROLVSHUIHFWLEOHDQGVHYHUDOSDUDPHWHUVZDLWIRURSWLPL]DWLRQ,W
LVOLNHO\WKDWWKHVLWHRILQMHFWLRQLQWRWKHHJJWKH'1$FRQFHQWUDWLRQWKHKHOSHUWRVHOHFWLRQ
YHFWRU UDWLR WKH '1$ GHOLYHU\ SURFHGXUH FRXOG DIIHFW JHQH WUDQVIHU HIILFLHQF\ ,Q DOO
SUREDELOLW\ WKH LQVHUW VL]H LV QRW VWULFWO\ OLPLWHG EXW WKLV SDUDPHWHU KDV QRW EHHQ SUHFLVHO\
GHILQHGDQGQHHGVIXUWKHUVWXGLHV

7KUHHSURPRWHUVKDYHDOUHDG\EHHQLQFRUSRUDWHGLQWRSLJJ\%DFYHFWRUVWKHWUDQVSRVRQ
SURPRWHULWVHOIWKH'PHODQRJDVWHUKVSSURPRWHUDQGWKHF\WRSODVPLFDFWLQ$SURPRWHU
IURP % PRUL $OO RI WKHP DUH DFWLYH LQ PRVW DQLPDO WLVVXHV )RU IXUWKHU DSSOLFDWLRQV
WLVVXHVSHFLILF SURPRWHUV DUH KLJKO\ GHVLUDEOH $PRQJ PDQ\ ZH DUH FXUUHQWO\ DVVD\LQJ WKH
ZHOOFKDUDFWHUL]HGVLONJODQGVSHFLILFSURPRWHUVRIWKHVLONSURWHLQVHQFRGLQJJHQHV)RUWKH
WUDQVSRVDVHH[SUHVVLQJKHOSHUSODVPLGWKHXVHRIDJHUPOLQHVSHFLILFJHQHSURPRWHUDFWLYHLQ
WKHYHU\HDUO\VWDJHVRIJHUPFHOOSUHFXUVRUPXOWLSOLFDWLRQZRXOGEHYHU\ KHOSIXO7KLVZLOO
DOVRQHFHVVLWDWHEDVLFUHVHDUFKRQWKHVHVSHFLDOL]HGHPEU\RQLFFHOOVLQ%PRUL

1HZVHOHFWLRQPDUNHUVZRXOGDOVREHYHU\YDOXDEOHSDUWLFXODUO\IRULQVHUWLQJGLIIHUHQW
WUDQVJHQHV LQWKHVDPHLQGLYLGXDO$UHFHQWUHSRUWGHVFULEHGDQDUWLILFLDO SURPRWHU WKDW ZDV
VSHFLILFDOO\GHVLJQHGWREHRIXQLYHUVDOXVH7KLVSURPRWHUFRPSULVHVWKUHHELQGLQJVLWHVIRU
WKH'URVRSKLOD3D[SURWHLQDIDFWRUWKDWWULJJHUVH\HPRUSKRJHQHVLV7KHFRQVHUYDWLRQRI
WKH IDFWRU PDNHV WKLV SURPRWHU IXQFWLRQDO LQ SKRWRUHFHSWRU FHOOV RI GLVWDQWO\ UHODWHG LQVHFW
VSHFLHV'ULYLQJWKHH[SUHVVLRQRI*)3WKLVSURPRWHUSURYHGHIILFLHQWLQWKHVLONZRUP2WKHU
QHZPDUNHUVVKRXOGEHGHYLVHGDQGWKLVDOVRZLOOUHTXLUHIXQGDPHQWDOVWXGLHV7KHYHUVDWLOLW\
RIWKHV\VWHPFRXOGEHDOVRHQKDQFHGE\FRQVWUXFWLQJ%RPE\[OLQHVWKDWZRXOGFRQVWLWXWLYHO\
SURGXFH WKH WUDQVSRVDVH LQ RUGHU WR UHPRELOL]H WUDQVJHQHV LQ DOUHDG\ HVWDEOLVKHG OLQHV
6HFRQGDU\PRELOL]DWLRQYLDDSSURSULDWHFURVVLQJVRILQVHUWHGSLJJ\%DFVHTXHQFHVFRXOGDOVR
EHXVHGWRGHWHFWQRYHOJHQHVE\HQKDQFHUWUDSSLQJDSSURDFKHV6XFKDWUDQVSRVDVHSURGXFLQJ
OLQHFDQQRWEHHDVLO\FRQVWUXFWHGZLWKWKHSLJJ\%DFYHFWRULWVHOIEHFDXVHLWZRXOGEHKLJKO\
XQVWDEOH7KXVWKHDYDLODELOLW\RIQHZYHFWRUVUHPDLQVDGHVLUDEOHJRDO7KHVWUDWHJ\ZRXOG
EH WR LQVHUW WKH SLJJ\%DF WUDQVSRVDVH FRGLQJ VHTXHQFH LQWR DQRWKHU YHFWRU DQG WR GHULYH D
VWDEOH OLQH WR EH FURVVHG ZLWK SLJJ\%DF FDUU\LQJ OLQHV 6XFKD QHZ YHFWRU ZLOO DOVR KHOS WR
SURGXFH %RPE\[ OLQHV ZLWK PXOWLSOH LQVHUWV 6LPLODUO\ ZH FRQVLGHU WKH FRQVWUXFWLRQ RI D
%RPE\[OLQHSURGXFLQJWKH\HDVW*$/SURWHLQ7KLVWUDQVFULSWLRQDODFWLYDWRULVSURGXFHGLQD
YDULHW\ RI 'URVRSKLOD WUDQVJHQLF OLQHV ZKHUH LW GRHV QRW LQGXFH DQ\ GHYHORSPHQWDO GHIHFW
3ODFLQJWKH'1$WDUJHWVHTXHQFHUHFRJQL]HGE\*$/LQIURQWRIWUDQVJHQHVRILQWHUHVWZLOO
SHUPLWWKHLUH[SUHVVLRQDIWHUDSSURSULDWHFURVVLQJV2QWKLV EDVLV YDULRXV GHYHORSPHQWV DUH
FRQFHLYDEOH VXFK DV VWXG\LQJ GRPLQDQW QHJDWLYH HIIHFW RI WUXQFDWHG SURWHLQV WKH HIIHFW RI
RYHUSURGXFWLRQ RI SURWHLQ RI LQWHUHVW RI LGHQWLI\LQJ DQRQ\PRXV HQKDQFHU VHTXHQFHV 7KH
&5( UHFRPELQDVH VSHFLILFDOO\ UHFRJQL]HV WKH OR[ VHTXHQFH &UHDWLQJ D %RPE\[ OLQH WKDW
H[SUHVVHV WKLV HQ]\PH ZLOO EH KHOSIXO WR UHPRYH IRUHLJQ VHTXHQFHV SODFHG LQ EHWZHHQ WZR
LQYHUWHG OR[ VLWHV 7KLV VWUDWHJ\ LV ODUJHO\ DQG VXFFHVVIXOO\ XVHG LQ PRXVH WUDQVIRUPDWLRQ
VWXGLHV

