Kelso Technologies Approves Field Service Trials for New Top Ball Valve

Kelso Technologies Inc. reports that the Association of American Railroads (AAR) has approved Kelso’s new top ball valve (KTBV) for commercial field service trial testing.

The KTBV joins our low-profile bottom outlet valve and standard-profile bottom outlet valve (KBOV) in field service trial testing as a prerequisite for final AAR approvals. This represents another successful milepost in the Company’s revised product development initiatives for rail tank car equipment.

The underlying design research for our KTBV has been through the direct cooperation and co-engineering advice from several motivated customers. The design objectives are to significantly diminish the expensive chronic performance and supply problems that are persistent with the current top ball valves widely used today.

The KTBV is utilized on general service rail tank cars for the primary purpose of loading and unloading the contents of the tank. It is positioned on top of general service tank cars with a standard configuration consisting of either two or three top ball valves per tank car. They are widely used in the transport of hazardous commodities such as crude oil, ethanol, chemicals, petrochemicals and minerals. The new AAR field service trial will involve at least two customers with service in a variety of commodities.

The key proprietary design elements for the KTBV include the use of a more reliable, longer wearing, scratch-resistant and non-corrosive ceramic ball. It has a seat protecting ceramic wiper which allows for seats to remain clear of any debris and impurities collecting in the commodity therefore extending the service life of the valve seats and the prevention of valve seat leaks. Our KTBV is a full port design to maximize flow rates for efficient, unimpeded loading/unloading of commodities; it provides easy and quick disassembly for cleaning, inspection and servicing; and it is fully compatible with flanged or threaded loading/unloading adapters.

As with all Kelso rail tank car products our KTBV equipment is completely manufactured in the USA and fully machined from virgin material which is a significant improvement over the imported cast components used by competitors. The Company’s well established supply chain management system allows Kelso to provide customers with the shortest most reliable lead times in the industry – a key benefit to customers with dynamic production systems.

Our KTBV development associates have agreed to meet all the requirements of the AAR field service trial testing. Their participation will assist in the completion of regulatory processes necessary to gain full AAR approvals. An AAR approved KTBV is expected to improve the potential of market adoption by numerous customers.

James R. Bond, CEO and President of the Company states that: “The Company continues to evolve the rail business model around customer needs as Kelso invests in co-engineered rail tank car equipment development. This approach along with an improved collaborative relationship with the AAR including our long standing M1003 manufacturing status improves the potential for additional revenue sources from sales of our newly developed products. Given stringent rail regulations and testing guidelines our R&D projects like the KTBV and KBOV including final AAR approvals will remain complex, time consuming and very expensive. The generation of new revenue streams from any of our new products remains unpredictable with no guarantee that commercial revenues will occur. During the KTBV field service trial we anticipate that the Company will be allowed to legally sell an AAR specified number of KTBV units commercially to support customers’ needs generating some early cash flows for Kelso. If and when fully adopted by the rail industry our KTBV along with our new standard profile KBOV are expected to significantly improve Kelso’s consolidated financial performance from rail related products.”