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OriginOil Lands First Order for Industrial Scale Algae Oil Extraction System

Owner of three ‘CO2 to energy’ projects will pilot extraction unit at large coal-fired power plant

Los Angeles, CA — January 25, 2011 – OriginOil, Inc. (OOIL), the developer of breakthrough technology to transform algae, the most promising source of renewable oil, into a true competitor to petroleum, today announced it has received the first commercial order to deploy its algae oil extraction system in an industrial setting.

MBD Energy (MBD) recently committed to purchase an initial OriginOil extraction unit for piloting at one of Australia’s three largest coal-fired power plants.

“OriginOil’s algae harvesting equipment performed extremely well during preconstruction tests at MBD’s R&D facility at James Cook University,” said Managing Director Andrew Lawson, Managing Director of MBD Energy, Ltd.

“We have every confidence that OriginOil’s algae oil extraction technology will meet our high expectations for the next stage,” Lawson added.

MBD Energy expects OriginOil technology to support a pilot Bio-CCS (Bio-based Carbon Capture and Storage) algal synthesizer system at Queensland’s Tarong Power Station.

The proof of concept phase on a one-hectare site, scheduled for later this year, will use concentrated CO2 emissions to produce oil-rich algae in MBD’s proprietary growth membranes. OriginOil’s unique extraction technology will be used to harvest the algae oil and biomass.

“This first extraction system will support early testing at the Tarong site,” said Riggs Eckelberry, CEO of OriginOil. “A much larger unit is intended to replace it later this year to process up to 300 gallons per minute (300 gpm) of algae culture for the one-hectare pilot site, at which point the first unit will be deployed at the next power station pilot site, and so on.”

“Together, the recently-committed initial unit and the full system for the Tarong proof-of-concept site, if approved, may generate as much as US$1 million in product and service sales for OriginOil,” Eckelberry added.

Subject to successful trials and mutual agreement with its power station partners, MBD said each project at Australia’s three largest coal-fired power stations has the potential to grow from an initial one hectare (2.47 acre) proof of concept facility to become fully commercial facilities.

Each facility would then be capable of consuming significant amounts of CO2 and producing commercial quantities of high-value oil suitable for manufacture of transport fuel and plastics.

“We are excited to be building a pilot facility that uses the power station’s CO2-laden flue-gas to feed a Bio-CCS (Bio-based Carbon Capture and Storage) algal synthesizer,” said Lawson. “We expect this to serve as proof of concept for a larger, second stage facility of up to 80 hectares (197 acres) and possibly a much larger third stage project after that.”

MBD estimated that subject to performance at the 80 hectare level and mutual agreements, each Stage 3 full-scale production facility has the potential to grow to 1600 hectares (3,900 acres) and could produce around 300 million liters (over 79 million gallons) of transport (or plastics) oil per year, as well as other valuable commodities, and consume, at full scale, more than half of each power station’s CO2 emissions.

“As a world leader in the extraction of algal oil, OriginOil looks forward to working collaboratively with MBD Energy as technology partners on large scale CO2 to energy projects,” OriginOil’s Eckelberry added.

MBD Energy is regarded as an international leader in technology that securely and efficiently converts captured flue-gas emissions into oil-rich algal biomass.

OriginOil and MBD recently entered into a strategic agreement protecting OriginOil’s intellectual property for demonstration projects and granting mutual marketing rights.

Safe Harbor Statement:

Matters discussed in this update contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this update, the words "anticipate," "believe," "estimate," "may," "intend," "expect" and similar expressions identify such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein, and while expected, there is no guarantee that we will attain the aforementioned anticipated developmental milestones. These forward-looking statements are based largely on the expectations of the Company and are subject to a number of risks and uncertainties. These include, but are not limited to, risks and uncertainties associated with: the impact of economic, competitive and other factors affecting the Company and its operations, markets, product, and distributor performance, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently; and other factors detailed in reports filed by the Company.


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