ETX Systems

Press Release

Date: June 13, 2007

Alberta government to provide support for the commercial development of the ETX Upgrading technology

CALGARY, AB – ETX Systems Inc. has received notification that their application for support to the Alberta Energy Research Institute (AERI) for a commercial demonstration of their ETX Upgrading technology has been approved, subject to a successful demonstration of the technology at a 1 bbl/d scale. Feed into the 1 bbl/d pilot unit, referred to as the D1 project is scheduled for July 2007.

AERI (www.aeri.ab.ca) is an Alberta government initiative that works with industry and other government ministries to promote innovation and technology that will enable Alberta's energy sector to evolve. Part of AERI's mandate is to invest technologies that will enhance the sustainable development of the province's abundant energy resources.

ETX Systems had applied to AERI under a new investment initiative entitled, "The Next Generation Clean Carbon/Coal and Hydrocarbon Upgrading Technologies." After being successfully evaluated in Phase 1 of the competition, ETX Systems was invited to submit a formal application.

"We have been very impressed with the process put in place by AERI. They have truly proven their ability to liaise between industry, government and the development communities.", explains Wayne Brown, COO and CTO of ETX Systems. "The application process was extremely intense, with a rigorous prescreening process involving highly qualified technical and business people. A long list of technologies was considered. After succeeding at this round we were asked to submit a formal application."

Gerard Monaghan, CEO, views the evaluation process as important as the end result. "AERI involved a large fraction of the business leaders within our industry in the application process. Passing the scrutiny of this group certainly indicates that we are on the correct track."

The terms of AERI's involvement are currently under negotiation. In principal AERI has agreed to fund one third of the engineering costs associated with the planned commercial demonstration plant, pending successful completion of a due diligence exercise on the 1 bbl/d pilot demonstration unit. ETX Systems is free to apply to AERI for support for the construction and operation of the planned 2,000 bbl/d plant at a later date.

"The method by which AERI has chosen to support projects under this program is typical of any company operating in this or any industry. Financial commitments are linked to milestones, a process referred to as 'stage gating'.", says Monaghan. "This rational approach adopted by AERI again speaks to the experience that they have within their organization."

Details of the AERI funding program were can be found in a presentation given by AERI to the Hydrocarbon Upgrading Task Force.

ETX Systems Inc. is a fit-for-purpose private entity based in Calgary, AB, whose sole mandate is to commercialize its patented IYQ Upgrading technology. The process claims to deliver revolutionary yields and qualities relative to delayed coking, for significantly less cost per barrel. The increased production of high quality liquids leads to reduced environmental impact, leveraged through both the upstream and downstream scope.  For more information contact Gerard Monaghan, CEO of ETX Systems Inc. (gerard.monaghan@etxsystems.com).

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