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Replies to post #45219 on QS Energy Inc (QSEP)
Our Form 10-Q filed with the SEC on August 14, 2018 provided brief descriptions of our prospective projects in the United States, South America and Asia. I am most excited by our prospective project in the Southern United States. We crossed an important milestone on this project last week by reaching a general understanding of the project’s scope, timeline and terms, relating to the installation and demonstration of our AOT equipment. Getting to this stage has been a long process, going back more than a year working with the operator’s management and engineering staff to qualify our technology, select target installation sites, procure and test crude oil samples, develop an installation and operations timeline and reach a general understanding on the scope and terms of work to be detailed in final definitive documents. Now that we have a general understanding of terms, we have begun the process of preparing definitive documents and are targeting installation and operation late in the fourth quarter of this year. Crude oil samples provided by the pipeline operator for this project have been tested at Temple University, indicating AOT could significantly reduce viscosity of heavy crudes transported through this pipeline. Analysis of the pipeline configuration provided by the operator indicate the proposed location has excellent potential for demonstration and testing purposes. Initially, we intend to install this first midstream AOT for operations as a demonstration site utilizing equipment available in Company inventory, minimizing the cost to install and operate the demonstration project. We have sent an AOT out for hydrotesting in anticipation of installation in the next 60 to 90 days.
Although our primary focus has been devoted to the project described above, discussions continue with pipeline operators in the West Coast United States, South America and Asia.
A Company representative met with our prospective Asian customer last week. We learned at that meeting that our potential project there has been put on hold due to new management and budget constraints. Originally, we were targeting project installation in 2018. We hope to restart this project in 2019.
We also are in discussions with a West Coast operator, which runs a heavy crude gathering line that relies heavily on diluent to achieve required viscosity. This potential project could provide an excellent opportunity to demonstrate our AOT for upstream and trucking applications, targeting operations in late 2018 or early 2019.
We are also working with a number of prospective customers in South America, primarily focused on three pipeline operators in the Colombian market with operations in upstream, midstream, barge, and tanker truck applications. We have acquired our first crude oil sample, which is in transit to Temple University for testing. We are also in discussions with Colombia’s Universidad de los Andes and a local independent hydrocarbon testing laboratory to accelerate our ability to test and operate in the Colombian Market.
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