Alternative Fuel Technologies, Inc. Awarded Option to Phase I U.S. Army Contract

REDFORD, Mich., Jan. 19 /PRNewswire-FirstCall/ -- -- Alternative Fuel Technology, LLC, a wholly owned subsidiary of Alternative Fuel Technologies, Inc. (Pink Sheets: AFTC) announced today that the Company has been awarded a $50,000 option to its Phase I Army Small Business Innovation Research (SBIR) contract, which was completed in late July 2009.

This project involved accelerated testing and analysis of a high pressure fuel injection pump running on JP-8 jet fuel. The Army has a policy to use a single fuel (JP-8) for all of their "vehicles" and engine-powered equipment including turbine powered tanks, helicopters, trucks, HUMVEES, and generators.

"The Phase I accelerated testing identified very high pump component wear, creating the need for design improvements. These improvements will be made under a Phase II contract that has been accepted and is now in the final contracting stage," said James McCandless, Chief Executive Officer of Alternative Fuel Technologies, Inc.

The option award allows AFT to continue concept design work while a Phase II contract is formalized.  

In the Phase II 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.

Phase II SBIR contracts typically range from $500,000 to $750,000 to further develop a 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.

The Company is also engaged in other advanced fuel system projects for the U.S. Army to help resolve the durability and reliability problems JP-8 presents for many types of commercial fuel injection systems. AFT is uniquely qualified for these projects, as Mr. McCandless was a pioneer in this type of diesel fuel injection system.

About Alternative Fuel Technologies, Inc.

Alternative Fuel Technologies, 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).  The Company 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. For more information, visit http://www.altfueltechnology.com

About DME:

Dimethyl ether 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.

SOURCE Alternative Fuel Technologies, Inc.

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