Geologist
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Thanks deesil, SB12 & Enzero. Last Friday, I felt that my investment with STWA was on shaky ground after reading GEC's reports. Your three more detailed and thorough reports posted in succession this weekend set my mind at ease.
I have way too many shares already, with each drop of one penny I see my stock value drop by $1,600 US. I trust that STWA will use our money wisely and that we will see a reversal in the very near future.
Yes the plot thickens.. and we are left wondering with share priced at 33 cents.
I think it is normal to do some soul searching... especially since the 'risk/reward' journey has been ongoing for years. We, as a group, seem to be in agreement about the nature of this risk. We should discuss possible outcomes as this SHM approaches. The 9 June 2015 will bring news regarding a possible award (Innovation in Technologies). This news, if positive, could reach Wall Street. We may witness a share price reaction similar to the September 2012 SHM, where the share price jumped above $1.50. Assuming there is no other great news at the SHM in Hawaii, it is possible that the share price will return to the 40 to 60 cents range as we continue to watch the paint dry and wait for positive commercialization news.
What do we do the next time it reaches $1.50?
a) We ride it out as I did in 2012
b) We sell half of our shares and hope for a chance to get back in at 50 cents.
FML2013
Great post Zerosum
I will print copies for all the people who have bought ZERO, in the last four years, based on advice I gave them.
Some are wondering what to do with their shares especially since hearing of the SHM location. Your post puts everything into perspective.
I agree with Moora9, because if Gregg Bigger does not announce great news between now and the SHM, he is going to be a very unpopular guy on IHUB. He is smart enough to know this.
The Innovation in Technologies Award relates to a project, product, service or new R&D business model. With an emphasis on high impact disruptive innovation rather than incremental iterations of current technologies, nominations are open for those that have invented, developed and are deploying a brand new concept, process, device or business approach that will have major impact in terms of one or more of energy efficiency, emissions, economics, HSE, schedule or quality and practical considerations.
I would be worried if STWA was not on the list for this award. This is not fluff, this is real
JUDGING CRITERIA
1. Identification of a major advance in the development of the new technology an demonstration of its disruptive potential
2. Significant contribution to overall knowledge based technology, locally (how is it developed locally, R&D established to develop and transform the technology in light of further local development)
3. Original concept and application of the new technology
4. Innovation benefits to the oil & gas industry and to society
5. Accomplished impact in comparison to the size of the project, product or service
6. Organizational and financial commitment towards technology research, development, and its commercial potential
Thank you Earth1, I am impressed by how clear and thorough you analyzed all angles of this topic.... WOW. I have copied your post and saved it in my STWA folder alongside other gems collected over the years.
Looking forward to your next post.
Myrka
Alkaline, I think Earth1 has settled our lengthy discussion on increased flow in a pipeline. I like the way he answered your question using incompressible flow terminology, while I was trying to explain the need for a constant flow using the conservation of mass. So thank you Earth1 for clearing that up.
Mr Sano
I would like to bring to your attention an interesting article by B. R. Sutherland, D. Van Vliet, K. Dohan and T. B. Moodie from the Department of Mathematical Sciences, University of Alberta, Edmonton, AB T6G 2G1, Canada
I am not sure what to say at this point. We know that turbulence increases the friction against the pipeline wall, which is directly related to the pressure drop and head loss during flow through these pipes. The pressure drop is then used to determine the pumping power requirement.
Under most practical conditions, the flow in a circular pipe is laminar for Reynolds <2300, turbulent for Reynolds at 4000, and transitional in between. A lower Reynolds number means the pumps work less. The flow in a pipe is streamlined at low velocities but turns chaotic as the velocity is increased above a critical value. The transition from laminar to turbulent flow does not occur suddenly; it occurs over some region in which the flow fluctuates between laminar and turbulent before it becomes fully turbulent.
