American Water Star to Lease Option a Plant near New Orleans and Receives Re-Orders for Its Flavored Beverages.

LAS VEGAS -- American Water Star Inc. (AMEX: AMW) would like to inform our shareholders that prior to Hurricane Katrina we were in negotiations to enter into a lease with an option to purchase a plant located in Kentwood, La. Kentwood is located approximately 85 miles northwest of New Orleans. The plant is 75,000 square feet on 6 1/2 acres with a natural spring. The plant has been producing 3- and 5-gallon bottles of water for home and office delivery. Two other lines are set up to run 1- and 1 1/2-liter PET production. Estimated capability is 35 trucks a day (approximately 1.2 million bottles).

"When I was negotiating to acquire this facility I had no idea just how crucial this plant would be logistically to handle our current contracts. We currently are installing two backup generators to make the plant additionally functional. This will allow us to get water quicker to the Lipsey/FEMA locations and will also save on freight costs for Lipsey/FEMA," said Roger Mohlman, CEO of AMW. "In addition, this plant provides another important location to run our other brands for retail and school delivery."

In addition to the constant production for Lipsey/FEMA, we are continuing to deliver flavored beverages to retailers and school districts nationally. "The amount of re-orders for Geyser Fruit is constantly growing," said Mohlman. We have also received additional re-orders from our newest customer, DeFeo, one of the larger purveyors of beverages to hotels, food chains and schools in the region. DeFeo, located in Kansas City, currently maintains contracts with the Kansas City school district for our flavored Geyser beverages and has added our sugar-free, calorie-free mixers under the brand Fling's Kansas City Mixers for their hotel and retail customers.

About American Water Star Inc.

American Water Star Inc. ("AMW") is a publicly traded company and is engaged in the beverage bottling industry. Its product brands are licensed and developed in-house, and bottled in strategic locations throughout the United States. AMW's beverage products are sold by the truckload, principally to distributors, who sell to retail stores, corner grocery stores, convenience stores, schools and other outlets.

At AMW, we believe our great-tasting, new zero sugar, zero calorie flavored water beverages have positioned us to capture a large share of the market for healthy flavored waters. Our product line consists of four branded beverages: Geyser Sport, Geyser Fruit and Geyser Fruta. Geyser Sport is a sugar-free, calorie-free, carb-free fruit flavored beverage fortified with vitamins and calcium, offered in eight different fruit flavors. Geyser Fruit is a non-carbonated water with a low sugar content, also offered in eight different flavors. Geyser Fruta is targeted to the Hispanic market and includes authentic Latin-flavored beverages.

Forward-Looking Statements

This press release may contain statements that constitute "forward-looking statements" as defined under U.S. federal securities laws. Generally, the words "believe," "expect," "intend," "estimate," "anticipate," "establish," "project" and similar expressions identify forward-looking statements, which generally are not historical in nature. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or projections. These risks include, but are not limited to, a final lease option agreement being reached with landlord of the Kentwood plant; AMW's production capabilities; acquiring qualified personnel to run the Kentwood plant; changes in economic conditions; changes in the nonalcoholic beverages business environment, including actions of competitors and changes in consumer preferences; our ability to capture market share; the effectiveness of our advertising and marketing programs; fluctuations in the cost and availability of raw materials or necessary services; our ability to avoid production output disruptions; our ability to achieve earnings goals; regulatory and legal changes; our ability to penetrate developing and emerging markets; litigation uncertainties; and other risks discussed in our filings with the SEC, including our Annual Report on Form 10-KSB, Quarterly Reports on Form 10-QSB, and Current Reports on Form 8-K, which reports are available from the SEC. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. We undertake no obligation to publicly update or revise any forward-looking statements to reflect current events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.