U.S.-based Vivakor, a firm that provides soil remediation services for hydrocarbon contaminated soils, recently filed a Registration Statement with the U.S. Securities and Exchange Commission to raise $15 million (USD) for an initial public offering (IPO).  The public money raised will be used by the company to equip itself with the necessary capital equipment to perform its soil remediation services as well as further develop its ‘hydrocarbon upgrading’ capabilities.

The company is currently a private listing company for over-the-counter securities trading as VIVK.  It has a market capitalization of approximately $167 million (USD).

 

Company & Technology

South Salt Lake City, Utah-based Vivakor was founded to develop soil remediation capabilities primarily for the extraction of hydrocarbons from properties that have been contaminated with crude oil or other hydrocarbon-based substances.

The firm is currently focused on clean-up opportunities for hydrocarbon contaminated soil in Kuwait and in naturally occurring oil sands areas in Utah.

Also, more recently, the company inked a deal to purchase wastewater removal equipment, allowing it to provide remediation services to project areas that combine dry and wet areas.

Vivakor also is pursuing the ability to ‘upgrade the hydrocarbons recovered’ from the remediation process, although this technology has not been proven in commercial operations.

Vivakor has received at least $53 million from investors.

Market & Competition

According to a 2016 market research report by Grand View Research, the global pre-oil spill management market was an estimated $100 billion in 2015 and the oil spill management market is expected to reach an estimated $178 billion by 2025.

This represents a forecast CAGR of 3.2% from 2016 to 2025.

The main drivers for this expected growth are an increasing concern regarding the environmental impacts from oil spills in water and soil as well as continued technology development for remediation processes.

Also, North America represented the largest oil spill management market in 2015 and is expected to increase its share due to increased deep sea exploration & production activities.

Major competitive or other industry participants include:

  • National Oilwell Varco (NOV)
  • Fender & Spill Response Services
  • Ecolab (ECL)
  • SkimOil

IPO Details

Vivakor intends to raise $14.7 million in gross proceeds from an IPO of its common stock, although the final figure may differ.  No existing shareholders have indicated an interest to purchase shares of the IPO.

Management says it will use the net proceeds from the IPO as follows:

  • for the purchase of two RPC units, together with related equipment and enhancements;
  • towards the continued development of our hydrocarbon upgrading technologies; and
  • for working capital and other general corporate purposes, including potential repayment of outstanding bridge notes.