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Bleedin' asterisks! Just enter Directors Talk interviews instead of the asterisks and you'll get the link.
The Norway testing of the "gamechanger" SABER is just "weeks away" and is scheduled in. Worth emphasising that the principle behind SABER has already been proven by Shell, and so just has to be verified in the field:
Https://www.***************************/enteq-technologies-investor-presentation-2023/4121093847
It's been rising each of the last few days, and is up a full 1p today already.
Intriguing!
New article from NTQ about SABER and geothermal energy:
Https://www.enteq.com/news-media/2022/11/geothermal-energy-heating-up-the-industry/
"Our Steer-At-Bit Enteq Rotary (SABER) Tool represents a radical evolution in RSS design, capable of reliable HPHT performance and greater uptime thanks to a mechanically simple design and at-the-bit steering.
We believe that the SABER Tool can play a key role for the geothermal sector for three main reasons:
The greater uptime and reliability improve project economics – critical in geothermal where capex is higher, and rewards are less immediately lucrative.
Drilling deeper brings harder rock. The inherent design of the SABER Tool decouples the internal platform and electronics from strong torsional vibration effects induced by the bit for improved reliability.
The SABER Tool has been designed from the start to be reliable in the HPHT environments typical of geothermal applications, with a specified max temperature of 175°C.
President Joe Biden has recently signed into law the Inflation Reduction Act which, despite the name, could prove an incredibly significant piece of energy legislation, with as much as $350 billion in loans and loan guarantees for energy and automotive companies – with the help of engineering developments such as the SABER Tool, a slice of that could transform the geothermal energy landscape and put the sector back on track to fulfil its potential contribution to Net Zero."
This follows an earlier article about removing methane using SABER:
Https://www.enteq.com/news-media/2022/10/methane-abatement-mining/
"SABER is currently aimed at use for its more obvious applications in the oil and gas industry, but it has also performed initial testing for its use for methane abatement.
SABER offers:
A cost-effective solution for methane abatement before mining
Greater reliability through simple and enhanced design
Improved safety for people, planet and the environment
Methane abatement in the mining sector is becoming more and more important. The United States Environmental Protection Agency (EPA) launched its Coalbed Methane Outreach Program (CMOP) which aims to reduce methane emissions from coal mining activities, and the Global Methane Initiative, of which Enteq is a member, also places strategic importance on reductions of methane emissions in mining too.
As a global industry, mining still has a role to play in many energy ecosystems around the world. It’s key that we make this industry as environmentally sound as we possibly can and to do that, we need to have open and honest discussions about making meaningful impacts."
The US rig count was up by another three last week to 782, compared to 563 this time last year:
Https://www.workboat.com/offshore/baker-hughes-us-rig-count-increases-by-three-from-last-week
Wednesday's interims were certainly better than I expected given the improvement to a positive EBITDA. The core MWD business may yet see quite a substantial improvement given (1) the US rig count still rising steadily, (2) a likely bounce in international sales and (3) a return of higher margin non third party equipment sales.
Cash is pleasingly up to $2.5m and will be supported by recovery of receivables, plus there's the potential $2m from the Houston property sale, so plenty of funding to see SABER through to full commercialisation for some time to come.
Great to see the CEO buying 100,000 more shares immediately post-interims. This would have been one of the few ideal windows for him to do so given that results are just out and there's a brief news flow gap before results of SABER trials in Norway and of field trials with customers.
Have we picked up anything on below 21st Sept statement.... Have they actually won any commercial contracts yet with SABER...
Thanks. DYOR
" A full active drilling test site has been booked in Norway and commercial agreements for field trials, initially in the Middle East, are being concluded with the expectation of commercial operations closer to the end of this calendar year. "
Yesterday there was somethiing like £100K of transactions and today even less. Looking at the price move without looking at the volume vs free float is only half the picture. when Saber is released and generating revenue the volume of sells will be reversed in no time and the price recover +++. £20M+ market cap in no time imho. A treble? Whereas will you find that with a management that is into this upto their necks. They have to make it a success.
Have been buying.
At least SABER has "now successfully passed all stages of passive testing". And active drilling and field trials are starting soon.