7KHUHFHQWUHSRUWWKDWKRPRORJRXVUHFRPELQDWLRQFDQEHGHYHORSHGLQ%PRULLQRUGHU
WRNQRFNRXWJHQHVLVYHU\SURPLVLQJ7KHPHWKRGLVQRWFXUUHQWO\DURXWLQHSURFHGXUHGXHWR
LWV YHU\ ORZ \LHOG EXW LWV LPSURYHPHQW ZRXOG EH RI SULPH LQWHUHVW 7KH ILHOG RI % PRUL
WUDQVJHQHVLVLVODUJHO\RSHQ WR LPSURYHPHQWVDQG GHYHORSPHQWVWKDWZLOO UHTXLUHQHZEDVLF

ϰϯϬ

VWXGLHV RQ WKH V\VWHP $Q LQWHUQDWLRQDO FROODERUDWLRQ LV QHHGHG LQ RUGHU WR RSWLPL]H DQG
H[SORLWWKHSRWHQWLDORIWKLVPRGHOERWKLQIXQGDPHQWDOUHVHDUFKDQGDSSOLHGILHOGV

G $SSOLFDWLRQ RI QHZ YHFWRU XVLQJ ZLOG W\SH %RPE\[ N\QXUHQLQH PRQR R[\JHQDVH
JHQH

$ YLVLEOH PDUNHU IRU ILQGLQJ WKH WUDQVJHQLF VLONZRUPV ZDV GHYHORSHG XVLQJ %RPE\[
N\QXUHQLQH PRQR R[\JHQDVH JHQH XQGHU WKH FRQWURO RI F\WRSODVPLF DFWLQ JHQH SURPRWHU
$.02  DQG WKH Z PXWDQW VWUDLQ DV D KRVW 7KH YHFWRU )LJXUH   ZDV XVHG IRU WKH
FRQVWUXFWLRQRIWUDQVJHQLFVLONZRUPVIRUWKHFRPPHUFLDOSURGXFWV:KHQWKHYHFWRUZDVXVHG
WKHWUDQVJHQLF VLONZRUPV ZHUH GHWHFWHGE\WKH SUHVHQFH RI OLJKW EURZQ FRORXULQ WKH ODUYDO
LQWHJXPHQWV:HSHUIRUPHGWRFRQVWUXFWWKHWUDQVJHQLFVWUDLQVXVLQJWKHYHFWRUDQGVXFFHHGHG
WR PDNH VHYHUDO VWUDLQV ,Q DGGLWLRQ WKHUH LV D UHODWLRQ EHWZHHQ WKH OHYHOV RI H[SUHVVLRQ RI
.02DQGLQWURGXFHGIRUHLJQJHQHV,WZDVWKRXJKWWKDWWKHYHFWRULVXVHIXOIRUWKHSURGXFWLRQ
RIFRPPHUFLDOPDWHULDOVEHFDXVHWKHYHFWRUGRHVQRWFRQWDLQDQ\IOXRUHVFHQWPDUNHUJHQHWKH
XVHRIWKHYHFWRUDYRLGVWKHSDWHQWRIIOXRUHVFHQWSURWHLQJHQH


)LJXUH3K\VLFDOPDSRISLJJ\%DFYHFWRUXVLQJ WKHVLONZRUPN\QXUHQLQHR[LJHQDVH
JHQH $.02ࠊPDUNHU JHQH㸹DUURZࠊLQYHUWHG WHUPLQDO UHSHDW VHTXHQFH RI WUDQVSRVRQ
SLJJ\%DF㸬

H,GHQWLILFDWLRQRI<HOORZEORRGJHQHE\XVHRIWUDQVJHQLFVLONZRUPV

<HOORZEORRGJHQH < ZDVNQRZQWRPDNH\HOORZODUYDOEORRGDQGFRFRRQ6LQFH<LV
D GRPLQDQW JHQH LW PD\ EH XVHIXO DV D QHZ PDUNHU 7KH JHQH LV UHODWHG WR WKH XSWDNH RI
FDURWHQRLGIURPPLGJXWWRWKHEORRG7KHUHIRUHWKHFDURWHQRLGELQGLQJSURWHLQ &%3 JHQH
LQWKHPLGJXWZDVWKRXJKWWREHWKHPRVWSUREDEOHFDQGLGDWH7KHFDURWHQRLGF'1$IURPWKH
\HOORZEORRGVWUDLQZDVLVRODWHGDQGWKHF'1$ZDVLQVHUWHGLQWRWKHGRZQVWUHDPRIXSVWUHDP
DFWLYDWLRQVHTXHQFHRI\HDVWWUDQVFULSWLRQIDFWRU*$/7KLVFDURWHQRLGJHQHZDVLQWURGXFHG
LQWRWKHQRUPDOVLONZRUPVWUDLQZLWKWKHQRUPDOZKLWHEORRGDQGFRFRRQ7KHH[SUHVVLRQRI
WKHLQWURGXFHGJHQHZDVIRUFHGLQWKHPLGJXWDQGPLGGOHSDUWRIVLONJODQGE\FURVVLQJZLWK
WKH *$/ VWUDLQ 7KH EORRG EHFRPHV \HOORZ ZKHQ LW LV H[SUHVVHG LQ WKH PLG JXW DQG WKDW
\HOORZFRFRRQVFDQEHSURGXFHGZKHQWKHFDURWHQRLGELQGLQJSURWHLQJHQHZDVH[SUHVVHGLQ
PLGJXWDQGPLGGOHSDUWRIVLONJODQG )LJXUH )URPWKHUHVXOWVLWFDQEHFRQFOXGHG<DV
WKHFDURWHQRLGELQGLQJSURWHLQJHQH

ϰϯϭ

 
)LJXUH  7KHODUYDH OHIW  DQG FRFRRQV ULJKW  RIWKH WUDQVJHQLF VLONZRUP H[SUHVVLQJ
FDURWHQRLGELQGLQJSURWHLQLQWKHPLGJXWDQGPLGGOHSDUWRIVLONJODQGE\*$/8$6
V\VWHP7KH\HOORZODUYDDQGFRFRRQDUHWUDQVJHQLF7KHZKLWHDQGRSDTXHODUYDDQGZKLWH
FRFRRQDUHQRQWUDQVJHQLFDVDFRQWURO

