1. R E D U C I N G W E L L D E V E L O P M E N T C O S T S T H R O U G H N O V E L W A T E R
T R E A T M E N T T E C H N O L O G Y A L L O W I N G W A T E R T O B E R E C Y C L E D
W I T H O U T L I M I T D U E T O C O N T A M I N A N T B U I L D - U P
WFV
FONTUS ENVIRONMENTAL CORP.
PRESENTATION TO:
2. 2
I. WATER MANAGEMENT OF FLOW BACK (FRACKING)
II. FracVap TECHNOLOGY – FLOW BACK DISTILLATION
III. BATCH TESTING OF ENTIRE PROCESS
IV. WAREHOUSE PROTOTYPES (2) AND MOBILE FIELD UNIT
V. MOBILE TREATMENT PLANT OPERATIONAL BY END OF 2016
VI. EXXON, HUSKY, CULLIGAN, MATRRIX ENERGY......
3. ■ F l o w B a c k f r o m h y d r a u l i c f r a c k i n g i s s i g n i f i c a n t l y c o n t a m i n a t e d ,
b o t h i n T o t a l S u s p e n d e d S o l i d s ( T S S ) a n d i n T o t a l D i s s o l v e d
S o l i d s ( T D S ) , t h e l a t t e r t y p i c a l l y i n t h e o r d e r o f 1 0 0 , 0 0 0 P P M ;
■ R e l e a s e o f t r e a t e d F l o w B a c k i s p r o h i b i t e d i n b o t h C a n a d a & U S A ;
■ T r u c k i n g o f c l e a n w a t e r t o r e m o t e l o c a t i o n s a n d d i s p o s i n g o f
c o n t a m i n a t e d w a t e r o f f - s i t e i s e c o n o m i c a l l y u n s u s t a i n a b l e a t
c u r r e n t o i l p r i c e s ; a n d
■ F l o w B a c k i s d e e p - w e l l - i n j e c t e d i n s o m e c a s e s w i t h s i g n i f i c a n t
e n v i r o n m e n t a l r i s k t o g r o u n d w a t e r q u a l i t y .
3
THE
4. ■ R e m o v e T S S f r o m F l o w B a c k u s i n g c o n v e n t i o n a l , o f f - t h e - s h e l f a n d
e n v i r o n m e n t a l l y a p p r o v e d w a t e r t r e a t m e n t t e c h n o l o g y ;
■ R e c o v e r c r u d e o i l f r o m f l o w b a c k u s i n g c o n v e n t i o n a l o f f - t h e - s h e l f A P I
( d e n s i t y - b a s e d ) t e c h n o l o g y ;
■ R e d u c e T D S l e v e l s f r o m a r o u n d 1 0 0 , 0 0 0 P P M t o 1 0 , 0 0 0 P P M u s i n g
c o n v e n t i o n a l o f f - t h e - s h e l f f l o c c u l a t i o n t e c h n o l o g y t o m e e t p u r i t y c r i t e r i a i n
a d v a n c e o f r e s i n t a n k s f o r r e m o v e o f s p e c i f i c i o n s t o m i n i m i z e c l e a n i n g
c y c l e s f o r r e s i n s ;
■ R e d u c e T D S f r o m 1 0 , 0 0 0 P P M t o l e s s t h a n 5 0 P P M t h r o u g h f l a s h e v a p o r a t i o n
p r i o r t o e n t r y i n t o r e - c o n f i g u r e d c o o i n g t o w e r e q u i p m e n t f o r c o n d e n s a t i o n o f
v a p o r i n c o n d e n s a t i o n c o i l s , a n d r e - u s e o f d i s t i l l a t e i n f r a c k i n g o p e r a t i o n a n d
w e l l c o m p l e t i o n ; a n d
■ L o w e r w e l l c o m p l e t i o n c o s t s b y C d n $ 6 0 0 , 0 0 0 p e r w e l l .
4
THE
6. Novelties of FracVap
6
■ Latent heat from the well entering the Frac Vap is captured by a plate and
frame heat ex-changer, stored in a thermal bank and used throughout
the process;
■ CO2 generated from flocculation step lowers pH from 11.5 to about 8.5 in
advance of ion exchange resins;
■ Application of Purolite’s Mixed Bed and Specific Ion Exchange Resins
to remove general and specific ions from solution;
■ Re-Configured Cooling Tower from USA Manufacturer:
Use of Pall Filters to achieve water quality polishing efficiencies ≈ reverse osmosis (requiring psi of
30 rather than 1200 psi required for RO)
Adapt cooling tower equipment used in A/C applications for building towers to recover water from
back flow produced from hydraulic fracking as distilled water vapor – as pure H2O
Recover water from water vapor as liquid H2O for recycling and reuse in fracking process. No
limitation to number of times water is recycled as quality is constant ≈ 100% pure.
