Press Releases
Clean Power Technologies Inc. Files SEC form 10QSB, Quarterly Report
19 April 2007
Item 2. Management's Discussion and Analysis or Plan of Operation
(a) Plan of Operation
This current report contains forward-looking statements as that term is defined in section 27A of the United States Securities Act of 1933 and section 21E of the United States Securities Exchange Act of 1934. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "intends", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors which may cause our or our industry's actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
We have not generated any revenues from products, services or operations since the inception of our Company. We are a development stage company, which is presently undertaking research and development on a hybrid steam engine.
Our plan of operations is to complete the research and development on our technology over the next several months and if successful, to license the technology or form partnerships for the use of the technology with any customers we may identify.
At present we do not have sufficient funds available to execute our business plan for the development of the technology. We have to date been funded by existing working capital and by shareholder loans from one of our directors and officers. There can be no assurance that we will be able to continue to raise the funding required to continue operations.
Our principal activity to date has been the updating and development of the infrastructure of the industrial building of which the Company took possession in late July. Lighting of the whole working space has been totally reinstalled with dramatically improved consequences for the environment in the administrative offices, test area and workshop. For the latter, delivery has been taken of a range of modern machine tools to service the extensive experimental development programme to which the Company is committed in order to optimize the performance of the hybrid power trains that will be its principal product. Electrical supply and internal wiring have been completely renewed to support these facilities.
Having completed the clearance of ancillary equipment in the Wankel engine compartment of the first Mazda RX8 vehicle, delivery of which was taken in April 2006 at the founding of the Company's U.K. subsidiary, a second identical car was received in September 2006 to allow parallel development of the optimum geometrical arrangement of the components of the auxiliary power units of the Company's
system of Clean Energy Separation And Recovery ("CESAR"). This important work has proceeded but in the background to the infrastructure developments described above.
Experimental research has always been seen as an inevitable and crucial successor to the earlier theoretical studies that have supported the evolution of the CESAR hybrid vehicle system. The experiments will provide the essential empirical data required to enable the precise specification of the sophisticated control requirements of the power plant in steady open road operation as well as the anti-pollution urban mode. They will involve conventional operation of the combustion engine and also in driven mode with compressed air to simulate performance of the vapor in the total hybrid system in advance of delivery of the prototype accumulator vessel which we have been advised will be received from Doosan Babcock by mid April 2007. An air compressor and storage pressure vessel of adequate capacity has been installed for this purpose.
Fluid dynamic and thermodynamic measurements of the charging and discharging rates of the energy accumulator, the performance of the auxiliary engine and of the main combustion engine will be monitored to supply an essential numerical data base. To this end the provision of a test cell to house safely the necessary test programme within the unit has been a major item in the infrastructure programme that has been completed in the period under review. An internal structure strong enough to protect the main unit from a catastrophic component failure has been built and will allow the test programme to proceed immediately.
Supporting theoretical work has continued throughout the period under review, including the detailed design of the energy accumulator. This has indicated that for optimum control and maximum efficiency, an output shaft-driven valve system will be required independent of the engine cylinder porting. Preliminary design of this feature has begun.
A joint meeting of the design team and that from Mitsui-Babcock working on the CESAR project was held at the end of November 2006. Agreement was reached on the immediate practical path ahead with the understanding of the crucial influence that delivery of the first prototype energy accumulator would have, now scheduled for April 2007. It was further agreed that the initial experimental programme should be restricted to a fundamental study of the thermo-fluid dynamics of the system, with the geometrical constraints of immediate application to a vehicle postponed to a second phase. Thus the first pressurisation of the accumulator, after hydraulic and other safety testing would be from a twin lobe Mazda Wankel engine, operating under load control with a toroidal water dynamometer. Testing of this engine to determine operational fluid flows and temperatures will begin in parallel to provide data for the second phase.
Agreement was reached between the parties on the provision of instruments and controls for the prototype system, with Babcock to supply all hardware, including safety valves and sensors for pressure and temperature measurement.