Thank you for this Mr. Sano. Doing a little bit of research, I found that most flows encountered in practice are turbulent. I gather we can now conclude that turbulent flow in the AOT is not that much of an issue.
That's a good question for the engineers that designed the system.
I am sure they spent many hours trying to perfect the AOT in order to keep the Reynolds number under 2300.
Although the theory of fluid flow is reasonably well understood, theoretical solutions are obtained only for a few simple cases such as fully developed laminar flow in a circular pipe. Therefore, STWA and the engineers at TC had to rely on experimental results and empirical relations to test the AOT rather than closed-form analytical solutions. These results were verified by the INDEPENDENT 3rd party company ATS Rheo Systems and were found to be positive.
It will be interesting to see how "positive" when we get access to the actual results.
For a specified flow rate, the pressure drop and thus the required pumping power is proportional to the length of the pipe and the viscosity of the fluid, but it is inversely proportional to the fourth power of the radius (or diameter) of the pipe. The pumping power requirement for a piping system can be reduced by a factor of 16 by doubling the pipe diameter. Poiseuille’s law (J. Poiseuille 1799–1869).
Then when the oil returns to the pipeline after the AOT, the oil enters a smaller diameter. I believe the change in viscosity will make a difference. The AOT tested was developed and refined by STWA & TC, I assume they designed it to maintain laminar flow throughout.
I agree.
Zerosum and zerosnoop, your intentions are good but no longer effective. I appreciate and normally look forward to your input. You do not belong with the IGNORE bunch who also constantly repeat the same thing.
I vote for energy independence in North America and STWA will help us get there... JE SUIS CHARLIE!
Alkaline
These are AISI numbers posted 21 March 2014
Post # 7351
I don't think I have articulated strongly enough just how important our first glimpse of profit margins really is.
Talk of CGS and SG&A is something only accountants would love. However, for every holder of STWA stock that is wondering if we really can see our stock price soar, this type of gross profit margin is an enormous stride toward an affirmative yes.
Here is a very simple hypothetical example why:
Assume selling price skid of four AOTs - $4,300,000
Assume cost of goods sold per skid - $1,200,000
Gross margin is (4,300,000 - 1,200,000)/4,300,000 = 72%
If 25 AOT skids of four were ordered the gross profit would be
25 x $4,300,000 = $107,500,000 x .72 = $77,400,000
If gross margins were only 30% or even 50% you can see what a huge difference that would make to gross profit.
At this point I can only guess what net profits would be for the above example, but gross margins this high or higher are very promising. The expense side would include payment of royalties to Temple University, SG&A, and taxes.
To the extent that STWA can bring down the manufacturing costs with a larger production run and/or increase the sales price of the AOT, margins will expand. Taxes probably won't be a problem for awhile as we should have plenty of tax loss carry forwards.
Now all we need is for the Midstream AOT to fulfill it's promising outlook.
As a point of reference the gross profit margin of the S&P 500 is approx. 38%. The net profit margin of the S&P 500 is approx. 8.5%.
AOT versus existing flow-assurance technology
Wen160,
Thanks
Smile AOT Works for bringing to light strong statements confirming the potential of the AOT.
SoxFan, I usually skip over your posts. But my eye caught the words 'custom unit'
I need to correct something I say in my last post.
Moorea9, if Alkalinesolution1's last post is right, with each AOT the pumps would gradually adjust to put through more oil for the same amount of liquid horsepower. This would be possible because of the incremental pressure drop with each AOT.
BUT
Lets say we know that each pump is good for the next 40 miles and each AOT is good for the next 40 miles. The last 40 miles segment on a 1,000 miles pipeline (with 25 stations) is missing an AOT. The reduced head loss would create a bottleneck. Therefore the last pump would have to be running at a lower throughput. Because of the law of conservation of mass, that pump would dictate the behavior of all the upstream pumps. Maybe we should be saying that the weakest link or the biggest bottleneck or the largest head loss dictates the system flow rate.
