I've been holding this one for over a year. At .0005 that is about as low as it has ever gotten. Lets just say that I paid more than that, however with the price of oil going no where but up, and with this company not only owning and drilling oil properties, but also being able to sell low cost portable steam generators to other oil companies (and since they are portable they don't require the environmental approvals of large permanent installations) unless the company is a scam, I don't see how you can lose. If it goes up to $1 or $2/share, I can retire. Here is some info that was posted previously on this stock by a better investigator than me:
Business Plan
United States Crude International Inc. (U.S. Crude-Symbol USCI) is an oil production and technology company that has some innovative oil recovery technology designed to recover heavy oil from known reserves.
In many cases, up to 80% of the oil in a formation may remain after 30 to 40 years of pumping. Without secondary recovery efforts, such as those using injection technologies this oil will remain in the ground forever. U.S. Crude’s technology utilizes the benefits of steam and gas injection to recover oil from oil formations that would otherwise remain un-produced. The Company has three different technologies that it is developing.The TM-96 Portable Steam Generator, United States Patent Numbers 5,979,549 and 6,129,148 is a portable, self-contained TM-96-10 is 5-20 million BTU/hour system capable of delivering 500 degrees of steam to reservoir depths of up to 2,500 feet.
The TM-98 Portable Thermo-Gas Repressurizing System is capable of injecting as much 1.3 million cubic feet per day of hot inert gas into an oil formation at depths of up to 5,000 feet. This patent-pending technology is designed to provide the reservoir pressure needed to drive crude oil through the formation, to the well and up to the surface.
The TM-9 Deep Steam Generator (DSG) a technology designed to deliver steam to reservoir depths of 5,000 feet and beyond. This device is lowered into the casing of the well air, fuel and water are fed into the unit via coiled tubing and steam is created at the face of the formation.
U.S. Crude was incorporated in 1996 for the purpose of marketing and employing certain patented and patent-pending oil extraction technologies licensed by U.S. Crude from Wave Technology, Inc., a related company. Wave Technology is a research company wholly owned by Thomas Meeks and family, who is also a director and shareholder of U.S. Crude, and further, is the inventor and patent holder on a number of technologies and processes relating to methods of oil extraction.
Dr. Meeks is a preeminent expert in the field of oil extraction. He is noted for patenting and testing the world’s first down-hole steam generator technology, which is capable of delivering steam at depths of up over 5,000 feet for the purpose of harvesting of heavy oil reserves.
U.S. Crude has licensed from Wave Technology, on an exclusive worldwide basis, technologies designed to increase the production of oil wells, in particular, the TM-96 Portable Steam Generator System and the TM-98 Portable Thermo-Gas Repressurizing Unit, which incorporate these technologies. They are intended for use on “stripper” wells, defined by the Interstate Oil and Gas Commission as wells that produce less than ten barrels of oil per day. The TM-96, TM-98, and related technologies are the result of over 20 years of research and development in the oil and gas industry by Dr. Meeks.
The Company intents to do what major oil companies have done for over 38 years in injecting steam and gas to recover crude oil but in a more cost-effective and energy-efficient manner. Because U.S. Crude is a small oil company, and its TM series oil extraction technologies operate on a lower cost basis than equipment employed by other oil companies, it can successfully produce oil with operating costs far below those of major oil companies. The elevated production cost and overhead of these larger companies, in many cases, do not make it cost-effective to spend additional capital to produce oil from stripper wells. Abandonment is a better alternative than to continue to produce at low production levels.
TM-96 Portable Steam Generator System
The TM-96 Portable Steam Generator, United States Patent Numbers 5,979,549 and 6,129,148 is capable of stimulating production from oil wells with known reserves. Many of these wells have fallen below profitable production levels and require enhanced recovery efforts in order to harvest their oil. The portable, self-contained TM-96-10 is 10 million BTU/hour system capable of delivering 500 degrees of steam to reservoir depths of up to 2,500 feet.
The TM-96-10 is ASME approved and exceeds emission standards even within California, home to the most stringent air quality rules in the world. This trailer-mounted system is an attractive, cost effective alternative to the large, cumbersome and unwieldy stationary systems currently employed to produce steam. There is no need for long and expensive piping to bring the steam to the wells, as the TM-96-10 can be set up in relatively close proximity to the wells. Thermal loss is also reduced due to the short distance for the steam to travel.
