54
0RGHOOLQJ1HZVOHWWHU1XPEHU±6SULQJ :HOFRPH ,QIR:RUNV672$7 277(55HIHUHQFHV 7UDLQLQJ 6RIWZDUH8VHU'D\ ,:$$FWLYDWHG6OXGJH0RGHOOLQJ6HPLQDU6HSWHPEHU 7\SLFDOYDOXHVIRUZDVWHZDWHUV 4XHVWLRQVDQGDQVZHUV ([SHULHQFHDQGH[WHQVLRQVWRWKH$60IDPLO\RIPRGHOV 0RGHOOLQJWKH3HUIRUPDQFHRI&DUERQDFHRXV%LRORJLFDO$HUDWHG)LOWHUV%$)V8VLQJ672$7 (YDOXDWLRQRI%URXZHU¶VUHVSLURPHWU\EDVHGDFWLYDWHGVOXGJHFRQWUROVWUDWHJ\ 3URFHVVPRGHOOLQJRIDQ2UEDO::73XVLQJ672$7DVHQVLWLYLW\DQDO\VLV

Newsletter Number 6

Embed Size (px)

DESCRIPTION

STOAT

Citation preview

  • 0RGHOOLQJ1HZVOHWWHU1XPEHU6SULQJ:HOFRPH,QIR:RUNV672$7 277(55HIHUHQFHV 7UDLQLQJ6RIWZDUH8VHU'D\,:$$FWLYDWHG6OXGJH0RGHOOLQJ6HPLQDU6HSWHPEHU7\SLFDOYDOXHVIRUZDVWHZDWHUV4XHVWLRQVDQGDQVZHUV ([SHULHQFHDQGH[WHQVLRQVWRWKH$60IDPLO\RIPRGHOV 0RGHOOLQJWKH3HUIRUPDQFHRI&DUERQDFHRXV%LRORJLFDO$HUDWHG)LOWHUV%$)V8VLQJ672$7 (YDOXDWLRQRI%URXZHUVUHVSLURPHWU\EDVHGDFWLYDWHGVOXGJHFRQWUROVWUDWHJ\3URFHVVPRGHOOLQJRIDQ2UEDO::73XVLQJ672$7DVHQVLWLYLW\DQDO\VLV

  •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

    *OHQQ'LOORQ*$&0DQ 0DUN6PLWK'LUHFWRURI6RIWZDUH /L]3DOIUH\6RIWZDUHSURJUDPPH0DQDJHU &KHU\O)XONHU6RIWZDUH&RRUGLQDWRU

    *RUGRQ'HYLQH6RIWZDUH0DQDJHU $QGUHZ/RQQHQ6RIWZDUHGHYHORSHU .LUVWLH+HDUQ0RGHOOHU -HUHP\'XGOH\6RIWZDUH'HYHORSHU

  • ,QIR:RUNV672$7:DOOLQJIRUG6RIWZDUHVSRSXODULQIRUPDWLRQKDQGOLQJSDFNDJH,QIR:RUNVKDVORQJEHHQDKRPHIRUWKHLUVHZHUPRGHOOLQJV\VWHP+\GUR:RUNV,QIR:RUNVKDVEHHQJURZLQJRYHUWKH\HDUVILUVWZLWKWKHDGGLWLRQRIWKHMRLQW:DOOLQJIRUG6RIWZDUH+DOFURZVULYHUPRGHO,6,6WKHQZLWKWKHDGGLWLRQRIZDWHUGLVWULEXWLRQQHWZRUNVRIWZDUHVXFKDV:5FV:$71(7DQGQRZZLWKWKHDGGLWLRQRI672$7)URPWKHHDUO\GD\VRIWKH8.V8UEDQ3ROOXWLRQ0DQDJHPHQWSURJUDPPH672$7KDVVXSSRUWHGWKHFRPPRQ830WRROVWKHQ0264,72DQGVLQFHWKHQ+\GUR:RUNV1RZ672$7XQGHUVWDQGV,QIR:RUNVGDWDILOHVSURGXFHGE\+\GUR:RUNVDQGFDQDOVRSURGXFHILOHVWKDWFDQEHUHDGLQWR,QIR:RUNV,QIR:RUNVFDQDOVREHXVHGDVDFRQWUROSDQHOZLWKZKLFKWRODXQFK672$7DQGSURYLGHDJUHDWHUGHJUHHRILQWHJUDWLRQIRUFDWFKPHQWZLGHPRGHOOLQJ277(55HIHUHQFHV:HKDYHEHHQDVNHGIRUQRQ:5FVRXUFHVRISXEOLFDWLRQVDERXW277(57KHOLVWEHORZLVWKRVHZHKDYHEHHQJLYHQPDLQO\XQLYHUVLW\XVDJHRI277(5277(5XVHGWREHFDOOHG:($6(/EXWKDGDFKDQJHRIQDPHLQ9$9)RUVN6ZHGHQLQ6ZHGLVKSDJH(QJOLVKVXPPDU\3URFHVVPRGHOOI|UYDWWHQYHUN7LOOlPSQLQJDY :HDVHOSn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
  • 6RIWZDUH8VHU'D\:HRUJDQLVHGDXVHUGD\DW6ZLQGRQKHOGRQWKHWK 0D\:HKDYHHPDLOHGRXWPLQXWHVDQGSUHVHQWDWLRQVWRDOOWKRVHSHRSOHIRUZKRPZHKDYHDQHPDLODGGUHVV,I\RXZRXOGOLNHWKHSUHVHQWDWLRQPDWHULDOSOHDVHHPDLOXVDWVWRDW#ZUFSOFFRXN7KHPLQXWHVRIWKHPHHWLQJDUHJLYHQEHORZ,DQ:DONHU:5FV%XVLQHVV'LUHFWRUZHOFRPHGDWWHQGHHVWRWKHXVHUGD\DQGSURYLGHGDEDFNJURXQGWR:5FV8WLOLWLHV%XVLQHVVDQGWKHFRRUGLQDWLRQRIWKHVRIWZDUHEXVLQHVVLQWRRQHEXVLQHVVDUHDLQUHFRJQLWLRQRILWVFDSDELOLWLHVDQGLPSRUWDQFH-HUHP\'XGOH\:5F5HFHQW672$7DQG3ODQ,W672$78VDJH

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

  •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x ,WZDVHDVLHUWRH[SRUWPRGHOVUXQVx &RXOGPRGHOIRU*$&LQUDSLGJUDYLW\ILOWHUVx &RXOGPRGHOIRUSXOVDWRUFODULILHUx &RXOGPRGHOIRUR]RQHVWDWLFPL[HUx &RXOGPRGHOIRUUHVHUYRLUVx ,WLVDWWKHIRUHIURQWRIWUHDWPHQWWHFKQRORJ\DQGSURFHVVHVZKLFKDUHRUGLQDU\DQGQRUPDODUHQRWLQWKHPRGHO

    Three Valleys future plans for OTTER are to:x %XLOGDFFXUDWHPRGHOVRI:7:Vx *LYHPRGHOVWRWHFKQLFLDQVDQGRWKHUVVRWKDWLWLVQRWMXVWDQ5'WRROx 7UDLQWHFKQLFLDQVDQGRWKHUVWRXVHWKHVRIWZDUHx $QGDOVRWRDFTXLUHWKHGDWDConclusionsx ,WGRHVQWWUDLQQHZWHFKQLFLDQVDQGSHUKDSVWKLVZDVDQDwYHH[SHFWDWLRQ"x ,WKDVORWVRISRWHQWLDOx $OOXVHUVKRZHYHUQHHGDWUDLQLQJUHJLPHDVSDUWRIWKHSDFNDJHx 7KHPRGHOVQHHGWREHXVHGZLWKLQOLPLWVZKLFKQHHGWREHFOHDUO\GHVFULEHGx %XLOGLQJDFFXUDWHPRGHOVWDNHVWLPHIURPDWUDLQHGHQJLQHHU'DYLG)RUWXQH:DOOLQJIRUG6RIWZDUH8VHRI672$7DQG,QIR:RUNV

