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Company OverviewRevolutionary products and services for natural gas compression and transportation:
Design software and services for natural gas compressors and pumping stations
Design software and services for natural gas engine development PANs (patents-pending) -- High performance piping systems for
pulsation attenuation and performance improvement
Improve pumping station reliability by reducing vibrations
Increase gas flow volume up to 30%
Increase compressor efficiency up to 20%
Decrease compressor operating costs up to 20% Decrease compressor station “Carbon footprints” up to 20%
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Team and Strategic PartnersGlen Chatfield
Founder of OPTIMUM Pumping and c0-inventor of PAN technology 1970 Founded Duquesne Systems PA’s 1st software IPO in 1984. Duquesne became Legent Corp and was sold to Computer Associates, 1995 for $1.78
billion Founder and Vice Chairman of the Pittsburgh Technology Council Alumni Fellow of the Penn State College of Engineering
Norm Shade Chairman of ACI Systems World Leader in the Natural Gas Compression industry for more than 30 yrs
Richard James Engineer and IP attorney Former VP of Operations for Voltec
Innovation WorksGas Machinery Research Council -
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Norm Shade received the Distinguished Service Awardat the 2013 Gas Machinery Conference
www.southerngas.org
Value Chain
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Exploration DrillingMidstream
TransportingProcessing
Downstream Transport &
Sales
2013
•Pipelines• Compressors• Gas Storage• Metering
2014
• Marcellus Shale• Pipelines• Compressors• Gas Storage• Metering
Lowering Costs
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Reducing transmission costs is a key factor in lowering energy costs and increasing profitability
Increasing Capacity Existing Pipelines
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Improving Reliability and SafetyPulsation>Vibration>Fatigue>Failures
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Reduce GHG Emission Taxes CARB
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20% Increased Efficiency = 20% LESS GHG Emission Taxes
Current : Pulsation Control Technology
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$800,000 of ANTIQUATED, VIBRATING Bottles with CHOKE-TUBES DISSIPATE 95% of Pulsation EnergyAnd AMPLIFY Pulsation Caused VIBRATIONS
Orifice Plate
Newest Technology: Manifold PANs
PANs Recover 95% of pulsation energy
And Minimize Vibrations
Improves Efficiency up to 20% Increases Gas Flow up to 30% Improves Reliability
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Before – Compressor with 6 Bottles
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After – with 6 Junction PAN
14% More Flow
17% More Efficient
17% Less GHG
Founded in 1952
Not-for-Profit Research Corporation
World’s Largest Natural Gas Compression Org.
Gas Machinery Conference Annually
The GMRC will receive 5% of North American PAN Royalties
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2014 Industry Sponsored Full-Scale Field Test
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Total Capital Required $1,650,000
Funds Raise to Date $1,575,000
Well knownIndustry Sponsors
Will Prove the Benefits of Manifold PANs
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Craig M. Linn, PEDirector of Engineering
New Pittsburgh Offices
2012Revenue $7.5 bilOperating Income $1.6 bil
Midstream - Marcellus
Pipeline - Alabama
Ranked 7th in the World by Platts
PAN ROI: El Paso Pipeline Retrofit
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Operating Costs
Horsepower 8,400
80% Usage kW * Hours/Year 43,897,271
$/Kwh 0.10$
Total Electricity Costs per Year 4,389,727$
Manifold PAN
Station Retrofit Cost 1,200,000$
Operating Savings
Efficiency Improvement 10%
Reduced Electric Cost per Year 438,973$
Value of Increased Gas Flow 200,000$
Reduced Maintenance Cost per Year 100,000$
Total Annual Savings 738,973$
10% Eff Improvement
Retrofit ROI of
Less than 2 years
Hardware - Pipes, TST Junctions and supports - $460,000
PAN Design Services - $150,000
PAN Royalty 8,000 hp compressor @ $20/hp - $160,000
Total 1st System PAN Cost - $770,000
Conventional 8 Bottle cost - $800,000
Additional Identical PANs $620,000 -23%
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PRICE Comparison: New PAN6-Throw Pipeline Compressor
PAN ROI: Midstream Compressor
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Hardware - Pipes, TST Junctions and supports - $200,000
PAN Design Services - $150,000
PAN Royalty 1,300 hp compressor @ $20/hp - $26,000
Total 1st System PAN Cost - $376,000
15% more flow = approx $2,000/day MORE Profit
6 month ROI
Additional Identical PANs $226,000 -40%
4 month ROI
El Paso Field Trial
Ellisburg, PA Station
July 2009
New Proven Technology: Tuned Loop PANsPipeline Comb Filters
Loop PAN Lab Demonstration
Tuned Loops – Applications
Gas Flow MetersPulsation Protection to Reduce FailuresImprove Accuracy of Flow Measurement
Centrifugal CompressorsPulsation Protection to Reduce FailuresAllowing Concurrent Operation with Recips
Pipeline Vibration and Noise Problems
Loop PANs Fix Very Expensive Problems!
