BioteQ Provides an Update on Operations and Projects

VANCOUVER, BC – BioteQ Environmental Technologies Inc. (TSX VENUTURE:BQE) today reports on progress at its operations and development projects scheduled during 2006:

  • Raglan plant begins operation earlier than planned to meet new production target
  • Bisbee plant operating at planned copper production with operating availability in excess of 97%
  • Caribou operations treated record water volumes in 2005 and demonstrate new plant capacity for 2006
  • Wellington Oro project construction initiated
  • Inco North Mine project engineering in progress
  • Pueblo Viejo project engineering in progress
  • Dexing project engineering in progress
  • Preliminary engineering for La Jojoba project in Mexico initiated
  • New agreement signed with Paques
  • New personnel added due to increased project activity

Raglan Plant – Early Startup Achieved
BioteQ’s Raglan plant, located in Northern Quebec at the Raglan Mine which is owned by Falconbridge, was shut down in November as planned after treating over 500,000 cubic meters of water during the 2005 operating season. The plant was upgraded last year, resulting in a 50% increase in treatment capacity, to meet higher water treatment demands anticipated this year. BioteQ employees have been on site since late March and the plant was re-started in April as weather permitted. The plant started discharging treated water in early May, approximately one month earlier than last year. The treatment objective is 700,000 cubic meters of water during the 2006 operating season. BioteQ charges a treatment fee of $1.06 per cubic meter of water treated as well as a fixed monthly fee of $24,500.

Bisbee Plant – Return to Normal Operation
Following disappointing results during the third and fourth quarters of 2005, due to equipment failures, repairs were completed in late 2005 and early 2006 and the Bisbee plant has returned to normal operating levels. After a slow ramp up during the first quarter following the prolonged shutdown the plant is now operating at the 2006 planned target of 5,500 pounds per day of copper recovered, which is the current limit of the flow from the stockpile. Copper recovery continues to be high at over 99% and the copper content in the feed solution has remained steady at approximately 360 parts per million. The current operating availability is over 97%. BioteQ’s share of revenue for the first quarter of 2006 from Bisbee, after refining charges, was $277,000, which included a slow ramp up of production using chemical sulphide through most of the first quarter.

The joint venture is now focusing on reducing operating costs and increasing copper production.

Caribou Site – Plant Improvements Meet the Demand of Record Rainfalls
Process improvements at the Caribou and Restigouche sites that were completed last year have allowed BioteQ to treat record volumes of water at both sites. The sites received record rainfall events late last year and to date in 2006 the Caribou plant has treated 30% more water than planned and the Restigouche plant has treated more than double the historic water volume typical for the same period – while meeting all discharge regulations at both sites. Operations at Caribou were not profitable during the first quarter due to additional heating and labour costs associated with winter operations that were required to maintain safe operating water levels. BioteQ and Breakwater have agreed to an increase in the monthly fees charged by BioteQ to $99,000 per month, with an annual adjustment based on quantity and quality of water treated in the previous year.

Blackwell Plant Construction
The Blackwell plant, located in Oklahoma, was constructed in modules which were designed and fabricated in Vancouver and completed last year. Final installation of the modules and plant commissioning is pending completion of certain site permits and infrastructure by Phelps Dodge. The plant has been designed to recover zinc and cadmium from a groundwater source, utilizing BioteQ’s ChemSulphide™ process.

Wellington Oro Project – Equipment Procurement Initiated
As previously announced, the company has signed the final construction agreement with the Town of Breckenridge and the Board of County Commissioners of Summit County, Colorado for the construction and commissioning of the Wellington Oro water treatment plant. Engineering for construction is well advanced and equipment procurement has been initiated by BioteQ. The Wellington Oro project will use BioteQ’s ChemSulphide™ process, similar to that incorporated in the Blackwell project.

INCO Project – Engineering in Progress
An agreement signed with Inco Ltd. in 2005 provides for an engineering study, conducted jointly, to determine the best process route to recover nickel from acidic mine drainage at Inco’s North Mine, located near Sudbury. The study was originally scheduled for completion in the first quarter of 2006, however, additional site piloting was required to incorporate new site data. The study is expected to be complete in June this year and will provide the basis for construction. Current engineering has confirmed the initial estimates of nickel production and that the process selected will be similar to BioteQ’s process utilized at the Raglan operation. A patent is pending for the nickel recovery process in operation at Raglan.

