Alternative Fuel Technologies, Inc. Issues Corporate Update to Shareholders
REDFORD, Mich., March 25 /PRNewswire-FirstCall/ -- Alternative Fuel Technologies, Inc. (Pink Sheets: AFTC), a leading manufacturer of fuel injection systems for government and commercial customers, issued the following open letter from its Chief Executive Officer, James McCandless, to its shareholders regarding current developments at the Company:
Our company made significant strides in 2009 and management is expecting a banner year in 2010.
Last October, we successfully demonstrated our new dimethyl ether (DME) fuel feed pump. Soon after this demonstration, we received an order from the Korean Institute for Energy Research (KIER) for several of our DME fuel feed pumps for a new DME vehicle research project that is slated to begin in June.
Korea is one of several key markets for our DME products. Several months ago, Korea Gas Corp. (KOGAS), the world's largest corporate buyer of liquefied natural gas, announced that it will invest $344 million to build a DME plant in Saudi Arabia, which would have an annual capacity of 300,000 tons of DME starting in 2013.
DME is gaining attention elsewhere around the world as well because it is more inexpensive and cleaner than petroleum-based diesel fuel. Companies like Volvo Truck, which uses DME to power a portion of their fleet, and a major European car manufacturer, which is evaluating DME as a possible passenger car fuel, are beginning to see the value in this low-cost, environmentally friendly alternative to petroleum-based diesel fuel. Japan and India are also working diligently to use DME as a new fuel for heating, cooking, power generation and transportation.
China is perhaps the largest potential market for our company. A key component of its 2008 stimulus plan calls for a $440 billion investment in green energy. By 2010, China expects to have 10 percent of all energy sourced from sustainable resources like biomass, renewable energy and other combination sources like DME. In fact, China produced more than 2 million tons of DME last year, and plans to produce 20 million tons of DME per-year by 2020.
AFT has already penetrated the Chinese market recently announcing new orders for 12 DME feed pumps from Shanghai Diesel Engine Co., a wholly owned subsidiary of Shanghai Automotive Industrial Corporation (SAIC). SAIC currently has a joint venture with General Motors, and operates approximately 50 manufacturing plants in the Shanghai area that make passenger cars, tractors, motorcycles, trucks and buses.
I have personally worked with DME for more than 15 years, and truly believe it is a viable alternative to petroleum-based diesel fuel. DME, made from biomass, offers a very high reduction of carbon dioxide emissions – around 95% – compared to conventional diesel fuel, and it can be produced with very high conversion efficiency at relatively moderate capital cost and can be made from a variety of renewable materials. DME infrastructure requirements are very similar to propane, and retrofitting the current petroleum-based diesel fuel infrastructure for DME can be accomplished very easily and at a substantially lower price than other alternative fuel sources.
In addition to growing our international business, we announced several new contracts from the U.S. Department of Defense's Small Business Innovation Research (SBIR) program.
In January, we announced the award of a new contract with the U.S. Army entitled: "Ultra High Pressure Jet Propellant-8 (JP-8) Fuel Injection System." AFT is also engaged in several other advanced fuel system projects for the U.S. Army including a Phase 2 contract valued at more than $700,000 (final award being negotiated) for the redesign of a commercial diesel common rail pump to lower wear to acceptable levels.
Looking ahead, we are very optimistic about our sales in 2010, and are expecting deeper penetration into key international markets including China and Korea. We also anticipate several new SBIR contract wins, for larger projects ranging from $500,000 to $700,000.
I want to also take this opportunity to reassure our shareholders that we are poised to take advantage of the positive trends in the alternative energy market and our longstanding relationship with the SBIR program, which we believe will result in near-term market share gains.
We believe 2010 will be a very exciting year for Alternative Fuel Technologies and our shareholders. Thank you for your continued support.
Chief Executive Officer
Alternative Fuel Technologies, Inc.
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
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.