Corporate Presentation. July 2017

Transcription

1 Corporate Presentation July 2017

2 Forward Looking Statements Certain statements in this Acceleware presentation, other than statements of historical fact, may include forward-looking information that involves various risks and uncertainties. These may include, without limitation, statements based on current expectations involving a number of risks and uncertainties related to all aspects of the oil and gas technology industry. These risks and uncertainties include, but are not restricted to, ability of the Corporation to fund its research and development (R&D) activities, the timing of such R&D, the likelihood that the patent applications filed by the Corporation will be granted, continued increased demand for the Corporation's products, the Corporation's ability to maintain its technological leadership in the fields of seismic imaging, radio frequency of heavy oil and electromagnetic simulations, the future price and cost of producing oil sands and shale oil, the Corporation's ability to attract and retain key employees, defend itself against any future patent infringement claims, and the availability of key components. These uncertainties may cause actual results to differ from information contained herein. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. The Corporation assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change except as required by law. 2

3 What Does Innovation Mean? Acceleware s RF XL delivers a lower break-even point, 3 AND sustainably higher margins.

4 What Does Innovation Mean? RF XL addresses environmental challenges: 4 Lower GHGs No external water No solvents

5 What is Radio Frequency (RF) Heating? Functions like an inside-out microwave oven Can be deployed horizontally or vertically Production levels of SAGD, using less than half the energy 5

6 6 RF XL Offers simplicity No steam plant No (or minimal) water treatment Minimal on-site labour to operate and maintain Less land use No water SAGD Plant

7 RF XL Offers Simplicity RF XL Plant Lower CAPEX Mobile CAPEX Lower OPEX Less to reclaim Less GHG 7

8 Efficiency : Energy to Useful Heat SAGD 8 Heat losses at steam plant Heat losses from plant to well pad Heat losses down to formation Heat losses from produced water GJ/m3 RF XL Power to RF at 98% 99% efficiency RF to formation at >95% efficiency RF penetrates the formation heating water volumetrically Far less water is produced GJ/m3

9 Impact: OPEX Cost ($/bbl) Advantage Fuel/Electricity Non Fuel $16.00 TODAY'S ECONOMICS LONGTERM ECONOMICS $14.00 $12.00 $ % (avg) $ % $8.00 $7.80 $6.00 $4.00 $2.00 $4.47 $2.78 $3.70 $3.00 $2.98 $6.04 $3.75 $4.60 $0.00 CHRISTINA LAKE 2017 COSTS FOSTER CREEK 2017 COSTS RF XL 2017 COSTS SAGD (SOR = 3.25) LONG TERM COSTS RF XL LONG TERM COSTS 9

10 Impact: CAPEX ($/fbbl) Facilities Steam plant RF System $45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 $16,000 $24,000 SAGD 74% $6,131 $4,300 RF XL 10

11 Stable Costs with Rising WTI $50 WTI $70 WTI $90 WTI Costs per barrel (USD) $80.00 $60.00 $40.00 $20.00 $0.00 RF XL SAGD Top Quartile Permian Generic $ $ $ $ $ RF XL SAGD Top Quartile $80.00$50.00 $45.00 $40.00 $60.00 $35.00 $30.00 $40.00$25.00 $20.00 $15.00 $20.00 $10.00 $5.00 $0.00$- Permian RF XL Generic SAGD Top Quartile Permian Generic $50.00 $45.00 $40.00 $35.00 $30.00 $25.00 $20.00 $15.00 $10.00 $5.00 $0.00 Netback per barrel USD) capital costs Operating costs Discount, transportation, royalties Netback (right scale) 11 Source: Acceleware Estimates

12 Impact: GHG Reductions C02 Emissions (kg/bbl) 23% 49% 56% 100% SAGD 2016 Grid CCGT 2030 Grid Renewable 12

13 Impact: Other Key Benefits Scalability viable one well at a time First oil in days not months Mobile easy to re-deploy capital Higher margin avoids service cost inflation Broad target market Bitumen & Heavy oil Thin-pay heavy oil Potential for carbonates, shale oil, shallow, deep 13

14 Our Discoveries RF can work, but: Efficiency too low; CAPEX/watt too high; well-bore dimensions limit power; difficult to deploy; and well length is limited. 14

15 Our Innovation Re-designed from the ground-up with: GE partnership for high-efficiency, lower cost per watt; new transmission & delivery methods for low losses, easy deployment; and antenna design that supports long wells. 15

16 Addressable Market bbls by type Play Resource OOIP (Bbbls) Athabasca Oil Sands Bitumen 1,600 Post-CHOPS (AB/SK) Heavy Oil 250 SK Thin-Pay Heavy Oil 25 Orinoco Oil Belt Extra Heavy 1,200 Middle East Heavy Oil Over 3 trillion potential barrels for RF XL AXE revenue potential of ~ US $1/bbl

