Energy is the lifeblood of our modern economy but the way in which it
is delivered to our homes and gas stations isn’t always popular. The mainstream
media in North America has given a voice to the vocal minority who oppose
any type of pipeline expansion yet at same time have also shone a spotlight
on the dangers of transporting oil by rail, as was evident in last year’s
accident at Lac-Megantic, Quebec.
Pipelines, then, would appear to be the better alternative although not
without its own challenges. More than 110,000 barrels were spilled in 544
pipeline incidents in 2013, compared with 45,954 barrels spilled throughout
571 incidents in 2012, according to the U.S. Department of Transportation
(Source: thehydrocarbon.com).
Helping make pipelines safer are companies such as
Synodon Inc. (TSXV: SYD), which employs aerial monitoring (helicopters
equipped with sensors and cameras) to provide crucial pipeline integrity
data. The company’s real Sens technology uses infrared cameras to detect
hydrocarbons and determine whether there is a leak. Gases and vapours have
their own thumbprints from the light the molecules absorb in the atmosphere,
and the realSens instrument detects sunlight reflected from the ground
and captures the data.
Synodon’s highlights for 2013 included new customer contracts with Access
Midstream (Texas), ATMOS Energy (Texas), Apache Canada, as well as re-signing
Enbridge Energy Partners (Texas) to a new contract in addition to a new
three-year contract with expanded services and mileage with Nova Chemicals.
“We are noticing a change from last year in that the market is giving
us a lot more credibility,” says Synodon President & CEO Adrian Banica,
referring to the fact that the company no longer has an uphill battle to
show clients andpotential clients that itcan achieve what it has set out
to accomplish.
“Also for the first time ever, during the last fiscal year, we have received
‘cold calls’ from potential clients wanting to contract our services, which
although hasn’t resulted in huge revenue changes yet it is significant from
a company maturity and service maturity standpoint in the market, which
sets the company up much better for the coming year,” he contends.
In an interview with SmallCapPower.com, Mr. Banica explains that this
greater credibility is translating into discussions with existing clients
to service a “significantly larger” percentage of their networks during
2014. An example of this can be found in the company’s January 16, 2014,
announcement of an expanded follow-order with Access Midstream for Synodon’s realSens
pipeline integrity management services that covers quarterly survey flights
over about 4,000 km of the producer’s Barnett Shale Region network during
the next year. This follows a successful initial contract with Access Midstream
in the last quarter of fiscal 2013.
In addition to the company’s core service of leak detection, 2013 saw
Synodon expanded its offerings to include value-add services that its customers
require but had to purchase from somewhere else. This includes analyzing
Synodon’s visible images for threats to the pipelines, erosion around rivers,
and vegetation on the pipeline, all of which helps with its customer retention
initiatives.
“These value-add services that we are selling will probably have the potential
this year to double our gross profit margins,” Mr. Banica explains.
In a year-end email to his stakeholders, Mr. Banica wrote that “our order
book for next year (2014) is the largest it has ever been in our history
and with what we have on the table it is not inconceivable that we could
double or triple our revenue.” He added, though, that these are projections
which have risk attached.
To learn more about Synodon Inc., you can view their initiation research
report, research bulletins, analyst commentaries and CEO video interview
on their SmallCapPower.com Investor Hub:
HERE
.
About Synodon:
Synodon Inc. (TSXV: SYD)(OTCQX: SYXXF) is a technology company which has
developed an advanced airborne remote gas sensing system called realSens™,
based on technologies developed under the Canadian Space Program and by
Synodon scientists. The company currently provides advanced airborne pipeline
integrity management services to the oil and gas sector through a suite
of services including natural gas and liquid hydrocarbon leak detection,
pipeline threat assessments, and waterway crossings analysis among others.
About Ubika Research
Ubika is an investment research and capital market services firm based
in Toronto and Vancouver with a proven track record of identifying and
launching coverage of high potential small cap stocks at an early stage,
thus offering timely market insights. Its specialty is small-cap companies
with a market capitalization of <$5 billion.
For additional information contact:
Vikas Ranjan, Managing Director
Email:
vikas@ubikacorp.com
Ubika Research has received compensation from Synodon Inc. to provide
analyst research coverage.
