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GeoBio Energy Closes Acquisition of El Gas North America

Texas Business reports:  Seattle’s GeoBio Energy Inc. bought Houston-based El Gas North America  LLC. 

The transaction closed on November 14, 2011. 

“We are pleased to add El Gas North America and its general manager, Mark Cangany, to our growing company,” said GeoBio chief executive Larry Shelver in a prepared statement.  “Mark brings a wealth of knowledge and years of experience in the gas services sector. His knowledge of the market will be invaluable.”

El Gas North America is the exclusive distributor in North America of the natural gas volume monitoring and correcting equipment and data recorder products of Czech Republic-based, El Gas SRO.

The oil and gas industry historically customarily used pressure monitoring as the primary measure of quantity and for ensuring safety during production, transportation, and storage of the various petroleum products.

Until recently, the rotary 7, 14 or 30 day chart recorder has been the standard of many industries. These recorders use a round paper chart divided into daily segments and use inked pens on swing arms to record pressures and temperatures as lines on the slowly rotating chart. These charts are retrieved by a worker at a certain interval, a new chart installed, and the pens re-inked.  The information is transported back to the office where it is recorded and readied for analysis.

The drawback to these “recorders” is that they have no ability to report in real time.  Many cases of equipment failure over the years have been attributed to the lack of real time ability in these recorders. 

El Gas North America markets a direct replacement, battery operated, solid-state unit for natural gas chart recorders that require no charts or weekly maintenance visits.  The batteries for El Gas North America's units only need to be replaced approximately every six years. 

The unit has the ability to transmit all data acquired via landline, cell and or FM modem, for downloading the data into the customer's computer system at whatever interval the customer requests.

Pressure is mounting from the various environmental and regulatory agencies to incorporate this technology into the oil and gas companies operations and safety plans.  Under the BAT (Best Available Technology) requirements, the major natural gas companies are this solution.

El Gas North America has the advantage of marketing a unit that has been successfully used in Europe for many years.  The US competitors' products in the natural gas data recording market have experienced reliability problems or units that do not zero in on the needs of the petroleum industry.

While the initial marketing will be primarily to large Natural Gas distributors in major metropolitan areas because of the large number of units potentially being purchased, the units have very wide use in the drilling, fracing, and well monitoring arena in North America.  Virtually every gas well in production could use a wireless pressure monitor. 

Sale of the products in the United States and Canada is subject to El Gas North America receiving UL approval and CSA approval, respectively, which applications are underway and which El Gas North America expects to receive by the close of January 2012.  El Gas North America's licensor, El Gas s.r.o., has APEX approval, the European equivalent required certification, on the products in Europe.

“I'm excited to be working with GeoBio and its management, which will provide additional experience and connections to help El Gas North America grow,” Cangany said in a statement.