    ,QIR:RUNVLV:DOOLQJIRUG6RIWZDUHVPDLQSURGXFWDQGLWSXOOVRXWWKHEHVWLGHDVIURPDUDQJHRIVLPXODWLRQVRIWZDUH:DOOLQJIRUGDQG:5FKDYHFRPSOLPHQWDU\VNLOOVDQGH[SHULHQFHKHQFHWKHOLQNVEHWZHHQ:DOOLQJIRUGDQG:5F7KHLQWHJUDWLRQRI672$7DQG,QIR:RUNVDOORZVVHZHUV\VWHPVVXSSO\LQJZDVWHZDWHUZRUNVDVZHOODVULYHUV\VWHPVWREHPRGHOOHG7KHLQLWLDOLQWHJUDWLRQRI,QIR:RUNVDQG672$7LVPDGHE\ILOHVZDSSLQJ6HZHUPRGHOOLQJDQGVHZHUWUHDWPHQWZRUNLQJWRJHWKHU*UHDWHULQWHJUDWLRQRI672$7DQGSRWHQWLDOO\277(5FRXOGKDSSHQLWGHSHQGVRQWKHXVHUVDQGZKDWWKH\ZDQWIURPWKHVRIWZDUH,:$$FWLYDWHG6OXGJH0RGHOOLQJ6HPLQDU6HSWHPEHU7KLVLVWKHODWHVWLQWKH.ROOHNROOHVHPLQDUV,WZDVSRRUO\DWWHQGHGFRPSDUHGWRSUHYLRXVVHPLQDUVSRVVLEO\EHFDXVHWKLVGLGQRWVHHWKHODXQFKRIDQHZDFWLYDWHGVOXGJHPRGHO7KHVHPLQDUODXQFKHG$60DQGWKHVHPLQDU$60GDQG$607KHLQWHQGHGIRFXVRIWKLVVHPLQDUZDVH[SHULHQFHZLWKXVLQJ$60EXWPRVWRIWKHSDSHUVZHUHORRNLQJDWH[SHULHQFHZLWK$60DQG$60G7KHVHPLQDUZDVKHOGRYHUWKUHHGD\V6HSWHPEHUDQGWKHILQDOGD\ZDVUDWKHUVXEGXHGEHFDXVHRIWKHHYHQWVRIWKHSUHFHGLQJGD\

  •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

    %2'%2'W

    I%2'%&2'W.%2'%2'

    ff

    H[S ZKHUHI%2' FRUUHFWVIRUWKHXSWDNH

    RIELRGHJUDGDEOH&2'DQGLWVFRQYHUVLRQLQWRDQRQGHJUDGDEOHIRUPKHQFHDQDSSDUHQWUHGXFWLRQLQWKHWUXHGHJUDGDEOHPDWHULDO)%2'KDVEHHQIRXQGWREHLQWKHUDQJHDQGGHIDXOWRILVUHFRPPHQGHG7KHVXEVHTXHQWFDOFXODWLRQSURFHGXUHLVJLYHQLQWKHIROORZLQJWDEOH

  • 6HJUHJDWHGYHUVXVGLVWULEXWHGELRPDVVPRGHOVLQDFWLYDWHGVOXGJHV\VWHPV:*XMHU:LOOLORRNHGDWZKDWZRXOGKDSSHQLIZHDWWHPSWHGWRPRGHOWKHEDFWHULDDVLQGLYLGXDOVUDWKHUWKDQDVDKRPRJHQRXVOXPSHGPDVV+HORRNHGDWWZRFDVHVD SOXJIORZUHDFWRULQZKLFKWKHSUREDELOLW\RIDFHOOOHDYLQJDQ\JLYHQVWDJHZDVDIXQFWLRQRIWKHUHWHQWLRQWLPHDQGD6%5LQZKLFKKHDVVXPHGWKDWWKHVOXGJHVZHUHUHPRYHGDOOZLWKSUREDELOLW\:LWKWKHVHDVVXPSWLRQVKHVKRZHGWKDW6%5V\VWHPV

  •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
  •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

    'LOXWHGYDOXHV%2' $78PJO6ROXEOH%2' $78PJO7RWDO&2'6,7KHVHDEEUHYLDWLRQV6,66HWFDUHFRPPRQLQWKHPRGHOOLQJOLWHUDWXUH;,6$66)RU$60)RU$6066 DVWKH9)$HOHPHQW6$LVLQFOXGHGLQ66;6;+LQFOXGHGLQ;6;$LQFOXGHGLQ;67RWDOQLWURJHQ$PPRQLDFDOQLWURJHQ2[LGLVHGQLWURJHQ2UJDQLFQLWURJHQ

    +HQ]H+DUUHPRHVOD&RXU -HQVHQDQG$UYLQ:DVWHZDWHU7UHDWPHQW6SULQJHU 9HUODJQG HGQ

  •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

    '2UKRQDQG1$UWDQ0RGHOOLQJRIDFWLYDWHGVOXGJHV\VWHPV7HFKQRPLF3UHVV,6%1

    4$

  • ([SHULHQFHDQGH[WHQVLRQVWRWKH$60IDPLO\RIPRGHOV-'XGOH\*%XFN5$VKOH\

    DQG$-DFN

    :5F)UDQNODQG5RDG6ZLQGRQ61

  •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

    7DEOH 6LWH'HWDLOV$HUDWLRQWDQN 6HWWOHU9ROXPHP 6XUIDFHDUHDP$QDHURELFIUDFWLRQ 'HSWKP$QR[LFIUDFWLRQ 5$6IORZPK1LWUDWHUHF\FOHPK :$6IORZPK$QR[LFUHF\FOHPK0/66FPJO$YHUDJHVHWWOHGVHZDJH)ORZPK&2'PJO766PJO$PPRQLDPJO3KRVSKRUXVPJO$QH[LVWLQJPRGHOZDVDYDLODEOHEDVHGRQ$60DQGWKHNLQHWLFSDUDPHWHUVXVHGIRUWKDWPRGHOFDOLEUDWHGE\WKHVLWHVWDIIZHUHXVHGLQWKH$60PRGHO7KH$60PRGHOZDVFDOLEUDWHGRQO\IRUWKHELRORJLFDOSKRVSKRUXVUHPRYDODQGIRUWKHVROLGVHWWOLQJSURSHUWLHV

    02'(/&$/,%5$7,217KHPRGHOZDVFDOLEUDWHGE\H\HDGMXVWLQJWKHSDUDPHWHUVXQWLODEHVWILWZDVMXGJHGWRKDYHEHHQIRXQG7KLVSURFHGXUHKDVEHHQXVHGVXFFHVVIXOO\LQWKHSDVW7KHUHDVRQVIRUWKLVFRPSDUHGWRPRUHIRUPDOSURFHGXUHVVXFKDVOHDVWVTXDUHVDVVHVVPHQWVDUHx :KHUHOLWWOHLVNQRZQDERXWWKHXQGHUO\LQJHUURUGLVWULEXWLRQLQWKHGDWDWKHQJUDSKLFDOILWVDUHPRUHUREXVWx 2XWOLHUVDUHPRUHUHDGLO\KDQGOHGWKURXJKJUDSKLFDOFRPSDULVRQx &XWRIIGDWDHJDPPRQLDGDWDUHFRUGHGRQO\DVPJOLVEHWWHUKDQGOHGWKURXJKJUDSKLFDOFRPSDULVRQV7KHUHVXOWLQJVHWRISDUDPHWHUVLVJLYHQLQ7DEOH2QO\WKHLWDOLFLVHGLWHPVZHUHFDOLEUDWHGIRUELRORJLFDOSKRVSKRUXVUHPRYDOWKHRWKHUSDUDPHWHUVZHUHFDOLEUDWHGLQSUHYLRXV\HDUVIRUSUHYLRXVPRGHOVXVHGE\WKHSODQWEDVHGRQ$607ZRYDOXHVDUHJLYHQIRUWKHDXWRWURSKJURZWKUDWHDVWKHSUDFWLFHDWWKH

  •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

  • -DQ -DQ 0DU $SU 0D\ -XQ -XO $XJ 6HS 2FW 1RY 'HF 'HF

    Nnita

    rte (m

    g/l)it

    rate

    (mg/

    l(ModelData

    )LJXUH (IIOXHQWQLWUDWH

    -DQ -DQ 0DU $SU 0D\ -XQ -XO $XJ 6HS 2FW 1RY 'HF 'HF

    ModelData

    Amm

    oni

    a (m

    g/l)

