Based on progress to date, including expansion of Protonex facilities and several key senior hires, the Company expects to introduce the first of these products for evaluation by OEMs in mid-2007. Initial products will run on reformed methanol and provide 200 to 300 watts of power for a diverse set of portable applications including emergency services, backup power, military equipment, and leisure applications such as marine and recreational vehicle auxiliary power. In total these applications represent a significant portion of the portable power market for fuel cells, which is expected to produce $2 billion in annual sales by 2011 (Darnell Group 2003).

To support the rapid expansion of its reformer business and other developments, Protonex will double the size of its Massachusetts headquarters, open a branch facility in Bend, Oregon, and hire at least 12 new employees by the end of the year. The Company’s reformer product development team, led by Dr. David Edlund, former co-founder and CTO of IdaTech, Dr. Paul Osenar, Protonex CTO, and Dr. Zhijiang Li, formerly of Aspen Products, has achieved significant technical milestones that are driving the Company forward on its path to commercialization.

“We are pleased with the progress that our team has made on the reformed methanol platform, and are excited about bringing the first of these higher power products to market in 2007,” said Scott Pearson, CEO, Protonex. “Methanol is an ideal first fuel for our larger power systems, and we expect the 200- to 300-watt products to give us increased access to both commercial and military markets.”