Petroteq Energy Inc. released its management’s vision of what gives the Company a unique advantage in the market as it positions itself as a provider of a clean technology for the recovery of oil from oil sands.
The Company’s Clean Oil Recovery Technology (“CORT”) integrates clean technology with oil sands production. Some CORT attributes of note are listed below:
- Proprietary extraction technology
- Pre-FEED (Front End Engineering and Design) work for 5-10k bpd facility completed recently by Crosstrails Engineering LLC, a subsidiary of Valkor LLC (as reported in the Company’s press release dated September 15, 2020)
- 10,000 bbl of oil produced to date from pilot plant and Asphalt Ridge facility
- Extraction technology that greatly reduces greenhouse gases when compared to other extraction methods
- Leaves no waste water or tailings pond
- Up to 99% of hydrocarbons are extracted
- 95% of solvents used are recovered and recycled within the closed-loop system
- Produces bitumen and a clean, dry sand (meeting EPA Tier 1 standards) as the only by-product
- Relatively small modular footprint; designed to be scalable through the addition of parallel production trains
- Design is based upon standard oil processing equipment, short lead times
- Low capex estimated at US$15-$20k per daily bbl per recent pre-FEED study
- Low production costs, estimated to average $25-$30/bbl dependent upon production volume
- Flexibility in terms of being capable of producing various different end products
For a visual representation of the CORT process
The Company is evaluating the various plant outputs that can be produced using CORT with a view towards optimizing end product pricing. Besides the base bitumen that can be extracted from the mined oil sands, the Company will evaluate the use of MSAR® technology from Quadrise Fuels International plc for post processing of the produced bitumen.
Regulations adopted by the International Maritime Organization (IMO) require that sulphur content in marine fuels be reduced from 3.5% to 0.5% with effect from January 2020. The Company believes that the MSAR® process will add value to the oil produced from Asphalt Ridge by producing a low sulphur fuel oil suitable for use as a marine bunker fuel, or as a fuel oil for industrial power generation. A benefit of the MSAR® process is that because hydrocarbon droplets are pre-atomised within the emulsion and are significantly smaller than the droplets formed from atomising HFO, MSAR® burns almost completely, leaving virtually no particulate carbon in the exhaust and making it more environmentally friendly. Low sulphur fuel oil currently trades at a premium to WTI crude.
The Company is also evaluating the possibility of adjusting its extraction plant to produce a dual output of diesel and asphalt, both of which trade at a premium to WTI. The asphalt market is subject to seasonal variation, being particularly strong during the summer months.
George Stapleton, Petroteq’s COO, commented on the distinct features of CORT that set it apart, saying: “CORT is an environmentally benign process for producing oil from oil sands having low initial capital requirements and low operating expenses while allowing for end products to be varied to best suit market conditions.”
In addition, the Company also intends to complete two shares for debt transactions, pursuant to which it will issue an aggregate of 2,041,095 common shares in satisfaction of US$149,000 of indebtedness. The Company determined (with the creditors’ consent) to satisfy the foregoing indebtedness with common shares in order to preserve the Company’s cash for use on its extraction technology in Asphalt Ridge, Utah, and for working capital. The transactions are subject to completion and execution of a definitive agreements and all necessary approvals, including from the TSX Venture Exchange (the “Exchange”). The securities issuable pursuant to the transactions will be issued in reliance on exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), and applicable state securities laws, and will be issued as “restricted securities” (as defined in Rule 144 under the U.S. Securities Act). In addition, such securities will be subject to a Canadian four-month hold period.
The Company also announces that it has closed the US$300,000 principal amount (including an original issue ?discount of 20%) unsecured convertible debenture financing previously announced on September 22, 2020.