    )LJXUH (IIOXHQWDPPRQLD)RUSKRVSKRUXVWKHPRGHOOLQJUHVXOWVDUHQRWTXLWHDVJRRGDVFDQEH VHHQLQ)LJXUH+RZHYHULWLVFOHDUWKDWWKHPRGHOLVUHSUHVHQWLQJWKHEDVLFVRIWKHG\QDPLFVLQWKHUHVSRQVHLQGLFDWLQJZKHQWKHUHDUHSHULRGVRIKLJKSKRVSKRUXVLQWKHHIIOXHQW:HDVVXPHWKDWDFFXUDWHPRGHOOLQJRISKRVSKRUXVLVPRUHVHQVLWLYHWRLQDGHTXDFLHVLQWKHGDWDVHWWKDQLVWKHFDVHZLWKQLWURJHQEXWWKDWWKHPRGHOZLOOJLYHUHDVRQDEOHZDUQLQJRIOLNHO\SUREOHPSHULRGV

  • -DQ -DQ 0DU $SU 0D\ -XQ -XO $XJ 6HS 2FW 1RY 'HF

    (IIOXHQWWR

    WDOSKRVSK

    RUXVPJO

    0HDVXUHG0RGHO

    )LJXUH (IIOXHQWWRWDOSKRVSKRUXV7KHPRGHOZDVUHDVRQDEO\FDOLEUDWHGE\LQFUHDVLQJWKHDQR[LFDQGDQDHURELFK\GURO\VLVUDWHVZKLFKE\GHIDXOWDUHDQGRIWKHDHURELFYDOXHV8VLQJYDOXHVWKDWZHUHRIWKHDHURELFYDOXHVSURGXFHGDODUJHLPSURYHPHQWLQWKHPRGHOSUHGLFWLRQV7KHUHZDVIXUWKHUVPDOOHULPSURYHPHQWLQLQFUHDVLQJWKH3+$XSWDNHUDWHIURPGWRGDWR&7KLVLVLQOLQHZLWKWKHILQGLQJVRI/DUUHDHWDO2WKHUSDUDPHWHUVWULHGEXWZLWKOLWWOHHIIHFWZHUHx )HUPHQWDWLRQUDWH7KLVKDGOLWWOHHIIHFWEHFDXVHWKHUDWHOLPLWLQJVWHSZDVK\GURO\VLVRISDUWLFXODWH&2'WRIHUPHQWDEOH&2'RU WKHSURYLVLRQRIVXIILFLHQWTXDQWLWLHVRISDUWLFXODWH&2'x +LJKKHWHURWURSKLFGHDWKUDWHVWRUHOHDVH&2'LQWRWKHDQDHURELF]RQH:KLOHWKLVZRUNHGWKHOHYHOVUHTXLUHGZHUHPXFKWRRKLJKDURXQGWLPHVWKHGHIDXOWYDOXHVx +LJKSRO\SKRVSKDWHVWRUDJHFRQFHQWUDWLRQV7KLVSURGXFHGWKHEHVWUHVXOWVEXWUHTXLUHGWKDWWKHELRPDVVFRPSULVHDERXWQRQYRODWLOHVROLGVFRPSDUHGWRDPRUHFRPPRQYDOXHRIDURXQGx +LJKJURZWKUDWHVRI3$2EDFWHULD7KLVKDGOLWWOHHIIHFWEHFDXVHRIOLPLWDWLRQVLQDYDLODEOH&2'IRUJURZWK

  • $VLVFRPPRQ0/66LVXVXDOO\ZHOOUHSUHVHQWHG7KHJUHDWHUOHYHORIGHWDLOJLYHQWRUHSUHVHQWLQJWRWDOVROLGVLQ$60KDVPDGHPDWFKLQJ0/66HDVLHUWKDQZDVWKHFDVHZLWK$60 WKLVKDVEHHQRXUH[SHULHQFHZLWKRWKHUVLWHVDVZHOO

    -DQ -DQ 0DU $SU 0D\ -XQ -XO $XJ 6HS 2FW 1RY 'HF 'HF

    'DWD7RWDO66PJO

    0/66PJO

    )LJXUH 0/66,16(:(56725$*(6

  •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

  •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

    'LVWDQFHP

    9)$FRQF

    HQWUDWLRQ

    PJ&2'O

    )LJXUH 3URGXFWLRQDQGFRQVXPSWLRQRI9)$VLQDVHZHU:KHQWKHVWRUDJHZDVFRQVLGHUHGDVEHLQJDOPRVWQH[WWRWKHVHZDJHZRUNVWKHQODUJHUTXDQWLWLHVRI9)$VDQGK\GURJHQVXOSKLGHZHUHSUHVHQWDWWKHVHZDJHZRUNVLQOHWEXWVWLOODWFRQFHQWUDWLRQVORZHQRXJKWKDWWKH\ZHUHQRWDQLVVXH$VDQH[DPSOHWKHVXPPDU\UHVXOWVIRUDFRPSDULVRQEHWZHHQUXQQLQJZLWK9)$VSUHVHQWLQWKHLQIOXHQWDQGZLWKWKH9)$VVXEVXPHGLQWRWKHIHUPHQWDEOHVXEVWUDWHDUHJLYHQLQ7DEOH

    7DEOH (IIOXHQWTXDOLW\LPSDFWRI9)$VLQWKHLQIOXHQW:LWK9)$V :LWKRXW9)$V766 &2' 1+ 766 &2' 1+0HDQ 0LQLPXP 0D[LPXP 6WDQGDUG 7KHDQDO\VLVDVVXPHGWKDWWKHVWRUDJHZDVSURYLGHGLQOLQHWKDWLVDVSDUWRIWKHPDLQVHZHUIORZ2IIOLQHVWRUDJHZKHUH WKH IORZ LVGLYHUWHG WRD VHSDUDWHKROGLQJ WDQNPD\SRWHQWLDOO\ KDYH VHZDJH VWDQGLQJ IRUORQJHUSURGXFLQJPRUH9)$VDQGPD\DGMXVWVOLJKWO\WKHFRQFOXVLRQVUHDFKHGKHUH7KHUHZRXOGVWLOOEHDUDSLGFRQVXPSWLRQRI9)$VDQGK\GURJHQVXOSKLGHDIWHUGLVFKDUJHSURYLGHG WKDWVRPHSDUWRI WKH VHZHUZDVDHURELFVRWKDWWKHJHQHUDOFRQFOXVLRQWKDW9)$VSURGXFHGWKURXJKDQDHURELFVWRUDJHFRQGLWLRQVDUHXVXDOO\WUHDWHGE\WKHVHZHUV\VWHPLWVHOILVSUREDEO\VWLOOYDOLG

  •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x 2SHUDWLQJZLWKIORZSURSRUWLRQDO5$6JHQHUDOO\SURGXFHGJRRGUHVXOWV)RURQHVHWRIRSHUDWLQJFRQGLWLRQVDQGVWRUPIORZVKRZHYHUWKLVSURGXFHGDZRUVHHIIOXHQWTXDOLW\WKDQRSHUDWLQJDWDIL[HG5$6IORZUDWHx 6WHSIHHGZDVDYLDEOHVROXWLRQDQGGLGQRWDIIHFWWKHDPPRQLDYDOXHVPXFKSUREDEO\EHFDXVHRIWKHGLOXWLRQRIWKHDPPRQLDLQWKHLQIOXHQWGXULQJWKHVWRUPSHULRGV7KHUHVXOWVDUHVLPLODUWRWKRVHRI&KHQDQG%HFN7KH\IRXQGWKDWVWHSIHHGSURGXFHGEHWWHUHIIOXHQWTXDOLW\WKDQIORZSURSRUWLRQDO5$6ZKHQORRNLQJDW766DQG&2'EXWZRUVHZKHQORRNLQJDWDPPRQLD7KHFRPSDUDWLYHUHVXOWVIURPRXUPRGHOOLQJH[HUFLVHDUHJLYHQLQ7DEOHx 5XQQLQJDWDKLJKHU'2VHWSRLQWGLGQRWKDYHPXFKHIIHFWx %\SDVVLQJWKHSULPDU\WDQNVGXULQJVWRUPVRUKDYLQJDVWRUPRYHUIORZDIWHUWKHSULPDU\WDQNVVRWKDWDOO VWRUPIORZVZHQWWKURXJKWKHSULPDU\WDQNVGLGQRWKDYHPXFKHIIHFWx +DYLQJDVDFULILFLDOODQHWRKDQGOHDODUJHVKDUHRIWKHVWRUPIORZGLGQRWSURGXFHDQ\VLJQLILFDQWLPSURYHPHQWLQHLWKHUHIIOXHQWTXDOLW\RUUHFRYHU\WLPHIROORZLQJWKHHQGRIWKHVWRUPx 0RGHOOLQJVLQJOHVWRUPHYHQWVGLGQRWVWUHVVWKHPRGHOOHGZRUNVDVPXFKDVKDYLQJDVHTXHQFHRIVWRUPV$OWKRXJKWKHHIIOXHQWTXDOLW\LQGLFDWHGDTXLFNUHWXUQWRQRUPDORSHUDWLRQDIWHUWKHILUVWVWRUPHYHQWWKHUHZDVVWLOOGLVWXUEDQFHRIWKHLQWHUQDOVWDWHV%HFDXVHRIWKLVDVHFRQGVWRUPHYHQWIROORZLQJLQTXLFNVXFFHVVLRQSURGXFHGDODUJHUHIIHFWRQHIIOXHQWTXDOLW\WKDQWKHILUVW7KHVWRUPHYHQWVEHLQJXVHGZHUHWDNHQIURPDSDUWLFXODUO\ZHWSHULRGIRUWKHFDWFKPHQWDUHDEHLQJXVHGx $WULFNOLQJILOWHUPRGHOZDVDOVRXVHG$OWKRXJKWKLVGLGQRWSURGXFHDVJRRGDQHIIOXHQWTXDOLW\DVWKHDFWLYDWHGVOXGJHV\VWHPVVRPHWKLQJZKLFKFDQEHDGGUHVVHGE\FKDQJLQJWKHILOWHUEHGDUHDGHSWKRUSDFNLQJFKDUDFWHULVWLFVWKHUHZDVYHU\OLWWOHHIIHFWRIWKHGLIIHUHQWVWRUDJHVFHQDULRVRQHIIOXHQWTXDOLW\XQOLNHWKHDFWLYDWHGVOXGJHV\VWHP7KHILOWHUV\VWHPDSSHDUVWREHUREXVWWRK\GUDXOLFXSVHWVPRUHVRWKDQDFWLYDWHGVOXGJHV\VWHPV

