Syntec Biofuel Inc.
OTC Bulletin Board : SYBF

Syntec Biofuel Inc.

September 28, 2007 18:57 ET

Syntec Enters Into New Acquisition Agreement to Acquire 2nd Generation Catalyst Technology to Convert Biomass Into Ethanol

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 28, 2007) - Syntec Biofuel Inc. (OTCBB:SYBF) today announced that it has today signed a definitive purchase agreement with Montilla Capital Inc. to acquire certain ownership rights to the Syntec Intellectual Property, in respect to the catalyst technology being developed for converting biomass/syngas into ethanol, butanol, methanol and propanol, including all the research and development Assets used at their laboratory.

Development and research of these catalysts commenced in 2001 in laboratories at the University of British Columbia, and since 2005 have been further developed in house. Development has been funded through private equity as well as the Canadian government agencies, National Research Council of Canada and Natural Resources Canada. Syntec is now in Phase 2 development, refining its Catalysts using non-precious metals for long term stability tests under industrial conditions and expects to be ready to file a second patent application within the next 6 months. Syntec has undertaken to raise up US$3 million dollars to ramp up technical staff, purchase equipment and provide working capital for development, testing and quantifying the life of the catalysts prior to commercialization.

The current US demand for Ethanol has increased to over 5 billion gallons per year and is expected to exceed 7.5 billion gallons by 2012. This presents a huge opportunity for the Ethanol industry and for Syntec.

Against the backdrop of the current ethanol boom, analysts concur that ethanol produced from corn is not a long-term solution to America's foreign oil dependence. Discussions increasingly focus on 2nd generation ethanol production technologies that can utilize renewable and waste feed stocks such as wood waste, switch grass, agricultural waste and waste from current ethanol producers i.e. corn stover and sugar bagasse. This 2nd generation process is the core of Syntec Biofuel's technology and generates greater green house gas reduction and carbon credits than the fermentation process.

Currently over 90% of Ethanol production in the USA comes from traditional grain fermentation processes using corn, wheat, sugar or barley. Syntec has been working to produce a breakthrough in ethanol production via the thermo-chemical conversion of biomass to ethanol. Syntec technology focuses on an entirely different Ethanol production process by using a Gasification-Catalytic Synthesis, which is a thermo-chemical process that converts Syngas generated from biomass into alcohols including ethanol, butanol, methanol and propanol. Unlike the current fermentation processes, Syntec's catalysts will produce Ethanol from unlimited sources of feedstock such as municipal waste, wood waste such as saw dust and bark from lumber mills, corn stover and sugar bagasse from existing ethanol producers, waste gas, such as biogas from landfills, sewage, manure, and producer gas (thermal gasification of biomass or other carbonaceous material such as municipal solid waste).

Michael Jackson, President of Syntec Biofuel Inc., says, "The industry recognizes that production of corn to ethanol has a negative impact on consumer food prices and farm land while cellulosic conversion of waste products are going to spawn the next generation of growth in the Ethanol industry. Vinod Khosla, a world known venture capitalist and proponent of cellulosic ethanol production, is heavily invested in proving commercialization of this technology. With oil prices now exceeding $70 a barrel the use of ethanol as a fuel additive is the only option available to reduce our reliance on imported oil."

Syntec's revenue model will be based on Joint Venture projects, licensing fee for use of the Syntec technology and a royalty of approximately 7.5 cents per gallon of alcohol produced plus a commission on the sale of catalysts to licensees.

The Company has agreed to issue 11,000,000 shares in exchange for the Syntec Assets and will assume liabilities not exceeding $350,000. The purchase of the Assets has been approved by the board of Directors of Syntec Biofuel Inc. Syntec's current business is in the animal food and supplement sector, which the Company proposes to phase out in due course.

This acquisition is subject to Syntec raising a minimum of $500,000 by December, 31st 2007 failing which the purchase agreement will terminate.

For more information on Syntec Biofuel Inc., a Washington State Company with headquarters in Vancouver, Canada, please contact info@syntecbiofuel.com. Syntec trades on the OTC.B.B. under the symbol 'SYBF' or call 604-648-2092.

This press release contains statements about future performance, events or developments, which are also known as "forward-looking statements". Forward-looking statements are based on current expectations, estimates, forecasts and projections about us, our future performance and the industries in which we operate as well as on our management's assumptions and beliefs. Statements that contain words like "expects", "anticipates", "targets", "goals", "projects", "intends", "plans", "believes", "seeks", "estimates" or variations of such words and similar expressions are forward-looking statements. Since they relate to future developments, results or events, these statements are highly speculative and involve risks, uncertainties and assumptions that are difficult to assess. You should not construe any of these statements as a definitive or invariable expression of what will actually occur or result. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Some of the risks and uncertainties include: our ability to achieve commercialization, the social, political and economic risks of our operations; changes to existing regulations or technical standards; existing and future litigation; our ability to protect our intellectual property rights and exposure to infringement claims by others; and compliance with environmental, health and safety laws. For a description of these and some other risks and uncertainties, you should read the reports we have filed with the Securities and Exchange Commission, including periodic reports on Forms 10-K, 10-Q and 8-K. Except as required under the federal securities laws and the rules and regulations of the SEC, we do not have any intention or obligation to update publicly any forward-looking statements we make, even if new information, future events, changes in assumptions or any other reason would alter those statements.

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