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Insight: Value of Stress Field Detection technology in early-stage exploration
Friday, September 06, 2013
Findingpetroleum.com
Overview of Stress Field Detection (SFD®)
The SFD® system utilizes quantum-scale sensors to detect gravity field perturbations which are induced by terrestrial stress energy variations, primarily in the horizontal plane. Significant subsurface discontinuities or anomalies are inherently associated with, and dependent on, subsurface principal stresses. As a consequence, the discontinuities will distort stress fields, resulting in a unique in-situ stress pattern.
SFD® has been used by oil and gas companies to identify subsurface stress-field anomalies related to trapped fluids. This technology offers a leap in cost-effective rapid reconnaissance for early-stage exploration from an airborne platform.
Heuristic Explanation
The subsurface geological condition required for SFD® to detect gravity field perturbations which arise due to stress variations in the horizontal direction is the occurrence of a structural and/or stratigraphic change discontinuity with sufficient difference in elastic properties. An important source of elastic variations is the presence of trapped fluids (oil, gas, or water). Other sources include faulting / fracturing, over-pressure, major lithological changes and basin boundaries. In general, all major discontinuities will evoke a distinct SFD® response. The variation of the shear component around and in reservoirs will result in the redistribution and orientation change of the stress fields (Figure 1).
Figure 1. Plan view of principal horizontal stress components (SHmax and SHmin) illustrating the distortion of stress fields associated with fluids trapped in a structural thrust-fault scenario. Stresses are redistributed due to a variety of sources including porosity, trapped fluids, fracturing, faulting and reservoir pressure.
Differences with Conventional Gravity and FTG
Conventional gravity surveys measure the vertical component of the gravitational field. Full tensor gravity (FTG) gradiometry measures the rate of change of all components of the gravity tensor. Two major advantages of FTG over conventional gravity are the increased resolution and the reduced noise contamination of the signal. Both methods rely on a large test mass to increase the sensitivity in measuring subsurface density variations.
Both conventional gravity and FTG provide a static, point to point measurement. However, SFD® differs from both in that it employs particle scale sensor elements for dynamic detection, which enables selective sensitivity to directional changes in subsurface stress induced by poro-elastic anomalies.
Case Studies
Gulf of Mexico: Integration of Regional Geophysical Data with SFD®
The Gulf of Mexico has been an area of evolving exploration: from the continental shelf to salt-controlled basins to sub-salt and ultra-deep water plays. Covering vast areas in a cost-effective manner to identify prospective acreage is an ongoing challenge. Conventional wisdom has been to conduct regional 2D seismic surveys followed-up with 3D seismic, both sparse and detailed. Although seismic data provide high-resolution subsurface images the cost is significant. Airborne SFD® can provide a cost-effective rapid reconnaissance solution that identifies prospective areas for more focused follow-up seismic efforts.
In the Fall of 2012, PEMEX conducted an initial SFD® survey in onshore and offshore areas of the Gulf of Mexico region. Figure 2a shows a 2D seismic section from the Gulf of Mexico. The sub-salt structure appears to be encased in a sealing salt (purple) but there may be a breaching potential due to the marked faults.
The anomaly identified on seismic is verified by the SFD® anomaly (Figure 2b). This may be indicative of the presence of both trapped fluids and an effective sealing mechanism.The correlation of SFD® with seismic poses that in areas without seismic coverage, an SFD® survey could help propose where to put in a capital-intensive high-resolution seismic program.
Figure 2. Correlation of regional 2D seismic data with SFD®: a) Seismic anomaly PMX-2.16 and b) corresponding SFD® signal.
Furthermore SFD® is effective irrespective of the presence of salt or bathymetry. As such, SFD® can serve as an important complementary method to be used in conjunction with other exploration technologies.