We will supply the steam valves and provide the control and data logging aspects of the system, although with the provision by Babcock of a control algorithm based upon their equipment. We will undertake risk assessments in consultation with external authorities as well as Babcock who commented favourably upon the safety aspects of the new test cell referred to above.
The programme below is shown as a list of research topics associated with a particular component or components of the total CESAR system. Considered estimates are made of the duration of each item although some can overlap. This is particularly the case for the final listed item, development of the control system. Further, the prototype accumulator system will require subsequent design and
development to match vehicle geometry and this part of the total programme will latterly repeat and parallel the items listed.
Resesarch and Development Objectives:
1. Performance tests of our first prototype Wankel engine in normal combustion mode to determine flow rates of fuel and air, thermal efficiency and exhaust temperatures over a range of speed. and power output. These tests are expected to take place during the months of March and April, 2007.
2. Performance tests of our first prototype Wankel engine with one cylinder driven by compressed air to simulate the vapour in the final operation. These test are expected to take place during the months of July and August, 2007.
3. Heat transfer tests upon the evaporator of the prototype accumulator using our first prototype Wankel engine. Times for attainment of a range of specified vapour pressures. The corresponding discharge times for a range of starting pressures and outlet vapour flow rates expanded through the reciprocating steam engine will provide data on the total power output. These test are expected to be ongoing through April to June 2007 in conjunction with the testing detailed above.
4. The tests scheduled as item 3 will be repeated using the exhaust of the second prototype Wankel engine in combustion mode as the source of charging heat for the accumulator over a wide range of practicable operating conditions for both components. These tests are expected to take place during September and October 2007.
Throughout the tests scheduled as items 1, 2, 3 and 4 above, experiments will be required to provide empirical data for the continuing design and optimization of the control of the CESAR system.
These must be regarded as in almost continuous parallel operation with the total research and development programme. We will begin work to use the steam engine to blow hot air into the Wankel engine for analysis and tests as a prelude to doing tests on steam. This work will begin when the steam accumulator is delivered by Doosan Babcock. Once all of the parameters are established for operations, we will begin work to use steam and gas by mid June 2007.
Engine Development
Following is an outline of engine development which will run concurrently with the Reasearch and Development detailed above:
From June 2006 and through the end of February 2007 we have modified the spare engine for air/steam injection points and we have tested with air on the Dynamometer.
During April 2007, we expect to test the engine from first prototype with the first accumulator for engineering development of the second vehicle based accumulator.
During April and May, 2007, we expect to modify the first prototype engine and to test the engine with one lobe running on gasoline re the test accumulator.
During July 2007, we expect to modify the spare engine with a unique timing valve to introduce variable air/steam cut offs.
From July 2007 through September 2007, we expect to modify our first prototype engine for air/steam injection points with variable valve timing for steam cut off.
During September 2007 we expect to test the final rebuild of the first prototype engine with our rig based accumulator micro processor control system.
During October 2007 we expect to rig out best build final with the second vehicle accumulator.
From November 2007 through December 2007, we expect to install the first prototype engine and the accumulator in our first Mazda prototype vehicle.
Timing of Results and Ongoing Operations
In June 2007, we expect to publish our first results from the accumulator.
In August 2007, we expect to split our project into two phases:
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Vehicles
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Auxiliary power units for trucks, ships and the military.
In November 2007, we expect to undertake verification tests with our second scaled down accumulator.
In December 2007, we expect to test drive our first prototype vehicle and we expect to increase the capability and capacity for the auxiliary power unit project.
In July 2008, we expect to test our second prototype vehicle.
In December 2008, we expect to complete the refinement of our second prototype vehicle.
Ongoing from December 2008, we expect to complete our first auxiliary power unit and install it into a truck.
From then forward we expect to start production of auxiliary power units.
(c) Off-balance sheet arrangements
Not Applicable