Lets consider a 1,000 mile long pipeline with 25 pump stations and 26 segments. Very little head loss other than pipe fittings and a few bends. The company installs an AOT at the 13th pumping station. Result is a reduction in head loss because the viscosity in the 13th segment of the pipeline is lower than all other segments. The 25 other segments are now bottlenecks to the entire system if we wanted to increase the flow rate.
Conclusion; the company needs to install an AOT at each pumping station to match the head loss reduction at the 13th station. Could this kind of installation give the company an increased flow rate of 10% to 15%?
Alkalinesolution1, I wont comment on all of your last post because I think you regret some lines. Lets just say that a fundamental principle of classical physics is that matter cannot be created or destroyed in an isolated system.
Hy Guys I see that you are at it again. That means you are not sure and want to explore a little further.
TC installed an AOT on an existing pipeline, at a location where the AOT would help with a bottleneck. I am not sure of this, but I have read somewhere that this is the case.
The laws of nature state; if you want something you have to pay for it. In a pump, liquid horsepower ($$$) is inputted and converted to velocity energy by the impeller, then converted to pressure energy in the diffuser section of the volute case to push liquid through the piping. An energy or pressure difference must exist to cause the liquid to move. A portion of that energy is lost to the resistance to flow. This resistance to flow is called head loss due to friction.
Factors that affect Head Loss (i.e. bottlenecks)
1) Flow Rate
When the flow rate (GPM) increases, the velocity of the liquid increases at the same rate. The friction or resistance to flow (due to viscosity) also increases. The head loss is related to the square of the velocity so the increase in loss is very quick.
2) Inside diameter of the pipe
When the inside diameter is made larger, the flow area increases and the velocity of the liquid at a given flow rate is reduced. When the velocity is reduced there is lower head loss due to friction in the pipe. On the other hand, if the inside diameter of the pipe is reduced, the flow area decreases, the velocity of the liquid increases and the head loss due to friction increases.
3) Roughness of the pipe wall
As the roughness of the inside pipe wall increases so does the thickness of the slow or non-moving boundary layer of liquid. The resulting reduction in flow area increases the velocity of the liquid and increases the head loss due to friction.
4) Corrosion and Scale Deposits
Scale deposits and corrosion both increase the roughness of the inside pipe wall. Scale buildup has the added disadvantage of reducing the inside diameter of the pipe. All of these add up to a reduction in flow area, an increase of the velocity of the liquid, and an increase in head loss due to friction.
5) Viscosity of the liquid
The higher the viscosity of the liquid is, the higher the friction is from moving the liquid. More energy is required to move a high viscosity liquid than for a lower viscosity liquid.
6) Length of the pipe
Head loss due to friction occurs all along a pipe. It will be constant for each foot of pipe at a given flow rate. The published tables have head loss values which must be multiplied by the total length of pipe.
7) Fittings
Elbows, tees, valves, and other fittings are necessary to a piping system for a pump. It must be remembered that fittings disrupt the smooth flow of the liquid being pumped. When the disruption occurs, head loss due to friction occurs.
8) Straightness of the pipe
Because of momentum, liquid wants to travel in a straight line. If it is disturbed due to crooked pipe, the liquid will bounce off of the pipe walls and the head loss due to friction will increase. There is no accurate way to predict the effects since “crooked” can mean a lot of things.
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So Alkalinesolution1, when you referred to a pipe "Flat, Up, Flat" you are introducing a bottleneck to the pipe. When you add the AOT to the mix, you get a pipe "Flat, Flat, Flat". So The AOT removes the bottleneck or some of it by reducing the head loss. The pump does not have to work as hard, but it is still working with the same pressure difference but now there is less head loss. The savings is in the liquid horsepower needed to run the pump.
