SOURCE: Energy Quest, Inc.

September 10, 2007 12:16 ET

Energy Quest Enters Convertible Debenture Financing Agreement

HENDERSON, NV--(Marketwire - September 10, 2007) - Energy Quest, Inc. (OTCBB: EQST), an emerging leader in the development and production of hydrogen-enriched alternative fuels in an environmentally responsible manner, is pleased to announce today that it has entered a private placement agreement (the "Offering") with Vasant Jain ("Jain") of a 0% interest convertible debenture in the principal amount of $120,000,000 maturing on September 4th, 2012. The date of closing will be 10 Days after the posting on the Euro Clear System for verification of the executed documents. Anticipate the closing date to be on or before September 20th, 2007.

Repayment Terms/Conversion. Outstanding principal on the Debenture shall be fully due and payable in compliance with the terms set forth in the Debenture. At the Creditor's option, after September 4th, 2012 (the "Conversion Right Date") and until September 4th, 2017, the Creditor may choose to have all or any part of the outstanding principal owing to the Creditor repaid in shares of Common Stock of the Company (the "Shares") at a conversion rate of US$50.00 per share (the "Conversion Price").

Mr. Vasant Jain will be appointing a nominee to the EQI Board of Directors.

"I am very pleased to be contributing to a company that will be providing green alternative energy technologies to the world. I know this will be the start of many companies that will be doing their part to combat global warming. I am very excited to be involved in and assisting in the growth of Energy Quest," said Vasant Jain.

"This represents the financing sought in May 2007," said Wilf Ouellette, President and CEO of Energy Quest, Inc. "We are very pleased that the conversion into equity is at the same price as the common shares in this financing." The proceeds of the Offering will be used to provide general working capital to finance the expansion of the Company's business and acquisitions of several revenue-producing companies, also retiring all outstanding debts of the Company.

The securities will not be registered under the United States Securities Act of 1933, as amended (the "US Securities Act"), and may not be offered or sold within the United States or to, or for the account or benefit of, "US persons," as such term is defined in regulation S promulgated under the Securities Act, except in certain transactions exempt from the registration requirements of the US Securities Act.

This news release shall not constitute an offer to sell or an offer to buy the securities in any jurisdiction.

About Energy Quest

Energy Quest is a diversified energy company with interests in both conventional and renewable energy sources. Its mission is to bring new technologies to bear to enhance existing energy production as well as developing new energy sources. The immediate objective of the company is to secure energy projects using the PyStR and M2 gasifier and the acquisition of existing, profitable Alternate Energy companies. This would provide significant positive cash flow to the company while being an ideal location for development, demonstration, and operation of many of the company's new technologies. This is the first of many new technologies Energy Quest plans to announce and deploy over the coming months that will demonstrate that it is possible for an energy company to be both environmentally friendly and highly profitable.

Energy Quest through its subsidiaries, Syngas International Corp. and Syngas Energy Corp., is an emerging leader in the development and marketing of low-cost alternate fuels worldwide. We believe our superior technology will catapult our company into a GreenPowerhouse™. With energy prices at high levels and the global focus moving rapidly towards addressing pollution, the need for sustainable, zero emission energy is vital. Our technology is based on clean renewable energy. We foresee our company poised to benefit from global trends.

Forward-Looking Statements

From time to time, the company may issue forward-looking statements, which involve risks and uncertainties. This statement may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as actual results could differ and any forward-looking statements should be considered accordingly.

Contact Information