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Seriously? Nobody is shorting Qsep aside from an MM. That is just a old made up excuse in an effort to deflect attention from the technical and fundamental problems that have plague this company for over a decade.
All of this is just Qsep double talk that’s been honed to a fine constancy and strategically employed to stem the blood letting or at least stretch out the carnage over the next few Qs. I must say for what reason that escapes me It’s quite effective in the short term.
I’m sure there will be a fresh new round of updates as Qsep keeps throwing out excuses and fluffy smoke screens to prop up the pps but it doesn’t negate the fact that there are entire areas of mathematics devoted to control theory. A device using this type of treatment would need a very complex controller not simply a power supply that turns on and off. Added a variables such as feed stock composition and the control algo might need a cray super computer to run the magic pipe! It’s oversimplification of this latest issue that is a classic tell that been floated before.
If after a decade of trying to prove out the magic pipe you would think they would have worked out the most basic mechanical and electrical engineering problems by now! They haven’t come close and obviously this announce just bought themselves another Q+ of time but it’s nowhere near enough!! The idea that Qsep will legitimize its efficacy claims in just a few weeks after it can actually turn on is another fallacy. Field testing goes on for months! Who knows what corrosive forces are generated by this device or potential for it to short or act “erratically”.
Yep the whole concept that an ever changing “batched” feedstock of crude will suddenly behave like a specially engineered rheological fluid that behaves opposite of what is seen in nature at different temperature and climate conditions.
Qsep management must believe investors will never check its history of excuses and solutions for its Testing failures
From 10K
https://www.sec.gov/Archives/edgar/data/1103795/000101968715000976/stwa_10k-123114.htm
On August 1, 2013, the Company entered into an Equipment Lease/Option to Purchase Agreement (“TransCanada Lease”) with TransCanada Keystone Pipeline, L.P. by its agent TC Oil Pipeline Operations, Inc. ("TransCanada") which agreed to lease and test the effectiveness of the Company’s AOT technology and equipment on one of TransCanada’s operating pipelines.
Under the TransCanada Lease, TransCanada installed and tested four AOT Midstream pressure vessels with a cumulative maximum flow capacity of 20,000 gallons per minute. As part of the testing process of our AOT Technology on the TransCanada pipeline, we received a report (“Report”) from an independent, third-party laboratory (“Laboratory”), hired by the Company. The Laboratory performed tests and analysis on crude oil treated by our AOT Equipment at the TransCanada pipeline facility where our equipment was installed under typical operating conditions. The analysis was conducted to determine the effectiveness of our equipment in reducing the flow of viscosity of crude oil flowing through the TransCanada pipeline. Among other things, the Report determined that data indicated treatment of the crude oil flowing through the TransCanada pipeline using our AOT Technology reduced the viscosity of the crude oil. The Report also determined that the efficacy of our AOT Technology was constrained due to the limitations of the electric field applied by the power supply installed on our equipment, concluding that maximum viscosity reductions could be achieved by modifying the installed power supply. We are encouraged by the results and data analysis arising from the testing of our AOT Technology under commercial operating conditions. We look forward to further development and commercialization of our technology. In June 2014, the equipment was accepted by TransCanada and the lease commenced. The TransCanada Lease was terminated by TransCanada, effective October 15, 2014.
2013 Qsep reports that the TCPL beta had a “constrained” power supply due to limitations of the power supply. Solution is boost the power supply. HMMMmmm heard that one before!
