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Replies to post #20058 on First Bitcoin Capital Corp (BITCF)
12/03/17 5:30 PM
Petroteq Energy Inc. (PQE.V; PQEFF)
Petroteq Energy Inc. offers a unique, one-of-a-kind oil production technology that could unlock millions of barrels of oil, and it will be able to produce the oil cleanly and at a low cost. Better yet, Petroteq plans on licensing its technology around the world, raking in hefty profits in the process.
Petroteq has developed a patented technology to extract oil sands in an entirely new way. The conventional method involves mining, lots of water and steam, toxic trailing ponds, lots of emissions, and an incredibly dirty PR image. Canada's oil sands industry is a pariah in many parts of the world - the target of environmental groups, divestment campaigns and increasingly stringent government policy.
Petroteq turns that whole idea on its head. The small company uses a proprietary technology that consists of a closed-loop system and a solvent that cleanly extracts heavy oil sands. It extracts 99 percent of all hydrocarbons at the site, uses no water (so no need for toxic trailing ponds), requires no high temperatures or pressures, and generates no greenhouse gas emissions.
Petroteq is the first company to generate sales from Utah's massive heavy oil reserves in the Unitah basin, which holds an estimated 32 billion barrels.
But surely this can't be profitable? On the contrary, Petroteq will have a plant up and running by February that will produce 1,000 barrels per day with production costs as low as $28 per barrel.
Better yet, the company recently moved its modular plant much closer to the resource, eliminating transportation costs, which could put production costs in the low-$20s per barrel. With efficiencies and scale, Petroteq is aiming at producing 5,000 bpd in 2019 at $18 per barrel. The company is confident it can eventually reach 30,000 bopd based on the proven reserves.
Oil sands from Canada typically trades at a discount, often as much as $20 per barrel below WTI. Some of that is due to quality issues, but a lot of it is due to a shortage of pipeline capacity from Alberta to markets in the U.S., plus the cost of shipping itself.
Petroteq is leaving Canada's old oil sands in the dust. Its location can't be beat, it avoids the hassle of shipping, and the company is nearing agreements with oil majors to purchase 1,000 barrels per day. All of that means that Petroteq's heavy oil is selling at a price that is about on par with WTI - a level that Canada's oil sands giants could only dream of.
But Petroteq's operations in Utah are really just a proving ground for the real moneymaker: licensing its technology to producers around the world. Countries with heavy oil - Canada, China, Indonesia, and parts of South America - are at the top of the company's list. Producers would pay Petroteq a per-barrel fee for the use of their clean oil recovery technology.
That isn't all. In addition to profitable oil sands in Utah and technology licensing, the third leg of Petroteq's stool is blockchain development, which will revolutionize the trade of commodities by offering secure, digitized, tamper-proof and open source data. Petroteq is signing a deal with First Bitcoin Capital, licensing the blockchain built by IBM and turning it into an industry-specific platform (to be completed within the next six months), allowing for the secure flow of data up and down the supply chain.
As The Economist put it earlier this year, "The world's most valuable resource is no longer oil, but data."
Put it all together, and Petroteq offers a compelling investment case that nobody will want to miss. A profitable and clean oil sands extraction technology that has no other competitors; a plan to license that technology all over the world; and a blockchain platform that will lead the industry into a new era.
