Galatea secures $2.7 million to help oil and gas companies tackle waste disposal

April 30, 2024

Article below from BetaKit, published April 30, 2024

As regulatory pressure mounts south of the border, Calgary-based Galatea Technologies believes the timing is right to export its waste management logistics software to the United States (US).

Galatea has built a solution to help commodity producers track and dispose of wastewater and other hazardous byproducts more safely and efficiently and established a foothold at home, where it claims to serve half of Western Canada’s oil and gas firms.

“This is a great example of where a Canadian company is extremely well-positioned to win in the US market.”Janet Bannister, Staircase Ventures

Now, with a $2.7-million CAD seed extension from Toronto-based Staircase Ventures, Colorado’s Ascent Energy Ventures, and the Ottawa-based Natural Gas Innovation Fund (NGIF), Galatea has set its sights on US expansion.

“Mounting [regulatory] pressures in the US have created a market need for the same solution that we’ve developed in Canada,” Galatea founder and CEO Chad Hayden told BetaKit in an exclusive interview.

Galatea’s all-equity financing, which closed this January, comes as an extension to the startup’s $1.5-million, NGIF-led equity seed round from early 2022. Staircase and Ascent co-led the extension, which was supported by existing backer NGIF. 

This brings Galatea’s total funding to over $7 million, a figure that consists of $4.8 million in equity (including a $600,000 friends and family round from 2019 backed by WVL Capital and Calgary angel investors) and $2.2 million in non-dilutive capital.

Founded in 2019 by Hayden, a petroleum engineering technologist, Galatea aims to improve how Canadian oil and gas companies measure and manage the disposal of the polluted water and other dangerous waste they produce through its software.

Hayden and the Galatea team are familiar with existing processes for doing this and the issues associated with them. “We come from this industry [and] we live that pain,” he added. “This problem used to be our problem … and now we’re here solving it.”

In some regions, including many parts of the US, Hayden said that the disposal of this waste is not tracked at all, while in others, it is documented via pen and paper or simple spreadsheets, making it difficult to draw any insight into how to improve the way that it is handled.

Enter Galatea, which sells software that offers companies visibility into waste generation quantities and rates, disposal optionality, risks, and pricing to help them remain compliant with regulations and make the best possible decision on how to dispose of every single load of waste in light of the associated financial and environmental impacts.

“The disposal of waste materials from oil and gas is a massive market,” Staircase founder and managing partner Janet Bannister told BetaKit in an interview. “They’ve got some great traction and we’re excited about the business they are building.”

Galatea has spent the last five years or so figuring out how to help Canadian firms satisfy strict local regulations and dispose of resource extraction byproducts in a more cost-effective and environmentally friendly fashion.

“Alberta has some of the most stringent environmental, financial, [and] social regulations in all of the world around resource extraction,” said Hayden. “We’re trying to bring that same system and that same rigour of execution into various jurisdictions across the world.”

Hayden noted that in the wake of recent earthquakes, American regulators have been paying closer attention to how local oil and gas companies are handling their waste—at a time when more of the capital flowing into the commodities industry also comes with an eye towards environmental impact.

Some US states, including Texas, Pennsylvania, and Colorado, have tightened or explored altering regulations around the disposal of oil and gas-related waste. Galatea sees room to expand in these regions and help companies both satisfy new requirements and boost efficiency.

Ascent Energy Ventures managing partner David Forsberg believes that the startup is situated well to help US commodity producers and other players across the value chain, including waste disposal sites and transportation experts, navigate shifting regulations. 

“Galatea understands the regulatory burden and how to alleviate that burden better than anyone in the energy space,” Forsberg told BetaKit.

Bannister echoed this assertion. “I think that this is a great example of where a Canadian company is extremely well-positioned to win in the US market,” she said, noting that Galatea has built, tested, and validated its tech in a tough Canadian regulatory environment. 

“This problem used to be our problem … and now we’re here solving it.”Chad Hayden, Galatea

“As US regulations are becoming much stricter—more like the Canadian regulations—Galatea has a solution that has been in [the] market and it’s proven effective, and they’ve been doing this for the last several years,” she added, giving it “a huge leg up” on any new entrants.

Hayden said the hardest part about what Galatea does is often convincing companies in the space to begin digitizing, noting that plenty still lag in terms of tech adoption. With regulatory changes looming, he anticipates that many will soon become more willing to do so.

Right now, Galatea’s customer base is primarily Canadian oil and gas firms, ranging from multinationals to smaller businesses. Forsberg noted that while Canada’s energy waste ecosystem has embraced Galatea to date, the US will likely provide “larger and more diverse opportunities” to expand going forward.

With this funding, plus guidance from Staircase and Ascent, Galatea plans to continue scaling its product and now 15-person team to help commodity producers across the US manage their waste more efficiently and responsibly, starting with Texas.

Feature image courtesy Galatea Technologies.

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