AFS (2004) announces contracts and staff changes

CALGARY, June 20 /CNW/ - Alternative Fuel Systems (2004) Inc.
("AFS (2004)" or the "Company") (TSX Venture: AFX) announced today that it has
signed a contract to manufacture a newly-developed customized ignition and
fuel control system for a customer based in the United States. The contract is
valued at $160,000 US (about $200,000 Cdn at an exchange rate of 1.25). The
system design is complete, and production is now underway. Deliveries are
scheduled for the second and third quarters of 2005. The customer has said
that most of these products are intended for end users in countries outside
North America. AFS (2004) President and CEO Jim Perry stated that "with this
order, we have demonstrated that we can move a custom product from concept to
production very quickly. In our rapidly changing market, this ability is an
asset in the search for additional business".
AFS (2004) also announced that it has signed a follow-up contract with
Iran Heavy Diesel Engines Manufacturing Company ("DESA") to provide
engineering services and a custom fuel injection and control system for the
conversion of a 710 kW turbocharged diesel engine to allow it to run on a
mixture of diesel fuel and natural gas. The total value of the contract is
$136,500 US (about $171,000 Cdn). Work on this project will commence once a
letter of credit is in place. It is anticipated that the activities involved
will occur between now and the end of 2005, depending on a number of factors
including mechanical work to be done by DESA.
Finally, the Company also announced that Joyce Berg, CGA, has joined the
company as Controller. Joyce has held a number of senior financial positions
in the oilfield service industry and in the healthcare sector. She will be
taking over responsibilities for financial reporting and accounting matters
from V.P. Finance and C.F.O. Chris Martin, who will be leaving AFS (2004) at
the end of June, 2005. Jim Perry stated that "Chris made a tremendous
contribution to the Company as we restructured and worked to turn things
around. Now that these complex financial matters have been completed, Chris is
ready for a new challenge. I certainly wish him well in his new career. I also
look forward to working with Joyce in her new position".
AFS (2004) is a Canadian company providing innovative and cost-effective
solutions to the growing global problem of harmful exhaust emissions from
internal combustion engines. AFS (2004) has commercialized electronic engine
management systems enabling diesel and gasoline engines to operate on cleaner
burning natural gas. The Company is headquartered in Calgary, Canada and
trades on the TSX Venture Exchange under the trading symbol AFX.

Forward-looking statements - this news release may contain        
forward-looking statements about AFS' business, marketing and product
development plans based on the current expectations of management.
AFS (2004) cautions investors that any forward-looking statements are
subject to various risks, uncertainties and other factors that could cause the
Company's actual results to differ materially from those expressed in, or
implied by forward looking statements. These risks, uncertainties and other
factors include, without limitation, uncertainty related to the Company's
ability to successfully implement its business strategy; the risk that product
development projects may not be completed successfully or in a timely manner;
the ability of the Company to successfully negotiate and execute definitive
agreements with its customers; the development of competing technologies and
the possibility of increased competition; fluctuating energy prices;
uncertainties involving government policies and government regulations
affecting the Company's business.

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