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SONIC heavy oil upgrader project with Mirex

Posted on: Tuesday, 2 June 2009, 08:00 CDT

TSX Venture Exchange Symbol: SNV

VANCOUVER, June 2 /PRNewswire-FirstCall/ - SONIC Technology Solutions Inc. ("SONIC" or "the Company") is pleased to announce today that it has entered into a joint venture agreement ("JV") with Mirex Energy Inc. to construct and operate the first PetroSonic heavy oil upgrader in Canada. Mirex is an oil production and services company operating in the Lloydminster region and will be the operating partner in the JV. The project will initially be designed for a 1,000 barrels per day (bpd) facility to be located on the Elizabeth Metis Settlement in Alberta. The PetroSonic facility will be designed to upgrade local heavy oil supplies to meet the minimum API requirements for Canadian pipelines.

Mirex will provide facilities for the installation and initially manage the operating contracts. SONIC will grant a license for its proprietary PetroSonic upgrader technology and manage the installation and start-up. Mirex and SONIC will be equal partners exclusive of any interest in the project by the financing partners. Capital financing for the project will be provided as debt and/or equity into the project.

This will be the first PetroSonic upgrader in Canada and will allow SONIC to fully implement the process in a modular plant design which allows the process to be run in various configurations to allow for process optimization and data. The PetroSonic upgrader is a low temperature and pressure process utilizing a SONIC reactor for de-asphalting and an oxidation process to further upgrade the oil. The economics of the project improve as the price differentials between heavy oil and pipeline specification - predominantly viscosity and density driven. Successful operation of the first installation would anticipate expansion to 3,000 bpd on a self-financed basis.

The license granted to the JV is exclusive for all Metis settlements in Canada and allows Mirex and SONIC to expand the operations of the JV to other locations or to enter into new agreements for each location. Heavy oil will be supplied in part by related parties and supplemented by independent local production. Upgraded oil will be sold into the pipeline system.

Archie Collins, Chairperson for the Elizabeth Metis Settlement, commented "We have a very successful partnership with Mirex and this project offers local oil producers, Metis and others alike, the opportunity to build our local oil processing facilities. We have plans for related oil services which may integrate very well with the upgrading facility."

Energy Invest Ltd. are reviewing the project under their marketing and financing agreement with SONIC, either to provide part of the financing for the project or as part of a more comprehensive financial proposal they have recently presented to SONIC. Local financial participation will also be accommodated. Energy Invest have identified several projects where they would like to utilize the PetroSonic upgrader technology. Energy Invest is also a major shareholder and fully supports this first project in Canada to ease the logistics of technical support. The project will commence with detailed engineering and permitting this summer. Preliminary engineering for the upgrader has been completed and design data from an extensive test program on Lloydminster oils is already available. SONIC and Mirex have made application under the Alberta Energy Research Institute program and the project is directly in line with recent initiatives by the Alberta Government to encourage more processing within the province. SONIC may also be eligible under other Canadian grants in place to improve efficiencies in heavy oil production.

About Mirex Energy Inc.

Mirex is a private company providing oil services in the Lloydminster area. Mirex has diverse operations and interests including oil production and oil field operations and services. The Elizabeth Metis Settlement is a major shareholder in Mirex.

About SONIC and PetroSonic

PetroSonic upgrading technology utilizes a proprietary oxidation process and the SONIC reactor technology in a deasphalting process developed by SONIC. The PetroSonic upgrading process incorporates de-asphalting and oxidation stages in a low temperature and pressure process specifically targeted to allow smaller scale low energy upgrading for regional and independent producers of heavy oil.

About Energy Invest Group

Energy Invest Group is a private UK company that identifies cutting edge energy and environmental technologies and deploys them in industrial scale projects (See www.energyinvestgroup.com). Energy Invest is one of SONIC's largest shareholders and is actively planning additional projects for SONIC.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed under the heading "Risk Factors" and elsewhere in the Company's periodic filings with Canadian securities regulators. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. The Company does not assume the obligation to update any forward-looking statement.

SOURCE Sonic Technology Solutions Inc.

Source: PR Newswire

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