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Ionizer Sludge Recovery System
                      April 6, 2010
Bootstrap System: 400 b/d*
                                                                                               Start by filling the 210 bbl
                                                                                                mixing tank halfway with
                                                                                             sludge, then cover with diesel




                                                   Diesel
                                        Pump                             Ionizer**
                                                   Sludge               (circulate 3
                                                                           times)              Generator


                                               2x 210 bbl tanks            Sit for
                                                                         4-6 hours




                                                   Sludge-
                                                   Diesel                                       ‡ This
                                                                                                     crude oil should be saleable, but
*The system should safely operate one              Mixture
                                                                  **Ionizer & pump sit on       may incur a slight discount for falling
 cycles per day at 400b/d each. With
                                                                    a trailer and services     outside the tight contract specification.
   experience a second cycle may be
     charged in the evening and sit                                both tanks. Circulating
         overnight for 800 b/d.                                    the tank 3x takes ~45
                                                                   minutes. Repositioning
                                                                    takes 15-30 minutes
                                                                                                                                   2
Bootstrap System: 400-800 b/d

                                                       Project
    Bootstrap System        Spec     Unit Cost   No.    Cost                                Comments
Diesel Trucks                                                    Pump directly from delivery truck; no capex
Mixing Tanks               210 bbl    $15.0k      2    $30.0k    API, 12 guage, galvinized, hatch, manhole, mangate, steps, etc.
                                                                 Moveable built tank snaps into place in 2hrs. Cheaper tanks
                                                                 may be sourced locally or, say, Romania
Tank valves & fittings                $1.0k       2    $2.0k     Welding on pipe work to aid circulating the sludge-diesel mix
Stinger                               $0.5k       1    $0.5k     Manually operated; used for first circulation when required
Generator                  diesel     $5.0k       1    $5.0k     Check local pricing
Ionizer + pump + trailer              $25.0k      1    $25.0k
TAN control mixer                     $1.0k       1    $1.0k     For Nalco dry base chemical
Field laboratory                      $3.0k       1    $3.0k
Sub-Total                                         1    $66.5k
Transport & contingency     30%                   1    $20.0k
Total Bootstrap System                            1    $86.5k                           400-800 bbls/day




                                                                                                                               3
Basic System: 800 b/d*                                                                                 *The system should safely
                                                                                                     operate 2 cycles at 400b/d each.
                                                                                                       With experience a third cycle
                                                                                                      may be charged in the evening
                                                                   Start by filling the 210 bbl       and sit overnight for 1200 b/d
                                                                    mixing tank halfway with
                                                                 sludge, then cover with diesel




                             Diesel                                                Off Gases
Generator         Pump                             Ionizer**
                             Sludge               (circulate 3
                                                     times)


                         2x 210 bbl tanks            Sit for
                                                   4-6 hours

