Technology could impact oil production worldwide

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Although Colorado Springs may not be mentioned in high tech circles in the same breath as Boulder or Silicon Valley, if intellectual property quantifies a techno-hub, Michael Enos is breathing new life into the techno-grapevine as he breathes new life into oil production.

Enos is hopeful that KEMSOL Inc., a subsidiary of his company, The LeVault Companies, will allow oil companies to breathe easier when it comes to efficiency, cost and clean-up.

When Enos started the LeVault Companies in 2002, he formed the LeVault Companies’ Incubator Program, a private technology incubator for “higher risk, larger impact technologies.” The incubator has hatched several technologies, including a wind energy project and biometrics and authentication (identification) technology. The latter two and a few other technology startups are currently on the “back burner,” Enos said.

But KEMSOL Inc. is definitely on the front burner, and could be one of the hottest companies among Enos’ list of entrepreneurial ventures.

“This is the biggest hit so far in terms of market opportunity,” Enos said. “We are developing this company to make a big and lasting difference worldwide.”

A very big difference.

“In the bigger picture, this is huge,” said Dr. Jim Mattoon, an emeritus professor of biology at the University of Colorado at Colorado Springs and the director of the bio-technology center at UCCS. “If Michael can get the backing, it would make a tremendous impact on petroleum production. With oil at about $55 a barrel, this would be an economic boon.”

Separating oil from sand

Mattoon is referring to the two KEMSOL exclusive technologies. One is a surfactant, which is a detergent-like material that helps in the process of extracting oil from sand. The surfactant technology is being developed for the tar sands industry in Canada – the oil sands region of Alberta, which Enos said represents the largest petroleum reserve in the world, with 1.9 trillion barrels of reserves.

He said 330 billion barrels are recoverable with current technologies. By comparison, Enos said there are 260 billion barrels of known petroleum reserves in Saudi Arabia.

Enos believes he can increase Canada’s oil production with the new technology. The surfactant aids in the liberation of bitumen, the crude oil that is found in the sands. “Canada has the only tar sands in the world where there is a thin film of water surrounding the sand grain,” Enos said. “And this allows the oil to be extracted with a hot water process.”

Utah also is rich in tar sands, he said. “KEMSOL may have a solution to extract oil from the Utah tar sands as well,” Enos said. For now, the focus is north.

“We have three objectives: more oil faster, at a lower cost; cleaner oil (lower clay content) and a non-toxic waste stream,” Enos said. Research conducted by the Alberta Research Council has shown, thus far, that KEMSOL’s technology is meeting those objectives and getting noticed by the three oil industry players in Canada.

Enos said Syncrude Canada, LTD, Suncor Energy Inc. and Albian Sands, a Shell project, are interested in the technology. “They have opened opportunities for us to address problem areas within their operations,” he said. Enos spent last week in Canada testing the technologies, which also include another KEMSOL exclusive technology – a cavitation reactor.

The cavitation device reduces the volume of waste in the Canadian waste ponds, which are made up of the sludge that results from the oil and sand separation process. “The waste ponds are more like lakes,” Enos said. “There are more than 600 million barrels of sludge in the ponds and lakes.” KEMSOL technology breaks down the clay emulsion that makes up the sludge. “Imagine a glass jar full of sludge and mud,” Enos said. “Run it through the cavitation device, and the clay will be on the bottom, the clear water will stay in the middle and the oil is left on the top.”

In the end, the cavitation device eliminates the ponds, allows more oil to be recovered and recycles the clay for land fill and road construction use. Enos presented the information to the Alberta Energy Research Institute, which he said is the equivalent to the funding arm of the U.S. Department of Energy. “One of the managers said, ‘If the numbers and data collected this week backs up what we are observing, you’ll have everyone in our office doing cartwheels,'” Enos said.

Many people will be jumping for joy, including Enos, if the research corroborates the potential impact of the two technologies. “This technology can reduce U.S. dependence on the Middle East,” Enos said. “Currently, Canada supplies the U.S. with 15 percent of its oil.”

The surfactant also has been identified for 11 additional markets that Enos said he is unable to discuss at this point.

History of entrepreneurial success

With possibilities as vast as the oil sands region in Canada, Enos could make a huge dent in the way oil companies operate. It’s not the first time he has made an imprint in the development of intellectual property.

A Colorado State University graduate and hydro-geologist by trade, Enos returned to the Pikes Peak Region in 1997 after a seven-year stint in the San Francisco Bay Area, where he consulted on ground water hydrology for major companies. Tired of mere pats on the back for his ingenious problem solving, Enos decided his skills would be better served as an entrepreneur.

His inventiveness went beyond his environmental engineering background.

In 1997, he founded HIS Financial Services Corp., a payment technology company that specialized in electronic check conversion. Four years later, Concord EFS bought HIS; First Data Corp. eventually bought Concord.

The HIS acquisition roused the entrepreneurial spirit in Enos. So when a retired Springs construction worker walked into his incubator office after discovering the property in a solution that cleaned up the oil spill on his driveway, Enos delved a bit further. He liked what he saw and contracted Mattoon to help with the advanced bio-technology aspects of the surfactant. Enos bought the rights to the intellectual property from the retired construction worker.

“Michael then got a hold of some oil sands, did a few simple tests and found that he could separate the sand from the oil using the surfactant,” Mattoon said. “It’s far better than using hot water, and it’s non-toxic as well, satisfactory to the EPA (Environmental Protection Agency) and biodegradable.”

The next step is taking it from the front burner to the oil industry table.

Securing funding for further research and a pilot program that is scheduled for summer 2005 is Enos’ mission.

“If anyone can do this, it’s Michael,” Mattoon said. “He’s the right person to do this – he has great intuition and excellent people skills.”

The kind of stuff that is ripe for the techno-grapevine.