I've seen recipes that called for mixing paraffin with various solvents like lighter fluid, white gas, etc. in ratios like what you are describing, but Albolene seems to already be mixed. According to the ingredients list Albolene is mineral oil, petrolatum (petroleum jelly), paraffin, ceresin (another type of wax), and beta carotene (vitamin A). I suppose you could dilute it with some sort of solvent, but I really don't see any need to do so. The key seems to be to use just a tiny little drop that you liquify by rubbing it between your fingers before applying it to the fly. Too much and your fly gets goopy. Of course, you can always use the excess as an effective hand moisturizer to help eliminate chapped hands (another problem I have with other floatant products).
Fly fishing - it's cheaper than a bass boat!