7. Novel Steps in FracVap Process
7
Absorption Refrigeration Process Garry to name
8. Steps in FracVap Process
8
a) SOLIDS REMOVAL
• HYDRO-CYCLONES
• CENTRIFUGE
• DRYING OF SOLIDS
b) OIL RECOVERY
• API SEPARATION
• SELF-CLEANING
ACTIVATED CARBON
c) FLOCCULATION
• LIME & SODA ASH
• LATENT HEAT
• DRYING OF SOLIDS
d) ION EXCHANGE
• CO2 – PH REDUCTION
• MULTIPLE STEP
RESIN TREATMENT
TSS REMOVAL, OIL RECOVERY & TDS REDUCTION: 100,000 - 10,000 PPM
FLOW
BACKFEED
Stage 1
e) MICRO-FILTRATION
• MULTIPLE FILTRATIONS
• PALL FILTERS – EFFICIENCIES
SIMILAR TO REVERSE OSMOSIS
AT SIGNIFICANTLY LOWER PSI
f) FLASH EVAPORATION OF
H2O
• MICRO-PARTICLES
DEPOSITED ON TUBES ARE
RECOVERED VIA PATENTED
PROCESS
g) CONDENSATION OF H2O
• CONDENSATION OF DISTILLED
WATER FOR REUSE IN
FRACKING (CONDENSATION
COILS)
REDUCTION OF TDS FROM 10,000 PPM TO 0 PPM
COOLING TOWER: DISTILLATION & CONDENSATION OF H2O
Stage 2
CONVENTIONAL TSS REMOVAL & MINERAL SALT FLOCCULATION
H2O DISTILLATION USING RE-DESIGNED COOLING TOWER
9. FracVap Flow Sheet
9
Condensation of H2O
Solids Removal
Oil Recovery
Flocculation
Ion Exchange
Micro-Filtration
Flash Evaporation
Solids
Dryer Dried SolidsA
Crude OilB
Liquid H2OC
Latent Heat
CaO/Na2CO3
CO2 / H2SO4
Make-Up Heat
Back Flow
Fracking Operation
Fertilizer/ Dried
Waste for Disposal
Solids from
condenser tubes
Micro-particles
Self-cleaning
product
Mineral Salts
TSS
10. WFV’s Three Products
10
WFV produces three (3) products:
A) Solids (dry): Combined solids from centrifuge, resins, filters and cooling tower
tubes are dried in a chemical drier.
B) Crude Oil: Returned to client to off-set service cost of water treatment (≈10
bbl/day @ 1.325 m3/minute).
C) Distilled H2O: Condensed H2O is returned to fracking operation for unlimited
number of cycles (no contaminant build-up).
11. Equipment Suppliers
Note: Most are locally supplied, 3 are sole-sourced and 1 is re-designed
11
STAGE EQUIPMENT SUPPLIERS NEW/USED
TSS REMOVAL
HYDRO-CYCLONES,
CENTRIFUGE, ETC.
CHINESE SUPPLIER (Cdn$
80,000/unit compared to $
Cdn$ 750/unit in Alberta)
NEW OR USED
OIL RECOVERY API SEPARATION SYSTEM ISO-THERM INC. NEW OR USED
FLOCCULATION
REACTORS, SETTLING TANKS,
CENTRIFUGE, DRYER
NUMEROUS NEW OR USED
ION REMOVAL RESINS & RESIN TANKS PUROLITE NEW
MICRO-
FILTRATION
MIXED BED & MICRO-
FILTRATION
PALL FILTERS NEW
WATER
DISTILLATION
USED COOLING TOWER AND
STAINLESS STEEL TUBES
BALTIMORE AIRCOIL
COMPANY and various
Canadian Suppliers
USED (NH3-
corroded tubes are
removed)
WATER QUALITY
CONTROL
IN-LINE TDS MONITORS, pH
METERS, ETC.
