Operating principle As the liquid moves through the gears, a fixed amount is transported through the chambers with every turn of the oval gear pair. Stainless steel pins are embedded in the oval gears and function as magnets. This rotary gear motion is converted in to a pulse signal by electrical sensors externally fitted into the casing. - See more at: http://koboldusa.com/news/product-news/oval-gear-flowmeter-oils-model-ovz#sthash.QUbScpEi.dpuf