         Diesel
        Storage                                                             Heater
                                                                            Treater                       Finished
                             Sludge-                                                                      Product
                             Diesel                                                                       Storage
        210 bbl              Mixture
                                            **Ionizer & pump sit on
         tank
                                              a trailer and services
                                             both tanks. Circulating                   Trace Water
                                             the tank 3x takes ~45                                         1500 bbl
                                             minutes. Repositioning                                          tank
                                              takes 15-30 minutes
                                                                                                                                  4
Basic System: 800-1200 b/d
                                                        Project
      Basic System          Spec      Unit Cost   No.                                        Comments
                                                         Cost
                                                                  Bootstrapping by loading from tanker trucks directly may be
Diesel Storage Tank        210 bbl     $15.0k      1    $15.0k
                                                                  possible, but risks production delays
Diesel pump & hose                     $0.5k       1     $0.5k
                                                                  API, 12 guage, galvinized, hatch, manhole, mangate, steps, etc.
Mixing Tanks               210 bbl     $15.0k      2    $30.0k    Moveable built tank snaps into place in 2hrs. Cheaper tanks
                                                                  may be sourced locally or, say, Romania
Tank valves & fittings                 $1.0k       4     $4.0k    Welding on pipe work to aid circulating the sludge-diesel mix
Stinger                                $0.5k       1     $0.5k    Manually operated; used for first circulation when required
                                                                  Simple boiler attached to loop of piping at the bottom of
Tank Heaters               steam       $3.0k       2     $6.0k
                                                                  mixing tanks. Can probably fitted in locally
Generator                  diesel      $5.0k       1    $5.0k     Check local pricing
Ionizer + pump + trailer               $25.0k      1    $25.0k
                                                                  This is for a high quality unit from the USA; local ones with
Heater Treater                         $25.0k      1    $25.0k
                                                                  simple controls should be cheaper w/ the usual caveats
H-Treat pump & hose                    $0.5k       1     $0.5k
                                                                  Bootstrapping by using a smaller, cheaper tank may be
Finished Product Tank      1500 bbl    $25.0k      1    $25.0k
                                                                  possible, but risk disrupting production.
TAN control mixer                      $1.0k       1     $1.0k    For Nalco dry base chemical
Field laboratory                       $3.0k       1     $3.0k
Sub-Total                                               $137.5k
Transport & contingency      30%                   1     $41.3k
Basic System                                            $178.8k       800 bbls/day; with experience might push to 1200 b/d
Finished Product Tank      1500 bbl    $32.5k      1     $32.5k   Additional tankage (including 30% contingency)
Tank valves & fittings                 $1.3k       1     $1.3k    Welding on pipe work to aid circulating the sludge-diesel mix
Basic w/ xtra Storage                                   $212.6k

                                                                                                                                    5
System Details
        Tank                            Stinger                                       Tank                                        Dry Ice
       Heating                                                                       Cleaning




                                                                                                                                   Heater
                                                                                                                                   Treater


  210 bbl mixing tanks                                                    Substantially all water and solids
   have piping welded            When the sludge is very thick a           will fall from solution in normal
    into the base for          “Stinger” can be used to jet ionized       operation, so the tank will not be
  steam from a boiler          diesel from the 3” outlet pipe into a      drawn all the way to the bottom.                 If dry Ice (frozen CO2) is
   to heat the sludge.        1” pipe onto shear the surface of the       Periodically solids built up on the             available locally, then it can
                              sludge. This should only be necessary       bottom will need to be raked out                be to finish de-watering the
                                   to start the tank circulating.         via a “Man Gate” at the base of                  crude and avoid buying a
                                                                                        the tank                                 Heater Treater



           TAN Reduction                                                                     Storage Capacity
The Ionized diesel will already have reduced TAN to                                  While it’s possible to bootstrap operations with less
   a degree. But after de-watering the crude, it’s                                   storage, in order to keep transportation disruptions
 preferred to use a chemical additive from Nalco to            Finished             from shutting down the process, the site should build
                     adjust TAN                                Product                   up to having storage = 3x daily production
                                                               Storage
                                                                                                                                                     6
*The system should safely operate 2
                                                                                                      shifts at 800b/d each. With
                                                                                                    experience a third cycle may be
Expansion to 1600 b/d*                                                                             charged in the evening and sit over
                                                                                                            night for 2400 b/d




                        Diesel                                             Off Gases                   Finished
                                               Ionizer
                                                                                                       Product
                Pump                         (circulate 3
                                                                                                      Storage #2
                        Sludge                  times)




  Diesel
                                 Sludge-
 Storage                                                              Heater
                                 Diesel
                                 Mixture                              Treater                           Finished
                                                                                                        Product
                                                                                                        Storage



                                                                                Trace Water
                        Mixing
                       Tank #3
                                            *Both the Ionizer / Pump
                                             trailer and the Heater-
                                           Treater can service multiple                                             Finished
            Mixing                                     tanks                                                        Product
           Tank #4                                                                    Finished
                                                                                      Product                      Storage #4
                                                                                     Storage #3

                                                                                                                                 7
Expansion System: 1600-2400 b/d

                                                       Project
      Basic System         Spec      Unit Cost   No.    Cost                               Comments
Basic w/ xtra Storage                             1    $212.6k


