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The Ubika Research Tech Stock Watchlist
| Wavefront Technology Solutions Inc (V.WEE) |
| Company Name: |
Wavefront Technology Solutions Inc. |
| HQ Location: |
Edmonton, Alberta |
| Company Website: |
www.onthewavefront.com |
| Shares Outstanding |
71.7 Million |
| Market Cap: |
$167 Million |
| 52 Week Range |
$0.52 - $3.05 |
| Closing Price (March 30, 2010) |
$2.33 |
| Average Daily Volume |
145,000 |
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Share Highlight / 1-Year Stock Chart
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Business Overview
Wavefront specializes in designing and developing leading-edge techniques for oil well stimulation, improved oil recovery, and environmental groundwater remediation. Wavefront is a technology-based company with a focused, strategic plan to leverage the value of its intellectual property in order to maximize oil production recovery operations, as well as provide additional solutions for environmental applications. Far more effective than traditional fluid injection processes, Wavefront’s dynamic injection approach is ideal for oil recovery revitalization and in the cleanup of shallow ground contamination. + More info
What is interesting?
- Wavefront has a technology which is working that significantly improves on conventional techniques for secondary and tertiary oil recovery and environmental groundwater remediation in terms of cost, efficiency and efficacy. Basically, Wavefront has an intellectual property that improves the production of oil from current wells.
- There are a variety of well stimulation techniques such as water, carbon dioxide etc that are used to recover the oil from oil wells. Wavefront has a technology that significantly enhances what is out there currently for oil extraction.
- Wavefront technology, as the name suggests creates waves. This technology is pulsing water or other liquids into the wells unlike straight injection at constant pressure. This allows the water or the fluid to spread on a wider area leading to more oil being recovered.
- This technology also works on soil remediation as pulsing any cleaning fluid through soil allows more contaminants to be removed as the cleaning fluid spreads on a lot more area
- Any technology that enhances the oil recovery from existing wells is huge. It is very expensive to find new oil. The cost of new discoveries is going up. Hence even though oil prices are rising, overall return on capital for oil companies are not rising as much as oil prices, as it is getting harder and harder to have large oil discoveries.
- Also, typically in the oil business once a well is found, only around 20% oil is considered recoverable and recovered. 80% of the oil found in the wells is still on the ground. Hence, any technology which can allow this oil that we know to be sitting on wells extracted economically is very attractive in this capital intensive business. Hence the attraction of the Wavefront technology and product. For example, Pemex the state owned Petroleum Company is currently recovering just 7 per cent of the original volume of the Chicontepec field in Mexico, which has 139 billion barrels of oil. Pemex is testing the Wavefront technology.
- Wavefront has a number of real customers using their technology. One of its clients in Alberta is expanding the usage of Wavefront product, suggesting that the company’s product seems to be working in real-life environment
- As of Nov 30 2009 financial statements, the company had a quarterly revenue of over half a million dollars, but had a good cash position of $13 Million
Risks
Wavefront has never been profitable and is still losing money and will need additional capital if it does not become profitable. Being a technology which is still being fully commercialized, whether this technology will work in all geological situations is yet to be seen. The market capitalization of the company is $167million suggesting valuation is not cheap. While not directly related to oil prices, producers tend to reduce their spending budgets if oil prices go low. Low oil prices can affect the prospects for the company. Oil companies have long history and memory. Hence any technology adoption is a slow process
Wavefront Technology Solutions Inc. News
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