https://www.sec.gov/Archives/edgar/data/1103795/000101968716005472/qsenergy_10k-123115.htm
On July 15, 2014, the Company entered into an Equipment Lease/Option to Purchase Agreement (“Kinder Morgan Lease”) with Kinder Morgan Crude & Condensate, LLC (“Kinder Morgan”) under which Kinder Morgan agreed to lease and test the effectiveness of the Company’s AOT technology and equipment on one of Kinder Morgan’s operating pipelines. Equipment provided under the Lease includes a single AOT Midstream pressure vessel with a maximum flow capacity of 5,000 gallons per minute. The equipment was delivered to Kinder Morgan in December 2014 and installed in March 2015. In April 2015, during pre-start testing, low electrical impedance was measured in the unit, indicating an electrical short. A replacement unit was installed May 2015. The second unit also presented with low impedance when flooded with crude condensate from Kinder Morgan’s pipeline. Laboratory tests previously run on at Temple University on condensate samples provided by Kinder Morgan indicated the condensate was non-conductive; however, the condensate is known to have a relatively high density of semi-conductive particulate matter suspended within the fluid. Similar conditions were experienced in earlier prototype tests at the Rocky Mountain Oilfield Testing Center (“RMOTC”). At RMOTC, the pipeline had a high concentration of highly conductive particulate matter, which tended to concentrate at the base of the AOT when installed horizontally, causing the AOT to present with an electrical short. This issue was solved at RMOTC by converting to a vertical configuration, which allowed the particulate matter to flow naturally through the AOT. Based on experience at RMOTC, Dr. Tao expressed a high level of confidence that converting to a vertical configuration will resolve the issue of conductive particulate matter.
In June 2015, QS Energy engineers performed a series of tests and internal inspections on the AOT unit, which identified other potential design issues that could impact electrical impedance. Based on these findings, a number of internal components of the AOT were retrofitted or remanufactured to improve both efficacy and efficiency. The remanufactured AOT unit was delivered to Kinder Morgan facility in Texas and was installed in its new vertical configuration in July 2015. Installation and pre-start safety tests were successfully completed and preliminary testing initiated in August 2015. Initial results were promising, with the unit operating generally as expected. However, voltage dropped as preliminary tests continued, indicating decreased impedance within the AOT pressure vessel. QS Energy personnel and outside consultants performed a series of troubleshooting assessments and determined that, despite modifications made to the AOT, conductive materials present in the crude oil condensate continue to be the root cause of the decreased impedance. Based on this result, QS Energy and Kinder Morgan personnel mutually agreed the best course of action was to hold on final acceptance of equipment under the lease and temporarily suspend in-field testing to provide time to thoroughly test samples of Kinder Morgan’s crude oil condensate in a laboratory setting.
In 2015 another familiar excuse as Qsep reports KM test is shorting to ground due to conductive material within the crude oil (lease condensate) Solution: Temporarily suspend operation and do additional lab testing.
https://www.sec.gov/Archives/edgar/data/1103795/000168316817000736/qsenergy_10k-123116.htm
Southern Research Institute (SRI) was engaged by QS Energy in 2015 to investigate the root cause of the crude oil condensate impedance issue by replicating conditions experienced in the field utilizing a laboratory-scaled version of the AOT and crude oil condensate samples provided by Kinder Morgan. In addition, QS Energy retained an industry expert petroleum pipeline engineer to review the AOT design and suggest design modifications to resolve the crude oil condensate impedance issue. This engineer has studied design details, staff reports and forensic photographs of each relevant AOT installation and test. Based on these investigations, specific modifications were proposed to resolve the impedance issue, and improve the overall efficiency of the AOT device, resulting in a new value-engineered design of certain AOT internal components.
Problem fixed!
In December 2015, the Kinder Morgan AOT unit was retrofitted with the value-engineered internal components at Industrial Screen and Maintenance (“ISM”), one of QS Energy’s supply chain partners. Tests performed by ISM on the re-engineered unit demonstrated improvements in system efficiency and a significant increase in internal impedance. Tests performed on an unmodified AOT measured impedance at approximately 200 mega-ohms of resistance. Under similar conditions, the re-engineered AOT measured more than 20,000 mega-ohms; a 100 times increase in impedance. As modified, the AOT needed only 500 to 800 nano-amps to achieve a test voltage of 15,000 volts. These design modifications, specifically designed to address impedance issues experienced in the Kinder Morgan condensate pipeline tests, have the potential of improving efficacy and efficiency in crude oil pipeline operations as well. The increased efficiencies measured on the re-engineered unit has the potential to mitigate the need for a larger power supplies as experienced on operations on TransCanada’s high volume crude oil pipeline. The re-engineered AOT unit was delivered to and installed on the Kinder Morgan condensate pipeline in February 2016, with testing scheduled begin in March 2016.
