BlueStar Battery Systems International Reports Year End Results.

VANCOUVER, BRITISH COLUMBIA--(BUSINESS WIRE)--Feb. 14, 1997-- BlueStar Battery Sys (Alberta Stock Exchange BHW.) BlueStar Battery Systems International Corp. (BlueStar) is pleased to announce its financial results for the twelve months ended September 30, 1996. The Company today reported record revenues for the 1996 fiscal year totaling $3,310,565, a 177 percent increase over the 1995 fiscal year results of $1,192,463. The Company reported a net loss of $3,639,267, or $0.45 per share compared to a 1995 net loss of $1,554,254, or $0.43 per share.

The resultant growth trend is attributable to the Company's strategy of global market diversification. Significant yearly accomplishments include:

- a new European sales office was opened in the summer of 1996;

- a relationship was established to enter the Asian marketplace;

- a 5-year contract to be the sole supplier for four (4)

of the US Army CECOM's primary, cylindrical lithium batteries.

The US Army expects the contract to represent approximately $40 million in sales and could go as high as $71 million if maximum quantities are ordered; and a 60,000 square foot facility was purchased in October 1996 expanding the production capacity to meet the Company's growing demand. Production in the first and second quarters of 1997 is expected to be reduced during the move and set-up of the new facility. Production for the US army contract is scheduled to start in July 1997.

In addition to the Company's focus on globalization, BlueStar has continued its commitment to look to the future. In the 1996 fiscal year, the research and development program spent approximately $1 million with over 50 percent of the costs funded by outside sources. Highlights for the year were:

- Continued progress in the multi-year program ($3 million

US funded by the U.S. Air Force and the Canadian National

Defence) directed toward the development of large rechargeable 

lithium ion batteries for air/spacecraft. Initial delivery of

large rechargeable batteries is scheduled in 1997.

- Award of a 2-year contract to develop and deliver high

energy pouch cell batteries. This program is cost shared with

the U.S. army.

- Award of a 1-year program to focus on a high energy carbon

and fluorine compound. This program is cost shared with

the Science Council of British Columbia.

- Creation of BlueStar Advanced Technology Corp., a new

subsidiary strictly dedicated to the research and development

efforts of the corporate group.

The Company has entered into an agreement to acquire 100 percent equity ownership of Canadian DC Systems Inc., a national battery assembler and distribution company. The purchase is subject to certain conditions precedent and regulatory and BlueStar shareholder approvals.

BlueStar is a Vancouver, Canada-based developer, manufacturer and marketer of a wide range of battery products sold in the international market place. Historically, typical applications of BlueStar's products included portable communications equipment, emergency locator transmitters and remote sensing equipment. However, with its continued research and its expansion of distribution networks, future markets are expected to range from lead acid to rechargeable lithium batteries. -0-

The Alberta Stock Exchange has neither approved nor disapproved the information contained herein.

CONTACT: BlueStar Battery Systems International Corp.

Greg Agar, 604/ 681-0363

1-800-806-5611