Ballard Signs Exclusive Agreement for QuestAir's Hydrogen Purification and Oxygen Enrichment Technology.

Business Editors

VANCOUVER, B.C.--(BUSINESS WIRE)--Sept. 27, 2000

Ballard Power (NASDAQ:BLDP)(TSE:BLD.)

Ballard Power Systems (TSE:BLD.)(NASDAQ:BLDP) and QuestAir Technologies Inc. announced today that they have signed an agreement to develop and commercialize QuestAir's hydrogen purification and oxygen enrichment technology for use with Ballard(R) fuel cells. Ballard will also acquire 10 per cent of QuestAir shares, on a fully diluted basis, at a price of $16.7 million (US$11.2 million).

Under the agreement, which covers a defined period, Ballard has the exclusive right to QuestAir's technology for use in proton exchange membrane (PEM) fuel cell applications. Ballard will fund a portion of QuestAir's related development costs. Completion of the transaction is subject to approval by shareholders of QuestAir, which is a private company.

"The successful development of QuestAir's proprietary technology for use with our fuel cells is expected to contribute to the cost reduction of our products," said Kip Smith, Ballard President and Chief Operating Officer. "This collaboration with QuestAir reflects our goal of securing relationships that have strategic value in developing commercial Ballard(R) fuel cell products."

Denis Connor, QuestAir's President and Chief Executive Officer, said, "We are excited about working with the world leader in proton exchange membrane fuel cell development, a collaboration which we believe will enhance commercialization efforts of both Ballard and QuestAir. We welcome Ballard as a shareholder and look forward to a mutually beneficial long-term relationship."

QuestAir's oxygen enrichment system will be developed and integrated with Ballard's proton exchange membrane fuel cells, allowing reductions in fuel cell stack size and weight, thereby improving power density and generating cost savings. QuestAir's hydrogen purification system, which removes impurities from the hydrogen generated from onboard or stationary fuel processing, will contribute to the development of high performance and cost-effective fuel reforming systems.

QuestAir is focused on the development and commercialization of a proprietary revolutionary pressure swing adsorption technology, which separates and enriches selected gas streams with enhanced speed and compactness. The technology can be used in a wide range of applications including fuel cells, diesel emissions reduction, industrial gas applications, and medical oxygen devices. QuestAir, which is based in Burnaby, B.C., has partnered with BOC Gases to introduce its oxygen products into the industrial gas market.

Ballard Power Systems is recognized as the world leader in developing, manufacturing and marketing zero-emission proton exchange membrane (PEM) fuel cells for use in transportation, electricity generation and portable power products. Ballard Power Systems' proprietary fuel cell technology is enabling automobile, electrical equipment and portable power product manufacturers to develop environmentally clean products for sale. The fundamental component of these end-user products is the Ballard(R) fuel cell that combines hydrogen (which can be obtained from methanol, natural gas or petroleum) and oxygen (from air) without combustion to generate electricity. Ballard is partnering with strong, world-leading companies, including DaimlerChrysler, Ford, GPU International, ALSTOM and EBARA, to commercialize Ballard fuel cells. Ballard has also supplied fuel cells to Honda, Nissan, Volkswagen, Yamaha, Cinergy, Coleman Powermate and Matsushita Electric Works, among others.

This release contains forward-looking statements reflecting Ballard's current expectations as contemplated under the Safe Harbor provisions of the US Private Securities Litigation Reform Law of 1995. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including, without limitation, product development delays, changing environmental regulations, the ability to attract and retain business partners, future levels of government funding, competition from other fuel cell manufacturers, competition from other advanced power technologies, competition from existing power technologies, evolving markets for generating electricity and power for transportation vehicles, and the ability to provide the capital required for product development, operations and marketing. These factors should be considered carefully and readers should not place undue reliance on Ballard's forward-looking statements. Investors are encouraged to review the section titled "Operating Results, Capital Requirements and Risks" (pages 35 to 40) in the Management's Discussion and Analysis section of Ballard's 1999 Annual Report for a more complete discussion of factors that could affect Ballard's future performance.

Ballard's Common shares are listed on The Toronto Stock Exchange under the trading symbol "BLD" and on the Nasdaq National Market System under the symbol "BLDP". Ballard and the Ballard logo are registered trademarks of Ballard Power Systems Inc.