Rentech and Dresser Engineering in alliance

Aug 26, 1999 02:00 AM

In a joint release, Rentech, Inc. and Dresser Engineering Company announced an agreement in principle whereby Dresser Engineering will have the exclusive right to provide process engineering, detail engineering and design of the Rentech Synthesis Reactor Module for its integration into natural GTL plants utilising Rentech's GTL technology.
Such rights exclude those previously granted by Rentech to Texaco Natural Gas, Inc. by License Agreement dated October 8, 1998, and certain rights previously granted in the country of India. The two firms also announced that Dresser Engineering's parent company DECI, and Rentech will exchange minority stock ownership in a tax-free exchange of shares.
The agreement calls for DECI to own seven and a half % of the common stock of Rentech and Rentech to own 5 % of the common stock of privately-held DECI.
The Rentech/Dresser Engineering announcement added that the firms are negotiating for the issuance to Dresser Engineering of a non-exclusive, world-wide Master License Agreement for Rentech's GTL technology when 100 % natural gas is the syngas feed.

Specific licenses to use the Rentech GTL technology will be issued to Dresser Engineering on a site-specific basis including one for an unidentified client of Dresser Engineering.
The companies will take advantage of each other's strengths to further develop and jointly market Rentech's GTL technology on a world-wide basis. The companies intend to pursue small to medium-sized projects -- 500 to 20,000 bpd of GTL products. While nothing precludes the companies from pursuing larger projects, both companies believe that such sizes are both economic and represent a substantial portion of the near term GTL market.
William Morris, chairman and CEO of Dresser Engineering, stated, "Dresser Engineering has been studying the rapidly emerging GTL field directly and on behalf of certain clients for at least the last three years." Morris added, "Dresser Engineering is impressed with Rentech's technologyand patent estate, 18 years of Fischer-Tropsch experience and pilot plant results, and its undervalued share price." He concluded, "The alliance with Rentech will enable both companies to better compete in this arena of growing strategic interest to every major oil and gas company."

Dennis L. Yakobson, president and CEO of Rentech stated, "The Dresser Engineering/Rentech relationship provides a natural next step in the commercial deployment of the technology. We are excited to have a company such as Dresser Engineering with its extensive natural gas processing experience and clientele as we move forward in commercialisation of our GTL technology.
Dresser Engineering's reputation and experience as an engineering, procurement and construction firm will provide our customers with the type of service, experience and confidence necessary to help bring our GTL technology to its fullest potential."

Dresser Engineering provides engineering, procurement and construction services to the energy industry world-wide. In business since 1926, its areas of particular expertise include natural gas gathering and processing, NGL recovery, fractionation, compression and refinery and process plant upgrades and revamps.
Dresser Engineering, based in Tulsa, Oklahoma, has recently opened an office in Houston and has been staffing it with experts in GTL and downstream processing know how.

Rentech is the developer, marketer and licensor of a patented and proprietary process for the conversion of gases, as well as solid and liquid carbon bearing materials, into super-clean, high value fuels, products and chemicals. These products include cleaner burning, sulphur-free, aromatic-free diesel fuel, naphtha and waxes.

Source: Rentech, Inc.
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