Ballard Completes Purchase of ALSTOM's Interest in Ballard Generation Systems

    VANCOUVER, British Columbia--Dec. 18, 2002-- Ballard Power Systems (TSX:BLD) announced today that it has completed the acquisition of the interest of ALSTOM Canada Inc. in Ballard's stationary power subsidiary, Ballard Generation Systems Inc. ("BGS"), through the issuance of 2.5 million Ballard common shares. ALSTOM Canada Inc. is subject to a minimum four-year hold period for 1.9 million of these shares, and to a standard four-month statutory hold period for the remaining shares.
    Ballard's relationship with the ALSTOM Group will continue through a member of the ALSTOM Group being granted a non-exclusive worldwide (except for Japan) distribution right for Ballard's stationary fuel cell systems in place of ALSTOM's prior exclusive rights to manufacture and distribute Ballard's stationary fuel cell systems in Europe only. Additionally, the jointly owned company ALSTOM BALLARD GmbH (ALSTOM BALLARD), based in Europe, will continue to oversee the existing European 250 kW stationary field trial program. ALSTOM BALLARD is owned 51% by ALSTOM GmbH and 49% by Ballard.
    BGS was formed in 1996 to commercialize PEM fuel cell stationary power generators that use Ballard(R) fuel cells. After completion of this transaction and the pending purchase by Ballard of the interest of FirstEnergy Corp. (formerly GPUI) in BGS, Ballard will own 100% of BGS.
    Ballard Power Systems is recognized as the world leader in developing, manufacturing and marketing zero-emission proton exchange membrane fuel cells. Ballard is commercializing fuel cell engines for transportation applications and fuel cell systems for portable and stationary products. Ballard is also commercializing electric drives for fuel cell and other electric vehicles, power conversion products, natural gas and hydrogen generator sets and is a Tier 1 automotive supplier of friction materials for power train components. Ballard's proprietary technology is enabling automobile, bus, electrical equipment, portable power and stationary product manufacturers to develop environmentally clean products for sale. Ballard is partnering with strong, world-leading companies, including DaimlerChrysler, Ford, EBARA, ALSTOM and FirstEnergy, to commercialize Ballard(R) fuel cells. Ballard has supplied fuel cells to Honda, Nissan, Volkswagen, Yamaha, Cinergy and Coleman Powermate, among others.

    This release contains forward-looking statements that are based on the beliefs of Ballard's management and reflect Ballard's current expectations as contemplated under the Safe Harbor provisions of the U.S. Private Securities Litigation Reform Law of 1995. When used in this release, the words "estimate", "project", "believe", "anticipate", "intend", "expect", "plan", "predict", "may", "should", "will", the negative of these words or such other variations thereon or comparable terminology are intended to identify forward-looking statements. Such statements reflect the current views of Ballard with respect to future events based on currently available information and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in those forward-looking statements.

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