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April 2010

April 2010. Flare Gas Monetization. Greg Loewen, President & CEO. The Problem. The problem is many companies are burning their valuable resources. BURNING GAS is BURNING CASH!. RGT. The Problem.

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April 2010

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  1. April 2010 Flare Gas Monetization Greg Loewen, President & CEO

  2. The Problem The problem is many companies are burning their valuable resources. BURNING GAS is BURNING CASH!

  3. RGT The Problem We want to help companies that burn the gas they produce from oil wells turn their resources into revenue. TURNING GAS into CASH! $$$$$ Why will operators change? New Saskatchewan Flaring Guidelines Requires flare gas conservation by Jan 2011.

  4. Loading Facility Unloading Facility The Solution - Rich Gas Transportation (RGT) • Currently gas is being flared. 3RD party Transport Oil Well Solution Gas • Install our proprietary skid mounted Loading Facility. • Load the container. • Use 3rd party transport to take it to the Gas Plant. • Transport the gas from the source to a plant, pipeline, or end user. • Scaleable, portable and uses conventional oilfield equipment. • Unload the container and then return it to the wellsite to be filled again. Gas Plant

  5. Worldwide flare gas 15,000 mmcf/day 320 mmcf/day $470 MM/yr N. America 130 mmcf/day $180 MM/yr Canada Sask 50 mmcf/day $75 MM/yr Flare Gas Market OUR GOAL 5% of Canada Market in 3 Yrs $6 MM/Yr 2.4 million tonnes of Carbon Credit potential per year from flared gas in Canada

  6. Remove liquids & burn methane RGT Better flare stacks Status quo The Competition Cost Producer pipelines Power only works if the gas can be used as fuel and the electrical demand is in the same location as the gas. In most cases, the gas is being flared because pipelines are not economic. Power Generation • Capstone Tech • AGRI _ + Revenue Rich Gas Transportation provides the best combination of cost and revenue generation. Some of the competition falls off the table right away because of regulatory changes.

  7. RGT Our Process • W. Claire proprietary RGT process uses the unique characteristics of flare gas to make the transport economical. • Local engineering expertise. • Compression partner with market presence and equipment to handle flare gas. 3 x Volume 4 x Heat Content

  8. The Approach to Market Initially, sell direct to Saskatchewan producers flaring gas from oil wells. W. Claire has signed a Letter of Intent with PetroBakken Energy Inc. to implement a field demo of our process on one of their well sites. Compared to Alberta, there are more opportunities in Saskatchewan because of the significant flare volumes, limited infrastructure, high activity levels, and proposed new flaring regulations. Once established, we will channel sell through compression and/or equipment suppliers. Direct to Large Producers

  9. Business Model • Currently producer is making no revenue from flaring the gas. • Capturing the gas can generate significant revenues. • Up to 60% of the revenue is from the liquids in the gas. WCE Breakeven Point *150 mcf/d Well, 70 bbls/mmcf Liquids, after royalties and processing fees

  10. Business Model Producer Gas Plant $1.00 Revenue Monthly Fee + $/Volume shipped $0.75 to $0.90 W. Claire will charge the producer a flat monthly fee and a fee based on the volume shipped. For every dollar of revenue the producer receives (after royalties and plant processing fees), $0.75 to $0.90 goes to W. Claire for these fees. MARGIN = 48%

  11. Business Model • Economics for a typical system installed at a wellsite. • Added benefit not included in the revenue is increased oil production as a result of installing compression on the wellsite and reducing the wellbore pressure. *150 mcf/d Well, $4 Gas Prices, 70 bbls/mmcf Liquids, after royalties and processing fees

  12. The Forecast Millions except wells • Will ramp up quickly after field demo. • 2000+ Bakken wells in SE Sask and many more thousands to drill. • Estimate 100+ sites could use system now and 50+ more new sites per year. • Expansion will come through lease financing and equity offerings. *150 mcf/d Well, $4 Gas Prices, 70 bbls/mmcf Liquids, after royalties and processing fees

  13. 2010 2012 2011 Milestones • Previous offering used for demo design. • Current offering used to construct a field demonstration of process to be on stream by June 2010. Present F & F offering $0.5 million Sign LOI with PetroBakken Growth offering $15 million Growth offering $3 million Private offering $1.0 million Growth thru Lease Financing Demo design Field demo First 15 150 mcf/d projects 500 mcf/d project 5 mmcf/d project

  14. The People Board of Directors • John Mroch, Executive Chairman • 35 years in industry. • Several prior company start-ups. • Ray Gertz • 26 years of running his own company. • Director of two other public companies. • Greg Loewen • Jay Zammit • Corporate Secretary. • Partner at Burstall Winger. Will add to our board right away and to technical staff as operations ramp up. Management Greg Loewen, President & CEO • 29 years in industry. • Company start-up experience. Contract Robin Westin,V.P. Finance & CFO • Transportation company experience. • Worked for several start-ups. Don Fraser, CNG Consultant • 17 years compressed gas bulk transport experience.

  15. The Deal Current offering is for $1 Million. Money in: Founders $340 thousand Family and friends 780 thousand Other assets 220 thousand Coming Govt. grants 700 thousand Total $2.0 million Government R&D funding conditionally approved - IRAP and SR&ED. Breakdown of spending: Intellectual property protection $150 thousand Field demo in SE Sask 650 thousand Marketing, G&A200 thousandTotal $1.0 million 15

  16. RGT To Sum Up • Identify the Problem • Provide a Solution • The Market • Offering - $1 Million We need your help to take our company to the next step. $6 MM • Design the Product • Calculate a Forecast • We Have The Team 3 YEAR FORECAST 16

  17. Contact W. Claire Energy Corporation 401, 100 – 4th Avenue SW Calgary, AB Canada T2P 3N2 Phone: 403-452-7787 Mr. Greg Loewen, President & CEO greg@wclaire.com www.wclaire.com GAS to CASH! 17

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