On bad days, TCEnet Inc. CEO Don Shaw feels like shrieking through a bullhorn: “We . . . are . . . NOT . . . a . . . dot-com!”

Yes, the company develops, sells and supports software solutions, which may spell p-o-i-s-o-n to equity buyers who’ve been buried in the tech slide.

Larry MacDougal
Don Shaw (left) CEO of TCEnet and Michael Comesotti, vice-president of Simulutions, believe market potential for their monitoring software is huge

But Shaw wishes he could grab skeptics by the lapels, and explain the facts.

“We’ve got good top line and bottom line. We’ve got $10 million in backlog (orders). We don’t have to make another sale all year, and we’ll still make money,” said Shaw, setting the record straight.

“However, we WILL make a lot more sales . . . and generate continued growth,” he concluded.

Less than two years after Calgary’s TCEnet Inc. (TCE-CDNX) emerged from a confusing merger of companies and their subsidiaries, the reborn corporate entity is showing signs of renewed vigour.

They include a 29-per-cent leap in revenue over the first two quarters of 2001. Forgive shareholders if they refrain from bursting into song.

Midway through last week, the price of one TCEnet share would’ve bought you about 10 minutes on a downtown parking meter.

Why? Well, for one thing, that encouraging revenue was offset by a net loss of $321,957 in the second quarter.

For another, Shaw and his associates feel they’ve been unfairly lumped in with those black-sheep techs.

The brass points out that, unlike many an imploded tech outfit, TCEnet brings in revenue.

It has products, and it sells them to clients, many of which are estimable players in the global oilpatch. They include Petrobras, Chevron, and Shell Australia, among others.

At the moment, Shaw is particularly turned on by fresh developments at Simulutions, one of TCEnet’s three operating divisions.

In remarks to the shareholders, TCEnet attributed those second-quarter losses to delays in nailing down key projects, two of which have since become done deals.

One is a contra arrangement with a German concern called Liwacom Infromationstechnik.

Under terms of this deal, Liwacom will market Simulutions’ liquid pipeline management software in both Europe and Russia.

Simulutions returns the favour by selling Liwacom’s software, which Shaw believes borders on the revolutionary.

It enables natural gas producers to monitor and micro-manage pipeline gas flow, a much trickier proposition than managing transmission of other fluids.

Mention pipelines, and most people conjure visions of the Arctic or the Scotia Shelf, with multi-nationals moving gargantuan volumes to urban markets.

But North America is criss-crossed by as many pipelines as phone lines, and they carry everything from aviation fuel to butane.

TCEnet customers such as Buckeye Partners L.P. run a dizzying mix of liquid products through almost 6,500 kilometres of pipeline, all over the eastern U.S.

“The scheduling process is very complex,” Shaw explained. “They used to do it on (paper) spreadsheets, by hand.”

Complex indeed.

Imagine managing the simultaneous movements of a few thousand freight trains, while avoiding derailments and making every scheduled stop.

Simulutions turns the trick by means of PipeScheduler, a scheduling application from the division’s pipeline ‘toolset.’

Buckeye and other major clients have also purchased applications which track product batches, while simultaneously measuring temperatures and volumes.

At the moment, though, Shaw and Simulations VP Michael Comesotti are revved up over a deal closed last summer with Petrobras, Brazil’s state-owned oil giant and one of the world’s production kings.

Roundly hooted by the rest of the planet because of a litany of disastrous spills (including 2001’s offshore rig disaster, and 50,000 litres of crude dumped near a Brazilian beach resort a year ago), Petrobras has apparently decided to straighten up, and fly right.

Killer insurance premiums will do that to you.

One step included the purchase of leak-detection software (brand: LeakWarn) from Simulutions.

Until the Brazilians wearied of the environmental arch-villain label, there was little provision for leak detection along untold thousands of kilometres of Petrobras pipeline.

Naturally enough, the aging infrastructure contributed to serious leakage problems, leading Petrobras to go shopping for improvements.

They settled on LeakWarn.

With cash now flowing north from Brazil, Shaw and Comesotti believe they can safely predict a profitable third quarter.

They feel better still when they consider the untapped market potential.

“There are still thousands of kilometres of pipeline out there which now require our technology, whether for environmental reasons (LeakWarn), or because they have added multiple clients who now use their pipelines (PipeScheduler),” said Comesotti.

And, should TCEnet/Simulutions land more customers like Petrobras, Shaw will mothball his bullhorn for good.