The Company, headquartered in Calgary, Alberta Canada is now in the startup phase. The Company is poised to become a solid profit-producing entity via its’ own patent-pending oil extraction technology. The technology centers on reducing the costs and environmental impacts which usually accompany producing oil from sands. The Company founder will serve as the company’s principal industrial officer and is dedicated to leading the company’s planned implementation and subsequent expansion.
The Founder filed for a US provisional patent in September, 2010, and a Patent Cooperative Treaty Agreement the next year. A formal patent application was submitted April, 2013 on the technology that the Company will use in order to extract and upgrade crude oil.
The Company anticipates a net income of $10,084,000 in its third year post-funding The Company’s Management will accomplish this goal through acquiring land-leases on properties known to have substantial bitumen deposits. The business will then develop facilities on these properties with the intent to extract and distribute oil for sale onto the open market. The initial capital of $2MM sought in the business plan will allow the Company to acquire its first land leases while concurrently sourcing the equipment needed to operate. A more detailed description of the Company’s mission and vision can be found in the full Business Plan and also on the Company’s website.
Unique Value Proposition:
The Company founder invented the technology and has overseen its development to date. He began as an oil sands researcher for the Alberta Government, Oil Sands Research Department (AOSTRA) during the late 1970s and early 1980s. Through his expertise, and historical knowledge of Calgary’s oil sands, he will bring the operations of the business to profitability in its’ second year of operation.
Key Success Factors:
The key factor in the future success for the Company is the proprietary ultrasonic technology. Other industry participants will not pose a competitive threat since the technology will receive patent protection for a term of fifty years. This, along with conservative pricing of $25 per barrel will allow the Company to easily enter the marketplace. Additionally, since there is ongoing demand for crude oil, marketing costs will be moderate. The Company will develop sustainable relationships with pipelines which sell the oil to refineries.
Key Risk Factors:
Since Alberta is a province ruled by royalty there is a chance that industry stakeholders will not be treated equally in terms of incentive programs designed to benefit the local oil industry. This type of government can create uncertainty in terms of the future of the industry. This might drive up costs and encourage investment in other Canadian jurisdictions. Additionally, there is uncertainty as to whether a carbon tax will be imposed.
In order to complete the purchase of the leases to begin using the technology, the founder is seeking $2MM via a preferred stock offering. Most of this will be used to develop the leases for oil extraction. The Company’s exit strategy is to prove the commercial viability of the technology then license or sell the technology outright. As an alternative, the owners are willing to sell a majority position to investors interested in turning the company into an operating entity.
Crude Oil Production
2016 Projection: $27,000
2017 Projection: $1,862,000
2018 Projection: $16,425,000
2019 Projection: $21,900,000
Use of Proceeds
Funds will be used to purchase and develop leases, build installations and begin horizontal drilling. Additionally, proceeds will be used to procure the necessary tools and equipment along with covering operating expenses such as salary upstarts and well-site management.
Additional Documents Available
Business Plan, Executive Summary