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ACCESSWIRE 25-May-2023 12:01 PM
Led by Significant Increase in Oil and Natural Gas Liquid Sales from Acquisition of Silver Fuels Delhi, LLC
LEHI, UT / ACCESSWIRE / May 25, 2023 / Vivakor, Inc. (NASDAQ:VIVK) ("Vivakor" or the "Company"), a socially responsible operator, acquirer and developer of clean energy technologies and environmental solutions, today announced financial and operational results for the fourth quarter and year ended December 31, 2022.
Key Financial Highlights for Year Ended December 31, 2022:
Vivakor Chairman and Chief Executive Officer James Ballengee commented, "While we are pleased with our quarterly and annual operating results since the closing of our transformational acquisition in August 2022, this past year was very much a set-up year for 2023 and beyond. At year end, we ultimately determined to recognize substantial expenses, write-downs and impairments, so we could start off 2023 with a new and clean slate. Thus, our operating loss ballooned to $22.7 million, and is not reflective of our ongoing business as it included $19.4 million of non-cash or one-time expenses. In addition, we also incurred significant costs associated with our uplist to Nasdaq and with attorneys, auditors and due diligence on our acquisitions. As this Form 10-K was our initial Annual Report with the combined assets and operating businesses, it took extra time to complete."
Ballengee concluded, "Despite the delay in filing our 10-K, our team has been extremely busy making our business combination more efficient through synergies and the streamlining of expenses. In fact, our acquired businesses outperformed our initial expectations for revenue and EBITDA. And now that our 10-K has been filed, we expect to execute on our capital markets strategy, continuing our efforts to increase our visibility and shareholder value. We look forward to sharing our progress with existing and prospective new shareholders over the coming months."
Vivakor is extremely excited to welcome its new Board of Directors, who bring a wealth of expertise and knowledge both in the oil & gas industries and the financial public markets. Independent directors John R. Harris, Albert Johnson and David Natan, together with the Company's CFO, Tyler Nelson, along with James Ballengee, now comprise Vivakor's Board, strengthening its corporate governance. The new directors provide a diverse range of experience applicable to oil and gas, operations, technology, public companies and capital markets. The Company is confident that this newly constructed Board will help it successfully navigate the capital markets.
Silver Fuels Delhi ("SFD")
SFD operates a crude oil gathering, storage, and transportation facility located on approximately 9.3 acres near Delhi, Louisiana. Under existing agreements, a subsidiary of a large NYSE traded energy company is obligated to purchase from SFD all crude oil offered by SFD to such purchaser, in amounts up to 60,000 barrels per month, or more, subject to prior approval. Additionally, SFD is guaranteed a minimum gross margin of $5.00 per barrel on all quantities of crude oil sold thereunder into 2032 under existing crude oil supply agreements with WC Crude. At present, SFD is gathering and selling approximately 1,400 to 1,700 barrels of crude oil on a daily basis.
White Claw Colorado City ("WCCC")
WCCC operates a 120,000-barrel crude oil storage tank, in the heart of the Permian Basin, located near Colorado City, Texas. The storage tank is presently connected to the Lotus pipeline system and the Company intends to further connect the tank to an additional major pipeline system. Under the terms of an existing agreement, WC Crude has agreed to lease the oil storage tank for a period of 10 years. As with SFD, WCCC provides the Company with the infrastructure to process and sell oil which has been recovered via an RPC machine from tank bottom sludge and contaminated soil that exists in the Permian Basin.
Land Lease Agreement in Houston, Texas
On December 16, 2022, the Company's subsidiary, Vivaventures Remediation Corp. entered into a Land Lease Agreement with W&P Development Corporation, under which the Company agreed to lease approximately 3.5 acres of land in Houston, Texas (commonly known as the San Jacinto River & Rail Park, 18511 Beaumont Highway, Houston, Texas). We plan to operate one of our RPC machines on the property, as well as to store certain equipment onsite.
Competitive Strengths and Growth Strategy
Vivakor's two primary growth strategies for its crude oil gathering, storage and transportation services are to attempt to acquire additional barrels of oil for its services and to seek to acquire businesses that have operations that are synergistic with its current operations.
Regarding remediation services, the Company is focused on the remediation of contaminated soil and water resulting from either man-made spills or naturally occurring deposits of oil. Historically, the Company's primary focus has been the remediation of oil spills resulting from the Iraqi invasion of Kuwait and naturally occurring oil sands deposits in the Uinta basin located in Eastern Utah. However, Vivakor plans to expand into other markets where it believes its technology and services will provide a distinct competitive advantage over the competition.
To that end, in April 2022, Vivakor engaged an industrial solutions service company as an independent contractor to assist in placing an RPC in the Houston, Texas market for the purpose of processing hydrocarbon tank bottoms.
In the future, the Company intends to explore placing additional RPCs in the Gulf Coast Region, including Texas, Louisiana, Arkansas, as well as in Oklahoma. In order to place RPCs at these locations the Company will need to secure the necessary financing and manufacture additional RPCs, as well as contract with the site locations in order to install the RPCs.
In addition to the Company's growth strategies set forth above, the Company is also focused on growth through the acquisition of synergistic businesses and is regularly reviewing potential acquisition targets.
Financial Results for Year Ended December 31, 2022
About Vivakor, Inc.
Vivakor, Inc. (NASDAQ:VIVK), is a clean energy technology company focused on the oil remediation and natural resources sectors. Vivakor's corporate mission is to create, acquire and accumulate distinct assets, intellectual properties, and exceptional technologies. Its Silver Fuels Delhi, LLC, and White Claw Colorado City, LLC subsidiaries include crude oil gathering, storage, and transportation facilities, which feature long-term ten year take or pay contracts.
The Company's patented Remediation Processing Centers allows for the environmentally friendly recovery of bitumen (heavy crude) and other hydrocarbons from the remediation of contaminated soils. It is believed to be the only remediation system that can clean soils with more than 5% by weight oil contamination while fully recovering the oil and leaving the soil fully viable for reuse. Its Remediation Processing Centers currently focus on extraction from shallow, oil-laden sands, along with generating petroleum-based remediation projects in Kuwait and in Houston, Texas.
For more information, please visit our website: http://vivakor.com
This news release may contain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based upon our current expectations and speak only as of the date hereof. Our actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including economic slowdown affecting companies, our ability to successfully develop products, rapid change in our markets, changes in demand for our future products, legislative, regulatory and competitive developments and general economic conditions. These risks and uncertainties include, but are not limited to, risks and uncertainties discussed in Vivakor's filings with the Securities and Exchange Commission, which factors may be incorporated herein by reference. Forward-looking statements may be identified but not limited by the use of the words "anticipates," "expects," "intends," "plans," "should," "could," "would," "may," "will," "believes," "estimates," "potential," or "continue" and variations or similar expressions. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.