Good morning, everybody. Thank you very much for turning up to see us so early. My name is Gerry Sheehan. I am the CEO of NXT Energy Solutions. I am going to spend about 10 minutes telling you about our company, our technology, which is particularly applicable to oil and gas exploration, and we will have a look at how we see the company going forward, and we will do a quick run through the basic finances from last year. This is the famous disclaimer page. Read it. They are important for a reason, so that people understand risk and reward. Myself and my colleague, Eugene and Michael are here as well, so we are available all week if anybody else wants to follow up and have a chat with us. What is it we do?
We have developed a system, an airborne system, which can be deployed onshore or offshore, which allows for the identification of trapped fluids in the subsurface. As you can imagine, that is pretty much a highly important contribution to looking for traps for hydrocarbons. Our sensors are developed in-house over a course of many years. We fly them on an aircraft, which flies at about 400 mi an hour, at a height of about 10,000 ft. That gives us a huge advantage over other geophysical methods in the oil sector, in that we can conduct our surveys very rapidly. We have been in commercial existence, I would say, for about 20 years. As the technology has developed more and more, we have achieved a success rate in our prediction strength is about 81% for recommendations as to where people should actually think about drilling for hydrocarbons.
Just a quick run through. We believe now is an interesting time for us. We have a good platform for growth and profitability. 2025 was a turnaround year. Our SFD revenue approached CAD 16.4 million and a cash flow of CAD 1.2 million. Last year, we acquired three international surveys. Our technology is patented in 47 countries, so we are very well protected. Importantly, last year as well, we had a free cash flow of CAD 0.07 per share. Our share price is in and around CAD 0.30, depending on the day of the week. Looking forward, we have two surveys in progress at the moment, one in Africa and one which will probably finish up this week in South Asia. We are also looking at. We hold a proprietary library of our SFD data. We have over 50,000 km alone in the Western Canadian Basin.
We are looking at that with a view to involving ourselves in a concept called the verticals, which I will talk about a little more in a while to give you some more insight on that. In summary, our competitive advantages, we can survey areas very rapidly. We have a high prediction strength, and we have virtually a zero environmental footprint. Let us look at the mechanics a little bit. As I say, our primary application of the SFD technology is in the identification of hydrocarbon-bearing traps. The distribution of stress in the subsurface is very complex but is actually very well studied and quite well understood. The interaction of stress with gravity is fundamentally the basis of our technology in that our sensors can detect changes in the stress field as we fly over.
Think of a hydrocarbon trap as something that it's like a closed system in the underground, so in the subsurface. Something that's contained within the trap has a different set of physics than the outside where there may be no accumulation. That's very simply what we do. There's two types of hydrocarbon traps, mainly. One is the structural trap, where most of the easy oil around the world has been found for the last 100 years. But the other type of trap is a stratigraphic trap, which is much more difficult to identify and to find in the first place, but equally has as much potential as the structural traps have. Thankfully, our system is actually because we're actually measuring a change in stress, our system is agnostic, so we can spot either one with equal ease.
Just a little bit of the mechanics there on the bottom, where, as I said, we fly at about 10,000 ft The sensors on the plane, we carry three completely independent systems, which helps rule out false positives or spurious results from systems. When we actually make a recommendation on a particular anomaly to a client, we have to have seen a response on more than one. Certainly, we normally would expect a good response on five or six of our sensors spread across the systems. We've recently increased our sampling rate to about 8,000 samples per second. This is a view to our ongoing R&D program, where previously we used to acquire at 2,000, now we're acquiring at 8,000. The logic being that there's so much data within that signal that we can start applying AI and other machine interpretation possibilities to actually get more from the signal.
This is my favorite slide. This is an example of one of our signals from the Gulf of Mexico, something we did in 2017. It's part of what we call a spec survey. That is, we went out and acquired the data at our own cost with a view to selling it in the future. The signal you see on the top left there, that's a classic SFD signal. You can see in the middle, there is a very marked change in the amplitude and the frequency of the signal. We picked this up on two intersecting lines, which gave us even more confidence. The extent of the signal was actually very large, well over 7 km in width. About two months later, this structure was independently drilled by Talos in the Gulf of Mexico, and they found the Zama field.