    7DEOH 3HUIRUPDQFHZLWKYDULDEOH5$6DQGVWHSIHHG9DULDEOH5$6 6WHSIHHG766 &2' 1+ 766 &2' 1+0HDQ 0LQLPXP 0D[LPXP 6WDQGDUGGHYLDWLRQ

    6WHS IHHG UHGXFHV WKH DHUDWLRQ YROXPH DYDLODEOH IRU QLWULILFDWLRQ DQG WKLV UHGXFWLRQ FDQ OHDG WR UHGXFHGQLWULILFDWLRQ

  •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

  •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

  •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

  •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

  •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x ,QWHUSRODWLRQIRUWKHPLVVLQJGDWDZDVXQGHUWDNHQLQRUGHUWRJLYHDFRQWLQXRXV&2'DQG66SURILOHVx $OOWKH&2'SUHVHQWLQWKHLQIOXHQWZDVELRGHJUDGDEOHx 7KHYRODWLOHVROLGVFRQVWLWXWHRIWKHWRWDOVXVSHQGHGVROLGVx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

  •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

    /.6 X.5 6 HPW W

  •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

  • FKDQJHVWRWKHDWWDFKPHQWFRHIILFLHQWZHUHXVHGVRDVWRJHWDEHWWHUVXVSHQGHGVROLGVILW7KHFKDQJHVPDGHWRWKHFDOLEUDWLRQSDUDPHWHUVDUHVKRZQLQ7DEOH7KHVROXEOH&2'UHVXOWVZHUHYHU\JRRGWKXVFRQILUPLQJWKHHIILFLHQF\RI672$7IRUWKHSUHGLFWLRQRIRXWOHWVROXEOH&2'FRQFHQWUDWLRQV,WLVZRUWKZKLOHQRWLQJKHUHWKDW672$7FDQJLYHDJRRGFRUUHODWLRQEHWZHHQDFWXDODQGVLPXODWHGVROXEOH&2'GDWDIRU%$)VWUHDWLQJKLJKVWUHQJWKZDVWHZDWHUVDQGDFKLHYLQJDORZVROXEOH&2'UHPRYDOUDWHV7KHIORDWLQJEHG6LPXODWLRQRIWKHILUVWRUJDQLFORDGLQJUDWHGDWDVKRZHGWKDWWKHPRGHOJDYHJRRGUHVXOWVIRUVROXEOH&2'$IWHUWZRPRQWKVRIVLPXODWLRQWKHPRGHOVWDUWHGWRRYHUSUHGLFWWKHRXWOHWVROXEOH&2'WKHQEHJDQWRXQGHUSUHGLFWDQGHYHQWXDOO\LWVWRSSHGJLYLQJDQHUURUPHVVDJHUHODWHGWRWKHVWLIIQHVVRIWKHGLIIHUHQWLDOHTXDWLRQV9DULRXVPRGLILFDWLRQVWRWKHFDOLEUDWLRQFRHIILFLHQWVZHUHLQWURGXFHGEXWWKHEHVWILWZDVREWDLQHGE\DGMXVWLQJWKHR[\JHQKDOIVDWXUDWLRQFRHIILFLHQWWRDQGORZHULQJWKHPDVVWUDQVIHUILOPHQKDQFHPHQWWR)LJXUH7KHVLPXODWHGVXVSHQGHGVROLGVH[KLELWHGVRPHIOXFWXDWLRQEXWJHQHUDOO\LWLQFUHDVHGFRQVWDQWO\6LPXODWLRQRIWKHSHUIRUPDQFHRIWKHIORDWLQJ%$)GXULQJWKHVHFRQGDQGWKHWKLUGRUJDQLFORDGLQJUDWHVXVLQJWKHFDOLEUDWHGPRGHOJDYHEHWWHUFRUUHODWLRQEHWZHHQWKHDFWXDODQGWKHSUHGLFWHGVROXEOH&2'UHVXOWV)RUWKHVHFRQGRUJDQLFORDGLQJUDWHPRGLILFDWLRQVWRWKHPDVVWUDQVIHUILOPHQKDQFHPHQWIURPWRZHUHQHFHVVDU\LQRUGHUWRREWDLQORZHUVROXEOH&2'FRQFHQWUDWLRQVLQWKHHIIOXHQW7KHFDOLEUDWHGPRGHOSUHGLFWHGWKHUHPRYDORIVROXEOH&2'GXULQJWKHWKLUGRUJDQLFORDGLQJUDWHYHU\HIILFLHQWO\WKXVFRQILUPLQJWKHDELOLW\RI672$7WRPRGHOWKHSHUIRUPDQFHRI%$)VWUHDWLQJFRQFHQWUDWHGZDVWHVDQGDFKLHYLQJORZHUUHPRYDOHIILFLHQFLHV)LJXUHVDQG7KHFKDQJHVPDGHWRWKHFDOLEUDWLRQSDUDPHWHUVDUHVKRZQLQ7DEOH/DUJHVFDOH%$)SHUIRUPDQFHPRGHOOLQJ)RUWKHODUJHVFDOH%$)WKHGHIDXOWYDOXHVZHUHXVHGWRUXQWKHPRGHODQGWKHUHVXOWVDUHSUHVHQWHGLQ)LJXUH8VLQJVWDJHVIRUWKHSDFNHGVHFWLRQUHVXOWHGLQWKHUXQEHLQJH[WUHPHO\VORZZKHUHRQHGD\RIRSHUDWLRQWRRNWZHQW\IRXUKRXUVWREHVLPXODWHG/RZHULQJWKHQXPEHURIVWDJHVWRWZRSURGXFHGPRUHRUOHVVVLPLODUUHVXOWVEXWUHGXFHGWKHWLPHRIVLPXODWLRQIRUHDFKGD\WRRQHKRXU7KHUHVXOWVVKRZWKDWWKHGHIDXOWYDOXHVFDQJLYHTXLWHFORVHILWWRWKDWRIWKHDFWXDORXWOHWIRUWRWDO&2',WVKRXOGEHQRWHGKHUHWKDWWKHVLPXODWHGWRWDO&2'ZDVPRVWO\LQWKHIRUPRISDUWLFXODWH&2'2YHUDOOGLVFXVVLRQ8VLQJ672$7DVDGHIDXOWPRGHOWRVLPXODWHWKHSHUIRUPDQFHRIWKHIXOOVFDOH%$)ZDVVWUDLJKWIRUZDUGIRUWKHPRGHOOLQJRIWRWDO&2'UHPRYDO+RZHYHUPRGHOOLQJWKHUHPRYDORIVROXEOH&2'SURYHGWREHDPRUHFRPSOLFDWHGWDVNDQGFKDQJHVWRWKHFDOLEUDWLRQSDUDPHWHUVZHUHQHHGHGWREHPDGHLQRUGHUWRREWDLQDEHWWHUILW,QVRPHFDVHVWKHVHFKDQJHVZHUHVHYHUHHVSHFLDOO\WKRVHUHODWHGWRWKHDWWDFKPHQWFRHIILFLHQWWKHR[\JHQKDOIVDWXUDWLRQFRHIILFLHQWDQGWKHVKHDUFRHIILFLHQWV7KHODFNRILQIRUPDWLRQRQWKHUDQJHVRIWKHVHSDUDPHWHUVPDNHVWKHWDVNRIREWDLQLQJDEHWWHUILWRIWKHPHDVXUHGGDWDDVKRWLQWKHGDUNZKLFKPHUHO\UHOLHVRQWULDODQGHUURU5XQQLQJWKHILUVWRUJDQLFORDGLQJUDWHGDWDIRUWKHVXQNHQDQGWKHIORDWLQJEHGVXVLQJWKHFDOLEUDWHGPRGHOVVKRZHGWKHPRGHOWRIDLODIWHUWZRPRQWKVRIVXFFHVVIXOO\VLPXODWLQJWKHSHUIRUPDQFHRIWKHUHDFWRUV$FFRUGLQJO\DGGLWLRQDOFKDQJHVZHUHPDGHWRPDLQWDLQDJRRGPDWFKEHWZHHQWKHDFWXDODQGWKHSUHGLFWHGGDWDVXFKDVWKRVHUHODWHGWRWKHR[\JHQKDOIVDWXUDWLRQFRHIILFLHQW)XUWKHUFKDQJHVWRWKHFDOLEUDWHGPRGHOWRVXFFHVVIXOO\VLPXODWHWKHSHUIRUPDQFHRIWKHVXQNHQDQGWKHIORDWLQJEHGUHDFWRUVGXULQJWKHVHFRQGDQGWKHWKLUGRUJDQLFORDGLQJUDWHVZHUHDOVRUHTXLUHG7KLVZDVGRQHXVLQJFKDQJHVWRWKHPDVVWUDQVIHUILOPHQKDQFHPHQW7KHQHHGWRPRGLI\WKHYDOXHRIWKLVSDUDPHWHUIRUWKHGLIIHUHQWRUJDQLFORDGLQJUDWHVPD\EHUHODWHGWRWKHVLPSOHQDWXUHRIWKHFRQFHQWUDWHGFRQIHFWLRQHU\ZDVWHXVHGWRERRVWWKHVROXEOH&2'RIWKHLQIOXHQWGXULQJWKHVHFRQGDQGWKHWKLUGRUJDQLFORDGLQJUDWHV,WVKRXOGEHQRWHGWKDWWKHKLJKHVWYDOXHVRIWKHPDVVWUDQVIHUILOPHQKDQFHPHQWZHUHWKRVHDVVRFLDWHGZLWKWKHVHFRQGRUJDQLFORDGLQJUDWHLQGLFDWLQJWKDWWKHEHVWWUDQVIHUUDWHRIVROXEOH&2'ZDVWDNLQJSODFHGXULQJWKLVORDGLQJUDWH

