Friday, October 09, 2009

Clean Air Technology Sign Letter Of Intent with Major Vehicle Manufacturer


Clean Air Power (AIM: CAP) announced it has entered into a Letter of Intent ('LOI') with a major truck manufacturer. The letter outlines a development agreement to deliver a joint demonstration vehicle designed to establish the technical and commercial viability of a jointly produced dual fuel vehicle.


The market reacted well to the news, pushing shares in the company 30% higher.


Clean Air Power's patented Dual-Fuel™ system enables heavy duty diesel engines to operate primarily on natural gas, with diesel fuel acting as a "liquid spark plug". The company holds 62 patents related to the technology, and has installed its product in more than 1600 vehicles worldwide.


The letter of Intent also identifies the possibility of a formal contract and commercial production should the development project prove successful.


In reference to the company’s separate agreement with another truck manufacturer, Clean Air Power also confirmed that it is continuing its active discussions with Volvo. The company plans to update investors as they make further progress towards formal contracts.


At the turn of the year, Clean Air Power Limited announced that it signed a Letter of Intent with Volvo Powertrain (Volvo) to incorporate Clean Air Power's Dual-FuelTM technology into Volvo Truck engines.

According to Clean Air Power the Dual-FuelTM technology will deliver significant greenhouse gas emissions reductions and fuel cost savings compared with standard diesel engines.

Additionally these Dual-FuelTM trucks are expected to be around 20% more efficient than equivalent spark ignited natural gas engines.


Buck