OK, so now TC have reduced the head loss with several AOTs located where the worst head loss occurred (bottlenecks). Now, they would like to increase the flow rate, so they install an AOT upstream and increase the pump throughput to match the reduced head loss because of lower viscosity. But, then 40 miles down the pipeline, at the next pumping station they encounter a new bottleneck because the effect of the first AOT is no longer active. The viscosity has returned to the original state. The pump is working to maintain the new flow rate, but it will overheat because of the head loss 50 miles downpipe. So an other AOT will have to be installed to remove that bottleneck.. and so on, down the line. Conclusion: you need AOTs from pipeline start to pipeline finish in order to increase the flow rate.
Sorry Alkaline, I do not want to discuss this again, but I think you and I can agree on certain basic principals. We both agree with the content of your posts (#6207 & #6212) with info from Dr. Tao and his interlocutor.
I urge you to read very carefully post #6212 and think about the following sentence:
Thank you Smile AOT works
When STWA first entered into a NDA with KM they (STWA & KM) were unaware that TC was to terminate the lease. So they had to be planning for the use of the very first AOT (Midstream serial # 000001). But then why do they need 4 months for delivery?
On the other hand, if they knew that TC was to terminate the lease before it was announced, then they must be talking (TC & KM). For KM to go ahead with the NDA, we can assume that the AOT performance is good and that they have made arrangements to use part of the AOT skid. That would explain the 4 months needed to deliver the AOT to KM (2 months on TC pipeline, 2 months to modify & deliver).
Check Zizek post #9680
Moorea9, very interesting, I would like to bring to your attention a post by Zizek (#9731) on 22 July
Is it not time for STWA to issue a shareholder's update?
FORM 10-K (Annual Report)Filed 03/17/14
STWA strategy includes:
1. Finalize manufacturing of our AOT Midstream commercial product line.
2. Complete the multiple certification processes for our AOT Midstream commercial product line.
3. Continue developments for implementation of our AOT Midstream product for commercial use.
4. Gain clearance from customers’ procurement divisions for installation of AOT Midstream products into their operations.
5. Publish material events, collaborative arrangements, framework agreements and joint development agreements.
6. Co-Present with customers at various trade conferences in the United States.
7. Continue to make inroads and meet with key strategic potential customers in the following geographic regions: Alberta Canada, Williston Bakken Basin USA, Niobrara Denver-Julesberg Basin USA, Uinta-Piceanse Basin, Green River Basin, West Africa, Asia, Austral-Asia, South America.
8. Continue to make inroads and strategic alliances with additional supply chain and logistics support to rapidly expand our production capacity beyond its current physical limitations, adding capacity, reach and stability with pre-approved supply
chain members that meet the criteria of the customers’ procurement divisions.
9. Further develop two additional AOT product models beyond the AOT Midstream for reach into the upstream and gathering energy production and transport sectors.
10. Continue to develop collaboratively additional scientific and technical whitepaper reports, product development
enhancements, and additional products with our engineering support, consultants and relationships.
STWA could release a shareholder update on how each of these 10 strategies are progressing. Can some be checked off as completed?
We know that Warren Buffet has been sinking money into the railroads and that does not help STWA. Could STWA develop an AOT to fill and empty tanker cars. That would get Warren's attention and money. Maybe that's what they are working on as mentioned in strategy #9, we need to know more. I am afraid we have been loosing a lot of long time shareholders.
JT at 11:29 AM I bid $0.77 for 12,600 shares, it was filled and shows up in the real-time streaming as a SELL. How is that possible? I realize somebody sold those shares, but they should also show up as a BUY.
I think we all agree that TC is not going to share with the world results from the AOT installed on their pipeline. But, if and when they order another AOT, that would be the sign that would inspire confidence that the AOT can deliver. That's the news we need, the situation with the nine NDAs will not change until this happens.
Nice having you around JT, at least we know what is happening in MM world. Picked up 12K shares at $0.77 today. I like my new average.
Alkaline
You have my coordinates, keep me in the loop
Myrka
Thanks for the insight J.T.
I agree
That's great, I stand corrected.