Pegaco takes 50% stake in Omnitek

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Peru Pegaco Bus Company of Peru, a Lima-based bus operator, importer of King Long buses and a retailer of compressed natural gas (CNG) fuelled buses, has acquired 50% ownership of Omnitek Peru S.A.C. Omnitek is a joint venture company established by its parent Omnitek Engineering Corporation along with local partners in August 2009 to offer conversion services for diesel engines to operate on natural gas. It also provides repower services for diesel trucks and buses utilising Omnitek’s natural gas engines. In addition, Pegaco has received a new order for conversion kits and related components to meet increased demand in Peru.

Omnitek Engineering Corp. develops and sells new natural gas engines, as well as proprietary diesel-to-natural gas conversion systems – providing global customers with alternative energy and emissions control. The company will retain its current 20% stake in the joint venture conversion operation in Peru and realise 100% of the conversion kit sales to Omnitek Peru.

“Peru, with an excellent natural gas infrastructure and a commitment to reducing carbon emissions, continues to represent an important growth market for our company. Peruvian bank loans are readily available to fleet operators for conversions and diesel engine re-powering is receiving strong interest from fleet operators – especially with a less than a one year return on investment,” said Werner Funk, president and chief executive officer of Omnitek Engineering Corporation.

“The additional liquidity provided by Pegaco’s investment will enable the joint venture to take advantage of an incredibly large market for truck and bus conversions in Peru — a market industry sources estimate will reach at least 20,000 bus conversions and 50,000 truck conversions in the next few years,” said Javier Ojeda, general manager of Omnitek Peru.

In September 2009, Omnitek Peru made history by driving a natural gas powered heavy-duty commercial truck to a record altitude of 4,814 meters (15,800 feet) over the Ticlio Pass high in the Peruvian Andes, the highest road in the world.

Pegaco Bus is said to be one of the fastest growing companies in Peru.