  •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

  •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

  • )LJXUH672$7IORZVKHHWUHSUHVHQWLQJ%$)OD\RXWIRUVLPXODWLRQ

    )LJXUH&DOLEUDWLRQRIWKHUHPRYDORIVROXEOH&2'LQWKHVXQNHQEHG

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'LQ 6ROXEOH&2'RXW 6LPXODWHGVROXEOH&2'RXW

  • )LJXUH&DOLEUDWLRQRIWKHUHPRYDORIVROXEOH&2'LQWKHIORDWLQJEHG

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'LQ 6ROXEOH&2'RXW 6LPXODWHGVROXEOH&2'RXW

    )LJXUH&RPSDULVRQEHWZHHQWKHDFWXDODQGVLPXODWHGVROXEOH&2'IRUWKHVXQNHQEHGGXULQJWKHILUVWRUJDQLFORDGLQJUDWH

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'RXW6LPXODWHGVROXEOH&2'RXW$GMXVWHGVLPXOWHGVROXEOH&2'RXW

  • )LJXUH&RPSDULVRQEHWZHHQWKHDFWXDODQGVLPXODWHGVROXEOH&2'IRUWKHVXQNHQEHGGXULQJWKHVHFRQGRUJDQLFORDGLQJUDWH

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'RXW6LPXODWHGVROXEOH&2'RXW$GMXVWHGVLPXODWHGVROXEOH&2'RXW

    )LJXUH&RPSDULVRQEHWZHHQWKHDFWXDODQGVLPXODWHGVROXEOH&2'IRUWKHVXQNHQEHGGXULQJWKHWKLUGRUJDQLFORDGLQJUDWH

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'RXW 6LPXODWHGVROXEOH&2'RXW $GMXVWHGVLPXODWHGVROXEOH&2'RXW

  • )LJXUH&RPSDULVRQEHWZHHQWKHDFWXDODQGVLPXODWHGVROXEOH&2'IRUWKHIORDWLQJEHGGXULQJWKHILUVWRUJDQLFORDGLQJUDWH

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'RXW6LPXODWHGVROXEOH&2'RXW$GMXVWHGVLPXODWHGVROXEOH&2'RXW

    )LJXUH&RPSDULVRQEHWZHHQWKHDFWXDODQGVLPXODWHGVROXEOH&2'IRUWKHIORDWLQJEHGGXULQJWKHVHFRQGRUJDQLFORDGLQJUDWH

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'RXW6LPXODWHGVROXEOH&2'RXW$GMXVWHGVLPXODWHGVROXEOH&2'RXW

  • )LJXUH&RPSDULVRQEHWZHHQWKHDFWXDODQGVLPXODWHGVROXEOH&2'IRUWKHIORDWLQJEHGGXULQJWKHWKLUGRUJDQLFORDGLQJUDWH

    'DWH

    6ROXEOH&2

    'PJO

    6ROXEOH&2'RXW 6LPXODWHGVROXEOH&2'RXW

    )LJXUH&RPSDULVRQEHWZHHQWKHDFWXDODQGVLPXODWHGWRWDO&2'IRUWKHIXOOVFDOHVXQNHQ%$)

    'DWH

    7RWDO&2'

    PJO

    7RWDO&2'LQPJO 7RWDO&2'RXWPJO 'HIDXOWVLPXODWHG&2'RXW

  • (YDOXDWLRQRI%URXZHUVUHVSLURPHWU\EDVHGDFWLYDWHGVOXGJHFRQWUROVWUDWHJ\&ULVWLDQR%DVWLDQXWWL3HSSH%RUWRQH3DROR&LUHOORA-HUHP\'XGOH\,WDOLDQ1DWLRQDO$JHQF\IRU1HZ7HFKQRORJLHV(QHUJ\DQG(QYLURPHQW9LD0DUWLULGL0RQWHVROH%RORJQD,WDO\A:5F9LD$QWRQHOOL5RPH,WDO\:5F)UDQNODQG5RDG%ODJURYH6ZLQGRQ:LOWVKLUH61

