Thermal Energy International Inc.: THERMALONOx Multi-Air Pollutant Control Technology Pilot Plant on Budget and Scheduled for Construction

    OTTAWA--Aug. 27, 2002--Thermal Energy International Inc.

    -- The patented THERMALONOx(TM) pilot plant construction
    tendering process has confirmed that the capital costs will be
    within the expected budget and that the construction can be
    completed during the coming Winter in order to generate Phase
    #I experimental data by the spring 2003

    Thermal Energy International Inc.(TSX Venture Exchange: stock symbol TMG, www.tse-cdnx.com, OR trades in USA through www.pinksheets.com, stock symbol TMGEF) is pleased to announce that THERMALONOx(TM) Multi-Air Pollutant Control pilot plant budget and schedule have been verified through a formal construction tendering process. The Company has received bids from qualified construction contractors, which have confirmed the proposed THERMALONOx(TM) pilot plant design can be implemented both within the expected capital budget and within a 5 to 7 month time frame.
    Gustav Pliva, PhD, PMP, Product Manager, stated, "This is excellent news. The patented THERMALONOx(TM) Multi-Air Pollutant Control technology is a very exciting and promising air pollution control technology for more cost-effectively and safely removing the multiple air pollutants NOx, SOx, and Mercury from the exhaust gases emitted by coal-fired power plants and heavy industry processes. THERMALONOx(TM) is much simpler, safer to operate, and is expected to remove NOx at 30% to 75% lower cost than the currently best available technology (BAT)."
    Thomas V. Hinke, ChE, P.Eng., President & CEO, stated, "We are very pleased that the THERMALONOx(TM) pilot plant has been confirmed for implementation both at an affordable cost and through a schedule which will enable the Phase #I experimental data to be produced in the spring of 2003. Subject to the Phase #I experimental results confirming the patented THERMALONOx(TM) technology viability; several multimillion dollar THERMALONOx(TM) commercial installations, currently under discussion, are expected to follow with potential industrial and utility customers."
    The Phase #I THERMALONOx(TM) R&D is supported by the National Research Council of Canada (NRC) (www.nrc.ca) and Astaris LLC (www.astaris.com). Also see the related TMG news releases dated June 21st, 2002, April 5th, 2002, October 1st, 2001, and July 26th, 2001.

    Thermal Energy International Inc. is a leading environmental and energy technology company since 1986. Headquartered in Ottawa, Canada, the Company is an established designer, developer, fabricator, and supplier of Superior proprietary and patented environmental compliance (air) and energy conservation products and technology solutions. The Company is also a fully accredited professional engineering firm, and offers advanced process and applications engineering services. More on Thermal Energy can be found at www.thermalenergy.com. FLU-ACE(R) is a registered trademark of Thermal Energy. Common shares of Thermal Energy are traded on the TSX Venture Exchange (formerly CDNX) under the symbol TMG.

    The contents of this release have neither been approved nor disapproved by the TSX Venture Exchange (or TSX).