While seismic surveys offer excellent resolution and structural definition, they do not always easily lend themselves to identifying fluid properties in the absence of additional information. New methods, such as controlled-source electromagnetics (CSEM), are becoming more accepted tools to investigate fluid indicators on qualified prospects. Figure 3 illustrates another Gulf of Mexico example correlating SFD® with CSEM high-resistivity anomalies associated with hydrocarbons. Figure 3a is a map of CSEM resistivity overlain by an SFD® survey line. There are two high-resistivity anomalies (dashed red ovals) identified as PMX-2.44 and PMX-2.15 which have corresponding SFD anomalies (solid red bars). The SFD® profile for PMX-2.44 is shown in Figure 3b. In this example, both CSEM and SFD® have identified potential fluid anomalies.
Figure 3. Correlation of regional CSEM data with SFD®: a) CSEM resistivity anomaly map with dashed red ovals Indicating high-resistivity anomalies at PMX-2.44 and PMX-2.15 and b) corresponding SFD® signal over PMX-2.44.
Colombia: Optimizing Lease Relinquishments with SFD
A common exploration challenge is to determine the best acreage to retain within a large lease. In 2010 NXT Energy Solutions conducted an airborne SFD® survey covering 7,500km2over the Tacacho and Terecay Blocks in Colombia for Pacific Rubiales.Figure 4a shows the approximately 7,000 line km of SFD®data (red lines) which were acquired, processed and interpreted to provide an evaluation in less than two months time. As a result of this rapid turnaround, the leaseholder was able to identify the areas to be relinquished. Figure 4b shows the retained areas in red outline. The SFD® anomalies are indicated in the blue boxes and the green outlines represent the client’s assessment of anomaly areas using other technical data acquired subsequent to the SFD® survey.
Figure 4. High-grading blocks for exploration: a) Blocks with flight lines (red) and existing seismic lines (black) and b) blocks containing the best SFD® anomalies and retained acreage outlined (red boxes). SFD® anomalies are identified with blue boxes and the clients assessment of anomalies using numerous G&G methods are indicated by green outlines.
Benefits for Early Stage Exploration
Rapid and efficient exploration reconnaissance over large areas of virgin acreage in an environmentally sensitive manner
Identification of prospect areas with potential trap, reservoir quality and seal integrity
Effective in both onshore and offshore environments
Insensitive to both water depth and the presence of salt
Prioritize exploration activity (e.g., seismic programs) on identified leads
Author: George Liszicasz, President & CEO
Company: NXT Energy Solutions Inc.
Read more: http://www.findingpetroleum.com/n/Insight_Value_of_Stress_Field_Detection_technology_in_earlystage_exploration/754fb970.aspx#ixzz2k0UqVC8h
NXT Energy Solutions
Locations of Completed Surveys
Over 250,000 Line Kms
http://www.nxtenergy.com/business_completed_surveys.php
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TSX-V: SFD, OTCQB: NSFDF A Canadian Public Company http://www.nxtenergy.com/
SFD® – a Dynamic Approach to Hydrocarbon Prospecting!
NXT’s airborne SFD® survey system enables our clients to focus and optimize their hydrocarbon exploration decisions on manageable, high-graded prospect areas with the greatest potential.
Fast-track the exploration process, and high-grade reservoir prospects with SFD®, the only remote sensing technique which can very rapidly identify trapped reservoirs, on a very cost effective basis.
SFD® is an airborne exploration survey method - this aids in minimizing the overall on-ground impact of exploration activities (seismic line clearing, etc) on both the environment and local communities.
A P R O V E N , I N N O VAT I V E T E C H N O L O G Y F O R
H Y D R O C A R B O N E X P L O R AT I O N
NXT Energy Solutions Inc.
is a service provider to the upstream Oil & Gas Industry:
NXT’s method will identify the best oil and gas prospects
Frontier exploration areas can offer the largest rewards but obstacles surrounding the acquisition of 2D regional seismic can stand in the way of making the best decisions in a reasonable timeframe. Even if you overcome the obstacles, a 2D seismic program is a costly solution. Acquiring conventional gravity and magnetic data provide a preliminary investigation of basement structures and sediment thickness but does not deliver information about reservoir. Optimal placement of seismic can mean the difference between relinquishing a block and drilling a discovery well.
SFD® represents a new generation of airborne geophysical surveys that can identify areas of reservoir potential within the sedimentary column, so you can focus your seismic programs and G&G resources on realizing it.