  • 7KHDHURELFYROXPHUHTXLUHGWRR[LGLVHWKHG\QDPLFLQIOXHQWORDGRIQLWULILDEOHQLWURJHQLVFDOFXODWHGWKURXJKWKHIRUPXODPD[

    QK

    QK::DHU U 6)9 u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

  • 5$6UHF\FOHZDVIURPWKHVHWWOHUWRWKHILUVWFRPSDUWPHQWDQGWKHLQWHUQDOUHF\FOHIURPWKHILIWKWRWKHILUVWFRPSDUWPHQW7KXVWKHQHZFRQILJXUDWLRQPDLQO\GLIIHUVIURPWKHRULJLQDORQHEHFDXVHRIWKHHOLPLQDWLRQRIWKHDQDHURELFFRPSDUWPHQW7KLVPRGLILFDWLRQVKRXOGQRWLQIOXHQFHWKHJRDORIWKHVWUDWHJ\ZKLFKLVWKHFRPSOHWHR[LGDWLRQRILQIOXHQWQLWULILDEOHQLWURJHQ$QRWKHUPRGLILFDWLRQRIWKHRULJLQDOEHQFKPDUNOD\RXWKDVEHHQDOVRQHFHVVDU\WKHLQWURGXFWLRQRIDVPDOOUHVSLURPHWU\FKDPEHUFRPSDUWPHQWP RIYROXPHEHWZHHQWKHILUVWDQR[LFFRPSDUWPHQWDQGWKHVHFRQGIDFXOWDWLYHFRPSDUWPHQW%URXZHUHWDOFDUULHGRXWWKHUHVSLURPHWU\PHDVXUHVRQVDPSOHVRIVOXGJHWDNHQIURPWKHODVWFRPSDUWPHQWRIWKHSODQWDIWHUKDYLQJNHSWWKHPLQWZRGLIIHUHQWHQGRJHQRXVYHVVHOVWRDYRLGWKHLQWHUIHUHQFHRIUHVLGXDO&2'UHVSLUDWLRQ$OWKRXJK672$7FRXOGDOORZWKLVDUUDQJHPHQWQLWURJHQUHVSLUDWLRQUDWHZDVGLUHFWO\REWDLQHGDVDPRGHORXWSXW$QRWKHUSUREOHPZDVUHSUHVHQWHGE\WKHLQSODQWORFDOLVDWLRQRIWKHUHVSLUDWLRQPHDVXUHV6LQFHDPPRQLDR[LGDWLRQUDWHLVDIXQFWLRQRIDPPRQLDDQGR[\JHQFRQFHQWUDWLRQWKHDPPRQLDFRQFHQWUDWLRQGHFUHDVHVWKURXJKWKHSODQWUHDFWRUVOHDGLQJWRDGHFUHDVHLQWKHR[LGDWLRQUDWHRQWKHRWKHUKDQG'2LVH[SHFWHGWRLQFUHDVHIURPWKHVHFRQGWRWKHILIWK FRPSDUWPHQWWKXVLQFUHDVLQJWKHR[LGDWLRQUDWH)RUWKLVUHDVRQDVPDOOUHVSLURPHWU\FRPSDUWPHQWIRUWKHDXWRWURSKVUHVSLUDWLRQUDWHPHDVXUHPHQWZDVSODFHGLPPHGLDWHO\DIWHUWKHDQR[LF]RQH7KLVFRPSDUWPHQWUHFHLYHVDOOLQIOXHQWDPPRQLDZLWKWKHH[FHSWLRQRIDYHU\VPDOOIUDFWLRQDVVLPLODWHGE\WKHELRPDVVLQWKHDQR[LFFRPSDUWPHQWDQGDWWKHVDPHWLPHLWKDVDFRQWLQXRXVVXSSO\RIR[\JHQIL[HG./D K$XWRWURSKVUHVSLUDWLRQUDWHZKLFKDVLWZLOOEHH[SODLQHGODWHUZDVWKHFUXFLDOSDUDPHWHUWRFRQWUROWKHUHTXLUHGDHURELFYROXPHRIWKHIRUPXODZDVPHDVXUHGKHUH7KHRQO\SUREOHPRISODFLQJWKHUHVSLURPHWU\FKDPEHULQVLGHWKHSODQWLVWKDWLQWKLVZD\WKHUHLVWKHLQWHUIHUHQFHRIDPPRQLDUHF\FOHGEDFNWRWKHUHVSLUDWLRQFKDPEHUWKURXJKWKHUHF\FOHVWUHDPV1HYHUWKHOHVVWKLVVXUSOXVRIWKHUHF\FOHGDPPRQLDZDVFRQVLGHUHGQHJOLJLEOHFRPSDUHGWRWKHLQIOXHQWPDVVIOX[DQGWKHUHIRUHWKLVDVSHFWZDVQRWFRQVLGHUHG 7DEOHDQI)LJXUHVKRZWKHPRGLILHGEHQFKPDUNOD\RXWRIDFWLYDWHGVOXGJHWDQNXVHGWRLPSOHPHQWWKLVFRQWUROVWUDWHJ\7DEOHRULJLQDODQGPRGLILHGEHQFKPDUNOD\RXW2ULJLQDOEHQFKPDUNOD\RXWRIDFWLYDWHGVOXGJHWDQN 0RGLILHGEHQFKPDUNOD\RXWRIDFWLYDWHGVOXGJHWDQN& P P5HVSLURPHWU\FKDPEHU B P& P P& P P& P P& P P7RWDOYROXPH P P

  •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u ,PSOHPHQWLQJWKHVWUDWHJ\LQ672$7QRWRQO\WKHYDOXHVRI):: EXWDOVR6QK KDYHEHHQGLUHFWO\WDNHQIURPWKHLQIOXHQWYDOXHVDQGQRWGHGXFHGIURPUHVSLURPHWULFPHDVXUHVZKLOHLQWKHVWXG\WKHDXWKRUVFDOFXODWHG6QKWKURXJKWKH5(6&8(7KLVLVREYLRXVO\DVLPSOLILFDWLRQEXWGRHVQRWVHHPWRDIIHFWWKHJHQHUDOHYDOXDWLRQRIWKHFRQWUROVWUDWHJ\,QRUGHUWRFRQVLGHUQRWRQO\DPPRQLDEXWDOVRDOOQLWULILDEOHQLWURJHQWKDWLVDPPRQLDSOXVWKHRUJDQLFIRUPVRIQLWURJHQLQWKHLPSOHPHQWDWLRQ6QK KDVEHHQWUDQVIRUPHGLQWR67.1U1KPD[ KDVEHHQFDOFXODWHGIURPDXWRWURSKVUHVSLUDWLRQUDWHWKURXJKWKHIROORZLQJUHODWLRQ

    PD[ 285V$XWRWURSKUQK

  • &RQWUROOHUV672$7KDVJRWWZRGLIIHUHQWW\SHVRIFRQWUROOHUV3,'FRQWUROOHUDQG/DGGHU/RJLFFRQWUROOHU7RLPSOHPHQWWKHVWUDWHJ\WKUHH/DGGHU/RJLFFRQWUROOHUVKDYHEHHQXVHG7KH/DGGHU/RJLFFRQWUROOHUVXSSRUWVPXOWLSOHLQSXWVZLWKWKHRXWSXWGHFLGHGE\DVHULHVRI,)VWDWHPHQWV7KHILUVWWUXHFRQGLWLRQLVHYDOXDWHGDQGXVHGDVWKHRXWSXWRIWKHFRQWUROOHU,IQRFRQGLWLRQLVWUXHWKHQWKHRXWSXWLVWKHODVWRXWSXWIURPWKHFRQWUROOHU7ZRPDWKHPDWLFDOPRGHOVDUHDYDLODEOH'LVFUHWH DQG&RQWLQXRXV7KHODWWHUPRGHOSURYLGHVDFRQWLQXRXVRXWSXWDQGZDVFKRVHQIRUWKHLPSOHPHQWDWLRQ7KHLQSXWRIWKHWKUHHFRQWUROOHUVZDVWKHDOJRULWKPRIWKHIRUPXODSURSRVHGE\%URXZHUHWDODQGLWZDVPHDVXUHGLQWKHUHVSLURPHWU\FRPSDUWPHQWRIWKHSODQW7KHRXWSXWVRIWKHWKUHHFRQWUROOHUVZHUHUHVSHFWLYHO\WKH./DRIWKHVHFRQGWKLUGDQGIRXUWKFRPSDUWPHQW,QWKHVHFRPSDUWPHQWV./DZDVIL[HGWR]HUREXWWKHDFWLRQRIWKHFRQWUROOHUFRXOGVZLWFKWKHYDOXHRI./DWR,QWKLVZD\WKHRQRIIVZLWFKLQJRIWKHDHUDWLRQHTXLSPHQWZDVVLPXODWHG7DEOHSURYLGHVDVXPPDU\RIFRQWUROOHULQSXWDQGRXWSXW7DEOH6XPPDU\RIFRQWUROOHULQSXWDQGRXWSXW/DGGHU/RJLFFRQWUROOLQJFRPSDUWPHQWQR /DGGHU/RJLFFRQWUROOLQJFRPSDUWPHQWQR /DGGHU/RJLFFRQWUROOLQJFRPSDUWPHQWQR,QSXWSDUDPHWHU &RQWURODOJRULWKPFDOFXODWHGLQWKHUHVSLURPHWU\FRPSDUWPHQW &RQWURODOJRULWKPFDOFXODWHGLQWKHUHVSLURPHWU\FRPSDUWPHQW &RQWURODOJRULWKPFDOFXODWHGLQWKHUHVSLURPHWU\FRPSDUWPHQW2XWSXWSDUDPHWHU ./DLQ&RPSDUWPHQWQR ./DLQ&RPSDUWPHQWQR ./DLQ&RPSDUWPHQWQR2SHUDWLRQDOVWDWHPHQWV ,)97+(1./D ,)97+(1./D

