QS Energy Inc (QSEP)

[mr_sano]

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!

Subsequent laboratory testing performed at our Tomball facility showed the electrical conductivity of the oil to be quite high and in line with field observations. This is further indication that the unit is likely functioning properly and does not have a current leak. It was decided to return to the field and test the AOT and obtain new samples for lab testing to verify previous results. During the field test we were able to verify the high conductivity. We believe this eliminated the possibility the original result was due to water in the cell. We are continuing to test new samples in the lab, but all tests performed to-date indicate high conductivity.

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.