17 RF XL Differentiators Simple, inexpensive, easy to deploy Partnership with GE for the latest low-cost, highefficiency technology from power industry Can use SAGD drilling & completions techniques Predominantly standard materials, components, and processes Specifically developed for long horizontal wells 17

18 RF XL vs. SAGD Simulation RF XL 475,000 GJ 1 M barrels SAGD: 1,150,000 GJ 726K barrels 18 RF XL produces more barrels than SAGD with less than half of the energy

19 19 RF XL Energy Efficiency vs. SAGD

20 RF XL 1/20 Scale Test 20

21 RF XL 1/20 Scale Test 21

22 1/20 Scale Test Objectives Achieved Formation Temperature (East) 22 Max Temperature ( ) Time (hrs) ü Deliver high power to the formation with scaled components; ü heat the formation as predicted by simulation; and ü test and confirm proprietary system design.

23 1/20 Scale Test Objectives Achieved 23 ü Deliver high power to the formation with scaled components; ü heat the formation as predicted by simulation; and ü test and confirm proprietary system design.

24 Why Will Acceleware Succeed? 25 + years leadership in electro-magnetics and antenna design; extensive design and testing work with super majors & IOCs; GE partnership for electronics; and 24 viable plan to expand oil field skills and capabilities.

25 25 RF Heating Timeline

26 RF XL Commercial Scale Field Test Q Q Q Q Q Q Q Q GE generator design, assembly, testing Site selection, engineering, simulations Drilling & completion Heating test Analysis / reporting Extended heating test 26

27 Acceleware Business Model 27 Modular and mobile RF heating systems to be sold or leased RF XL systems will be housed in customized shipping containers to meet operator s requirements for number of wells per well pad Purchase pricing based on power capacity plus annual maintenance and support fee Remote monitoring will ensure continued operation and minimal down time, rolling trucks only when needed Acceleware will monitor grid prices to manage power levels based on each operators defined price/power tolerance levels Applying machine learning to build more value over time Resulting in continued growth in the value of our analytics, giving operators better results year after year

28 RF Patent Portfolio Concept Status Filing Type Est. Grant Date Leaky Wave Antenna Jointly with Chevron on previous work US Granted 2017 Shaped Dipole Antenna Jointly with Chevron on previous work US Granted 2017 Modular RF System Filed: Oct 7, 2014; (Publ. April 2016), Favourable Int. Search Report issued US, Canada, PCT, Europe 2017 Travelling Wave Antenna for EM Heating Filed: Feb 5, 2015 US, Canada RF XL System 1 RF XL System 2 Antenna Patent 1 Antenna Patent 2 Filed PCT Apr 10, 2017, Filed as US Provisional April 13, 2016 Filed PCT Apr 10, 2017, Filed as US Provisional Oct 17, 2016 Draft patent in final edits, expect to filed in June 2017 Draft patent in final edits expect to file in June 2017 PCT, provisional US 2018 PCT, provisional US 2018 Provisional US Provisional US 3 more patents in preparation To be filed in 2017 Provisional US

29 Seismic Imaging Software

30 Seismic Imaging Software Acceleware has a portfolio of three software products and relationships with five distributors in this space - and blue chip customers. AxRTM AxFWI AxWave 30

31 Seismic Imaging Business Unit $1.4M annual revenue Cash-flow positive business Growth potential as oil prices stabilize and rise New product growth from AxFWI as emerging product Migration of all products to the cloud Strong channel relationships 31

32 Summary Low-cost, low-carbon innovation for heavy oil Lower break-even, and higher margins long-term Half the CAPEX & half the OPEX vs SAGD No water, no solvent Continued innovation and development of IP Simple deployment will facilitate adoption Cash flow positive software business 32

33 Appendix

34 Executive Team Geoff Clark Chief Executive Officer 8 years at AXE, 25 years business experience B.Sc. Electrical Engineering, MBA Michal Okoniewski Chief Scientific Officer AXE cofounder Ph.D. Electrical Engineering and IEEE Fellow Mike Tourigny VP, Commercialization RF Heating Joined AXE in 2013, 20 years business experience B.Comm., MBA 34 Dan Cyca Chief Technology Officer 12 years at AXE B.Sc., M.Sc. Electrical Engineering

35 Corporate Summary Shares outstanding 86million Fully diluted 97 million Recent share price $0.18 Trading range (52 weeks) $ $0.43 Key shareholders: Management 25% NVIDIA 5% Resource Merchant Capital 5% Employees Revenue $1,395, EBITDA ($1,961,543) 2016 R&D $1,247,000 35

36 Thank You