The self-contained trailer-mounted TM-96 Portable Steam Generator System includes an electronic generator, high pressure water pump, a drumless hot water/steam generator, water system, and a computerized control panel. The unit is easily moved from well to well during a steam program. What makes this design different from other steam generator designs is that the water stays in a liquid state throughout the heating phase and flashing to steam occurs outside of the steam generator. Because of this design water quality problems are eliminated. Whereas, fresh water is the preferred choice, this design can even deliver treated produced water (brine) or even sea water into an oil formation. This is especially important in areas where fresh water isn’t abundant or in formations where fresh water swells the clay in the formation. Propane is the fuel of choice because of its mobility, and availability; however natural gas or oil can be used if required.
Four primary mechanisms are at work during steam injection:
1) Viscosity reduction by heat
2) Hydrocarbon distillation
3) Displacement (once the steam condenses back to water)
4) Repressurization of the formation
Geological study has found that steam injection is highly effective in harvesting high- viscosity, low-gravity oil. In many cases, up to 80% of the oil in a formation may remain after 30 to 40 years of pumping. Without secondary recovery efforts, such as those using the TM-96 Portable Steam Generator, this oil will remain in the ground forever.
TM-98 Portable Thermo - Gas Repressurizing System
The TM-98 Portable Thermo-Gas Repressurizing System is capable of injecting as much 1.3 million cubic feet per day of hot inert gas into an oil formation at depths of up to 5,000 feet. This patent-pending technology is designed to provide the reservoir pressure needed to drive crude oil through the formation, to the well and up to the surface. The targets for this technology are the thousands of gas-depleted formations around the world. Without sufficient pressure to move the oil, this valuable resource will stay in the ground forever.
The injection of thermal gases works much like steam injection. The primary difference is that the combustion gases do not condense back to water, as does steam. Carbon dioxide, carbon monoxide, and nitrogen in the gases have properties that aid in the recovery of crude oil. Thermal gases may also work better in formations with high clay contents and other formations where steam is not effective or in formations where water is not readily available.
FIXME Bench testing of the TM-98 System The high pressure burner system of the TM-98 during testing.
The TM-98 Thermo-Gas Repressurizing System does not entirely replace conventional steam technology, but it will improve steam’s effectiveness. The TM-98 can be used in conjunction with U.S. Crude’s TM-96 Portable Steam Generator System to improve recovery. They will work with both light and heavy oil formations, depending on the particular condition of the reservoir.
Industry Overview
According to the U.S. Department of Energy, marginal wells, such as those acquired by the Company, often retain 80% of their oil even after pumping 30 to 40 years of primary recovery methods. Without some form of enhanced oil recovery technology to extract it, this remaining oil will remain in the ground forever.
In 2000, the Interstate Oil and Gas Commission estimated there were 411,793 stripper wells in the U.S. producing more than 326 million barrels of oil annually. These wells represented 29% of the oil produced in the United States.
Today’s oil prices are at historically high levels, due in part to OPEC and the other oil producing countries setting quotas that they all have been able to comply with. These quotas have helped to limit the amount of oil that is available in the marketplace thereby drying up the excess oil, which drove prices to historical lows. These higher prices are slated to remain stable throughout the foreseeable future.
Many experts also believe that, with current production rates, even without quotas, the supply of conventional oil will be unable to meet the growing demand within the next ten years. Some analysts even predict that the 50% of the world’s current reserves, after factoring for future production at current rates, will be depleted by 2015.
Nowhere in the world will this demand shortfall be more pronounced than in Asia. Asia already uses a staggering 70% of all newly discovered oil, and that demand is expected to double in the next ten years. One expert from the World Bank estimates that Asia will spend over $150 billion a year on its power infrastructure alone. These astounding figures suggest that if additional oil is not discovered, or if existing oil recovery efforts are not enhanced to meet the growing demand, a significant conflict over oil may be imminent. In any case, the world requires more oil to cover this growing demand and without technology this oil will never become available.