PAN Patent Protection More than 30 PAN technology patents are pending or
issued in the most significant gas producing and consuming nations
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Design Software & Services
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• 20 yrs. of Development• Over 2 Million Lines of Patented and Proprietary Code• Model-Based Design Technology Optimization Technology
Real Gas (methane) NIST Data Physics
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100
1000
Speed
Increase over
conventional
design tools
5 year Pro Forma
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OPTIMUM Pumping Technology
2013 2014 2015 2016 2017
RevenueGMRC PAN Project Consulting Services $50 $100
Software Sales $0 $100 $200 $300 $400
Design Services $0 $300 $600 $1,200 $2,400
PAN Royalty $0 $450 $1,350 $4,050 $12,150
Total $50 $950 $2,150 $5,550 $14,950
ExpensesPersonnel $202 $350 $450 $550 $650
Office and Equipment $100 $160 $192 $230 $276
GMRC PAN Project R&D $30 $30 $30 $30 $30
Engineering Services $150 $250 $300 $600 $1,200
Sales and Marketing $40 $60 $90 $135 $203
Software Royalty $49 $50 $100 $150 $200
IP and corp expenses $160 $160 $192 $230 $276
Other $20 $40 $60 $90 $135
Total $751 $1,100 $1,414 $2,016 $2,970
Profit/(Loss) ($701) ($150) $736 $3,534 $11,980
2013 MilestonesOctober
Attended the Gas Machinery Conference and Promoted PAN technologies
GMRC approved a $400,000 investment in PAN Field Test Project
Williams agreed to provide a midstream PAN Project test site
Test site visited and approved
November TTE Conference
OPTIMUM model existing baseline bottle compressor
OPTIMUM and ACI design the midstream PAN
Williams approval of proposed PAN design
December Complete Project funding
GMRC Project Supervisory Committee final approval to proceed with Project
All contracts signed by the GMRC and Williams
Close VC investment in OPTIMUM Pumping
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2014 MilestonesJanuary
GMRC Project Supervisory Committee approves 1st Project milestones
February
Instrument, measure and validate baseline bottle compressor model
May
GMRC Project Supervisory Committee approves 2nd Project milestones
June
Install the PAN and measure its performance
October
Present GMC Paper on the Results of the GMRC PAN Field Test
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Use of $2mil Proceeds
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Working Capital 800,000$
Patent and IP Legal Expenses 200,000$
IT Hardware and Software 80,000$
GMRC Membership 40,000$
Engineering Software 200,000$
Multi-Stage Compressor support for VPS 50,000$
Pipe Network Simulation in VPS 100,000$
Vibration System Simulation Interfaces with VPS 60,000$
European Expansion 100,000$
Middle East Expansion 100,000$
Central and South American Expansion 100,000$
Pacific Rim Expansion 100,000$
Asian Mainland Expansion 150,000$
2,080,000$