July 2003

 

OMI submits application to present investment opportunity at the November 2003 NREL Industry Growth Forum.

 

The following two page abstract highlights the Ocean Motion International Combined Energy System potential high return on investment and relative low risk.

 

Application to Present at the November 2003 NREL Industry Growth Forum

 

Ocean Motion International,   LLC

 

Ocean Motion International (OMI) is a family owned enterprise registered in the state of Oregon in 1994 as a Limited Liability Company (LLC).  OMI is a clean / renewable energy company that has developed an innovative self-sufficient unit, the Combined Energy System (OMI CES) which uses ocean waves as power to produce high quality / low cost hydrogen, drinking water and electrical power for coastal communities.  The OMI CES is an integrated utility system, which is designed to operate on an offshore platform, beneath an on-shore pier or aboard a sea going barge.

 

The OMI CES employs a revolutionary, patented sleeve-type pump called the OMI WavePump.  This innovative seawater pump was developed in the early 1990s and in 1995 the OMI CES design and proprietary WavePump technology was patented by OMI as a Mass Displacement Wave Energy Conversion System.  The OMI WavePump is essentially the heart of the OMI CES, which enables all three of the products to be produced at (1) low cost, (2) with no emissions or adverse environmental impact and (3) high reliability since ocean waves are ever present.  With the exception of the OMI WavePump, all other CES technologies such as reverse osmosis and electrolysis are already well developed and present no technical risk.  The OMI WavePump is designed, engineered and demonstrated in a 1/20^th working scale-model.  Its simplicity in design and few moving parts results in low maintenance and high durability.  In independent studies of the CES, the OMI WavePump was recognized for its outstanding design in terms of reliability, construction and maintenance.  The outputs from parallel pumps are manifold together to develop hydraulic power with very high pressures and flow rates.  Using conservative operating values for a full size system in an average west coast wave field, the following production results are expected:

Hydrogen - 575 gallons per hour of liquid hydrogen

Water - 90 acre-feet per day

Electricity - 5 MVH with hydrogen production to 50 MVH without hydrogen production

 

Revenue from the OMI CES is expected to be very high.  The OMI CES uses no external resources for fuel or power and production costs are based on capital, operations and maintenance.  Therefore, product costs are low compared to competitor production methods that consume fuel.  Using the above performance and current product pricing, the return on investment and revenue are extraordinary.  Conservative estimates show that product sales will be at least $827,000 per day and operating costs are expected to approximate $60,000 per day.  This will yield a daily profit of a least $767,000.  The OMI Business Plan indicates that a large portion of its profits will be directed back into financing additional OMI CES deployments.

 

Hydrogen, as the fuel of the future, is the most promising product.  The OMI CES produces high purity hydrogen with the lowest cost and the most dependable electrical power possible, its own.  High purity hydrogen production by electrolysis is the preferred fuel source for Proton Exchange Membrane (PEM) fuel cells.  Potential barriers to marketing success include major oil corporations that are currently promoting hydrogen production by a process known as steam reforming.  This high volume process results in harmful air emissions and produces low-purity (sulfur contaminated) hydrogen gas.  Additional purification increases the production costs.  OMI strategy is to promote the OMI CES production of high purity hydrogen at low cost with no emissions or dependency on petroleum.

 

Drinking water is the current ‘high demand’ product in western states.  Desalination for coastal communities is costly because of electrical power requirements.  Government agencies are seeking technologies that reduce costs.  The OMI CES, which is not dependent on external power or fuel, provides a significant cost savings for filtered water.  Potential barriers to marketing success include large energy companies with interests in partnering with desalting facility projects to supply large amounts of electrical power.  Several large west coast cities are already pursing plans that will obligate their customers to pay higher costs for their water from such desalting systems.  OMI strategy is to focus on smaller coastal communities that can benefit from the local production of drinking water at significantly lower costs and at the same time reduce the burden on the intercity water distribution systems.

 

The production of electrical power is a key feature of the OMI CES, which services itself and also provides additional revenue.  There are no potential barriers to marketing success for this product.  The system is based entirely on the renewable energy of ocean waves without any polluting emissions.  OMI strategy is to ensure that owners and financiers understand that electrical power generates additional revenue beyond drinking water and hydrogen.  This fact, being the opposite from other technologies which use electrical power is so incredible that it needs to be pointed out.

 

OMI is currently progressing final performance testing of a 1/10^th scale model OMI WavePump, which will provide operational data that validates projected capacities and operating assumptions.  Prototype design is dependent on the site selected and its ocean wave characteristics.  Financing for the prototype is necessary for OMI to proceed with site selection, final design, permitting, construction and operation.  The cost to complete final performance testing of the OMI WavePump, site selection, permitting, final design / engineering, construction and startup is expected to be approximately $80,000,000.  A fully operational prototype could be demonstrating the OMI CES within one year of securing financial backing.  Capital investment will be recovered with the first four years based on the sales of water alone.  Electricity sales will improve the payback rate and hydrogen is future revenue.  Revenue continues for the system’s expected production life of 20 years with only operation and maintenance costs.

 

As a family owned and operated enterprise, OMI development and evaluations have been limited to personal funds focused on the OMI CES technical aspects.  A core senior management structure has been established to organize roles and responsibilities and is summarized as follows:

Dwight (Hap) Houser (CEO);  has developed innovative technologies and owned and successfully developed a prior startup company ‘ Electronic Force Measuring’

Dwight F. Houser (President):  has been project manager of large, multi-year and multimillion dollar projects for state and federal government agencies.

Matthew J. Houser (Vice-President of Operations);  has several years of experience as the operations director for a major manufacturing facility.

Ruth I. Houser (Secretary, Vice-President of Finance) has many years of experience handling multimillion-dollar properties.

 

OMI is also supported by a small group of enthusiastic facilitators who have actively pursued federal and local government contacts in Colorado California and Hawaii.  These facilitators are strongly committed to seeing the OMI CES deployed and have experience in environmental regulations, policy implementation, marketing, development and implementation of new technologies, quality, safety, startup operations and maintenance.  The management team is very experienced with forming and maintaining strategic partnerships at both the government and commercial business levels.  The OMI Business Plan identifies its objectives for growth and development of its management team.

 

OMI requests that potential investors and government agencies evaluate the merits of the OMI CES and document their evaluation, which include a recommendation to provide assistance funding for final performance testing and prototype deployment.  OMI will use the evaluation results and performance test data to recommend that coastal cities consider the CES in their water, electricity and later hydrogen utility projections.  OMI will oversee the final design, permitting, construction, startup and operations of the prototype unit.  OMI will also use the prototype to validate full production capacity estimates, demonstrate operations and promote subsequent system sales. improve system performance and reliability and redirect a portion of its profits into subsequent production units in the United States and internationally.