I'HYHORSPHQWRIUHJXODWLRQV\VWHPRIWKHLQWURGXFHGJHQHLQWKHWUDQVJHQLFVLONZRUPV

7R GHYHORS DQ HIILFLHQW H[SUHVVLRQ V\VWHP IRU WKH LQWURGXFHG JHQH WKH HIIHFW RI
GLIIHUHQWW\SHVRI*$/RQWKHH[SUHVVLRQRIWKHWUDQVJHQHXQGHUWKHFRQWURORI 8$6ZHUH
VWXGLHG 6L[ GLIIHUHQW W\SHV RI WKH JHQHV ZHUH FRQVWUXFWHG WR VXEVWLWXWH WKH VHTXHQFH RI
DFWLYDWRUGRPDLQRI*$/WRWKDWRIS9 %RPE\[5(/ DQG5(/,6+7KHDFWLYLW\RI
WKH LPSURYHG *$/ JHQH ZDV WHVWHG ZLWK WKDW RI RULJLQDO *$/ DQG GHOWD *$/ LQ WKH
FXOWXUHGFHOOV,WZDVIRXQGWKDWWKHVXEVWLWXWLRQRIDFWLYDWRUVHTXHQFHRI*$/ZLWKSDQG
9LVYHU\HIIHFWLYH7KH*$/ZLWKSDFWLYDWRUGRPDLQDQG9VKRZHGDQGIROG
LQFUHDVH RI WKH DFWLYLW\ FRPSDUHG WR WKH RUGLQDO *$/ 6WXGLHV DUH LQ SURJUHVV WR ILQG RXW
KRZWKHQHZ*$/JHQHLVXVHIXOLQWKHWUDQVJHQLFVLONZRUP

J%UHHGLQJRIQHZVLONZRUPVWUDLQVIRUWKHSURGXFWLRQRIUHFRPELQDQWSURWHLQ

7R EUHHG QHZ VLONZRUP VWUDLQV WKDW DUH DGDSWHG IRU WKH SURGXFWLRQ RI UHFRPELQDQW
SURWHLQV1GV'PXWDQWVWUDLQZDVFURVVHGZLWKWKH-DSDQHVHDQG&KLQHVHSDUHQWVWUDLQVZLWK
KLJK SURGXFWLYLW\ 7KH EUHHGLQJ ZRUNV YHU\ ZHOO 7KH UDWLRV PDNLQJ FRFRRQ DQG EHFRPLQJ
SXSD LQ WKH EUHG VWUDLQV ZHUH PDUNHGO\ LQFUHDVHG 7KH EUHHGLQJ ZDV DOVR DSSOLHG IRU WKH
WUDQVJHQLFVWUDLQVZLWKWKHIOXRUHVFHQWSURWHLQJHQH7KHFRFRRQVRIWKHVWUDLQVZLWKWKHJUHHQ
IOXRUHVFHQWDQGUHGFRFRRQVZHUHPXFKLPSURYHG$VVKRZQLQ)LJXUHWKHVL]HRIFRFRRQ
LVLQFUHDVHGDQGWKHFRORXULQWKHFRFRRQDQGVLONVEHFRPHPXFKFOHDU

ϰϯϮ

 
)LJXUH  &RFRRQV DQG VLON ZLWK JUHHQ DQG UHG IOXRUHVFHQFH E\ QHZO\ EUHG
WUDQVJHQLFVLONZRUPVWUDLQV8SSHUSDQHOFRFRRQVREVHUYHGE\YLVLEOHOLJKWPLGGOHSDQHO
FRFRRQVE\IOXRUHVFHQWOLJKWORZHUSDQHOVLONVE\IOXRUHVFHQWOLJKW



5HIHUHQFHV

$KQ -6 &KRL +. /HH .+ 1DKP -+ DQG &KR 6   1RYHO PXFRDGKHVLYH
SRO\PHU SUHSDUHG E\ WHPSODWH SRO\PHUL]DWLRQ RI DFU\OLF DFLG LQ WKH SUHVHQFH RI VLON
VHULFLQ-$SSO3RO\P6FL±
$NDL + ,PDL 7 DQG 7VXERXFKL .   )LQH VWUXFWXUDO FKDQJHV RI OLTXLG VLON LQ WKH
VLONJODQGGXULQJWKHVSLQQLQJVWDJHRI%RPE\[PRULODUYDH-VHULF6FL-SQ

$NDL +7 1DJDVKLPD 7 ,QRXH 6 .RED\DVKL , DQG 7DUPXUD 7   )XQFWLRQDO
UHFRYHU\ RI WUDQVJHQLF VLON JODQG WK FRQJUHVV RI WKH LQWHUQDWLRQDO VHULFXOWXUDO
FRPPLVVLRQ%DQJDORUH,QGLDWK'HFHPEHUSS
$QQDPDULD 6 0DULD 5 7XOOLD 0 6LOYLR 6 DQG 2ULR &   7KH PLFURELDO
GHJUDGDWLRQ RI VLON D ODERUDWRU\ LQYHVWLJDWLRQ ,QW %LRGHWHULRU %LRGHJUDG  ±

$VDNXUD 7 <DPDUH 7 1DND]DZD < .DPDGD 7 DQG $QGR .   6WUXFWXUH RI
%RPE\[PRULVLONILEURLQEHIRUHVSLQQLQJLQVROLGVWDWHVWXGLHGZLWKZLGHDQJOH;UD\
VFDWWHULQJDQGFURVVSRODUL]DWLRQPDJLFDQJOHVSLQQLQJ105%LRSRO\PHUV

$VODQL 0$ DQG (UDO 0   ,QYHVWLJDWLRQ RI XUDQLXP UHFRYHU\ IURP GLOXWH DTXHRXV
VROXWLRQVXVLQJVLONILEURLQ%LRO7UDFH(OHP5HV
%RVH3&0DMXPGDU6.DQG6HQJXSWD.   5ROHRI WKHDPLQRDFLGV LQVLONZRUP
%RPE\[ PRUL / QXWULWLRQ DQG WKHLU RFFXUUHQFH LQ KDHPRO\PSK VLON JODQG DQG VLON
FRFRRQV±$UHYLHZ,QGLDQ-6HULF

ϰϯϯ

&KDYDQF\ *   6LONZRUP IRU QRQWH[WLOH LQGXVWULHV 6RXYHQL WK FRQJUHVV RI WKH
LQWHUQDWLRQDOVHULFXOWXUDOFRPPLVVLRQ%DQJDORUH,QGLDWK'HFHPEHUSS

&KHYLOODUG 0 &RXEOH3 DQG 3UXGKRPPH -& D  &RPSOHWH QXFOHRWLGH VHTXHQFH RI
WKH JHQH HQFRGLQJ WKH %RPE\[ PRUL VLON SURWHLQ 3 DQG SUHGLFWHG DPLQR DFLG
VHTXHQFHRIWKHSURWHLQ1XFOHLF$FLGV5HV
&KHYLOODUG 0 'HOHDJH * DQG &RXEOH 3 E  $PLQR DFLG VHTXHQFH DQG SXWDWLYH
FRQIRUPDWLRQDOFKDUDFWHULVWLFRIWKH3VLONSURWHLQRI%RPE\[PRUL6HULFRORJLD