Zama has turned out to be one of the largest fields in the Gulf of Mexico in decades. It's got about 670 million bbl of proven oil reserves. This is basically what we look for, these types of signals. We've calibrated these signals across a variety of geological terrains all over the world. As I say, it's once you're actually in the acquisition phase, the processing and the interpretation of this data is actually relatively straightforward. Where's our market? I'd say two things about this. You're probably all aware that in the last year, global energy security is certainly changing. Middle East, strangely enough, is in turmoil again. The Strait of Hormuz is not going to get any wider. There's been a shift from what were probably considered natural, safe supplies of energy to countries taking a view.
Look, we better start looking at our own potential resources rather than being dependent on other markets. I think the elephant in the room is that as a globe, we consume about 104 MMbpd . So every 10 days, there is another billion barrels of oil gone. We are only replacing about 25% of that. This is a well-known statistic right through the majors, through the national oil companies. So there is a serious problem looming, and the reason we have not had so much reserves replacement in the last decade is because there has been so little money spent on exploration by the big companies and indeed by the local companies. So that is where our market is in terms of our fee-for-service angle of our business.
The advantage of SFD, as I mentioned early on at the start, we have recommended to clients over the last, I think 10 or 12 years. We recommended 37 independent drilling locations across different types of terrain in various different countries. 30 of those proved commercially successful. So, that is an outstanding validation, I think, of our technique. Global exploration of new field wildcats runs on a good day, maybe at 30%. If you are ExxonMobil in Guyana, you are probably getting 43%. If you are down the coast of West Africa, you are probably getting 15% plus. So, our prediction strength actually can make a marked input to decision making on where to drill. Secondly, exploration directors and ministers of energy, they all want to know information quickly. Where can we go? Where can we drill?
The fact that our technology can survey so rapidly, I think, is a major attraction for them. We are seeing that in some repeat business we are getting now from various companies and from governments around the world. We are also able to rule out. If you are a company and you take a very large position, say you went into offshore Namibia or somewhere in West Africa, and you have got a very large basin, we can help screen that basin very quickly. The other thing that SFD does is we integrate completely with all other types of geophysical data and geological data. So we are not standalone. We can work with, or we do work with all other types of data seamlessly. Again, that is very attractive to companies. So recent progress, what changed in 2025?
We now have 100% ownership of our aircraft, which is a Citation jet, which really means we are not dependent on logistical challenges. It is our plane, we can send it where we want to. We also have acquired the rights to the SFD technology 100%. So we have no royalties or no licenses owing to anybody. Again, it is ours. We can deploy it as we wish. The SFD revenues in 2025 were up to CAD 16.4 million, as I said, compared to a much lower CAD 0.64 million in the full year 2024. We have virtually no debt. We have a small amount of debt, which is about CAD 500,000, but we successfully converted 100% debentures that we had on our books last year, were converted by everybody. So our balance sheet is strong.
It's equity driven. I think now we see ourselves as being in a good place for. It's a good commercial turnaround year for us, and we expect more this year, more of the same. Our growth pipeline commercial opportunities. You'll see two large circles there. Africa and Asia have been happy hunting grounds for us. We've got a lot of repeat business there. We're currently finishing up a survey this week in South Asia, which again, is with a customer that we know well. A lot of these, what happens is if our client is impressed by their business, you can expect repeat business again. We have a very strong regional business development program. We use agents in countries that they're connected into the ministries. They know who's doing what in the countries.
Of course, we have our own contacts from particularly my own time spent in Africa and Asia. You'll see there we've marked up the Western Canadian Basin. We actually own a considerable amount of SFD data there, and we have this concept called the verticals, which is we see it as a major growth opportunity for NXT, and I'll talk about that in a little bit more detail. The verticals, what exactly do I mean? As I say, we own considerable amount of data in Western Canada, and indeed, we own another 130,000 km internationally. It's like the Klondike method. The guys who make the money are selling the tents and the shovels. We've got data.
We've started working on the Canadian stuff, and we've identified across Alberta, B.C., and further north, a portfolio of prospects which we believe would be attractive to co-venture with or enter into suitable arrangements with other people. Our idea would be that we would have very minimal capital into that. We're actually putting in the value of our data. In terms of any success, we'd have a significant percentage of the upside. That's the plan there. As I said, you can seamlessly apply that internationally as well. That's that one. This is the key trading and financials. We're listed obviously on the TSX and an over-the-counter in New York. There's less than 120 million shares outstanding. Share price hovers at the moment around CAD 0.30, giving us a market cap of about CAD 36 million. There's a weekly trading range on that, obviously.