SFD® deliverables include a report which identifies and ranks areas for trap and reservoir prospectivity. SFD® interpretation results may be gridded to create a prospectivity map. Integration projects will ensure SFD® results are calibrated to existing G&G data.
Bidding Rounds
• While there is no time to acquire seismic prior to bidding, SFD® can evaluate the bid blocks and provide a competitive edge
• NXT has multi-client data available in Canada and Colombia
• Operators have successful utilized SFD® to replace part of their seismic commitment
• Colombia has approved SFD® to be bid for remote sensing commitments
Frontier exploration, licensing and technical evaluation areas
• Identify areas of best reservoir potential to focus seismic acquisition
• Enable decisions on purchasing or relinquishing lands
Re-evaluation of potential in mature areas
• Identify areas with remaining reservoir potential
• Focus resources and data purchase decisions
Lead generation and prospect evaluation
• Equally effective onshore and offshore
• Enables re-evaluation of seismic to envision other types of plays that would normally be bypassed
• Provide independent verification of reservoir potential
• Correlate to known reservoir analogs
• SFD® is equally effective across geologic settings
_________________________________________________________________________________________________________________________________
Survey Design
Each NXT survey is tailored to meet the clients needs.
Extensive joint planning ensures that;
• Grid density matches customer specifications
• Flight lines are created covering analogues
• Geological features (faults, facies changes etc) are taken into account
• These factors ensure both quality of data and comprehensive coverage of target areas and plays. Once completed, NXT provides a map of the planned flights (both hard and soft copies) as well as digital versions of the flight lines to integrate with the customer's software solutions.
Data Acquisition
NXT utilizes multiple Citation 560 series jet aircraft that have been modified to meet our survey requirements. These jets are well suited for international operations as they will provide required flying range. The surveys are flown at high speed (400 km/hr) and at an altitude of between 300-900 meters. Strict procedures are in place to insure the highest standards of safety and security during survey operation. During the data acquisition phase of a survey NXT follows strict flight parameters and vigorous quality controls to ensure the best quality of data. Preliminary results enable quick decisions on additional flight lines for verification or infill. Daily or weekly updates are presented to the customer to be kept abreast of our progress.
SFD Interpretation
Preliminary Interpretation Phase
The interpretation process starts with a blind interpretation so no bias is introduced. All anomalies are identified and ranked during this process.
Template cross-reference Phase
The purpose of this phase is to fine tune the initial interpretation. The integration of geologic knowledge may modify interpretation focus to better identify specific play types. NXT then catalogues all anomalies found in a survey area which are analyzed and turned into leads. Leads are then ranked according to prospectivity.
Customer input
NXT strives to work with our customer's G&G teams to include other geophysical data in the interpretation process.
SFD Integration
The modern explorationist uses numerous tools in the search for oil and gas. It is therefore important to be able to integrate all the outputs from these tools. NXT has years of experience integrating SFD data with other G&G data from prospect locations.
Final deliverables
The end result is a report detailing SFD leads with corresponding templates/analogues. A map showing locations and ranking of all SFD leads is included.
Industry Presentation: http://www.nxtenergy.com/sfd-technology/technical-presentation
Investor Presentation: http://www.nxtenergy.com/investor-relations/nxt-investor-presentation
______________________________________________________________________________________________
NXT’s goal is to continue expanding industry acceptance and use of our proprietary Stress Field Detection (“SFD”) airborne survey technology, and make SFD an integral part of our clients oil & gas exploration programs. Gaining repeat business from existing clients, and building on new case studies which showcase the capabilities of SFD in identifying reservoir prospects in varying geological settings is aiding in achieving this goal.