I'd been expecting the core business to be thriving, but it seems to be merely stable/stale. Where have all these new competitors suddenly come from, and how did they survive the downturn so successfully?
It seems that the Houston property might be sold, which is what they mean by using existing assets to fund SABER etc going forward.
Mopping up a few as a punt. They only released full news on new MWD on the 6th Sept with the emphasis on SABER for usage. They are looking to move out of the way of commodity MWD that has turned up in the market. That should help future margins if you read up on the increased reliability and SABER should pull those sales through.
Buy now as a punt as Saber will offer MWD pull through and bring MWD back. A gamble but the upside looks decent vs downside as SABER must be made to succeed and management are in the shares up to their necks. Darkest hour and all that.
184 quid at the higher price is diddly squat. Higher price doesnt mean anything without some volume behind it.
Good to see the late tock up on Friday, and now a small buyer has paid 15.38p.
Perhaps an overhang has cleared.
The AGM trading statement is on 21st September, so not long to wait.
Much to look forward to:
- the core business is surely doing better and better in the current environment in the energy sector and with the US drill count having increased so much in the last year
- hopefully we'll get some an update on SABER and its continuing commercialisation this year
It's worth reiterating that the forecast for this year is 1.7c EPS, i.e around 1.5p EPS, with a closing cash pile of $3m against the £10m m/cap.
It can also be used in geothermal and in methane abatement:
Https://oilreviewmiddleeast.com/exploration-production/enteq-launches-xxt-hop-series-realtime-communications-solution-for-drilling
"Enteq launches XXT-Hop series realtime communications solution for drilling
Created: Monday, 05 September 2022 10:00
Enteq, the energy services technology and equipment supplier, has announced the launch of the XXT-Hop series, a real time communications solution for RSS and MWD operations
The system will allow drilling contractors to access real time data during live operations and offers a more efficient solution for operating equipment, which can significantly improve drilling performance, efficiency and return on investment.
The communications device can be used in conjunction with Enteq’s innovative rotary steerable system (RSS), The SABER Tool, or configured to work with existing RSS and measurement while drilling (MWD) systems. It utilises drop-in modules, consisting of a transmitter fitted above the RSS, which connects with a receiver in the MWD string to offer seamless integration and send real-time drilling data to the surface.
The XXT-Hop series removes the need for physical connectors, dedicated collar lengths and enables logging while drilling (LWD) to be run below MWD equipment rather than above, taking it much closer to the bit.
A version of the XXT-Hop series is currently in development with a range of 25 metres, which would allow MWD to run above the motor, leading to notable improvements in tool life.
While the primary function of the XXT-Hop series is to support operators and drilling contractors in the oil and gas industry, but it has also been designed for the wider energy transition sectors which Enteq supports, such as geothermal drilling and methane abatement.
Neil Bird, VP Advanced Drilling Systems at Enteq Technologies, said, “The XXT-Hop series uses existing concepts and trusted technology to provide operators assurances on the reliability of the equipment, the value of the data being received and peace of mind that they have the right tools in place. Its implementation also negates the need to delay decision-making following analysis of data or downhole testing and will lead to significant reductions in downtime caused by unnecessary wear to equipment.
“This system’s readiness to be used with other RSS and MWD systems on the market, and integrate with existing fleets seamlessly, offers enhanced performance without the need for significant turnover of equipment. The XXT-Hop series is also ready for renewable or environmental applications, such as geothermal drilling and methane abatement, adding to its flexibility and versatility - a key consideration for operators in a new market landscape.”