Mixing Tanks              210 bbl     $15.0k      2    $30.0k
                                                                 API, 12 guage, galvinized, hatch, manhole, mangate, steps, etc.
Tank valves & fittings                $1.0k       6     $6.0k    Welding on pipe work to aid circulating the sludge-diesel mix
                                                                 Simple boiler attached to loop of piping at the bottom of
Tank Heaters              steam       $3.0k       2     $6.0k
                                                                 mixing tanks. Can probably fitted in locally
                                                                 Bootstrapping by using a smaller, cheaper tank may be
Finished Product Tank     1500 bbl    $25.0k      2    $50.0k
                                                                 possible, but risk disrupting production.
Sub-Total                                         1     $92.0k
Transport & contingency     30%                   1     $27.6k
Total Expansion System                            1    $119.6k       1600 bbls/day; with experience might push to 2400 b/d

Simple + Expansion                                1    $332.2k




                                                                                                                              8

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Tank recovery 5

  • 1. Ionizer Sludge Recovery System April 6, 2010
  • 2. Bootstrap System: 400 b/d* Start by filling the 210 bbl mixing tank halfway with sludge, then cover with diesel Diesel Pump Ionizer** Sludge (circulate 3 times) Generator 2x 210 bbl tanks Sit for 4-6 hours Sludge- Diesel ‡ This crude oil should be saleable, but *The system should safely operate one Mixture **Ionizer & pump sit on may incur a slight discount for falling cycles per day at 400b/d each. With a trailer and services outside the tight contract specification. experience a second cycle may be charged in the evening and sit both tanks. Circulating overnight for 800 b/d. the tank 3x takes ~45 minutes. Repositioning takes 15-30 minutes 2
  • 3. Bootstrap System: 400-800 b/d Project Bootstrap System Spec Unit Cost No. Cost Comments Diesel Trucks Pump directly from delivery truck; no capex Mixing Tanks 210 bbl $15.0k 2 $30.0k API, 12 guage, galvinized, hatch, manhole, mangate, steps, etc. Moveable built tank snaps into place in 2hrs. Cheaper tanks may be sourced locally or, say, Romania Tank valves & fittings $1.0k 2 $2.0k Welding on pipe work to aid circulating the sludge-diesel mix Stinger $0.5k 1 $0.5k Manually operated; used for first circulation when required Generator diesel $5.0k 1 $5.0k Check local pricing Ionizer + pump + trailer $25.0k 1 $25.0k TAN control mixer $1.0k 1 $1.0k For Nalco dry base chemical Field laboratory $3.0k 1 $3.0k Sub-Total 1 $66.5k Transport & contingency 30% 1 $20.0k Total Bootstrap System 1 $86.5k 400-800 bbls/day 3
  • 4. Basic System: 800 b/d* *The system should safely operate 2 cycles at 400b/d each. With experience a third cycle may be charged in the evening Start by filling the 210 bbl and sit overnight for 1200 b/d mixing tank halfway with sludge, then cover with diesel Diesel Off Gases Generator Pump Ionizer** Sludge (circulate 3 times) 2x 210 bbl tanks Sit for 4-6 hours Diesel Storage Heater Treater Finished Sludge- Product Diesel Storage 210 bbl Mixture **Ionizer & pump sit on tank a trailer and services both tanks. Circulating Trace Water the tank 3x takes ~45 1500 bbl minutes. Repositioning tank takes 15-30 minutes 4