&KLVWL<  6WUDWHJLHVLQGRZQVWUHDPSURFHVVLQJLQ%LRVHSDUDWLRQDQGELRSURFHVVVLQJ
DKDQGERRN*6XEUDPDQLDQ HG 1HZ<RUN:LOH\9&+SS±
'HPXUD 0 $VDNXUD 7 .XURR 7   ,PPRELOL]DWLRQ RI ELRFDWDO\VWV ZLWK %RPE\[
PRUL VLON ILEURLQ E\ VHYHUDO NLQGV RI SK\VLFDO WUHDWPHQW DQG DSSOLFDWLRQ WR JOXFRVH
VHQVRUV%LRVHQVRUV
)HL\LQJ6 %R[LRQJ=&KHQIX/%R+-LDQNH/,-LDQ\LQJ/,-LIHQJ -.HIHQJ
;88DQMLH<<-LDQVKH/+DLVKHQJ;86RQJNXQ68DQG*XRKXD<  
$QDO\VLV RI SURWHLQ YDULHW\ RI WKH PLGGOH VLON JODQG FHOOV RI WKH WK LQVWDU ODUYDH RI
VLONZRUP%RPE\[PRUL/WKFRQJUHVVRIWKHLQWHUQDWLRQDOVHULFXOWXUDOFRPPLVVLRQ
%DQJDORUH,QGLDWK'HFHPEHUSS

)WLW]$QQHDQG&DQW-HQQLIHU  &RQVXPHU7H[WLOHV2[IRUG8QLYHUVLW\3UHVV$XVWUDOLD

5HSULQW

*DPR7DQG6RWR6  8OWUDVWUXFWXUDOVWXG\RIWKHSRVWHULRUVLONJODQGLQWKH1G1GV

DQG1VVPXWDQWVZLWKDGHIHFWRIILEURLQV\QWKHVLV-VHULF6FL-SQ

*RRG,UHQH³2QWKHTXHVWLRQRIVLONLQSUH+DQ(XUDVLD´$QWLTXLW\9RO1XPEHU
'HFHPEHUSS±

*RWRK.,]XPL+.DQDPRWR77DPDGD<1DNDVKLPD+  6XOIDWHGILEURLQD

QRYHO VXOIDWHG SHSWLGH GHULYHG IURP VLON LQKLELWV KXPDQ LPPXQRGHILFLHQF\ YLUXV
UHSOLFDWLRQ LQ YLWUR %LRVFL %LRWHFKQRO 5HODWHG $UWLFOHV %RRNV %LRFKHP  

*UHJRU\+$'LD])&DUROLQH-7RUD&5HEHFFD/+-LQJVRQJ&+HOHQ/-RKQ
5DQG'DYLG/.  6LONEDVHGELRPDWHULDOV%LRPDWHULDOV
*XOUDMDQL 0/   6HULFLQ $ %LRPROHFXOH RI YDOXH 6RXYHQL WK FRQJUHVV RI WKH
LQWHUQDWLRQDO VHULFXOWXUDO FRPPLVVLRQ %DQJDORUH ,QGLD WK 'HFHPEHU  SS

*XOUDMDQL 0/   'HJXPPLQJ RI VLON LQ 6LON G\HLQJ SULQWLQJ DQG ILQLVKLQJ 0/
*XOUDMDQL HG 'HSDUWPHQWRI7H[WLOH7HFKQRORJ\,QGLDQ,QVWLWXWHRI7HFKQRORJ\1HZ
'HOKLSS
+DWDNH\DPD +   %LRGHJUDGDEOH VHULFLQFRQWDLQLQJ SRO\XUHWKDQH DQG LWV SURGXFWLRQ
-DSDQ3DWHQW$

+LOO-RKQ(7KH3HRSOHVRIWKH:HVWIURPWKH:HLOHE\<X+XDQ$7KLUG&HQWXU\
&KLQHVH$FFRXQW&RPSRVHGEHWZHHQDQG$''UDIWDQQRWDWHG(QJOLVK
WUDQVODWLRQ$SSHQGL[(

ϰϯϰ

+X.  %LRFRPSDWLEOH)LEURLQ%OHQGHG)LOPVZLWK5HFRPELQDQW+XPDQOLNH&ROODJHQ
IRU+HSDWLF7LVVXH(QJLQHHULQJ-RXUQDORI%LRDFWLYHDQG&RPSDWLEOH3RO\PHUV

,L]XND(  6LONVHULFLQRI%RPE\[PRUL/%LRFKHP%LRSK\V$FWD
,QRXH6.DQGD7,PDPXUD04XDQ*;.RMPD.7DQDND+7RPLWD0+LQR5
<RVKL]DWR . 0L]XQR 6 $QG 7DPXUD 7   $ ILEURLQ VHFUHWLRQ GHILFLHQW
VLONZRUP PXWDQW 1GV' SURYLGHV DQ HIILFLHQW V\VWHP IRU SURGXFLQJ UHFRPELQDQW
SURWHLQV,QVHFW%LRFKHP0RO%LRO
,QRXH 6 7DQDND . $ULVDND ) .LPXUD 6 2KWRPR . DQG 0L]XQR 6   6LON
ILEURLQRI%RPE\[PRULLVVHFUHWHGDVVHPEOLQJDKLJKPROHFXODUPDVVHOHPHQWDU\XQLW
FRQVLVWLQJ RI +FKDLQ /FKDLQ DQG 3 ZLWKD  PRODU UDWLR - %LRO &KHP 

,QRX\H..XURNDZD01LVKLNDZD6$QG7VXNDGD0  8VHRI%RPE\[PRULVLON
ILEURLQDVDVXEVWUDWXPIRUFXOWLYDWLRQRIDQLPDOFHOOV-%LRFKHP%LRSK\V0HWK

,VKLNDZD + DQG +LUDED\DVKL .   &RPSLODWLRQ RI VWXGLHV RI VLON UHHOLQJ DQG VLON
6HLVKL±.LQX.HQN\D±+DSS\R6KXURNX
,VKLNDZD+1DJXUD0DQG7VXFKL\D<  )LQHVWUXFWXUHDQGSK\VLFDOSURSHUWLHVRI
EOHQGILOPFRPSRVHRIVLONVHULFLQDQGSRO\ YLQ\ODOFRKRO 6HQ¶L*DNNDLVKL±

-DLQ <( -LDQ\LQJ /, -LQH & DQG %R[LQJ =   $QDO\VLV RI 'SDJH SDWWHUQV RI
SURWHLQIURPSRVWHULRUVLONJODQGRIGLIIHUHQWEUHHGVVLONZRUP%RPE\[PRUL/RQWKH
WK GD\ LQ WK LQVWDU WK FRQJUHVV RI WKH LQWHUQDWLRQDO VHULFXOWXUDO FRPPLVVLRQ
%DQJDORUH,QGLDWK'HFHPEHUSS

