We recognize that the environmental challenges presented by climate change require an urgent response from businesses, government and individuals around the world.

While global energy demands continue to grow, Fairmount Minerals is committed to reducing our own energy consumption, employing alternative energy, and educating the Fairmount Minerals family on the importance of reducing our carbon footprint.

Energy Conservation

In 2009, we focused on energy efficiency and cost-savings projects to help meet our environmental goals. Technology upgrades, including a laptop and desktop computer replacement plan, resulted in more than $39,000 in energy savings. We consolidated several servers to operate via a virtual network that is more energy efficient than traditional set-ups and eliminates the need for on-site cooling systems. Our Eco-Efficiency Team also formalized a high efficiency motor replacement plan that ensures any new motor purchase will meet specific criteria for energy efficiency.

At the individual facility level, energy audits and special technology investments helped to uncover new opportunities for energy reductions. At our facility in Bridgman, Michigan, we conducted an energy audit in which we inventoried and began replacing dated lighting systems. In Ottawa, Illinois, employees at our Mineral Visions operation introduced a new technology that uses magnets to clean sand, eliminating the energy and water used for washing and drying.

We also made significant progress in reducing energy consumption through several heat recovery projects. With the thermal oxidizer technology we introduced at three Fairmount facilities in recent years, we identified an opportunity to capture waste heat. The heat is redirected and reintroduced into our processes, allowing facilities to reduce the natural gas energy that we typically use for processing. We plan to expand heat recovery projects throughout 2010.

In keeping with our goals to reduce the environmental impacts associated with transporting goods and materials, we worked to improve energy efficiency in our inbound and outbound logistics. We maximized load weights at targeted facilities to increase the amount of product we hauled in each trip. This reduced our total number of truck and train loads, which translates into reduced total fuel consumption. We estimate the savings from this effort to reach $600,000. Additionally, our Transportation Team developed a system to triangulate transportation routes to minimize empty hauls and increase the efficiency of our logistics.

Alternative Energy

Renewable and alternative energy projects continue to be a priority for Fairmount Minerals. In 2009, we identified solar energy as a viable energy alternative and started work on a solar array installation at our facility in Chardon, Ohio. The array will supply up to 30 percent of our office energy needs and will be completed in early 2010. We also finalized a wind energy analysis at our Wedron Sand facility. Unfortunately, our Wedron facility would not produce the amount of wind energy needed to support investment in a wind turbine installation. We plan to continue searching for wind energy opportunities and expand our solar energy efforts to other facilities.

Carbon Footprint

Reducing our carbon footprint is the primary objective of Fairmount Minerals’ conservation and alternative energy projects. We successfully reduced our greenhouse gas emissions by approximately 1.6 percent in 2009 over a 2006 baseline. Our goal of a 2.5 percent reduction in normalized greenhouse gas emissions proved difficult to meet this year due to reduced production levels. We see opportunity to improve our energy efficiency and carbon footprint across all operations in the future, so we plan to reduce current greenhouse gas emission levels by 10 percent by 2015.

Fairmount Minerals commits to offsetting our greenhouse gas emissions through carbon sequestration. We sequestered nearly 90 percent of our greenhouse gas emissions in 2009 by planting more than 48,500 trees and approximately 55 acres of native grasses.

We report greenhouse gas emissions in the form of carbon dioxide (CO2) equivalents, which are calculated from fuel and electricity consumption using emissions factors from the U.S. Environmental Protection Agency (USEPA) eGRID database, USEPA emission factors from AP-42 (5th edition, Compilation of Air Pollutant Emission Factors, Volume 1: Stationary Point and Area Sources), the FIRE (Factor Information Retrieval System) database, the Revised 1996 IPCC Guidelines and the World Resources Institute/World Business Council for Sustainable Development GHG Protocol.