Pueblo Viejo Project – Engineering in Progress
BioteQ previously announced an agreement with Placer Dome Technical Services for the development of a water treatment facility at the Pueblo Viejo gold project located in the Dominican Republic. Since the acquisition of Placer Dome by Barrick Gold Corporation, BioteQ has been working with Barrick and their consultants as part of the overall gold project feasibility that is in progress by Barrick. Additional pilot studies have been scheduled with Barrick to include BioteQ’s BioSulphide® Process as part of the water treatment facilities at Pueblo Viejo.

Dexing Project – China Development Project In Progress
Site due diligence has been completed for the Dexing copper project, in joint venture with Jiangxi Copper Corporation in China. Project engineering has now been initiated to define the capital and operating costs more accurately before the joint venture partners complete the final joint venture agreement, as outlined in the current Agreement between the companies as previously announced. Plant construction is expected to begin later in 2006 with plant completion in 2007.

La Jojoba Project – Preliminary Engineering Initiated
Preliminary engineering, including a site due diligence study and laboratory scale pilot testing, has been initiated on La Jojoba project in Mexico. This project is a new application of BioteQ’s sulphide technology where cyanide can be regenerated for the recovery of gold in a conventional heap leach operation with concurrent recovery of copper from the cyanide solutions. Plant construction is expected in 2007.

Paques Agreement – New Agreement Signed with Paques
The company previously reported that its cooperative development agreement with Paques bv of the Netherlands had expired. A new Royalty and Marketing agreement has been signed with Paques, which expires in June 2014, to consolidate the technologies and intellectual property of both companies in a coordinated effort to market biogenic sulphide technology for selected applications in the mining industry. BioteQ has paid a one time lump sum royalty to Paques of EUR 175,000 for the use of technology that was developed cooperatively and is described by patents owned by both companies. This includes the technology marketed by BioteQ as the BioSulphide® Process, used at the Bisbee plant, and Paques’ technology marketed as ThioteQ®. Paques maintains worldwide patent protection for their biotechnologies. The agreement allows BioteQ to build one plant in any calendar year using the shared technology with no further royalty payable. Should BioteQ build two or more plants in any calendar year using the shared technology then additional royalty payments have been agreed. BioteQ’s current project pipeline includes one site, Pueblo Viejo, where the shared technology might be utilized.

The new agreement with Paques supersedes the previous agreement, which included a variable royalty payment depending on plant capacity, and simplifies the royalty calculation going forward for both companies. BioteQ’s territory under the new agreement remains the same which excludes Europe and Africa.

Personnel Additions at BioteQ
The company is pleased to announce the appointment of Dr. David Kratochvil, P.Eng., previously Manager, Engineering and Project Development, to the position of Vice President, Projects. Dr. Kratochvil will now be responsible for operations and will take on additional corporate duties in his new role. Michael Bratty, P.Eng., a senior process engineer with the company, will be taking on Dr. Kratochvil’s plant engineering responsibilities. Mr. David Salari, P.Eng., has been appointed Manager of Construction to provide focused management of the construction projects currently in progress, also reporting to Dr. Kratochvil. Mr. Songlin Ye, P.Eng., has been appointed Manager, China Development and will be responsible for the development and operation of the Dexing project in Jiangxi Province in China. Mr. Ye was most recently employed by AMEC Earth & Environmental in Vancouver.

First Quarter Results
Preliminary results for the first quarter 2006 indicate that the company was profitable from operations but will show a loss of $0.02 per share overall. As noted above, higher seasonal costs at Caribou and the ramp up of production at Bisbee resulted in net revenues below expectations. G&A costs were similar to the previous quarter and project marketing and development costs have increased due to the large number of projects which are approaching the stage of final contracts.

The company anticipates that the second quarter will be approximately breakeven and that the company will be cash positive in 2006 (EBITDA), if normal operations continue as planned. Total revenue anticipated by the company in 2006 from all operations and development projects is $6 million, approximately double the total revenue reported for 2005.

Corporate Profile
BioteQ is establishing itself as a leader in the treatment of acid contaminated water through the use of its patented BioSulphide® Process and related sulphide technologies. Focused on the mining industry, BioteQ has partnered with leading metal producers including Phelps Dodge, Breakwater, INCO, Jiangxi Copper and Falconbridge as well as utilities operator EPCOR Water Services, to finance, design, build and operate mine site water treatment plants which recover saleable metals in addition to meeting ever stricter environmental regulations.


On behalf of the Board of Directors

Brad Marchant