Abakan Inc. (OTCQB: ABKI) (“Abakan”), an emerging leader in the advanced coatings and metal formulations markets, today announced the launch of a new minority-owned subsidiary, Terves Inc., to commercialize proprietary reactive materials technology for the shale gas and oil industry. Terves’ TervAlloyTM technology was initially developed by Abakan’s 41% owned subsidiary Powdermet, Inc., for the U.S. Department of Defense to build reactive warheads. TervAlloyTM technology has since been reconfigured and customized into engineered reactive materials that can significantly improve the efficiency and safety of well isolation, perforation and completion for oil and gas companies operating in shale reserves in the United States and across the globe.
“Powdermet is structured as a technology incubator to develop technologies with support from federal agencies, strategic partners and Abakan,” said Andrew Sherman, CEO of Powdermet and Terves. “Once technologies reach a stage of technical development where their value proposition has been validated, we spin off the technology through a subsidiary to commercialize the technology platform. Abakan’s majority owned subsidiary MesoCoat is a prime example of this strategy. We have a very simple criterion for commercializing technologies that we refer to as our two times value proposition, which means the technology offers either twice the performance or life at the same cost, or the same performance or life at half the cost, when compared to competing technologies.”
TervAlloyTM is a class of patented, environmentally responsive, lightweight metallic materials manufactured from magnesium and other light metals such as lithium that are high strength, machinable, and also respond to environmental stimuli such as changes in fluid, pH, temperature or electrical or magnetic fields to induce material changes such as disintegration, gas generation, or heat generation. TervAlloyTM is engineered for various market applications including oil and gas tools for well isolation and completion (frac balls, sleeves, seats), well perforation and fracturing, lightweight electronic packaging, beryllium replacement, airframe structures, rocket motor cases, and transportation The primary application of TervAlloyTM for Oil and Gas include controlled disintegration well completion tooling and reactive tooling that provides for the generation of heat and gas pressure inside a formation.
“Unlike the oil and gas industry as a whole, which is fairly mature in terms of technical advancements, the extraction of shale gas is relatively new and open to large-scale innovation,” said Robert Miller, Abakan’s CEO. “We want to go into this industry early and gain a strong foothold using our engineered material solutions. The frac-ball and energetic material technology platforms that Terves is commercializing could make possible the completion of three to four wells in the same time it now takes to complete one well using legacy technologies. Shale is fast becoming one of the nation’s largest industries; tools used in well completion currently account for over a billion dollar market which is expected to triple over the next three years as shale gas production increases. We expect to be at the forefront of this development.”