Pyrolysis Project in West Lorne, Ontario Sets Stage for Future Plant: DynaMotive Energy Systems Announces Developments in Canada and Internationally

VANCOUVER, British Columbia -- December 21, 2004 --DynaMotive Energy Systems Corporation (OTCBB:DYMTF) announced that it has established project development opportunities in Canada and internationally that would follow the commissioning of the West Lorne project. The Company plans include targeting the development of 800 tonnes per day of processing capacity and to continue to build its order book in 2005, having registered strong interest for its technology and process. The West Lorne project has a capacity of processing 100 tonnes of biomass per day.


Plans for the development of a 200 tonnes per day plant in Ontario, Canada are in place. Further, it was disclosed that technical feasibility, business and financial analysis for further plants in Canada, Europe and Latin America where DynaMotive has established engineering agreements have been completed.

The sites selected for the first round of development are located in low-risk jurisdictions, have secure biomass supplies (wood, corn husks and sugar cane residues) and good infrastructure support. Off-take opportunities for the product output from the plants have been established in principle as a result of the price competitiveness to hydrocarbon fuels that the pyrolysis products are targeted to displace.

BioOil has been demonstrated to be an effective low sulphur, low particulate, green house gas neutral fuel produced from a renewable resource. BioOil is capable of replacing hydrocarbon fuel oil, natural gas and propane in boilers and kilns, as well as being used in Magellan Aerospace’s bio fuel capable gas turbine.

PROJECT UPDATE:

The plant at West Lorne is expected to begin operations in the New Year, having received the certificate of completion by its main contractors. Plant commissioning is progressing with the major components and process loops successfully tested and operating at design standards.

A draft version for acceptance by DynaMotive of the Certificate of Authority is now expected to be issued prior to year-end from the Ministry of Environment in Ontario and connection to the grid has been confirmed for January 8th 2005. Upon receipt of the certificate and connection to the grid, final commissioning will take place and production of BioOil will commence. The Company’s commissioning timeline for December 2004 was dependant on the above certifications being received.

The West Lorne BioOil Cogeneration Project has secured a Cdn $5 million contribution from Sustainable Development Technology Canada (SDTC) for its development and demonstration phases, including plant commissioning. STDC is a foundation created by the Government of Canada that operates a $350 million fund to support the development and demonstration of clean technologies that address issues of climate change and air quality. These solutions deliver environmental, economic and health benefits to Canadians. An arms length, not-for-profit corporation, SDTC works with private, financial, academic and public sectors and with the Government of Canada to build a sustainable development technology infrastructure in Canada.

DynaMotive is an energy systems company focused on the development of innovative energy solutions based on its patented fast pyrolysis system. Through the application of fast pyrolysis, DynaMotive unlocks the natural energy found in the world’s abundant organic resources traditionally discarded by the agricultural and forest industries. DynaMotive’s technology economically converts biomass into a renewable, environmentally friendly fuel. DynaMotive has successfully demonstrated conversion of these residues into fuel known as BioOil, as well as char.

Forward Looking Statement

Statements in this news release concern the company’s business outlook or future economic performance; its anticipated ability to deploy the 800 tpd plant capacity in 2005, or other financial items; and statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters, are “forward-looking statements” as that term is defined under the Federal Securities Laws. Forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from those stored in such statements. Such risks, uncertainties and factors include, but are not limited to, the fact that the Company currently needs significant additional capital to meet its objectives and such capital may not be available on terms acceptable to the Company or at all, changes and delays in product development plans and schedules, customer acceptance of new products, changes in pricing or other actions by competitors, patents owned by the Company and its competitors, and general economic conditions, as well as other risks detailed in the Company’s filings with the Securities and Exchange Commission.

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