Market Intelligence

Superior emission characteristics

There is a great need for this new generation liquid injection system with its superior emission characteristics. LI is vastly superior to LPG vapour systems (a 1918 invention) and superior to LPG gas injection systems which cost the same or more.

LPG has long been the fuel used for forklifts (globally a large market), in ships holds or warehouses, for health reasons.

Almost all of Europe, China, India, Egypt and the USA are now favouring LPG for health reasons. This is generally expressed in lower taxes for vehicles using LPG. (See "Financial and regulatory support" forthcoming for details.)

Motor vehicles in general are under attack for pollution, the pronounced emphasis is on cleaner engines. Fuelling with LPG is one way in which lower emissions are achieved and saves the motorist dollars in using LPG.

There are also real concerns as to the impact of diesel vehicles on air quality. Importantly, emissions of NOx and particulates that directly affect our health. (The potentional of liquid injected LPG as diesel supplement is discussed in more detail below.)

Price advantage of LPG

Due to well recognised environmental benefits (see above) governments provide strong financial incentives to encourage the use of LPG rather than petrol.

In Australia, the RACV provides an analysis of running costs which includes data that allows a direct comparison of the fuel costs betweem three popular "large cars" running on petrol versus LPG.

For the Ford Falcon XT 4.0L auto, the RACV lists 11.44 cents per km for petrol, versus 6.44 cents per km for LPG. This is a difference of $800 per 15,000 km.

In the UK, Fleet News publishes average pump prices each week in pence per litre, the prices for 23 March 2006 being:

LPG44.6p
Unleaded Petrol90.0p
Super Unleaded95.5p
Diesel94.2p

The fuel component of running costs is a fraction less than the difference in pump price alone might indicate because of differences in the volume of fuel needed to travel a given distance, as shown by Michigan Propane Gas Association:

Gasoline driving range 1.gif - 3124 Bytes 100 Miles
Propane driving range 2.gif - 2876 Bytes 80-90 Miles
Ethanol driving range 3.gif - 2783 Bytes 70 Miles
Methanol driving range 4.gif - 2464 Bytes 54 Miles
CNG driving range 5.gif - 2333 Bytes 21 Miles

This comparison uses identical vehicles optimized for their specific fuel. The baseline is a gasoline-fueled vehicle with enough fuel to travel 100 miles. Distance shown is based on the relative energy content (British Thermal Units - BTUs) of each fuel gallon.

If all vehicles were fitted with equal-volume tanks, propane gas would require the least fill-ups on a trip, followed by ethanol, methanol, and CNG.

However LPG-L-I’s laboratory tests indicate that the combination of the volumetric effects of liquid injection with our engine management systems are likely to bridge the distance per unit volume of fuel margin between LPG and petrol.

Competitors

The Directors know of three companies with liquid LPG injection kits from the ranks of established LPG kit producers. Those kits appear to sell for substantially more than LPG-Liquid-Inject projected pricing, selling for up to $5,000 versus our predicted $2,500. Their volume, said to be small, should assist our marketing.

LPG-Liquid-Inject, due to the pent up demand, needs to move strongly into the market to ensure that the Company capitalizes on our technical lead, our Australian and US patents, plus copyright.

Demand for high performance

Considerable scope exists in the aftermarket specialties including speed shops.

From enquiries to date, the size of the "hot street car" market may be bigger than originally anticipated and Liquid Injection will do well in this speed-shop market. LPG, due to its higher octane rating, allows compression ratios up to 13:1 with consequent higher efficiency.

Fleet sales

Fleet buyers shouid no longer feel reluctant to recommend LPG as the LI system offers superior performance, lowers emissions and halves fuel costs. LI promises driver satisfaction on top of LPG's good PR and real savings.

Before sales to vehicle manufacturers can be achieved, the revised system will need to be used in the kit market, with taxis and couriers and other end-users, to eliminate any warranty fears or durability concerns. On road data and experience to date has contributed to the current design to reduce such concerns.

Based on representations to the directors, a reasonable estimate is that over 3,000,000 road kilometres have been completed by the 30 vehicles converted by the end of 1992 to the liquid fuel system. That experience has contributed to the current design effectively reducing durability concerns.

Vehicle manufacturers

Such is the move to LPG, it is believed that strong demand will be achieved from vehicle manufacturers within two years. With a major German manufacturer, Manos Kavarnos, an inventor of the liquid injection system, indicated in a market study that 10% of their 2.2 litre vehicles could be sold with Liquid Injection, or 45,000 vehicles p.a.

