© 2017 NXT Energy Solutions.The next generation of airborne geophysical survey technology
NXT Energy SolutionsAGM 2017
© 2017 NXT Energy Solutions.
Disclaimer and Forward-looking Statements
The information contained in this document may include forward-looking statements including opinions, assumptions,
estimates and expectations of future prospects for the Company and financial projections. When used in this document,
the words "anticipate," "believe", "estimate," "expect," "intend," "may," "project," "plan," "will," "should" and similar
expressions are intended to be among the statements that identify forward-looking statements.
Forward-looking statements are subject to a wide range of risks and uncertainties, and although the Company believes
that the expectations represented by such forward-looking statements are reasonable; there can be no assurance that
such expectations will be realized. Any number of important factors could cause actual results to differ materially from
those in the forward-looking statements including, but not limited to, volatility of oil and natural gas prices, changes in
the oil and gas industry, the Company’s ability to implement corporate strategies and obtain financing, the state of
capital markets, operating risks, changes in general economic conditions and other factors more fully described from
time to time in the reports and filings made by the Company with securities regulatory authorities.
Neither the TSX or the OTC QB Exchanges accept responsibility for the adequacy or accuracy of any information
contained in this document.
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© 2017 NXT Energy Solutions. 3
Agenda
FINANCIAL REPORT
• Current Capital Structure
• Finance Initiatives
2016 REVIEW
• Current Industry Climate
• NXT Strategy - 2016
• Notable Accomplishments
• SFD® Reliability Rates
2017 OVERVIEW
• Business Development Progress
• Multi-client Project
• Cascade Petroleum
Shareholder Question Time
SFD® RECOMMENDATION CURRENTLY BEING DRILLED
KHARAN-1 PROSPECT IN PAKISTAN – CLIENT: PPL
© 2017 NXT Energy Solutions.
MAY 2017
FINANCIALREPORT
© 2017 NXT Energy Solutions.
Current Capital Structure
TSX : SFD
52 Week High: $1.70
52 Week Low: $1.00
Average Daily Volume: 7,583 Shares
CapitalizationShare Outstanding (in Millions)
Cash and Short-term
Investments as at 31.12.16
Approximate
cash on hand
$1.9 Million
Debt-FreeBalance Sheet
53.9Common
shares issued
3.2Stock options (average
exercise price $1.33)
57.1Fully diluted number
of shares
35% of Fully Diluted Shares Owned
by Directors/ Management
OTC QB: NSFDF
52 Week High: US $1.25
52 Week Low: US $0.74
Average Daily Volume: 7,700 Shares
5
2016
Revenue $1.4 Million
Pre Tax Loss $8.7 Million
Net Loss $9.1 Million
© 2017 NXT Energy Solutions.
Finance Initiatives
NXT AIRCRAFT
In early 2017 a Sale and Leaseback transaction was completed on the aircraft.
Aircraft was sold for US$2.3m and is now leased back for US$39,500 per
month over an initial term of 5 years.
CASH CONSERVATION:
Cash Deferment plan initiated in April 2017. Main areas of focus were:
• Staff wages – between 12% - 15% of salary has been deferred
• All Board and Advisory Board payments have been suspended
• All consultancy payments deferred
• 2 employee positions terminated and vacancies not filled
OTHER FINANCING
Other financing sources are being considered in addition to the Directors loan
from George should it be necessary
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© 2017 NXT Energy Solutions.
MAY 2017
2016 REVIEW
© 2017 NXT Energy Solutions. 8
2016 Industry Challenges GLOBAL DISCOVERY RATES DECLINED
• Oil Price and CAPEX reduced
• Continued downward
pressure on markets
• Shifting to acquisition of
distressed assets
• Record losses reported by
majors
• Major players enter with
minimal commitments
Target Exploration $$
Resource Type Front-End CostAcreage
Availability
Breakeven US$/bbl
Brent Equivalent
Business Case for $40-
$60 Brent Price
Deepwater Gulf of Mexico (US)High High $74 Negative
Unconventionals (US)High Nil $50 Positive
Deepwater (LATAM)Medium Medium
$63 Borderline
Deepwater (Other) Medium Medium $30 - $90 ?Source: Wood Mackenzie / Exxon Mobil
© 2017 NXT Energy Solutions. 9
2016 Industry Opportunities
GLOBAL DISCOVERY VOLUME TREND
• Innovative solutions through
technology
• Emphasis on increasing international
investments
• Greater need to focus exploration
programs
• Solutions to mitigate exploration risk
• Critical need for executive decision
making tools
© 2017 NXT Energy Solutions. 10
• Continued to strengthen sales funnel / opportunity pipeline
• National Oil Companies
• Develop Strategic Alliances with Governments
• Developed Multi-Client and Spec SFD® Survey platforms
• Hired additional industry experienced staff
• Continued the development of our technology
NXT STRATEGY - 2016Adapted to changing market conditions
© 2017 NXT Energy Solutions. 11
STRONGER TECHNICAL VALIDATION
• New technical paper presented with YPFB and
published validating the effectiveness and value
of SFD® technology
• Significant progress was made towards obtaining
official award of International Patents.
