Advance Nanotech Subsidiary Awarded SBIR Grant from National Science Foundation.

Owlstone Nanotech Receives Phase I Funding to Develop Detection System for Hazardous Compounds

NEW YORK -- Advance Nanotech, Inc., (OTC BB:AVNA.OB), the premier provider of financing and support services to drive the commercialization of nanotechnology related products for Homeland Security and Display technologies today announced that its subsidiary, Owlstone Nanotech, has been awarded a Small Business Innovation Research (SBIR) Phase I award of $99,080 from the National Science Foundation to develop an integrated field asymmetric ion mobility sensor for volatile organic compound (VOC) detection. The SBIR program is a highly competitive award program that provides support to small businesses to develop innovative technologies with significant commercial potential.

Many VOCs are either known or suspected to be hazardous to human health and are important constituents of both indoor and outdoor air pollution. The presence of VOCs can also be important early-warning signatures for fire prevention. For these reasons there is considerable interest in developing the ability to measure and monitor VOC levels in domestic and industrial environments but the technologies for detecting these compounds have lagged behind the market need. Owlstone will use the SBIR grant to employ the company's field asymmetric ion mobility spectrometry (FAIMS) technology in the development of a small, low-cost sensor suitable for air quality monitoring and early warning fire detection.

"Owlstone Nanotech has developed the most advanced and effective technologies for detecting airborne chemical hazards," said Bret Bader, CEO of Owlstone. "This SBIR award will enable us to explore new applications of our technology -- ones that will have an enormous positive impact on human health and safety and represent a critical leap forward in our quest to bring our technology into industrial and consumer applications."

Commenting on the award, Tony Goncalves, CEO of Advance Nanotech said, "It is encouraging that the United States government has recognized the power and potential of Owlstone's chemical detection system. This award represents a validation of the science behind Owlstone's revolutionary technology and opens up an exciting spectrum of commercial opportunities for the company."

Owlstone Nanotech is part of Advance Nanotech's Homeland Security Division which includes nanotechnologies providing solutions across two application areas: CBRNE (Chemical, Biological, Radiation, Nuclear and Explosive) and Wireless Monitoring for cognitive awareness, triage and first response therapy. This division launched its first product in early 2006, reported revenues for the year and has a customer base across the defense and industrial process control industries.

About Advance Nanotech, Inc. (www.advancenanotech.com)

Advance Nanotech identifies patented, patent-pending and proprietary technologies at leading universities and funds the additional development of such technologies in exchange for the exclusive rights to commercialize any resulting products. Advance Nanotech has interests in over 20 nanotechnologies. In August 2006, the company completed a strategic realignment of its portfolio to more aptly leverage the strengths of the portfolio to provide the greatest value to shareholders. The Company currently possesses a critical mass of technologies in two core areas of activity; Homeland Security and Displays.

By partnering with universities and leveraging the infrastructure and multi-disciplinary human resources of our university partners, we reduce our cost base and mitigate risk. After prototypes are proven within the lab and we develop a product roadmap and business plan, we form majority owned subsidiaries around the specific technology. We seek to return value to our shareholders through the sale or licensing of the technology, by securing additional financing for the subsidiary from either the venture capital community or the capital markets, or by successfully executing our business plan and consolidating its income as the majority shareholder.

This news release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof. Our actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including the recent economic slowdown affecting technology companies, the future success of our scientific studies, our ability to successfully develop products, rapid technological change in our markets, changes in demand for our future products, legislative, regulatory and competitive developments and general economic conditions. Our Annual Report on Form 10-K and 10-K/A, recent and forthcoming Quarterly Reports on Form 10-Q and 10-Q/A, recent Current Reports and other SEC filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.