The XXT-Hop series has been developed to meet market demand with an initial range of 5m / 16ft for standard equipment set up, and Enteq is currently developing a future version that will be suitable for ranges
The weekly rig count rose by 3 last week to 765, and is essentially stable at the moment and some 257 rigs higher than the rig count this time in 2021:
Https://oilprice.com/Energy/Energy-General/Oil-Rig-Count-Climbs-As-Permian-Drilling-Picks-Up.html
Nice article from Suki Gill of Enteq in Oil Review Middle East latest issue p.32-33 on MWD (doesn’t reference SABER specifically):
Hhttps://www.oilreviewmiddleeast.com/current-issue
The US rig count has drited a tad for the last couple of weeks, but is still up 53% on a year ago:
Https://www.mysanantonio.com/business/oil/article/Rig-count-declines-for-second-consecutive-week-17370626.php
NTQ have issued an expanded version of the report below, with this nice concluding sentences:
Https://www.enteq.com/news-media/2022/08/enteq-technologies-reports-success-following-launch-of-the-saber-tool/
"Enteq Technologies (Enteq), the energy services technology and equipment supplier, announces a 45% increase in revenue in 2022 with new entry into new regions and energy transition sectors. Building on this, the SABER Tool (Steer-At-Bit Enteq Rotary Tool), Enteq’s game-changing alternative to traditional rotary steerable system (RSS) for directional drilling, has successfully achieved its testing milestones to date."
"We have a steady and loyal customer base through our MWD and LWD offering who are incredibly interested in SABER and we’ve put a lot of work into understanding what the market wants – gaining significant interest globally. We’re currently in the position of identifying commercial partners across several regions to facilitate the roll-out of SABER as the industry go to in RSS technology.”
Https://www.oilreviewmiddleeast.com/technical-focus/robust-alternative-to-traditional-rotary-steerable-system
Extract:
"Robust alternative to traditional rotary steerable system
Created: Monday, 01 August 2022"
"The global drilling market is currently estimated to be worth at least US$11bn. Enteq’s chief executive officer, Andrew Law, said, “We know that the drilling market, and in particular the RSS market, is strong. We’re confident this is set to continue into the future, and we’re excited by the potential to use our technology to support energy transition applications. When we set out to commercialise SABER, we wanted to ensure that we were creating an RSS that would improve the efficiency of operations now and well into the future. With SABER, we’re confident that we’re able to do that and we’re looking forward to providing a solution that customers can feel confident in investing in.
“When you look at the oil and gas industry, for example, there are only a handful of businesses supplying the global market in this sector and we know that there is demand there for alternative, innovative technologies.”
Another good week for the rig count, rising another 9 to 767:
Https://boereport.com/2022/07/29/u-s-drillers-add-oil-and-gas-rigs-for-record-24th-month/
Extracts:
"U.S. energy firms this week added oil and natural gas rigs for a record 24 months in a row as oil majors post blowout earnings on surging crude and gas prices.
The oil and gas rig count, an early indicator of future output, rose nine to 767 in the week to July 29, its highest since March 2020, energy services firm Baker Hughes Co said in its closely followed report on Friday.
Baker Hughes said that puts the total rig count up 279, or 57%, over this time last year."
"Demand for hydraulic fracturing equipment is quickly outpacing supply, executives said"
The weekly rig count continues to rise and was up another 2 last week to 758. It was at just 491 a year ago:
Https://rigcount.bakerhughes.com/
The US rig count continues to climb and is now at 756, up 4 on the week:
Https://rigcount.bakerhughes.com/
I've been on hols, but made some notes on the investor presentation which was just before I left which might be of interest:
- SABER is a sticky rental model with ongoing revenues from maintenance, spares and support, and is already in use by prospective customers, with two levels of patent protection from Shell's own design and NTQ's addition and inventions
- the 5 acre Houston site is in the books at $2.5m. So very useful asset backing on top of the $4.8m cash and the $3.5m debtors
- year end debtors are high sue to accelerating Q4 sales and are fully recoverable
- testing has led to "derisking" of SABER and "a better tool" following design refinements. The engineering team are very happy with the finished product, and NTQ are confident of SABER revenues this financial year
- all NTQ's American customers are keen to test SABER. Field testing agreements are already in place, and helpfully NTQ's selected partners have good control over their operatins without having to contact their end customer
- next SABER news flow will be a downhole field trial this year
- NTQ have plenty of cash for SABER and everything else, especially given the £1m O/D facility which will be available immediately on the first SABER sale, so there will be no need to raise money
- SABER are addressing a $2 billion and growing market dominated by two companies, so there's plenty of pent-up demand, particularly from domestic and national energy operators