Exhibit
4.32





Letter
      of Intent  Between Valcent Products and the Hydoganics Joint
      Venture1





Valcent
Products (“Valcent”) and the Hydroganics Joint Venture, being a 50/50
unincorporated joint venture between Paul Davies and Armando Formica which may
later be incorporated, (“Hydro”), have had discussions regarding Valcent’s High
Density Growing System (“VGS”) for vegetables excluding any grains.





Valcent
is currently seeking to raise funds through a private placement of units whereby
a unit is priced at 60 US Cents and is comprised of one ordinary share fully
paid and one warrant. The warrants entitle the warrant holder, for each TWO
warrants held , to purchase ONE share at 75 cents per share for a period of up
to two years from the closing of the private placement.





All
investment in the private placement will be governed by the existing
subscription agreement.





Hydro
seeks to obtain the exclusive rights for the country of Australia.





Both
Hydro and Valcent agree that it is their intention that Hydro have exclusive
rights to Australia for VGS on the following basis.





Hydro
will seek to raise US$2,500,000 for Valcent as part of the existing private
placement. Such monies may come directly from Hydro or from independent
investors. Usual fees for such raising shall be paid to the Hydro joint
venturers but shall not include Valcent should Valcent be a joint
venturer.





Valcent
shall have a 30% equity interest in Hydro maintained up to the level where Hydro
has raised the equivalent US$10million in whatever form for the development and
commercialisation of VGS in Australia. Thereafter Valcent shall have anti
dilution rights to purchase 30% of any further equity issue. This will be
governed by a shareholder agreement covering but not limited to purchase for
either party, board representation, etc.





Hydro
undertakes that within 12 months of receiving all necessary data in relation to
VGS to enable the development and construction of an economically viable VGS
unit it will produce such unit in Australia. If hydro fails to do so Valcent ,
at its sole discretion shall have the right to remove Hydro’s entitlement to the
territory of Australia.





In the
event that Valcent has failed to deliver the necessary data for the construction
of an economically viable VGS unit in Australia by April 30th 2009
then Valcent shall pay to Hydro compensation for costs incurred in relation to
this project or reasonable amount for time spent by the Hydro
parties.





Valcent
shall provide all IP and design and engineering materials required for the
building of a VGS unit at no cost to Hydro. Any supplies and equipment provided
to Hydro by Valcent shall be sold to Hydro at Valcent’s cost.


Valcent
shall offer to Hydro any future and on-going developments in VGS as they relate
to fruits and vegetables together with any design and engineering changes or
modifications on the same cost basis as above.





Valcent
shall provide a detailed description of VGS as it is currently known including
description of any patents or patents pending.





In
addition, on completion of Hydro’s share purchases as well as Hydro successfully
completing the commercial production from its first VGS, then Valcent shall
offer first rights to deploy VGS, and any related or subsequent VGS
modifications to HG for a term of 3 years with the right to renewal on certain
conditions yet to be discussed.




Valcent
and Hydro shall form a management working relationship to discuss and resolve on
going issues relating to any unique needs regarding the commercialization of VGS
in Australia which would include local availability of parts and equipment,
supplies, local weather issues, rules and regulations governing such a business,
consumer habits, etc.




Hydro
shall honor Valcent’s current royalty agreement with Pagic,( a Texas LLC)
 and West Peak Ventures of Canada Ltd, a Canadian Limited Company, who
jointly own a total royalty of 4.5% of gross receipts.  The agreement will
be an appendix to any letter of understanding or formal agreement between the
parties.




In the
process of deploying the VGS in Australia and any other territories, and in the
event of doing so, other designs and/or modifications of any nature have created
new or additional intellectual properties, then the property will be owned by
Pagic Inc and as such, the same royalties as described above will also apply.
Hydro will have the same commercial use of any new intellectual property on the
same terms as described above.


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Valcent
shall be obligated to keep the current and any subsequent intellectual
properties free and clear of any obligations and or liabilities of any nature
that may effect the on going business of Hydro. Hydro shall also have on going
rights to protect itself if Valcent becomes a bankrupt corporation and or fails
to deliver product as agreed upon.




At such
time as Hydro has completed its equity purchases as well as having the first VGS
in commercial production, then Hydro shall have earned the first right of offer
to participate in the commercialization of the Vertigro Algae project within the
territory of Australia.  In doing so, Valcent shall seek the approval of
Vertigro, LLC, to honor the same.




In
summary, the agreement between the parties will include the points described
above, with the following appendix required:




-
        a shareholder’s
agreement;


-
        a royalty agreement


-
        a design description of VGS,
including any patents or patents pending












































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