Flogas Group signs letter of intent with Alkcon

Alkcon Corp., a developer of natural gas processing equipment, has entered into an exclusivity agreement and a letter of intent with Flogas Group of Leicestershire, England.

The agreement grants Flogas the exclusive right to market and sell the company's proprietary methane-to-propane gas conversion technology in the UK, Ireland, France, Norway, Sweden, Netherlands and Belgium.

Under the terms of the agreement, Flogas will purchase a minimum number of the company's MP32K gas conversion systems annually for five years. The agreement should result in nearly $60 million (€54 million) in revenues for the company.

Flogas intends to install the MP32K units at biogas production sites throughout Europe. Each MP32K system could produce up to 1,600 tonnes of propane annually. The resultant biopropane will be used to enrich biomethane, increasing its caloric value, before it is injected into the national gas grid.

Alkcon's CEO Lauren Scott says: 'This agreement is an important first step to making biopropane available throughout Europe. Biopropane is a clean-burning, renewable fuel which can replace autogas and liquefied petroleum gas in all consumer and industrial applications.'

Dr Kent Hoekman, a research professor at the Desert Research Institute and part of the company's technical advisory team notes that 'converting methane to propane could add substantial value to low-grade feedstocks, while significantly reducing greenhouse gas emissions'.

Deliveries of the MP32K gas processors are expected to begin in 2016.