Most vehicle manufacturers offer LPG as an option-installed at the factory or converted at the time of purchase for some models. In Europe, Volvo offers fully factory-assembled bi-fuel cars with equipment specifically designed and tested for Volvo. Vauxhall Motors in the United Kingdom offers three models with a bi-fuel option. In the United States, a Ford bi-fuel pickup truck is available. Mitsubishi offers LPG passenger cars in Japan, where they are used primarily as taxis.

In a large mature industry like motor vehicle manufacturing, leading companies rarely rush to adopt new technology until public pressure, competition and legislation forces it upon them.

However, vehicle manufacturers have already seen significant demand for LPG fuel systems when offered as an option for new car delivery for passenger, fleet and commercial vehicles. The availablity of the LI system should greatly increase that demand.

New engines are being produced which have been designed to optimise the benefits of LPG as a fuel. Ford is most prominent in Australia.

Full conversion or dual fuel?

With the wide geographical spread of LPG retail outlets the trend is to mono LPG, the fear of not being able to get LPG having receded.

For most taxis, couriers and fleets, mono LPG is the obvious choice.

Other spark ignition engines

The LI system has been designed to be versatile and have broad application across many modes of transportation. The system is designed to handle from one to sixteen cylinders and varying resistance loads from injectors, peak and hold injectors, or saturated field injectors.

Scope for using LI extends from passenger car engines to trucks and other heavy-duty vehicles that can use spark ignition (SI) engines. Some 70,000,000 vehicles produced p.a. come under this umbrella.

Buses and other heavy duty vehicles generate a significant proportion of harmful emission and are an area of focus for governments worldwide.

The main development in Europe with heavy-duty vehicles has been in the bus market. Vienna has for nearly 40 years used DAF engines in buses and they have over 400 buses running on LPG with no significant logistical or safety problems.

DAF started producing LPG buses for the market in the Netherlands. They use the same proven and reliable technology as is found in modern gasoline cars i.e. three way catalysts served by a Lambda control exhaust system. The only difference is that they use liquid injection of the LPG instead of gasoline. This enables vehicles to reach NOx reduction as required and provides a much cleaner exhaust gas than the diesels. More than 1000 of these engines are currently operating in European cities like Paris or Copenhagen.

Due to important combined efforts of both engine manufacturers and some oil companies to promote the environmental performance of LPG buses, they are found in many cities around Europe. You will see from the table below that gas powered buses are now a common sight in many places.

Inventory of LPG Buses for the European Union (2002):

CountryNo. of Buses
Austria (Vienna)550(MAN)
Czech Republic80
Denmark (Copenhagen)270
Spain (Vallodolid)98(MAN)
France—Paris130
Italy25(DAF)
The Netherlands (Utrecht)150
Poland85

Source: European Liquefied Petroleum Gas Association

Forklifts, boat engines, industrial and agricultural engines are all candidates for LPG and Liquid Injection.

Forklifts are large LPG users and now need liquid injection as all new forklifts now have petrol fuel injected SI engines, which are not well suited to LPG vapour systems of the old carburettor days. Forklifts are a large market. Sales of 4,000 LPG fuelled forklifts are expected in Australia, whilst Linde of Germany is said to build 25,000 LPG fuelled forklifts annually.

LPG as diesel supplement

While LPG cannot completely replace diesel fuel in diesel engines, there are major emission gains for new diesel-to-LPG systems using a mixture with up to a third LPG in mobile engines and a half in stationary engines.

Liquiphase components were supplied for some time to Natural Gas Vehicles who used them in their own conversions, but without the LI System's engine management system. The company has received feedback from one of the installers that the components met performance requirements. These conversions included a V16 train.

The US Environmental Protection Agency (EPA) has estimated 11 million diesels in use need to be retrofitted or replaced in the next 10 years to meet emission standards. The LI System provides the best diesel substitution system, creating a LPG/Diesel Dual Fuel System which pays for itself due to the much lower price of LPG versus Diesel.

According to a Press release by the LPGA, 2004/8/13, "In recent independent pan-European tests, vehicles running on LPG were shown to emit only 1/20th of the NOx of a diesel vehicle and 1/100th of particulates." The test also showed that for CO2 production well to wheel, the vehicles running on LPG were on average 20% better than petrol and nearly 2% better than diesel.