Insiders own about 52.5% of the company, and long-term debt has virtually been extinguished. The current financial highlights, net working capital, just over CAD 2 million. Cash and short term, CAD 1.72 million. Revenue on the trailing 12 months, CAD 2.34 million. The next one is free cash flow per share to June the 30th. That's minus CAD 0.01, but that's because we've actually input a lot of money to work in the surveys we're doing now and the follow-ups we'll be doing in 2027. The important number, I think, compared to our share price there is in 2025, we had free cash flow per share of CAD 0.07. You can draw your own conclusions about that. The management team, we're a small company. Technically, we're led by Dr. Xiang Gui, who is widely published in applied physics and material science. He's the co-developer of the technology.
More or less everybody else has an operational or an oil company background. We're fishing in a patch that we know quite well. Eugene, my colleague here, is the President and CFO, and any particular financial questions, we'll direct over to Eugene, and as I say, we're here all week. Mike Baker looks after our investor relations. I come from the far side. I've sort of worked for oil companies all my life, not a service company like NXT is, and I've spent about the guts of 40 years traipsing around Africa, South Asia, Middle East. I try to bring those contacts and experience with what oil companies want to everybody. In summary, we have an interesting technology with a proven success rate. It can be applied across the exploration piece for hydrocarbon exploration. The balance sheet is in good shape.
Good business development and AI is underway, or, sorry, R&D into AI applications is underway. We're pretty much aligned with shareholders in terms of remuneration, et cetera. The verticals concept, I think is something which could be an interesting second arm to our business. So that's it. As I say, we're here all week. If you want to talk to myself or Mike or Eugene, please don't be shy. Thank you very much. Apologies. Are there any questions? Excuse me. Any questions? Yep.
Last year your African survey was pretty big.
Yep.
Your big one here this year. Is this the beginning of a larger exploration program, do you think, or are you kind of winding down?
No, I think it's potentially the beginning of a larger program. We've established a good relationship with particularly the client in Africa, which is a large national oil company. They're very pleased with the results they've had from two previous surveys we did for them, actually. That's a developing relationship. Doing business in Africa, a lot of it is face time and trust, and as you progress into that relationship, we do expect. Similarly in South Asia, again, we're back there now for repeat business, which first started, I think, 10 or 12 years ago. We're quite happy with the way those relationships are building. Yep.
Have you seen an inbound of interest just because of higher energy prices right now towards?
Yes. I sort of alluded to the fact that the world is waking up, that previous suppliers of oil and gas who were deemed to be reliable may no longer be so. That's a change, and people are finally waking up to that, and governments have started to look, "What have we got? What can we explore for?" That's part of our business. But the other thing that's lurking, and I think it's increasingly obvious, is that reserves replacement deficit. You can go and read the statistics in World Oil or the Oil & Gas Journal, and even the big companies like the Chevrons and the ExxonMobil, they are very cognizant of this. So there's a shortage coming, and the only way of finding oil and gas is drilling holes in the ground. We can help with that.
Your Western Canadian data.
Yeah
That you've accumulated, it makes logical sense what you're trying to do there.
Yeah.
Is that something that you would hope to be able to actually
Replicate
yeah, actually activate a relationship there in the next 24 months or do you think in 2 or 3 more years we can still
Well, in Western Canada, we've actually started the process and we've gone through our library of data. We've identified about 15 or 20 prospects, ranked them in the normal way in terms of where they are and environmental stuff and access and all that kind of stuff. So that's underway, and the next step in that will actually be acquiring a land position. That's the way we intend to do it, and there'll be funds set aside or some arrangement set aside for us to do that. We keep our fee-for-service business. That pays the rent. But the verticals is potentially great growth, and that model can be replicated. Say, we could go to Africa or someplace in Asia. You can take a position with a view of attracting in a large oil company or a government player at a later stage. So yeah.
Thank you.
Thanks, Jerome.
Gerry, you earned CAD 0.07 free cash flow last year. You bought back the plane and bought back the patents. You paid down debt. What are you going to do with the cash this year?
A lot of the cash gets recycled into business development, advancing our AI, et cetera. So the cash will be deployed, and we are trying to diversify where we are actually acquiring data or who we are working for, et cetera. So it is being recycled into the business, I think, at the moment. We good? Thank you very much, guys. Thank you.