Kelso Technologies Inc. - Crude by Rail Technology Update
April 10 2018 - 08:00AM
Kelso Technologies Inc. (“Kelso” or the “Company”), (TSX:KLS),
(NYSE American:KIQ) reports that an American oil company customer
(“Client”) that has been utilizing the Company’s specialized
crude-by-rail (“CBR”) equipment has proven the economic benefits
and effectiveness of Kelso’s technologies over an extended period
of time.
Over the years Kelso, as a development
organization, has built a good reputation as a designer and
reliable supplier of specialized high performance rail tank car
equipment that provides for the safe handling and containment of
hazardous crude oil during rail transport. The Company’s CBR
products are specifically designed to provide economic and
operational advantages to customers while reducing the potential
effects of human error and environmental harm. The rail
industry appears to be data driven and very slow to adopt new
technologies. Kelso’s challenge has been the demonstration of
the long term performance and economic benefits of the Company’s
products in actual operations.
Kelso’s Client has been operating 2 individual
unit trains consisting of a total of 214 tank cars for
approximately two years. All cars were outfitted with Kelso’s
pressure relief valves and one-bolt manways, and 10 of the cars
were also equipped with Kelso’s vacuum relief valves for field
service trial. The Client reports that the Company’s
technologies have provided faster loading times and quantifiable
economic advantages at their crude oil loading racks. Quicker
sealing time on the Company’s one-bolt manway has allowed the
Client to ship an additional unit train every three months.
This equates to an additional 276,000 barrels of oil annually per
unit train – improving the Client’s overall financial returns on
investment when shipping crude by rail.
Kelso’s equipment has kept the Client regulatory
compliant on mandated containment rules with the added advantage
that gasket life has been significantly extended from being changed
every 6 trips for a standard manway to once every 18 trips for a
one-bolt manway. This represents a major cost savings in
terms of gasket material of $85,000 annually per unit train.
Also demonstrated is an additional savings of approximately
$100,000 annually in manway repair costs by eliminating damage to
manway bolts caused by excessive wear and over tightening.
The Client reports that they have improved their tank car
utilization as cars are not taken out of service for manway related
repairs.
The Client will now be assisting Kelso in
additional product development by putting 5 bottom outlet valves
(BOV) into service trial on its CBR runs. The BOV is the
Company’s unique proprietary technology featuring a ceramic ball
and wiper. It is expected to provide additional operational
benefits for crude by rail service. The AAR service trial is
ongoing and will now include applications in crude oil, molten
sulfur and chemicals.
According to industry sources “Canadian crude by
rail exports are likely to enjoy a renaissance growing from 2017
levels of 150,000 barrels per day to an implied 250,000 barrels per
day in 2018 and to 390,000 – 590,000 barrels per day in 2019.”
There is a lot of production capability in Alberta and limited ways
to transport it as pipelines are at full capacity. Political
battles over new pipeline construction continue in Canada and new
pipeline transmission capability may be a long way from
utilization. In addition to Canadian crude production, Mexico
is also considering rail logistics to service its national needs
for refined petroleum products.
James R. Bond, CEO of the Company comments that
“After a prolonged recession in rail tank car production Kelso is
beginning to experience a momentum shift in demand for the
Company’s rail tank car products. Management believes Kelso’s
rail tank car products more than demonstrate they are “best
available technology” providing numerous benefits to
customers. They are expected to continue to provide
meaningful revenue opportunities for many years to come as oil and
ethanol meet their regulatory compliance by 2023. The success
of Kelso’s Client in demonstrating the safety and economic rewards
the Company’s products offer should assist the crude oil industry
to better understand Kelso’s value proposition and possibly fuel
their acceptance and adoption of the Company’s technologies in the
future.”
About Kelso Technologies
Kelso is an engineering product development
company that specializes in the design, production and distribution
of proprietary service equipment used in transportation
applications. Kelso’s reputation has been earned as a
designer and reliable supplier of unique high performance rail tank
car equipment that provides for the safe handling and containment
of hazardous and non-hazardous commodities during transport.
All Kelso products are specifically designed to provide economic
and operational advantages to customers while reducing the
potential effects of human error and environmental harm. The
Company offers specialized truck tanker equipment, rail wheel
cleaning systems, fuel loading systems, military applications,
first responder emergency response kits and high performance
suspension systems for motor vehicles being used in rugged outback
terrains.
For a more complete business and financial
profile of the Company, please view the Company's website at
www.kelsotech.com and public documents posted under the Company’s
profile on www.sedar.com in Canada and on EDGAR at
www.sec.gov in the United States.
On behalf of the Board of
Directors,
James R. Bond, CEO and President
Legal Notice Regarding Forward-Looking
Statements: This news release contains “forward-looking
statements” within the meaning of applicable securities
legislation. Forward-looking statements are indicated expectations
or intentions. Forward-looking statements in this news release
include that Canadian crude by rail exports are likely to enjoy a
renaissance growing from 2017 levels of 150,000 barrels per day to
an implied 250,000 barrels per day in 2018 and to 390,000 – 590,000
barrels per day in 2019; that after a prolonged recession in rail
tank car production Kelso is beginning to experience a momentum
shift in demand for the Company’s rail tank car products; that
management believes the Company’s rail tank car products more than
demonstrate they are “best available technology” providing numerous
benefits to customers; that the Company’s CBR products are expected
to continue to provide meaningful revenue opportunities for many
years to come as oil and ethanol meet their regulatory compliance
by 2023; that the success of the Company’s Client in demonstrating
the safety and economic rewards the Company’s products offer should
assist the crude oil industry to better understand the Company’s
value proposition and possibly fuel their acceptance and adoption
of the Company’s technologies in the future. Although Kelso
believes its anticipated future results, performance or
achievements expressed or implied by the forward-looking statements
and information are based upon reasonable assumptions and
expectations, they can give no assurance that such expectations
will prove to be correct. The reader should not place undue
reliance on forward-looking statements and information as such
statements and information involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of Kelso to differ materially from
anticipated future results, performance or achievement expressed or
implied by such forward-looking statements and information,
including without limitation the risk that regulatory deadlines for
compliance may be delayed or cancelled; the Company’s products may
not provide the intended economic or operational advantages; or
reduce the potential effects of human error and environmental harm
during the transport of hazardous materials; or grow and sustain
anticipated revenue streams; orders may be cancelled and
competitors may enter the market with new product offerings which
could capture some of the Company’s market share; and the Company’s
new equipment offerings may not capture market share as well as
expected. Except as required by law, the Company does not
intend to update the forward-looking information and
forward-looking statements contained in this news release.
For further information, please contact:
James R. Bond, CEO and
President |
Richard Lee, Chief
Financial Officer |
Corporate
Address: |
Email:
bond@kelsotech.com |
Email:
lee@kelsotech.com |
13966 -
18B Avenue |
|
|
South
Surrey, BC V4A 8J1 |
|
|
www.kelsotech.com |
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