American Power Group sees large quarterly revenue increase

By Patrick C. Miller | April 26, 2017

American Power Group (APG) is seeing a resurgence in its oil and gas conversion revenue as a result of the number of drilling rigs doubling in the U.S. over the previous year and oil and gas field orders from Canada.

Lyle Jensen, APG president and CEO, said the company’s revenue increase occurred during its second fiscal quarter ending March 31. APG expects its quarterly report to show revenue of more than $1.1 million, making it the company’s highest overall revenue quarter in the past two and a half years and its highest oil and gas revenue quarter in the past three and a half years.

“A big contributor to the March quarter revenue was the fact that APG’s new upgraded S4000 Turbocharged Natural Gas System has been selected by an existing prominent and innovative contract drilling customer to become a standard option on their next generation drill rigs,” Jensen said.  

APG’s patented dual fuel conversion technology is a non-invasive software-driven solution that converts existing vehicular and stationary diesel engines to run concurrently on diesel and various forms of natural gas. This includes compressed natural gas, liquefied natural gas, conditioned well-head or ditch gas or bio-methane gas. It offers the flexibility to return to 100 percent diesel fuel operation at any time.

A software upgrade to APG’s S4000 stationary conversion system enables oil and gas producers to optimize performance by making site-specific adjustments to dual-fuel mapping calibrations. The upgrade optimizes performance for four different natural gas compositions, including CNG, LNG, and two BTU levels of field gas up to 1,450 BTU.

The company said its S4000 customers are experiencing up to a 10 percent improved diesel substitution rate. This substantially improves their payback period, which is currently in the 6- to 9-month range—depending on the source gas. The variable fuel management upgrade is in addition to recent display upgrades and new telematics remote monitoring capabilities.

“The future trend of the U.S. driving global energy prices continues to look favorable,” Jensen said. “As OPEC nations continue to throttle back and reduce deliveries to American customers, a further draw down on U.S. crude inventory levels could likely happen particularly now that the refiners are ramping for the summer driving season.”