  • 5. Basic System: 800-1200 b/d Project Basic System Spec Unit Cost No. Comments Cost Bootstrapping by loading from tanker trucks directly may be Diesel Storage Tank 210 bbl $15.0k 1 $15.0k possible, but risks production delays Diesel pump & hose $0.5k 1 $0.5k API, 12 guage, galvinized, hatch, manhole, mangate, steps, etc. Mixing Tanks 210 bbl $15.0k 2 $30.0k Moveable built tank snaps into place in 2hrs. Cheaper tanks may be sourced locally or, say, Romania Tank valves & fittings $1.0k 4 $4.0k Welding on pipe work to aid circulating the sludge-diesel mix Stinger $0.5k 1 $0.5k Manually operated; used for first circulation when required Simple boiler attached to loop of piping at the bottom of Tank Heaters steam $3.0k 2 $6.0k mixing tanks. Can probably fitted in locally Generator diesel $5.0k 1 $5.0k Check local pricing Ionizer + pump + trailer $25.0k 1 $25.0k This is for a high quality unit from the USA; local ones with Heater Treater $25.0k 1 $25.0k simple controls should be cheaper w/ the usual caveats H-Treat pump & hose $0.5k 1 $0.5k Bootstrapping by using a smaller, cheaper tank may be Finished Product Tank 1500 bbl $25.0k 1 $25.0k possible, but risk disrupting production. TAN control mixer $1.0k 1 $1.0k For Nalco dry base chemical Field laboratory $3.0k 1 $3.0k Sub-Total $137.5k Transport & contingency 30% 1 $41.3k Basic System $178.8k 800 bbls/day; with experience might push to 1200 b/d Finished Product Tank 1500 bbl $32.5k 1 $32.5k Additional tankage (including 30% contingency) Tank valves & fittings $1.3k 1 $1.3k Welding on pipe work to aid circulating the sludge-diesel mix Basic w/ xtra Storage $212.6k 5
  • 6. System Details Tank Stinger Tank Dry Ice Heating Cleaning Heater Treater 210 bbl mixing tanks Substantially all water and solids have piping welded When the sludge is very thick a will fall from solution in normal into the base for “Stinger” can be used to jet ionized operation, so the tank will not be steam from a boiler diesel from the 3” outlet pipe into a drawn all the way to the bottom. If dry Ice (frozen CO2) is to heat the sludge. 1” pipe onto shear the surface of the Periodically solids built up on the available locally, then it can sludge. This should only be necessary bottom will need to be raked out be to finish de-watering the to start the tank circulating. via a “Man Gate” at the base of crude and avoid buying a the tank Heater Treater TAN Reduction Storage Capacity The Ionized diesel will already have reduced TAN to While it’s possible to bootstrap operations with less a degree. But after de-watering the crude, it’s storage, in order to keep transportation disruptions preferred to use a chemical additive from Nalco to Finished from shutting down the process, the site should build adjust TAN Product up to having storage = 3x daily production Storage 6
  • 7. *The system should safely operate 2 shifts at 800b/d each. With experience a third cycle may be Expansion to 1600 b/d* charged in the evening and sit over night for 2400 b/d Diesel Off Gases Finished Ionizer Product Pump (circulate 3 Storage #2 Sludge times) Diesel Sludge- Storage Heater Diesel Mixture Treater Finished Product Storage Trace Water Mixing Tank #3 *Both the Ionizer / Pump trailer and the Heater- Treater can service multiple Finished Mixing tanks Product Tank #4 Finished Product Storage #4 Storage #3 7
  • 8. Expansion System: 1600-2400 b/d Project Basic System Spec Unit Cost No. Cost Comments Basic w/ xtra Storage 1 $212.6k Mixing Tanks 210 bbl $15.0k 2 $30.0k API, 12 guage, galvinized, hatch, manhole, mangate, steps, etc. Tank valves & fittings $1.0k 6 $6.0k Welding on pipe work to aid circulating the sludge-diesel mix Simple boiler attached to loop of piping at the bottom of Tank Heaters steam $3.0k 2 $6.0k mixing tanks. Can probably fitted in locally Bootstrapping by using a smaller, cheaper tank may be Finished Product Tank 1500 bbl $25.0k 2 $50.0k possible, but risk disrupting production. Sub-Total 1 $92.0k Transport & contingency 30% 1 $27.6k Total Expansion System 1 $119.6k 1600 bbls/day; with experience might push to 2400 b/d Simple + Expansion 1 $332.2k 8