A perfected five-minute elevator pitch had the potential to set some startup companies touting new energy technology on the path toward landing investment dollars or valuable members to their management teams.
As part of the Rice Alliance Energy & Clean Technology Venture Forum, representatives from companies with emerging technologies got a chance to hook up with investors and other business executives, who in turn got to learn about promising new technologies for the oil and gas industry.
Just more than 50 companies were scheduled to present during the Sept. 11 event at Rice University. Brad Burke, managing director for the Rice Alliance, said it was probably the highest number of company presentations ever done at such an event. A representative from each startup was given only five minutes to present, hoping to sway investors in the audience their way. The event also included a showcase and what Burke called office hours, or essentially a speed networking event during which about 42 investor groups and about 75 individual investors met with the startups.
“There were about 415 individual meetings [Sept. 10] between investors and startups,” Burke said. “Hopefully, there were some love connections made in those speed dates, and maybe some checks will be written at some point.”
The diverse list of companies covered the spectrum. Some pushed what they said were lower-cost, faster seismic acquisition and processing technology, while others touted solutions for asset monitoring and predicting equipment failure. Biota Technology spoke of the emergence of microbial data to predict reservoir quality, while others put new materials into the spotlight like Modumetal and its new class of protective metal alloys or MTPV Power Corp.’s semiconductor chips that convert heat directly into electricity.
Chris Neale, president of Fracture ID, pointed out the natural heterogeneity of shales and illustrated how production logging revealed that after six months of production only three of 12 perforated intervals were producing at one well. “What Fracture ID uses is a relatively inexpensive acquisition tool behind the drillbit,” he explained, adding that the service helps operators determine where to perforate and make adjustments while drilling. As described in the forum program, “the technology utilizes high-frequency drillbit noise and drilling dynamics data to identify natural fracture swarms and brittle, higher mechanical strength rock, both of which have a significant effort on completions efficiency.”
Panos Adamopoulos, CEO of Seismos, introduced technology that provides real-time monitoring of underground fluid flows inside the reservoir during production. He used as example lost CO2 during EOR, saying operators are blind to what is happening underground and that oil not produced because CO2 was not effective is costing billions of dollars.
Seismos’ technology is focused on noise, a small subsegment of low-frequency waves that travel laterally inside the reservoir. The company is currently focused on EOR production but could launch frack-related products. “We provide real-time information on the spot, showing producers where the fluids migrate during production inside the field,” Adamopoulos said during his five-minute pitch.
Presenting companies as well as others seeking funding have their work cut out for them given today’s investment climate. Jim Sledzik, senior partner and president of Energy Ventures, said that spending by major energy companies has been increasing but earnings have been decreasing, meaning future spending will likely decrease. “I think that’s a concern for everyone in here,” he said.
So what is the inevitable winner going forward? The answer is technology that is cheap, fast and good, according to Sledzik, who noted that this is where companies want to be, although they may find it difficult to accomplish all three characteristics.
However, “cheap is going to be a winner pretty much all the time. That’s going to be a driver going forward, certainly for the near term,” Sledzik said. “If you have a technology that makes it cheaper for the companies to operate and to get oil and gas out of the ground, that is going to be something that the oil industry is going to demand.”
He added that when a company has a technology that improves performance and reduces cost, it’s also a winner.
Cross-fertilization, or technology that comes from other industries, is among the kinds of spaces Energy Ventures looks at when considering investment opportunities. One such application is the use of CAT scanning technology, which is used in the medical field but can also be used in the oil field to digitally scan cores from oil and gas wells.
“I think the future is bright for oil and gas technology investing,” Sledzik said, later adding, “I think the world is rich with technology. It just becomes the question of how do you apply it.”
Contact the author, Velda Addison, at vaddison@hartenergy.com.
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