xénos filters Fuelactive™ deal

20/03/07

Fuel contamination can be a costly business, as highlighted by recent events, but a Cardiff-based firm has developed a unique solution to the problem in heavy industry with the support of a syndicate of investors in a deal brokered by xénos, the Wales Business Angel Network.

Fuel contamination causes industry to incur huge costs each year through breakdowns, repairs and replacements. Up to 90 per cent of these problems are the direct result of contaminants that enter fuel systems through mixing, transferring and during storage.

The problem is particularly severe for the plant hire sector where businesses are constantly looking at ways to improve efficiency and profit margins.

Fairwater Fuels, based in St Mellons, Cardiff, has developed an innovative solution - FuelActive™ - to combat the costly issue of diesel contamination in plant and machinery. The company turned to xénos, the Wales Business Angel Network for investment to commercialise the product.

“Most fuel filtration systems draw fuel from the bottom of the tank where water and other contaminants collect. During refuelling the water and contaminants will be drawn into the fuels system and over a period of time the filters will become saturated and the equipment will breakdown, said Michael James, Managing Director of Fairwater Fuels who had the original idea for FuelActive™.

“FuelActive™ works by using a float to track the level of fuel in the tank, drawing fuel from the upper limit of the fuel level ensuring that the throughput of water and other contaminants is reduced by more than 300 per cent, allowing the equipment to run for longer periods of time before servicing or breakdown.

Mr James brings more than 27 years experience in the construction equipment industry to the project and had the original idea for FuelActiveTM in 1999 after experiencing first hand the extent of the problem. He has been involved in the design, development and testing of the product from its outset.

He added: “The market applications for the FuelActive™ device are endless. However, we identified industrial plant and other diesel powered equipment - such as generators and pumps - as being the equipment most likely to benefit from our product.

“Plant hire is a buoyant but competitive market with very tight margins. FuelActive™ enables plant hire companies to achieve substantial cost savings through reduced time spent on call outs and breakdowns and in addition will reduce the incidence of lost revenue when plant and equipment is out of commission awaiting repair.”

Mr James said his goal was to have the device as a standard fitting on new equipment. However, he said there was a need to change the attitude of the industry to make them more proactive to preventing the problem, rather than reactive when they had breakdowns and unreliability due to contaminated fuel.

Test results on the product show the water/diesel separation efficiency exceeds 94 per cent, compared to 2.3 per cent in a conventional system. Mr James said one customer had even experienced zero fuel related breakdowns since FuelActive™ was fitted to their fleet in 2002.

He was told about xénos and the investment opportunities it can provide by his Business in Focus mentor. Already introduced to investors Bill Snowden, Kevin Harnet and Martin Leahy, xénos introduced David Bundred, an investor who fully understood the FuelActive™ product and its market potential.

xénos Regional Manager, David Maas, said: “Fairwater Fuels is an excellent example of how matching the right investor with the right company can bring benefits over and above the money invested.”

Commenting on the investment xénos investor, David Bundred, said: “With my background in manufacturing and heavy industry I was immediately attracted to the potential of the FuelActive™ system and have been delighted with my investment. I am looking forward to working with the team and see exciting times ahead.”

For further details of xénos, the business angel network, please contact David Maas, South Wales Regional Manager on Cardiff 02920 338144, or visit www.xenos.co.uk.