NUMEROUS NEW
MAKE-UP POWER GENSET NUMEROUS USED
MOBILE PLANT
CONTAINERS (3) , SEMI FLAT-
BED TRUCK, PUMPS, PIPING
NUMEROUS USED
12. Major Equipment
12
Jar Testing Equipment Decanter Centrifuge API Separation System
Jar Testing Equipment Garry to name Chemical Drier
Sand Filters Micro-Filters (Pall) Cooling Tower (Tubes)
13. ■ P r o c e s s f r o m s o l i d s r e m o v a l t o m i n e r a l s o l i d s f l o c c u l a t i o n h a s
b e e n d e m o n s t r a t e d a t l a b - s c a l e i n b a t c h t e s t s , a c h i e v i n g a 9 0 %
r e d u c t i o n i n T D S .
■ A l b e r t a d r i l l i n g c o m p a n y c o n t r a c t e d C u l l i g a n t o v e r i f y d a t a o n
F r a c V a p P r o c e s s . V e r i f i c a t i o n w a s s u c c e s s f u l .
■ E f f l u e n t f r o m r e s i n e x c h a n g e t a n k s w a s t r e a t e d i n r e - d e s i g n e d
c o o l e r t o w e r a c h i e v i n g d i s t i l l e d H 2 O l e v e l s o f p u r i t y i n v a p o r
l e a v i n g c o o l i n g t o w e r ( B a t c h T e s t s ) .
■ P a t e n t s h a v e b e e n f i l e d f o r r e s i n s t e p s i n s t a g e 1 a n d a l l o f S t a g e
2 o f F r a c V a p P r o c e s s .
.
13
Status of WFV
14. ■ B u i l d a 3 5 G P M ( 1 / 1 0 t h o f M o b i l e P l a n t c a p a c i t y ) W o r k i n g
P r o t o t y p e ( f r o m A p r i l u n t i l M a y o f 2 0 1 6 ) i n a w a r e h o u s e ;
■ C h a r g e c l i e n t s C d n $ 1 0 0 k f o r 3 0 - d a y d e m o n s t r a t i o n o f F r a c V a p ’ s
t r e a t m e n t o f f l o w b a c k u s i n g c l i e n t s ’ w a s t e w a t e r ;
■ B u i l d a n d c o m m i s s i o n M o b i l e P l a n t ( f r o m J u l y u n t i l S e p t e m b e r ,
2 0 1 6 ) e a r n i n g C d n $ 2 5 7 K / m o n t h ( a p p r o x ) ;
■ B u i l d s e c o n d W o r k i n g P r o t o t y p e ( f r o m N o v e m b e r u n t i l D e c e m b e r
o f 2 0 1 6 f r o i n d u s t r i a l w a t e r t r e a t m e n t d e m o n s t r a t i o n s ; a n d
■ R e c o v e r y o f i n v e s t m e n t c a p i t a l b y M a r c h o f 2 0 1 7 .
14
Commercial Plan
15. Warehouse Prototype Mobile Plant
Treats 35 GPM (0.132 m3/minute);
Water is heated to temperature
encountered in fracking operation;
Clients are charged Cdn$ 100K for
a 30-day 24-hour demonstration of
FracVap system;
Second Prototype shares control
room with first;
Operating staff of first plant run
the second prototype; and
Second prototype is used to treat
industrial water sources.
Treats 350 GPM (1.32 m3/minute);
Client pays for all chemical reagents
and utilities;
Oil is returned to the client without
charge;
Client is charged Cdn 8.50/m3 for
treatment of flow back plus
approximately Cdn$ 0.83/m3 for
reagents after subtraction for
recovered oil;
EBITDA is Cdn$ 4.67/m3; and
EBITDA is Cdn$ 357,597/month.