.DGROSK6DUD-7H[WLOHVWKHG8SSHU6DGGOH5LYHU3HDUVRQ3UHQWLFH+DOO

.DWR 1 6DWR 6 <DPDQDND $ <DPDGDP + )XZDP 1 DQG 1RPXUD 0   6LON
SURWHLQ VHULFLQ LQKLELWVOLSLG SHUR[LGDWLRQ DQG W\URVLQDVHDFWLYLW\%LRVFL %LRWHFKQRO
%LRFKHP±
.HQML26RPDVKHNDU51RJXFKL.$QG6\XML,  5HILQHGPROHFXODUDQGFU\VWDO
VWUXFWXUH RI VLON , EDVHG RQ $OD*O\ DQG $OD*O\  6HU*O\ SHSWLGH VHTXHQFH
%LRSRO\PHUV
.RPDWVX .   6WXGLHV RQ GLVVROXWLRQ EHKDYLRUV DQG VWUXFWXUDO FKDUDFWHULVWLF RI VLON
6HULFLQ%XOO6HULFXOW([S6WD
.RPDWVX.  6LON,,,6HULFLQSK\VLFDOVWUXFWXUH6HULFRORJLD
.RPDWVX.5HFHQWDGYDQFHVLQVHULFLQUHVHDUFK-6HULFXOW6FL-DSDQ
.RQLVKL7  6WUXFWXUHRIILEURLQ±LQ6WUXFWXUHRIVLON\DUQ+RMR1 HG 2[IRUGDQG
,%+SXEOLFDWLRQ&R3YW/WG1HZ'HOKLSS

.XKQ'LHWHU³6LON:HDYLQJLQ$QFLHQW&KLQD)URP*HRPHWULF)LJXUHVWR3DWWHUQVRI
3LFWRULDO/LNHQHVV´&KLQHVH6FLHQFH  SS±

.XULRND $ DQG <DPD]DNL 0   3XULILFDWLRQ DQG LGHWLILFDWLRQ RI IODYRQRLGV IURP WKH
\HOORZ JUHHQ FRFRRQ VKHOO 6DVDPD\X  RI WKH VLONZRUP %RPE\[ PRUL %LRVFL
%LRWHFKQRO%LRFKHP
/L;  8VDJHVRIVHULFLQLQGXUDEOHPDWHULDO&KLQDSDWHQW$

/LX;LQUX6LONDQG5HOLJLRQ$Q([SORUDWLRQRI0DWHULDO/LIHDQGWKH7KRXJKWRI
3HRSOH$'2[IRUG8QLYHUVLW\3UHVV

ϰϯϱ

0DWWD$0LJOLDUHVL&)DFFLRQL)7RUULFHOOL3)LQL0DQG*LDUGLQR5  ILEURLQ
K\GURJHOV IRU ELRPHGLFDO DSSOLFDWLRQV SUHSDUDWLRQ FKDUDFWHUL]DWLRQ DQG LQ YLWUR FHOO
FXOWXUHVWXGLHV-%LRPDWHU6FL3RO\P
0LQRXUD1$LED6*RWRK<7VXNDGD0DQG,PDL7  $WWDFKPHQWDQGJURZWKRI
FXOWXUHGILEUREODVWFHOOVRQVLONSURWHLQPDWULFHV-%LRPHG0DW±
0L\DLUL 6 DQG 6XJLXUD 0   3URSHUWLHV RI EJOXFRVLGDVH LPPRELOL]HG LQ VHULFLQ
PHPEUDQH-)HUPHQ7HFK±
0L]RJXFKL . ,ZDWVXER 7 DQG $LVDND 1   6HSDUDWLQJ PHPEUDQH PDGH RI FURVV
OLQNHGWKLQILOPRIVHULFLQDQGSURGXFWLRQWKHUHRI-DSDQ3DWHQW$
0RUL.7DQDND..LNXFK<:DJD0:DJD6DQG0L]XQR6  3URGXFWLRQRID
FKLPHULF ILEURLQ OLJKWFKDLQ SRO\SHSWLGH LQ D ILEURLQ VHFUHWLRQ GHILFLHQW QDNHG SXSD
PXWDQWRIWKHVLONZRUP%RPE\[PRUL-0RO%LR
0XUDVH0  0HWKRGIRUVROXELOLVLQJDQGPROGLQJFRFRRQVLONDUWLILFLDORUJDQPDGHRI
FRFRRQVLONDQGPHGLFDOHOHPHQWPDGHRIFRFRRQVLON-DSDQ3DWHQW$
1DNDMLPD<  /LTXLGFU\VWDOHOHPHQW-DSDQ3DWHQW
3DGDPZDU013DZDU$3'DLWKDQNDU$9DQG0DKDGLN.5  6LONVHULFLQDVD
PRLVWXUL]HUDQLQYLYRVWXG\-&RVPHW'HUPDW
3KLOOLSV '0 'UXPP\ /) 1DLN 55 'HORQJ +& )R[ '0 7UXORYH 3& DQG
0DQW]5$  6LONILEUHVIURPDQLRQLFOLTXLGVROXWLRQ-0DWHU&KHP
3XEOLFDWLRQ&R3YW/WG1HZ'HOKLSS
5REVRQ 50   6LON FRPSRVLWLRQ VWUXFWXUH DQG SURSHUWLHV LQ +DQG ERRN RI ILEUH
6FLHQFHDQG7HFKQRORJ\YRO,9/HZLQ0DQG(0SHDUFH HG 0HUFHO'HNNHU,QF
1HZ<RUNSS
5XL+*  4XDOLW\RI&RFRRQ)LODPHQWLQ6LONUHHOLQJ+*5XL HG 2[IRUG ,%+
6DGRY).RUFKDJLQ0DQG0DWHWVN\$  &KHPLFDOWHFKQRORJ\RIILEURXVPDWHULDOV
0LU3XEOLFDWLRQ0RVFRZSS
6KLPL]X0  6WUXFWXUDO EDVLVRIVLONILEUHLQ6WUXFWXUHRIVLON \DUQ´ YRO ,ELRORJLFDO
DQG SK\VLFDO DVSHFWV 1 +RMR HG  2[IRUG  ,%+ 3XEOLFDWLRQ &R 3YW /WG 1HZ
'HOKLSS
6KLPXUD..LNXFKL$.DWDJDWD<$QG2KWRPRN.  7KHRFFXUUHQFHRIVPDOOHVW
FRPSRQHQWSURWHLQLQWKHFRFRRQRI%RPE\[PRUL-6HULF6FL-SQ
6XQJ<LQJ+VLQJ&KLQHVH7HFKQRORJ\LQWKH6HYHQWHHQWK&HQWXU\7 LHQNXQJ. DL
ZX 7UDQVODWHG DQG DQQRWDWHG E\ (WX =HQ 6XQ DQG 6KLRXFKXDQ 6XQ 3HQQV\OYDQLD
6WDWH8QLYHUVLW\3UHVV5HSULQW'RYHU&KDS&ORWKLQJPDWHULDOV
7DPDGD<  $QWLFRDJXODQWDQGLWVSURGXFWLRQ-DSDQ3DWHQW$
7DQDND.DPG0L]XQR6  +RPRORJXHVRIILEURLQ/FKDLQDQG3RI%RPE\[PRUL
DUH SUHVHQW LQ 'HQGUROLPXV VSHFWDELOLV DQG 3DSLOLR [XWKXV EXW QRW GHWHFWDEOH LQ
$QWKHUDHD\DPDPDL,QVHFW%LRFKHP0RO%LRO
7DQDND..DML\DPD1,VRKLNXUD.:DJD6.XNXFKL$2KWRPR.7DNDJL7DQG
0L]XQR 6   'HWHUPLQDWLRQ RI WKH VLWH RI GLVXOILGH OLQNDJH EHWZHHQ KHDY\ DQG
OLJKWFKDLQRIVLONILEURLQSURGXFHGE\%RPE\[ PRUL%LRFKHP%LRSK\V$FWD

