June 25, 2014 / 6:50 AM / in 4 years

UK's Velocys buys U.S. gas-to-liquid developer

LONDON (Reuters) - Gas-to-liquid technology developer Velocys Plc has acquired U.S.-based Pinto Energy for an undisclosed sum, the British company said on Wednesday.

Velocys develops technology to produce cleaner fuels from both conventional and renewable sources such as bio-waste.

Due to a surge in natural gas production in the United States, several firms are turning it into lubricant base oils or transport fuels through a technology known as gas-to-liquid refining.

Pinto Energy is a small-scale gas-to-liquid developer which is developing a plant near the port of Ashtabula in Ohio to convert natural gas from the Marcellus shale region into solvents, lubricants and low-carbon transport fuels.

The facility will initially have a capacity of 2,800 barrels per day (bpd), but that could be expanded to 10,000 bpd, Velocys said.

The acquisition of Pinto Energy is a key stepping stone for commercial growth, Velocys Chief Executive Roy Lipski said in a statement. “Our primary mandate remains technology leadership in smaller scale gas-to-liquids,” he added.

Reporting by Nina Chestney; Editing by David Holmes

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