In February 2016, the modified AOT equipment was installed at Kinder Morgan’s facility. Pre-acceptance testing was performed in April 2016, culminating in more than 24 hours of continuous operations. In-field viscosity measurements and pipeline data collected during this test indicated the AOT equipment operated as expected, resulting in viscosity reductions equivalent to those measured under laboratory conditions. Supervisory Control And Data Acquisition (“SCADA”) pipeline operating data collected by Kinder Morgan during this test indicated a pipeline pressure drop reduction consistent with expectations. Kinder Morgan provided the Company with a number of additional crude oil samples which were tested in the laboratory for future test correlation and operational planning purposes. Based on final analysis of in field test results, SCADA operating data and subsequent analysis of crude oil samples at Temple University, Kinder Morgan and QS Energy are considering moving the AOT test facility to a different, higher-volume pipeline location.
But wait AOT has been fixed as evidenced by all of the above claims of engineered solutions yet KM runs it for a measly 24 hours of testing then abruptly stops....then QSEP reports KM is considering moving it??? Something is rotten in Denmark! No company that saw a benefit would pull it that quickly
Southern Research Institute (SRI) was engaged by QS Energy in 2015 to investigate the root cause of the crude oil condensate impedance issue by replicating conditions experienced in the field utilizing a laboratory-scaled version of the AOT and crude oil condensate samples provided by Kinder Morgan. In addition, QS Energy retained an industry expert petroleum pipeline engineer to review the AOT design and suggest design modifications to resolve the crude oil condensate impedance issue. This engineer has studied design details, staff reports and forensic photographs of each relevant AOT installation and test. Based on these investigations, specific modifications were proposed to resolve the impedance issue, and improve the overall efficiency of the AOT device, resulting in a new value-engineered design of certain AOT internal components.
Again....another clear example of management twisting the truth so that they continue doing what they do best. Selling paper! How many times they claimed they had the fix with this so-called "Value engineering" WTF is that??? How about just good old basic engineering that works!!! Now a whole new series of excuses aimed at confusing investors into believing all is well...nothing to worry about. Yeah..
“Dr. Gallagher commented, “I remain highly encouraged by the opportunity, and we have been proactive while dealing with the recent hurdles. Although we have experienced some delays, the AOT represents a transformational technology in its potential to replace traditional diluents. I am pleased to be part of this team, and I look forward to assisting further in the demonstration project along with preparing for commercialization.”
Maybe someone should tell the good doctor that Aot claims only to REDUCE diluent amounts to the tune of a maximum 10-15%. In no way does the magical pipe reduce them to the point where they are no longer necessary.
Management claims they have enough cash for opex through Nov but at current burn rates, they have already consumed close to 50% and only 45 days remain. That would cover them through Sept not Nov as reported. That is without accounting for added cost from this latest round of technical musical chairs! Qsep needs at minimum 10M to pursue any real rollout of its service or its products ....I don’t see a clear strategy here on how they expect to raise that money or continue operations while they try to figure it all out.
2Q cash position $711,000
subseq raise $69,000
total $780,000
at cash burn $8333/ day 92 days from June 30th
Sustained operation for a “paid for” test...big whoop never will support multi dollar pps or a mktcap close to a billion dollars!!. It current valuation is still 200-300% higher than where it should be.
On another note I see the 500k prepayment that was rumored to be a refundable oilco “insurance policy” has now been expensed to the tune of 450k. So basically poof it’s gone!
No sane company would pay 60M dollars for QSEP. They would need to show ramping sales and expanded product lines of its alleged technology. That not happening anytime soon.
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I can guarantee you you won't be seeing that. I would be buying a couple million at .05 if it ever got down there, but it won't.”
Lol.,.I can guarantee that Qsep can make no guarantee of anything. They are out of altitude, airspeed and ideas! The carnage is just beginning!
Yeah he gets paid to be confident!
Another complete line of bull. Nobody is buying these excuses. They have reported that the crude at this unknown facility is of higher conductivity. The magic pipe will NOT be changing that anytime soon. Strapping a power supply with a greater output also does not change that reality and they admit they don’t know what exactly is the issue and Aot may require additional internal engineering just to turn on! The 10q reports the secondary supply was also exhibiting above its spec current draw and while they don’t think “leakage” has occurred they don’t know for sure! High voltage leakage within a flammable liquid is a bad thing!