7RNXWDNH 6   ,VRODWLRQ RI WKH VPDOOHVW FRPSRQHQW RI VLON SURWHLQ %LRFKHPLVWU\
%LRFKHP-
7VXERXFKL. D :RXQGFRYHULQJPDWHULDO86SDWHQW
7VXERXFKL . E  2FFOXVLYH GUHVVLQJ FRQVLVWLQJ HVVHQWLDOO\ RI VLON ILEURLQ DQG VLON
VHULFLQDQGLWVSURGXFWLRQ-DSDQ3DWHQW$
7VXNDGD0  6WUXFWXUHRIVLONVHULFLQVUHPRYHGIURPZLOGVLONE\ERLOLQJLQZDWHU-
6HULFXOW6FL-DSDQ

ϰϯϲ

7VXNDGD0+D\DVDND6,QRXH.1LVKLNDZD6DQG<DPDPRWR6  &HOOFXOWXUH
EHG VXEVWUDWH IRU SUROLIHUDWLRQ RI DQLPDO FHOO DQG LWV SUHSDUDWLRQ -DSDQ 3DWHQW 
$
:X &< 7LDQ %= =KX ' <DQ ;0 &KHQ : DQG ;X *<   3URSHUWLHV DQG
DSSOLFDWLRQ RI ZRXQG SURWHFWLYH PHPEUDQH PDGH IURP ILEURLQ ,Q ,QWHUQDWLRQDO VLON
FRQJUHVV6X]RX,QVWLWXWHRIVLONWHFKQRORJ\6X]RX&KLQDWK2FWREHUSS
<DPDGD + DQG )XZD 1   3URWHLQ FRQWDLQLQJ KLJK PROHFXODU PDWHULDO DQG LWV
DSSOLFDWLRQ-DSDQSDWHQW$
<DPDGD + )XZD 1 DQG 1RPXUD 0   6\QWKHWLF ILEUH KDYLQJ LPSURYHG
K\JURVFRSLFLW\-DSDQSDWHQW$
<DPDGD 0   $PLQR DFLG FRPSRVLWLRQ RI WKH VHULFLQ H[WUDFWHG IURP FRFRRQ RI WKH
PXOEHUU\ ZLOG VLONZRUP %RPE\[ PRUL DQG LWV VSHFLHV VSHFLILFLW\ - 6HULFXOW 6FL
-DSDQ
<DPDJXFKL..LNXFKL<7DNDJL7.LNXFKL$2\DPD)6KLPXUD.$QG0L]XQR
6   3ULPDU\ VWUXFWXUH RI WKH VLON ILEURLQ OLJKW FKDLQ GHWHUPLQHG E\ F'1$
VHTXHQFLQJDQGSHSWLGHDQDO\VLV-0RO%LR
<DPDPRWR 7 0L\DMLPD 7 0DVH . $QG ,L]XND 7   %UHHGLQJ RI VLONZRUP UDFH
µ6HULFLQKRSH¶VHFUHWLQJVLONSURWHLQLQZKLFKVHULFLQLVFRQWDLQHGKLJKFRQFHQWUDWLRQ
$QQXDOUHSRUWRI1DWLRQDOLQVWLWXWHRI$JURELRORJLFDO6FLHQFH-DSDQSS
<RVKLL ) .XPH 1 0DNXXFKL . DQG 6DWR )   +\GURJHO FRPSRVLWLRQ FRQWDLQLQJ
VLONSURWHLQ-DSDQ3DWHQW$
<RVKLPXUD 7 6KLPL]X < .XURWDQL :<DPDRND 5 DQG +D\DVKL\D .  
$SSOLFDWLRQRIILEURLQPHPEUDQHWRLPPRELOL]LQJFRHQ]HGLQVHFWFHOOFXOWXUHIRUXVHDV
YDFFLQH$JULDQG%LRO&KHP
=KDRULJHWX 61 6DVDNLP 0 :DWDQEH + DQG .DWR 1   6LON SURWHLQ VHULFLQ
VXSSUHVVHV '0%$73$ LQGXFHG PRXVH VNLQ WXPRULJHQHVLV E\ UHGXFLQJ R[LGDWLYH
VWUHVV LQIODPPDWRU\ UHVSRQVHV DQG HQGRJHQRXV WXPRU SURPRWHU 71)DOSKD 2QFRO
5HS
=KRX &= &RQIDORQLHUL ) 0HGLQD 1=LYDQRYLF < (VQDXOW & -DFTXHW 7 -DQLQ -
'XJXHW03HUDVVR5DQG/L]*  )LQHRUJDQL]DWLRQRI%RPE\[PRULILEURLQ
KHDY\FKDLQJHQH1XFO$FLGV5HV







&KDSWHU

,QYLWUR)HUWLOL]DWLRQ

3DSDQLNRODRX (* &DPXV 0 .ROLELDQDNLV (0 9DQ /DQGX\W / 9DQ 6WHLUWHJKHP $ 'HYURH\ 3
  ,Q 9LWUR )HUWLOL]DWLRQ ZLWK 6LQJOH %ODVWRF\VW6WDJH YHUVXV 6LQJOH &OHDYDJH6WDJH
(PEU\RV1(QJO-0HG  
GH/D5RFKHEURFKDUG(4XHOHQ&3HLNULVKYLOL5*XLEHUW-%RX\HU-  /RQJWHUPRXWFRPHRI
SDUHQWKRRGSURMHFWGXULQJLQYLWURIHUWLOL]DWLRQDQGDIWHUGLVFRQWLQXDWLRQRIXQVXFFHVVIXOLQYLWUR
IHUWLOL]DWLRQ)HUWLO6WHULO  ±
/ 6FKPLGW %( +ROVWHLQ 8 &KULVWHQVHQ - %RLYLQ &RPPXQLFDWLRQ DQG FRSLQJ DV SUHGLFWRUV RI
IHUWLOLW\SUREOHPVWUHVVFRKRUWVWXG\RISDUWLFLSDQWVZKRGLGQRWDFKLHYHDGHOLYHU\DIWHU
PRQWKVRIIHUWLOLW\WUHDWPHQW+XP5HSURG±