SFD® RECOMMENDATIONS SUCCESS
• New SFD® recommendations in the Gulf of Mexico
were drilled successfully increasing the SFD®. In
additions, there is drilling program under way in
Argentina and also in Pakistan.
2016 - Notable Accomplishments
TECHNOLOGICAL ADVANCEMENTS
• Next generation SFD® sensors built and
tested. Initial tests proved to be very
successful: with a significant improvement
in reservoir detection capability.
• Advancement in automated interpretation
algorithm.
STRONGER INDUSTRY EXPERIENCE
• Todd Chuckry, (former CEO of Request and
Spectraseis) joined our team as Director of
Operations. Todd was a key pioneer in
gaining market acceptance of microseismic
technology.
STATEGIC GLOBAL MARKETING INITIATIVE• Sri Lanka Proposed project with an estimated
revenue of $28 million added to funnel.
© 2017 NXT Energy Solutions.
Reliability of SFD® Recommendations
WILDCAT - DST
No. of SFD® recommendations drilled successfully(Commercial discoveries made) 14
19 SFD® Recommendations drilled to date
73% SFD® SUCCESS RATE
Where SFD® and seismic prospects correlated
Average OOIP/drill : >150 MMBBL
Average OGIP/drill : > 100 BCF
WILDCAT – P&A
No. of SFD® recommendations drilled unsuccessfully(NO commercial discoveries made) 5
12
Onshore
18%Offshore
9%INDUSTRY SUCCESS RATES
Based on the applications of all current technologies and
G&G processes
14 seismically qualified prospects surveyed and NOT RECOMMENDED by SFD® drilled
Dry wells
79%Non Commercial Discoveries
Average OOIP/drill : < 5 MMBBL
Average OGIP/drill : < 1 BCF
21%
Unparalleled Risk Mitigating tool for Oil and Gas Explorers and Project Investors alike
© 2017 NXT Energy Solutions. 13
Discoveries in the Gulf of Mexico over SFD®
recommendations
Proof of Concept survey flight lines flown over Mexico for PEMEX in 2012
(3923 Line Kms.)
Please refer to Joint Technical paper with PEMEX exploration directors available on our website.
Kunah Field
1.8 Tcf.
(Discovery in
2012) after the
SFD® Survey
Uchbal 1
102 MMBOE
(June 2016)
New Field Discoveries post SFD® SurveyPEMEX Project 2012
14© 2017 NXT Energy Solutions Inc.
NS
Base Map
Argentina PCR 12 Well Exploration Program with SFD® (in progress)
Seismic Interpreted
Structure Map
Interpreted 3D Seismic Section
MNX-3
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SFD® Survey performed
in 2012
Kharan basin is about is
45,000 Km2) and covered
by superficial deposits of
Kharan Desert
Due to its remoteness and
hard terrain, SFD® data
was used to identify
prospective areas to focus
the US $70 million seismic
program of Pakistan
Petroleum Ltd.
Exploration History - Kharan Basin (in progress)
Pakistan
© 2017 NXT Energy Solutions.
MAY 2017
BUSINESS DEVELOPMENTOVERVIEW 2017
© 2017 NXT Energy Solutions. 17
Business Development Progress
PRIMARY PROJECTS BEING PURSUED IN 2017
Pursuing key target clients and developing new strategic initiatives
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87
5 5 4.6
0.50
5
10
15
20
25
30
SRI LANKA GHANA DOMINICANREPUBLIC
MEXICO CANADA MALAYSIA BOLIVIA
$ M
ILLI
ON
S
© 2017 NXT Energy Solutions. 18
Multi-Client Project (E&P Companies)
• A CNH MEXICO approved project that
qualifies for work-credit and inclusion in
CNH data library.
• Multi-client survey completed over
Mexico Shallow water bid blocks
covering an area of 8909 km2 (15
Blocks).
• In addition to the Multi-Client data,
several of the Companies have
expressed serious interest in independent
pilot projects. High level discussions
underway.
SFD® data provides critical insights enabling participants with strategic decision making capabilities.
