U.S. Department of Energy to Develop Next Generation Hydrogen Storage Technology

IRVINE, Calif., May 4, 2004 -- Quantum Fuel Systems Technologies Worldwide, Inc., announced today that it has finalized the contractual terms with the U.S. Department of Energy and has commenced Phase I of its $2.6 million program for the development and advancement of next generation hydrogen storage technologies.

Quantum and the U.S. Department of Energy will work under a Cooperative Agreement to advance hydrogen storage systems in preparation for fuel cell vehicle commercialization. The overall project will optimize Quantum's 10,000-psi technology, previously developed by Quantum and the U.S. Department of Energy, to deliver the next generation hydrogen storage.

Phase I of the three-phase program involves advanced material characterizations, optimized engineering designs, and alternative processes to develop lower cost, high efficiency hydrogen storage systems. Subsequent phases will also include the development of "smart" systems incorporating advanced structural monitoring systems in collaboration with U.S. Department of Energy's national laboratories.

"This project leverages the previous efforts of Quantum and the U.S. Department of Energy to develop the world's first, and what remains today as the only, validated and certified 10,000-psi hydrogen storage system for vehicles," said Alan P. Niedzwiecki, President and CEO of Quantum. "We are currently manufacturing hydrogen systems that are capable of delivering enough fuel to achieve a 300 mile driving range. This project will focus on optimizing our technology for wider spread commercialization beyond the current early adoption phase. This optimization includes improving storage capacity, while reducing weight and costs, without negatively impacting the safety performance that we have already demonstrated."

Quantum is a world leader as a Tier 1 OEM supplier of ultra-lightweight hydrogen storage and related fuel systems. Quantum's TriShield(TM) tank is comprised of a seamless, one piece, permeation resistant, ultra-high molecular weight polymer liner that is over-wrapped with multiple layers of carbon fiber/epoxy laminate and a proprietary external protective layer for impact resistance. Quantum's TriShield(TM) hydrogen storage technology has been validated for service pressures up to 700 bar (10,000 psi) following proposed European, Japanese, U.S. and other international hydrogen standards and regulations.

About Quantum

Quantum focuses on three primary product and system applications: Transportation, Fuel Cell Stationary Power Generation and Hydrogen Refueling Infrastructure. The company manufactures both components and end products. In the Transportation sector, Quantum designs and supplies state-of-the-art fuel system technologies to many of the world's leading OEMs with Hydrogen systems for both Internal Combustion Engine (ICE) and Fuel Cell applications, and Natural Gas and LPG fuel systems for ICE applications. In Stationary Power, Quantum currently supplies components and integrated systems to developers of Fuel Cell stationary power products and is working to expand its product portfolio in these applications. In the area of Refueling Infrastructure, Quantum offers several hydrogen and natural gas refueling systems focused on early infrastructure development, targeting fleets of one to 20 vehicles.

Quantum 's ultra-light weight composite fuel storage, fuel injection and metering technologies, electronic control products and OEM-level systems integration capabilities have enabled the company to develop a product portfolio with state-of-the-art technologies and products, a diverse customer base, and alliances with partners such as General Motors and Sumitomo Corporation.

Quantum is a Tier 1 OEM supplier and a member of the GM Fuel Cell Alliance of fuel cell commercialization companies. Quantum 's customer base includes General Motors, Toyota, Opel, Hyundai, Suzuki, Ford, Sunline, Yamaha and AeroVironment.

Quantum's web site: www.qtww.com.