NXT is currently selling our aerial survey services on a fee for service basis (based on line km of survey data acquired). The business model can also expand to allow NXT the opportunity to generate additional revenue streams by acquiring proprietary speculative (“spec”) data for future resale in new survey regions flown, and participating in the success arising from survey data acquired, by way of:
Our target client base includes all of the major national oil companies (“NOCs”) which hold or take an ownership interest in the majority of unexplored acreage. Many of the NOCs are also active outside of their home country.
| Black Goose Holdings | Nexstar Energy |
| Blue Parrot Energy | Calpine Canada |
| Renaissance Energy | Camwest Exploration |
| Encal Energy | Result Energy |
| Infinity Oil and Gas | Rosetta Energy |
| EcoPetrol | Virtus Energy |
| Pacific Rubiales Energy | Hocol S.A |
Board of Directors
NXT’s Board of Directors currently consists of seven members, six of which are non-management, independent directors. The Board members have a diverse business background, and extensive experience with public companies, and with entities involved in oil and gas exploration and production.
NXT’s Board also has four independent Committees whose mandates are to advise the Board on various matters – the Audit, Compensation, Governance, and Disclosure Committees.
Mr. Liszicasz is the inventor of the SFD® technology and has been Chairman and Chief Executive Officer since the Corporation's inception in 1996. He was born in Hungary where he received his degree in Electronics in 1975, and later attended the University of British Columbia, studying physics and general sciences. Mr. Liszicasz is an inventor of a number of novel technologies, including electronic control systems, medical lasers and geophysical instruments.
Mr. Liszicasz’ primary responsibilities as the President and CEO are to oversee all operations and to further develop the SFD® technology. He joined NXT's Board in 1996.
Mr. Abougoush is a professional engineer with over 40 years of experience in the petroleum industry, largely in technical and executive positions. He is currently the chairman of Teknica Overseas Ltd., an international consulting company. He previously was chairman of SQFive Intelligent Oilfield Solutions Ltd., and also served as president of Teknica Petroleum Services Ltd., both international consulting and software development companies. He was formerly a director of CCR Technologies Ltd. and WellPoint Systems, Inc., both of which were public companies listed on the TSX Venture Exchange.
Mr. Abougoush joined NXT's Board in 2007 and is a member of NXT’s Audit and Governance Committees.
Mr. Agee recently retired following a 25+ year career in senior executive positions with various prominent US families, including the Carlson Family in Minneapolis, Minnesota (owners of Radisson, Country Inns and Suites, and TGI Friday's) from 2010 through February 2011, and the Steve Case Family in Washington, DC from 2000 through 2009 (Steve Case is the co-founder of America Online). Mr. Agee also served on numerous private, public, and non-profit Boards, and currently consults part-time in matters related to wealth management and is a CPA (inactive). He is a former director of Maui Land and Pineapple, a New York Stock Exchange listed company
Mr. Agee has a BA in economics and accounting from St. John's University, Collegeville, Minnesota, and a MBA from the University of Minnesota.
Mr. Agee joined NXT's Board in 2011 and is the Chairman of NXT’s Audit Committee, and a member of its Compensation and Governance Committees.
Mr. Selby holds a B. Sc. (Hons) in Chemical Engineering, a J.D. degree and is a registered professional engineer in the Province of Alberta. Mr. Selby is also the Chairman and CEO of Montana Exploration Corp., a TSX-V reporting issuer. He is the president of Caledonian Royalty Corporation and Caledonian Global Corporation, both private entities which are involved in oil & gas exploration and production. He is a former officer (1993 to 2010) of Pengrowth Corporation, which administered Pengrowth Energy Trust, a large North American energy royalty trust.
Mr. Selby has also previously been a director of several other Canadian reporting issuers.
Mr. Selby joined NXT's Board in 2006 is the Chairman of NXT’s Compensation Committee, and a member of its Audit and Disclosure Committees.
Mr. Tilson joined NXT's Board in February 2015.
