NXT Energy Solutions CEO Discusses Disruptive Oil and Gas Geophysics Technology on Midas Letter Money
NXT Energy Solutions Inc. (TSX.V:SFD) (OTCQX: NSFDF) George Liszicasz is the guest on Midas Letter Money. George describes his company’s patented “SFD” or Stress Field Detection technology, that is poised to revolutionize the way oil and gas prospecting is performed.
The technology has found acceptance by Colombia national oil company Ecopetrol (NYSE:EC) and Pacific Rubiales Energy Corp. (TSX:PRE), and has been utilized in a study with British Petroleum. (NYSE:BP)
Transcript of the interview as follows:
James West: I’m James West this is Midas Letter Money. My next guest is proposing to revolutionize the way oil and gas exploration is conducted. George Liszicasz is is the chairman and CEO of NXT Energy Solutions Inc, which trades on the TSX venture under the symbol SFD and on the OTC bulletin board under the symbol and NSFDF. George thank you for joining us today.
George Liszicasz: thank you very much.
James West: They’re George I’ve seen all kinds of documentation about this technology – you essentially proposed to raise the success of first pass prospecting for trapped hydrocarbon reserves underground by up to 70%. How do you do that?
George Liszicasz: Well we use it to identify trapped reservoirs. If you can identify trapped reservoirs and you drill always into trapped reservoirs, then your success rate into ydrocarbon-bearing basins will increase significantly.
James West: So basically you’re going to replace first pass 2D seismic which costs a lot of money, and takes a long time how long’s it take to — say 10,000 kilometers or 10,000 square miles with your technology and interpret the data?
George Liszicasz: If you take 10,000 square kilometers and you fly in a grid system let’s — seven point five by seven point five kilometres then it should take two months to evaluate your data and about one month to flight it.
James West: Have any of the major oil and gas companies made use of the the technology?
George Liszicasz: We have been extraordinarily successfull especially in South America with the tool. We used it onshore and offshore with a national oil company Ecopetrol, with Pacific Rubiales which is the fastest growing company in South America – 300, 000 barrels per day production – And we’ve used it in an offshore study with British Petroleum (NYSE:BP) as well.
James West: So this technology has found oil and gas fields?
George Liszicasz: Yes.
James West: OK so tell us how does the revenue picture work on this technology for your company?
George Liszicasz: Well we had sporadic revenue generation in the past. Due to our refocusing in in South America. But this year it’s looking very good. We are going to do twice the revenue that we did last year and the future looks even brighter. So we’re going to do $12 million plus this year. Our gross margin is about 65 plus percent. So we are looking at a very strong year.
James West: Have you had any skepticism on the part of the majors in adopting your technology? I’m curious as to why doesn’t everybody use technology if its so good?
George Liszicasz: Of course any disruptive technology that is being introduced into the industry will undergo significant scrutinization. And it takes time for the industry for the industry to adopt any kind of technology that is disruptive.
James West: OK so you’ve got majors looking at the technology, you’ve got some large companies in Colombia using the technology – where are the roadblocks to success?
George Liszicasz: Well the first of first part of the question – is that do business mainly with the NOCs – the national oil companies – It’s just a better avenue for us. The major oil companies have their research and development laboratories and so on so for them to adopt the technology they have to understand everything about the technology before they can say yes. — we want to use your tool
James West: Okay in simple terms how does that technology work
George Liszicasz: The oil and gas traps and reservoirs are formed due to forces – the three principle sources – Interacting within the sustrate below the surface. These forces give rise to reservoirs and traps. And any stressed material will alter it and any energy propagating through it. And that includes gravitational energy propagation. And that will create a rotational effect so in essence the technology responds to the rotational component of the gravitational field.
James West: When oil and gas reservoirs present?
George Liszicasz: No… what happens is that when oil and gas reservoirs are present… let’s say there’s a reservoir. So the dection of stress will change. So the reservoir will disspiate stress rather than keep the magnitude and direction of the stress the same.
James West: So it’s essentially you measuring the effect of the stresses in hydrocarbon basins – or in traps – on gravity.
George Liszicasz: That’s correct.
James West: That’s really interesting George. I’d like to thank you for joining us today.
George Liszicasz: Thank you for having me.
James West: If you’d like to learn more about NXT Energy Solutions, you can visit them online at an NXTenergy.com. If you like to learn more about companies like NXT energy, visit Midas Letter.com I’m James West – this is Midas Letter Money.
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