ASTFS Contracts ViaLogy to Manage Airborne SAR Flight Program and Data Processing to Locate and Assess Buried Pipelines

Monday, August 18th 2008

ViaLogy LLC announces that it has signed a contract with Advanced Spatial Technologies Field Services, LLC (“ASTFS”) to conduct two airborne synthetic aperture radar (SAR) and Light Detection and Ranging (LIDAR) imaging surveys for buried natural gas pipelines to deliver accurate location and subsurface movement information, and to assess pipeline condition.

Under the terms of the contract ViaLogy will manage SAR and LIDAR survey flights, and perform all quality assurance (QA), sensor data processing and aerial imagery fusion to deliver accurate location and information on the pipeline condition. ASTFS will use ViaLogy results to visualize underground pipeline layout and populate industry-standard geographical information systems (GIS), asset inventory and computer aided design (CAD) systems for the pipeline customer. ASTFS will also be deploying their Spatial Asset Management System (SAMS(TM)) software for cataloging the detected pipeline segments and secondary structures (valves, hand-holes, seals etc) allowing integration with 3-D CAD system for precise GPS asset location, improving subsequent maintenance and periodic inspections.

ViaLogy and ASTFS are jointly piloting a rapidly-deployable end-to-end field service for buried oil and gas pipeline location surveys and degradation assessment. The pilot flights and subsequent service offering meet two high-demand needs in the pipeline industry. First, federal and other regulations stipulate that pipeline maintenance condition meets certain standards and that regular inspections be conducted to insure standards are met. Second, pipeline repair obliges operators to know exact pipeline location in order to find and repair it, and avoid inefficient manual probes. The companies’ new service offering, branded “ASSIST”, will significantly reduce time and costs compared to current survey techniques. This service is being offered to early pilot customers at around $2,500 per km for pipeline geo-location. The ViaLogy-ASTFS contract marks the completion of a key milestone under the Memorandum of Understanding announced by the companies on 1 July, 2008.

Following success of the pilot survey, ASTFS has agreed to deliver minimum revenues of US$26.5 million to ViaLogy for market exclusivity in North America over a period of five years.

Mr. Jim Muller, President of ASTFS stated; “ViaLogy’s prior technical expertise in electromagnetic subsurface imaging and sensor fusion, and especially ground-penetrating SAR, is key to our ability to market and offer a differentiated, well-priced service to our pipeline customers. To date, the pipeline industry has been unsuccessful in exploiting cost-benefits of aerial sensing due to sensor, signal processing and performance limitations.” He added “These pilot surveys will include geolocation and health assessments for over 200km of pipeline segments.”

ASTFS has been leading the down-selection of natural gas pipeline segments for the pilot surveys to include rugged terrain, rapid elevation and ground moisture changes and proximity to urban populated areas in order to demonstrate the unique capability of ViaLogy’s subsurface imaging technology, and to prove it will work under “worst case” conditions where standard SAR has not worked well in the past.

ASTFS and ViaLogy have also entered into discussions regarding an aerial pilot for off-shore buried oil gathering and transportation pipeline location. These oil pipelines are down to 3″ to 6″ in diameter and often cross-over each other. It is estimated that there are 450K miles of natural gas and over million miles of oil transportation lines in North America with 98% being underground. According to US Department of Transportation’s Pipeline Safety Program Office regulations, currently the pipeline companies are required to survey their pipelines on a quarterly to annual basis depending upon proximity to population areas and railroad crossings.

According to ViaLogy President and CEO Robert Dean, “This is an excellent market opportunity for our QSUB(TM) subsurface imaging platform powered by our patented signal processing technology – QRI(TM). The ability to provide guaranteed location information in a cost-effective manner should provide the firms’ near-term access to a large addressable market which has been valued in excess of $2bn. We are very pleased with ASTFS success in acquiring potential customers and strategic partners in the pipeline industry at this early stage.”

ViaLogy also disclosed that recently it had received approval from US Dept. of Commerce to deploy QSUB globally for subsurface pipeline imaging.