HOUSTON, May 22 /PRNewswire-FirstCall/ -- H2Diesel Holdings, Inc. ("H2Diesel" or the "Company") (OTC:HTWO) (BULLETIN BOARD: HTWO) , with executive offices in Houston, Texas, was formed in March 2006 to commercialize a revolutionary new technology for the manufacture of bio-fuel from renewable vegetable oils and animal fats. The company has an exclusive perpetual license agreement to certain proprietary technology to manufacture bio-fuel (the "H2Diesel Bio-Fuel") that is intended to be marketed as a heating fuel, a fuel for power generation, a motor fuel, or as a fuel additive. H2Diesel's Bio-fuel has been designed to compete with petroleum distillate, kerosene, diesel fuel, and biodiesel and is capable of being produced from a broad array of vegetable oils and animal fat feed stocks without using a complicated chemical reaction or producing by-products. At the same time, H2Diesel has properties that are superior to some other bio- fuel products including: -- H2Diesel runs in conventional diesel engines. -- H2Diesel's Bio-fuel produces approximately 80% less carbon dioxide emissions, and almost 100% less sulphur dioxide than traditional petroleum diesel. -- H2Diesel's Bio-fuel has beneficial properties because it is more lubricating than petroleum diesel fuel. -- H2Diesel can be made from domestically produced, renewable oilseed crops such as soybeans, canola, palmetic, sunflower, GMO, cotton seed, mustard seed, restaurant waste oils, and animal fats. -- Traditional biodiesel is typically used in blends of up to only 20%. H2Diesel's Bio-fuel can be used at 100% strength. -- Unblended H2Diesel Bio-fuel is a 100% renewable product, while traditional biodiesel blends are still 80% petroleum based. -- Some traditional biodiesel products begin to gel at typical winter temperatures. H2Diesel's Bio-fuel stays liquid to temperatures well below zero degrees Fahrenheit. -- H2Diesel's Bio-fuel, unlike the complex transesterification process used by many bio-fuel producers, is manufactured using a simple blending or emulsification process. Water is blended with a combination of commonly available ingredients to make a proprietary additive. -- The additive is then blended with vegetable oil or animal fat feedstock to produce the H2Diesel Bio-fuel. There are no significant by-products from the process. This simplicity of production allows for reduced capital expenditures relating to the construction and operation of H2Diesel plants. In addition, H2Diesel Bio-fuel is biodegradable. RECENT EVENTS On May 9, 2007, H2Diesel Holdings, Inc. completed the offering of 27,950 shares of the Company's newly issued Series A Cumulative Convertible Preferred Stock, par value $0.001 per share (the "Preferred Stock") at a price of $100.00 per share to persons who qualify as "accredited investors" under the Securities Act of 1933. The gross proceeds from the offering were $2,795,000. On May 7, 2007, the Company announced that Connie Lausten, P.E. has joined H2Diesel as VP of Legislative and Regulatory Affairs. Ms. Lausten will be responsible for working with senior management to formulate and implement corporate regulatory and legislative affairs policies and leading interactions with regulatory bodies, governmental agencies, and trade groups. She will help identify grant and public/private partnership opportunities and work to advance H2Diesel's strategic objectives. On May 4, 2007, H2Diesel entered into a Test Burn Agreement with a major US independent power producer for the purpose of evaluating the Company's proprietary bio-fuel technology in power generation applications. On April 26, 2007, the Company announced an agreement with eBarton LLC, a renewable energy finance and transaction structuring company, to assist H2Diesel in marketing its alternative bio-fuel to utilities and independent power producers in North America. On March 29, 2007, the Company announced it has entered into a Letter of Intent with Twin Rivers Technologies, LP to advance negotiations with respect to the proposed development of H2Diesel's first production plant at Twin Rivers' facility located in Quincy, MA. Long-Term Plan of Operations The long-term business plan includes: -- Developing additive and/or H2Diesel Bio-fuel production capacity through the engineering, construction and operation of company-owned domestic bio-fuel plants or through joint ventures -- Continuing efforts to explore the potential to sublicense the technology throughout the exclusive territory -- Finding buyers for H2Diesel Bio-fuel in the heating fuel, marine and power generation market segments. In addition, subject to receipt of the necessary regulatory approvals, fleet operators of trucks and other diesel powered vehicles represent an opportunity for additional Bio- fuel sales -- Seeking out strategic joint venture partners domestically as well as in foreign territory which can provide benefits in terms of commitments to buy bio-fuel, sublicense the technology and capital commitments necessary to engineer, construct and operate additive and/or bio-fuel plants -- Entering into feedstock supply and transportation logistics contracts in order to supply any refineries that may be built or acquired -- Seeking qualified, experienced and motivated professionals to join the management team. David A. Gillespie, President and CEO of H2Diesel said, "H2Diesel's company overview outlines our opportunities for major expansion and development. We are confident that our proprietary technology to manufacture an alternative bio-fuel from a wide variety of vegetable oils and animal fats at a competitive price and with a reduced pollution footprint, provides us with a unique ability to capitalize on the expanding bio-fuel market." About H2Diesel Holdings, Inc. H2Diesel is a development stage company that holds an exclusive license for North America, Central America and the Caribbean to proprietary technology for the manufacture of an alternative "bio-fuel" from produced vegetable oils and animal fats that is intended to be marketed as a new class of bio-fuel or fuel additive for power generation, heavy equipment, marine use and as a heating fuel. The Company further believes its proprietary bio-fuel will provide a cheaper, renewable alternative energy source with significantly lower emissions than traditional fuels and a cleaner and more efficient alternative to heating oil. H2Diesel's business model calls for the establishment of bio-fuel production facilities directly and through sublicensing of its technology to qualified licensees. Forward Looking Statements This news release contains forward-looking statements. These forward- looking statements concern the operations, prospects, plans, economic performance and financial condition of H2Diesel Holdings, Inc. (the "Company") and are based largely on the Company's beliefs and expectations. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results expressed or implied by such forward-looking statements. The risks and uncertainties related to the Company's business include all the risks attendant a development stage business in the volatile energy industry, including, without limitation, the risks set forth under the caption "Risk Factors" in the Company's Annual Report on Form 10-KSB for the fiscal year ended December 31, 2006. In particular, the ability of the Company to complete its initial production facility will be subject to uncertainties regarding, among others, obtaining necessary financing for the construction and complexities related to the Company's bio-fuel which has not yet been produced on a commercial scale. CONTACT: David Gillespie, President & CEO Rob Schatz H2Diesel, Inc. WolfeAxelrod Weinberger Associates LLC. 713-973-5720 212-370-4500 DATASOURCE: H2Diesel Holdings, Inc. CONTACT: David Gillespie, President & CEO of H2Diesel, Inc., +1-713-973-5720; or Rob Schatz of WolfeAxelrod Weinberger Associates LLC., +1-212-370-4500,

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