Energtek to purchase Philippine natural gas

TEL AVIV, July 23 (Reuters) - Energtek Inc (EGTK.OB: Quote, Profile, Research, Stock Buzz) said on Wednesday it has signed a purchase agreement with the Philippine National Oil Co - Exploration Co for natural gas extracted from the San Antonio well in the Filipino province of Isabela.

The contract enables Energtek, a U.S.-Israeli developer of natural gas storage technology, to become a commercial distributor of gas in emerging markets in southeast Asia.

Energtek's storage technology enables it to supply natural gas to small vehicles. The first phase of the project calls for 3,000 three-wheel vehicles to be converted in Isabela and for natural gas to be supplied to them.

The company did not disclose the price paid or the amount purchased but a spokesman said it would be enough to run the 3,000 vehicles for seven years.

Revenues from vehicle equipment sales from this initiative are expected to gross more than $1.2 million and ongoing natural gas sales are projected to exceed $2 million annually.

The Isabela project is the first part of Energtek's plan to convert over 50,000 three-wheelers during the next 18 months, which would generate projected revenues of over $20 million in vehicle equipment sales and $40 million in annual gas sales.

Implementation of this plan is dependent on the attainment of sufficient natural gas supplies, the company said.

Energtek aims to fulfil the government's request to convert over 500,000 three-wheelers within three to four years.

"The Filipino government ... has recognised the need to urgently reduce dependence on oil and gasoline," Executive Secretary of the Philippines Eduardo Ermita said in a statement, noting that small vehicle drivers are suffering from the rising cost of gasoline.