    ,)97+(1./D ,)97+(1./D ,)97+(1./D ,)97+(1./D

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

  • 7DEOH 6XPPDU\ RI VHOHFWHG SHUIRUPDQFH GDWD IURP WKH XQFRQWUROOHG WKUHH SHUPDQHQWO\ DHUDWHG WDQNVVLPXODWLRQ3URFHVV3HUIRUPDQFH GU\ UDLQ VWRUP 8QLWV(4LQGH[ ( ( ( NJG

    $YJ6OXGJH3URGXFWLRQGLVSRVDO NJ66G$YJ6OXGJH3URGXFWLRQWRWDO NJ66G$HUDWLRQ(QHUJ\ N:KG3XPSLQJ(QHUJ\ N:KG

    (IIOXHQWDYJ766FRQF J66P(IIOXHQWDYJ7.1FRQF J1P(IIOXHQWDYJ1FRQF J1P(IIOXHQWDYJWRWDO&2'FRQF J&2'P(IIOXHQWDYJ%2' FRQF J2P7DEOH 6XPPDU\RIVHOHFWHGSHUIRUPDQFHGDWDIURPWKHFRQWUROVWUDWHJ\VLPXODWLRQ3URFHVV3HUIRUPDQFH GU\ UDLQ VWRUP 8QLWV(4LQGH[ ( ( ( NJG

    $YJ6OXGJH3URGXFWLRQGLVSRVDO NJ66G$YJ6OXGJH3URGXFWLRQWRWDO NJ66G$HUDWLRQ(QHUJ\ N:KG3XPSLQJ(QHUJ\ N:KG

    (IIOXHQWDYJ766FRQF J66P(IIOXHQWDYJ7.1FRQF J1P(IIOXHQWDYJ1FRQF J1P(IIOXHQWDYJWRWDO&2'FRQF J&2'P(IIOXHQWDYJ%2' FRQF J2P7DEOH &RPSDULVRQRIVHOHFWHGSHUIRUPDQFHGDWD3URFHVV3HUIRUPDQFH &RQWUROVWUDWHJ\ )RXUSHUPDQHQWO\DHUDWHGWDQNV 7KUHHSHUPDQHQWO\DHUDWHGWDQNVRSHQORRS 8QLWV(4LQGH[ ( ( ( NJG

    $YJ6OXGJH3URGXFWLRQGLVSRVDO NJ66 G$YJ6OXGJH3URGXFWLRQWRWDO NJ66 G$HUDWLRQ(QHUJ\ N:KG

    (IIOXHQWDYJDPPRQLDFRQF NJ1 G(IIOXHQWDYJDPPRQLDORDG NJ1 G(IIOXHQWDYJ7.1FRQF NJ1 G(IIOXHQWDYJ1WRWFRQF NJ1 G7.1FRQVWUDLQWOLPLWPJ1ORIYLRODWLRQV 1WRWFRQVWUDLQWOLPLWPJ1ORIYLRODWLRQV

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

  • 7KHFRQWUROVWUDWHJ\LVSUHGLFWHGWRKDYHDKLJKHUFRQFHQWUDWLRQRIVROLGVLQWKHHIIOXHQWIRUH[DPSOH766DQG;EKWKDQWKHRSHQORRSFDVH$UHGXFWLRQLQWKHDYHUDJHDHUDWHGYROXPHOHDGVWRDFRQVHTXHQWULVHLQWKH0/666OXGJHSURGXFWLRQ 90/66JURZWKUDWH7KHJURZWKUDWHLVDSSUR[LPDWHO\FRQVWDQWDVLVWKHVOXGJHSURGXFWLRQ7KHLQFUHDVHGVROLGVORDGLQJRQWKHFODULILHULQLWVWXUQOHDGVWRKLJKHUHIIOXHQWVXVSHQGHGVROLGV7KHUHLVDQHJOLJLEOHLQFUHDVHLQWKHWRWDOVOXGJHSURGXFWLRQWKHFKDQJHLVPRUHLQWKHLQFUHDVHLQVROLGVORVWWKURXJKWKHHIIOXHQWDQGDUHGXFWLRQLQWKHVROLGVORVWWKURXJKGHOLEHUDWHZDVWDJH7KLVVKRXOGQRWEHUHDGDVQHFHVVDULO\DIDLOLQJRI%URXZHUVFRQWUROVWUDWHJ\+DGWKHEHQFKPDUNFRQILJXUDWLRQXVHGPRUHVWDJHVVRWKDWDILQHUGHJUHHRIFRQWURORIWKHDHUDWHGYROXPHZDVSRVVLEOHRUKDGWKHFODULILHUKDGDJUHDWHUVXUIDFHDUHDRUWKHVOXGJHEHWWHUVHWWOLQJSURSHUWLHVWKHQWKHHIIHFWRQHIIOXHQWVROLGVPD\QRWKDYHEHHQDQLVVXH6LQFHWKHDLPRIWKHVWUDWHJ\LVWRR[LGLVHDOOLQIOXHQWDPPRQLDQLWURJHQZLWKWKHPLQLPXPUHTXLUHPHQWRIHQHUJ\IRUDHUDWLRQDWWHQWLRQPXVWEHSDLGWRWKHVHWZRSDUDPHWHUV7KHUHIHUHQFHVLPXODWLRQZLWKIRXUSHUPDQHQWO\DHUDWHGWDQNVSURYLGHVWKHOLPLWRIDPPRQLDR[LGDWLRQHLWKHULQWHUPVRIFRQFHQWUDWLRQRULQWHUPVRIORDG7KHFRQWUROVWUDWHJ\VKRXOGSURGXFHYDOXHVTXLWHFORVHWRWKHVHOLPLWVZLWKDGHFUHDVHRIDHUDWLRQHQHUJ\WREHFRQVLGHUHGFRPSOHWHO\VXFFHVVIXO5HVXOWVDUHGLIIHUHQWDQGDPPRQLDYDOXHVLQWKHHIIOXHQWDUHFRQVLGHUDEO\KLJKHUZLWKWKHFRQWUROVWUDWHJ\7KHVHFRQGUHIHUHQFHVLPXODWLRQVKRZVDORZHUDPPRQLDHIIOXHQWYDOXHVZLWKORZHUDHUDWLRQHQHUJ\UHTXLUHPHQWDQGHYHQWKRXJKWKLVLVQRWWKHJRDORIWKHFRQWUROVWUDWHJ\DEHWWHU(4LQGH[)LJXUHUHSRUWVWKHJUDSKRIDPPRQLDFRQFHQWUDWLRQSURILOHLQWKHHIIOXHQWIRUWKHWKUHHVLPXODWLRQV

    $PPRQLDFRQFHQWUDWLRQSURILOHLQWKHHIIOXHQW

    7LPHKRXUV

    $PPRQLDF

    RQFHQWUDWLR

    QPJ1O WDQNVDHUDWHGWDQNVDHUDWHG&RQWUROVWUDWHJ\

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

  •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u EXWFKDQJLQJWKH/DGGHU/RJLFFRQWUROOHURSHUDWLRQDOVWDWHPHQWVWRLQFOXGHDVDIHW\IDFWRUDVUHSRUWHGLQ7DEOH,QWKHILUVWVLPXODWLRQWKHYDOXHRIVDIHW\IDFWRUZDVLQWKHVHFRQG7DEOHVKRZVWKHPRGLILHGYDOXHVRIFRQWUROOHURSHUDWLRQDOVWDWHPHQWV7DEOH0RGLILHGYDOXHVRIFRQWUROOHURSHUDWLRQDOVWDWHPHQWV/DGGHU/RJLFFRQWUROOLQJFRPSDUWPHQWQR /DGGHU/RJLFFRQWUROOLQJFRPSDUWPHQWQR /DGGHU/RJLFFRQWUROOLQJFRPSDUWPHQWQR,QSXWSDUDPHWHU &RQWURODOJRULWKPFDOFXODWHGLQWKHUHVSLURPHWU\FRPSDUWPHQW &RQWURODOJRULWKPFDOFXODWHGLQWKHUHVSLURPHWU\FRPSDUWPHQW &RQWURODOJRULWKPFDOFXODWHGLQWKHUHVSLURPHWU\FRPSDUWPHQW2XWSXWSDUDPHWHU ./DLQ&RPSDUWPHQWQR ./DLQ&RPSDUWPHQWQR ./DLQ&RPSDUWPHQWQR2SHUDWLRQDOVWDWHPHQWVZLWK6) ,)97+(1./D ,)97+(1./D

