Westport Secures NREL Funding for HPDI Truck Program in California

VANCOUVER, British Columbia--Oct. 2, 20042, 2004--Westport Innovations Inc. (TSX:WPT) announced today that it has been awarded US$ 1.5 million by the U.S. Department of Energy's (DOE's) National Renewable Energy Laboratory (NREL) in a cost-sharing subcontract to develop and deploy the next generation of its proprietary HPDI technology in heavy-duty natural gas trucks in California. The total project cost is estimated to be US$ 1.9 million. NREL funding is provided through sponsorship from the DOE "FreedomCAR and Vehicle Technologies" and "Clean Cities" programs.

The trucks being deployed in California will be powered by Cummins ISX engines using liquefied natural gas (LNG) fuel systems and are targeted to meet the U.S. Environmental Protection Agency's stringent 2007 emissions levels for oxides of nitrogen (NOx) and particulate matter (PM). These heavy-duty trucks would be among the cleanest ever deployed.

"We very much appreciate NREL's long-time support and funding for our clean heavy duty engine technology programs," said Dr. Michael Gallagher, Westport's Chief Operating Officer. "This award is significant as it provides the base of funding to take HPDI technology to the next generation. It also reaffirms the U.S. government's continued commitment to natural gas vehicles as a solution to the nation's energy and environmental security issues. We continue to work with our government and industry partners to secure additional resources and expand this heavy-duty program even faster."

"DOE and NREL actively support the development of clean transportation solutions such as Westport's HPDI technology for heavy-duty trucks which has shown the potential to be competitive with conventional diesel technology," said Richard Parish, Senior Project Leader, NREL. "We are taking these critical steps to help reduce oil consumption and make the U.S. less dependent upon imported petroleum."

Westport has engaged strategic and financial partners to participate in a broad program to develop and deploy these advanced vehicles in North America as it continues to strengthen industry awareness and acceptance for HPDI heavy-duty trucks. Through demonstration projects, Westport and its partners are building experience as market interest escalates and market conditions turn favourable for commercial launch of this technology. Under this new program, Westport and NREL will evaluate the fleet's economics, improved fuel economy, reliability, life-cycle and maintenance costs, and environmental performance.

The diesel engine industry is under increasing pressure from regulators and leading customers to reduce emissions. As new regulations force lower emissions, total life-cycle costs for diesel trucks will rise and improve the market competitiveness of cleaner natural gas trucks.

Heavy-duty trucks in the United States consume over 18 billion gallons of fuel every year and account for 22% of total truck fuel use. Diesel exhaust is a major source of particulates, which cause respiratory illnesses and of NOx, which combines with hydrocarbons to generate ground level ozone. According to the California Air Resources Board, diesel emissions account for 80 percent of over-all cancer risks statewide.

Westport Innovations Inc. is a leading developer of gaseous fuel engine technologies. Its joint venture with Cummins Inc., Cummins Westport Inc., manufactures and sells a wide range of engines for commercial transportation applications such as trucks and buses. Westport has technology development alliances in place with a number of leading engine manufacturers, including Ford, MAN, Isuzu, and BMW to develop engines that operate using cleaner-burning fuels such as natural gas, propane, hydrogen and blended fuels such as HCNG.

NREL leads the U.S. Department of Energy's effort to secure an energy future for the United States through energy efficiency and renewable energy technology. Engine and vehicle platform research and development work is primarily through its Next Generation Natural Gas Vehicle (NGNGV) activity.

Note: This document contains forward-looking statements about Westport's business, operations, technology development or to the environment in which it operates, which are based on Westport's estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict, or are beyond Westport's control. Consequently, readers should not place any undue reliance on such forward-looking statements. In addition, these forward-looking statements relate to the date on which they are made. Westport disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.