Mr. Tilson obtained MBA and CFA designations and had a distinguished career as an analyst, portfolio manager, and advisor in the US investment and financial industry with such firms as Sutro & Company and EF Hutton & Company. John joined Roger Engemann and Associates in 1983 when assets under management were roughly US $160 million. During his tenure there, the Pasadena Group of Mutual Funds was started, with Pasadena Capital Corporation formed as the holding company for the mutual funds and investment management business. After working as an analyst and portfolio manager, John later became Executive Vice President & Managing Director of Pasadena Capital Corporation. Assets under management had grown to over US $5 billion by the time the firm was sold to Phoenix Companies in 1997. Mr. Tilson later retired in 2005. Mr. Tilson now resides in Montecito, California, and from 2006-2012 was a member of the Board of Trustees, including three years serving as VP and Chairman of the long-range planning committee, for Lotusland, a Santa Barbara non-profit organization established by Madame Ganna Walska.
Mr. Valentine is a Partner with the Calgary office of Norton Rose Fulbright LLP, and has practiced law, both as a Barrister and a Solicitor, since his call to the Bar in 1987. He is a member of the firm’s Global Resources Practice Group and is involved in energy and energy related matters throughout the Middle East, North Africa, the CIS, Asia and South America. He has extensive experience with international law and projects,
Mr. Valentine's work focuses on oil and gas projects, with an expertise in international LNG projects and developments. Mr. Valentine is a member of the Board of Directors of three other Canadian public companies, Calvalley Petroleum Inc., Veraz Petroleum Ltd., and Touchstone Exploration Inc
Mr. Valentine holds a BA from the University of British Columbia, a LLB from Dalhousie University, and a LL.M. from the London School of Economics.
Mr. Valentine joined NXT's Board in 2007 and is the Chairman of NXT’s Governance Committee, and a member of its Compensation Committee.
Mr. Vathyam is an independent businessman, and was previously (to October 2013) the Chairman and CEO of Petrodorado Energy Ltd., a Colombia focused junior oil and gas exploration and production company which he founded in early 2009. He also has extensive experience in international markets; having spent 23 years with Schlumberger, a leading global oilfield services company.
Mr. Vathyam joined NXT's Board in 2013 and is a member of NXT’s Compensation and Governance Committees.
The Advisory Board of NXT Energy includes geoscientists and other independent professionals whose experience is drawn on to assist in advancing industry awareness and use of the Company’s proprietary Stress Field Detection ("SFD®") aerial survey system.
Dr. George Iusco is based in Madrid, Spain, where he leads the New Ventures Group for Repsol YPF, a major international exploration and production company. He possesses over 30 years of exploration experience in the petroleum industry, and has held senior positions with Gulf Oil, Exxon, and Venezuela’s PDVSA. His extensive international exploration experience includes Venezuela, Mexico, Peru, Ecuador, Colombia, Trinidad, Central America, Argentina, Brazil, Kazakhstan, the Middle East, North Sea, West Africa, Alaska, the US Gulf Coast, and other areas in North America. He is an expert in evaluating complex structural and stratigraphic settings, integrating geophysical and geological technologies in order to detect, rank, and evaluate new prospective areas and formulate new exploration strategies. Mr. Iusco received a M.S. in Geology from the University of Bucharest and a M.S. in Geophysics from the Petroleum Institute in Bucharest, Romania.
Professor Cleveland Jones is currently with the National Oil & Gas Institue of Brazil, in Rio de Janeiro, and is involved primarily with research of innoviate oil & gas exploration technologies, assessment methodologies, and energy policy. He has consulted for international oil and gas companies worldwide, and is a sought-after academic commentator on energy policy issues.
Professor Jones graduated in Physics and Economics from Cornell University (Ithaca, NY), obtained a post-graduate degree in Oil and Gas Engineering, as well as a Masters and Doctoral degree in Geology, from the State University of Rio de Janeiro. Professor Jones is fluent in English, Portuguese and Spanish.
Dr. Arief Budiman is a faculty member with the Mechanical and Manufacturing Engineering Department at the University of Calgary, specializing in mechanics, phase transitions and materials science. He obtained a Ph.D. degree from the University of Toronto and is a Professional Engineer.
He is currently working with NXT in R&D programs to further develop understanding and acceptance of the SFD® technology within the oil and gas industry, including developing mathematical principles to explain and model the interactions between subsurface stress, gravity patterns, and the SFD® system.