Oil Recovery
Conventional steaming of oil wells involves producing steam above the surface that is then piped into the ground to the reservoir depth to assist in the recovery of the crude oil. During this process, a large portion of the thermal energy produced is lost on the way from the generator to the oil producing region. Governmental studies show that as much as 60% of the thermal energy is lost.
Crude oil is produced by primary or enhanced recovery methods. Primary recovery refers to recovery by means of “pressure energy” initially present in the reservoir at the time of discovery. When that energy and/or pressure subsides or is exhausted, the production of oil slows down and may even stop. The next step to recover this oil is to utilize some enhanced recovery methods. These methods include injecting fluids, such as chemicals to create chemical reactions in the oil formation, water or steam for displacement of the oil, or gases like nitrogen or fire flooding to rebuild pressure. These recovery methods are designed to introduce additional energy back into the formation to assist in the recovery of the oil. Of all of the methods employed in an oil field, steaming has proven to be the most productive method utilized for recovering oil. Steaming process accounts for 77% of all oil produced by enhanced secondary methods.
Four primary mechanisms are at work during steam injection:viscosity reduction by heat, hydrocarbon distillation, displacement (once the steam condenses back to water), Repressurization of the formation
The process of steaming wells with devices that produce steam above ground is an excellent method of recovering oil in reservoirs that are shallower than 2,500 feet below ground. These methods have accounted for the recovery of billions of barrels of oil. Conventional steaming involves a central stationary steam plant that provides steam to a number of wells. This method loses a majority of the thermal energy on its way to the reservoir. In contrast, U.S. Crude utilizes cyclic steaming as its method of steaming oil wells. (See graphics)
Cyclic Steam Injection
Cyclic steam stimulation, or “huff and puff,” is a single well operation for crude oil enhancement. Steam/hot water is injected into the well for a period of anywhere from a few days to a few weeks, depending on the geological characteristics of the reservoir and the rate of return of the process. The well is usually returned back to production after a short soak period, in which the heat is allowed to radiate throughout the heated region. The well then produces oil at an accelerated rate for several weeks, months or up to a year. As many as 15 cycles may be employed if the oil production rate is high enough to remain economically viable.
Effective stimulation results from the injected heat and pressure that reduce the viscosity of the cold viscous oil contained in the reservoir, causing the oil to become considerably more mobilized and improving the efficiency of the pumping mechanism. The generator is set up within the allowable distance from the well, minimizing thermal losses normally associated with conventional steaming. Cyclic steaming is designed for wells 2,500 feet or less.
Steam Flooding Utilizing Stationary Steam Generators
Steam flooding is the most widely used method of steaming oil wells. This is an effective method of providing energy to push crude oil to the well shaft, allowing it to be pumped to the surface. Billions of barrels of oil have been produced using this method over the last 40 years. The process utilizes a large stationary generator that provides steam for ten to fifteen (10-15) wells. The steam produced travels through a piping system to each injector well. The wells must be in close proximity to each other so that the heat will travel to the adjacent wells. This is a very expensive process because the centralized steam generator system, scrubber, water system and piping system cost over $1 million dollars to install on an oil property, and the pollution control device (scrubber) costs hundreds of thousands of dollars annually to maintain.
In some cases, the produced steam has to travel long distances to the well, then down the well to the target zone. The steam often loses as much as 60% of its original thermal energy traveling to its destination. Since steam will travel to the least path of resistance, it is possible that some wells will get steam, and others will get nothing.
Sales and Marketing
The Company’s marketing strategy is designed to establish U.S. Crude as the premier supplier of thermal extraction technologies with major and independent operators of oil wells. The Company will be seeking to obtain an interest in the ongoing oil production from wells using the technology.
The Company has identified the following specific customer types to which it will market its products:
1) Independent Oil Well Operators - The Company intends to enter into an arrangement with independent producers whereby the Company will supply equipment to the operator, on a purchase or a lease-to-purchase basis, to enhance oil production. In addition, the Company will work with the producers staff, training them as to how the systems operates, and further offer the assistance of the Company’s engineers to maximize oil production.
