SOURCE: Tranzcom

October 03, 2005 12:51 ET

Tranzcom Subsidiary Awarded Contract to Build Coal Mine Monitoring System in China

VANCOUVER, BC -- (MARKET WIRE) -- October 3, 2005 -- Tranzcom China Security Networks Inc. ("Tranzcom" or the "Company") (TSX-V: TSN) is pleased to announce its subsidiary Beijing Tranzcom Technology Co. Ltd. ("BTT") has been awarded a contract to build a Digital Coal Mine Safety Monitoring System by the Linfen City Government of Shanxi Province, China. The award was made after a six month bidding process in which over forty security companies across China participated. BTT's proprietary system, comprised of video monitoring, gas level detection and location sensing, will provide live video surveillance of coal mines around the clock.


China is the second largest coal producer in the world with total production of 2 billion tonnes in 2004. According to government statistics, there are 25,927 coal mines in China, supplying 70 percent of the country's annual energy demand. Shanxi Province is the largest coal producing province in China, representing 40% of China's annual coal production. In the face of this year's rising death toll, the State Administration of Coal Mine Safety of China has ordered over one-fifth of China's coal mines to suspend production and undergo safety overhauls by the end of this year to improve unsafe conditions. Over 6,000 coal mines have been required to stop production and meet national safety standards, failing which, they will be shut down permanently.

In March 2005, Chinese Premier Wen Jiabao announced that the government would spend 3 billion Yuan (approximately CDN$420 million) on safety technologies upgrading this year at state-owned coal mines to "truly make coal mining safer."


This challenge to the China coal mining industry presents Tranzcom with an excellent opportunity to showcase its solution that can help save lives and generate great shareholder value. As such, the pilot system has been installed in one coal mine (you can view the monitoring station for this installation at: Linfen City has plans to invest approximately CND $20M, for which BTT's system will be installed in many of the 448 coal mines in the region. BTT's typical system, average approximately 450,000 RMB or CDN$64,500 per system, represents a very cost-effective solution for coal mines that have currently been shut down and are required to meet national safety standards or face permanent shut down.

Once the company's solutions are proven in Linfen City, the company will be able to roll out the system to the other coal mines in Shanxi province and 12 other coal producing provinces in China which include the 25,927 registered coal mines mentioned earlier.

Tranzcom's VP of Corporate Development, Barry McGowan commented, "Tranzcom's expertise as a network service provider has allowed us to use our technology beyond security alarm monitoring to include environmental monitoring of construction sites in Beijing and now a mine safety system in Linfen. With over 25,000 coal mines in China, we foresee tremendous opportunities in this market segment."

Tranzcom investors are asked to visit the Tranzcom IR Hub at where they can post questions and receive answers within the same day, or simply review questions and answers posted by other investors. Alternatively, investors are able to e-mail all questions and correspondence to where they can also request addition to the investor e-mail list to receive all future press releases and updates in real time.

The Company would also like to announce that it has granted a total of 150,000 stock options to two directors of the Company. Mr. Heinz Frey has been granted a total of 100,000 stock options and Mr. Erick Chai total of 50,000 stock options.

About Tranzcom

Tranzcom China Security Networks Inc. is a leading security network service provider in China, operating a state of the art security dispatch centre in Beijing. Tranzcom's subsidiaries, Beijing Tranzcom Technology Co., Ltd. and Beijing Huaxun Datacom Co. Ltd. design and manufacture security products and provide integrated security service solutions throughout China.

"Barry McGowan"
VP Corporate Development

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