15
WFV’s Business Model:
Terms, Conditions & Assumptions
16. Projected First Year Financials
(April 2016 – April 2017
16
Financial Item
2016 2017 TOTALS
(Cdn$)Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
INVESTMENT
Warehouse Prototype
Capital ($120,175) ($120,175) ($120,175) ($120,175)
Working Capital ($80,000) ($252,000) ($80,000) ($80,000)
Sub-Total ($200,175) ($372,175) $0 $0 $0 $0 $0 ($200,175) ($372,175) $0 $0 $0
Mobile FracVap Plant
Capital ($396,262) ($396,262) ($396,262)
Working Capital ($104,000) ($104,000) ($104,000)
Sub-Total ($500,262) ($500,262) ($500,262)
Total Capital
Investment
($200,175) ($372,175) $0 ($500,262) ($500,262) ($500,262) $0 ($200,175) ($372,175) $0 $0 ($2,645,487)
REVENUE
Working Prototype $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $200,000 $200,000 $200,000
Mobile FracVap Plant $257,597 $257,597 $257,597 $257,597 $257,597 $257,597
Total Revenue $0 $0 $100,000 $100,000 $100,000 $100,000 $357,597 $357,597 $357,597 $457,597 $457,597 $457,597 $2,845,581
EBITDA (Cdn$) ($200,175) ($372,175) $100,000 ($400,262) ($400,262) ($400,262) $357,597 $157,422 ($14,578) $457,597 $457,597 $457,597 $200,094
1st Warehouse
Prototype
Mobile
Plant
2nd Warehouse
Prototype Recovery of
capital in 12
months
17. 17
OPEX Cdn$/year Cdn$/day Cdn$/m3
Service Charge Paid by Client Revenue for WFV (Cdn$/m3)
Cdn/m3 % Cdn$/m3 %
Operators (4) $ 180,000 $ 493.15 $ 0.26 Not Applicable -$0.26
Supervisors (4) $ 180,000 $ 493.15 $ 0.26 Not Applicable -$0.26
Management $ 905,000 $ 2,479.45 $ 1.30 Not Applicable -$1.30
Other (contracted) $ 150,000 $ 410.96 $ 0.22 Not Applicable -$0.22
WFV's Plant Consumables
Make-Up Energy $ 438,000 $ 1,200.00 $ 0.63 -$0.63 7% Not Applicable
Carbon $ 50,000 $ 136.99 $ 0.07 -$0.07 1% Not Applicable
Resin $ 50,000 $ 136.99 $ 0.07 -$0.07 1% Not Applicable
Cao $ 50,000 $ 136.99 $ 0.07 -$0.07 1% Not Applicable
Na2CO3 $ 50,000 $ 136.99 $ 0.07 -$0.07 1% Not Applicable
Refrigerant (if necessary) $ 50,000 $ 136.99 $ 0.07 -$0.07 1% Not Applicable
WFV's Non-Labor-based OPEX Not Applicable -$2.03 -44%
WFV's Labor-based OPEX Not Applicable -$1.80 -39%
OPEX TOTAL (Cdn$) $ 2,103,000 $ 5,761.64 $ 15.79 -$0.99 -$3.83
Service charge (WFV) $ 8.50 -$8.50 91% $ 8.50 182%
Recovery of Crude Oil* $ 300.000 $ 0.16 -2%
TOTAL (Cdn$) -$9.33 100% $4.67 100%
Back Flow Treatment Rate
* Assuming a flow back treatment rate of
1.325 m3/minute
1908 m3/day
Crude Oil Recovered from Flow Back
** Assuming a crude oil recovery rate of
10.0 bbl/day
$ 30.00 Cdn$/bbl
Unit Cost & Revenue Estimates
* Estimated from batch test results
18. 18
Endorsements
Company Contact Position Status
Chevron Rudy Tamayo Water Engineer
Husky Roy Guan
ExxonMobil Mark Mcouat Working Prototype
MATRRIX Robert Van Bostelen VP, Operations
Culligan Chris Larson, Technical Sales
XTO Energy Canada Darrell McOuat Water Management
JJ Crew Collaboration
19. Letter of Support: XTO Energy Canada
19
Subject: Western Frac Vap
From: "Mcouat, Darrell /C" <darrell.mcouat@exxonmobil.com>
Date: Mon, May 04, 2015 11:22 am
To: "spencer@westernfracvap.com" <spencer@westernfracvap.com>
Cc: "Taylor, Jamie A" <jamie.a.taylor@exxonmobil.com>, "Bruce,
Dean F" <dean.bruce@exxonmobil.com>
Spencer ,
As per our conversation, XTO Energy Canada has expressed interest in the water conversion process that Western Frac Vap has
introduced to us , your ability to covert flow back frac fluid to meet the AER “Test and Release” criteria. This would allow XTO to
store the converted flow back water in larger and more economical storage containment and reuse this fluid for additional fracs.
XTO has offered Western Frac Vap the opportunity to set up their equipment on a couple of XTO’s locations to execute a pilot with
their mobile equipment . If this technology meets the expectations of the Producer there would be a potential for a long term
relationship with Western Frac Vap.
Thanks and look forward to working with you in the future
Darrell McOuat
Water Management
XTO Energy Canada
Suite 400
321-6th Ave SW
Office 403.766.1057
Cell 587.439.4887