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Hexagon Composites' subsidiary Hexagon Raufoss has been nominated by an international vehicle modifier, to supply compressed natural gas (CNG) fuel tanks to Natural Gas Vehicles (NGV). The NGV car model will enter the European market during second half of 2016.
According to the agreement, the first deliveries are targeted for end of second quarter 2016, and the program is scheduled to run for up to seven years. The estimated overall delivery value is around NOK 150 million (approximately USD 18 million).The nomination will further strengthen their cooperation with NGV modifiers in Europe. They experience that the increased global focus on emissions drives the demand for compressed natural gas and other alternative fuels by choosing vehicle storage technology that reduces emissions and fuel costs, comments Ragnar Holthe, Managing Director of Hexagon Raufoss.The environmental benefits of reduced particulates, NOx, SOx and CO2 emissions, continue to attract customers and investments towards adopting Natural Gas Vehicles. In addition, the stability of CNG prices remains attractive compared to relatively volatile diesel prices.Hexagon Composites previously announced that Hexagon Raufoss restructured its operating model to achieve profitable operations. The recent nomination fits well into the new model.About Hexagon Composites:Hexagon Composites ASA is a leading global supplier of composite pressure cylinders for gas applications. Based in Ålesund, Norway, the Group generated NOK 1 651 million in operating income in 2014. Production is carried out in modern, automated plants in Norway and the US.More information: www.hexagon.no