George Allen served as Governor of the Commonwealth of Virginia from 1994 to 1998, and as US Senator from 2001 to 2007. Gov. Allen currently is Co-chair of the Competitiveness Initiative for the National Association of Manufacturers, Reagan Ranch Presidential Scholar for the Young America's Foundation, Ambassador of the Ass'n for Passive Optical LAN technology, and serves on several boards, including Armada Hoffler (AHH: NYSE), Nano Risk Assessment, Inc., and the National Ass'n for Jobs and Innovation. In 2009 he launched the American Energy Freedom Center, whose mission includes promoting American jobs, economic prosperity and competition in the development and use of America’s vast energy resources.
_______________________________________________________________________________________________________________________________________| (updated as of January 31, 2015) | in millions | |
| Common shares - issued and outstanding | 44.8 | |
| Convertible Preferred shares (convert on 1:1 basis, mature Dec 31, 2015) | 8.0 | |
| Additional shares reserved for exercise of outstanding | ||
| Stock Options (average exercise price $1.08) | 3.1 | |
| Fully diluted number of shares | 55.9 | |
| Directors & Officers / Insiders ownership position | Basic | 19 % |
| Fully Diluted | 32 % | |
| Debt outstanding | $ nil |
The convertible preferred shares are non-interest bearing, non-voting, and were issued in 2005 pursuant to the utilization of and acquisition of the SFD technology.
-V: SFD, OTCBB: NSFDFNXT may be followed by various investment community Analysts who periodically publish their coverage of NXT. Readers are cautioned that the following information regarding independent Analysts is provided as a service only. NXT believes but does not guarantee that the list of analysts is comprehensive. All of the analyst contact information has been posted with permission. Please feel free to contact them directly for information.
| Name And Company | Email and Website | Analyst Phone # |
|---|---|---|
| Raveel Afzaal, CFA | rafzaal@mackieresearch.com | 416-860-7666 |
| Mackie Research Capital Corporation |
Any opinions, estimates or forecasts made by Analysts regarding NXT's past, present or future performance are those of the Analysts alone, and may not necessarily reflect all facts or changes in circumstances. NXT does not by the reference herein imply its endorsement of or concurrence with such information, conclusions or recommendations.
NXT RECEIVES AWARD OF A NEW SFD® CONTRACT OF US $13 MILLION CALGARY, ALBERTA, April 16, 2015 -
Forward-Looking Statements
This news release may include forward-looking statements. When used in this document, words such as “intends”, “plans”, “anticipates”, “expects” and “scheduled”, are forward-looking statements. Forward-looking statements are subject to a wide range of risks and uncertainties, and although the Company believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of factors can cause actual results to differ materially from those in the forward-looking statements. Risk factors facing NXT are described in its most recent MD&A for the year ended December 31, 2013 which has been filed electronically by means of the System for Electronic Document Analysis and Retrieval ("SEDAR") located at www.sedar.com. Such forward-looking statements are made as at the date of this news release, and the Company assumes no obligation to update or revise them, either publicly or otherwise, to reflect new events, information or circumstances, except as may be required under applicable securities law.
For further information contact:
| Greg Leavens, VP Finance & CFO | George Liszicasz, President & CEO |
| NXT Energy Solutions Inc. | NXT Energy Solutions Inc. |
| Tel: (403) 206-0805 | Tel: (403) 206-0800 |
| Investor Relations |
| KIN Communications Inc. |
| (604)684-6730 / 1-866-684-6730 |
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) nor the OTC Exchanges accept responsibility for the adequacy or accuracy of this release.
_______________________________________________________________________________________________________________________________________
Contacts:
NXT Energy Solutions Inc.
505 - 3rd Street, S.W., Suite 1400
Calgary, Alberta Canada T2P 3E6
Phone: (403) 264-7020
Fax: (403) 264-6442
Email: nxt_info@nxtenergy.com
Transfer Agent & Shareholders Registrar
Computershare Trust Company of Canada
(formerly Olympia Trust Company)
Suite 600, 530 - 8th Avenue SW
Calgary, Alberta Canada T2P 3S8
Phone: (403) 267-6800
Fax: (403) 267-652