2) Joint Venture Partners - The Company intends to enter into joint venture arrangements with operators who wish to enhance their oil production but do not have capital to acquire our equipment. Our intent is to share the increased production on a 50/50 basis. U.S. Crude will initially provide the equipment for the venture. The operator will pay for fuel and water. After this initial start-up period, all expenses will be paid by the increased oil production.
3) Outright Sales - In certain circumstances, the Company will sell equipment outright for cash without an ongoing royalty participation. This is especially the case with major oil companies and foreign oil companies.
4) Steam Service- The Company intends to assemble a fleet of TM-96-10 steam units and TM-98 gas units that will be sent out daily to operators. The plan includes selling steam and gas on a per barrel basis.
There is an enormous opportunity for this technology internationally through equipment sales and steam service.
The application of portable steam generation equipment is very important to a project where the end user cannot afford the capital expenditure of a large stationary plant to produce steam to enhance recovery. The equipment could also be utilized to determine the feasibility of steaming before large steam projects are implemented or just enhance a smaller project.
Trade Shows- Each year there are numerous oil and gas trade shows around the country attended by potential end users for our products. The Company will attend these shows to help market its technology to the industry. These shows will increase awareness of our products and increase sales of the technology.
Joint Ventures
In an effort to make this technology available to independent operators throughout the United States and Canada, the Company is seeking to develop joint venture projects with independent operators and major oil companies. The goal is to make the TM-96 series technologies available to operators who have ideal reservoir characteristics that are known to respond to steam injection. The venture will include U.S. Crude providing the technology initially and the operator supplying the wells; all revenue produced as a result of the venture will be divided on a 50/50 basis.
Under a joint venture project with U.S. Crude, the operator must have oil wells or acquire wells. Heavy oil is preferable with these ventures because steam remarkably enhances the recovery of this kind of oil. The engineering, reservoir data and enhancement methods previously employed will be evaluated to determine the possible success of the venture. The steaming method that will be employed during the venture is cyclic steam injection (see section on this method). The 10 million b.t.u. TM-96 Portable Steam/Hot Water Generator will be utilized during this joint venture. The device is designed to stimulate one well at a time however, if wells are in close proximity two wells may be steamed. The device is moved from well to well periodically, and steam is injected to improve oil recovery. Depending on the oil formation characteristics, wells may be steamed for days to weeks. Depending on the amount of wells, the duration of steam cycles and the response, the number of steam generators required will be determined.
The joint venture will require U.S. Crude to provide the initial equipment and the operator will pay for fuel and water. As oil is produced, the revenue is divided with 50% of the income going to U.S. Crude and the remaining 50% going to the operator. As additional equipment is needed to fully develop the oil field collectively, the parties can acquire additional TM-96 Portable Steam Generators on a purchase or lease purchase basis.
Steam Service Company
In addition to acquiring and producing oil and gas and marketing its innovative steam and thermal gas injection technologies, the Company can provide oil producers, large and small, with steam and thermal gas injection services in order to enhance the production of oil from their wells. The Company’s plan is to operate the TM-96 Portable Steam Generator (the “TM-96” patent #6,129,148 & 5,979,549), and TM-98 Portable Thermo-Gas Repressurizing Unit (the “TM-98”) patent pending, separately or in tandem, on the operators’ oil wells and sell to them the steam and gas that is produced and injected into their wells.
In conjunction with its technologies, the Company will utilize a satellite-imaging technology, at its own cost, on its steam and/or gas injection projects. The Company and/or its customers can utilize this satellite-imaging technology. The Company will utilize this technology for placement of its technology within the oil field. Our customers may utilize the satellite images to determine where oil may have banked-up in the formation. These banked-up locations may be determined as additional drilling possibilities.
Steam service is beneficial to oil producers as they will not need to make any capital investments in order to realize the benefits from these technologies. The Company will own, operate and maintain the equipment in its own name. All that the customer or end-user is responsible for is to provide the fuel and water necessary to operate the equipment and for operations at an agreed upon price. The typical price will be $1.00 per barrel of steam produced. Each device will produce up to 1,200 barrels of steam daily. The steam and/or gas that the Company produces is injected into customers wells to enhance recovery. Any increased oil production from the steam and/or gas injection belongs exclusively to the producer.
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