Westport to Develop Biogas, Natural Gas Engines For Volvo

July 13, 2010

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Westport Innovations has signed a new agreement with Volvo Powertrain to develop biogas- and natural gas-fueled engine products for Volvo
. Details of the products or markets were not disclosed.

Under the agreement, Westport and Volvo will mutually agree on the priority for commercial launch of gaseous fuel engines and will share the risks of development.

Westport will be reimbursed for engineering and related development costs for products requested by Volvo. In addition, Westport will arrange for or supply gas-related components. The company expects to generate revenue on each new natural gas and biogas engine sold.

"Our development and commercialization program with Volvo continues to develop, both in scale and scope," said David Demers, CEO of Westport Innovations. "Natural gas and biogas are quickly becoming the alternative fuel of choice for commercial vehicles and we expect this will lead to a new generation of clean, low-emission engines from Volvo."

The current natural gas engine development program will result in an engine that will meet future emission requirements and be commercialized according to a mutually agreed timeline. Westport will also be working directly with the Volvo AB brands to help identify market development opportunities and assist in the infrastructure build-out of biogas and natural gas where needed.

The new agreement stems from an original agreement between the two in November 2009, describing Westport as a Tier 1 Development Supplier for Volvo's heavy-duty natural gas engines and associated supply chain.

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