Pressure Tech Regulatory News (PRES)

Biogas Upgrade Licence Extension

Pressure Technologies plc ("Pressure Technologies") is pleased to announce that its subsidiary, Chesterfield BioGas Limited ("CBG"), has extended its current 5 year exclusive licence to market and manufacture Greenlane® biogas upgrade equipment in the UK and Eire. The new agreement extends the current exclusive licence in perpetuity at a cost of £800,000.

CBG provides turnkey solutions for the cleaning, storage and injection into the gas grid of biomethane, produced from waste water treatment and anaerobic digestion of organic waste. It also sells a range of Compressed Natural Gas ("CNG") filling stations for CNG powered vehicles.

CBG successfully completed the UK's first biogas upgrading project for injection of gas to grid at Thames Water's site in Didcot, Oxfordshire in October 2010. However, the UK market for this proven technology has remained under-developed due to prolonged uncertainty over the level of subsidy Government would provide under the Renewable Heat Initiative ("RHI"). On 10 March 2011, however, the Department of Energy and Climate Change announced that it had set the RHI for biomethane combustion or injection at 6.5 pence per kWh, allowing CBG's technology to compete directly with Combined Heat and Power projects in the UK. 

The Board of Pressure Technologies is pleased to report that, following the announcement of the RHI at 6.5 pence, CBG has experienced an increase in the level of sales enquiries and a number of large utility companies are setting up dedicated Biogas to Grid development teams. The directors believe that customer confidence will be boosted further by today's announcement of CBG's new licence agreement with Greenlane®.

John Hayward, Chief Executive of Pressure Technologies, said: "The securing of a long term exclusive agreement with our partners, Greenlane®, coupled with a realistic level of RHI, gives a strong platform for growth at Chesterfield BioGas. The UK gas to grid market has massive potential and we look forward to reporting significant progress in the coming year."

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Company description:

Pressure Technologies is an AIM listed, leading designer and manufacturer of speciality engineering solutions for high pressure systems serving large global markets.

The Group's largest subsidiary, Chesterfield Special Cylinders Limited ("CSC") designs, manufactures and offers retesting and refurbishment services for a range of speciality high pressure, seamless steel gas cylinders for global energy and defence markets. The business is conducted under the "Chesterfield" brand which is a long established name in the cylinders and specialised pressure vessel market.

Chesterfield BioGas Limited was formed in November 2008 following the signing of a co-operation agreement with Greenlane® Biogas Limited, the world leader in biogas upgrading. This gives Pressure Technologies exclusive rights to market and manufacture Greenlane® equipment in the UK and Eire. Chesterfield BioGas provides turnkey solutions for the cleaning, storage and dispensing of biomethane for injection into the gas grid or use as a vehicle fuel.

In 2010, the Engineered Products Division was formed following the purchase of Al-Met Limited ("Al-Met") and the Hydratron group of companies ("Hydratron").

Al-Met is a niche manufacturer of specialised, precision engineered valve wear parts used in the oil and gas industries, which was acquired by Pressure Technologies in February 2010. Its products are used in high-pressure choke and flow control valves, designed to regulate flow volumes in extremely demanding applications in the subsea and surface oil and gas industries. The business, which was established in 1985, has developed a leading edge capability in precision machining carbides, high grade stainless steels and super alloys.

Hydratron acquired on 15 October 2010, designs, manufactures and sells a range of air operated high pressure hydraulic pumps, gas boosters, power packs, hydraulic control panels and test rigs. Hydratron has sales and manufacturing companies in Altrincham, UK, and Houston, USA and a spread of third party distributors in key locations around the world. Formed in 1981, Hydratron has since established itself as a leading supplier of quality high pressure equipment to the oil and gas industries. The full range of Hydratron products may be viewed at www.hydratron.co.uk.