Plans mean nothing. Qsep has had “grand plans” for saving the world for 21 years! It’s a giant bull crap sandwich and management hope all take a giant bite! I doubt many will at this point.
Fluffery they have major issues and have known for quite a while. Just another example of how the behavior and effectiveness of management has not materially changed. Past due debt to Temple for licensing fees is now over 1 million and accruing a “penalty interest” of 10%! Cash burn is over 8k a day..and they no zero revs and only source of funds is convertibles with warrant chasers.
“They already have solutions to the conductivity aspect and are implementing them now. They could have data within 2 weeks of starting testing which again is starting in August. They clearly said this in the PR/update.
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Better read it again. Management has deflected until q4. They are no doubt going to redesign the interior and this will take way longer than any insider will admit. Btw they supposedly “solved” every problem they encountered to date except how to get customers and sales. That’s the 10 megaton elephant in room.
Oh...I’m sure it coming...after all why would a unnamed Fortune 500 company be interested in little old Qsep if they weren’t assured of the companies efficacy of its darling “proven” product(s).
“However, based on our most recent laboratory tests, we believe it is likely the repaired power supply will be insufficient to treat crude oil; in which case we will use in-field operations to test, confirm and supplement our laboratory test results.”
Oh lord....this just keeps getting worse with every word that management prints! The “not ready for prime time AOT” will take years to reengineer and the result will again be fools gold. I wonder how long the investment community will allow this current round of managers to keep blowing timelines! Thank god Qsep is not in charge of missile defense !
This is just management squeezing drops of hope out of another disastrous result. How long has Qsep know about issues???? Clue Look at the recent consultant hire!
Yep it is the “kicking the can down the road strategy” and it has been employed for a decade. Old Qsep doesn’t need to show efficacy only that it’s “working” on the magic pipe. It’s been the same story year after year. Embedding an anode /cathode within a flow of potentially explosive crude is IMO a flawed concept to begin with. If Qsep wants to pursue this configuration they will need insulate the anode/cathode from the flowing feedstock and the containment vessel. How this would be accomplished is the $64k question. Connected hollow insulated rods might work but it would take up a great portion of the internal vessel so I imagine AOT 4.0 just got supersized!
Water in the cell, oil too conductive...busted power supply on transit ...the horror!
The good news is that last Q QSEP only burned $8000 a dollars a day. Keep up the good work!
More technical issues from not so Quick Strike!
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Repairs to the power supply were completed in early August 2019. We plan to install the repaired power supply and test the AOT unit at higher power in August 2019; however, based on recent laboratory tests, we expect conductivity of the crude oil to inhibit the AOT’s ability to reach sufficient voltage to fully treat the crude oil. We are also working with the power supply vendor to assess power supply configurations to increase the power output and to match a new power supply to the design of a new grid pack and the target oil. We are also working on modifications to the internal configuration of the AOT grid pack to reduce power requirements when treating highly conductive crude oil. Once we complete the next round of full-scale testing at the demonstration site, we will determine if modifications are required. Our next course of action will be determined at that time. Based on current plans, required modifications, if any, should be installed and ready for testing in the fourth quarter of 2019.”
Relevant 2014 post from VALUEYODA that sums up the QSEP saga.
"Sure, an order of $50mln would change the perception of investors with regard to the stock - justified or not. However, valuation requires not a single order but a sustainable level of recurring revenues and resulting cash flows instead of one off orders. I wouldn't want to be caught long. So far, everyone keeps reminding everybody what progress the company has made. Fact remains that nobody pulls the trigger on actual orders and the company continues to burn through cash. All deals so far were mere tryouts with little financial consequence for those companies and all order alliances that STWA has formed in the last 6 months are neither revenue generating nor will have any financial impact any time soon, while the dilution keeps chipping away at the "pot of gold". By the time that investors will see any actual orders coming in that will make the company cash flow positive, this company will have sunk lower than Atlantis.
Nobody of the long term holders have made any money on this stock, and probably losed quite a bit on paper the last 2 years. Fact remains that this company is getting close to brink if nothing material (not referring to meaningless alliance news flashes) happens very shortly. The company witnessed in November after the release of the 10-q how quickly stock prices can reset lower on only a few sellers. If no orders materialize by the next filing, the stock price will reset lower below warrant and option strike prices, causing a cash crunch."
