A system and method for converting animal waste, in the form of waste slurry, to energy and useful byproducts. A screen mesh filters out large objects from waste slurry and the filtered slurry is chopped and fragmented to reduce binding of fibrous materials. The fragmented slurry is mixed at a rate to maintain solids in the fragmented slurry in suspension while minimizing aeration and turbulence within the mixing unit. A solids recovery unit recovers about 95% of the suspended solids. A polymer is introduced into the solids recovery unit for providing agglomeration of solids particles. The recovered solids are gasified to produce at least methane/ethane gas. The produced gas is provided to an energy production unit to generate electrical and/or heat energy. Liquid remaining after the solids recovery is treated to remove undesirable contaminants to an extent in compliance with water quality standards set for animal waste flushing, animal washing and animal drinking water, as the case may be.