New
revenue
stream
initiative
Area 6 - Petronas-Ecopetrol
Area 7 - Eni-Cairn-Citla
Area 8 - Pemex-Ecopetrol
Area 9 - Cairn-Citla, with $30m tiebreak
Area 10 - Eni
Area 1 - No bids
Area 2 - Dea Deutsche-Pemex
Area 3 - No bids
Area 4 - No bids
Area 5 - No bids
Area 11 - Repsol - Sierra Oil & Gas
Area 12 - Lukoil
Area 13 - No bids
Area 14 - Eni-Citla
Area 15 - Shell – Total
MEXICO HIGHLIGHTS
ROUND 2.1 RESULTS
© 2017 NXT Energy Solutions.
Multi-Client Project New target clients :Seismic Service Providers
• Current political climate in the US shifting
• Moratoriums on the East and West coast
to be lifted by new administration
• Large volumes of historic seismic data
needs further validation ( 70’s , 80’s &
90’s) where to start reprocessing
• Ability to assist current seismic data
owners to highlight and license there data
inventory's
• Integration of SFD® & Seismic data key
for seismic data owners to stay
competitive
• Repeat licensed sales opportunity of
SFD® data
• Drives the ability to generate sole source
projects in regions where we have data
and operations
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New
revenue
stream
initiative
US ATLANTIC, GOM & EASTERN SEABOARD
© 2017 NXT Energy Solutions.
Future Benefits of Multi-Client Survey
• Monetize SFD® data library current and future
• Allows for multiple phases to be acquired (years of work to be
done)
• Excellent SFD® validation model to demonstrate critical value
• Currently engaged with Majors and Super Majors to integrate
SFD® data with their current geological & geophysical data
• Ability to assist current seismic data owners to highlight and
license there data inventory's (numerous competing data sets)
• Qualified Technology for work credits
• Continued licensed sales opportunities of SFD® acquired data
• Drives the ability to generate sole source projects in regions
where we have data and operations
A strategic initiative to capitalize on SFD® Data and integration programs
THE POWER OF VALIDATION
New
revenue
stream
initiative
© 2017 NXT Energy Solutions.
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© 2017 NXT Energy Solutions. 21
NXT’s Subsidiary
BUSINESS MODEL FUNDAMENTALS
• Monetize existing and future SFD® proprietary
data establish strategic partnership with E&P
companies.
• In addition to SFD® data with 10+ identified
drillable prospects in Canada, Cascade currently
has an exclusive license to 40,000 km of SFD®
data with 15+ identified drillable prospects in
LATAM.
• Strong experienced technical team
STRONG GROWTH PROSPECTS
• Long term services agreement with NXT to
utilize SFD® to optimize exploration opportunities
• Extensive inventory of market ready prospects
INITIAL TARGET MARKET (CANADA)
• Historically low land & Seismic costs
• Historically low Drilling & Completion costs
CASCADE PETROLEUM INC.
A wholly 100% owned subsidiary of NXT, is an
innovative company empowered by the leading
edge SFD® technology to forge alliance with E&P
companies to find and develop premium
hydrocarbon prospects. Our key advantage lies in its
ability to apply the state of the art proven SFD®
Survey system
A Compelling Opportunity at an Optimal Time
New
revenue
stream
initiative
© 2017 NXT Energy Solutions.
MAY 2017
NXT MANAGEMENT AND ADVISORS
© 2017 NXT Energy Solutions.
NXT Management and Advisors
Management Non-Executive Directors Advisory Board
GEORGE LISZICASZ
Chairman and CEO
BEV STEWART, CPA, FCCA
Chief Financial Officer
CHARLES SELBY
Caledonian Royalty Corp.
TOM VALENTINE
Norton Rose & Fulbright LLP
JOHN TILSON
Business Advisor
BRUCE WILCOX
Manhattan Institute, Board of Trustees
DR. GEORGE IUSCO
Formerly Head of Acquisition and
Exploration, Repsol
HON. GEORGE ALLEN
Former Governor of Commonwealth of Virginia and U.S. Senator
DR. CLEVELAND JONES
State University of Rio De Janeiro
DR. ARIEF BUDIMAN
University of Calgary, Canada
Extensive Industry
ExperienceSolid Global Experience
Outstanding
Scientific Credibility
RASHID TIPPU (MSc Geophysics)
Dir. of Geoscience, Asia, MEA
ENRIQUE HUNG (MSc Geophysics)
Dir. of Geoscience, LATAM
SAJID SAYEED
Dir. Global Business Development
MR. THOMAS BRECKLES
CEO & Managing Director, BCP
Capital AdvisorsTODD CHUCKRY Dir. of Operations
XIANG GUI (PhD Elec. Engineering)
Dir. of Research & Development
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© 2017 NXT Energy Solutions.
The next generation of airborne geophysical survey technology
NXT Energy SolutionsThank You