ϰϯϳ

2OLYHQQHV ) 0DQQDHUWV % 6WUXLMV 0 %RQGXHOOH 0 'HYURH\ 3   3HULQDWDO RXWFRPH RI
SUHJQDQF\ DIWHU *Q5+ DQWDJRQLVW JDQLUHOL[  WUHDWPHQW GXULQJ RYDULDQ VWLPXODWLRQ IRU
FRQYHQWLRQDO,9)RU,&6,DSUHOLPLQDU\UHSRUW+XP5HSURG  ±
:DJHQDDU . YDQ :HLVVHQEUXFK 00 .QRO '/ &RKHQ.HWWHQLV 37 'HOHPDUUHYDQ GH :DDO +$
+XLVPDQ- 2FWREHU %HKDYLRUDQGVRFLRHPRWLRQDOIXQFWLRQLQJLQ\HDUROGFKLOGUHQ
ERUQDIWHULQYLWURIHUWLOL]DWLRQ)HUWLO6WHULO  ±
.XULQF]XN--  6DIHW\LVVXHVLQDVVLVWHGUHSURGXFWLRQWHFKQRORJ\)URPWKHRU\WRUHDOLW\²MXVW
ZKDW DUHWKHGDWD WHOOLQJ XV DERXW ,&6,RIIVSULQJ KHDOWK DQG IXWXUHIHUWLOLW\ DQG VKRXOGZH EH
FRQFHUQHG"+XP5HSURG  ±
5HHIKXLV - +RQHLQ 0$ 6FKLHYH /$ &RUUHD $ +REEV &$ 5DVPXVVHQ 6$   $VVLVWHG
UHSURGXFWLYHWHFKQRORJ\DQGPDMRUVWUXFWXUDOELUWKGHIHFWVLQWKH8QLWHG6WDWHV+XP5HSURG
  ±
KWWSZZZVFUFLYIFRPKWPOSJGKWPO
KWWSZZZPRWKHUMRQHVFRPQHZVIHDWXUHVRXOVBRQBLFHKWPO
3RUFX()DEEUL5'DPLDQR*)UDWWR5*LXQFKL69HQWXUROL6  2RF\WHFU\RSUHVHUYDWLRQLQ
RQFRORJLFDOSDWLHQWV(XU-2EVWHW*\QHFRO5HSURG%LRO6XSSO6±
$QGHUVRQ %- +DLPRYLFL ) *LQVEXUJ (6 6FKXVW '- :D\QH 30   ,Q YLWUR IHUWLOLVDWLRQ DQG
DFXSXQFWXUHFOLQLFDOHIILFDF\DQGPHFKDQLVWLFEDVLV$OWHUQ7KHU+HDOWK0HG  ±
0DQKHLPHU(=KDQJ*8GRII/HWDO 0DUFK (IIHFWVRIDFXSXQFWXUHRQUDWHVRISUHJQDQF\
DQG OLYH ELUWK DPRQJ ZRPHQ XQGHUJRLQJ LQ YLWUR IHUWLOLVDWLRQ V\VWHPDWLF UHYLHZ DQG PHWD
DQDO\VLV%0-  ±
+XPDLGDQ 3 6WHQHU9LFWRULQ ( -XQH   3DLQ UHOLHI GXULQJ RRF\WH UHWULHYDO ZLWK D QHZ VKRUW
GXUDWLRQ HOHFWURDFXSXQFWXUH WHFKQLTXHDQ DOWHUQDWLYH WR FRQYHQWLRQDO DQDOJHVLF PHWKRGV
+XP5HSURG  ±
0RQDVK,9)ZHEVLWH V+LVWRU\RI,9)DUWLFOH
 )LUVW WHVW WXEH EDE\  ERUQ %%&
KWWSQHZVEEFFRXNRQWKLVGD\KLGDWHVVWRULHVMXO\QHZVLGBVWP
5HWULHYHG  7KHELUWKRIWKH ZRUOG V ILUVWWHVW WXEHEDE\ KDV EHHQ DQQRXQFHG LQ
0DQFKHVWHU (QJODQG /RXLVH%URZQZDVERUQVKRUWO\EHIRUHPLGQLJKWLQ2OGKDPDQG'LVWULFW
*HQHUDO+RVSLWDO
:RUOG V ILUVW WHVWWXEH EDE\ /RXLVH %URZQ KDV D FKLOG RI KHU RZQ ,QGHSHQGHQW
KWWSZZZLQGHSHQGHQWFRXNOLIHVW\OHKHDOWKDQGIDPLOLHVKHDOWKQHZVZRUOGVILUVWWHVWWXEH
EDE\ORXLVHEURZQKDVDFKLOGRIKHURZQKWPO 7KH \HDUROG ZKRVH SLRQHHULQJ
FRQFHSWLRQE\LQYLWURIHUWLOLVDWLRQPDGHKHUIDPRXVDURXQGWKHZRUOG7KHIHUWLOLW\VSHFLDOLVWV
3DWULFN6WHSWRHDQG%RE(GZDUGVEHFDPHWKHILUVWWRVXFFHVVIXOO\FDUU\RXW,9)E\H[WUDFWLQJ
DQHJJLPSUHJQDWLQJLWZLWKVSHUPDQGSODQWLQJWKHUHVXOWLQJHPEU\REDFNLQWRWKHPRWKHU
.\RQR.8WR+1DNDMR<.XPDJDL6$UDNL<.DQWR6  6HYHQSUHJQDQFLHVDQGGHOLYHULHV
IURP QRQPRVDLF .OLQHIHOWHU V\QGURPH SDWLHQWV XVLQJ IUHVK DQG IUR]HQ WHVWLFXODU VSHUP -
$VVLVW5HSURG*HQHW  ±
2NDGD + *RGD . 0XWR 6 0DUX\DPD 2 .RVKLGD 0 +RULH 6   )RXU SUHJQDQFLHV LQ
QRQPRVDLF.OLQHIHOWHU VV\QGURPHXVLQJFU\RSUHVHUYHGWKDZHGWHVWLFXODUVSHUPDWR]RD )HUWLO
6WHULO  
/DZVRQ'RPLQLF 0DUFK 2IFRXUVHDGHDIFRXSOHZDQWDGHDIFKLOG7KH,QGHSHQGHQW
KWWSZZZLQGHSHQGHQWFRXNRSLQLRQFRPPHQWDWRUVGRPLQLFODZVRQGRPLQLFODZVRQRI
FRXUVHDGHDIFRXSOHZDQWDGHDIFKLOGKWPO5HWULHYHG1RY
$SSHO-DFRE025( '(6,*1(5 237,2167KH:LQQLSHJ6XQ0DUFK
3DUNV -HQQLIHU $   $ FORVHU ORRN DW UHSURGXFWLYH WHFKQRORJ\ DQG SRVWPHQRSDXVDO
PRWKHUKRRG&0$-  ±
$FFHVVWRIHUWLOLW\WUHDWPHQWE\JD\VOHVELDQVDQGXQPDUULHGSHUVRQV7KH(WKLFV&RPPLWWHHRIWKH
$PHULFDQ6RFLHW\IRU5HSURGXFWLYH0HGLFLQH)HUWLOLW\DQG6WHULOLW\9ROXPH,VVXH3DJHV
HH  
$SSHO-0  0D\GRFWRUVUHIXVHLQIHUWLOLW\WUHDWPHQWVWRJD\SDWLHQWV"+DVWLQJV&HQW5HS
 ±
0'RODQ6WDWHKLJKFRXUWPD\JLYHJD\VDQRWKHUYLFWRU\/RV$QJHOHV7LPHV0D\

