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MagneGas's Hydrogen-Based Fuel Technology Has Multiple Applications: FinancialBuzz Media Interview

|Includes: MagneGas Corporation (MNGA)

MagneGas's (NASDAQ:MNGA) fully patented technology which allows for liquid waste to transform into a hydrogen-based fuel has opportunities abound, according to chief financial officer Luisa Ingargiola, who spoke in an interview with FinancialBuzz News from the floor of the NASDAQ on Wednesday.

The process sterilizes liquid waste by feeding carbon-rich liquid feedstock through a 10,000 degree Fahrenheit electric arc between two carbon electrodes. The liquid waste, which can include anything from manure or sludge to medical waste, produces the hydrogen-based fuel that is an environmentally friendlier natural gas substitute producing lower emissions than any fossil fuel currently on the market.

MagneGas's CEO, Dr. Ruggiero Santilli, is a Harvard and MIT trained scientist, who developed the technology over the course of 30 years of research.

Ingargiola explained Dr. Santilli's vision "that the days of trucking fuel across the country or across the globe are the past," and that the world should be producing fuel where it is needed from a local feedstock.

The Tampa, Florida-based company has diversified this technology into three major lines of business including metalworking and industrial gas sales, equipment sales for liquid waste processing and the use of MagneGas for the co-combustion of hydrocarbon fuels to reduce emissions.

Ingargiola explains how it works by citing the example of a lightening chamber:

"Liquid is fed at a high rate of speed through a chamber at a temperature of 10,000 degrees, which causes a reaction producing the hydrogen fuel that bubbles to the surface."

This is a natural gas alternative "and we sell it in the metalworking market…because it has an extremely hot flame temperature so we compete against acetylene…The metalworking market is actually a US$5 billion industry and we believe that we have the only renewable source for that industry."

The CFO said that the key to the technology is the hot flame temperature that when used to re-combust hydrocarbon fuels withMagneGas's own product, "it reduces emissions by up to forty percent and increases the heat output of that hydrocarbon fuel."

This has attracted business from the coal industry because, as Ingargiola explains, MagneGas's CO2 emission reductions and high efficiency make it a better option than more expensive and less effective carbon capture schemes.

Ingargiola also stressed MagneGas's opportunities in the waste processing industry thanks to a "process that converts waste such as manure, oils or sludge into its hydrogen-based fuel." The company markets the actual equipment for this process.

The CFO explained that MagneGas does not compete against the oil industry and that low crude prices have put pressure on the company's stock from a macroeconomic level.

"But from a business level, it has not impacted us because we're not competing against oil. We're selling gas to the metalworking market and we're competing against acetylene, which is not dependent on oil pricing."

Based on its potential, the future seems bright for MagneGas and Ingargiola said that management feels the stock is undervalued considering "where the company expects to be in 24 months".

Earlier this month, MagneGas signed a one year contract with a major southeast fire-rescue supplier to distribute its special fuel throughout the state of Florida.

MagneGas's special fuel is especially attractive to fire departments as it dissipates into the air quickly in the event of a leak, unlike acetylene, which pools on the ground and creates a major risk for explosion.