    ,)97+(1./D ,)97+(1./D ,)97+(1./D ,)97+(1./D 2SHUDWLRQDOVWDWHPHQWVZLWK6) ,)97+(1./D ,)97+(1./D

    ,)97+(1./D ,)97+(1./D ,)97+(1./D ,)97+(1./D 7DEOHSURYLGHVSURYLGHVDVXPPDU\RIWKHPRVWXVHIXOSDUDPHWHUVFRQFHUQLQJQLWURJHQIRUPVLQWKHHIIOXHQWWRJHWKHUZLWKVHOHFWHGSHUIRUPDQFHGDWDRIWKHRULJLQDOFRQWUROVWUDWHJ\VLPXODWLRQDQGRIWKHWZRVLPXODWLRQVZLWKVDIHW\IDFWRUV7KHFRPSOHWHUHVXOWVRIWKHVHVLPXODWLRQVDUHUHSRUWHGLQWKH$SSHQGL[

    7DEOH6XPPDU\RIVHOHFWHGSHUIRUPDQFHGDWD3URFHVV3HUIRUPDQFH 2ULJLQDO&RQWUROVWUDWHJ\ &RQWUROVWUDWHJ\ZLWK6) &RQWUROVWUDWHJ\ZLWK6) XQLWV(4LQGH[ ( ( ( NJG$YJ6OXGJH3URG NJ66 G

  •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

    $PPRQLDFRQFHQWUDWLRQSURILOHLQWKHHIIOXHQW

    7LPHKRXUV

    $PPRQLDF

    RQFHQWUDWLR

    QPJ1O &RQWUROVWUDWHJ\&RQWURO6) &RQWURO6)

    )LJXUH$PPRQLDFRQFHQWUDWLRQSURILOHLQWKHHIIOXHQW7DEOH 'DWDRQDHUDWLRQVZLWFKLQJ&RQWUROVWUDWHJ\VLPXODWLRQ6) &RQWUROVWUDWHJ\VLPXODWLRQ6) 7DQNQR 7DQNQR 7DQNQR 7DQNQR 7DQNQR 7DQNQR1XPEHURIWLPHVZKHQDHUDWLRQKDVEHHQVZLWFKHGRQ

    3HUFHQWDJHRIWLPH

  •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

    $PPRQLDO

    RDGNJ1G

    WDQNVDHUDWHG &RQWUROVWUDWHJ\ &RQWUROVWUDWHJ\6) &RQWUROVWUDWHJ\6)

    WDQNVDHUDWHG6LPXODWLRQV

    &RPSDULVRQRIHIIOXHQW$PPRQLDORDGV

    )LJXUH(IIOXHQWDPPRQLDORDGV

    $HUDWLRQ(

    QHUJ\UHTX

    LUHPHQW

    .:KG

    WDQNVDHUDWHG &RQWUROVWUDWHJ\ &RQWUROVWUDWHJ\6) &RQWUROVWUDWHJ\6) WDQNVDHUDWHG6LPXODWLRQV

    &RPSDULVRQRI$HUDWLRQHQHUJ\UHTXLUHPHQWV

  •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

  • 7DEOH*UH\VFDOHUHSUHVHQWDWLRQRIRXWSXWGDWDOLJKWHUWKHFRORXUEHWWHUWKHRXWSXWYDULDEOH3URFHVV3HUIRUPDQFH 7KUHHWDQNVDHUDWHGRSHQORRS

    &RQWUROVWUDWHJ\ &RQWUROVWUDWHJ\ZLWK6)&RQWUROVWUDWHJ\ZLWK6)

    )RXUWDQNVDHUDWHG 8QLWV

    (4LQGH[ NJG

    6OXGJH3URGXFWLRQ NJ66G

    $HUDWLRQ(QHUJ\ N:KG

    (IIOXHQWDPPRQLDORDG NJ1G

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

  • 3URFHVVPRGHOOLQJRIDQ2UEDO::73XVLQJ672$7DVHQVLWLYLW\DQDO\VLV/-%8552:6D-5:(67D&))2567(5D $0$57,1E$1'-'8'/(

  •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

  •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x 7HPSHUDWXUHx ,QIOXHQWIORZUDWHx ,QIOXHQWSROOXWDQWFRQFHQWUDWLRQx 5$6IORZUDWHx :$6IORZUDWHx '2FRQFHQWUDWLRQLQWKHVHFRQGWDQNRIWKHRXWHUFKDQQHOx 5HODWLYHYROXPHVRIWKHWDQNVLQWKHRXWHUFKDQQHOx $XWRWURSKLFJURZWKUDWH7KHVDPHFROGVWDUWZDVUXQWRDVWHDG\VWDWHIRUHDFKVFHQDULRDQGWKHVHQVLWLYLW\ZDVPHDVXUHGE\WKHGLIIHUHQFHVEHWZHHQWKHWZRUHVXOWLQJVWHDG\VWDWHV7KHILUVWVWHSLQWKHVHQVLWLYLW\DQDO\VLVZDVWRUXQWKHPRGHOVIRUDEDVHFDVHZKHUHWKHSDUDPHWHUVZHUHVHWWRYDOXHVFRQVLGHUHGWREHFRUUHFWIRUWKHFRQGLWLRQVSUHYDLOLQJGXULQJWKHVXPPHURI7KHPRGHOGHIDXOWWHPSHUDWXUHRI2&ZDVXVHGIRUVLPSOLFLW\UDWKHUWKDQWKHPHDVXUHGWHPSHUDWXUHRI2&7KHPRGHOVZHUHUXQIRUWKHHTXLYDOHQWRIIRXUPRQWKVWRHQVXUHWKDWDOOWKHGHWHUPLQDQGVKDGUHDFKHGVWHDG\VWDWHDQGWKHUHVXOWVDUHJLYHQLQ7DEOHWRJHWKHUZLWKWKHDYHUDJHURXWLQHPRQLWRULQJGDWDIRUWKHVDPHSHULRG7KHUHVXOWVVKRZWKDWDOOWKHPRGHOVSUHGLFWWKHDYHUDJHGHWHUPLQDQGVWRDUHDVRQDEOHGHJUHHRIDFFXUDF\DSDUWIURPWKH7&2'DQG0/66IRU,$:4DQGWKH5$6IRUDOOWKHPRGHOV$OOWKHPRGHOOHGUHVXOWVIHOOZLWKLQWKHPLQLPXPDQGPD[LPXPYDOXHVIRUDOOWKH"7KHORZYDOXHIRUWKHILQDOHIIOXHQW7&2'IRUWKH,$:4PRGHOGRHVQRWILWLQWRWKHVSUHDGRIYDOXHVREVHUYHGDWWKHZRUNV

  • PD[LPXP PJOPLQLPXP PJODQGLWLVWKRXJKWWKDWWKLVZDVGXHWRWKHPHWKRGXVHGWRVSOLWWKH7&2'LQWRWKHIRXUIUDFWLRQVXVHGLQWKHPRGHOLQIOXHQWSURILOH,WZRXOGDSSHDUWKDWWKHZRUNVKDVDKLJKHUSHUFHQWDJHRIQRQELRGHJUDGDEOH&2'WKDQKDVEHHQDOORZHGIRULQWKHLQIOXHQWSURILOH,WLVDOVRSRVVLEOHWKDWWKHGHIDXOWVHWWLQJVXVHGIRUWKHSURGXFWLRQRIPLFURELDOUHVLGXDOVZLWKLQWKHPRGHOGRQRWDFFXUDWHO\UHSUHVHQWWKHEHKDYLRXURIWKHELRPDVVDW3UHVWRQ1RPHDVXUHPHQWVRIWKHVHSDUDPHWHUVZHUHPDGHDQGWKHUHIRUHWKH\ZHUHOHIWDWWKHGHIDXOWYDOXHV7KHIU