ϰϯϴ

0 'RODQ &DOLIRUQLD GRFWRUV FDQ W UHIXVH WUHDWPHQW WR JD\V RQ UHOLJLRXV JURXQGV FRXUW UXOHV /RV
$QJHOHV7LPHV$XJXVW
3RSH3DXO9,  +XPDQDH9LWDH(QF\FOLFDORI3RSH3DXO9,RQWKH5HJXODWLRQRI%LUWK
9DWLFDQ KWWSZZZYDWLFDQYDKRO\BIDWKHUSDXOBYLHQF\FOLFDOVGRFXPHQWVKIBS
YLBHQFBBKXPDQDHYLWDHBHQKWPO
+DPPRXG$2*LEVRQ06WDQIRUG-:KLWH*&DUUHOO'73HWHUVRQ0  ,QYLWURIHUWLOL]DWLRQ
DYDLODELOLW\DQGXWLOL]DWLRQLQWKH8QLWHG6WDWHVDVWXG\RIGHPRJUDSKLFVRFLDODQGHFRQRPLF
IDFWRUV)HUWLOLW\DQG6WHULOLW\  ±
&KDPEHUV*06XOOLYDQ($,VKLKDUD2&KDSPDQ0*$GDPVRQ*' -XQH  7KHHFRQRPLF
LPSDFWRIDVVLVWHGUHSURGXFWLYHWHFKQRORJ\ D UHYLHZRIVHOHFWHG GHYHORSHG FRXQWULHV )HUWLO
6WHULO  ±








%DOOLQJ 5   (18 PXWDJHQHVLV DQDO\]LQJ JHQH IXQFWLRQ LQ PLFH $QQX 5HY
*HQRPLFV+XP*HQHW±
%DUEDULF,HWDO  6SHFWUXPRI(18LQGXFHGPXWDWLRQVLQSKHQRW\SHGULYHQDQGJHQH
GULYHQVFUHHQVLQWKHPRXVH(QYLURQ0RO0XWDJHQ±
&KHQ < HW DO   *HQRW\SLQJEDVHG VFUHHQ IRU (18LQGXFHG PXWDWLRQV LQ PRXVH
HPEU\RQLFVWHPFHOOV1DW*HQHW±
GH)RXJHUROOHV$HWDO  ,QWHUIHULQJZLWKGLVHDVH D SURJUHVV UHSRUW RQ VL51$EDVHG
WKHUDSHXWLFV1DW5HY'UXJ'LVFRY±
'ULHVVHQ &$ HW DO   'LVUXSWLRQ RI WKH FLVUHWLQRO GHK\GURJHQDVH JHQH OHDGV WR
DFFXPXODWLRQRIFLVUHWLQROVDQGFLVUHWLQ\OHVWHUV0RO&HOO%LRO±
(QJZHUGD &5 HW DO   /RFDOO\ XSUHJXODWHG O\PSKRWR[LQ DOSKD QRW V\VWHPLF WXPRU
QHFURVLVIDFWRUDOSKDLVWKHSULQFLSOHPHGLDWRURIPXULQHFHUHEUDOPDODULD-([S0HG
±
)ULHGHO 5+ HWDO   *HQH WDUJHWLQJ XVLQJ D SURPRWHUOHVV JHQH WUDS YHFWRU µµWDUJHWHG
WUDSSLQJ¶¶ LVDQHIILFLHQWPHWKRGWRPXWDWHDODUJHIUDFWLRQRIJHQHV3URF1DWO$FDG
6FL86$±
+LWRWVXPDFKL 6 HW DO   'RVHUHSHWLWLRQ LQFUHDVHV WKH PXWDJHQLF HIIHFWLYHQHVV RI 1
HWK\O1QLWURVRXUHDLQPRXVHVSHUPDWRJRQLD3URF1DWO$FDG6FL86$±

-XVWLFH0-HWDO  0RXVH(18PXWDJHQHVLV+XP0RO*HQHW±
.QLJKW-&HWDO  $SRO\PRUSKLVPWKDWDIIHFWV2&7ELQGLQJWRWKH71)SURPRWHU
UHJLRQLVDVVRFLDWHGZLWKVHYHUHPDODULD1DW*HQHW±
/XFDV5HWDO  &UXFLDOUROHRIWXPRUQHFURVLVIDFWRU 71) UHFHSWRUDQGPHPEUDQH
ERXQG71)LQH[SHULPHQWDOFHUHEUDOPDODULD(XU-,PPXQRO±
/XFDV5HWDO  5HVSHFWLYHUROHRI71)UHFHSWRUVLQWKHGHYHORSPHQWRIH[SHULPHQWDO
FHUHEUDOPDODULD-1HXURLPPXQRO±
0DWVXGD,DQG$LED$  5HFHSWRUNQRFNRXWDQGNQRFNLQVWUDWHJLHV0HWKRGV0RO
%LRO±
6DNXUDED < HW DO   0ROHFXODU FKDUDFWHUL]DWLRQ RI (18 PRXVH PXWDJHQHVLV DQG
DUFKLYHV%LRFKHP%LRSK\V5HV&RPPXQ±
6WDQIRUG:/HWDO  *HQHWUDSSLQJLQHPEU\RQLFVWHPFHOOV0HWKRGV(Q]\PRO
±

ϰϯϵ

7DQLJXFKL7HWDO  )DLOXUHRIJHUPLQDOFHQWHUIRUPDWLRQDQGLPSDLUPHQWRIUHVSRQVH
WRHQGRWR[LQLQWXPRUQHFURVLVIDFWRUDOSKDGHILFLHQWPLFH/DE,QYHVW±


ϰϰϬ

Buy your books fast and straightforward online - at one of world’s
fastest growing online book stores! Environmentally sound due to
Print-on-Demand technologies.
Buy your books online at
www.morebooks.shop
Kaufen Sie Ihre Bücher schnell und unkompliziert online – auf einer
der am schnellsten wachsenden Buchhandelsplattformen weltweit!
Dank Print-On-Demand umwelt- und ressourcenschonend produzi
ert.
Bücher schneller online kaufen
www.morebooks.shop
KS OmniScriptum Publishing
Brivibas gatve 197
LV-1039 Riga, Latvia [email protected]
Telefax: +371 686 204 55 www.omniscriptum.com