In Phase I, DDI has signed a purchase agreement for a 200kw refinery at a price of $1.9m and paid $950,000 to the company as down-payment. In Phase II, DDI would acquire the MagneGas technology and manufacturing rights for the greater Chinese market.

As compensation DDI will invest $2m in MagneGas. DDI will create a new China-based Joint Venture company (MagneGas China) to house and administer the rights and DDI would seek to take this Joint Venture company public in the Asian market in the future.

DDI will grant to MagneGas 20% of MagneGas China, giving the company and its investors a significant and perpetual share of China market operations. MagneGas CEO Dr Ruggero Santilli or his assignee will receive a full voting seat on the MagneGas China Board of Directors.

Richard Connelly, president of MagneGas, said: “We have found in DDI a partner not only of substantial resources, but one equally passionate about the MagneGas Technology and its potential benefits to both the environment and the fiscal bottom line.

“Negotiations on specific terms are underway, and we are both pleased and encouraged by the progress we have mutually made in the last week. We look forward to reaching a final agreement favorable to both parties and their constituents — and to MagneGas investors in particular.”