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DynaMotive and Future Energy GmbH Enter into MOU for Co-Operation in Development of Synthetic Fuels and Chemicals From Pyrolysis Oil and Char Slurries

Posted on: Wednesday, 14 December 2005, 09:00 CST

DynaMotive Energy Systems Corporation (OTCBB:DYMTF) and Future Energy GmbH of Freiberg, Germany, announced today that the companies have entered into a comprehensive Memorandum Of Understanding (MOU) as a first step in the implementation of a strategic alliance. The MOU establishes timelines for the development of agreements in the following areas: 1) Research on gasification of BioOil and BioOil-char slurries for the development of synthetic fuels and chemicals; 2) Development and execution of industrial projects; 3) Establishment of a strategic alliance for joint implementation and marketing of both companies' technologies.

The companies are leaders in their respective fields, namely DynaMotive in fast pyrolysis and Future Energy in entrained flow gasification. The companies believe that a combination of their respective technologies will provide a highly competitive platform for the development and production of synthetic fuels and chemicals from biomass.

One of the main economic barriers in the production of synthetic fuels and chemicals is the cost of transportation of solid biomass to production facilities. With BioOil and char slurries, handling, storage and transportation costs are reduced because the energy density of the BioOil is much higher than that of raw biomass. DynaMotive's technology will allow for conversion of biomass in remote locations and the efficient transportation of biomass energy in the form of BioOil and slurries to large-scale synthetic fuel and chemical facilities.

Future Energy's entrained flow gasification technology has been proven in various applications over a 30-year period. These applications include many different types of coal, petroleum coke, several sewage and industrial sludges, oils, slurries, liquid production wastes and biomass at commercial levels. The technology provides an existing platform for rapid implementation on a large scale.

This MOU is a timely development and follows the introduction of a wide-ranging action plan by the European Union Energy Commissioner that outlines the approach to accelerate the use of biomass energy in transport applications. According to the targets of the EU Directive, by 2010 biofuel consumption in Germany alone must be 2.1 million tonnes annually, representing a market share of 5.75% of aggregate fuel consumption.

Future Energy GmbH plays a major role in the worldwide gasification business as a technology developer and provider. Future Energy is mainly focused on gasification of coal in IGCC applications to power, liquids and chemicals, beneficial recycle of chemical waste and refinery residues, gasification of biomass to liquid fuels and recovery of black liquor. Future Energy is a subsidiary of Sustec Holdings AG, a Swiss-based holding company focused on investments in sustainable technologies.

About DynaMotive

DynaMotive is an energy systems company focused on the development of innovative energy solutions based on its patented fast pyrolysis system. Through the application of fast pyrolysis, DynaMotive unlocks the natural energy found in the world's abundant organic resources created by the agricultural and forest industries. DynaMotive's technology economically converts biomass into a renewable, environmentally friendly fuel. DynaMotive has successfully demonstrated conversion of these residues into fuel known as BioOil, as well as char.

Forward-Looking Statement

Statements in this news release concerning the company's business outlook, future economic performance, partnerships and collaborations as well as financial items and other like statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters, are "forward-looking statements" as that term is defined under the Federal Securities Laws.

Forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from those stored in such statements. Such risks, uncertainties and factors include, but are not limited to: disappointing plant production at a rate or of a quality which falls significantly below expectations and results in a material shortfall from the expected economic value, changes and delays in product development plans and schedules, customer acceptance of new products, changes in pricing or other actions by competitors, patents owned by the Company and its competitors, and general economic conditions, as well as other risks detailed in the Company's filings with the Securities and Exchange Commission.

Source: Business Wire

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