HOUSTON, Feb. 24, 2011 /PRNewswire/ -- Dresser-Rand Group Inc. ("Dresser-Rand") (NYSE: DRC) announced today that Dresser-Rand Company has entered into a definitive agreement with Echogen Power Systems of Akron, Ohio under which Dresser-Rand will acquire a minority interest in Echogen as well as certain license and exclusive market rights to Echogen's technologies and intellectual property. Dresser-Rand's investment will be used to advance Echogen's technology development, including the design and construction of waste heat recovery systems utilizing turbo-expanders provided by Dresser-Rand.
Echogen is a technology development company focused on developing innovative heat-to-electricity power generation systems that use supercritical working fluids to transform heat into power without creating new emissions. This technology drives value for the client through its unique combination of a lower cost per unit of electricity produced, compact footprint, higher energy recovery from the waste heat stream, and ability to generate power from a wider range of heat sources than competing technologies available in the marketplace today.
"We believe this innovative process technology will expand Dresser-Rand's product portfolio, further strengthening our ability to compete in the largely un-tapped waste heat recovery market for power generation. Estimates reflect that there are over 400 gigawatts of waste heat streams that are not currently being recovered. We plan to target projects in the 1 to 50 megawatt size range. Our high speed, high pressure power recovery expanders will benefit from the application of this technology," said Bradford W. Dickson, Dresser-Rand's VP and Chief Marketing Officer. "Our investment in Echogen is a continuation of our strategy of applying our value-added products across all energy infrastructure markets and growing our position amongst the technology leaders in our industry. Together with our recently launched Integrated Compression System, which is the only compression technology with an integrated separator, and our development of a supersonic compression platform, we continue to demonstrate our commitment to this goal."
Phil Brennan, CEO of Echogen, said, "Echogen's breakthrough power generation cycle is ideally suited to the waste heat recovery and power generation applications in both Oil and Gas and Industrial markets. The unique properties of this skid-based system, known as the Thermafficient® Waste Heat Engine, separates Echogen's technology from competitors in cost, footprint and performance. Dresser-Rand is recognized globally as a technology leader with a strong position in serving the worldwide energy markets. They are the ideal commercialization partner for Echogen, bringing scale and credibility while accelerating our market entry plans. We look forward to partnering with Dresser-Rand to deliver high value, turn-key solutions for the largest consumers of power globally."
"Echogen's technology may be applied in many of our Oil & Gas markets to reduce the adverse environmental impacts in refining and petrochemical facilities. In addition, this technology will provide enhanced power generation in Combined Heat & Power applications and Compressed Air Energy Storage systems," said Marco Rossi, Dresser-Rand's Vice President for New-Equipment, Environmental Solutions. "The Echogen technology provides higher net energy recovery than other systems that utilize a wide temperature range of heat sources. Initial field demonstrations already indicate better than 30% recovery is achievable, which will provide clients with a higher return on investment and reduced power generation demand. In addition, this solution offers further reduction of their carbon footprint."
Under the definitive agreement, Dresser-Rand will make an initial investment of $10 million in exchange for a 20% ownership interest in Echogen. Dresser-Rand will also acquire certain broad license rights in key industrial verticals and will pay Echogen a royalty based upon future equipment sales in these markets. Commercialization is expected to begin in 2012.
Echogen Power Systems, a private company headquartered in Akron, Ohio, is commercializing the harnessing of waste heat for power and cooling applications. Echogen has developed a breakthrough power generation cycle called the Thermafficient® Waste Heat Recovery Engine. It uses a modified Rankine Cycle with supercritical carbon dioxide (ScCO2) as the working fluid. ScCO2 is environmentally benign, non-toxic, and has favorable heat and mass transport properties which allow for an energy dense, compact thermodynamic system. Echogen's target customer groups include power generation and large energy consumers in the industrial sectors of oil & gas production and transmission, petroleum refining, chemical processing, iron, steel, glass, or any other sectors typically operating with large sources of energy loss from hot exhaust gases and residual heat in liquid product streams.
Dresser-Rand is among the largest suppliers of rotating equipment solutions to the worldwide oil, gas, petrochemical, and process industries. Dresser-Rand operates manufacturing facilities in the United States, France, United Kingdom, Germany, Norway, India, and China, and maintains a network of 39 service and support centers covering more than 140 countries.
This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements with respect to planned or proposed repurchase of shares of common stock. Forward-looking statements include, without limitation, Dresser-Rand's plans, objectives, goals, strategies, future events, future revenue, or performance, capital expenditures, financing needs, plans, or intentions relating to acquisitions, business trends, executive compensation, and other information that is not historical information. The words "anticipates", "believes", "expects," "intends", and similar expressions identify such forward-looking statements. Although Dresser-Rand believes that such statements are based on reasonable assumptions, these forward-looking statements are subject to numerous factors, risks, and uncertainties that could cause actual outcomes and results to be materially different from those projected. These factors, risks and uncertainties include, among others, the following: potential for material weaknesses in its internal controls; economic or industry downturns; its inability to implement its business strategy to increase aftermarket parts and services revenue; competition in its markets; failure to complete or achieve the expected benefits from any future acquisitions; economic, political, currency and other risks associated with international sales and operations; fluctuations in currencies and volatility in exchange rates; loss of senior management; environmental compliance costs and liabilities; failure to maintain safety performance acceptable to its clients; failure to negotiate new collective bargaining agreements; unexpected product claims and regulations; infringement on its intellectual property or infringement on others' intellectual property; difficulty in implementing an information management system; and Dresser-Rand's brand name may be confused with others. These and other risks are discussed in detail in Dresser-Rand's filings with the Securities and Exchange Commission at www.sec.gov. Actual results, performance, or achievements could differ materially from those expressed in, or implied by, the forward-looking statements. Dresser-Rand can give no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them does, what impact they will have on results of operations and financial condition. Dresser-Rand undertakes no obligation to update or revise forward-looking statements, which may be made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. For information about Dresser-Rand, go to its website at www.dresser-rand.com.
SOURCE Dresser-Rand Group Inc.