SOURCE: Alternative Fuel Technologies

December 09, 2009 18:15 ET

Alternative Fuel Technologies Awarded Phase 2 Army Contract

REDFORD, MI--(Marketwire - December 9, 2009) - Alternative Fuel Technology, LLC, a wholly owned subsidiary of Alternative Fuel Technologies, Inc. (PINKSHEETS: AFTC), announced today that they have been competitively selected for negotiation and possible award by the U.S. Army for a Phase 2 SBIR project. The project is valued at $730,000.

The Phase 2 project is an extension of a successful Phase 1 project where AFT identified a significant wear problem on a commercial diesel common rail fuel injection system running on JP-8 jet fuel. The Army uses JP-8 jet fuel in all of its diesel applications for logistics reasons.

In the Phase 2 project, AFT will redesign the commercial diesel common rail pump to lower wear to acceptable levels. To accomplish this goal, AFT will apply materials technology and other lessons learned during the development of their well known DME common rail fuel system.

About SBIR's:

DoD's SBIR program funds early-stage R&D projects at small technology companies -- projects which serve a DoD need and have the potential for commercialization in private sector and/or military markets. The program, funded at approximately $1.23 billion in FY 2009, is part of a larger ( > $2 billion) federal SBIR program administered by twelve federal agencies.

As part of its SBIR program, the DoD issues an SBIR solicitation three times a year, describing its R&D needs and inviting R&D proposals from small companies -- firms organized for profit with 500 or fewer employees, including all affiliated firms. Companies apply first for a six-month to nine-month phase I award of $70,000 to $100,000 to test the scientific, technical, and commercial merit and feasibility of a particular concept. If phase I proves successful, the company may be invited to apply for a two-year phase II award of $500,000 to $750,000 to further develop the concept, usually to the prototype stage. Proposals are judged competitively on the basis of scientific, technical, and commercial merit. Following completion of phase II, small companies are expected to obtain funding from the private sector and/or non-SBIR government sources (in "phase III") to develop the concept into a product for sale in private sector and/or military markets.

About AFTC:

Alternative Fuel Technology Inc. is a research & development organization engaged in the design, development and prototype manufacturing of advanced fuel systems for use with a new alternative fuel -- dimethyl ether (DME). AFTC has developed practical, low-cost fuel injection equipment for DME fueled vehicles and currently provides complete DME fuel systems for testing and research purposes in addition to retrofit systems that can be used with most diesel engines. The company's ultimate goal is series production of DME fuel systems for the global automotive market by 2011.

About DME

DME is a new ultra-clean diesel fuel replacement that can be produced from abundant resources. These include natural gas, landfill methane, coal and biomass. At current oil prices, DME can be produced and distributed at less than 1/2 the cost of conventional fuel. When burned in a diesel engine, all soot emissions are eliminated and NOx emissions are lowered dramatically without the use of expensive exhaust aftertreatment devices.

Safe Harbor Statement: Statements contained in this release, which are not historical facts, including statements about plans and expectations regarding business areas and opportunities, acceptance of new or existing businesses, capital resources and future business or financial results are "forward-looking" statements. You should not place undue reliance on these forward-looking statements. Such forward-looking statements are subject to risks and uncertainties, including, but not limited to, customer acceptance of our products, our ability to raise capital to fund our operations, our ability to develop and protect proprietary technology, government regulation, competition in our industry, general economic conditions and other risk factors which could cause actual results to differ materially from those projected or implied in the forward-looking statements. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made, and our future results, levels of activity, performance or achievements may not meet these expectations. We do not intend to update any of the forward-looking statements after the date of this press release to conform these statements to actual results or to changes in our expectations, except as required by law.

Further information on Alternative Fuel Technologies Inc. is available at: http://www.altfueltechnology.com/

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