US Energy Initiatives Posts Growth

TAMPA, Fla.--Aug. 17, 2006--US Energy Initiatives Corporation ("US Energy" or the "Company") (OTCBB:USEI) today reported the Company's financial results for the three and six month period ended June 30, 2006.

For the three month period ended June 30, 2006, the Company revenues increased 624% from $35,574 to $257,585 while gross profit increased 1,158% from $17,399 to $218,936. For the six-month period ended June 30, 2006, revenues increased 692% from $53,757 to $425,685 while gross profit increased 822% from $24,750 to $227,945. Including non-operating losses, for the three month period ended June 30, 2006, the net loss increased 199% from $(839,141) or $(.01) loss per share to $(2,511,269) or $(.02) loss per share. Including non-operating losses, for the six month period ended June 30, 2006, the net loss increased 129% from $(1,983,340) or $(.02) loss per share to $(4,542,337) or $(.04) loss per share.

"We've recently announced certain significant projects that commence during third and fourth quarter of this year and ramp up throughout 2007. Among our current initiatives are our program with General Motors scheduled for launch during December 2006, our agreement with GreenGas in Thailand for the sale of 1,500 systems with initial deliveries beginning during September 2006 and an agreement with TruckGas in Europe for the sale of 2,000 systems with initial deliveries scheduled for early 2007," said US Energy CEO Mark Clancy. "While we are disappointed with our continued losses migrating US Energy from a development to an operational stage, we are encouraged by our continued growth in revenues and improved gross profit. In addition, our financial report at June 30, 2006 does not include the impact of our recent acquisition. As we continue a steady migration from development to operations through ramping up the sale of our dual-fuel systems together with the operating performance of Automated Engineering, we anticipate improvement in both our top line revenue and net income," concluded Mr. Clancy.

About US Energy Initiatives Corporation (OTCBB:USEI), formed in 1996, manufactures and markets its patent dual-fuel diesel to natural gas conversion technology though the automotive aftermarket and through certain original equipment manufacturers. The Company's primary facility is a state-of-the-art systems development and emission testing lab in Atlanta, Georgia. The Company's current clients include General Motors , http://www.ups.com; US Postal Service; Dallas County School System, Portland, Oregon School System; Oklahoma Natural Gas and a host of private purchasers.