Q due today. Facts and figures will tell the story!
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These are are clues that I look for in the OTC for the potential of a tiny nano cap security to become something more. QSEP has these things in spades”
Nonsense! Qsep has been doing victory laps for a decade. Every time they get a test, even if it fails or the client refuses to pay they report it as being successful and add it to basket of “clues” that amounts to nothing more than a bowl of steam!
The only thing disruptive is the ability of the Giant White Pipe to keep extracting cash from unsuspecting investors. Nobody cares about all these concocted extrapolations and made up excuses. Legit companies put points on the board and dollars in the bank so investors can actually smell the business. The only thing I'm smelling is the giant trash heap just over the border in TJ! Now management trying to get up and running a paid-for demo which they have been at for over 2 years and still they blow every estimate they have put out. Yet...they are heralded as the saviors of the company. Just like all that came before.
Yet not a single institutional position nor any strategic partner investment by any operator this side of the Milky Way. Insiders had to fund the company or it would be gone..I expect they will continue as long as they have a 300% incentive to do so. Of course the pps must stays above .10.
lol..nobody cares about who Qsep unsuccessfully tests...investor care about who actually bought their line of BS and placed it on active line for 6-12 months. Tcpl quickly knew they got taken and they exited quickly once they determined Tcpl was worth more as scrap metal to build a 1000 scooby doo playground sets then as a real beneficial technology!
Current CFO rubber stamped Bigger’s employment contract renewal so that his exit would trigger an early termination payoff and Mr Banker would receive his fair share of a fat payday for bombing the Tcpl and Kmcc tests. Id say that the former CEOs definition of achieving greatness has been accomplished. He was smart enough to make sure he got a payday like all that came before him! Pitiful!
20 or 30 companies is pure BS. How about they land one that actually buys something! I’ve never heard the victory song sung so loudly for a company that cant get out of gate and unable to generate meaningful sales for over two decades!
Don't forget about the new storage facility to house all the AOT units NOT deployed or in some strange limbo-land. Interestingly Qsep has yet to report that the KMCC rig has been returned after 4 years of nothingness. They acknowledge the contract is in suspension and no payments made yet they continue to milk the story like the are about to move it or use it somewhere else. The last Q repeats this smokescreen pattern while management claims it is now open and transparent. LOL!
"Kinder Morgan has expressed interest in AOT operations at one of their heavy crude pipeline locations subject to results of other AOT demonstration projects and has provided the Company with additional crude oil samples which have been tested at Temple University for future test correlation and operational planning purposes. The Kinder Morgan Lease is currently in suspension and lease payments have not yet commenced."
BTW...terms of KMCC lease made it clear KM needed to pay for this demo. Even if AOT did not work.
History has spoken and it is crystal clear.
Qsep has been unable to monetize anything it developed after 21 years of launching products which are all
based on this same or similar electromagnetic field treatment. It would be reckless to assume anything is different now unless the the Laws of Physics are now suddenly influenced by salesman’s puffery!
Anybody selling puts here? Got the august 75 at $1.40 11 day holding period.
For Qsep the game has been over for a long time. Management io all its various iteration have expertly managed the expectations of investors for decades! That should be the product Qsep actually tries to market. Magic pipes on moving Permian crude ....will never happen.
Sorry you know nothing of what you speak. The Feynmans were our neighbors and Gwyneth was a fine lady and good mom.
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The power supply is nothing more than a converter, it doesn't supply the power. While it's important, it has little to do with the performance of the AOT. I'm confident they will be back online and getting that data.”
Absurd! Aot is a anode/cathode arrangement with no moving parts! It’s entire operation depends on generating a high voltage low amp field which is the sole purpose of any such power supply. Yes the 1200 volts from the utility or gen station line is converted but any such device but so is residential house voltage!
Qsep device is already compromised by having a nutty professors as its primary inventor!
It interesting to hear the call for patience as volume heads for the door!
Wow...bagging on Disney? I don’t really understand your beef other than being a star wars fanatic and upset that the franchise didn’t go the way fans wanted it too..it’s fine I can understand that...but to suggest that the company has no creative talent and or its theme park and other revenue sources isn’t up to snuff...well that just myopic.