Vivakor (NASDAQ:VIVK) Inc told investors it has signed a lease with Tar Sands Holdings II (TSHII) and an agreement with Greenfield Energy, which, together, are expected to provide it with multiple years of rich oil sands supply, along with access to world-class operational services.
The South Salt Lake City, Utah-based company said the multi-year lease allows it up to 2,000 tons per day of oil sand material, which is guaranteed by TSHII to be at a minimum of 10% hydrocarbon by weight, that is expected to produce up to 200 tons of asphalt cement per day when processed through four of Vivakor (NASDAQ:VIVK)’s patented Remediation Processing Centers (RPCs).
“Locking in a reliable supply of rich, raw oil sands was an important step in preparation to execute long-term sales contracts and prepare for the continual production and sale of asphalt at our Vernal, Utah facility,” CEO Matt Nicosia said in a statement .
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Vivakor (NASDAQ:VIVK) said its existing RPC, which is in the process of being scaled up to full capacity of 50 tons of asphalt cement per day, has demonstrated the ability to produce asphalt cement that independent testing has determined meets roadway performance grade specifications .
In light of increasing oil prices and asphalt cement scarcity, the company noted that wholesale prices now exceed $450 per ton, having increased by approximately 30% since December 2021. Resource estimate reports for the mine indicate more than 40 million barrels (approximately 7.7 million tons ) of recoverable heavy crude.
The company said its arrangement with Greenfield includes a professional services agreement (PSA), which provides for Valkor, an energy services company with extensive operations, fabrication and installation experience, to perform certain operating and engineering services to increase the production capabilities of the Vivakor plant to enable it to produce upwards of 1,000 barrels per day or 1,000 tons of asphalt cement per week once three more RPCs are financed and built.
Vivakor and Greenfield will also be exploring the treatment and commercialization of the post-processed, cleaned sand material that is residual after the extraction of the bituminous material in the creation of asphalt cement. Vivakor said early indications show promising signs of the economic value of this sand for various applications.
“Through this lease with the property owner, and in working with Greenfield as the mine operator, we have secured the necessary materials and expertise to scale production to expected levels of around 1,000 barrels per day of oil or 200 tons of our performance grade asphalt product ,” Nicosia continued. “We expect that, by the end of the year, we will have financed, built and ramped up our infrastructure to process this full amount of material available.”
Greenfield Energy president John Potter added: “Vivakor’s patented recovery and cleaning process allows them to recover and clean this naturally contaminated soil, leaving behind a cleaner environment. It not only provides a revenue opportunity for Greenfield in the sale of the oil sands but also allows us to work on upscaling their facility that can provide future commercial opportunities through a world-class operational team such as Valkor. It’s a win-win.”
Vivakor currently focuses on bitumen (heavy crude) extraction from shallow, oil-laden areas in eastern Utah, along with petroleum based remediation projects across the globe. The technologies utilized are low-cost, proprietary, and disruptive for the industry.
The company’s business model relies on Vivakor being an acquisition hub, focused on building and acquiring cash-flowing assets in discrete areas where it has a technological advantage. It mainly acquires, develops and commercializes clean technology solutions.
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